Determination of the Value of a Business for Purposes of a Buy-Sell Agreement

A buy-sell agreement explains how ownership interest in a business may be transferred if an owner wishes to sell, retires, divorces, passes away or becomes disabled (“trigger events”).  An effectively designed, written and funded buy-sell agreement can help avoid undue stress and financial problems at the trigger event.  However, if the buy-sell agreement isn’t supported by a business valuation prepared by an expert, it can be subject to protracted litigation.  There are several ways to determine the value of a business for purposes of the buy-sell agreement. (click here for complete article)