Buy-Sell Agreements with Paul Hood, Jr.
When the owners of a small business and the small business, itself, believe it is in their best interests to restrict each owner's right to dispose of their interests (think – financial value!) and rights (think – voting rights!) in the business, the parties (the owners, etc. and the business) formalize the agreement in a contract.
The contract is generally referred to as a "Buy-Sell Agreement".
As a business owner, do you potentially want to be in business with the other owner's spouses, guardian of minor children, mother, father, brother, aunt, uncle, friend, neighbor, etc.!
What should happen upon –
• a business owner's death, disability, or desired retirement or upon the voluntary sale (ie: outright sale!) or involuntary sale (ie: bankruptcy, etc.!)
• or disposition (ie: transfer to spouse, children, mother, father, brother, aunt, uncle, friend, neighbor, etc.!).
The beauty is that the business owners agree on the right provisions in a formalized contract when everyone is levelheaded and getting along! Can you imagine the alternatives! Think of even the business itself and what could cause a terrible disruption/downward spiral!
Here's the full episode!
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