Business Succession Planning
Buy-sell arrangements, shareholders agreement exit mechanisms and structuring for the orderly transition of a business.
Planning for the Future of Your Business
Every business owner will exit at some point, either by choice or by circumstance. Succession planning works out in advance how that exit happens, who takes over and how the business continues to operate, so it is not left to be worked out under pressure.
Ownership and Management Succession
Passing on a business involves two related questions, who will own it and who will manage it, and these do not always need to be the same people. We help work through both.
Identifying Successors and Exit Options
A successor might be a family member, an existing co-owner, a management buyout or a sale to a third party. Each path has different timing, funding and documentation needs.
Putting a Succession Plan Together
Buy-Sell Arrangements
A buy-sell agreement sets out that, on a defined trigger event such as death, disability or retirement, a departing owner's interest is bought by the continuing owners on agreed terms. These sit alongside, or are built into, the shareholders or unit holders agreement.
Valuation and Funding
A workable succession plan needs a sensible valuation method and a funding mechanism, often insurance, so a buyout can actually be paid for when the trigger event occurs.
Coordinating With Estate Plans
Company shares generally pass under a will, but partnership interests, trust interests and superannuation need separate planning. We coordinate the succession plan with your will and broader estate plan so the documents work together.
Implementing and Reviewing the Plan
Once the plan is agreed, we prepare the documents needed to put it into effect and recommend it is reviewed periodically as the business and the ownership group change.
How Shah & Co Lawyers can assist
We usually work alongside your accountant and estate planning documents so every part of the plan lines up.
Buy-Sell Agreements
Drafting agreements triggered by death, disability or retirement.
Insurance Funded Arrangements
Structuring buyouts funded by insurance proceeds.
Family Succession
Advice on transitioning a family business to the next generation.
Exit Rights in Agreements
Pre emption and exit provisions in shareholders and unit holders agreements.
Estate Plan Coordination
Coordinating succession planning with wills and powers of attorney.
Plan Reviews
Reviewing and updating succession arrangements as the business changes.
What a succession plan usually addresses
- Buy sell agreements between co owners.
- Insurance funded buy out arrangements.
- Exit and pre emption rights in shareholders and unit holders agreements.
- Family business succession, including transition to the next generation.
- Coordination with wills, powers of attorney and estate plans.
Frequently asked questions
General information only. Every matter turns on its own facts.
Other commercial law services
Business Purchases and Sales
Acting for buyers and sellers in the sale of goodwill, share sales, asset sales, due diligence, transition arrangements and restraints of trade.
Learn moreCommercial Contracts
Supply agreements, services agreements, distribution agreements, agency agreements, joint ventures and confidentiality agreements.
Learn moreContract Drafting
Drafting bespoke commercial agreements that reflect how the deal actually works and protect your position if things change.
Learn moreContract Reviews
Reviewing commercial contracts before signing, flagging risk allocation issues, unfair terms and points that should be negotiated.
Learn moreCommercial Disputes
Contractual disputes, breach of contract claims, misleading and deceptive conduct claims and Australian Consumer Law matters.
Learn moreShareholder Disputes
Oppression proceedings under section 232 of the Corporations Act, deadlocks, share buy-outs and exit arrangements.
Learn moreStart planning for your business succession today.
Arrange a confidential consultation. Discreet, professional and tailored to your circumstances.