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.
Oregon Checklist — Buy/Sell Agreement— - Contingencies: A Detailed Description and Types When engaging in a real estate transaction in Oregon, specifically involving buy/sell agreements, it is crucial to have a thorough understanding of the key aspects and contingencies related to the process. This checklist helps potential buyers and sellers navigate the intricacies of Oregon real estate law, ensuring a smooth and legally sound transaction. Keywords: Oregon, buy/sell agreements, contingencies, real estate transaction, checklist. 1. Earnest Money Agreement — This type of contingency refers to the clause in a buy/sell agreement that outlines the amount of earnest money (a deposit made by the buyer to show their commitment) and the related terms. This provision helps protect both parties from any potential breach of contract. 2. Financing Contingency — This contingency essentially means that the buyer's obligation to purchase the property is contingent upon obtaining satisfactory financing. It sets a specific period to secure a loan and allows the buyer to withdraw from the agreement if financing is not obtained. 3. Inspection Contingency — The inspection contingency ensures the buyer has the opportunity to hire professionals to thoroughly examine the property's condition before completing the transaction. This clause states the timeframe, inspections allowed, and the buyer's right to negotiate repairs or request credits based on the inspection results. 4. Title and Insurance Contingency — This contingency ensures that the seller must provide clear title to the property, usually through a preliminary title report. It also safeguards the buyer's ability to obtain title insurance, protecting against any potential title issues that may arise. 5. Appraisal Contingency — This type of contingency allows the buyer to request a professional appraisal of the property. If the appraised value is lower than the agreed-upon purchase price, the buyer may negotiate a reduction or termination of the agreement. 6. Home Sale Contingency — In situations where the buyer needs to sell their current property to finance the purchase, a home sale contingency allows them a specific time frame to sell their existing home. This clause protects the buyer from being responsible for two mortgages simultaneously. 7. HOA Contingency — Some properties in Oregon may be subject to homeowners' association (HOA) rules and regulations. This contingency allows the buyer to review and approve the HOA documents, including fees, bylaws, and any special assessments. 8. Rental Contingency — If the property being sold is currently rented, this contingency protects the buyer in ensuring they will receive a vacant property upon closing. It specifies the necessary notice period for the tenant to vacate and outlines potential consequences for non-compliance. These are some key contingencies found within the Oregon Checklist — Buy/Sell Agreements. However, it's important to understand that each transaction may present unique circumstances, requiring additional or modified contingencies to protect the buyer and seller. To ensure a successful real estate transaction in Oregon, it is advisable to consult with a knowledgeable real estate attorney or agent well-versed in Oregon real estate law.Oregon Checklist — Buy/Sell Agreement— - Contingencies: A Detailed Description and Types When engaging in a real estate transaction in Oregon, specifically involving buy/sell agreements, it is crucial to have a thorough understanding of the key aspects and contingencies related to the process. This checklist helps potential buyers and sellers navigate the intricacies of Oregon real estate law, ensuring a smooth and legally sound transaction. Keywords: Oregon, buy/sell agreements, contingencies, real estate transaction, checklist. 1. Earnest Money Agreement — This type of contingency refers to the clause in a buy/sell agreement that outlines the amount of earnest money (a deposit made by the buyer to show their commitment) and the related terms. This provision helps protect both parties from any potential breach of contract. 2. Financing Contingency — This contingency essentially means that the buyer's obligation to purchase the property is contingent upon obtaining satisfactory financing. It sets a specific period to secure a loan and allows the buyer to withdraw from the agreement if financing is not obtained. 3. Inspection Contingency — The inspection contingency ensures the buyer has the opportunity to hire professionals to thoroughly examine the property's condition before completing the transaction. This clause states the timeframe, inspections allowed, and the buyer's right to negotiate repairs or request credits based on the inspection results. 4. Title and Insurance Contingency — This contingency ensures that the seller must provide clear title to the property, usually through a preliminary title report. It also safeguards the buyer's ability to obtain title insurance, protecting against any potential title issues that may arise. 5. Appraisal Contingency — This type of contingency allows the buyer to request a professional appraisal of the property. If the appraised value is lower than the agreed-upon purchase price, the buyer may negotiate a reduction or termination of the agreement. 6. Home Sale Contingency — In situations where the buyer needs to sell their current property to finance the purchase, a home sale contingency allows them a specific time frame to sell their existing home. This clause protects the buyer from being responsible for two mortgages simultaneously. 7. HOA Contingency — Some properties in Oregon may be subject to homeowners' association (HOA) rules and regulations. This contingency allows the buyer to review and approve the HOA documents, including fees, bylaws, and any special assessments. 8. Rental Contingency — If the property being sold is currently rented, this contingency protects the buyer in ensuring they will receive a vacant property upon closing. It specifies the necessary notice period for the tenant to vacate and outlines potential consequences for non-compliance. These are some key contingencies found within the Oregon Checklist — Buy/Sell Agreements. However, it's important to understand that each transaction may present unique circumstances, requiring additional or modified contingencies to protect the buyer and seller. To ensure a successful real estate transaction in Oregon, it is advisable to consult with a knowledgeable real estate attorney or agent well-versed in Oregon real estate law.
