Marital problems for business owners often create uncertainty for their business partners and sometimes the entire enterprise. Ideally, entrepreneurs in Kentucky will have addressed the topic of business partner divorce when crafting the agreements that formed the company. In the absence of planning for the possibility of a business partner’s divorce, you and your former spouse will have to work out how to approach the division of business assets from scratch.
Under almost all circumstances, you will need to complete a valuation of your business’s assets and liabilities. These figures build the foundation for making accurate financial decisions about what exactly is being divided. Additionally, the current financial status of the business could provide evidence to prove claims you might have to raise about a division of assets harming a company’s interests. This information could support the development of compromises that do not force the sale of assets or overly threaten business operations.
The role of a shareholder agreement
If you are contemplating divorce, then you should review the shareholder agreement for your company to see what it has to say about divorce. You and your partners may have already worked out in writing what valuation method should be used during a divorce. Additionally, the agreement will state your share of income as a partner. This percentage will be applicable during your divorce proceedings to determine what you and your spouse will have to split.
Planning the divorce
Even if the founding documents for your company address what to do in the event of a partner’s divorce, the advice of a family law attorney may be needed to navigate the details. You might gain insights about how a prenuptial agreement intersects with your shareholder agreement. This information may guide your negotiations with a former partner and help you limit litigation and business disruption.