There is no contract so he isn't entitled to anything. To be on the safe side, you need to make sure that none of his work is used by the company. Eg redesign the logo. If you must use it, find a way to pay him for it. Form the company with just you and the existing IP asap.
FranksTV|3 years ago
The real problem is that this relationship (and it's unresolved status) would need to be disclosed to future investors.
The best solution is to come to a reasonable agreement with the person about exiting them with some compensation for their work that is reasonable.
Walking away entirely is definitely possible, but it exposes the company to future liability, so it's worth cleaning up properly.