Ohio 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. Ohio 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 provides a legal framework for managing the shares of a deceased shareholder in a corporation. This agreement grants the corporation the first opportunity to purchase the shares should the beneficiaries of the deceased shareholder wish to sell them. In such a situation, the shareholders' agreement outlines the specific terms and conditions under which the corporation can exercise its right of refusal. It ensures that the corporation has the opportunity to maintain control and ownership within the company by allowing it to repurchase the shares before they are sold to an external party. This type of shareholders' agreement typically includes various provisions to protect the interests of both the corporation and the beneficiaries. These provisions may include: 1. Right of First Refusal: This clause grants the corporation the exclusive right to purchase the shares of the deceased shareholder before they are offered to any third party. It ensures that the corporation has the opportunity to maintain its ownership structure. 2. Valuation of Shares: The agreement outlines a mechanism for determining the value of the deceased shareholder's shares. This can be based on a pre-determined formula, independent appraisal, or agreed-upon valuation methodology. 3. Notice and Offer: The agreement specifies how the beneficiaries must notify the corporation of their desire to sell the shares. It sets a time period within which the corporation has to accept or decline the offer to purchase the shares. 4. Financing the Purchase: In case the corporation decides to exercise its right of refusal, the agreement may include provisions on how the purchase price will be financed. This can involve a combination of cash payments, installment payments, or loans. 5. Share Purchase Agreement: If the corporation decides to purchase the shares, a separate share purchase agreement is typically executed, outlining the terms of the sale, payment schedule, and any other necessary provisions. It's important to note that variations of this type of Ohio shareholders' agreement may exist, tailored to specific situations and the preferences of the corporation and shareholders involved. Having a comprehensive Ohio 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 is essential for ensuring a smooth transition of ownership and protecting the interests of all parties involved.

Ohio 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 provides a legal framework for managing the shares of a deceased shareholder in a corporation. This agreement grants the corporation the first opportunity to purchase the shares should the beneficiaries of the deceased shareholder wish to sell them. In such a situation, the shareholders' agreement outlines the specific terms and conditions under which the corporation can exercise its right of refusal. It ensures that the corporation has the opportunity to maintain control and ownership within the company by allowing it to repurchase the shares before they are sold to an external party. This type of shareholders' agreement typically includes various provisions to protect the interests of both the corporation and the beneficiaries. These provisions may include: 1. Right of First Refusal: This clause grants the corporation the exclusive right to purchase the shares of the deceased shareholder before they are offered to any third party. It ensures that the corporation has the opportunity to maintain its ownership structure. 2. Valuation of Shares: The agreement outlines a mechanism for determining the value of the deceased shareholder's shares. This can be based on a pre-determined formula, independent appraisal, or agreed-upon valuation methodology. 3. Notice and Offer: The agreement specifies how the beneficiaries must notify the corporation of their desire to sell the shares. It sets a time period within which the corporation has to accept or decline the offer to purchase the shares. 4. Financing the Purchase: In case the corporation decides to exercise its right of refusal, the agreement may include provisions on how the purchase price will be financed. This can involve a combination of cash payments, installment payments, or loans. 5. Share Purchase Agreement: If the corporation decides to purchase the shares, a separate share purchase agreement is typically executed, outlining the terms of the sale, payment schedule, and any other necessary provisions. It's important to note that variations of this type of Ohio shareholders' agreement may exist, tailored to specific situations and the preferences of the corporation and shareholders involved. Having a comprehensive Ohio 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 is essential for ensuring a smooth transition of ownership and protecting the interests of all parties involved.