Want out of my business

Hello,
I have been an owner in an llc for over 3 years. The business is still not turning a profit. There are three owners. I explained that we need to either; try to sell the business or bankrupt it. Two of us want to sell our shares of the business, however, the other owner isnt willing to sell their shares or bankrupt the company. That owner is now running the business (which I did entirely by myself for the past three years). That owner took out a business loan and is paying debt from it. That owner is alos using the business account for frivilous spending for things that are unnecessary and unrelated to the business (like decor, etc). Now, that owner is telling us that we are liable for the costs that they are having to pay for (although it is out of a business account that was opened under their name but our llc).

If I want to sell and that owner cant find another buyer, can they continue to accue debt that I am personally liable for, or is it the business that is liable for the accuring debt? I already contributed a lot of startup money but I never agreed to contribute any more than I already have? Please give me ANY insight as to what to do?

Well, how did you start your business? An LLC, a partnership, in one person's name, as a corporation? Do you have a partnership agreement just for shares and initial contribution, or did you make an operating agreement? Each state has laws governing partnerships that are based on a federal guideline law and is usually modified by the state legislature based on that state's ideals. If it is an LLC, you have different rules in the "no written operating agreement" category that can be read straight out of the statutes for that state... same for a general partnership... but if it is in one person's name, you better have a written agreement. If it is a corporation, it has to have some kind of written bylaws or you have to read your state's statutes. Sometimes you have to read the caselaw for that state to see how that state treats these questions... sometimes they do treat them differently.

If you have no agreement and it is a simple general partnership, you could have a problem because debts in the company name must be covered by the partners, so you could lose whatever debt he has built up plus your own investment. If it is an LLC, the partners are protected and cannot be forced to pay for another partner's committed purchases... that is what is so good about the LLC. If it is in one person's name, that person will have to pay the bills. If it is a corporation, the shareholders are protected... but they might lose their share value at a max.

I don't recommend going bankrupt. I do recommend getting an agreement written asap, especially on how to decide when to call it quits. Two partners could form a block against the operating partner but you would have to give him the right to purchase the business from you at whatever market rate there might be... NOT BASED on what you have in it. If he is buying stuff under the company name and it is NOT an LLC, you should get an attorney forthwith to STOP him from frivolous spending... sue him or something... to kill this little fiefdom. To get the fast answer you seem to need in this out of control situation, I recommend getting a lawyer... but get your company papers together and do a couple of hours research. Find out how your company is registered with the state... what kind of company? Then look up key words of that KIND of Company in the state statutes until you find the details on operating agreements in that state that are the default used when there is no agreement if you have no agreement. Like I mentioned before, each state has a set of default agreements and statutes to guide the operation of undocumented companies. You need to know how your company was registered with the state and whether there is any operating agreement/ bylaws. Then you should take that to the lawyer and ask your questions... but read those default agreements even if you HAVE an agreement. Whoever wrote your agreement might have left out the good paragraphs and left you unprotected with no means of resolution.

So get a good agreement made and signed asap... THEN Kill the company if it is still a mess with no profit. Find out first how to stop the profligate spending.