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    Shareholder Buy-Sell Agreement - Hybrid Method | Canada


    The Canada Shareholder Buy-Sell Agreement (Hybrid Method) is an option that Canadians can consider to put a succession plan in place for the continuity of their small business.

    • This type of buy-sell agreement is known as a 'hybrid' buy-sell.
    • Under this Agreement, the corporation holds life insurance policies on each of the shareholders.
    • Upon a shareholder's death, the corporation will collect the insurance proceeds, and use the proceeds to fund the purchase of the deceased shareholder's shares by any of the surviving shareholders who are interested, on a pro rata basis (proportional to their existing shareholdings).
    • Any unpurchased shares will be redeemed by the corporation.
    • The corporation will make an election for a deemed dividend to be paid from the capital dividend account if possible.
    • The Agreement is governed by Canadian income tax laws.
    • This legal contract form is available in MS word format and is fully editable.
    Download Type: Microsoft Word
    Last Updated: 23-August-2021
    SKU: 3005
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