Congratulations on taking the first step to protect your interest in your co-owned business. Business Succession Planning is essential for protecting your interest in a co-owned business and is an integral part of every business co-owner’s individual Estate Planning.
“Business Succession Planning” means:
- Planning for the sale or purchase of a co-owners’ interest in a business in the event of their death, permanent disablement, serious illness/trauma or other circumstances and funding for that sale/purchase, (See Buy/Sell Option Agreements below), and
- Planning for the preservation and growth of co-owners’ equity in a business by the implementation of agreements between co-owners governing the management and decision making of the business and ability to dispose of an interest/share (See Shareholders’ Agreements below).
Problems associated with a business co-owner suffering an untimely death or injury, as well as disputes between co-owners, both of which often lead to the financial ruin of a business, can be managed or avoided by the consideration and implementation of suitable Business Succession Planning Agreements and related insurances. The avoidance of these problems will ultimately protect you and your family and preserve your Estate assets.
Where to Start?
If you are a co-owner of a business you should at the very least consider the benefits for you and your family of having proper Business Succession Planning Agreements in place.