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Form #1392

COMPLEX SHAREHOLDER AGREEMENT WITH CERTIFICATE OF AGREED VALUE

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COMPLEX SHAREHOLDER AGREEMENT WITH CERTIFICATE OF AGREED VALUE


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COMPLEX SHAREHOLDER AGREEMENT WITH CERTIFICATE OF AGREED VALUE

 

STATE OF __________________

COUNTY OF ________________

 

SHAREHOLDER AGREEMENT

 

THIS AGREEMENT is made and entered into this _____ day of ______________, by and between ________________________________________ (Name of Corporation), a ____________________________ Corporation, whose principal offices are located at ______________________________________________ (address), and the individuals and entities whose names and addresses are listed on Exhibit A attached hereto and made a part hereof, all of whom are shareholders of the Corporation. 

 

W I T N E S S E T H:

 

WHEREAS, the present distribution of shares of the Corporation is as follows:

Name                                                                                    Shares

_____________________________________                   _____________

_____________________________________                   _____________

_____________________________________                   _____________

 

WHEREAS, the parties have agreed that to promote the good conduct of the Corporation and avoid the difficulties that might result from the passing of shares to outsiders, it is desirable to make this Agreement concerning the conduct of the Corporation and restrictions upon the transfer of its shares;

 

NOW, THEREFORE, in consideration of the promises herein made to one another, and for other good and valuable consideration, the receipt and sufficiency of which is

hereby acknowledged, the parties agree as follows:

 

1.  No shares shall be voluntarily sold, pledged, hypothecated, or otherwise transferred or permitted to be transferred in any manner or by any means whatsoever except as follows:

 

Any shareholder intending to transfer any shares shall first offer such shares for sale at the Purchase Value as hereinafter defined to the Corporation for a period of thirty (30) days, and then, to the extent such offer is rejected or not accepted by the Corporation within that period, such shares have been offered for sale at the Purchase Value for a period of ten (10) days to all other shareholders in proportion to the number of such shares held by them.  Each such offer shall be in writing and shall specify the number of shares being offered, the name and address of each person to whom such shares are proposed to be transferred, and the price per share and other terms upon which each such transfer is intended to be made; and each such offer may be accepted by the offeree in whole or in part at any time during the continuance of the offer.  If any shares are not purchased pursuant to the aforesaid offers, the Offeror shall for a period of ninety (90) days thereafter be free to transfer such shares to the person or person so named at the price per share and upon the other terms so named; provided that any such transferee of those shares shall thereafter be bound by all of the provisions of this Agreement. 

 

2.  (a)  Upon the happening of any of the events enumerated below, the Corporation shall purchase at Purchase Value as hereinafter defined all of the shares of the shareholder so affected: (i) If any shareholder shall be adjudged incompetent or a general guardian or guardian of his estate shall be appointed for him by any court; or (ii) If any shareholder makes any assignment for the benefit of creditors or applies for the appointment of a trustee, a liquidator, or a receiver, or commences any proceeding related to himself under any bankruptcy or arrangement of similar law; or if any such application is filed or proceedings commenced against the shareholder and the shareholder consents thereto or an order is entered allowing such application and remains in effect for sixty (60) days; or (iii) If the shares of any shareholder are purported to be transferred involuntarily, including, without limitation, any purported transfer by or pursuant to bankruptcy,

attachment, divorce, equitable distribution, or operation of law; or (iv) If any shareholder shall die.

 

(b)  This duty to purchase or retire shall apply to all, but not less than all of the shares, and shall be exercised by the Corporation by serving written notice upon such shareholder or such shareholder's legal representative within thirty (30) days after the Corporation receives notice of the occurrence of such event or the qualification of such legal representative, whichever is later.

 

3.  (a)  Purchase Value as used herein shall mean the Purchase Value of the shares of the Corporation established by a certificate of agreed value signed by each shareholder and filed with the Corporation.  If, at any time when it becomes necessary to determine Purchase Value of the shares of the Corporation, a certificate of agreed value is in existence and such certificate of agreed value is dated less than two (2) years before the date as of which the Purchase Value is to be determined, then the agreed value set forth in such certificate shall be conclusive as to the Purchase Value and shall be accepted as the Purchase Value as of the date on which Purchase Value is to be determined, and no accountant's determination of book value shall be required or made.  In no event shall a certificate of agreed value be effective unless signed by all the shareholders.  The shareholders may at any time execute a new certificate of agreed value which shall automatically replace all prior certificates of agreed value and in no event shall any but the last certificate of agreed value be effective, if at all, for the purpose herein specified.

 

(b)  In the event there is no certificate of agreed value or in the event the same is more than two (2) years old, then, and in that event, Purchase Value shall mean book value of the shares of the Corporation.

Book value of the shares of the Corporation shall mean as determined by the accountant or accounting firm then servicing the Corporation, and such determination when made, certified, and delivered to the Corporation shall be binding upon the Corporation and upon all parties bound by the terms of the Agreement.  Such determination shall be made in accordance with sound accounting practice and the following shall be observed: (i) No

allowance of any kind shall be made for goodwill, trade name, or any similar intangible asset. (ii) All accounts payable shall be taken at the face amount, less discounts deductible therefrom, and all accounts receivable shall be taken at the face amount thereof, less discounts to the customers and a reasonable reserve for bad debts. (iii) All machinery, fixtures, and equipment shall be taken at the valuation appearing on the books of the Corporation. (iv) Inventory of merchandise and supplies shall be computed at cost or market value, whichever is lower. (v) All unpaid and accrued taxes shall be deducted as liabilities.

 

4.  (a)  Whenever under this Agreement the Corporation or the shareholders exercise any option or right to redeem or purchase shares of any shareholder, the Purchase Value shall be paid  immediately upon the receipt by the Corporation of the proceeds of any insurance on the life of a deceased shareholder owned by and payable to the Corporation, to the extent of such proceeds. 

 

(b)  Whenever under this Agreement the Corporation or the shareholders exercise any option or right to redeem or purchase shares of any shareholder, the Purchase Value shall be paid to the shareholder in cash, ________ percent within thirty (30) days of the exercise of any such right or option and the balance in installments as follows: ______________________________________________________________

 

5.  (a)  If, under the terms of this Agreement, the shares of the shareholders are purchased or retired, such shareholder, or the legal representative of such shareholder, shall execute and deliver all necessary documents that may be reasonably required for accomplishing a complete transfer of such shares for the purpose of the purchase

 transaction.

 

(b)  Every transferee of restricted shares that are transferred in accordance with the provisions of this Agreement shall be deemed a shareholder and be bound by all of the provisions of this Agreement.  Any purported or attempted transfer of restricted shares that does not comply with the provisions of this Agreement shall be null and void and the

purported transferee shall not be deemed to be a shareholder of the Corporation and shall not be entitled to receive a stock certificate or any dividends or other distributions on or with respect to such restricted shares.  For the purposes of this Agreement, a purported transfer of shares that causes such shares to be subject to an option under Paragraph 1 shall be deemed to comply with the provisions of this Agreement only after the expiration of such option. 

 

6.  The provisions of Paragraph 1 shall not apply to the bona fide, good faith pledge of any shares as collateral for a loan, but the provisions of Paragraph 1 shall apply to any attempted sale or other disposition of shares under any such pledge (whether by foreclosure, consent, public or private sale, or otherwise). 

 

7.  This Agreement shall terminate and all rights and obligations hereunder shall cease upon the happening of any one of the following events:

 

(a)  The adjudication of the Corporation as bankrupt, the execution by it of any assignment for the benefit of creditors, or the appointment of a receiver for the Corporation;

 

(b)  The voluntary or involuntary dissolution of the Corporation;

 

(c)  By a written Agreement signed by all the shareholders to terminate this Agreement.

 

8.      If the Corporation reasonably determines that any proposed transferee is not

eligible as a shareholder of a Subchapter S Corporation or that such transfer would cause the Corporation to lose its qualification as a Subchapter S Corporation, then the Corporation may so notify the shareholder of that determination and thereby forbid the consummation of the transfer.  Nothing in this paragraph, however, shall preclude the Corporation's and the shareholders' rights of refusal under this Agreement.

 

9.  The certificates for shares subject hereto shall be surrendered to the Corporation and endorsed as follows:

 

"The shares represented by this certificate are subject to and are transferable only on compliance with a Shareholders Agreement dated the ____ day of ________________, among shareholders, a copy of which is on file in the office of the Secretary of the Corporation."

 

10.  Whenever under this Agreement notice is required to be given, it shall be given in writing served in person or by registered mail, return receipt requested, and it shall be deemed to have been given upon personal delivery or on the date notice is posted.

 

11.  This Agreement embodies the entire representations, Agreements and conditions in relation to the subject matter hereof and no representations, understandings or Agreements, oral or otherwise, in relation thereto exist between the parties except as herein expressly set forth.  The Agreement may not be amended or terminated orally but only as expressly provided herein or by an instrument in writing duly executed by the parties hereto.

 

12.  This Agreement and the various rights and obligations arising hereunder shall inure only to the benefit of and be binding upon the parties hereto and their respective heirs, successors and assigns.

 

13.  The invalidity or unenforceability of any term or provision of this Agreement or

the non-application of such term or provision to any person or circumstance shall not impair or affect the remainder of this Agreement, and its application to other persons and circumstances and the remaining terms and provisions hereof shall not be invalidated but shall remain in full force and effect. 

 

14.  Whenever in this Agreement any pronoun is used in reference to any shareholder, purchaser or other person or entity, natural or otherwise, the singular shall include the plural, and the masculine shall include the feminine or the neuter, as required by context. 

 

15.  This Agreement shall be governed by and construed in accordance with the laws of the State of _________________.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement the date and place first above mentioned.

 

____________________________________ (Name of Corporation

 

By:    _______________________________

 

____________________________________ President

 

____________________________________ (SEAL)

 

____________________________________ Shareholder

 

____________________________________ (SEAL)

 

____________________________________ Shareholder

 

Contributed by
King and Spelling LLC
 
Total Forms Contributed 117
 

See All King and Spelling LLC's Forms
 

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Terms Of Use

Submissions to this site, including any legal or business forms, posts, responses to questions or other communications by contributors are not intended as and should not be construed as legal advice. You are strongly encouraged to consult competent legal council before engaging in any action based upon content contained on this site.

These downloadable forms are only for personal use. Retransmission, redistribution, or any other commercial use is prohibited. This includes reposting forms from this site to another site offering free legal or other document forms for download.

Please note that the donator may have included different usage terms regarding this form, and you agree to abide by these terms. It is highly recommended that you have a licensed attorney review any legal documents for which you are searching in order to make sure that your needs are being properly and completely satisfied.

Your use of this site constitutes your acceptance of our terms of use and your agreement to hold this site, its officers, employees and any contributors to this site harmless for any damage you might incur from your use of any submissions contained on this site. If you do not agree to the above terms, please do not proceed.

These forms are provided to assist business owners and others in understanding important points to consider in different transactions. They are offered with the understanding that no legal advice, accounting, or other professional service is being offered by these documents or on this website. Laws vary in the different states. Agreements acceptable in one state may not be enforced the same way under the laws of another state. Also, agreements should relate specifically to the particular facts of each situation. Therefore, it is important to consult legal counsel whenever utilizing these forms. The Forms are not a substitute for legal advice YourFreeLegalForms.com is not engaged in recommending or referring members on the site or making claims about the competence, character or qualifications of its participating members.
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