IS YOUR BUSINESS PREPARED FOR THE SUDDEN DEATH OF AN OWNER?

When Reality Hits

When a business starts out, it's often easy to believe that its owners will  be in business together forever.  Reality is quite different; A business can be seriously disrupted if a partner leaves either as a result of death, permanent disability or retirement.

Shareholder Agreements

A formal Shareholders Agreement or Buy-Sell Agreement covers the terms of ownership and operation of a business. It typically deals with the death, disability and retirement of one of the owners. It also covers how disagreements will be dealt with, how to value the business, who will buy the shares, what terms the sale will have, when the sale will take place, where the money will come from, and what the purchase price will be.

Working With your Partner's Spouse

When a business loses an owner, the remaining owners must decide how the business will continue. You can close down, you can continue with the new owner (generally the spouse of the deceased), or you can sell your shares. All of these options are typically not in your plan. Closing down is not an option. You don't believe your partner's spouse will work out. Who would be willing to buy shares when the corporation has suffered a significant setback? The value of this business to you is significantly more than to an outside player willing to buy in at a fire sale.

How to Fund a Buy-Sell Agreement

• a) Start saving today
• b) Borrow the necessary funds at the time
• c) Take funds from current earnings
• d) Sell shares
• e) Purchase life and disability insurance to provide funds when needed.

Your options are limited by the very circumstances that created the need. The one truly cost effective method of funding a shareholder or a buy-sell agreement is with insurance.

A plan that fits your needs today is flexible enough to meet your growth requirements tomorrow, has enough features to provide a custom solution and, finally, is priced right!

Call today for your personalized plan.