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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Business Law
Satisfied Customers: 41221
Experience:  Run my own successful business/contract law practice.
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I own a membership organization. Its incorporated as a C Corp.

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I own a membership organization. It's incorporated as a C Corp. I own 100%. It's very small. Membership fees and event fees. Activities are 8 to 10 meetings a year. Got 3,150 cashbalance. Outstanding debt on the books is for my consulting services from the first 3 years (2004-2006) of about 16K which I have not been able to pay myself as had insufficient cash. Inflows of about 20K and outlows of about 20K last year. I love the thing but no time to keep it running. My exec Director Maggie is interested in taking it over. HOW DO I DO THAT? How do I 'sell it to her' or 'how do I shut it down'? If I hand it over to her, how could I get a certain income if she makes it successful. She says she can't pay me the 16K debt. Or, should I just shut it down?
Submitted: 7 years ago.
Category: Business Law
Expert:  Dimitry K., Esq. replied 7 years ago.
Thank you for your question.

You can create a contract for sale where the other party is obligated to pay you the balance owed within a certain period of time (for example, 5 years) and put in a rider that until your debt is paid off, she is obligated to pay interest on the debt and a portion of the profit made on the organization. You can add a clause that if she does not pay within the 5 years, you can re-take the business, or you can file suit against her personally, or at your discretion extend the length of the debt.

You are always free to shut it down, but that type of a contract may be what you are looking for as a means of protecting your interest.

Hope that helps.

Edited by Dimitry Alexander Kaplun on 2/2/2010 at 9:44 PM EST
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