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Stay in business and Dissolve LLC partnership
South Bend, IN
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Posted about 1 month ago in Limited Liability Company (LLC)
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I want to get out of an LLC as my partner is doing nothing to help grow the company (he took another job). When we formed we listed ourselves and wifes as partners.
I am the only person involved in this venture with the skills to run this business and my partner's wife is essentially a stay at home mother of 5 with a High School diploma. We currently have no clients but the potential is there and frankly I don't feel like giving away the fruits of my labor with them doing nothing... I want to run as either a DBA or form another LLC. How can I do this with the least amount of "pain"? Answers (2)
Andrew Daniel Myers
This attorney is licensed in Massachusetts and 1 other state.
Posted about 1 month ago.
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The best way to do it is to change the LLC by having the "partners" sign a consent to terminate their status as owners/members. Then do an amended or new LLC Operating Agreement deleting their names. Then, review the filings with the secretary of state to make sure none of them signed any of them in any capacity. If they did, you'll have to do amended filings.
That's the easy way. If they do not agree to get out of the LLC, and if you can not negotiate with them to get out of the LLC, then you will need to look at your LLC Operating Agreement to determine what, if any procedures you need to go through to resign. If you do not have an LLC Operating Agreement or if your agreement does not have terms for your resignation and separation from the LLC then look at your state's LLC Act for any requirements and follow then in order to resign from the LLC. Then, start a new LLC. Of course before you do you should check your LLC Agreement or any other documents to see if there is a non compete agreement. This answer is provided for informational purposes only. Legal advice can only be given in an office appointment by an attorney licensed in your jurisdiction with experience in the area in which your concern lies.
Andrew Daniel Myers
This attorney is licensed in Massachusetts and 1 other state.
Posted about 1 month ago.
Flag as objectionable
The best way to do it is to change the LLC by having the "partners", actually in an LLC we call them "members" sign a consent to terminate their status as owners/members. Then do an amended or new LLC Operating Agreement deleting their names and revoking the old LLC Operating Agreement. Then, review the filings with the secretary of state to make sure none of them signed any of the documents filed there in any capacity. If they did, you'll have to do amended filings.
That's the easy way. If they do not agree to get out of the LLC, and if you can not negotiate with them to get them to relinquish their roles in the LLC, then you will need to look at your LLC Operating Agreement to determine what, if any procedures you need to go through to resign. If you do not have an LLC Operating Agreement or if your agreement does not have terms for your resignation and separation from the LLC then look at your state's LLC Act for any requirements and follow then in order to resign from the LLC. Then, start a new LLC. Of course before you do you should check your LLC Agreement or any other documents to see if there is a non compete agreement between you and the other members. This answer is provided for informational purposes only. Legal advice can only be given in an office appointment by an attorney licensed in your jurisdiction with experience in the area in which your concern lies. |
