Protecting the Partnership: Buy-Sell Coordination & Funding

A legal document without a funding mechanism is just a set of empty promises.

Most partnerships are built on trust and shared vision. However, the "5 Ds"—Death, Disability, Divorce, Departure, or Disqualification—can instantly turn a thriving business into a legal and financial nightmare. At Global Investment Strategies, we ensure that your Buy-Sell Agreement is more than just a stack of papers; we ensure it is a funded mandate for business continuity.

We work as your technical advocate to align your legal obligations with your financial reality, protecting both the surviving partners and the families involved.

The Funding Gap: Why Your Current Agreement May Fail

The most common failure in business planning isn't the lack of an agreement—it's the Valuation Gap. If your agreement says a partner’s share is worth $2M, but the company only has $200k in cash, the surviving partner is forced into a predatory loan or, worse, a forced liquidation.

We coordinate three primary funding solutions to ensure the cash is there exactly when it’s needed:

1. Cross-Purchase Structures

In this setup, each partner owns a policy on the other. It is often the most tax-efficient method, providing the surviving partner with a "step-up" in cost basis, which can significantly reduce taxes when they eventually sell the business later.

2. Entity-Purchase (Redemption) Agreements

The business itself owns the policies and buys back the shares of the departing partner. This simplifies the process when there are multiple partners involved and ensures the company's balance sheet remains stable during a transition.

3. Disability Buy-Out (DBO)

Most owners plan for death, but few plan for a partner who can no longer work but still owns 50% of the equity. We implement DBO structures that provide the capital to buy out a disabled partner, allowing them to exit with dignity while the business remains operational.

Our Coordination Process

We don't replace your attorney; we empower them. Our role is to ensure the "Three Pillars of Continuity" are perfectly synced:

The Valuation: Ensuring the price defined in the agreement matches the current market reality of your business.
The Legal Trigger: Coordinating with counsel to ensure "Triggers" (like disability) are clearly defined to avoid litigation.
The Funding: Stress-testing the insurance or investment vehicles to guarantee they can meet the obligation at a moment's notice.

Business Planning

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Move from Uncertainty to Financial Clarity

Complex financial decisions benefit from experienced and thoughtful execution Schedule a brief date and time to discuss your goals and how we will help.