Once you have made plans to get the money needed to implement a buy/sell agreement, other issues can arise which are often fought over.
Triggering events. Many different things can trigger the buy/sell agreement but, equally important, many things can be excluded from triggering the agreement. The brawls start when there is a triggering event that is unanticipated—and there is no way to anticipate every possible triggering event. Just read your insurance policies and you’ll see what gets excluded: death, retirement, disability. A lot of buy/sell agreements have termination of employment as a triggering event. But what if one owner tries to fire the other so as to trigger the buy/sell agreement? Speaking from experience, involuntary termination of employment always leads to a brawl. Always.
Next post: another issue that can lead to a business brawl.