Buy-sell agreements offer hedge against unforeseen. (Entrepreneur's Notebook).DISASTER strikes, your business partner unexpectedly dies. Much to your surprise, you have just inherited a new partner: your deceased partner's spouse. Many business owners face this situation every year and some become enmeshed en·mesh also im·mesh tr.v. en·meshed, en·mesh·ing, en·mesh·es To entangle, involve, or catch in or as if in a mesh. See Synonyms at catch. in lengthy and bitter disputes. Spouses can sue for their spouse's salary in order to pay their living expenses; they can sue for an accounting of the income and expenses of each of their co-owned companies; and they can sue for the forced sale or liquidation of all their companies. These lawsuits, and the subsequent countersuits, can badly disrupt the on-going businesses, decimate dec·i·mate tr.v. dec·i·mat·ed, dec·i·mat·ing, dec·i·mates 1. To destroy or kill a large part of (a group). 2. Usage Problem a. the previously close personal relationships between the parties, and cost them hundreds of thousands of dollars in legal fees. Partnerships, corporations and limited liability corporations can be protected from these problems by creating a valid buy-sell agreement buy-sell agreement n. a contract among the owners of a business which provides terms for their purchase of a withdrawing partner's or stockholder's interest in the enterprise. among all owners. Make sure any agreement reflects the current status and value of the business, and that owners' wills and trusts obligate obligate /ob·li·gate/ (ob´li-gat) pertaining to or characterized by the ability to survive only in a particular environment or to assume only a particular role, as an obligate anaerobe. executors and trustees to implement the buy-sell agreement. A buy-sell agreement is when one co-owner buys out the other co-owner (or his or her estate) upon the occurrence of certain specified events, generally some type of voluntary or involuntary withdrawal from the business. There are two types of buy-sell agreements: a cross-purchase agreement and a redemption agreement. In a cross-purchase agreement, each remaining co-owner purchases a prorated share of the withdrawing co-owner's interest in the business. A redemption agreement differs only in that the purchaser is the company rather than the individual co-owners. Jeffrey Lewis Jeff Lewis (real estate speculator)Jeff Lewis (real estate speculator) For other uses, see Jeffrey Lewis (disambiguation).}} Jeffrey Lewis (born November 20, 1975 in New York City) is an American Anti-folk singer/songwriter and comic-book artist. is a partner with the law firm of Reish Luftman McDaniel & Reicher in West Los Angeles
Entrepreneur's Notebook is a regular column contributed by EC2, The Annenberg Incubator Project, a center for multimedia and electronic communications at the University of Southern California The U.S. News & World Report ranked USC 27th among all universities in the United States in its 2008 ranking of "America's Best Colleges", also designating it as one of the "most selective universities" for admitting 8,634 of the almost 34,000 who applied for freshman admission . Contact James Klein at (213) 743-1759 with feedback and topic suggestions. |
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