Nebraska Shareholders' Agreement with Buy-Sell Agreement Allowing Corporation the First Right of Refusal to Purchase the Shares of Deceased Shareholder should the Beneficiaries of the Deceased Shareholder Desire to Sell such Shares

• Category: Corporations - Shareholders and Stock
• State: Multi-State
• Control #: US-02629BG
• Format: Word; Rich Text

Description

A corporation whose shares are held by a single shareholder or a closely-knit group of shareholders (such as a family) is known as a close corporation. The shares of stock are not traded publicly. Many of these types of corporations are small firms that in the past would have been operated as a sole proprietorship or partnership, but have been incorporated in order to obtain the advantages of limited liability or a tax benefit or both. 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 Nebraska Shareholders' Agreement with a Buy-Sell Agreement Allowing the Corporation the First Right of Refusal to Purchase the Shares of a Deceased Shareholder is a legal arrangement that outlines the terms and conditions for the transfer of shares in a corporation upon the death of a shareholder. This agreement provides the corporation with the first opportunity to purchase the shares instead of allowing the beneficiaries of the deceased shareholder to sell them to a third party. When a shareholder passes away, their shares become part of their estate and are typically distributed to their beneficiaries according to their will or applicable laws of intestate succession. However, in cases where a Nebraska Shareholders' Agreement with a Buy-Sell Agreement is in place, the beneficiaries must offer the shares to the corporation before considering any other potential buyers. This type of agreement can be categorized into different versions, including: 1. Mandatory Buy-Sell Agreement: This version mandates that the beneficiaries of a deceased shareholder must sell their shares to the corporation if the corporation exercises its first right of refusal. The agreement sets the valuation method for determining the purchase price of the shares, ensuring a fair and equitable transaction. 2. Optional Buy-Sell Agreement: In this variation, the corporation has the option to exercise its first right of refusal. The beneficiaries of the deceased shareholder are free to explore other potential buyers if the corporation declines the opportunity to purchase the shares. 3. Shotgun Buy-Sell Agreement: This unique type of agreement allows either the corporation or the beneficiaries of the deceased shareholder to trigger the sale process. One party proposes a price at which they are willing to either buy or sell the shares. The other party is then given the choice to either buy the shares at that proposed price or sell their shares to the proposing party at the same price. The main purpose of these Nebraska Shareholders' Agreements with Buy-Sell Agreement clauses is to ensure a smooth transition of ownership and protect the corporation from unwanted shareholders. By granting the corporation the first right of refusal, it allows the remaining shareholders or the entity itself to maintain control over the ownership structure and avoid potential conflicts that may arise from having unknown or unqualified shareholders. In conclusion, a Nebraska Shareholders' Agreement with a Buy-Sell Agreement Allowing the Corporation the First Right of Refusal to Purchase the Shares of a Deceased Shareholder is a vital legal document that outlines the procedures for the transfer of shares upon the death of a shareholder. The specific type of agreement can vary, including mandatory, optional, or shotgun variations, depending on the specific intentions and needs of the shareholders and the corporation involved.

A Nebraska Shareholders' Agreement with a Buy-Sell Agreement Allowing the Corporation the First Right of Refusal to Purchase the Shares of a Deceased Shareholder is a legal arrangement that outlines the terms and conditions for the transfer of shares in a corporation upon the death of a shareholder. This agreement provides the corporation with the first opportunity to purchase the shares instead of allowing the beneficiaries of the deceased shareholder to sell them to a third party. When a shareholder passes away, their shares become part of their estate and are typically distributed to their beneficiaries according to their will or applicable laws of intestate succession. However, in cases where a Nebraska Shareholders' Agreement with a Buy-Sell Agreement is in place, the beneficiaries must offer the shares to the corporation before considering any other potential buyers. This type of agreement can be categorized into different versions, including: 1. Mandatory Buy-Sell Agreement: This version mandates that the beneficiaries of a deceased shareholder must sell their shares to the corporation if the corporation exercises its first right of refusal. The agreement sets the valuation method for determining the purchase price of the shares, ensuring a fair and equitable transaction. 2. Optional Buy-Sell Agreement: In this variation, the corporation has the option to exercise its first right of refusal. The beneficiaries of the deceased shareholder are free to explore other potential buyers if the corporation declines the opportunity to purchase the shares. 3. Shotgun Buy-Sell Agreement: This unique type of agreement allows either the corporation or the beneficiaries of the deceased shareholder to trigger the sale process. One party proposes a price at which they are willing to either buy or sell the shares. The other party is then given the choice to either buy the shares at that proposed price or sell their shares to the proposing party at the same price. The main purpose of these Nebraska Shareholders' Agreements with Buy-Sell Agreement clauses is to ensure a smooth transition of ownership and protect the corporation from unwanted shareholders. By granting the corporation the first right of refusal, it allows the remaining shareholders or the entity itself to maintain control over the ownership structure and avoid potential conflicts that may arise from having unknown or unqualified shareholders. In conclusion, a Nebraska Shareholders' Agreement with a Buy-Sell Agreement Allowing the Corporation the First Right of Refusal to Purchase the Shares of a Deceased Shareholder is a vital legal document that outlines the procedures for the transfer of shares upon the death of a shareholder. The specific type of agreement can vary, including mandatory, optional, or shotgun variations, depending on the specific intentions and needs of the shareholders and the corporation involved.