Oregon 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. Oregon 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 In the state of Oregon, a Shareholders' Agreement with a Buy-Sell Agreement plays a crucial role in corporate governance and the transfer of shares upon the death of a shareholder. This specific type of agreement grants the corporation the first right of refusal to purchase the shares of a deceased shareholder if the beneficiaries of the deceased shareholder choose to sell those shares. Here is a detailed description of this agreement along with some potential types that can be found in Oregon. 1. Oregon Shareholders' Agreement with Buy-Sell Agreement: This agreement outlines the rights and obligations of shareholders within a corporation, particularly when it comes to the transfer of ownership in the event of a shareholder's death. The Buy-Sell Agreement clause within this agreement ensures that the corporation has the first opportunity to purchase the shares of a deceased shareholder before they are sold to any external party. 2. First Right of Refusal: The inclusion of the first right of refusal provision in the Oregon Shareholders' Agreement allows the corporation to safeguard its interests and maintain control over its ownership structure. It grants the corporation the primary option to buy the shares of a deceased shareholder before they are offered to others. 3. Buy-Sell Agreement: The Buy-Sell Agreement, as a part of the overall Shareholders' Agreement, sets forth the terms and conditions for the transfer of shares upon the death of a shareholder. It ensures a smooth transition of ownership while protecting the interests of all involved parties. 4. Beneficiaries of the Deceased Shareholder: The beneficiaries of a deceased shareholder are the individuals or entities who inherit the shares of the deceased after their passing. They are the legal recipients of the shares and have the right to sell or transfer them to others. However, in the presence of the Buy-Sell Agreement, their desire to sell the shares triggers the corporation's first right of refusal. Types of Oregon Shareholders' Agreement with Buy-Sell Agreement: 1. Mandatory Buy-Sell Agreement: This type of agreement makes it mandatory for the shareholders to enter into the Buy-Sell Agreement, leaving no room for negotiation or voluntary opt-outs. It ensures that all shareholders are bound by the provisions of the agreement, including the first right of refusal for the corporation. 2. Permissive Buy-Sell Agreement: In a permissive Buy-Sell Agreement, shareholders have the choice to opt into the agreement voluntarily. It allows flexibility and gives shareholders the opportunity to negotiate specific terms related to the first right of refusal, price determination, and other relevant clauses. 3. Cross-Purchase Buy-Sell Agreement: A cross-purchase Buy-Sell Agreement involves shareholders within the corporation taking the responsibility of purchasing the shares of a deceased shareholder, rather than the corporation itself. This type of agreement can be beneficial when there are only a few shareholders, and they are amenable to buying shares from each other. 4. Entity Redemption Buy-Sell Agreement: In an entity redemption Buy-Sell Agreement, the corporation itself is responsible for buying back the shares of a deceased shareholder. This type of agreement is useful in larger corporations with numerous shareholders, where individual purchases might not be practical. In conclusion, the Oregon Shareholders' Agreement with a Buy-Sell Agreement that allows the corporation the first right of refusal to purchase the shares of a deceased shareholder offers a structured framework for the transfer of ownership. Different types of this agreement, such as the mandatory, permissive, cross-purchase, and entity redemption options, cater to various circumstances and preferences among shareholders.

Oregon 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 In the state of Oregon, a Shareholders' Agreement with a Buy-Sell Agreement plays a crucial role in corporate governance and the transfer of shares upon the death of a shareholder. This specific type of agreement grants the corporation the first right of refusal to purchase the shares of a deceased shareholder if the beneficiaries of the deceased shareholder choose to sell those shares. Here is a detailed description of this agreement along with some potential types that can be found in Oregon. 1. Oregon Shareholders' Agreement with Buy-Sell Agreement: This agreement outlines the rights and obligations of shareholders within a corporation, particularly when it comes to the transfer of ownership in the event of a shareholder's death. The Buy-Sell Agreement clause within this agreement ensures that the corporation has the first opportunity to purchase the shares of a deceased shareholder before they are sold to any external party. 2. First Right of Refusal: The inclusion of the first right of refusal provision in the Oregon Shareholders' Agreement allows the corporation to safeguard its interests and maintain control over its ownership structure. It grants the corporation the primary option to buy the shares of a deceased shareholder before they are offered to others. 3. Buy-Sell Agreement: The Buy-Sell Agreement, as a part of the overall Shareholders' Agreement, sets forth the terms and conditions for the transfer of shares upon the death of a shareholder. It ensures a smooth transition of ownership while protecting the interests of all involved parties. 4. Beneficiaries of the Deceased Shareholder: The beneficiaries of a deceased shareholder are the individuals or entities who inherit the shares of the deceased after their passing. They are the legal recipients of the shares and have the right to sell or transfer them to others. However, in the presence of the Buy-Sell Agreement, their desire to sell the shares triggers the corporation's first right of refusal. Types of Oregon Shareholders' Agreement with Buy-Sell Agreement: 1. Mandatory Buy-Sell Agreement: This type of agreement makes it mandatory for the shareholders to enter into the Buy-Sell Agreement, leaving no room for negotiation or voluntary opt-outs. It ensures that all shareholders are bound by the provisions of the agreement, including the first right of refusal for the corporation. 2. Permissive Buy-Sell Agreement: In a permissive Buy-Sell Agreement, shareholders have the choice to opt into the agreement voluntarily. It allows flexibility and gives shareholders the opportunity to negotiate specific terms related to the first right of refusal, price determination, and other relevant clauses. 3. Cross-Purchase Buy-Sell Agreement: A cross-purchase Buy-Sell Agreement involves shareholders within the corporation taking the responsibility of purchasing the shares of a deceased shareholder, rather than the corporation itself. This type of agreement can be beneficial when there are only a few shareholders, and they are amenable to buying shares from each other. 4. Entity Redemption Buy-Sell Agreement: In an entity redemption Buy-Sell Agreement, the corporation itself is responsible for buying back the shares of a deceased shareholder. This type of agreement is useful in larger corporations with numerous shareholders, where individual purchases might not be practical. In conclusion, the Oregon Shareholders' Agreement with a Buy-Sell Agreement that allows the corporation the first right of refusal to purchase the shares of a deceased shareholder offers a structured framework for the transfer of ownership. Different types of this agreement, such as the mandatory, permissive, cross-purchase, and entity redemption options, cater to various circumstances and preferences among shareholders.