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Business Partner Buy Sell Agreement
"I need a Business Partner Buy-Sell Agreement for a three-partner technology consulting firm in Ontario, with specific provisions for retirement (one partner planning to retire in March 2025) and insurance-funded purchase arrangements for unexpected events."
1. Parties: Identification of all partners and the business entity involved in the agreement
2. Background: Context of the agreement, including current ownership structure and purpose of the buy-sell provisions
3. Definitions: Key terms used throughout the agreement, including triggering events, fair market value, and other critical concepts
4. Transfer Restrictions: General prohibitions on transfer of ownership interests except as permitted by the agreement
5. Triggering Events: Events that activate the buy-sell provisions (death, disability, retirement, voluntary departure, etc.)
6. Purchase Price and Valuation: Methods for determining the purchase price of ownership interests
7. Payment Terms: Structure and timing of payments for purchased interests
8. Right of First Refusal: Process for existing partners to purchase interests before third-party sales
9. Mandatory Purchase Events: Circumstances requiring mandatory purchase of ownership interests
10. Funding Mechanism: Methods for funding purchases, including insurance policies
11. Tax Considerations: Basic tax treatment and structuring of purchases
12. Representations and Warranties: Standard declarations by all parties
13. General Provisions: Standard contract clauses including governing law, amendments, notices
1. Tag-Along Rights: Used when there's potential for sale to third parties, allowing minority partners to join in the sale
2. Drag-Along Rights: Include when majority partners may need to force minority partners to join in a sale
3. Family Transfer Exceptions: Include when partners want to allow transfers to family members without triggering buy-sell provisions
4. Disability Provisions: Detailed section when partners want specific handling of disability situations
5. Non-Compete Provisions: Include when partners want to restrict post-exit competition
6. Mediation and Arbitration: Include when partners prefer alternative dispute resolution over court proceedings
7. Special Purchase Price Adjustments: Used when certain circumstances warrant adjustments to standard valuation
8. Cross-Purchase vs. Entity Purchase: Include when flexibility is needed in purchase structure
1. Schedule A - Current Ownership Schedule: Details of current ownership percentages and classes of ownership
2. Schedule B - Valuation Formula: Detailed methodology for calculating business value
3. Schedule C - Insurance Policies: List of insurance policies funding the agreement
4. Schedule D - Authorized Signatories: List of persons authorized to act under the agreement
5. Appendix 1 - Certificate of Corporate Resolution: Corporate approval of the agreement
6. Appendix 2 - Sample Valuation Report: Template for periodic valuation reports
7. Appendix 3 - Purchase Notice Forms: Standard forms for initiating purchase processes
8. Appendix 4 - Transfer Forms: Standard forms for transferring ownership interests
Authors
Professional Services
Manufacturing
Retail
Technology
Healthcare
Construction
Real Estate
Consulting
Agriculture
Financial Services
Transportation
Hospitality
Engineering
Media and Entertainment
Legal
Finance
Executive Leadership
Board of Directors
Corporate Governance
Risk Management
Corporate Strategy
Business Development
Compliance
Treasury
CEO
Managing Partner
Business Owner
Chief Financial Officer
Corporate Counsel
Managing Director
Executive Director
Board Member
Company Secretary
Finance Director
Business Development Director
Partner
Shareholder
General Counsel
Risk Manager
Corporate Controller
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