Buy / Sell Agreements

The prudent rule prior to starting or entering a business is to establish a formal agreement for getting out of the business relationship. Buy and sell agreements allow the business owner to transfer an interest in the business to other owners or to the business itself. The agreement can guarantee a buyer for the business and eliminate difficulties associated with transferring the business upon death or disability of one or more of the owners. Conflicts among interested parties to the business may be minimized by clearly establishing the definition of market value prior to the time of need. The value of a company changes from time to time because of the economy and the prevalent industry trends. A buy-sell agreement that is structured through a set formula of value will consistently produce an accurate determination of goodwill. Goodwill is a critical material element of the total true value of the company or business.