CC Members no longer getting along

**BusFact** · 27-Oct-11, 11:36 AM

I think Dave's advice in the previous post is the best option. Ultimately its down to negotiation and who has the most convincing argument.

Another point to consider is that if the cc is insolvent and is liquidated, the departing member may also be held personally liable for some of the cc's debts. Its not a common scenario but can be a result due to trading "recklessly".

My biggest concern is that the departing member either believes that there is R50k to pay him or he is just being malicious. Either way he may not budge and if the cc or the remaining mambers can't afford it, then its the liquidation route and all the unhappiness that follows from that.

**Justloadit** · 27-Oct-11, 02:24 PM

I do not know where this so called entitlement comes when one member wishes to pull out when the road gets bumpy.

If he wants to pull out, he can do so by everyone signing an agreement, that if he pulls out with no cash in or out, that the company will not pursue him in the future for outstanding debt, and in turn, he will not sue the company for monies owed when it does well. Make sure you get a lawyer to draw up the agreement, you definitely do not want a loop hole.

The option of liquidation means that everyone has to service the loan by a third of the value as members of the CC

Ya can't have the cake and cherry and eat it. I have done the above before.

**BusFact** · 28-Oct-11, 01:43 PM

Originally Posted by Justloadit

I do not know where this so called entitlement comes when one member wishes to pull out when the road gets bumpy.

People do strange things when under financial pressure. Perhaps a bit of desperation? Sometimes a little vindictiveness thrown in.

Also a poor understanding of the different roles of shares and loans.

But then again your question was probably rhetorical

**SilverNodashi** · 28-Oct-11, 04:09 PM

My wife recently got into a problem like this, where they (she and her business partner) took on a 3rd partner, as investor, with the hopes that the extra money could escalate marketing and thus sales as well. Sadly though, the new member was simply too greedy and wanted to own the whole company and rules everyone with an iron fist. None of the clients or equipment they have acquired upto this point belongs to him and his financial input was only worth about 40% of their total assets. Long story short, she pulled out, and the other partner is facing total meltdown.

Any person turns into an A55h0le when it comes to money and ownership thereoff.

My advice (which isn't legally binding) is to liquidate the CC, and do something else to keep the money coming in instead. Start a new CC, with just the 2 members, and tell the clients / suppliers / etc to use the new CC for all new business instead, and let the old CC run aground with no funding.