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Broadcast Date: September 10, 2026
Presenters: Travis W. Harms, CFA, CPA, ABV and Zac L. Lange, CPA, ABV
Course Overview and Purpose
This webinar is designed to help attorneys, estate planners, family business directors, owners, management, as well as other professional advisors understand how a thoughtfully designed buy-sell agreement can reduce uncertainty and improve outcomes when ownership interests change hands. The program examines the purpose of buy-sell agreements, key valuation provisions, formula-based and appraisal-based pricing methods, and alternative appraiser structures. It also addresses practical considerations for implementing and updating the valuation process, including timing, costs, funding terms, and appraiser continuity. How to identify and stress-test common drafting and valuation failure points before a triggering event creates conflict, delay, or unintended economic consequences is also covered.
Learning Objectives
Upon completion of this program, participants will be able to:
Identify the key valuation provisions that should be addressed in a buy-sell agreement, including standard of value, level of value, valuation date, appraiser qualifications, and appraisal standards.
Distinguish between formula-based pricing provisions and appraisal-based valuation processes and evaluate the strengths and limitations of each.
Compare single-appraiser and multiple-appraiser structures and assess how each affects timing, cost, uncertainty, and the potential for disputes.
Evaluate how payment and funding terms, life insurance proceeds, entity tax treatment, and valuation discounts can affect the economics of a buy-sell transaction.
Recognize common drafting and process failures that can lead to inconsistent valuation conclusions, shareholder disputes, or litigation.
Apply a practical “stress-test” to an existing buy-sell agreement to identify unresolved valuation, procedural, and implementation issues before a triggering event occurs.
Content Outline
I. What Do Buy-Sell Agreements Do?
Purpose and function of buy-sell agreements in governing future ownership transactions
Comparison of formula provisions and appraisal-based valuation processes
Five defining elements of a valuation assignment
Relationship between valuation conclusions, funding provisions, and shareholder notes
II. Designing the Valuation Process
Importance of addressing valuation procedures before a triggering event occurs
Comparison of multiple-appraiser and single-appraiser structures
Roles that may be assigned to a third appraiser
Advantages and disadvantages of multiple-appraiser processes, including timing, cost, uncertainty, and potential advocacy
Alternatives for selecting an appraiser and establishing value before or after a triggering event
III. Clarifying the Valuation Process
Establishing clear expectations regarding how the appraisal process will operate
Use of initial and periodic appraisals to maintain consistency and reduce uncertainty
Setting realistic timetables for completion of the valuation
Allocation of appraisal costs and treatment of economic changes during delays
Planning for continuity if the designated appraiser or appraisal firm becomes unavailable
IV. Stress-Testing Failure Points
Treatment of life insurance proceeds in determining value and funding a buyout
Other valuation issues that can materially affect conclusions, including tax-related assumptions and discounts
Common reasons valuation processes fail, such as ambiguity, information asymmetry, weak standards, unrealistic timelines, and appraiser advocacy
Review of existing agreement provisions to identify unresolved questions before a triggering event or dispute occurs