Have you taken the steps necessary to protect the value of your business?
I hope so.
Our client in the heating & cooling industry did just that. And were grateful they had when a shareholder passed unexpectedly without illness or warning.
You see they had the "trifecta" in place:
1. A trusted business attorney who had prepared and executed Shareholder Redemption Agreements.
2. A trusted CPA (us) who had prepared a Business Valuation.
3. A life insurance policy on the lives of each shareholder in an amount commensurate with their ownership value.
Upon the unexpected passing the life insurance proceeds settled the value of the shareholder's ownership. Not only did the Company not have to deplete cash or leverage its future via borrowing it was able to maintain a "A" rated balance sheet. In addition, the proceeds paid out to the beneficiary of the shareholder were "tax free."
No arguments regarding value; no litigation; no waiting on a payment.
Have you taken the steps necessary to protect the value of your business?