When you are practicing in the field of dentistry, it is imperative that a buy-and-sell agreement should be put in place, especially when working together with another dentist. This agreement will make it possible to immediately sell one's share of the business when one dies, retires, leaves, or becomes disabled. Before you sign the agreement, here are questions to ask dental brokers Columbus Ohio.
First, better ask if this purchase is optional or if this will become required during a triggering event. For death and disability, you will most possibly want the purchase to be required during a triggering event. The exception for this purchase which will make it option would be when the partner leaves or retires from this business.
There should be a clear definition on what permanent disability means. You have to ask about the conditions that will qualify a partner as permanently disabled. Usually, the suggested condition would be that the partner is disabled for one year already. Also, there should be no more definite expectation for the partner's return to practice.
Asking the method for the proper establishing of the price for the buy-out transaction is a given. This is mainly because there must be an easily agreeable buy-out price. The buy-out price can be determined via an appraisal. An alternative to appraisal would be to have a predetermined formula stated in the agreement for it.
You need to ask beforehand for instances of dispute. It might be necessary for partners to have a provision regarding binding arbitration as a fair mechanism in resolving disputes among parties involved. With arbitration, you will be able to enjoy benefits such as it becoming less painful and less costly compared to going to court.
Ask regarding the instances for when the partners sell partial interests of their shares. Generally, you should put a restriction on who the partner sells the shares or even just a part of it to. The said restriction on that will give the remaining partner in the practice the chance to decide who will become his or her business partner after the sale.
Every business will have accounts receivables, debts, equipment, and vehicles. In the agreement, it should stipulate clearly how the practice's debts and accounts receivables are to be handled upon buy-out. For the equipment and vehicles, it should be clearly cited how they are to be distributed between the partners involved in the said practice.
Ask about the payout terms for the said buy-out as well. Be sure to have a clear understanding regarding the terms stipulated in the agreement so that the transaction proceeds smoothly. The payout might be funded via an outside lender or it might be in installment. One can even choose to put a collateral on the line for this.
You have to ask about the restrictive covenant provisions of your selling partner. The partner who is selling his or her shares in the practice will have to sign the reasonable restrictive covenant. This should be a condition of sale included in the buy-sell agreement. Of course, weight your plans meticulously before signing the said terms of covenant.
First, better ask if this purchase is optional or if this will become required during a triggering event. For death and disability, you will most possibly want the purchase to be required during a triggering event. The exception for this purchase which will make it option would be when the partner leaves or retires from this business.
There should be a clear definition on what permanent disability means. You have to ask about the conditions that will qualify a partner as permanently disabled. Usually, the suggested condition would be that the partner is disabled for one year already. Also, there should be no more definite expectation for the partner's return to practice.
Asking the method for the proper establishing of the price for the buy-out transaction is a given. This is mainly because there must be an easily agreeable buy-out price. The buy-out price can be determined via an appraisal. An alternative to appraisal would be to have a predetermined formula stated in the agreement for it.
You need to ask beforehand for instances of dispute. It might be necessary for partners to have a provision regarding binding arbitration as a fair mechanism in resolving disputes among parties involved. With arbitration, you will be able to enjoy benefits such as it becoming less painful and less costly compared to going to court.
Ask regarding the instances for when the partners sell partial interests of their shares. Generally, you should put a restriction on who the partner sells the shares or even just a part of it to. The said restriction on that will give the remaining partner in the practice the chance to decide who will become his or her business partner after the sale.
Every business will have accounts receivables, debts, equipment, and vehicles. In the agreement, it should stipulate clearly how the practice's debts and accounts receivables are to be handled upon buy-out. For the equipment and vehicles, it should be clearly cited how they are to be distributed between the partners involved in the said practice.
Ask about the payout terms for the said buy-out as well. Be sure to have a clear understanding regarding the terms stipulated in the agreement so that the transaction proceeds smoothly. The payout might be funded via an outside lender or it might be in installment. One can even choose to put a collateral on the line for this.
You have to ask about the restrictive covenant provisions of your selling partner. The partner who is selling his or her shares in the practice will have to sign the reasonable restrictive covenant. This should be a condition of sale included in the buy-sell agreement. Of course, weight your plans meticulously before signing the said terms of covenant.
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