When two or more partners start a business, they have many decisions to make regarding the future direction of their company. One thing they may not want to overlook is the possibility that one of the partners may go through a divorce in the future. This personal choice can have a significant impact on a jointly-held Oregon small business, and there are certain types of contracts that can protect against this possibility.
Marital property is subject to division in a divorce, which includes everything accumulated, bought or saved over the course of a marriage. It is possible this may include business profits or even a share of the value of a company. A partner’s soon-to-be-ex-spouse could eventually have controlling stake in a company or a rightful claim to some of the company’s profit. In some cases, it may be necessary to buy out that one partner’s share of the business, if possible.
It is beneficial for partners to have an enforceable partnership agreement. They can include terms for how the company will operate and more, but they may need to also include terms for how it will work if partners want to buy one person’s share in the company. These agreements can make it much easier in the event an unexpected divorce.
One of the main goals of partnership agreements and other types of contracts is that they provide legal protection for an Oregon business. Divorce is complicated, and it is not worth risking a small business because of a property division dispute. A company may want to speak with an attorney regarding the specific steps they need to take for full protection.