Ask a Business Lawyer. Get Business Law Questions Answered ASAP.
The leaving partner invested $425 and the working partner contributed a like amount in labor. So that represents $850. What you have in the bank in excess of $850 would be split 50/50 and the leaving partner would get his $425 back. You have too little of a track record to consider future earnings since the amount you have generated is minor.
This communication is not intended as legal advice. A local attorney should always be consulted for legal advice. No client/attorney relationship is intended or created by this communication.
You have gross revenues of $1,000 per month. That does not take into account the value of your services working for the company. If you paid a normal salary of some type using minimum wage you probably are generating barely enough to pay salary. That is what you have to consider. You friend is acting like nobody has to work for the company to generate the revenues. Put a salary on your time, deduct that from the gross revenue, then deduct something for website maintenance will you need to plan for. What is left is your profit if any. That is why I said what I did.
For example if you put in 20 hours a week or about 85 hours a month at $10 an hour the salary would be $850. Add 15% for the company share of social security, etc. ($127.50) and your profit is about $22.5 per month. There is no profit to multiply. Give him the $1,187.18 he has in the business. Beyond that this business is marginal with no real history of success worth talking about. It is all futures and hope. It has no current value.
DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.
The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).