Financial issues can be some of the most significant factors impacting a person’s decision to divorce. After all, the effects of asset division can linger on long after emotional and relationship issues have been handled. For business owners in Hawaii, the costs can be especially significant. Entrepreneurs with small and midsized businesses may discover that their companies are their largest single marital asset. As a result, the property division process may affect the business itself and its future potential.
In many cases, one spouse is more involved than the other one in the business. A buyout agreement can settle the divorce while keeping the enterprise intact. One spouse may walk away with a greater share of real estate, retirement funds and other assets while the other individual keeps the business in his or her name alone. When a large share of family assets is bound up in the company, it can become more complicated. The business may need to take on debt to secure an agreement to buy the other spouse out. The valuation of the firm itself will also need to be credibly established, a process that can be costly and time-consuming. There may be complex issues involved in valuation, such as future planned product launches or potential investments.
Partners of the divorcing business owner may also be concerned about the future of their company. In these situations, business partners may prepare in advance by developing a buy-sell agreement that lays out specific situations and a distinct valuation for the remaining partners to buy another out of the company. This can keep the firm itself away from the divorce settlement.
Financial challenges come with every divorce, but they can be especially worrisome for entrepreneurs. A family law attorney may help business owners reach a fair settlement on issues like spousal support and property division.