He may be unrealistic, but he's right. If he's 25% owner of the LLC, and you truly want to eliminate his equity position (as opposed to just his work for the company), then you need to follow proper procedures for buy-out. Check operating agreement and if no OA (or OA is silent) then LLC Act.
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Tom Gimer, Esq. -- licensed in DC and MD -- 202.556.4LAW (4529)
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I recommend that you consult with an attorney. I have helped clients negotiate a number of these matters with some success--especially in small businesses where one person and their capital investment is key to the success of the business. The first place we start is a review of the governing documents (operating agreement, articles, offering documents, etc.). If there are provisions is those documents, negotiate using them (or around them, if necessary). If you have no operating agreement, you default to the provisions of the Utah Code. If you are a majority owner, put the most in, etc., I think it is very likely that you can find a way to buy him out, or drive down the value of his ownership interest, or discourage him from pursuing the aggressive buyout he apparently wants. You need to be careful to avoid problems (e.g., a lawsuit against you), but it is likely you can find a way to deal with him on terms acceptable to you.
Gather your documents and consult with an attorney.
JASON C. HUNTER
Salt Lake City Office:
299 South Main Street, Suite 1710
Salt Lake City, UT 84111
2610 Washington Boulevard
Ogden, UT 84401