Successful businesses are the result of lots of hard work and dedication to a common goal. Part of keeping a business growing and successful is having a succession plan in place. A well-thought out plan of succession of ownership and control over a business is a way of protecting all you have worked to build. A professionally drafted buy/sell agreement is the best way to ensure transfer of ownership is handled as the owner or owners wish. The business attorneys at Shapiro Law Group, PC, in Massachusetts can help create and negotiate buy/sell agreements that protect owners and the businesses in which they invest so much time and energy.
Any type of business entity, such as a corporation, LLC or LLP, should have a buy/sell agreement in place in order to secure the continuation of the business. The documents are typically utilized in the event of death, divorce, bankruptcy, or incapacitation of one owner or partner. Wanting to step away from a business or other circumstances also call for the use of a buy/sell agreement.
There are two common types of buy/sell agreements drafted by Massachusetts business owners—redemption agreements and cross-purchase agreements.
A redemption agreement is used by businesses with three or more owners. When one owner leaves, that owner’s shares or percentage of ownership is purchased by the company or entity. It is not absorbed or purchased by another owner individually.
A cross-purchase agreement is essentially an agreement for one partner to buy out another. The operation of the business then continues without interruption. When one owner dies and the other owner buys out their part of the business, the proceeds typically go to the family.
The details of any buy/sell agreement may go beyond the monetary impact of transferring ownership. It can also include stipulations related to life insurance policies and the purchase of shares in the company.
Whenever there is more than one owner of any size business, having a solid and clearly defined buy/sell agreement in place is an essential business tool. It not only protects the owners in the event of one leaving the business, it protects the actual business and other employees.
Experienced Buy/Sell Agreements Attorneys
Shapiro Law Group, PC, has the business law experience and knowledge needed to draft and revise a comprehensive buy/sell agreement that works in the best interests of everyone impacted by that business. We have the resources and dedicated needed to ensure every detail is handled and every necessary provision is made. Let us help you secure all you have worked to build. Shapiro Law Group, PC, can give you peace of mind as to what will become of your business when any changes in ownership occur. Let us help draft a comprehensive buy/sell agreement and assist in any other business legal services you may need.
The attorneys at Shapiro Law Group, PC, are ready to help you. Contact us today to set up your free initial consultation. 339-200-9933.