Forums: Discussions for entrepreneurs and small business.

Hey Everyone.

I could swear I read this somewhere and I just can`t find it.

Say for instance you and another person have worked to develop a business but have reached a point where you need someones expertise. Your budget is small but the idea has tons of potential and that person wants to become a partner. What is the best way of adding the person to your business and making sure that he/she will perform at the level promised. We currently have an LLC and would have to restructure our shares...is there a clause we can insert saying that they must meet certain goals before they can receive shares (is it fair if the person is not receiving any salary?)

What is the best way of handling this situation?

Any help will be appreciated.

Hi Rzvagelsky,

Don`t know what thread you are referring to when you say you`ve seen this before, so this may not be the response you are looking for.

It would appear to me that the method you are looking for is vested stock options, it gives the employee the option to buy-in into the company at a set price and it allows you (the employer) to control how much of that he can buy at any given time. Also, if he leaves the company all options that have not been vested become void.
Introduction to stock options