Cindy Allen & Associates PLLC

Phone: 405-310-8673

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Divorce and a family business

Divorce, as many Oklahoma couples have found, is an often complicated, emotional process, and if the spouses own a family business, it can become even more stressful. A question often arises as to how that ownership can be addressed.

There are several options available when ex-spouses are negotiating the divorce settlement regarding the division of property. One option is for them to continue working together in the business. However, this might be too awkward and lead to tension, particularly when the exes cannot put their past differences aside. In that case, the exes can choose to sell their business and split the proceeds. This option, however, might also mean that the exes must continue to work together for some period while they attempt to sell the business, since it may be difficult to quickly find a buyer at the right price. One of the exes can also buyout the other. While the funds are not always readily available to do this, the person interested in keeping the business might be able to take out a loan.

However, couples can plan for the possibility of a divorce even before marriage, by drawing up a prenuptial agreement that clearly states how the couple will deal with the family business if they end up dissolving the marriage. Couples who choose not to write a prenup can instead set up a buy-sell contract that requires a co-owner that chooses to leave or is forced to leave the business to sell their interest back to the other party.

Dealing with a family business might require more complex property division settlement agreement negotiations, but the result may be more attractive that if it were left up to a court to decide. People who are in this type of a position may want to have legal guidance throughout the process.

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