Nevada Buy-Sell Agreement Template
The Nevada rules that shape the document: the conditional both-spouse community property consent for a jointly managed business and its goodwill.
Introduction
A buy-sell agreement is the contract Nevada business owners put in place so it is clear, before any trigger, who may buy a departing owner's share, at what price, and on events such as death, disability, divorce, or a voluntary exit. In Nevada, one rule shapes the document beyond the national template more than any other: because Nevada is a community property state, neither spouse may sell, convey, or encumber the assets of a business, including its goodwill, where both spouses participate in managing that business, without the consent of the other (NRS 123.230(6)). If only one spouse manages the business, that spouse may act alone in the ordinary course, so the consent requirement is conditional. A Nevada buy-sell agreement should therefore carry a conditional both-spouse consent block that appears when both spouses help manage the business being transferred, and a valuation clause that pre-funds any buyout, since Nevada has no statutory election to purchase a departing owner's interest in lieu of dissolution.
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Key Things to Know
- 1
A Nevada buy-sell agreement is a binding contract among the co-owners of a business that fixes who can buy a departing owner's interest, the price or valuation method, and the triggering events, so a death, divorce, or exit does not force the business into a dispute or a sale to an outsider in Nevada.
- 2
Nevada is a community property state. Under NRS 123.230(6), neither spouse may sell, convey, or encumber the assets of a business, including its goodwill, where both spouses participate in managing that business, without the consent of the other. A conditional both-spouse consent block prevents later challenges to a Nevada transfer.
- 3
In Nevada, the both-spouse consent is conditional. NRS 123.230(6) says that if only one spouse participates in managing the business, that spouse may in the ordinary course acquire, sell, convey, or encumber the business assets and goodwill without the non-participating spouse's consent. Draft the Nevada consent so it triggers when both spouses manage.
- 4
Nevada has no statutory election that lets a corporation or the other owners buy a departing owner's interest at fair value to avoid dissolution. A Nevada buy-sell agreement must supply its own price, method, and funding, because there is no default statutory buyout to fall back on.
- 5
In Nevada, a transfer restriction binds a later buyer only if it is noted conspicuously on the share certificate, or, for uncertificated shares, the registered owner has been notified (NRS 104.8204). Add the legend when your Nevada company issues or endorses certificates so the restriction is effective against outsiders.
- 6
In Nevada, no notarization, witnesses, or government filing is required for a buy-sell agreement. It is valid as a signed writing under Nevada's statute of frauds (NRS 111.220). Keep the signed Nevada agreement with the company records and update the valuation periodically.
- 7
Fund the Nevada buyout before you need it. Because Nevada provides no statutory buyout at fair value, owners commonly use life or disability insurance, a sinking fund, or installment payments so the agreed valuation can actually be paid. Match the funding to your Nevada valuation clause.
Key decisions before you file
Before you file a Buy-Sell Agreement in Nevada, a few decisions shape the document: which option to choose and what each one means. The Buy-Sell Agreement guide walks through them.
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Nevada Requirements for Buy-Sell Agreement
Nevada Conditional Both-Spouse Community Property Consent
Nevada is a community property state. Under NRS 123.230(6), neither spouse may sell, convey, or encumber the assets and goodwill of a business where both spouses participate in its management without the other's consent. Include a conditional both-spouse consent that triggers when both spouses help manage the Nevada business being transferred.
Nevada Single-Manager Spouse Exception
The Nevada consent is conditional. NRS 123.230(6) provides that if only one spouse participates in managing the business, that spouse may in the ordinary course acquire, sell, convey, or encumber the business assets and goodwill without the non-participating spouse's consent. Draft the Nevada consent block so it applies only when both spouses manage.
Nevada Has No Statutory Buyout in Lieu of Dissolution
Nevada provides no statutory election that lets a corporation or the other owners purchase a departing owner's interest at fair value to avoid dissolution. A Nevada buy-sell agreement must supply its own price, valuation method, and funding, since there is no default statutory buyout to fall back on.
Nevada Transfer Restriction Noted on the Certificate
Under NRS 104.8204, a transfer restriction binds a later buyer in Nevada only if it is noted conspicuously on the share certificate, or, for uncertificated shares, the registered owner has been notified. Add the legend when your Nevada company issues or endorses certificates so the restriction is effective against outsiders.
Nevada Signed Writing; No Notarization Required
A Nevada buy-sell agreement is valid as a signed writing under Nevada's statute of frauds, NRS 111.220. No notarization, witnesses, or government filing is required. Keep the signed Nevada agreement with the company records and update the valuation periodically as ownership or value changes.