Nebraska Buy Sell Agreement Between Shareholders and a Corporation

• Category: Contracts - Buy Sell - Stock Purchases
• State: Multi-State
• Control #: US-00442
• Format: Word; Rich Text

Description

The purpose of this agreement is to provide for the sale by a stockholder during his/her lifetime, or by a deceased stockholder's estate, and to provide all or a substantial part of the funds for the purchase. The form contains the following provisions: total value of the capital stock, procedure upon the death of a stockholder, and amending procedures for the agreement. A Nebraska Buy Sell Agreement Between Shareholders and a Corporation is a legally binding contract that outlines the terms and conditions for the sale or transfer of shares between a corporation and its shareholders. This agreement is specific to the state of Nebraska and is commonly used to provide a clear mechanism for buying or selling shares in a closely held corporation. There are several types of Nebraska Buy Sell Agreements, including the following: 1. Cross-Purchase Agreement: In this type of agreement, the shareholders of a corporation agree to buy each other's shares in the event of certain triggering events like death, disability, retirement, or voluntary departure. Each shareholder agrees to purchase the shares of the departing shareholder at a predetermined price or by valuing the shares according to a predetermined formula. 2. Stock Redemption Agreement: This agreement allows the corporation to buy back the shares of a departing shareholder. The corporation does so by using its own funds or through financing arrangements. In this case, the remaining shareholders maintain ownership of the corporation by increasing their proportionate ownership. 3. Hybrid Agreement: A hybrid agreement combines elements of both cross-purchase and stock redemption agreements. It allows both the corporation and the remaining shareholders to participate in the purchase of shares. This type of agreement provides flexibility, as the shareholders can choose whether the corporation or individual shareholders will buy the departing shareholder's shares. Regardless of the type, a Nebraska Buy Sell Agreement typically includes important provisions such as: — Purchase Price: The agreement should clearly state the method for determining the purchase price, whether it's a fixed price, formula-based, or independently appraised value. In some cases, a funding mechanism like life insurance or installment payments may be specified. — Triggering Events: The agreement should specify the events that will trigger the buyout, such as death, disability, retirement, bankruptcy, divorce, or voluntary departure. Clear definitions and provisions related to each triggering event should be included. — Right of First Refusal: This provision gives existing shareholders the right to purchase the departing shareholder's shares before they can be sold to a third party. It ensures the shares remain within the corporation's existing ownership structure. — Transfer Restrictions: The agreement may include restrictions on the transfer of shares, requiring shareholders to obtain consent from other shareholders or the corporation before selling or transferring their shares. — Dispute Resolution: It is important to include provisions for dispute resolution, such as mediation or arbitration, to resolve any conflicts that may arise during the buyout process. Overall, a Nebraska Buy Sell Agreement Between Shareholders and a Corporation is a crucial legal document that protects the interests of all parties involved in the sale or transfer of shares. It provides a clear roadmap and mechanisms for handling ownership transitions within a corporation and helps ensure a smooth and fair process.

A Nebraska Buy Sell Agreement Between Shareholders and a Corporation is a legally binding contract that outlines the terms and conditions for the sale or transfer of shares between a corporation and its shareholders. This agreement is specific to the state of Nebraska and is commonly used to provide a clear mechanism for buying or selling shares in a closely held corporation. There are several types of Nebraska Buy Sell Agreements, including the following: 1. Cross-Purchase Agreement: In this type of agreement, the shareholders of a corporation agree to buy each other's shares in the event of certain triggering events like death, disability, retirement, or voluntary departure. Each shareholder agrees to purchase the shares of the departing shareholder at a predetermined price or by valuing the shares according to a predetermined formula. 2. Stock Redemption Agreement: This agreement allows the corporation to buy back the shares of a departing shareholder. The corporation does so by using its own funds or through financing arrangements. In this case, the remaining shareholders maintain ownership of the corporation by increasing their proportionate ownership. 3. Hybrid Agreement: A hybrid agreement combines elements of both cross-purchase and stock redemption agreements. It allows both the corporation and the remaining shareholders to participate in the purchase of shares. This type of agreement provides flexibility, as the shareholders can choose whether the corporation or individual shareholders will buy the departing shareholder's shares. Regardless of the type, a Nebraska Buy Sell Agreement typically includes important provisions such as: — Purchase Price: The agreement should clearly state the method for determining the purchase price, whether it's a fixed price, formula-based, or independently appraised value. In some cases, a funding mechanism like life insurance or installment payments may be specified. — Triggering Events: The agreement should specify the events that will trigger the buyout, such as death, disability, retirement, bankruptcy, divorce, or voluntary departure. Clear definitions and provisions related to each triggering event should be included. — Right of First Refusal: This provision gives existing shareholders the right to purchase the departing shareholder's shares before they can be sold to a third party. It ensures the shares remain within the corporation's existing ownership structure. — Transfer Restrictions: The agreement may include restrictions on the transfer of shares, requiring shareholders to obtain consent from other shareholders or the corporation before selling or transferring their shares. — Dispute Resolution: It is important to include provisions for dispute resolution, such as mediation or arbitration, to resolve any conflicts that may arise during the buyout process. Overall, a Nebraska Buy Sell Agreement Between Shareholders and a Corporation is a crucial legal document that protects the interests of all parties involved in the sale or transfer of shares. It provides a clear roadmap and mechanisms for handling ownership transitions within a corporation and helps ensure a smooth and fair process.

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