Should I Sell My Business to an Employee or Heir?


That is certainly a difficult question because you probably have an emotional attachment to these people and would like to sell it, but you, first of all, have to establish whether or not they are capable of running the business. The second most important aspect, if you care about the business and the people, is making sure that the staff that is there will continue in your absence. Frequently when you sell to an employee or to an heir you find out that you can’t, perhaps, charge the full amount for the business that you think it would bring from others. There are ways to do it with employees through ESOPs and through redemption agreements that can ease the pain of the cost of taking over the business.

© 2014 Parsonage Vandenack Williams LLC

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I’m Ready to Retire, How Do I Get Value Out of My Business?

What you want to consider when you are getting ready to retire, with respect to your business, is who your potential buyers are. Getting the right buyer is going to get you the most value out of your business, so consider whether you are looking for a third-party buyer, whether you have a child in the business who might take over, whether there are employees who might take on the business, or whether your business is one of the types that you simply maximize the income for as long as you can and then throw the keys out when you are done.

© 2014 Parsonage Vandenack Williams LLC

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How Do I Keep My Business Going in the Event of the Loss of a Partner?

It is usually important if you have partners in a business to have some type of buy-sell agreement. Partners should agree on what happens if one of them passes away, becomes disabled, or simply doesn’t want to work anymore. Usually you can fund these types of situations through insurance or through the company saving up so that if a partner does want to walk away from the business the other partner can purchase the interest and keep the business going. There are a lot of other ways to do it, but sometimes for simplicity it’s best to think about when two people come together for a partnership, you need to decide what is going to happen when they don’t want to work together anymore.

© 2014 Parsonage Vandenack Williams LLC

For more information, Contact Us