Buy-Sell Agreements: Valuation Handbook for Attorneys
is a one-of-a-kind resource for attorneys representing business owners.
Well-prepared buy-sell agreements establish a valuation process to set the price at which a transaction will occur when trigger events happen. Many, if not most, buy-sell agreements in existence today have dated language pertaining to the description of their appraisal processes and the definitions of the price to be set by these processes.
The book, penned by an experienced business appraiser and veteran of many buy-sell agreement disputes, scrutinizes common issues in current agreements and suggests improvements.
The book also provides seven elements that should be clearly defined in every agreement, including:
Standard of value (like fair market value)
Level of value (like financial control)
Going concern requirement
“As-of” date
Qualifications of appraisers
Appraisal standards to be followed
Consideration of life insurance proceeds
The importance of this last element has been heightened by the U.S. Supreme Court decision in Connelly, which affects buy-sell agreements involving life insurance, as discussed in the book’s appendix.
Importantly, the book provides example language for consideration by attorneys when drafting buy-sell agreements that contains language important to the valuation process.
Attorneys will find that
will be an invaluable resource for reviewing existing agreements or drafting new ones.