Business GEM # 9 In All Partneship Agreements
In all partnersip agreements, include a cross-purchase buy sell agreement that can be triggered by either party upon disagreement between the partners. Here is the sample wording: to be included in a Cross-Purchase Buy-Sell Agreement
Offer to Purchase: Either Party may by written notice, at any time after ________________ (Date) offer to purchase the other Party’s ownership interest in ________________ (Name of entity). Said written notice shall specify the price and payment terms for the proposed purchase.
Recipient’s (Offeree’s) Alternatives. Upon receipt of notice offering to purchase as described above, and unless otherwise agreed, the Party receiving the notice (the “Offeree”) shall, within ______ calendar days thereafter, elect one of the following two alternatives:
Acceptance. The Offeree may accept the purchase offer and sell the Offeree’s ownership interest upon the terms and for the price set forth in the offer to purchase; or
Exercise of Election to Purchase. The Offeree may give written notice to the offering Party that the Offeree elects to purchase the other Party’s ownership interest, for the price and under the same payment terms as contained in the offer to purchase.