If you have a family-owned business and are going through a divorce, you might find that determining the outcome of the company is one of the more difficult decisions you have to make. There are several options that are on the table for most companies. One of the first things that you have to think about is whether you and your ex can realistically continue to run the company together even though you won’t be married any longer.
Sometimes, divorced couples can continue to work as a team with clearly defined roles. If this is the case, you need to get an agreement in writing about everything from the roles each of you will fill to the pay structure that will be utilized. Including terms about conflict resolution is also beneficial.
When you and your ex can’t work as a team to continue to run the company, there are three options possible. These include:
- One person buys the other out: This only works if you can come to an agreement about the terms of the buyout.
- Sell the company: You need a valuation of the business and to find an interested and qualified buyer. You’ll have to set the terms to split the profit from the sale.
- Dissolve the company: This option works for a company that isn’t in a position for a sale. Discuss how the debts will be handled.
Remember, determining what to do with the business is only one thing you’ll have to figure out when you divorce. Taking the time to work through everything can save you from making rash decisions that aren’t in your best interests.