Buy - Sell Agreements
G3NexusConsulting provides business valuation and consulting to businesses and attorneys for buy-sell agreements (BSA’s).
Buy - Sell agreements are designed to put in place the process for how your business will be sold or transferred at a triggering event, such as death, disability, retirement or dissociation of a shareholder in a closely-held firm.
Buy-Sell Agreements - General Info
Buy-sell agreements, when written properly, clearly lay out how a business will be valued at the time of a trigger event. Sometimes a formula approach is used, other times a 3rd party business valuator is to be hired to determine value, and sometimes there is a combination of both. Think of them as an instrument to tell the "heirs" of the business how things are going to be valued and handled after a trigger event.
Some buy-sell agreements call for annual valuations to maintain a current share price and help with buy-sell funding and planning. We can complete initial valuations and annual updates, both for trend analysis as well as for benchmarking for the buy-sell agreement.
Buy-Sell Agreement Review
All buy-sell agreements should be reviewed, tested and updated periodically. Sometimes this includes testing a buy-sell price formula by performing prescribed calculations as laid out in the agreement or by providing a business valuation for comparison. Performing an independent business valuation as part of a review can help avoid surprises, delays and disputes later on.
Shareholders sometimes litigate over poorly designed, ambiguous or outdated buy-sell agreements. If this happens, we can provide expert witness and
litigation support services with our Certified Valuation Analysts (CVA). A certified appraiser is needed for all litigation cases, whether they be a triggering
event for the buy-sell agreement or a divorce situation.