Auckland Buy and Sell Agreements Lawyer
The Importance of Hiring an Auckland Buy and Sell Agreements Lawyer for Business Owners
Safeguarding Your Business Interests
Business owners have enough problems to contend with, customers, suppliers, staff, finance, taxes, cashflow. The list goes on. All of these add stresses and strains to relationships between the owners. When they start the business, life looks like a bed of roses, but theses trains can soon put a change to that. How then do the owners protect their interests if one decides that enough is enough? Hiring an Auckland buy and sell agreements lawyer is not merely a prudent step—it is essential to the ongoing health and stability of your business.
Let’s explore why.
Understanding Buy and Sell Agreements
An Auckland buy and sell agreements lawyer has some insights.
Selling shares in a publicly traded company is easy but what about privately owned ones? That is not so easy. Who can you sell to? What about the other owners – do they get the first right of refusal? If so, which directors?
Another situation is if one director gets divorced and has to transfer their shares to the former spouse as part of the settlement?
Alternatively, if a director passes away and their shares are bequeathed to one of their relatives. How would the other owners feel about a new director that they didn’t appoint?
All of these situations and more can be addressed by having a buy and sell agreement, sometimes called business succession agreement.
These are legally binding documents which describe what happens if an owner wants to leave the business, becomes incapacitated, passes away, or if a triggering event occurs. The agreement explains how ownership can be transferred, how to value the company, and ensure that the interests of all parties are treated fairly.
Consequences of Not Hiring an Auckland Buy and Sell Agreements Lawyer
Trying to write a robust document with a DIY basis is too risky. The same goes for a template download online. Without professional legal guidance, business owners may face:
- An agreement that does not comply with New Zealand law
- It cannot be enforced in court.
- Misleading or unclear statements can result in expensive dispute resolution, between partners, shareholders, or heirs.
- Potential tax liabilities or penalties from the IRD.
- Contentious or unfair valuation methods, which can end with costly litigation.
- Loss of control if an undesired third party buys or is bequeathed shares.
- Unplanned business interruptions in the event of an owner’s sudden exit or death.
Even one poorly drafted clause can lead to years of expensive and acrimonious litigation. Remove the risk by hiring a lawyer skilled in this aspect of law.
Choosing the Right Buy and Sell Agreement Lawyer in Auckland
When selecting a buy and sell agreements lawyer in Auckland, consider:
- Experience with businesses of your size and sector.
- Clear communication and a collaborative approach.
- Proactive attitude to reviewing and maintaining your agreements as your business evolves.
Conclusion
A buy and sell agreement is more than just a legal document—it is a vital tool for ensuring the longevity, value, and integrity of your business. Failing to address these issues can lead to very expensive and acrimonious outcomes. Get your set up at an early stage while all the partners are still good friends.
To address succession planning and the transfer of ownership talk to an Auckland buy and sell agreement lawyer, like McVeagh Fleming. They have lawyers who can help you take the grief out of the future ownership of your business.