what are my options in an LLC after I receive my buyout papers ?
I am an Partner there are 2 others a husband and a wife
- 1 decade agoFavorite Answer
I assume that you had agreed to a buyout offer. Once you receive the offer, is it what you were expecting. Is it a fair offer when considering the real value of the company? You need to evaluate profitability and net worth, including physical and liquid assets, and intellectual property. An easy calculation is 2 to 5 times annual profits, with companies developing new technology like software or medical demanding the higher end of that scale. Once the value is identified, did the offer match your ownership percentage of the net value?
Assuming that you have an acceptable offer, you need to have an attorney review the offer and the partnership agreement. You need to make sure that once executed and payment is received, that you will be legally removed from partnership and the released from all future liability.
If any part of the offer (offer amount or terms) is disagreeable, the first thing to do is negotiate. Make a counter offer. Ask for more money and/or different terms. Use your investments into the company (both cash and effort) as bargaining chips to seek a more acceptable offer. If the company is worth little, ask for assets of the business: a company vehicle, office furniture, inventory or a computer. Anything may be accepted as compensation.
If you can't agree on an offer, you can always cease working for the business and keep your interest as a future investment. However, if things have gone bad between you and the partners, it is probably wise to find some sort of acceptable exit.