A buy-sell agreement is an agreement between the owners of the business for purchase of each others interest in the business. Such an agreement will spell out the terms governing sale of company stock to an outsider and thus protect control of the company. It can be triggered in the event of the owner's death, disability, retirement, withdrawal from the business or other events. Life insurance owned by the corporation is often used to provide the funds to purchase the shares of a closely held company if one of the owners dies.
The time to prevent disputes is before they occur. Experience proves that owners anxieties created in dealing with one another are inversely proportional to the effort they spend addressing business problems in the event that they should happen. Dealing with these contingencies before they manifest themselves is the secret to a harmonious business relationship with other owners, Use the checklist below to determine areas where you may need assistance.
Hawaii Checklist — Buy/Sell Agreement— - Contingencies When engaging in a buy/sell agreement for real estate transactions in Hawaii, it is crucial to have a comprehensive checklist to ensure a smooth and successful process. This checklist helps buyers and sellers understand and fulfill their obligations and contingencies. Below, we have compiled a detailed description of what a Hawaii Checklist — Buy/Sell Agreement— - Contingencies typically includes, as well as a mention of different types and variations available. 1. Financial Contingencies: This category includes critical aspects related to finances, such as mortgage pre-approval, loan commitment, or proof of funds for cash buyers. Buyers need to secure proper financing, while sellers must verify the financial capability of potential buyers. 2. Inspection Contingencies: This section outlines the necessary inspections to be conducted before proceeding with the transaction. It may include general inspections, termite inspections, radon tests, mold assessments, or any other inspections relevant to the property's condition in Hawaii. 3. Appraisal Contingencies: Real estate appraisal contingencies are essential to ensure that the property's value aligns with the purchase price. This section typically involves hiring a licensed appraiser to assess the property's fair market value. 4. Title Contingencies: Title contingencies protect the buyer's interest in the property. It involves obtaining a preliminary title report, reviewing it for any outstanding liens, judgments, or encumbrances, and ensuring that the seller has a marketable title. 5. Homeowners Association (HOA) Contingencies: For properties located within an HOA, buyers are often required to review and approve the HOA documents and regulations before completing the purchase. This section covers HOA fees, covenants, conditions, and restrictions (CC&Rs), and any specific requirements unique to Hawaii. 6. Contingencies Related to Permits and Zoning: As regulations may vary depending on the location, this section emphasizes securing the necessary permits or ensuring the property is used for its intended purpose according to local zoning laws. 7. Seller Disclosures: In Hawaii, sellers are required to provide specific disclosures, such as lead-based paint, known defects, or any material information that may affect the value or desirability of the property. Types of Hawaii Checklist — Buy/Sell Agreement— - Contingencies: a. Residential Property Buy/Sell Agreements: This type of checklist is applicable to standard residential properties, including houses, condos, townhouses, and other dwellings. b. Commercial Property Buy/Sell Agreements: When dealing with commercial properties, the checklist may have additional contingencies specific to commercial real estate, such as tenant leases, environmental assessments, or regulatory compliance. c. Land Purchase Buy/Sell Agreements: For individuals buying or selling land parcels in Hawaii, this type of checklist addresses unique contingencies related to zoning, land use, infrastructure access, and development potential. d. Vacation Rental Buy/Sell Agreements: Hawaii's thriving vacation rental market often requires a checklist tailored to specific contingencies related to licensing, transient accommodation regulations, and income disclosures. In summary, a Hawaii Checklist — Buy/Sell Agreement— - Contingencies covers various vital components such as financial considerations, inspections, appraisals, title verification, HOA requirements, permits and zoning, seller disclosures, and more. Depending on the type of property being bought or sold, the checklist may have specific variations focusing on residential, commercial, land, or vacation rental transactions.
