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AGREEMENT made this _____________ day of ______________, (year)____, between ____________________ Inc., having its principal office at ______________________________ ______________________________, and _________________________, whose address is _____________________________________________, and _________________________ whose address is __________________________________________________, and _________________________ whose address is _______________________________________.
Whereas, the above signed parties wish to promote the Corporation's interests and secure their own interests by making provision to avoid future differences. It is therefore mutually agreed that:
1. As long as each of the undersigned shareholders remains a shareholder in ______________________________ Corporation, he or she will vote his or her respective shares of stock in the corporation for each of the following named directors.
Any of the above directors who cease to be a shareholder in the Corporation shall submit his or her resignation to the Corporation when he or she transfers his or her shares.
2. Each of the undersigned parties agree that he or she shall will devote his or her best efforts to the best interests and advancement of the corporation.
3. For the common interest of the Corporation, the undersigned shareholders agree to the following people appointed and elected as officers of the Corporation, as long as they remain shareholders of the Corporation and perform competently, faithfully, and efficiently.
_________________________________________, Vice President
Any of the foregoing officers who ceases to be a shareholder in the Corporation shall submit his or her resignation to the corporation when he or she transfers his or her shares.
4(a). The undersigned shareholders agree any action taken at a meeting of the shareholders that receives a vote in favor of less than ________% of the shareholders may be subject to action from the dissenting shareholders. They may require the other shareholders to either (1) Rescind the action or (2) Purchase the shares of the corporation owned by the dissenter(s) at a price per share computed on a pro rata basis according to Section 4(d) of this agreement within _______ days. The below undersigned shareholders agree that should their vote in favor of the action be dissented from, they will either (1) Rescind it, or (2) Purchase the dissenter's shares computed on a pro rata basis according to Section 4(d) of this agreement within _______ days.
4(b). The undersigned shareholders agree that they will not sell, pledge, assign, transfer, hypothecate, or otherwise dispose of the shares of stock owned by any of them, unless the shares of stock have been first offered to the corporation at a price computed on a pro rata basis according to Section 4(d) of this agreement. Any such offer shall be made in writing and shall remain open for the acceptance of the corporation for a period of no less than ______ days. Should the corporation accept the offer, it must agree in writing to purchase the entire amount of stock offered and shall make a down payment comprised of ______% of the total purchase price. The remaining balance of the total purchase price shall be paid as provided for in Section 4(e) of this agreement. If the Corporation should choose not to purchase the shares within _______ days, the shares shall be offered to the remaining shareholders on the same pro rata basis as provided for in Section 4(d) of this agreement. Any such offer shall be shall remain open for a period of ______ days and shall be made in writing. In the event the remaining shareholders wish to accept the offer, they must agree in writing to purchase any or all of their pro rata portion of shares, and make a down payment comprised of _______% of the total purchase price. The balance of the total purchase price shall be paid as provided in Section 4(e) of this agreement. If any shareholder should elect not to purchase his or her portion of the shares, or should elect to purchase less than the full amount, the remainder shall be offered to the other shareholders on the same pro rata basis as outlined in Section 4(d) of this agreement. After this offering to the remaining shareholders, any amount of stock that remains unpurchased shall be considered freely transferable and no longer subject to the provisions and limitations of this agreement. This agreement shall not bar a sale, transfer, assignment, or bequest shares of stock by one of the undersigned shareholders to a member of his or her immediate family, who shall, however, take his or her stock subject to all the provisions and limitations of this agreement.
4(c). The parties to this agreement agree that upon the death of ___________________, ________________________________, or ________________________________, the executors, administrators, or other such legal representatives of the deceased shall, within ________ days, offer to sell to the Corporation all the shares of stock owned by the deceased at the time of his or her death. It is the wish of the parties to this agreement that after the qualification of the legal representatives of the deceased shareholder, his or her family shall terminate any and all interest in the Corporation and that any and all members of the family to whom the deceased has left shares of stock shall sell to the Corporation all shares of stock owned by them within a period of _______ days. The price per share shall be computed on a pro rata basis according to the provisions of Section 4(d) of this agreement.
4(d). The undersigned parties agree that as of this date one share of stock in the corporation is worth $__________. It is the intention of the parties to review this figure ________ times per year, and that the last agreed-upon figure prior to a such transfer as described in Sections 4(a), (b), or (c) shall be binding and conclusive determination as to the value of the stock for such purposes. (e) The purchase price shall be paid as follows: ______% in cash within ________ days after the qualification of the legal representatives of the deceased shareholder. _______% of the unpaid balance shall be paid within the succeeding _________ days, and ______% of the still remaining unpaid balance within ______ days. Interest at the rate of ______% shall be calculated on the outstanding unpaid balance. The Corporation reserves the right to prepay the whole or any part of the amount owed without the imposition of a premium or penalty therefore.
5. The parties hereto agree that they will not dispose of their shares of stock in such a way as to cause the termination of the Corporation's ability to be taxed as an electing Small Business Corporation under Subchapter S of the Internal Revenue Code of 1954.
6. Each certificate of stock of the Corporation shall contain the following information: Transfer or pledge of these shares is restricted under a shareholders' agreement dated ________________, (year)____.
A copy of the agreement, which affects other rights of the holder of these shares, will be kept on file at the office of the Corporation at _________________________________.
7. Should any dispute arise between two or more of the parties to this agreement as to their rights under any provisions of this agreement, the parties hereby agree to refer such dispute to the American Arbitration Association, whose decision on the questions shall be binding on the parties and shall be without appeal.
8. The Corporation is authorized to enter into this agreement by a resolution adopted by the shareholders and directors, dated _____________________________, (year)_____.
9. This agreement or any of its provisions may be changed only by the mutual consent of the undersigned parties, and unless so changed it remains binding upon all the parties, their heirs, executors, administrators, legal representatives, and assigns, who shall execute and deliver all necessary documents required to carry out the terms of this agreement.
In witness thereof, the individual parties hereto set their hands and seals, and the Corporation has caused this agreement to be signed by its duly authorized officers and the corporate seal affixed.
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