Shotgun Agreements: Advantages and Disadvantages to Breaking Board Deadlock, Establishing Price and Offers
Recording of a 90-minute CLE video webinar with Q&A
This CLE course will provide advice to counsel on how and when--and when not--to utilize a shotgun buy-sell agreement. The panel will address the means to protect a closely-held business from the worst consequences of ownership and shareholder deadlock. Parties can establish a fair and equitable price to be determined in the future and what constitutes an irrevocable offer in these circumstances.
- Shotgun agreement requirements
- Agreement at a point in time
- Related to the transaction in future
- Define the trigger conditions
- Determine the price
- Easy to understand
- Easy to negotiate
- Pressure for a reasonable price
- Assumptions may not hold
- Minority shareholders may be at a disadvantage
- Uncertainty as to the outcome
- Best practices to revise or replace shotgun provisions
The panel will review these and other important topics:
- What constitutes a valid and enforceable shotgun agreement?
- How does a shotgun agreement vary from other types of buy-sell valuation provisions?
- What are the advantages and disadvantages of utilizing a shotgun agreement?
- What are the best practices for revising or replacing a shotgun agreement?
Peter A. Mahler
Mr. Mahler’s litigation practice concentrates on corporate dissolution proceedings, contested stock valuations,... | Read More
Mr. Mahler’s litigation practice concentrates on corporate dissolution proceedings, contested stock valuations, derivative actions and other disputes among co-owners of closely held business entities, including limited liability companies, partnerships and business corporations. He is a recognized authority and frequent lecturer on “business divorce,” about which he has written hundreds of articles on his widely followed blog, New York Business Divorce. He provides pre-litigation counseling to business owners involved in emerging disputes with business partners and, when litigation results, he represents clients through all phases of trial, appellate, mediation and arbitration proceedings.Close
Peter J. Sluka
Mr. Sluka represents a broad range of individuals and entities in all phases of complex commercial litigation,... | Read More
Mr. Sluka represents a broad range of individuals and entities in all phases of complex commercial litigation, corporate governance disputes, securities matters, and regulatory investigations. He has successfully represented prominent businesses and individuals from all industries in cases involving directors’ fiduciary duties, valuation of level 3 assets, material misrepresentations, and shareholders’ rights. Mr. Sluka regularly practices in New York State and federal courts.Close