More on Corporate Buy-Sell Agreements
As a follow-up to my previous post, The Most Important Contract, I found an interesting post by Chris Mercer from Mercer Capital titled, Your Corporate Buy-Sell Agreement: Ticking Time Bomb or Reasonable Resolution?
Chris describes some basic problems he sees with Buy-Sell Agreements:
• Never updated (10 year old agreements might be a bad idea)
• Formula pricing (Long term they can have disasterous results)
• Multiple appraisers (Bad idea)
Chris’s bottom line:
"You probably don’t spend much time at night thinking about your (or your clients’) buy-sell agreement(s). Take my word for it, you shouldn’t. You should be thinking about your buy-sell agreement now, in the light of day, and working to get a clear agreement that works for you and your fellow shareholders or partners."
What are seller’s options is buyer stops paying in a buy sell agreement?