Paul Hood, one of the leading experts on buy-sell agreements, has a new book on the subject highlighted in this week’s New York Business Divorce and also featured in an interview with Paul on a new episode of the Business Divorce Roundtable podcast.
Continue Reading Everything You Ever Wanted to Know About Buy-Sell Agreements: A Conversation With Paul Hood

The interaction between an LLC’s operating agreement and a subsequent, informal deal between the members raises difficult questions surrounding the enforceability of either agreement. In a recently-filed Manhattan Commercial Division case, the Court granted the plaintiff a preliminary injunction, signaling to the parties that the plaintiff was likely to succeed on his claim to enforce the informal deal notwithstanding arguably contrary provisions in the operating agreement. The case reminds us that the formality requirements of an LLC operating agreement may give way to an informal agreement when both LLC members manifest their intent to be bound by the informal agreement.
Continue Reading A Shotgun Buy-Sell Agreement and an Email Deal Walk into a Beachside Bar . . .

It’s no match for Jarndyce v. Jarndyce, but 15 years is some sort of record for litigating the breakup of a single-asset real estate partnership during which one of the partners died, triggering the other’s option to purchase under a fixed-price formula. Read about it in this week’s New York Business Divorce.
Continue Reading A Partnership Dissolution in Three Acts Over Fifteen Years and Counting

This week’s New York Business Divorce, authored by Peter J. Sluka, looks at a first-impression decision by the Delaware Chancery Court in which the court characterized a shareholder buy-out provision as a call option, with consequences for the company’s attempt to revoke its initiation of the buy-out.
Continue Reading Consider Whether Your Buy-Sell Provision is a Call Option Before Pulling the Trigger

Shotgun buy-sell provisions frequently are included in shareholder and operating agreements, but there’s little evidence that business owners “pull the trigger” with any frequency. This week’s New York Business Divorce looks at one of the rare litigations involving a shotgun provision in action.
Continue Reading Aim Carefully Before Pulling Trigger on Shotgun Buy-Sell Agreement

Deadlock in LLCs with two equal members can be a major problem and trigger for dissolution proceedings, which is why it’s crucial to consider deadlock avoidance provisions in the operating agreement. This week’s New York Business Divorce, and a related podcast interview on the Business Divorce Roundtable, features noted LLC expert and attorney John Cunningham on the topic of LLC deadlock and how to avoid it.
Continue Reading John Cunningham on Avoiding Deadlock in Two-Member LLCs

Agreements providing for compulsory buyouts upon termination of a minority shareholder’s employment can be a good thing. Complications or sometimes litigation sets in, however, when termination for cause is linked to a devalued buyout formula, as illustrated in the case highlighted in this week’s New York Business Divorce.
Continue Reading The Hidden Cost of a Devalued Buyback Upon Termination for Cause