Business Succession Planning
The death of a partner or major stockholder in a business can have devastating effects on both the business and the deceased partner’s surviving family. The business is concerned with gaining control of the deceased partner’s interest at a fair price so that it can continue operations without interference from the surviving family members. The family members are most concerned with receiving as much money as possible for their interest in the business and for capital that may be needed for estate settlement purposes.
Why you need a written agreement
If you don’t have a written agreement, the competing interests of the business and the family members could lead to major conflicts, litigation and possibly the forced liquidation of the business. A buy-sell agreement can ensure that the business interest of the deceased partner will transfer in an orderly manner to the benefit and satisfaction of everyone involved. In addition to this, a buy-sell arrangement also ensures each owner that there is a buyer for their business interest at a fair price.
Business succession planning involves legal, tax and personal financial issues. Guidance from a qualified attorney or tax professional is strongly recommended.
We can help you with your business succession planning and finding best type of buy-sell agreement for everyone involved. Contact us today.