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Lotzar Law Firm P.C.

Legal talent that pays for itself.
480.905.0300 x103 8687 E. Via de Ventura, Suite 115 Scottsdale, Arizona 85258

Do I Always Have to Consider the 4 D’s in Business Planning?

August 5, 2014 by Charles Lotzar

When starting a business or starting a professional organization, it is essential to plan for the future. This means determining what will happen if any business owners need to leave the company at any point in time. This also means protecting your own ownership interests and ensuring that the organization can survive and be left behind as a lasting legacy.

business paperwork

To ensure that you have a plan in place to protect your interests in your organization, there are 4 D’s in business planning that should be considered whenever you start a new company.  An experienced Scottsdale Arizona business lawyer at Lotzar Law Firm, P.C. can help you to understand the 4 D’s in business planning and advise you on how to take the right steps to be prepared for any future developments that could threaten the value or operations of your organization.

The 4 D’s in Business Planning

 

The 4 D’s in Business Planning stand for:

  • Divorce
  • Disability
  • Death
  • Discharge from employment

The 4 D’s need to be considered in the creation of any business plan or when any organization first begins operations. Whether you are the sole owner of your organization or you are entering into a partnership or other shared-ownership arrangement, planning for these potential future events can ensure that your organization can continue to operate and that you can maintain the value of your business no matter what happens down the line.

Planning for the 4 D’s is essential because otherwise there could be a costly and expensive future disagreement that must be resolved in court. If you do not plan in advance, operations of your organization could be interrupted by a future dispute and your business could lose value, or an interest in your business could end up being owned by someone who you cannot effectively work with.

In a divorce or a death, for example, the spouse of a business owner could be awarded a share in the business or the business could be sold or transferred to a family member that the other business owners do not wish to work with.

An Agreement put in place before any of the 4 D’s happen will allow for business owners to avoid undesirable transfers of the organization or other shifts in ownership or operations that could adversely impact operations.

When considering the 4 D’s in business planning, a variety of tools can be utilized to protect the organization. A detailed Buy-Sell Agreement is common and an attorney can assist with drafting an effective and enforceable contract. Business owners frequently purchase life insurance to make it possible for partners to buy them out in the event of a death.  Incorporating an organization can also make it possible for the organization to survive beyond the lives of individual owners, as well as providing protecting for the owners from personal liability.

Lotzar Law Firm, P.C. has extensive experience representing clients and helping them to consider the 4 D’s in business planning.  Call or contact our experienced Scottsdale Arizona business law attorneys online today to get started protecting the future of your organization.

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Charles Lotzar
Charles Lotzar
With more than 25 years of legal experience, Chuck Lotzar knows how to solve problems and make deals happen. He earned his Bachelor of Arts in Business from Michigan State University in 1982, and his Juris Doctorate from the University of Detroit School of Law in 1985. Mr. Lotzar has extensive experience dealing with public contracts and issues related to public officials and has been involved in bond financings with an aggregate value in excess of $5 billion.
Charles Lotzar
Latest posts by Charles Lotzar (see all)
  • How Often Do I Have to Re-Certify a Tax Credit Tenant’s Household Income? - November 12, 2015
  • Property Tax Abatement vs. Property Tax Exemptions – GPLET - November 12, 2015
  • Can You Restructure Your Business Under the Arizona Entity Restructuring Act? - November 5, 2015

About Charles Lotzar

With more than 25 years of legal experience, Chuck Lotzar knows how to solve problems and make deals happen. He earned his Bachelor of Arts in Business from Michigan State University in 1982, and his Juris Doctorate from the University of Detroit School of Law in 1985. Mr. Lotzar has extensive experience dealing with public contracts and issues related to public officials and has been involved in bond financings with an aggregate value in excess of $5 billion.

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