Is There a Type of Contract for First Right of Refusal of an Agency Sale?

[PDX_Agent]

I am an agent with alot of P&C experience, our agency is a family agency that has been around since 1970.

The current plan is for me to buy the agency for a yet to be determined amount in February of 2013 when the current owner turns 65.

I know it is silly to have no arrangement in writing at this point, so I am trying to come up with some sort of contract to put under his nose to ensure my ability to take over.

Things I am currently worried about are the "oh let's wait one more year" statements that could happen when 2/2013 rolls around and the owner wants to wait longer. Also I am worried about some abhorrent price at that point, but I suppose that would be a risk I have to take.

I have started up an LLC and have some contracts with carriers directly to go into effect if I decide to branch out on my own, but if I do that then I will not be able to purchase the current agency I work at.

This post is getting long, so I guess the main question is how to go about protecting my interests or securing some sort of contract that will help me when that date rolls around and maybe the owner decides to not see at that point.

Thanks in advance.

 

[Guest]

"Is There a Type of Contract for First Right of Refusal of an Agency Sale? "

Yes - It's called a "Right of First Refusal" Agreement. Basically it binds the seller to giving you the buyer the right to purchase the business first, providing you accept the terms and conditions set forth either 1 now in the agreement i.e. purchase price, downpayment etc., or 2 as stated at time of sale. That's about all I know about them.