What is the name of your state (only U.S. law)? Florida.
Excuse the long winded intro, but I feel the facts are important.
We are currently operating as a Florida Limited Liability Co, with multiple partners. We are essentially a family business with my father being the majority share holder at 54%. There are three other partners totaling 47% ownership. The additional partners (with the exception of one) contribute nothing. My Grandfather was the original founder of the company in the 50's.
To put it bluntly, my father has an alcohol/substance abuse problem. He is currently the acting President and through a series of bad decisions has put the company in a very bad position financially. We actively have a fair amount of accounts still in somewhat of a good standing, yet they are being damaged daily due to the inability to complete projects in accordance with deadlines. Our cash flow is very sporatic, and leaves hugh gaps in our abilities to pay vendors. My Brother and I have tried every avenue to reverse the damage, but it may be to late. We have tried multiple avenues of approach to raise capital, such as traditional finance, venture capital, ect. Usually they bail, or smell desperation and want to buy the entire company for pennies.
My brother and I have presented my father with one legitimate idea after another, to no avail. In a last ditch effort, as much as it breaks my heart, I urged him to lay off the entire plant and allow us to outsource our manufacturing for a short time, and slowly build ourselves back up again. We can no longer afford the payroll, taxes, liability and workmans comp. All of their checks bounced last week. I don't cry much, but there were literally tears in my eyes and a lump in my throat as I said goodbye as I always do, and watched our workforce leave the plant for the day. This may be their last week.
My father was advised by a bankruptcy attorney to personally file, but advised that doing so would leave his ownership in the company open to siezure. (Not that it is worth anything). Realistically, he and the company need to file bankruptcy. The company just needs to go chapter 7, let them come in and auction all the equipment off and be done with it, it's that bad.
I ask the attorney directly this question, but he dodged the questions and gave me an incomplete answer, mumbling something about fraud.
Here is my idea, my brother and I being officers but non share holders in the current company, essentially defect and start our own corporation with a very similar name. We would contact the current customers with pending projects, advise them the truth, and asked that their purchase orders be re-directed into our new company. Also my brother and I were working on new technolgies we intend to offer, that the old company didn't.
It looks like this; former employees saw the writing on the wall and bailed starting their own company. Previous company continues to dry up and files chapter 7, boom done. Our new start obviously would not have the machinery, but we have a network of people in which to outsource manufacturing until we can grow again. I would have to sell off some of my personal assets to raise operating capital, but I think I can bring a few of the previous employees into the new venture. If my father were to get help (and I think it would take him to lose everything to seek it), I would bring him back in some how to the new venture, and compensate him.
How is that fraud? Do I open my self up sort of litigation. Any realistic advice would be much appreciated.
What is the name of your state (only U.S. law)?
Excuse the long winded intro, but I feel the facts are important.
We are currently operating as a Florida Limited Liability Co, with multiple partners. We are essentially a family business with my father being the majority share holder at 54%. There are three other partners totaling 47% ownership. The additional partners (with the exception of one) contribute nothing. My Grandfather was the original founder of the company in the 50's.
To put it bluntly, my father has an alcohol/substance abuse problem. He is currently the acting President and through a series of bad decisions has put the company in a very bad position financially. We actively have a fair amount of accounts still in somewhat of a good standing, yet they are being damaged daily due to the inability to complete projects in accordance with deadlines. Our cash flow is very sporatic, and leaves hugh gaps in our abilities to pay vendors. My Brother and I have tried every avenue to reverse the damage, but it may be to late. We have tried multiple avenues of approach to raise capital, such as traditional finance, venture capital, ect. Usually they bail, or smell desperation and want to buy the entire company for pennies.
My brother and I have presented my father with one legitimate idea after another, to no avail. In a last ditch effort, as much as it breaks my heart, I urged him to lay off the entire plant and allow us to outsource our manufacturing for a short time, and slowly build ourselves back up again. We can no longer afford the payroll, taxes, liability and workmans comp. All of their checks bounced last week. I don't cry much, but there were literally tears in my eyes and a lump in my throat as I said goodbye as I always do, and watched our workforce leave the plant for the day. This may be their last week.
My father was advised by a bankruptcy attorney to personally file, but advised that doing so would leave his ownership in the company open to siezure. (Not that it is worth anything). Realistically, he and the company need to file bankruptcy. The company just needs to go chapter 7, let them come in and auction all the equipment off and be done with it, it's that bad.
I ask the attorney directly this question, but he dodged the questions and gave me an incomplete answer, mumbling something about fraud.
Here is my idea, my brother and I being officers but non share holders in the current company, essentially defect and start our own corporation with a very similar name. We would contact the current customers with pending projects, advise them the truth, and asked that their purchase orders be re-directed into our new company. Also my brother and I were working on new technolgies we intend to offer, that the old company didn't.
It looks like this; former employees saw the writing on the wall and bailed starting their own company. Previous company continues to dry up and files chapter 7, boom done. Our new start obviously would not have the machinery, but we have a network of people in which to outsource manufacturing until we can grow again. I would have to sell off some of my personal assets to raise operating capital, but I think I can bring a few of the previous employees into the new venture. If my father were to get help (and I think it would take him to lose everything to seek it), I would bring him back in some how to the new venture, and compensate him.
How is that fraud? Do I open my self up sort of litigation. Any realistic advice would be much appreciated.
What is the name of your state (only U.S. law)?
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