Does your business need a buy/sell agreement?

Description

Abstract: It is important that businesses with more than one owner have a written buy/sell agreement specifying what happens when an owner withdraws from the business. A buy/sell agreement is a contract between the owners (or the owners and the business entity itself) that establishes rules and restrictions applicable to changes in ownership. Not only can it avoid conflicts at a fragile time, but it can also offer estate planning benefits by establishing a value for the business prior to an owner’s death. This article notes three common methods for determining the purchase price under a buy/sell agreement.