Moreton Financial Solutions: Business Succession Planning
It is estimated that 90% of businesses in the United States are closely held, and only 25% to 30% of them have a succession plan in place. As a result, only 30% continue to the second generation, and less than 10% make it to a third generation.
No closely held business, or family business, wants to be in the realm of struggling to maintain control of the business they have worked so hard to build. It is a sad fact, however, that many are.
Unfortunately, planning for the succession of a business is often overlooked by busy owners. Taking time to develop a business succession plan may save a family held or closely held business in a time of transition. A buy-sell agreement is the cornerstone of a business succession plan. It sets out the rights and responsibilities of the owners and can address timing, terms and funding of a purchase or sale.
There are several ways to structure a buy-sell agreement and meet the needs of all parties involved. Two common types are a Cross-Purchase Agreement or a Stock Redemption (Entity Purchase) Agreement.
If you think you would benefit from Moreton Financial Solutions’ business planning expertise, please call Ric Tanner or Scott Ulbrich today!
Ric Tanner: 801-715-7074, rtanner@moreton.com
Scott Ulbrich: 801-715-7032, sulbrich@moreton.com