I think you need to be realistic about the valuation of the company, and take it from there. I may have spent 10,000 hours perfecting my basket weaving technique and business, but if I can only sell my business for $1, that's what it's worth.
You may feel the value is yet to be realized, but then you should probably stick with the company. Jim's planning to do that, I assume because he thinks his future efforts in addition to what's already been done will make it valuable.
One other thing I'll throw out there. In general, maintaining a complex cap table for an early-stage company is very bad. Jim will have a devil of a time getting investment or funding when he has a 40% share holder who is no longer involved. The optics are bad and will spoil the deal. Given that, I'd consider being willing to part ways for future cash, perhaps cash payable upon closing the first $X in deals or something. Basically converting your equity to debt.
You may feel the value is yet to be realized, but then you should probably stick with the company. Jim's planning to do that, I assume because he thinks his future efforts in addition to what's already been done will make it valuable.
One other thing I'll throw out there. In general, maintaining a complex cap table for an early-stage company is very bad. Jim will have a devil of a time getting investment or funding when he has a 40% share holder who is no longer involved. The optics are bad and will spoil the deal. Given that, I'd consider being willing to part ways for future cash, perhaps cash payable upon closing the first $X in deals or something. Basically converting your equity to debt.