Credit that will provide for your basic interests
In the case of the death or critical illness of retiring owners before the planned retirement date, the agreement could either contemplate an immediate transfer of the remaining equity to the acquiring owners and immediate payment to the retiring owners or their estates (particularly if it had been possible to adequately insure the retiring owner [...]
The initial credit score examination procedure
Sale of your interests. This involves the sale of your interests to the acquiring owner. The sale of your interests can be in stages, or all on your exit. Usually, it is accomplished in two stages as follows: The initial purchase. There can either be no initial purchase (either because both businesses have the same [...]
Turn your attention to vital debt issues
The co-owners in the merged entity will, in most cases, not know each other particularly well and there will be concerns about whether they will be compatible. Because of this it might be wise to include some form of trial period in the agreement, while it is certainly prudent to include provisions that facilitate an [...]
The formula for a credit optimalization
Matters of particular interest in shareholders’ agreements for sole trader mergers are the following: a) For retiring owners, the agreement to purchase their interests on retirement is the culmination of their exit plan. b) The question of how to treat the potential growth in value of the business while it is a merged entity managed [...]
Credit lessons to be learned
Your original plan to exit through a family succession would probably have had two main objectives, namely: Financial objectives You planned to sell the business to your son for an agreed price and, perhaps, accepted that payment would be made over time. Because you controlled the transaction, the price and payment terms could be tailored [...]
How much time with your credit you have left?
As you have seen, the reason for your exit (whether planned or otherwise) could have a direct influence on when the exit will take place. When the exit takes place will, obviously, influence the time you have to plan and, perhaps the method of exit employed. These factors could have a profound impact on the [...]
Actual reasons of debt problems
It is interesting to note that there are many other reasons (besides the anticipated reasons given above) why owners actually decide to exit their businesses. These include personal and business reasons. a) The owner’s personal reasons could be: a fall out with partners or shareholders (including family shareholders); family reasons, such as a divorce; ill [...]
Expected reasons for credit problems
When examining the reasons for exiting a business, we must distinguish between what business owners think will cause them to exit their businesses from the reasons why an exit actually happens. When asked what will cause them to exit, the usual reason given by business owners is reaching ‘normal’ retirement age (which for most owners [...]
How are credit investors attracted
Your exit from a business can be accomplished in stages. It might be part of a company strategy to sell shares to investors as stage one and later, as stage two, to sell all the shares in a secondary buy-out, or to list the company on the Stock Exchange. If your potential investors are professional [...]
Obtaining maximum credit flexibility
It is paramount that the business owner retains maximum exit planning flexibility, including the ability to sell 100% of the business when he so wishes. Where your company has granted an option to an employee that is still current, this option could still subsist when you sell your company. Consequently, any potential purchasers will know [...]