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Buy-Sell Agreement

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Buy-Sell Agreement Powered By Docstoc
					Buy-Sell Agreement
This agreement is between shareholders in a corporation that places restrictions on the
sale or transfer of each shareholder’s ownership interest in the corporation. As drafted,
this agreement contains common provisions found in similar agreements, such as a
right of first refusal and a forced sale clause. This document contains standard language
as well as optional language, such as an arbitration provision, to allow the drafting
parties to tailor this agreement to their individual needs. This agreement is ideal for
small businesses that operate as corporations and want to place restrictions on when
and how shareholders can sell ownership in the corporation.
                                       BUY-SELL AGREEMENT

THIS BUY-SELL AGREEMENT (the “Agreement”) entered into this ______ day of
______________, 20__, by and between _____________________ (the “Company”) located at
______________________and __________________ the holders of shares of stock in the
Company (the “Shareholders”) collectively referred to herein as the “Parties”.

WHEREAS the Company is duly incorporated pursuant to the laws of the State of
__________________ and has an authorized capital consisting of _________________ shares
[Number of shares authorized to be issued by the Company] (the “Stock”) of which
[Number] ____ shares are currently issued and outstanding;

WHEREAS each Shareholder presently owns the following shares of:

                  Shareholders                                            Shares

                  [Name of Shareholder]                                   [# of Shares]
                  [Name of Shareholder]                                   [# of Shares]

AND WHEREAS the Company and the Shareholders desire to enter into an Agreement which
sets out the limitations for the transfer of the shares, the disposition of the Shares upon a
Shareholder’s death, and certain other matters.

NOW, THEREFORE in consideration of the foregoing and of the mutual promises and
covenants contained herein, and other good and valuable consideration, the receipt of which is
hereby acknowledged, the Parties hereto agree as follows:

                                                            I

                                                 RESTRICTIONS

1.01           No Shareholder of the Company shall transfer, sell, assign, pledged or
hypothecate his/her Shares to any other party, whether now owned or hereafter acquired, except
as permitted by and in accordance with this Agreement.

1.02             A Shareholder of the Company may transfer his/her Shares to a grantor trust for
his/her benefit.

1.03            By the Company’s execution of this Agreement, the Company hereby agrees that
it shall not transfer any of the Shares on the books of the Company, unless such transfer of
Shares is permitted by the terms of this Agreement and shall not issue any Shares of the
Company except in accordance with this Agreement.

                                                           II

                                        RIGHT OF FIRST REFUSAL


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2.01           Any Shareholder who desires to sell all or any of his/her Shares shall give notice
of such proposed sale (the "Notice") to the Company and to the other Shareholders and shall set
out in the Notice the number and class of his/her Shares that he/she desires to sell (the "Offered
Shares") and the terms upon which and the price at which he/she desires to sell the Offered
Shares (the "Purchase Price").

2.02           Upon the Notice being given, the other Shareholders shall have the right to
purchase all, but not less than all, of the Offered Shares for the Purchase Price. The other
Shareholders shall be entitled to purchase the Offered Shares pro rata based upon the number of
Shares beneficially owned by the Shareholder or to purchase in such other proportion as the
Shareholders may agree in writing.

2.03            Within ________ (___) business days of having been given the Notice, each
Shareholder who desires to purchase all of the Offered Shares that he/she is entitled to purchase
shall give notice to the Shareholder, to the Company and to the other Shareholders. If any
Shareholder does not give such notice, the Offered Shares that he/she had been entitled to
purchase (the "Rejected Shares") may instead be purchased by the Shareholders who did give
such notice, pro rata based upon the number of Shares beneficially owned by such Shareholders
as between themselves or in such other proportion as such Shareholders may agree in writing,
and, within ______ (____) business days of the expiration of the _______ (___) business day
period specified in this paragraph. Each Shareholder who desires to purchase all of the Rejected
Shares that he/she is entitled to purchase in accordance with the provisions of this paragraph
shall give an additional notice to the Shareholder, to the Company and to the other Shareholders.
If any Shareholder entitled to give the said additional notice does not do so, the Rejected Shares
that he/she had been entitled to purchase may instead be purchased by the Shareholders who did
give such notice, and so on from time to time until the Shareholders are willing to purchase all of
the Offered Shares or until they are not willing to purchase any more. If the Shareholders are
willing to purchase all, but not less than all, of the Offered Shares, the transaction of purchase
and sale shall be completed in accordance with the terms set out in the Notice.

2.04            If the Shareholder defaults in transferring the Offered Shares to the Shareholders
in accordance with the terms set out in the Notice, the Secretary of the Company or any other
authorized officer, is authorized and directed to receive the purchase money and to thereu
				
DOCUMENT INFO
Description: This agreement is between shareholders in a corporation that places restrictions on the sale or transfer of each shareholder’s ownership interest in the corporation. As drafted, this agreement contains common provisions found in similar agreements, such as a right of first refusal and a forced sale clause. This document contains standard language as well as optional language, such as an arbitration provision, to allow the drafting parties to tailor this agreement to their individual needs. This agreement is ideal for small businesses that operate as corporations and want to place restrictions on when and how shareholders can sell ownership in the corporation.
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This document is also part of a package Bill of Sale 14 Documents Included