By Brad MacLiver
Authorship and profile at Google
Buy-Sell Agreements for Pharmacy Owners inGeorgia
When a GA pharmacy is owned by two or more people the stockholders/partners should have a Buy-Sell Agreement. A buy-sell agreement is a written document that provides the procedures and governs the future sale of theGeorgia
Pharmacy buy-sell Agreements protect the interest of the parties who own the pharmacy inGeorgia Georgia
Buy-sell agreements are important because the different elements of a future sell are predetermined and won’t need to be negotiated during a heated dispute, or during a grieving period. It provides both the stockholder and the family a comfort level that when the inevitable time comes for an exit strategy that the process was thoroughly thought out in advance.
There are disadvantages to not having a buy-sell agreement between pharmacy owners. A disability can leave one partner working while another does nothing to add to the productivity. Also, in the case of a death, one partner may be left with a nonproductive heir if there is no agreement, or a new partner with personality conflicts with the surviving partner may be inserted. The wrong partner could be a devastating situation for theGeorgia
Various types of buy-sell agreements exist, such as the Entity Buy-Sell Agreement, Cross-Purchase Buy-Sell Agreement, Wait and See Buy-Sell Agreement, and Disability Buy-Sell Agreement. Buy-sell agreements are also called a Buyout Agreement or Business Will.
Potential elements of a Buy-Sell Agreement in GA:
1. The names, voting rights, and number of shares belonging to stockholders.
2. Guidance for the certified pharmacy valuation and purchase of a stockholder’s shares.
3. Mutual covenants and considerations.
4. Restrictions on the transferring, purchasing, or encumbering stock belonging to the company.
5. Necessary protocol in the event of a shareholder’s divorce/termination of a shareholder's employment.
6. Any obligations to buy or sell shares from an estate.
7. Purchase of insurance to ensure ability to meet obligations.
8. Purchase of stock paid in lump sum or by installments.
9. Remedies for breach of the agreement or default of payment.
10. Until transfer is complete the right to inspect books and records.
11. Amendments and notices for offers or legal matters.
12. Enforceability of the agreement, the binding effects, and arbitration procedures for disputes.
13. Process for dissolution, or liquidation, of the corporation.
14. Maintaining the premises during a transition.
15. Preserving representations and warranties.
16. The terms of transfer.
17. Bill of Sale.
To ensure that the money required is available, buy-sell agreements are often funded with a life insurance policy. Should the death of one of pharmacy owners occur, the life insurance settlement will provide the funds for the remaining pharmacy owner inGeorgia
Life insurance coverage for each partner needs to be in place, because without a way to accomplish the purchase of the pharmacy shares the buy-sell agreement will not be functional. As the business grows and develops the amount of insurance need to be adjusted to provide an adequate coverage. Without the insurance the surviving stockholder may not have enough cash to satisfy the amount required to buy out the estate - leaving the survivor with an unwanted partner.
To have the adequate insurance coverage and to determine the specifics of the buy-out terms, a certified GA pharmacy business valuation is needed. There are a large number of companies that provide business valuations. Due to the dynamics and current market conditions of the pharmacy industry a valuation firm should have extensive pharmacy experience. Simple accounting formulas and multipliers will not provide an adequate, or realistic, valuation for a pharmacy business inGeorgia
Pharmacy buy-sell agreements are extremely important documents that need to be completed with seriousness and care. Even with a long standing partnership, it is only too late to create a buy-sell agreement when an event has already occurred....that would require the document.
Tips for Georgia Pharmacy Owners:
1. Buy-Sell Agreements are critical documents that should not be taken lightly. Consult a licensed professional.
2. Documents must address the proper laws and regulations which vary from state to state. Seek the proper guidance.
3. Premiums for insurance that will fund the buy-sell agreement might be deductible.
4. Ensure that the pharmacy valuation is performed by an establishedGeorgia
Authorship and profile at Google
Buy-Sell Agreements for Pharmacy Owners in
When a GA pharmacy is owned by two or more people the stockholders/partners should have a Buy-Sell Agreement. A buy-sell agreement is a written document that provides the procedures and governs the future sale of the
Pharmacy buy-sell Agreements protect the interest of the parties who own the pharmacy in
Buy-sell agreements are important because the different elements of a future sell are predetermined and won’t need to be negotiated during a heated dispute, or during a grieving period. It provides both the stockholder and the family a comfort level that when the inevitable time comes for an exit strategy that the process was thoroughly thought out in advance.
There are disadvantages to not having a buy-sell agreement between pharmacy owners. A disability can leave one partner working while another does nothing to add to the productivity. Also, in the case of a death, one partner may be left with a nonproductive heir if there is no agreement, or a new partner with personality conflicts with the surviving partner may be inserted. The wrong partner could be a devastating situation for the
Various types of buy-sell agreements exist, such as the Entity Buy-Sell Agreement, Cross-Purchase Buy-Sell Agreement, Wait and See Buy-Sell Agreement, and Disability Buy-Sell Agreement. Buy-sell agreements are also called a Buyout Agreement or Business Will.
Potential elements of a Buy-Sell Agreement in GA:
1. The names, voting rights, and number of shares belonging to stockholders.
2. Guidance for the certified pharmacy valuation and purchase of a stockholder’s shares.
3. Mutual covenants and considerations.
4. Restrictions on the transferring, purchasing, or encumbering stock belonging to the company.
5. Necessary protocol in the event of a shareholder’s divorce/termination of a shareholder's employment.
6. Any obligations to buy or sell shares from an estate.
7. Purchase of insurance to ensure ability to meet obligations.
8. Purchase of stock paid in lump sum or by installments.
9. Remedies for breach of the agreement or default of payment.
10. Until transfer is complete the right to inspect books and records.
11. Amendments and notices for offers or legal matters.
12. Enforceability of the agreement, the binding effects, and arbitration procedures for disputes.
13. Process for dissolution, or liquidation, of the corporation.
14. Maintaining the premises during a transition.
15. Preserving representations and warranties.
16. The terms of transfer.
17. Bill of Sale.
To ensure that the money required is available, buy-sell agreements are often funded with a life insurance policy. Should the death of one of pharmacy owners occur, the life insurance settlement will provide the funds for the remaining pharmacy owner in
Life insurance coverage for each partner needs to be in place, because without a way to accomplish the purchase of the pharmacy shares the buy-sell agreement will not be functional. As the business grows and develops the amount of insurance need to be adjusted to provide an adequate coverage. Without the insurance the surviving stockholder may not have enough cash to satisfy the amount required to buy out the estate - leaving the survivor with an unwanted partner.
To have the adequate insurance coverage and to determine the specifics of the buy-out terms, a certified GA pharmacy business valuation is needed. There are a large number of companies that provide business valuations. Due to the dynamics and current market conditions of the pharmacy industry a valuation firm should have extensive pharmacy experience. Simple accounting formulas and multipliers will not provide an adequate, or realistic, valuation for a pharmacy business in
Pharmacy buy-sell agreements are extremely important documents that need to be completed with seriousness and care. Even with a long standing partnership, it is only too late to create a buy-sell agreement when an event has already occurred....that would require the document.
Tips for Georgia Pharmacy Owners:
1. Buy-Sell Agreements are critical documents that should not be taken lightly. Consult a licensed professional.
2. Documents must address the proper laws and regulations which vary from state to state. Seek the proper guidance.
3. Premiums for insurance that will fund the buy-sell agreement might be deductible.
4. Ensure that the pharmacy valuation is performed by an established
