R. Shawn McBride recently spoke about updating your Buy/Sell agreement. Here is the transcript: https://www.facebook.com/rshawnmcbridepublic/videos/1493498577348710/
Hey folks, R. Shawn McBride with you here live, and I’m gonna talk about an important issue we’re seeing today, which is, it’s probably time to update your Buy/Sell agreement. So many times when people come to me with an issue, they have not updated their Buy/Sell. They haven’t done the work to go back and revisit it – so, the Buy/Sell you put in when you started your company . . . usually there’s two major issues.
Number one, it was done quickly in haste, because you were just trying to get the company up and running. You were trying to get out of the box, get proof of concept, build your customer base, and you didn’t stop to really work through the Buy/Sell.
The second issue is the passage of time, businesses change, the partnership has changed, people have evolved, you’ve understood more about what your business looks like, maybe your business model has changed.
So, for either of these reasons, your Buy/Sell that you’re sitting on today, in many cases, probably is out of date. I see it all the time when partnership disputes come up – people come to me, we go back to their Buy/Sell, they don’t understand what it says. They don’t understand how it works, or it just doesn’t fit the current situation, the assets aren’t valued correctly, it just doesn’t work. So we’re going to need to dissect it and update it, so, if you’re a business owner, if you’re resting assured, saying, I’ve got a Buy/Sell, I don’t have to worry about a partnership issue because I’ve already done the hard work, time to stop and revisit things. Do you really have a great agreement in place? Are you really ready to move forward? So, we want to look at that. Very easy to do, pull the thing out of the drawer, look at your LLC agreement, your partnership documents, your corporate documents, whatever the case might be, as a totality, and see how the pieces are fitting together. Does it make sense?
This is great, and one advantage you have, as a business owner, when you’re looking at your Buy/Sell, is you are generally not a lawyer, so you don’t have that clouded eyes, you can read that Buy/Sell, and if it makes sense to you, then your Buy/Sell is probably a good Buy/Sell. If you read the Buy/Sell and you don’t understand what it says, guess what? Jury’s probably not gonna understand it, and a judge may not understand it, so you want to get it updated.
And you want to read it and make sure it makes sense, does the Buy/Sell you have now make sense in light of where your business is? A lot of issues possibly there.
Now, this week I’m gonna do a series, we’re gonna visit again and again about Buy/Sells, and we’re gonna look at different pieces of them, so stay tuned. Tune to my page, make sure you like this page if you haven’t, so you get the updates, look in every day, I’ll be posting updates and ideas on things you can do to update your Buy/Sells, so let’s get this done, let’s help our businesses, let’s build ’em for the future, let’s make sure we have a solid foundation with a good Buy/Sell because, if you’re doing all this work to build the business and something goes wrong, you’ve got a problem. R. Shawn McBride, see you again soon, look for my series this coming week, talk to you soon.
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This posting is intended to be a tool to familiarize readers with some of the issues discussed herein. This is not meant to be a comprehensive discussion and additional details should be discussed with your attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances. Each case is unique. Past results do not guarantee future outcomes. This article should not be treated as legal advice to any person or entity. Freeimages.com/photographer Odan Jaeger.
About the Author
R. Shawn McBride is the Chief Innovation Officer at McBride For Business, LLC. His signature keynote, The 3 Laws of Empowerment (www.rshawnmcbridelive.com/3laws), gives audiences an entertaining look at how they can prepare, plan and protect themselves. You can reach R. Shawn McBride at firstname.lastname@example.org or (214) 418-0258.
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