Make sure your buy-sell agreement works when it is needed
Most multi-owner companies have a buy-sell agreement. Many were signed years ago and never updated. This buy-sell agreement review kit shows whether your agreement’s price still reflects what the company is worth, how much insurance each owner needs, and whether a buyout paid over time is affordable.
Thank you for reading this post, don’t forget to subscribe!Who it’s for
Owners of businesses with two to five owners, and the advisors who help them review their agreements.
What the buy-sell agreement review kit helps you do
- Compare your agreement’s price to a current value and see the gap for each owner
- Calculate the insurance needed under entity redemption and cross-purchase structures
- Find the funding gap for every owner
- Model an installment buyout and test it against company cash flow
- Review your agreement with a 10-point checklist
What’s included
- Buy-Sell Agreement Review Guide (PDF)
- Buy-Sell Funding Workbook with Owners, Price Check, Insurance Funding, and Installment Buyout tabs (Excel)
How it works
First, list each owner and the insurance in force. Next, enter how your agreement sets the price and compare it to a current value. Then, review the insurance gap and the installment buyout cost. Finally, work through the checklist with your attorney, CPA, and insurance advisor.
Why a review matters now
A 2024 Supreme Court decision, Connelly v. United States, changed how company-owned life insurance used to fund a buyout can affect estate tax value. If your agreement uses entity redemption, it is worth a fresh look. Planning a sale instead? See our Exit Readiness Kit.
Buy-sell agreement FAQ
How often should we update our buy-sell price? Most agreements call for an annual update. If yours uses a fixed price that has not changed in two years or more, it is likely out of date.
Does this replace our attorney? No. The kit helps you find the issues and the numbers. Your attorney updates the agreement.
Need a current valuation for your buy-sell agreement? Work with us at LNS Accounting & Business Consultants.
Format: PDF and Excel. Instant download. General information only; not a business valuation. Not tax or legal advice.