Too many business owners have overlooked the possibility of determining what happens to their company if they were to suddenly need to exit due to incapacity, illness, or their own death. The process of business succession planning or business exit planning can help you articulate your wishes and ensure that the business is not interrupted by one of these sudden events.
A business succession plan is your first option which provides you and your family a way to move forward if you choose to keep the business in the family or passed on to another employee currently in the company after you are no longer able or willing to stay on in leadership.Â
A Pasadena business succession planning lawyer’s help to create this plan will allow you to memorialize the circumstances and timing under which you can withdraw from your company and what happens next. For example, you may wish to remain part-time as a consultant or be involved in its direction on an ongoing basis and your California business succession plan can offer clarity on these intentions. You can name things such as who will assume control of the business which can limit conflict among family members or remaining leadership team members.
If you have decided, however, that you do not want to keep your business in the family, you can create a business exit plan. This allows you to step down through a winding down of the business, a transfer of ownership to the business through an employee stock ownership plan, or the sale of the business. You could also lay out a sale to other family members or your children using an intra-family loan. Because there are so many complex issues involved in the estate planning process, it is best to work with a business succession lawyer today.
