1) Approach Xbf on our financial situation & ask that he prepare himself & move forward with me or that I will be contacting a lawyer to proceed next week.
Isn't this about securing and separating your financial part of the business from him? Why would you tell him to prepare himself and move forward with you or else? It sounds like a threat.
Keep the business and personal lives separated.
It is not about what you feel should work in your M. It is about doing the work that gets the right results. Do what works!