To secure the money necessary to make a buy/sell agreement work, creative financing is often required. One option is a life insurance policy with a cross-purchase agreement. Each owner buys a policy on the other owners. That may not be enough either, however. What happens if one of your partners becomes disabled but does not pass away, as in one of the examples we cited earlier? Disability insurance could protect against such a scenario, but a large policy is hard to come by, especially when it involves buyouts. Another option could be Key Employee insurance. The point is, there are options out there, but you (or your attorney) must really dig to find them.

Next post: other buy/sell agreement issues that can lead to business brawls.