Buy-sell agreements can be set up for companies with one owner or many. The size of your company will affect your choices in setting up your specific form of buy-sell agreement and may cause one form to be more appropriate than another. Just as there are different business ownership arrangements, there are different forms of buy-sell agreements. One of the distinguishing features between the different buy-sell agreement forms is the buyer to the transaction. The buyer could be any or all of the current co-owners, an outside third party, or the business entity itself. There can also be more than one buyer.
The following table illustrates the various types of buy-sell agreements that are commonly found. Within the basic forms of agreement, you can custom-fit your buy-sell agreement to your particular business through the use of various clauses, options, and requirements.
Overview of Buy-Sell Agreement Forms
This material has been prepared solely for general informational purposes, and it does not constitute tax, legal, or accounting advice. Nor does it represent, in any manner, a solicitation, offer, or endorsement of any banking or financial product, a guarantee of any future financial outcomes, or specific investment advice. Please consult with your own tax, legal and accounting advisor before engaging in any transaction.