A buy - sell agreement is useful in assuring the orderly transfer of interests in the partnership or corporation. By limiting a party's ability to dispose of his or her interest in the partnership or corporation, control of the partnership or corporation may be assured.
A Shareholders' Buy-Sell Agreement between Attorney Shareholders and Professional Corporation is a contract between two or more shareholders of a professional corporation that outlines a process for the sale of a shareholder's interest in the corporation. It typically sets out the terms and conditions of sale, including the purchase price, payment terms, and any restrictions on the sale. It also often sets out what will happen in the event of a shareholder's death, disability, or retirement. There are two main types of Shareholders' Buy-Sell Agreement between Attorney Shareholders and Professional Corporation. The first is a Cross-Purchase Agreement, where each shareholder agrees to purchase the shares of the other shareholders on the death, disability, or retirement of the shareholders. The second is a Redemption Agreement, where the corporation agrees to buy out the shares of the deceased, disabled, or retired shareholder. Both types of agreements are intended to protect the remaining shareholders by ensuring that the deceased, disabled, or retired shareholder’s interest is bought out at a fair price and in a timely manner. The agreements also provide a mechanism for the corporation to continue to operate without interruption in the event of a shareholder’s death, disability, or retirement.
