Dealing with Business Divorce During Coronavirus
COVID-19 has left a huge mark on the United States and likely will continue to do so for many months and even years. This deadly virus has threatened the economy as well as many relationships. Families are forced to quarantine together and having to spend 24/7 with a spouse has not fared well for many marriages.
As such, many couples are sick of each other and are contemplating divorce. Whether or not you have been through a divorce before, you probably know that ending a marriage is a huge, complicated decision. This is especially true if you own a business.
Many divorces involve business ownership, so not only do couples go through a traditional divorce, but also a business divorce as well. Splitting up a company is not as easy as splitting up a pile of cash. Businesses are entities and therefore require special care.
There are many things to consider. Will you continue running the business or sell it? Will you and your spouse continue to run it together? Will he or she own shares in the company? Will you buy out the other spouse so you can continue to operate the company without interference? Here is some key advice to consider.
Don’t Rely on a Divorce Settlement Agreement
Settlement agreements are used to document various aspects of a divorce, such as property division. However, such a document may not be useful when a business is involved. If stock options were involved, a stock transfer agreement would be much more useful, particularly since the recipient spouse may need to show that document to banks, lenders, investors and other parties in the future. The spouse may not be comfortable showing a divorce agreement, since that will contain private matters unrelated to the business.
Request a Claims Release
The recipient spouse will not want to be responsible for claims against the company, such as unpaid wages, commissions and vacation time, wrongful termination and other employment matters. A release of claims will ensure that the recipient spouse will not be sued or otherwise be held responsible for these business matters.
Get a Confidentiality Agreement
Many companies use these agreements for their employees, so if your ex-spouse is now a partner in your business, you’ll want him or her to sign one of these. These agreements ensure that no trade secrets, technology and other sensitive information is disclosed to others. This document will protect your business and eliminate situations that can harm your company.
Contact a Maryland Divorce Lawyer Today
Divorces often involve numerous elements, including businesses. If you or your spouse owns a business, make sure that it is split and transferred properly in a divorce. Do not rely on a divorce settlement.
Splitting a business can be complicated. Get help from the Columbia divorce lawyers at the Law Offices of Todd K. Mohink, P.A. We can guide you through the various aspects of asset division. Schedule a free consultation by calling (410) 774-5987 or filling out the online form. We have two offices to serve you.