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lack of negotiations among the parties. Tamma Hatten did not
seek separate legal or other professional counsel in connection
with the sale. Instead, she relied on Dave True and his advisers
to determine the sales price under the buy-sell agreements and to
structure the methods of payment. Accordingly, Dave True’s
advisers drafted an agreement outlining the terms of sale and set
up an escrow account for Tamma Hatten to receive roughly half of
the sales proceeds. The escrow arrangement, which departed from
the requirements of the buy-sell agreements, was meant to reserve
assets to pay Tamma’s share of contingent liabilities and to
provide a management vehicle for her investments. Finally, Tamma
Hatten was required (effectively) to pay the other owners in
order to sell her interests in certain profitable companies that
had negative book values at the buy-sell valuation date.
As previously discussed, Tamma Hatten, once she gave notice
that she and her husband would no longer be active participants,
was bound to sell her interests in the True companies pursuant to
the terms of the buy-sell agreements. However, it is likely that
an unrelated party in similar circumstances would have hired
separate counsel to interpret the buy-sell agreement terms,
review the sales agreements, and question the reasonableness of
being required to pay (i.e., take an offset against sales
proceeds) to sell interests in profitable companies. In
addition, an unrelated seller would want to hire her own
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