DOES YOUR COMPANY HAVE A BUY- SELL AGREEMENT? IF NOT, WHAT HAPPENS WHEN ONE OF YOUR PARTNERS MOVES TO THE MAINLAND, PASSES AWAY, OR DIVORCES YOU?

If you own your company by yourself, you have little need for a buy-sell agreement. But if you have “partners” co-owners, or even a spouse, you need to be concerned about what will happen to the business if one of you passes-away, becomes incapacitated, retires, moves away, or just wants out. This should have been considered when you first started you business, but it may have been the last thing on your mind.

A buy-sell agreement is a binding contract between co-owners that controls when owners can sell their interest, who can buy an owner's interest, and what price will be paid. A  buy-sell agreement is a sort of prenuptial agreement between business co-owners. Having a buy-sell agreement in place minimizes disputes over the company value and eases the purchase of the withdrawing shareholder's interest by the corporation or other shareholders.

Buy-sell agreements have been used successfully to lower estate taxes in intergenerational businesses -- businesses where at least one co-owner plans to leave the interest to heirs who will remain active in the business.

DIVORCE. Also, consider this. Guam is a community property jurisdiction. In Guam , all earnings during marriage and all property acquired with those earnings are considered community property, owned equally by husband and wife. When property is divided during a divorce, each spouse can claim a right to all community property, including the spouse's business. To avoid this prospect, a good buyout or buy-sell agreement may require the former spouse of a divorced owner to sell any interest received in a divorce settlement back to the company or the other co-owners, according to a valuation method provided in the agreement.

Typically, a buy-sell agreement controls the following decisions:

• Whether a departing shareholder or partner must be bought out;

• Who can buy a departing owner's interest; Other owners? The company? Family members?

• What price will be paid for a shareholder's or partner's interest in the  company; and

• What events will trigger a buyout.

Buy-sell agreements can be extremely complex and should only be created by an experienced business attorney. They are necessary whenever a business has more than one owner, whether it is a partnership, corporation, or LLC.

May 10, 2008

Labor shortages in Guam may be less of a problem under the Consolidated Natural Resources Act of 2008, which President Bush signed into law on Friday.

Under the law, Foreign workers under the "H" category of visas, including H-2, which is generally used to hire construction workers, and H-1, which is used for skilled professional hires, will no longer be subject to the national, yearly visa limit if the hiring is for Guam or the CNMI. Also the current visa waiver -- which allows certain foreigners to enter Guam without visas if they don't stay beyond 15 days -- will be extended to 45 days and will also apply to the CNMI.

May 5, 2008 - bid protest filed
RFP No. CV08-007. Oceanic Collection Services protested the Chamarro Villages award of the bad debt collection services to Guam Mariannas Collection Agency. Documents related to the appeal can be found OPA Website.