About this episode
Get alignment with your minority partners.
Buy out your partners (without sabotaging your business).
Use a shotgun clause in your shareholder’s agreement.
Distinguish between a non-compete and a non-solicitation agreement.
Protect your reputation through a lawsuit.
Structure your partnership agreement to protect the value of a service business in a dispute.
Show Notes & Links
Can We Buy You a Coffee?
We’re conducting a “Built to Sell” Reader & Listener survey. It takes about 3 minutes to complete. We’ll send you a Starbucks gift card as a thank you for taking a few minutes. We’ll share the results here in the coming weeks. Please take 3 minutes and answer our reader survey.
Want to increase the value of your company? Sign up for Built to Sell News
Want to Sponsor an Episode? Click Here
Want a business that’s Built to Sell? Grab a free VidGuide trial.
A “shotgun clause” is a type of buy-sell agreement often included in the partnership or shareholder agreements of a privately-held company. This clause is designed to resolve situations where partners or shareholders want to separate from each other due to disagreements or other issues.
How it Works:
- Triggering Event: One partner/shareholder (the “Offeror”) initiates the shotgun clause, typically when there is a deadlock or disagreement that can’t be resolved.
- Buy or Sell Offer: The Offeror proposes a price per share to buy the other partner’s/shareholder’s (the “Offeree”) shares or sell their own shares to the Offeree.
- Decision Time: The Offeree must decide whether to sell their shares at the proposed price or buy the Offeror’s shares at the same price.
- Binding Decision: Once the Offeree makes a decision, both parties are bound by it, meaning the Offeree must either sell their shares or buy the Offeror’s shares at the stipulated price.
About Our Guest
Mark Ferrier has had the opportunity to initiate seven different companies, exiting three in multiple forms and experiencing failure with one. Over his 25-year career in growing businesses and building brands, many of the enterprises he has been involved with have earned recognition on the Growth 100 List and the Profit Hot 50 start-up lists. He exited his last business, Traffikgroup.com, in 2015 to an Onex company and subsequently led their global growth strategy with the brand and marketing organization globally, increasing revenue from $20M USD to $75M USD before his departure in 2019.
Mark’s business philosophies are anchored in the belief that value creation is not solely financial. It must also be demonstrable in the growth of human capital and the communities in which businesses operate, both physically and virtually.
In 2021, he founded Kurious Inc. and &Capital, with a straightforward mission to assist companies in growth based on his experiences and strategies around growth, serving as an entrepreneur, creator, business builder, and investor.
Want to nominate a founder? Click here.