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Forum nameBiz Ideas
Topic subjectRE: Problems with other owners selling a business
Topic URLhttps://www.businessownersideacafe.com/forums/dcboard.php?az=show_topic&forum=103&topic_id=1295&mesg_id=1303
1303, RE: Problems with other owners selling a business
Posted by Phanntom, Sat Jun-16-07 08:39 AM
First and foremost consult with a lawyer and an accountant.

That said, when the business was formed each brought something of value to the table...the investors brought cash, and your husband invested time and energy which also has a value.

Each of the partners should have an equity account reflecting what they have put into the business. In most cases, the equity accounts are returned back to the partners based on their values before any profits from the sale are split. I would argue that you husbands efforts have a fair market value and they paid for that value by issuing him 10% equity in the business.

The other issue is the fairness of the currency value from then to now. I would argue that the value should be reflected by the current value otherwise their losing money on their investment simply through inflation.

I know you don't want to hear this but these things should have all been addressed in the orginal operating agreement when greed would not be an issue. The best time to layout the exit plan is before you enter...minds tend to be less self-serving at this time.
Good luck