Hartford Business Lawyer Discusses a Buy-Sell Agreement
Clients sometimes come to me as a Hartford Business Lawyer with a buy-sell agreement asking me what is this agreement and should I sign it? Buy-sell agreements are a very useful governance and succession planning tool for any business owner. Basically a buy-sell agreement is an agreement that addresses unusual circumstances where it’s best if an existing member of a corporation or LLC sells its interest or shares back to the corporation or to another member. The buy-sell agreement commits the company or the other members to buy the interest of the exiting member and the exiting member to sell its interest to the company or the other shareholders in certain specific circumstances.
What are those circumstances? Divorce is one of them because there can be divisions in respect to the division of marital assets. Another one is death or incapacity. You don’t want to be dealing with a spouse or the children of your members or partners when trying to operate a business. It’s for that reason that within a death or incapacity a buy-sell agreement is often utilized to smoothly handle the success and planning of the business.
Are you planning on signing a Buy-Sell Agreement? Contact experienced Hartford Business Lawyer Eric Foster for guidance.