Valuation of Buy/Sell Agreements

Sack Associates has performed many valuations required by buy/sell agreements. We have found that many of these agreements are either (i) no longer suitable for the present business and/or (ii) silent on key issues such as the standard of value to use for valuation, the terms of payment, the source of funding, etc. For example, funding requirements are very different in the case of the death of an owner where the business or remaining owners receive life insurance benefits to fund the buyout than in the case of retirement or reorganization where there are no insurance proceeds to fund the buyout.

The smoothest plan of action for buy/sell agreements is for the parties to get the stock valued every three to five years so that there is current acceptance of the methods and procedures to be employed when an event triggers the buy-sell agreement. A complete understanding of the terms of the agreement and the course of action that is to be taken can save the parties thousands of dollars that might be spent in litigation and avoid unnecessary friction between partners and/or partners’ heirs.

Sack Associates has the expertise to help you successfully navigate valuation for buy/sell agreements which can sometimes include many hidden minefields.