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V

valb

Guest
What is the name of your state? NJ

Closely held S-corp started with 3 equal partners applies and receives credit line. During application bank requires all partners to pledge personal assets as collateral. Now, one of the partners waants to assume 'silent' status or even exit the business. Along with that, partner no longer wants to pledge his personal assets as a colateral of credit line.

Questions: Can this partner force the credit line termination? Can partner own substantial number of shares 33% and not be included in credit / loan applications filled by business?
 


JETX

Senior Member
"Can this partner force the credit line termination?"
*** A current 'personal guarantor' cannot just remove himself from the obligation he signed. Any modification to the agreement must be done with the approval of ALL parties to the agreement.

"Can partner own substantial number of shares 33% and not be included in credit / loan applications filled by business?""
*** That would depend on the policies of the lender as to who (or how many) must sign the person guarantee.
 

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