Dallas Business Attorney: Setting the Course for Your Business Exit
Posted on | September 30, 2011 | No Comments
Dallas Business Attorney: Setting the Course for Your Business Exit
In order to grow a successful business venture it is important to have a solid business plan. In order to have a solid business plan, it is necessary to have an exit strategy that covers the Four D’s: Death, Disability, Divorce and Departure. In the end, every business owner will have to exit his or her business, either voluntarily or by death or disability. If there is no exit plan and a partner departs, the business may be forced to liquidate its assets and windup. Therefore, it is important to have a succession plan to assure that the business continues and thrives after the exit.
Buy/sell agreements are an essential tool in the start of a new venture. Well-drafted agreements will handle the issues that may arise due to an unexpected exit of a member. Among the issues that should be covered are:
- Death: A section allowing for a buyout of a deceased partner’s share of the business, which often is funded by a life insurance policy.
- Disability: A provision regarding disability insurance and whether it will be paid by the company or the partner individually.
- Divorce: Provisions that restrict the shares of a partner that pass unintentionally to a third party, such as a recently divorced spouse.
- Departure: A provision that allows for a buyout of the departed partner’s share, or in the alternative, a provision naming a successor partner.
Like a last will and testament, a well written buy/sell agreement can give the partners peace of mind that their family members and partners will be taken care of and that the business will continue on in case of an unexpected exit.
If you are thinking of starting your own business or need help in drafting a buy/sell agreement, please contact The Wright Firm, LLP today at 972-353-4600 or visit our website at www.thewrightlawyers.com.
Tags: Business Exit > Buy/Sell Agreement > Dallas Business Attorney > Dallas Business Lawyer > Denton Business Lawyer > Lewisville Business Attorney > Lewisville Business Lawyer > The Wright Firm
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