Hennepin Minnesota Shareholders' Agreement between Two Shareholders of Closely Held Corporation with Buy Sell Provisions

• Category: Corporations - Shareholders and Stock
• State: Multi-State
• County: Hennepin
• Control #: US-02569BG
• 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. Hennepin Minnesota Shareholders' Agreement is a legally binding document that outlines the rights and responsibilities of two shareholders in a closely held corporation, with specific provisions related to buy-sell agreements. This agreement serves as a framework to govern the relationship between the shareholders, ensuring a fair and smooth operation of the corporation. The Hennepin Minnesota Shareholders' Agreement includes various clauses and provisions that protect the interests of the shareholders and provide mechanisms for resolving disputes. One important aspect of this agreement is the buy-sell provision, which dictates how shares are bought or sold in certain situations, such as when a shareholder wants to leave the corporation or in the event of death or disability. There are several types of Hennepin Minnesota Shareholders' Agreements with buy-sell provisions, namely: 1. Cross-Purchase Agreement: This type of agreement allows the remaining shareholder(s) to purchase the shares of a departing shareholder. In the event of death or disability, the purchase price may be determined beforehand or based on a valuation formula outlined in the agreement. 2. Redemption Agreement: In this type of agreement, the corporation itself buys back the shares of a departing shareholder. The purchase price may be determined based on a pre-defined formula or through a valuation process. 3. Hybrid Agreement: A hybrid agreement combines both the cross-purchase and redemption methods. It allows the remaining shareholder(s) and the corporation to share the responsibility of purchasing the shares, depending on the specific circumstances outlined in the agreement. The Hennepin Minnesota Shareholders' Agreement also typically addresses other important issues, such as the allocation of voting rights, decision-making processes, restrictions on share transfers, provisions for minority shareholders, and mechanisms for resolving disputes, among others. It is crucial for shareholders to seek legal advice when drafting a Hennepin Minnesota Shareholders' Agreement with buy-sell provisions to ensure that all relevant state laws and regulations are adhered to and that the agreement meets the specific needs and objectives of the shareholders and the corporation.

Hennepin Minnesota Shareholders' Agreement is a legally binding document that outlines the rights and responsibilities of two shareholders in a closely held corporation, with specific provisions related to buy-sell agreements. This agreement serves as a framework to govern the relationship between the shareholders, ensuring a fair and smooth operation of the corporation. The Hennepin Minnesota Shareholders' Agreement includes various clauses and provisions that protect the interests of the shareholders and provide mechanisms for resolving disputes. One important aspect of this agreement is the buy-sell provision, which dictates how shares are bought or sold in certain situations, such as when a shareholder wants to leave the corporation or in the event of death or disability. There are several types of Hennepin Minnesota Shareholders' Agreements with buy-sell provisions, namely: 1. Cross-Purchase Agreement: This type of agreement allows the remaining shareholder(s) to purchase the shares of a departing shareholder. In the event of death or disability, the purchase price may be determined beforehand or based on a valuation formula outlined in the agreement. 2. Redemption Agreement: In this type of agreement, the corporation itself buys back the shares of a departing shareholder. The purchase price may be determined based on a pre-defined formula or through a valuation process. 3. Hybrid Agreement: A hybrid agreement combines both the cross-purchase and redemption methods. It allows the remaining shareholder(s) and the corporation to share the responsibility of purchasing the shares, depending on the specific circumstances outlined in the agreement. The Hennepin Minnesota Shareholders' Agreement also typically addresses other important issues, such as the allocation of voting rights, decision-making processes, restrictions on share transfers, provisions for minority shareholders, and mechanisms for resolving disputes, among others. It is crucial for shareholders to seek legal advice when drafting a Hennepin Minnesota Shareholders' Agreement with buy-sell provisions to ensure that all relevant state laws and regulations are adhered to and that the agreement meets the specific needs and objectives of the shareholders and the corporation.