This agreement of purchase and sale of shares by shareholder template has 8 pages and is a MS Word file type listed under our finance & accounting documents.
Sample of our agreement of purchase and sale of shares by shareholder template:
AGREEMENT OF PURCHASE AND SALE OF SHARES BY ANOTHER SHAREHOLDER OR BY THE COMPANY This Agreement of Purchase and Sale of Shares (the "Agreement"), is made and effective [DATE], BETWEEN: [STOCKHOLDER 1 NAME] (the "Transferor"), an individual having his/her principal place of living located at: [ADDRESS] [STOCKHOLDER 2 NAME] (the "Purchaser"), an individual having his/her principal place of living located at: [ADDRESS] Hereinafter separately referred to as "Stockholder", and jointly as "Stockholders" AND: [YOUR COMPANY NAME] (the "Company"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] WITNESSETH: WHEREAS, the Stockholders together own [%] of the outstanding shares of capital stock of the Company, and WHEREAS, as used herein, the term "shares" shall mean all shares of common stock, at [VALUE] par share, of the Company now owned or hereafter acquired by the parties, and WHEREAS, the Stockholders are actively engaged in the conduct of the business of the Company, and it is contemplated that success or failure of the corporate enterprise will at all times depend in large measure on the personal abilities of the Stockholders, and WHEREAS, there is not now, nor is there likely in the future to be a substantial market for the shares of the Company, and WHEREAS, for the foregoing reasons, the parties desire to provide for the purchase by another Stockholder or by the Company of the stock of any party desiring to sell the same; and for the purchase by the Company of the stock of a deceased party. IT IS THEREFORE AGREED, in consideration of the mutual promises and covenants hereinafter set forth, as follows: Restriction During Life No stockholder shall transfer or encumber any of his/her shares of capital stock of the Company during his/her lifetime to any person, firm or Company, without the consent of the Company and the other Stockholder, unless the Stockholder desiring to make the transfer or encumber (hereinafter referred to also as the "Transferor") shall have first made the offer hereinafter described and such offer shall not have been accepted. Offer by the Transferor The offer shall be given pro rata initially to the other Stockholder(s) and shall consist of an offer to sell or encumber all of the shares of the capital stock of the Company owned by the Transferor, to which shall be attached a statement of intention to transfer, the name and address of such prospective transferee, the number of shares of capital stock involved, and the terms of such transfer or encumbrance. Acceptance of Offer Within [NUMBER] days after the receipt of such offer the other Stockholder(s) may, at their option, elect to accept the offer. If such offer is not accepted by the other Stockholder(s), the Company may within [NUMBER] days after the rejection of such offer, at its option, elect to accept the offer. The Company shall exercise its election to purchase by giving notice thereof to the Transferor and to the other Stockholder(s). The other Stockholder(s) shall exercise the election to purchase by giving notice thereof to the Transferor and to the Company. In either event, the notice shall specify a date for the closing of the transaction, which shall not be more than [NUMBER] days after the date of the giving of such notice. Purchase Price The purchase price for, or the consideration for the encumbrance of the shares of the capital stock of the Company owned by the Transferor shall be set forth in paragraph 3 hereof. Closing of Transaction The closing of the transaction shall take place at the principal office of the Company. The consideration shall be paid as provided for in paragraph 3 hereof. Certificates for all shares sold or encumbered hereunder, property endorsed to Company or to the purchasing Stockholder, as the case may be, shall be delivered by transferor not later than the date of closing. Release from Restriction If the offer is neither accepted by the Company nor by the other Stockholder(s), the Transferor may make a bona fide transfer to the prospective transferee named in the statement attached to the offer, such transfer to be made only in strict accordance with the terms therein stated. However, if the Transferor shall fail to make such transfer within [NUMBER] days following the expiration of the election period by the other Stockholder(s), such shares of capital stock shall again become subject to all of the restrictions of this Agreement, provided, however, that nothing contained herein shall be construed as releasing any shares of this Company from any restriction or requirement of law concerning transfer of such shares. Termination of Employment Any Stockholder whose employment in any capacity with the company or its subsidiaries terminates for any reason whatsoever, voluntarily or involuntarily, shall be considered as of the date of such termination of employment to have made an offer of all of his shares of stock subject to the terms of this Agreement, at the purchase price stated in paragraph 3 hereof. Subchapter "S" Election [US ONLY] If at the time of a transfer of stock permitted hereunder, the Company then is an "S" corporation, the transferee and new stockholder shall be required to consent in writing not to revoke such "S" election without the unanimous approval of all other stockholders. Purchase Upon Death Upon the death of a Stockholder (hereinafter referred to as Decedent), all of the shares of the capital tock of the Company owned by him/her, and to which he or his estate shall be entitled, shall be sold and purchased as hereinafter provided: Obligation of the Company to Purchase It shall be for the Company to purchase from the Decedent's Personal Representative, and the Decedent's Personal Representative shall be obligated to sell to the Company, all of the shares of the capital stock of the Company owned by the Decedent and to which the Decedent or his Personal Representative shall be entitled, at the price set forth in paragraph 3 hereof. Closing The closing of such purchase and sale shall take place at the offices of the Company, at a date selected by the Company upon [NUMBER] days notice to the Transferor which date shall be not more than [NUMBER] days following the date of the qualification of the Personal Representative and not less than [NUMBER] days following such date. Insurance To insure or partially insure its obligation under this Agreement to purchase from the estate of a deceased Stockholder the shares owned by him prior to his death, the Company shall have the option to purchase policies of insurance covering the lives of each Stockholder in any amount deemed desirable. In the event any Stockholder ceases to be a Stockholder of the Company, the Company shall terminate any such insurance on such Stockholder's life and in the event any Stockholder increases his holdings of the shares of the Company, the Company shall procure and maintain, if so desired by it, additional insurance on the life of such Stockholder proportionate to the increase in the holdings of such Stockholder. If the Company shall receive any proceeds of any policy on the life of the Decedent, such proceeds shall be used by the Company to pay the Decedent's Personal Representative to the extent of the purchase price of the Decedent's stock, such payment to be deemed made on account of such purchase price.
