Buy-Sell Agreement

Term Main definition
Buy-Sell Agreement

A contract that sets forth the conditions under which a shareholder can transfer shares and usually provides that the shareholder must first offer his or her shares for sale to the other shareholders before being allowed to sell to persons or entities outside the company.

Buy-Sell Agreements are commonly used by private companies and usually terminate automatically when a company goes public because the purposes of the buy-sell agreement have been served and its usefulness ends.  Once the shares are free trading, each of the parties in theory can sell the shares into a public market. With illiquid private company stock, the buy-sell agreement could provide the liquidity, but only under specific circumstances.  Once the company is public, the markets also favor companies that are controlled by independent directors and adhere to the principle of one share, one vote.  The major purpose of the buy-sell agreement is often to provide continuity of ownership and continuity of management.  The owners of shares of public companies need to be able to freely transfer the shares, and the owners need the ability to vote their shares for their choice of directors.

Services for Everyone

  • TRADE SECRETS

    A trade secret can be any valuable information - valuable for its technological or commercial applications - if the owner takes the appropriate ongoing and consistent efforts to protect: its secrecy. The Nick Yocca Law Firm intellectual property attorneys work closely with clients to identify and protect their trade secret assets. secrecy programs. confidentiality
    Read More
  • SECURITIES

    The Nick Yocca Law Firm’s Securities Group handles all types of securities issues for businesses or individuals: advice on insider trading. legal compliance programs. working with directors and officers insurance. issues concerning securities law disclosure obligations. internal investigations. government investigations (SEC, FINRA or state). Board or shareholder disputes. M&A, takeovers,
    Read More
  • CORPORATE

    Our practice includes clients in all stages of business, from advising startup companies in search of financing, to representing clients in transactions and ongoing capitalization efforts, to serving as counsel in ongoing corporate governance, succession planning, or mergers and acquisitions. The Nick Yocca Law Firm corporate attorneys have broad experience in
    Read More
  • REAL PROPERTY

    Real Estate Transactions Our real estate practice involves all aspects of real property for companies throughout their life cycle, from start-up to public company. acquisition. financing. development. construction. disposition. leasing. limited liability companies.
    Read More
  • ESTATE PLANNING

    We do trusts and estates.  Should I try to avoid probate? Do yourself and your family a favor and engage an expert estate or elder law attorney to do a proper estate plan for you.  Why is it always a good idea to have a will and living trust?  If
    Read More
  • PRIVACY AND CYBERLAW

    We help companies with compliance issues relating to privacy, cybersecurity,e-commerce, social media, advertising practices, consumer disclosures, warranties and other consumer protection matters. Crisis management strategies: Coordinating breach notification responses and other regulatory obligations Liaising with federal government, state law enforcement and regulatory officials Assisting companies with prompt and effective media
    Read More