What is a buy-sell agreement?

A buy-sell agreement, also known as a buyout agreement, is a legally-binding contract between business partners in the District of Columbia. This agreement states what will happen if one of the partners dies, becomes disabled, or wishes to leave the business. The remaining partners can use the buy-sell agreement to buy out the departing partner’s share of the business. The buy-sell agreement outlines the terms of ownership, such as how the departing partner’s share of the business will be determined, which partner has the right to buy the others out, and how the funds will be paid. It also states who will have the rights and responsibilities regarding the business’s operations and the length of time the departing partner’s shares will remain valid after they leave the business. The buy-sell agreement is an important part of business formation law in the District of Columbia, as it helps to protect the business and its partners. By outlining the rules of ownership and what will happen in the event of a partner leaving, it can help to prevent disputes and ensure a smooth transition. This agreement is essential for business partners to consider when forming a business in the District of Columbia.

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What is a buy-sell agreement?

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