Advising to give up while there's still room to negotiate sounds like bad advice. At the worst, OP could turn this into a learning excercise on how to negotiate in a tough situation, with zero downside compared to the advice given here.
This doesn't have to be a protracted legal battle, but reading up on documents they signed, figuring out their proiories (continue in biz? get at least some value out? etc) and negotiating in good faith is something that might come very handy later, in another startup, with much more to lose.
I think negotiation is good, if you're realistic about it, and if you actually value what you're likely to get from it. And I agree, they should quickly find an answer to whether they can be fired by their partner (they probably can, for reasons stated elsewhere on the thread, but it's very much worth getting a solid answer).
It's not me, but if it were, I'd approach the getting fired problem with "look, I build this. You can fire me, but you don't have money for adequate dev and average Joe will run it into the ground in two months. Your greed will make you lose everything", and also approach the investor (if they're hands on) with the same rationale.
Also agree with the point you made elsewhere - this can get gut wrenching (even without any lawyers getting involved) and if you're prone to dwell on negative thoughts, pretty damaging to your morale through the duration. Money spent fighting is not the only downside.
The downside here is what happens after trust is broken... You end up working for another 12 months at the company pro-bono, then get canned 1 month before your next cliff vesting.
I would take 10% for the first year of service and walk with it, not expecting anything. The angel put in 100K for 10%, and you worked for a year for 10%. very simple.
