[maxklein]

Tell them that you are going to stop working till this issue is cleared up, and that if they decide to stop working with you, you will revoke all rights to the code you wrote for them through a court order, and that the business will fall through because of legal considerations.

Things will happen fast then. Otherwise, you just go get another job. You have nothing to lose that you have not already lost, they have everything to lose. You have them by the balls, don't let them intimidate you.

[readyrnot]

I have threatened this several times to which the founder freaked out and begged me not to stop. It's at a critical point. I believe mostly they are just trying to intimidate me. It's now come to a point where I absolutely can't trust them and I'm going to stop providing code until I get what I want. I believe you're right, when I threaten to stop things will happen rather quickly in my favor.

[maxklein]

Tell them that you want a handwritten promise of what you agreed upon verbally. No specific details, just a simple hand written promise at this moment, with a specific 3 or 4 week deadline to make this formal. If they say no, you tell them that they are acting in bad faith, and that you are going to stop work immediately.

An agreement is an agreement - if you have emails or chat messages or so on, that's already a contract.

They have a choice - give you something handwritten now or they lose their developer at the point where they are about to close a deal, which is a really bad time. They will tell you that this is the wrong time to apply pressure, but for you, this is exactly the right time. This is when they are most vulnerable because the deal could fall through, so this is your best chance to get this through.

When they have investment, how useful do you think you will be? They will just get rid of you and hire someone new.

[almost]

Don't just threaten, do. How long can it really take them to just give you the stock options? Especially when they realize they're screwed if they don't.

[DabAsteroid]

I have threatened this several times

Maybe this points to the root of the communication problem between you and them. By threatening, instead of doing what an assertive person might do (which might be to simply walk away with the code that you own and wait for them to contact you with a sweet offer in writing), you might be sending them a message that is poisoning the negotiations. It is possible to be passively abusive to people. It might be your own greed and anxiety that is preventing you from being a stand-up person, doing the stand-up thing, and making money off of this situation.

[readyrnot]

In good faith I continued to work. This was after I was lied to and screamed at. This was in hopes that they would turn around and be more agreeable. Clearly not the right thing to do. It's not greed, it's about getting what I was promised. You're right though about one thing ... paranoia breeds more paranoia. I've been nothing but forthcoming and honest.

[maxklein]

Why are you just presenting one side of the story? You are making yourself to seem like an angel and they like devils. At least balance your story a bit, it's getting a bit suspicious now.