Your family business is truly a family-owned and operated company. You and your spouse are the only two founding members. While you do have employees now that the company has grown, you are still the owners and you are both very hands-on when working at the company.
However, you’re contemplating a divorce. What does this mean for the future of your business? What options do you have? Here are a few to consider:
- You continue working together and own the business after your divorce. This may be difficult emotionally, but you get through it and remain business partners. In many ways, this is “easy” because you don’t have to worry about dividing your business interests or assets, and you don’t have to worry as much about your financial future. Your career, at least, stays the same.
- One of you sells their share to the other. You both likely own 50% of the business. You may even have a partnership agreement stating it. You can sell your 50% to your spouse, giving them complete control, or they can sell their 50% to you. The biggest issue here is if the person who wants to buy can come up with enough money to do it.
- One of you sells their share to a third party. This can get tricky because your spouse likely has to agree to the sale and help pick the new business partner. But it may be an option if they can’t buy your 50%, for instance, but you still want to sell to get out of the family business. They continue to run the company with a new partner.
- You both sell to a third party. Many couples pick this option because it is simple. Your business has grown, so it has proved its worth. You can find an investor who wants to run the company. They can buy each person’s 50% share, or you can just sell 100% control and split up the money after the fact. Either way, you both earn something for your part in the company, and you’re free to go your own way.
What should you do? Every couple has to make that decision on their own. Just make sure that you are well aware of the legal options you have as you get the process started.
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At Alward Fisher, we provide more than savvy legal representation. We provide peace of mind. Peace of mind for your business. Peace of mind for your family. And the peace of mind for your future. No matter what types of legal challenges you are facing, we can help you find solutions.