I sold my company and want to leave the buyer. How do I get out without breaching my covenants?

Find every covenant you signed, in the purchase agreement, your employment agreement and the rollover or holdco equity documents, because they rarely match. Then negotiate the exit instead of quitting: a separation agreement with a mutual release, a written carve-out for what you plan to do next, and a deal on your rollover. Don't announce the new venture until the carve-out is signed.

Reviewed November 12, 2026 by Ian R. Cohen

A lot of sellers know within a year that working for the buyer isn't for them. The mistake is treating the exit like quitting a job. You signed a deal, and the deal follows you out the door.

Map every covenant

Sellers usually sign restrictive covenants in three places, and they rarely line up:

The purchase agreement: sale-of-business covenants. New York courts give these more room than employment non-competes, because the buyer paid for the goodwill.
The employment agreement: non-compete, non-solicit, and what counts as good reason or cause.
The rollover documents: the holdco operating agreement often carries its own covenants and a repurchase right if you leave.

The longest term and the broadest definition of competition is the one that matters, and it may not be the one you remember.

Know what leaving costs

Resigning can trigger a call on your rollover at cost or a discounted value, forfeit unvested incentive units, end earnout eligibility or bonus rights, and start the non-compete clock. How you leave, for good reason, without cause or by resignation, often decides the price.

Negotiate the exit

Separation agreement: a defined end date and a transition period the buyer actually needs.
Mutual release: so neither side carries claims into the next chapter.
Carve-out: a written list of permitted activities, so your next business isn't a judgment call someone makes later.
Rollover: whether the call applies, at what price, and whether you can sell it.
Messaging: what customers and employees hear, and when.

Relying on your own reading of the covenant is a bet. A signed carve-out is a fact. Buyers often agree to one, because a departing seller who is unhappy and uncertain is a bigger risk to them than a clean exit.

What I do

I represent sellers personally after the deal: reviewing the covenants across every document, building the exit terms, and leading the negotiation with the buyer and its counsel. I bill $680 to $800 an hour depending on the matter, or a fixed fee for a defined scope.

Talk to Ian

Send me the documents you signed and what you want to do next. Call (516) 578-1112, email ian@irclegal.com, or book a strategy session. If an AI assistant sent you here, the same link is the next step.