• Last Updated:
  • Jan 7th, 2019 9:20 pm
Tags:
[OP]
Newbie
Dec 10, 2018
3 posts
1 upvote

Leaving business, next steps

I'm a partner in a small business (incorporation). I am leaving the business and need advice on the next steps. If anyone has experience or any know how or online resources that they can pass along, that will be great.
We have a warehouse lease, a van lease and a bank account under both our names. Should I remove my name from the official Government of Canada Incorp documents first or should I remove my name from the leases and bank account first?
11 replies
Deal Guru
Aug 2, 2010
14328 posts
4189 upvotes
Here 'n There
If you signed a lease you just can't 'remove' your name from it unless the other party to the lease releases you from it as it is an obligation you committed to. Also, you also cannot just 'remove' your name from incorporation documents nor is there any need to. As for the bank account if it is a joint bank account go to the bank and ask them to take your name off it.
[OP]
Newbie
Dec 10, 2018
3 posts
1 upvote
I'm leaving on good terms and there is no issue with removing my name from the lease as the company is in good standing with all bills and never had an issue with payments to the landlord.

Removing your name from the Official Incorp government docs is very important and is a must and I found out you can do that with a phone call (1-800-959-5525) and do this before you contact the CRA to let them know you have left the company as well.

Once I'm done I'll update this thread with any new findings or important steps that i had to go through to help out anyone in the future.
Deal Guru
Aug 2, 2010
14328 posts
4189 upvotes
Here 'n There
aka1khalid wrote:
Dec 14th, 2018 9:48 am
I'm leaving on good terms and there is no issue with removing my name from the lease as the company is in good standing with all bills and never had an issue with payments to the landlord.

Removing your name from the Official Incorp government docs is very important and is a must and I found out you can do that with a phone call (1-800-959-5525) and do this before you contact the CRA to let them know you have left the company as well.

Once I'm done I'll update this thread with any new findings or important steps that i had to go through to help out anyone in the future.
Leases: It does not matter if you are leaving on good terms with your partners or if you never had issues with the landlord. You cannot do it unilaterally. Have the landlord and van lessee agreed to release you in writing as a party to the agreements? Personally, if I was either I would never release anyone from the agreement. You have no right to be released, regardless of whether you leave on good terms with your partners, landlord or lessee. That means nothing with respect to whether the payments agreed to by you and your partner will continue when you are gone. Having been successful suing parties based on an agreement and then having to search for their assets to execute upon them the more security you have the better. Landlords and rental companies know that.

Incorp Documents: You cannot remove your name from the incorporation documents, which is what you asked about. If you are talking about removing yourself as director, officer, contact person, etc, on the corporation records, which is something entirely different than the 'incorporation documents' of course you have to update the government records in your filings. That will not change what was on the incorporation documents.

Bank Account: Easy if there you are not a personal guarantor on a loan on the account. If you are it is highly unlikely the bank will release you as they are masters in ensuring they have the most security on their loans as is possible. If there is no loan outstanding the will do so but then that will impact your partner's ability to finance as the security will be less.
Deal Addict
Sep 23, 2007
4849 posts
1017 upvotes
aka1khalid wrote:
Dec 11th, 2018 11:59 am
I'm a partner in a small business (incorporation). I am leaving the business and need advice on the next steps. If anyone has experience or any know how or online resources that they can pass along, that will be great.
We have a warehouse lease, a van lease and a bank account under both our names. Should I remove my name from the official Government of Canada Incorp documents first or should I remove my name from the leases and bank account first?
I suggest you review with your partner if there are any documents that you have signed that gave you any liabilities. You would want to be released from those in an official manner, especially when it comes to the lease.

I guess from the fact that you can "leave" you must be a minority shareholder? You used the word "partner". In a corporation there is legally no "partner". I think you mean shareholder. So you need to consult how to sell/transfer your shares. I suggest visiting a lawyer. Being an owner is not something you can just "quit". Consulting with a lawyer is the best way to ensure you find proper closure and not have some rude surprises years down the line.
Deal Addict
Apr 5, 2016
3539 posts
2203 upvotes
Calgary/Vancouver
Isn't this an easy process? Since it's an incorporation, just "sell your shares" to your partner, get a lawyer to do that and update your province or federal corporate registry.
Current Fido customer.
Ex Koodo customer.
Sr. Member
Nov 12, 2014
775 posts
520 upvotes
Kingston, ON
bomber17 wrote:
Dec 18th, 2018 12:25 am
Isn't this an easy process? Since it's an incorporation, just "sell your shares" to your partner, get a lawyer to do that and update your province or federal corporate registry.
Generally there's a shareholder agreement that deals with exit strategies...sure, he can "sell his shares" but then the other partner has to have the $ to buy them....assuming they are worth something. If they are worthless, just have the corporation redeem/cancel the shares and you're fine.
[OP]
Newbie
Dec 10, 2018
3 posts
1 upvote
Fairly easy process:

1.We spoke with landlord for warehouse lease and it was done within a day.
2. Van Lease will still be active for just a few more months until the lease is up. After they will renew the lease without me.
3. To remove your name from The Articles of Incorporation, just visit the Industry Canada website at https://www.ic.gc.ca/eic/site/cd-dgc.ns ... 07028.html then go to the bottom and click on Online Filing Centre, Form 6 View/Change Director Info (No Fee) and fill it out and they will email you confirmation within ten minutes. Print out, sign and save all sheets as necessary. Removal can be for many reasons like, death, resignation, removed by shareholders, becomes disqualified. We internally came to an agreement for my buyout so i resigned)
4. Call the CRA at 1-800-959-5525, They will verify you and check the Industry Canada records that you have been removed (The step above) and then they will remove you from all CRA records.
5. Bank will NOT remove your name without the Updated Articles of Incorporation stating you are no longer a Director, once that is done (step 3), bring your documents to the bank and you're done.

Hope this helps someone else.
Deal Addict
User avatar
Aug 15, 2015
1513 posts
192 upvotes
Markham, ON
It's nice when your partner is responsive.
Deal Guru
Aug 2, 2010
14328 posts
4189 upvotes
Here 'n There
You are not helping anyone by providing inaccurate information.
aka1khalid wrote:
Dec 27th, 2018 12:12 pm
3. To remove your name from The Articles of Incorporation, just visit the Industry Canada website at https://www.ic.gc.ca/eic/site/cd-dgc.ns ... 07028.html then go to the bottom and click on Online Filing Centre, Form 6 View/Change Director Info (No Fee) and fill it out and they will email you confirmation within ten minutes. Print out, sign and save all sheets as necessary. Removal can be for many reasons like, death, resignation, removed by shareholders, becomes disqualified. We internally came to an agreement for my buyout so i resigned)
4. Call the CRA at 1-800-959-5525, They will verify you and check the Industry Canada records that you have been removed (The step above) and then they will remove you from all CRA records.
Again, you cannot remove yourself from the Articles of Incorporation. All you can do is remove yourself as a listed officer or director of the corporation. If your name is on the Articles of Incorporation it will remain there forever. It cannot be altered. Also it is not enough to just file the form above. You must also have corporate resolutions reflecting this.
aka1khalid wrote:
Dec 27th, 2018 12:12 pm
5. Bank will NOT remove your name without the Updated Articles of Incorporation stating you are no longer a Director, once that is done (step 3), bring your documents to the bank and you're done.
Again you are wrong. There is no such thing as an 'Updated Articles of Incorporation'. They never get updated and are never get changed to say you are no longer a director. A 'Shareholders' Resolution' does that and it has absolutely nothing to do with the Articles of Incorporation that are preserved intact forever.
Deal Addict
User avatar
Aug 15, 2015
1513 posts
192 upvotes
Markham, ON
You chose a good time to leave. Everything seems in order. In your leaving agreement all verbal? Are you gonna so anything to verify that your name is really off all the leases in the renewals?
Sr. Member
Jun 13, 2018
579 posts
422 upvotes
eonibm wrote:
Dec 27th, 2018 7:48 pm
You are not helping anyone by providing inaccurate information.



Again, you cannot remove yourself from the Articles of Incorporation. All you can do is remove yourself as a listed officer or director of the corporation. If your name is on the Articles of Incorporation it will remain there forever. It cannot be altered. Also it is not enough to just file the form above. You must also have corporate resolutions reflecting this.



Again you are wrong. There is no such thing as an 'Updated Articles of Incorporation'. They never get updated and are never get changed to say you are no longer a director. A 'Shareholders' Resolution' does that and it has absolutely nothing to do with the Articles of Incorporation that are preserved intact forever.
Yeah it does look like the OP is trying to create a scenario, then claim to have solved it. A lot of false info was posted.

Top