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A buy-sell agreement is a contract between business partners that outlines the course of action in the event of adverse occurrences during their partnership. Also referred to as a buyout agreement, a business will, or a business prenup, it is established while conditions are favorable to plan for unexpected events. This legal document defines responses to common situations known as the "five Ds": death, disability, divorce, disagreement, and default, which can severely impact a business. Having a buy-sell agreement ensures that there is a predefined strategy in place, similar to having a personal will, providing clarity and security for business owners during challenging times.
