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If a business is for sale and partner 1 holds a 90% majority, can he sell the business without partner 2's signature? Can he pay partner No. 2 to get him out of the business before it sells? Partner 2 is ruining the business, is broke and is eating up profits. How do you get out partner 2 of the business even if the business does not sell? There is no partnership agreement that will show their percentage of interest and nothing in writing to rely on. Can you just pay him the investment he made into this and remove him? Even pay him more than what he invested to get him out of the partnership now? Thank you
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question: is this a corporation, LLC or partnership?
This is a partnership that is not in writing, husband and wife partners, one holds about 6 percent of the business, he failed to come up with the money promised to the seller. The other buyer, his partner, came up with almost all of the money and paid off the seller. He holds about 90 percent ownership. The lease is in his name, the liquor license is in his name and the real estate contract to sell the business is in his name. He wants to make him leave, he is ruining the business. He wants to give him his investment back and even give him more but he wants him out. And if he sells the business, he does not want him involved in the process at all. What can he do?
Hello. Another expert here. Sorry for the delay in getting back to you. It might have been a computer glitch. Without any written partnership agreement there is no partnership split other than 50-50. Of course the capital contributions would force partner 2 to come up with capital equal to partner 1 before 2 gets any money at all. Frankly, in no. 1s position, I don't know why he doesn't just take over,change the locks and tell 2 he'll settle with him later. Then partner 2 will have the burden of figuring out what to do about it.
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Thank you for your response. One more thought. Partner 2 is drinking all the profits, and his wife works there too (she is partners with him). They live on her tips. Can Partner 1 fire her so that it will remove her and him from the business? I agree to shut the doors but if not, fire her, he will not have a reason to come to the restaurant and Partner 1 can pay him something because if she is not working there and is terminated, they need the money. Closing the doors in the height of tourist season is a little hard to do. He just wants him out, his wife out, they are probably taking money from the till and drinking up profits. Thank you so much. Lynn
just want to make sure you got my second question to your answer to finalize my case. thank you
I appreciate all of your help. I am sure this happens frequently. Partner 2 does not have 5cents to hire an attorney. I would like to buy into this business, become a majority shareholder, reopen with a new name, some class, and do the hiring correctly as an ex HR vp. It is a great opportunity and it will provide people jobs to the small town. I hope it all works out and with your help and guidance it makes it a lot easier....thank you again.....Lynn