Business succession planning is the process through which you determine what will happen to the future of your company, as well as who may be involved in making these important decisions. If you need to exit, one way to do this is to structure a buy-sell agreement.
Your buy-sell agreement is a very important document for any business that has multiple owners. This binding agreement stipulates what happens when a business owner attempts to sell their ownership interest in the business due to specific triggering events, such as disability, divorce, or the owner’s death. This ensures that the business remains under the control of the primary and original owners and is eligible to continue operations when one of those owners is no longer involved.
A buy-sell document can cover a broad range of different types of triggering events, such as involuntary transfers, voluntary transfers, permanent or long-term disability, the death of the owner, cessation of employment, or deadlock disagreements if a triggering event occurs.
The buy-sell document dictates whether the purchase rights are optional or mandatory, who has purchasing rights, and whether or not there will be a purchase. Working with an experienced attorney to create a buy-sell agreement, as well as to cover the basics of any other business succession plan, is extremely important.
There are many unique considerations that will apply specifically to your business, and having the support of an attorney who has helped many others navigate this process before will give you peace of mind and help you make the decision that is most appropriate for your business.
Our business succession lawyers in CA help you create customized plans for your future to make the transition period easier for employees, loved ones, and customers.
