Issue link: http://read.dmtmag.com/i/764739
6 6 V I N E YA R D & W I N E RY M A N A G E M E N T | J a n - F e b 2 017 w w w. v w m m e d i a . c o m B Y A I M E E K W A I N uy-sell agreements are one of the most important elements when planning for any business' long-term success. But for family-owned businesses such as wineries, they play an even more critical role in the successful transi- tion of the business from one generation to the next. WHY CREATE A BUY-SELL AGREEMENT? Buy-sell agreements con- trol the ownership of a busi- ness when a triggering event occurs. This may be an owner's death, retirement or departure from the company (although death is the most common, particularly for family business- es whose owners are unlikely to leave otherwise). This being the case, buy-sell agreements play a critical role in estate and succession planning. + Buy-sell agreements are one of the most important elements when planning for any business' long-term success. + Unless your buy-sell agreement is funded, it's unlikely to be executed successfully. + How you structure your buy-sell agreement and insurance policies should depend on your long-term goals for your business. + Even the best-laid succession plans, buy-sell arrangements and insurance policies can fail if they aren't revisited regularly. AT A GLANCE Whoever inherits a busi- ness owner's estate — be it a spouse, heir or other potential beneficiary — may also inherit t h e d e c e a s e d 's o w n e r s h i p interests. For many business- es, that's not the desired out- come. A survivor who inherits a business may have no desire to be involved; meanwhile, the remaining owners may find themselves with a new and potentially unwanted busi- ness partner. This is why giv- ing careful attention to your buy-sell agreement and related documents is an important tool for following through on your business and personal wishes. FUNDING YOUR BUY-SELL AGREEMENT It's all well and good to create a buy-sell agreement that details how ownership should change upon an own- S U C C E S S F U L S U C C E S S I O N S To transition your business to the next generation, look closely at your buy-sell agreement and life insurance.