A buy–sell agreement, also known as a buyout agreement, is a legally binding agreement between co-owners of a business that governs the situation if a co-owner dies or is otherwise forced to leave the business, or chooses to leave the business.
It may be thought of as a sort of premarital agreement between business partners/shareholders or is sometimes called a "business will". An insured buy–sell agreement (triggered buyout is funded with life insurance on the participating owners' lives) is often recommended by business-succession specialists and financial planners to ensure that the buy–sell arrangement is well-funded and to guarantee that there will be money when the buy–sell event is triggered.
Read more about Buy–sell Agreement: Clauses
Other articles related to "agreement":
... A buy–sell agreement consists of several legally binding clauses in a business partnership or operating agreement or a separate, freestanding agreement, and controls ... Buy-sell agreement can be in the form of a cross-purchase plan or a repurchase (entity or stock-redemption) plan ... For greater neutrality and effectiveness of the buy–sell arrangement, the service of a corporate trustee is recommended ...
Famous quotes containing the word agreement:
“Since the French Revolution Englishmen are all intermeasurable one by another, certainly a happy state of agreement to which I for one do not agree.”
—William Blake (17571827)