A buy-sell agreement is a contract among business co-owners that sets rules for what happens to an owner’s interest if a triggering event occurs—most commonly death, disability, retirement, resignation/termination, divorce, or a desire to sell.
It typically covers:
Who can buy the departing owner’s shares/interest (the company, the other owners, or both)
How the price is determined (fixed price, formula, appraisal, etc.)
How the purchase is funded (often using life insurance for death events)
Restrictions on transfers (to keep ownership within the intended group)
