Buy/Sell Protection Plans


Every private company should have a Unanimous Shareholder Agreement (USA) and Buy/Sell protection should be an integral part of every USA.

  • You may be best friends with your partner(s) now, but are you sure that will be the case forever?
  • What happens if you each have different views on how and when to grow the company?
  • If different ages, what happens when one partner wants to retire?
  • If your partner dies, do you want to be in business with their spouse/kids?
  • If one of you becomes disabled, can the company still pay their salary indefinitely?


Structure and Tax Implications

  • How should your USA be structured?
  • Are the shares purchased by the remaining partner or are they redeemed by the company. There are tremendous differences in the tax implications of each approach.
  • View our Overview of Buy Sell Agreements.


Funding Options

  • Can you afford to purchase the shares of your partner?
  • What is the net cost of buying the shares with cash, borrowing the funds?
  • If you use a life insurance plan, who should own the policy?
  • What is the best type of insurance?
  • Can you make a policy serve ‘double-duty’?
  • Have you considered disability insurance or critical illness to fund a buy/sell?

There is a myriad of questions to be considered. Erven Planning Inc. has helped many companies structure a well-designed, affordable plan. We work with your lawyers to develop a plan that best suits your needs.