A buy-sell agreement is an agreement between the owners (shareholders) of a firm, defining their mutual obligations, privileges, protections, and rights. This form is a generic example that may be referred to when preparing such a form for your particular state. It is for illustrative purposes only. Local laws should be consulted to determine any specific requirements for such a form in a particular jurisdiction.
A North Carolina Shareholders' Agreement with a Buy-Sell Agreement Allowing the Corporation the First Right of Refusal to Purchase the Shares of a Deceased Shareholder, should the Beneficiaries of the Deceased Shareholder Desire to Sell such Shares, is a legally binding contract outlining the rights and obligations of shareholders in a corporation. This agreement is specifically designed to address the situation where a shareholder passes away, and their beneficiaries wish to sell the shares. This type of agreement is a proactive measure taken by corporations to control the transfer of shares and maintain stability within the company. By granting the corporation the first right of refusal, the agreement ensures that the remaining shareholders and the corporation have the option to acquire the shares before they are offered to external buyers. The main purpose of this agreement is to provide a predefined process for the purchase and sale of shares in case of the death of a shareholder. It prevents the shares from being sold to third parties without the corporation and remaining shareholders having an opportunity to acquire them. This arrangement helps maintain the control and continuity of the corporation and prevents unwanted external influences. Several types of North Carolina Shareholders' Agreement with a Buy-Sell Agreement Allowing the Corporation the First Right of Refusal may exist, such as: 1. Shotgun Agreement: This type of agreement provides a mechanism for triggering a quick sale of shares. If one shareholder wishes to sell, they can propose a purchase price to the corporation, and the other shareholders have the option to either purchase the shares at the offered price or sell their own shares to the proposing shareholder at the same price. 2. Put-Call Agreement: This agreement allows a shareholder to "put" their shares up for sale, while the corporation and other shareholders hold the option to "call" and purchase the shares at a predetermined price. The decision to sell or purchase lies with the respective parties. 3. Right of First Offer Agreement: In this type of agreement, the shareholder's beneficiaries must first offer the shares to the corporation before considering external buyers. The corporation has the first right to accept or decline the offer based on predetermined terms. 4. Right of First Refusal Agreement: Similar to the previous agreement, the shareholder's beneficiaries must provide the corporation with a bona fide offer from an external party before selling the shares. The corporation then has the right to match the offer and purchase the shares themselves. Each of these agreements ensures that the corporation and its existing shareholders have the first opportunity to acquire the shares of a deceased shareholder. By having the provisions outlined in a legally-binding agreement, potential disputes among shareholders can be minimized or avoided, ensuring a smooth transition in ownership and preserving the interests of the corporation as a whole.
