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Richard, Attorney
Category: Business Law
Satisfied Customers: 55699
Experience:  32 years of experience practicing law and a businessman.
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I am entering into a partnership w/ my horse trainer on a show

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I am entering into a partnership w/ my horse trainer on a show horse valued at $20K. I now own 100% of the horse, free & clear. I plan to offer him 50% of the horse if he pays all the expenses for the length of the partnership.. The only glitch comes if we get a FMV offer for the horse. What is the best way to determine how much he would get when? For example, if we were to get a good offer only 2 months after we entered into the partmership, it would not be equitable that he get 50% of that money. What is the best way to proceed?

Good evening. You would want to address this in the partnership agreement. I would suggest something like this: you agree on the fair market value of the horse; then you change his percentage interest in the partnership as he makes capital contributions to cover the expenses. Then, at any time you sell the horse, he gets the value of his contributions based on the percentage of the total contributions...i.e., his contributions divided by (his contributions plus the agreed value of the horse).



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