Denver Business Succession and Exit Planning Attorney
Our Denver Business Succession Lawyers Will Help You Face Challenges
Owners of small to medium-sized businesses face unique challenges when searching for the best way to transfer their business. This can happen when the owner is ready to retire or when the owner becomes disabled or dies. Some will look for ways to transfer the business to family members, and others will have key employees transition into ownership. Some companies might decide to sell to third-party buyers.
At Brady, McFarland & Lord, LLC, our buisness succession attorneys have been helping business owners with this process for decades. We are always here to help you. Call our office at (303) 420-2863 or contact us online for a free initial interview.
How a Denver Business Succession and Exit Planning Lawyer Can Help
There are many ways to plan for retirement or to transfer a business when the owner passes away. When you hire the right lawyer, they will work with you to find the best succession methods so that all of your goals are met. It’s important to find the best firm to help you decide what is the best way for your business to continue on in the future without you, something we all eventually need to deal with.
What Is a Succession Plan?
Think of a succession plan for a business as you would consider a will for an individual. It is a set of legal documents that covers all the instructions and maps out the proper steps for the transfer of ownership of your business. Maybe employees will be stepping into ownership roles or family members will take the reins. The succession plan will detail what to do with the business if the owner is no longer able to care for the company as a result of death, disability, or retirement. The plan should clearly state how the business owner will transition the business into new management, and who will be running things going forward. An experienced Denver business succession and exit planning attorney can help you with all of these plans.
When Should I Create a Succession Plan?
It’s essential to execute a succession plan long before you plan to retire. That way, it’s in place if something happens to you and you’re no longer able to take care of your business. While most of us don’t want to consider the possibility that something bad might occur to us that will render us unfit to care for our business, it’s important to make sure we have everything sorted out before that happens.
Also, a succession plan needs to change over time, as your needs as an owner might be quite different when you are younger compared to how things might transfer when you are much older. A good attorney will know how to craft a succession plan properly in its relation to time. Before you create a succession plan, you should consider the following questions so you and your attorney can develop the plan that you want together.
When Do You Want the Business to Transfer?
When do you want the transfer to happen? When you turn a certain age? Once you pass away? What if you’re temporarily incapacitated? Are there plans for a temporary transfer in case of a short-term emergency? It’s easy to see why an excellent business succession lawyer’s advice is required to help you deal with the many options available in an ownership succession plan.
To Whom Do You Wish to Transfer the Business?
This is a crucial decision to make while you’re mentally and physically healthy. You’ve likely worked very hard to make your business successful. Ideally, you want to decide how things are handled when you are gone. The right lawyer will help create these complex legal arrangements. Do you wish to transfer ownership to one person? Multiple people?
How Will the Transfer Take Place?
Will you transfer a percentage of the business or ownership shares? How will the transfer be structured?
What’s in a Succession Plan?
Some examples of the terms in a business succession plan include the following:
Sell Shares to Co-Owner
If an owner passes away, it’s common for a succession plan to include instructions to sell back the deceased owner’s shares to a co-owner. The executor would then be able to use the proceeds from the sale to help the decedent’s family.
Take Over Shares
Another common term in a succession plan is to have a family member take over the deceased owner’s shares in the company. The owner can choose to give the shares to anyone they wish; they just have to be specific about it in the plan.
We Can Help With All of Your Business Planning Needs
There is no one size fits all solution for the transfer of a business, but there are a number of different approaches. For example, selling the business for the highest price may not bring the owner the greatest value. Taxes, the time value of money, and other factors can make the highest bidder the least attractive solution. There are several effective tools and techniques that can maximize value.
One thing that does apply almost universally is that the sooner you start to plan, the better the result. We recommend a business owner start the discussion as early as ten years away from retirement, even if most of the planning and implementation may not take place until 3-5 years before the owner intends to reduce his or her role in the business. Contact us today to schedule a no-charge consultation about transferring your business. You can call us at (303) 420-2863 or contact us online for a free initial interview.