posted: May. 11, 2013 @ 5:29p
I owned a business, had an office, employees, etc. I did this for 8 years. I was good to my employees and business was good while it lasted.
We hired a person about 2 years before closing - an older mature gentleman - to do IT work for us, who was also working on his own business but needed some part-time work to supplement his income. We became fast friends because of our common interests.
He asked me to invest in his business several times; I politely declined. His business was exploding at the time...he needed help. I thought he was a great guy, felt bad for his limited resources and would offer him lots of good advice but felt uneasy about giving up cash since I needed it for my own business.
At one point, my business was slowing down and his was gaining a lot of momentum. He came to me with a different idea...to share a FT employee with me so I could keep her and she could stay busy and, in exchange, I would get an equity stake in his business. He also agreed to a 24-month buyout clause because I was nervous about the state of affairs in my business. We drew up a contract and were good to go. I was happy that everyone was happy. Things went pretty well and I made sure we had lots of emails and a contract to protect us both.
The buyout clause stated that, if at anytime during the 24 months, I wanted out of the investment, he would pay me a lump-sum amount for every month the resource was provided.
Things steadily got slower with my business and 12 months after the contract was signed, I decided to close on my business. It was tough. I had to layoff employees, clean up the office, get rid of supplies and equipment. As part of this, I told him I wanted out of the contract which resulted in a buyout payment to me of $40k. I felt bad that I was abandoning him, but I hung in there as long as I could.
Keep in mind, his business is probably worth about $5m today but I still want nothing to do with it. As it was starting to grow for him and money became big, he changed and things were stressful. I decided I would just rather bail and say "good riddance" to him.
After telling him I wanted out, 30 days later he still hadn't said anything about re-payment, so I sent a follow-up email. He flipped out, ugly words were said and he came up with many reasons why he should not pay back the full value of the contract.
Now, he had provided a laundry list of "expenses" that I owe to the tune of $4,000 and he tells me he's not going to pay me a dime until "we" agree on the matters. These "expenses" include his time in getting his belongings from our office after we closed the business (he valued himself at $50/hour and said it resulted in 12 hours of work) and reimbursement for a $100 gift card (with a greeting card) that he gave to me for helping him out of a tough situation.
The amount is too big for small claims. Unless I agree to the $36,000, he will not pay me a dime. His expenses are frivolous and wouldn't hold up in small claims court. Can I somehow agree to his demands, but then sue him after I have the $36k in hand? Otherwise, I think i will have to get an attorney and that is going to be costly.
I spent a lot trying to close my business and liquidate everyhing and have limited funds these days, so this is causing a lot of stress.
8 years and I never needed one and now this. What a bummer!!!
Isn't what he's doing blackmail? If I don't agree to his demands, he won't pay me anything? I'm assuming if I verbally agree, he is going to want something signed with me stating I won't sue him.