When a business is owned by more than one person, it's generally advisable for the owners to enter into a contractual agreement that prescribes what will happen if an owner dies, becomes disabled, retires or otherwise leaves the company.
Some market analysts predict that the COVID-19 crisis may trigger an increase in buyouts. For example, some struggling owners may decide to throw in the towel after months of teetering on the verge of bankruptcy. Or squabbling partners may disagree about the future of the business and decide to part ways.
So, now is a good time for owners to draft or update a buy-sell agreement. Here's a look at common valuation issues and potential pitfalls to avoid.