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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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Hi I am a 50% owner of a small California S corporation.

Customer Question

Hi
I am a 50% owner of a small California S corporation. My business partner is the other 50%. I am leaving the business and want to assign my interest in assets and liabilities 100% to him.

I know I can simply transfer my stock to him, but given currently has more debt than assets, I want to be certain that I'm protected from any future liability issues. The other owner will sign off on the plan we've worked out. This is not hostile.

In addition, there is some money owed to me that he is willing to repay out of future work. This is just a "gentleman's agreement" but I'd like to have it in writing. I don't want any security on the loan and I know this wouldn't have any legal teeth, but if its written down, then the intent of this part of the agreement will be clear.

What do I need and how can you help?
Submitted: 4 years ago.
Category: Business Law
Expert:  Dimitry K., Esq. replied 4 years ago.

Thank you for your question. Please permit me to assist you with your concerns.

It appears that you simply need to reduce the terms to writing, and in the document state that upon transfer, all current and future obligations are assigned solely to your partner and not to you. While you cannot assign past obligations (as you were part owner at the time), future obligations can be so assigned. I do agree that placing the terms in writing tends to protect you more, and I disagree that it wouldn't have legal teeth, it just makes any oral agreement far harder to enforce because the terms are difficult to prove. While I cannot write this agreement for you, I can most definitely edit your draft or provide some additional thoughts. Would that suffice?

Customer: replied 4 years ago.

Thanks for your advice. I'll write it up and have you give it a look. How much will that cost?


 


Paul

Expert:  Dimitry K., Esq. replied 4 years ago.
Paul,

You already posted a price for your question. Unless we end up really spending a lot of time and effort on modifications, the value for the question should be sufficient. I look forward to assisting you further!
Customer: replied 4 years ago.

That's great Dimitry. I'll write it up in a couple days and send it to you via this medium.


 


Paul

Expert:  Dimitry K., Esq. replied 4 years ago.
Paul,

Great, I look forward to reading it!