Termination of participation of a partner in OOD

Termination of participation of a partner in OOD

 

Question:

Hello,
I would like to ask you - upon voluntary exit from a partnership, what rights does the leaving partner have - share of the profit, initial investment, etc.
Please explain how things are legal.
Thanks!

 

Answer:

Hello,

When leaving a partner, the articles of association of the company must first be reviewed, and consideration should be given to whether there are any clauses in the case that differ from the general rules under the Commercial Law. If there are none, the provisions of the Commercial Law apply - Chapter Thirteen refers to OOD, as Art. 125 determines in which cases the participation of a partner is terminated, Art. 127 refers to the size of the partners' shares, Art.

In practice, the equity of the company is estimated at a certain date (according to the balance sheet at the end of the month during which the termination occurred - Article 125, paragraph 3 of the Commercial Act).

If you own 30% of the company's equity under the partnership agreement, you are entitled to 30% of the company's equity at the end of the month in which you leave the company. With this (30%), the capital of the company upon your departure also decreased.

Another question is if you sell your units to other partners. There will no longer be a reduction in the capital of the company, but there will be a redistribution of your units among the other partners by buying and selling your units between you and the other partners. In this case, you may be looking for a price for your units around or as much as your equity interest in the company. But there is the issue of negotiating the price between the partners.

We hope we have been helpful.

Greetings!