Ownership Protection

People don't plan to fail, but they typically fail to plan. This age old truth has particular relevance to owners, other than husband and wife business co-owners, where the death of an owner can result in the demise of an otherwise viable business simply because of the lack of business succession planning.

The Problem

Whilst the owners are alive they can at least negotiate a buy-out amongst themselves, for example on an owner's retirement. But what if one of them dies?

The remaining owners must now negotiate with the deceased owner's legal personal representative, who may well be more concerned about the needs of the estate than the needs of the business. Many business owners mistakenly believe that this contingency has been catered for in the business' constitutional documentation. Often there is no buy-out provision, or if there is, it's usually inefficiently drawn up and inadequately funded.

The Solution

Ownership protection can provide the continuing owners, or their nominees, with sufficient cash for the transfer of the outgoing owner's equity to the continuing owners, if a business owner dies, is disabled or suffers a critical illness.