QUESTION

How do I find out if an officer that I added to my corporation is entitled to any assets of the business?

Asked on Nov 08th, 2017 on Corporate Law - Florida
More details to this question:
I added an officer to my S Corp, real estate office in Florida a couple of years ago, as a managing broker and named her VP. She is now she is under the impression that she is entitled to half of everything if she leaves the business. We did have a handshake agreement to be partners in the business but the Corporation is one that I founded and I intend to keep the company name when she leaves.
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1 ANSWER

Alternative Dispute Resolution Attorney serving West Palm Beach, FL at Morris & Morris, P.A.
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Generally, an officer of a business does not acquire an ownership interest in the business. When you incorporated, you should have created Articles of Incorporation that spell out who owns the corporation. If you have claimed payments to her as distributions on the corporate tax return, that may muddy the waters as well as any evidence of your "handshake agreement." Oral agreements can be enforceable, but often lead to long and expensive litigation.  Partnership and employment agreements should always be in writing. If this is truly a concern for you, you should regularize the agreement by reducing it to writing. If it's going to lead to problems, then you will at least now know - before you have spent years of time and effort on the business. Good luck!
Answered on Nov 20th, 2017 at 9:11 AM

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