Business owners are, by their nature, busy.
They expend their energy planning for the growth of their enterprise, the happiness of their employees, the risks of an ever-evolving market, all the while managing risk and expense.
However, many owners fail to adequately plan for their own eventual transitions out of their businesses.
A business exit can take many forms – owners might turn management over to their children, sell to a select group of loyal and key employees, or market their equity or the business’ assets to outside buyers for the highest dollar.
Each situation involves its own financial (as well as non-monetary), considerations, risks, and rewards.
At Bulman, Dunie, Burke, and Feld, our attorneys help advise our business clients by asking a very basic question: what do you want your business legacy to be?
Each client may answer that question differently, and we work with each client to craft succession plans that meet their personal goals. If that goal is to keep the business “in the family” by passing control over to the next generation, our attorneys can help craft earn-in arrangements and assist with transition planning, all while keeping sufficient guardrails in place to maintain sufficient control and accountability during the changeover process. If a client’s goal is an exit through an outside sale event, we can assist by conducting internal due diligence and “corporate cleanup” in preparation for a sale, advising with respect to transaction structuring, and negotiating legal protections to minimize disputes once new ownership is in place.
Where a business has multiple unrelated owners, the death or sudden retirement of one owner can wreak havoc. Our attorneys frequently advise clients with respect to alternative buy-out arrangements (such as in the case of the sudden death, disability, or retirement of a business owner) to mitigate the risk of a sudden loss of an owner.
Our broad range of succession planning services includes:
- Negotiating and drafting operating agreements, shareholder agreements, and buy-sell arrangements to plan for the foreseen or unforeseen departure of one or more business owners;
- Conducting internal due diligence to identify and remedy potential compliance problems and risks in advance of current ownership’s exit;
- Advising with respect to terms and provisions of management transition agreements (such as employee equity awards, purchase agreements, and “earn-in” agreements);
- Negotiating and drafting both equity and asset sale agreements;
- Estate planning solutions to accompany one or more of the foregoing and ensure transition goals are met following the death of an owner.
