Best Practices for Drafting Buy-Sell Agreements Among Shareholders or Members
1 hour 5 minutes
Learn about the complexities of preparing and drafting successful buy-sell agreements and how to avoid common mistakes.
Every closely held entity (corporate, LLC, or partnership) that has more than one owner should have a buy-sell agreement. This document establishes the ground rules for determining when a shareholder or member can sell their shares, when they must sell their shares, and when they can require another shareholder or member to sell their shares. Valuation issues, successorship issues, governance issues, funding issues, change-in-control issues, even confidentiality and noncompete issues can all be addressed in a single document. Learn about the opportunities and perils inherent in a document that is too often treated as a fill-in-the-blanks form, if it is considered at all, from a member of the ABA Section of Business Law’s committee drafting a model shareholder agreement.
• You will be able to define equity transfer restrictions.
• You will be able to describe options for funding buy-outs triggered by unexpected events.
• You will be able to identify and address ethical concerns that can arise in working with closely held companies.
• You will be able to discuss multiple ways for determining a company’s value over time.