Stock Buy Sell Agreement Template

These agreements are often compared to marriage contracts for companies. They determine what happens to the ownership of the business when one of the owners (or individual entrepreneurs) undergoes life changes that may influence the continuation of the business itself. Life changes can range from divorce or bankruptcy to death. The buy-sell agreement protects the business and the remaining owners from the effects of an owner`s personal life that can impact the business. Each company is unique in structure. A company with multiple co-founders would have a more complicated buyout agreement. While a sole proprietorship is often easier to design and execute. This list is intended to give you a general overview of the clauses and scenarios that should be considered in most buy-sell agreements. A buy-sell contract is a contract that is created to protect a business if something happens to one of the owners. Also called a buyout, the agreement determines what happens to a company`s shares in the event of an unforeseen event. This agreement also contains restrictions on how owners can sell or transfer shares in the company. The contract is written to allow better control and management of a company. Buy-sell agreements protect your business from future problems by consolidating what happens if an owner wants or needs to sell their portion of the business.

This agreement describes who can buy an owner`s interest, what the price will be, and what will happen to an owner`s portion of the business if it dies, is disabled, retires, goes bankrupt or divorces. Another jurisdiction could decide to grant ownership to a new person in one of the above circumstances, which would give that new person the same decision-making capacity as existing partners. Any business, even a small business, could use a purchase-sale contract. They are especially important when there is more than one owner. The deal would delineate how shares are sold in any situation – whether a partner wants to retire, experience a divorce or die…

filed under: Uncategorized