Buy and Sell Agreements are legal enforceable contracts. Cross-Purchase Agreements -- A Contract between the owners to specify what happens when a triggering Event occurs (such as death, divorce, retirement, disability, etc.) and set out the legal obligation of the remaining party or parties to buy out the Co-Owner's interest. Redemption Agreement -- A Contract between the business entity and the co-owners that when the triggering Event occurs, the entity will be legally obligated to buy. This would set out all the terms of purchase and security. This could also be a Liquidation Agreement. Hybrid Agreement -- To be a combination of the Cross-Purchase and Redemption Agreements. Right of First Refusal -- This gives an opportunity to the Co-Owner(s) to match a Sale Agreement within a certain time, and if not, then the selling Co-Owner can sell to any party whomsoever, so long as the closing is those exact terms and occurs within a stated period of time. In the next article, see: What Subjects Must be Covered in a Buy and Sell Agreement.