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Minimizing the impact of divorce on a family business

Many couples in New Hampshire have shared professional goals. In some cases, these goals include opening a family business together. As approximately 40 percent of couples married for the first time will ultimately seek a divorce and the vast majority of businesses in the United States are considered small businesses, many couples seeking to untangle their personal relationships must also manage their business relationships. Despite the complexities of doing so, there are ways to protect the family business during the end of a marriage.

In order to successfully run a business together while a marriage is ending, each person must have a clearly defined role. Both people may have had valuable roles in the company prior to the split. Fortunately, sometimes those skills can still be used in the aftermath of a split. Keeping conflict out of the workplace can also be beneficial, including declining to discuss marital problems with customers, clients and employees.

In some cases, it may also be possible to avoid one another and still keep the business running smoothly. For example, former couples could work on different days or have offices in different parts of the business. Both people also need to have firm understandings of their financial interests in the company. Because most family businesses do not have a shareholders' agreement, drawing up a simple agreement detailing how much time each person is expected to dedicate to the business and how he or she will be compensated can be helpful.

In order to divide a business, its value must be determined. Typically, one person will retain the business while the other will receive a monetary award as compensation for not retaining the business. Because a family business can complicate divorce proceedings in New Hampshire, many people ask attorneys with experience in dividing such assets to advise them and help them protect their interests.

Source: westfaironline.com, "How to keep a family business going strong in a divorce", Gus Dimopoulos, Oct. 13, 2016

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