EDIT TITLE: is it possible to own percentage of profit but not ownership I joined my friend's business. I own 30 percent of the profit he owns 70 percent of the profit. But my friend owns 100% of the business. This is our contract. Is this possible?
Well, The ownership interests in a tenancy in common are more often than not equal, but they need not necessarily be equal.
do you have a contract or is it just a verbal deal between you and him? It is possible for you to not have ownership but still have a share of the profit if you sign a contract with his company, specificly saying you get a percent of the profit in exchange for some service you provide. But frankly, the best solution is to just get 30% of the company's shares.
Hi! You must put an agreement like that in writing. Are you expected to work to earn your part of the earnings? I'd be very wary of this..if I were you. If you are expected to contribute funds..make sure you have a receipt and everything. As I said..I'd be very careful of this. Bryon
Yes its possible. In fact i'm earning it without any invest. Every month my client pay me 50% of the earning from forex that i help him trade. I not invest single cent but all investment is paid by my client.
Well then you should have a skill that your friend really needs otherwise, i think its not fun if he cuts you out later.
I joined my friend's business. I own 30 percent of the profit he owns 70 percent of the profit. But my friend owns 100% of the business. This is our contract. Is this possible? I think it is possible depends on agreement. It's all about trust and a win-win solution way! Ask yourself: 1. How much is his/her investments. Do they have assets involved in the biz? 2. How long has he been doing this biz? 3. How do you get in his/her biz? Do you offering to them or do they asking you to get in his/her biz.
It sounds like you have a direct compensation agreement whereby you get 30% of the profits as glorified pay. You have no equity (ownership). For you to officially own equity you must own shares of the corporate entity. You could also synthetically have ownership if the current owner created a written agreement with you giving you an option to buy 30% of the equity valid for X years.
I would honestly run it by a lawyer or something, i remember reading some where that depending on the circumstances, partners may be held liability so if he gets into debt u may be liable......of course i dont know the exact circumstances, but i wouldn't take chances
It is possible but be sure to put it in writing so as to avoid complications in cases circumstances would arise. It would be a form of partnership. Others would do like, one partner is the capitalist partner while the other is the industrial partner and somehow will do a profit sharing same as yours.