Stockholder Buy-Sell Agreement Template

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BUY-SELL AGREEMENT BETWEEN STOCKHOLDERS
AGREEMENT made this ___ day of ______, ____, by and between all of the
undersigned shareholders (stockholders) and ______________(Company), a corporation
organized pursuant to the laws of the State of __________, having its principal place of
business at ______________________________(address) (Corporation).
PREAMBLE
WHEREAS, Stockholders each own shares of Corporation’s outstanding capital
stock; and
WHEREAS, Stockholders wish to restrict the transfer of the Corporation’s stock
by providing that the stockholder who wants to sell his tock first offer it for sale to the
Corporation; and
WHEREAS, Stockholders intend to accomplish this by the provisions of this
Agreement.
IT IS AGREED AS FOLLOWS:
1. Buy-Sell. Stockholders will sell their stock in accordance with the provisions of
this Agreement.
2. Consent of Stockholders. If any stockholder wishes to sell all or any part of his
capital stock to a third party and has not received the Corporation’s prior consent
to the sale, he may sell his capital stock only after offering it to the Corporation
on the terms and conditions set out in this Agreement.
3. Offer to Sell Stock. The stockholder desiring to sell all or part of his capital stock
shall notify the Corporation by certified or registered mail, return receipt
requested, or in person at the Corporation’s principal place of business to the
Secretary of the Corporation, that he has a bona fide offer for the sale of the stock.
The notice shall state the name and address of the principal person or entity
making the offer, the number of shares to be sold, the sales price and terms of
payment. The notice must also contain an offer to sell the stock to the Corporation
for the same price and for the same terms of payment as those of the bona fide
offer.
4. Acceptance of Offer to Sell Stock. The Corporation or stockholders shall have the
right to accept the offer or to respond with a counteroffer for a period of 180 days
from the date the sellers notice was received at the principal place of business.
The offer of counteroffer may be accepted only by certified or registered mail,
return receipt requested, addressed to the stockholder desiring to sell the stock.
The acceptance shall be effective upon mailing.
5. Purchase of Stock upon Termination of Employment. For shares of stock issued to
employees for one dollar ($1.00) per share the Corporation shall redeem such
shares for the amount of the purchase price if the employee terminates
employment within the first eighteen months of the date said employee began
employment. If the employee terminates employment during the period beginning
on the first day of the nineteenth month and ending on the last day of the sixtieth
month from the date said employee began employment, then the employee’s stock
BUY-SELL AGREEMENT BETWEEN STOCKHOLDERS
AGREEMENT made this ___ day of ______, ____, by and between all of the
undersigned shareholders (stockholders) and ______________(Company), a corporation
organized pursuant to the laws of the State of __________, having its principal place of
business at ______________________________(address) (Corporation).
PREAMBLE
WHEREAS, Stockholders each own shares of Corporation’s outstanding capital
stock; and
WHEREAS, Stockholders wish to restrict the transfer of the Corporation’s stock
by providing that the stockholder who wants to sell his tock first offer it for sale to the
Corporation; and
WHEREAS, Stockholders intend to accomplish this by the provisions of this
Agreement.
IT IS AGREED AS FOLLOWS:
1. Buy-Sell. Stockholders will sell their stock in accordance with the provisions of
this Agreement.
2. Consent of Stockholders. If any stockholder wishes to sell all or any part of his
capital stock to a third party and has not received the Corporation’s prior consent
to the sale, he may sell his capital stock only after offering it to the Corporation
on the terms and conditions set out in this Agreement.
3. Offer to Sell Stock. The stockholder desiring to sell all or part of his capital stock
shall notify the Corporation by certified or registered mail, return receipt
requested, or in person at the Corporation’s principal place of business to the
Secretary of the Corporation, that he has a bona fide offer for the sale of the stock.
The notice shall state the name and address of the principal person or entity
making the offer, the number of shares to be sold, the sales price and terms of
payment. The notice must also contain an offer to sell the stock to the Corporation
for the same price and for the same terms of payment as those of the bona fide
offer.
4. Acceptance of Offer to Sell Stock. The Corporation or stockholders shall have the
right to accept the offer or to respond with a counteroffer for a period of 180 days
from the date the sellers notice was received at the principal place of business.
The offer of counteroffer may be accepted only by certified or registered mail,
return receipt requested, addressed to the stockholder desiring to sell the stock.
The acceptance shall be effective upon mailing.
5. Purchase of Stock upon Termination of Employment. For shares of stock issued to
employees for one dollar ($1.00) per share the Corporation shall redeem such
shares for the amount of the purchase price if the employee terminates
employment within the first eighteen months of the date said employee began
employment. If the employee terminates employment during the period beginning
on the first day of the nineteenth month and ending on the last day of the sixtieth
month from the date said employee began employment, then the employee’s stock
shall be valued as determined in Section Three. The amount so determined in
Section Three shall be paid out in installments at the end of each calendar year.
The installments shall be determined for each calendar year by multiplying the
amount determined in Section Three by a fraction whose numerator is the number
of months the employee has not worked for the Corporation for that calendar year
and using a denominator which is sixty months less the number of months the
employee was employed by the Corporation. After the employee has been
employed by the Corporation for sixty months, any sale shall be made in
accordance with the provisions of Section Three.
6. Sale to Outsider. If the Corporation and Stockholder to whom the offer was made
fails to accept the offer within 180 days after the sellers notice of the offer was
received or if the Corporation notifies the offering stockholder that it consents to
the sale or will not accet the offer, the offering stockholder may sell hi stock only
to the person or entity named in the sellers notice at the price and upon the terms
of payment set out in the sellers notice; provided that the buyer shall become
subject to all of the terms and conditions of the Agreement. However, the sale
must be complete within 30 days following the date of the Corporation’s notice,
or within 30 days after the end of the 180 day period, which ever occurs sooner.
7. Failure to accept Counteroffer. If the Corporation makes a counteroffer to
purchase the Stockholder’s shares as described in Section 3, the offering
stockholder will within 60 days notify the Board of his decision to accept the
counteroffer or to retain the shares offered.
8. Transfer due to Bankruptcy. In the event that the stock of a stockholder shall be
transferred by attachment or levy, or made subject to a charging order, or in the
event that a stockholder is adjudicated bankrupt or makes an assignment for the
benefit of creditors, upon the Corporation’s discovery of such transfer, the
Corporation shall have the right to purchase all of the capital stock owned by the
stockholder immediately prior to the transfer for a purchase price determined in
accordance with the terms of Section Three. The selling stockholder shall vote
when the Corporation is determining whether to purchase his stock, either in his
capacity as a stockholder or a director, in any manner that the remaining
stockholder, or majority of the remaining stockholders, as the case may be, shall
so direct. The Corporation shall exercise its election to purchase within sixty (60)
days from the date the Corporation receives written notice of the transfer by
giving notice thereof in writing mailed to the transferring stockholder and the
third party who possesses the stock or an interest therein, and such notice shall
specify a date for the closing of the purchase. In the event the purchase price
determined pursuant to the terms herein is greater than the indebtedness owed to
such assignee, trustee, bankruptcy or attaching court or officer (the
“Transferees”), the amount so owed the Transferees shall be paid thereto, and the
balance, minus any proper items of expense, shall be distributed to the
stockholder making the Transfer.
If the Corporation or the remaining stockholder(s) do no elect to purchase he sock
within the required time limits, then the Corporation and the remaining
stockholder(s) shall be deemed to have consented to the transder; provided that
said Transferee shall become subject to all of the terms and conditions of this
Agreement and shall execute a supplement to that effect; however, the failure to
execute such supplement shall not affect the applicability of the Agreement to any
party becoming a stockholder of the Corporation.
9. Notice on Stock Certificate. The following legend shall be placed on
Corporation’s certificate of stock immediately following the execution of this
Agreement:
“TAKE NOTICE that the sale, assignment, ransfer or pledge of shares
represeneted by this Certificate are subject to restrictions contained in an
agreement dated the ____day of ______, 20__, between
_________________, and the Corporation, a copy of which is on file at
the Corporation’s offices.”
10. Termination of Agreement. This Agreement will terminate upon occurrence of
any of the following events:
a. Voluntary or involuntary termination of Corporation’s business;
b. By written agreement of the stockholders;
11. Agreement binding on Third Persons. This Agreement is binding on
Stockholders and Corporation, their heirs, legal representatives, successors,
and assigns.
12. Construction. This Agreement shall be construed in accordance with the laws
of the State of Maryland, excluding the conflict of law rules of that state.
13. After Acquired Stock. The provisions of this Agreement shall also apply to all
shares of stock of the Corporation hereafter issued, and shall be binding upon
and shall inure to the benefit f all persons hereafter becoming Stockholders of
the Corporation, whether through the purchase of shares of newly issued stock
from the Corporation or through the acquisition of shares from a Stockholder,
and accordingly the term “Stockholders” shall be deemed to include such
persons to the same extent as had they originally executed this Agreement as
such. All persons herinafter becoming Stockholders of the Corporation shall
execute a supplement to the effect that they agree to be bound by all the terms
and conditions and restrictions set forth in this Agreement.
14. Invalid Provisions. The invalidity or uneforceability of any particular
provision of this Agreement shall not affect the other provisions hereof, and
the Agreement shal be construed in all respects as if such invalid o
unenforceable provisions were omitted.
15. Boid Transactions. Any sale of stock which does not comply with the terms of
this Agreement shall be null and void.
16. Tax Status of the Corporation. (a) The Corporation covenants that within three
and one-half (3-1/2) months from the end of each and every taxable year of
the Corporation, it shall distribute to its Stockholders on a pro rata basis, an
amount at least equal to the maximum individual federal and state income tax
which can be assessed on the taxable income of the Coporation and take all
other steps necessary and appropriate in connection therewith, provided such
distribution will not violate applicable state laws governing dividend
distributions. This provision shall apply to any person who was a Stockholder
of the Corporation during the time in which taxable income was earned by the
Corporation which was or will be taxed to such individual. The Corporation
further covenants and agrees that it will not without the consent of all
Stockholders, take any action that would be reasonably likely to, in the
opinion of counsel to the Corporation, terminate the Corporation’s retention of
its S corporation status.
a. (b) Each Stockholder hereby covenants and agrees that:
i. He shall not transfer any share of stock of the Corporation
unless (A) at the option of the Board of Directors of the
Corporation, the Corporation obtains a legal opinion that such
Transfer will not adversely affect the Corporation’s S election
and (B) the transferee consents in writing to be bound by this
Agreement as if an original party hereto and consents in
writing not to refuse any consent to continue the S election.
Nothing contained herein shall operate to permit a sale of stock
if such sale is otherwise restricted by the terms of this
Agreement, any governmental statute, regulation or rule;

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