A Buy Sell Agreement between the owners of a common business can be an effective method to transfer ownership of the business upon the occurrence of certain events. Such events can include a business owner’s death, disability, divorce, retirement or voluntary transfer (or sale) of their business ownership.
Together with a client’s certified public accountant and other financial advisers, John helps his clients with determining, negotiating and memorializing the terms and conditions of a transfer, or sale, of the business ownership interests between the business owners.
Some important considerations for the preparation of a Buy Sell Agreement are:
- funding and financing of a purchase and sale under the agreement
- determining the value of the ownership interests for purchase or sale
- establishing the appropriate parties to the agreement
- determining the events which govern a mandatory, or discretionary, purchase or sale
- determining what events ‘trigger’ a purchase or sale of ownership interests
- discussion of mandatory or optional purchase or sale rights for owners
- use of professional advisers / team approach
- income tax considerations
- life insurance considerations
- coordination with business owner’s estate plan