If a court determined that he breached, there could be damages for losses to the company based on his breach, i.e. it could go beyond him just giving back what they gave him. This is really the kind of thing where you need a lawyer's guidance based on very specific facts.
Re:Are these founders trying to screw me?
by dkokelley on Sunday October 05, 2008 @04:19PM
(#324307)
My point is that they haven't given him anything, thus there is no contract. The company can try and sue him for breach of contract but the issue is whether or not a contract actually exists. Of course a lawyer should always be involved to make sure that everything is ok legally.
And if he breached, what would he have to give back to the founders that was given to him for the code?
Also, if the code was given in return for equity (or the promise of equity), then he is an owner and should have a say in the decision to accept the investment and negotiate the terms.
I agree that the final stock agreement depends on the investor's lawyers (provided everything works out), but how the equity is divided before that is between the founder and the coder.