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How to remove a partner from an INC. company..plz help

Discussion in 'Commercial Snow Removal' started by X-LOWBALLER, Dec 23, 2007.

  1. X-LOWBALLER

    X-LOWBALLER Senior Member
    from Toronto
    Messages: 102

    I have a partner that wants out. The biz is incorporated. Is there a way to remove him from the incorporated business completely? Can he sell me his half? Anyone know?
     
  2. Camden

    Camden PlowSite Fanatic
    Messages: 6,598

    If your corp was set up properly you may buy his interest in the company via the purchase of his shares.

    Obviously, you need to agree on a price and you need to keep in mind that there will be tax owed on any gains.

    I'm sure there's more but perhaps others can fill in the gaps.
     
  3. tman3007

    tman3007 Senior Member
    Messages: 147

    I just did this 2 years ago. We simply went to the same lawyer that set up our incorporation and we already had a buyout price and terms established between the two of us. After that the lawyer simply reassigned his shares of the company back to us. We removed his name from all parts of the company (which released him from any liability that the company might incur), reassigned the officers within the company and that was that. Obviously there were a LOT of other details such as assets, no compete clauses, liabilities from existing contracts and other financial matters.

    But all in all, just make a basic outline of what you would like to achieve BEFORE you go into the lawyer. Our lawyer was $250 an hour...and then the lawyer can do his thing more efficiently. And that is the key, make it easier for the lawyer because even though we had everything laid out for him it still cost us over a grand. But it was money well spent.

    The buyout arrangement was made over the course of 1 year. I gave him a check for "X" amount of dollars on the day we reassigned shares and then every quarter thereafter. It was very smooth and we still remain best friends to this day.

    The key here is to find a good lawyer, after that the buyout is very simple. Just make sure both parties are getting what they rightfully deserve and follow the terms of your agreement. Piece of cake.

    Good Luck!