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    Shareholder Buy-Sell Agreement (Promissory Note Method) | Canada


    Plan ahead for the continuation of your business upon the death or retirement of an owner with this Shareholder Buy-Sell Agreement (Promissory Note Method) for Canadian companies.

    • The corporation will hold life insurance policies on each of the shareholders and use the proceeds to redeem and acquire its own shares from a deceased shareholder's estate.
    • If a shareholder dies, the surviving shareholders can purchase the deceased's shares on a pro rata basis (proportionate to their current shareholdings) by issuing the corporation a promissory note for the purchase price.
    • The corporation will loan the purchaser the amount of the purchase price from the insurance proceeds, and then makes an election for a deemed dividend to be paid from the capital dividend account if possible.
    • This is a fully editable legal form in MS Word format which can be customized to fit your circumstances.
    • Governed by Canadian tax laws and ntended to be used only in Canada.
    Download Type: Microsoft Word
    Last Updated: 18-February-2022
    SKU: 3004