- 7 - “Shareholders Agreement” (the 1981 Agreement).1 At the time, decedent and Mr. Jennings each owned one-half of BCC’s outstanding stock. The 1981 Agreement contained restrictions on transfers of BCC stock both during the shareholders’ lifetimes and at death. The preamble provided that subsequent shareholders would “benefit from and be bound by” the agreement. With respect to lifetime transfers, a section entitled “Restrictions on Transfer of Capital Stock During Life” provided: “No Shareholder shall transfer or encumber any of his Capital Stock in the Company to any person, firm, or corporation without the written consent of the other Shareholders.” “Shareholders” were defined in the 1981 Agreement’s first paragraph as decedent and Mr. Jennings, a definition that excluded subsequent shareholders. However, section 3(a) of the 1981 Agreement, entitled “Other Shareholders to be Bound”, also denoted as “shareholders” persons other than Mr. Jennings or decedent who received shares directly from BCC or as transferees from other shareholders. The section further provided that the shares of such other shareholders would 1 Decedent, Mr. Jennings, and BCC had previously entered into a restrictive agreement in 1958 covering their BCC stock. The 1981 Agreement expressly provided that it superseded any earlier agreements.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011