[seanrrwilkins]

I recommend reducing the equity stake to something like 5% now, with an expiration of 5 years.

This should be small enough that it won't effect him or the bottom line for the business, but provide value to you in the long term if the business does sell or raise significant money.

If you want to retain a working relationship with Jim, and keep some interest in this company moving forward, it sounds like the responsibility is on you, based on the way Jim countered.

Otherwise, it might just be that you walk away and take a hit, but you gain a valuable lesson for next time. Always have a written operating agreement to define how you will both act in situations like this. Codify the ins and outs from the beginning, get it on paper and take the emotion out of the process should you need to separate later.

[mickeyM]

That's right, lesson learned :)

I would agree with such an equity stake & expiration, that sounds reasonable