[{"data":1,"prerenderedAt":524},["ShallowReactive",2],{"document-put-option-agreement-D339":3},{"document":4,"label":23,"preview":11,"thumb":24,"thumb600":25,"description":5,"descriptionCustom":6,"apiDescription":5,"pages":8,"extension":10,"parents":26,"breadcrumb":30,"related":38,"customDescModule":174,"customdescription":6,"mdFm":175,"mdProseHtml":523},{"description":5,"descriptionCustom":6,"label":7,"pages":8,"size":9,"extension":10,"preview":11,"thumb":12,"svgFrame":13,"seoMetadata":14,"parents":15,"keywords":22},"PUT OPTION AGREEMENT This Put Option Agreement (the \"Agreement\") is effective [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"First Quorum\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [COMPANY NAME] (the \"Second Quorum\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [COMPANY NAME] (the \"First Investor\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [COMPANY NAME] (the \"Second Investor\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [COMPANY NAME] (the \"Company\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS pursuant to a financing agreement made the [DATE] (the \"Financing Agreement\") each of [SPECIFY] (the \"Investors\") have each agreed to make a convertible subordinated term loan, convertible in whole or in part into common shares of the Company and each have agreed to subscribe for common shares of Company all in accordance with the terms and conditions set forth in the Financing Agreement (the shares issuable upon conversion of the loan together with the shares subscribed for as aforesaid are hereafter the \"Company Shares\"); AND WHEREAS Company and the Investors have agreed that, subject to the satisfaction of the conditions set forth in section [SPECIFY] of the Financing Agreement, each of the Investors shall have the right to put all of its Company Shares to Company in exchange for cash, upon the terms and subject to the conditions of this Agreement; NOW, THEREFORE, in consideration of the foregoing and the mutual promises of the parties hereto, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: PUT OPTION Grant of Option Upon the terms and subject to the conditions of this Agreement, Company hereby grants to each of the Investors an option (the \"Option\") to require Company to purchase from each of the Investors all but not less than all of its Company Shares held by each of the Investors on the Effective Date (as defined below). Effectiveness The Option shall become effective and exercisable on or after [DATE] (the \"Effective Date\") unless an Initial Public Offering, Secondary Public Offering or Private Sale (as those terms are defined in the Financing Agreement) has been completed prior to such date, but in any case shall expire on [DATE]. Exercise of Option Delivery of Put Notice. Any Investor may exercise the Option by delivering to Company, at the address designated and in the manner described in Section 2, at any time after the Effective Date written notice of such exercise (the \"Put Notice\"). Put Notice. The Put Notice shall specify (i) the date on which the Option will be completed (the \"Put Completion Date\"), which may be no earlier than [NUMBER] days following the date an Investor sends the Put Notice to Company and; (ii) the name and address of the entity or person to whom payment of the Put Purchase Price (as defined below) shall be made. Purchase Price The aggregate purchase price for the Company Shares (the \"Put Purchase Price\") to be purchased by Company upon exercise of the Option pursuant to this Section 1 shall be at any particular date, the dollar amount per share equal to the fair market value per share of the Company Shares as at such date as determined by an evaluation board appointed in the manner set forth in paragraph [SPECIFY] of the shareholders agreement made [DATE] among the parties hereto and others (the \"Shareholders Agreement\"), which determination shall be final and binding on the parties hereto. Such evaluation board shall deliver its report within [NUMBER] days of its appointment. Payment of Purchase Price The Put Purchase Price shall be payable, as to [PERCENTAGE %] thereof, on the Put Completion Date, and as to balance thereof in equal installments on the last day of each of the [NUMBER], [NUMBER], [NUMBER], [NUMBER], [NUMBER], [NUMBER], [NUMBER], [NUMBER] and [NUMBER] months following the Put Completion Date, and shall bear interest at the Prime Rate (as defined in the Financing Agreement) until payment in full of the Put Purchase Price and all accrued and unpaid interest thereon is made. On Closing, Company shall deliver promissory notes to the Investors securing the unpaid balance of the Put Purchase Price. Such unpaid balance of the Put Purchase Price and all accrued interest thereon shall be evidenced by a promissory note and shall be secured by such security as the Investors may reasonably request and as may be permitted by [YOUR COUNTRY LAW], including without limitation a subordination and postponement of any debt of Company to any Shareholder of Company (other than the Investors who is a party to this Agreement. Closing Place, Time and Date. The closing of the sale and purchase of the Company Shares (the \"Closing\") shall take place at the offices of [INDIVIDUAL NAME], [FULL ADDRESS], [STATE/PROVINCE] at [HOUR] local time, on the Put Completion Date or such other place, time or date as the parties may agree. At the Closing, the Investors shall deliver to Company certificates representing the Company Shares, duly endorsed for transfer to Company or its designee, and Company shall deliver to the Investors the Put Purchase Price in the manner described in section 1.5",null,"Put Option Agreement","6",67,"doc","https://templates.business-in-a-box.com/imgs/1000px/put-option-agreement-D339.png","https://templates.business-in-a-box.com/imgs/250px/339.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#339.xml",{"title":6,"description":6},[16,19],{"label":17,"url":18},"Finance & Accounting","/templates/finance-accounting/",{"label":20,"url":21},"Buy & Sell Shares","/templates/buy-sell-shares/","put option agreement","Put Option Agreement Template","https://templates.business-in-a-box.com/imgs/400px/339.png","https://templates.business-in-a-box.com/imgs/600px/339.png",[27,16,19],{"label":28,"url":29},"Templates","/templates/",[31,32,35],{"label":28,"url":29},{"label":33,"url":34},"Legal Agreements","/templates/business-legal-agreements/",{"label":36,"url":37},"Equity & Mergers","/templates/equity-and-mergers/",[39,43,47,51,55,59,63,67,71,75,79,83,87,103,117,131,146,160],{"label":40,"url":41,"thumb":42,"extension":10},"Option to Lease Agreement","/template/option-to-lease-agreement-D1193","https://templates.business-in-a-box.com/imgs/250px/1193.png",{"label":44,"url":45,"thumb":46,"extension":10},"Accept Option Extension of Agreement","/template/accept-option-extension-of-agreement-D845","https://templates.business-in-a-box.com/imgs/250px/845.png",{"label":48,"url":49,"thumb":50,"extension":10},"Option to Buy Agreement","/template/option-to-buy-agreement-D336","https://templates.business-in-a-box.com/imgs/250px/336.png",{"label":52,"url":53,"thumb":54,"extension":10},"Option to Buy Agreement Long","/template/option-to-buy-agreement-long-D1192","https://templates.business-in-a-box.com/imgs/250px/1192.png",{"label":56,"url":57,"thumb":58,"extension":10},"Employee Stock Option Agreement","/template/employee-stock-option-agreement-D12613","https://templates.business-in-a-box.com/imgs/250px/12613.png",{"label":60,"url":61,"thumb":62,"extension":10},"Equipment Lease Agreement With Option to Purchase","/template/equipment-lease-agreement-with-option-to-purchase-D1143","https://templates.business-in-a-box.com/imgs/250px/1143.png",{"label":64,"url":65,"thumb":66,"extension":10},"Notice of Grant of Stock Option","/template/notice-of-grant-of-stock-option-D896","https://templates.business-in-a-box.com/imgs/250px/896.png",{"label":68,"url":69,"thumb":70,"extension":10},"Option to Acquire Partnership Interests","/template/option-to-acquire-partnership-interests-D5227","https://templates.business-in-a-box.com/imgs/250px/5227.png",{"label":72,"url":73,"thumb":74,"extension":10},"Stock Option Plan","/template/stock-option-plan-D13284","https://templates.business-in-a-box.com/imgs/250px/13284.png",{"label":76,"url":77,"thumb":78,"extension":10},"Option to Purchase Real Estate Property","/template/option-to-purchase-real-estate-property-D1194","https://templates.business-in-a-box.com/imgs/250px/1194.png",{"label":80,"url":81,"thumb":82,"extension":10},"Exercising Option to Renew Lease","/template/exercising-option-to-renew-lease-D1175","https://templates.business-in-a-box.com/imgs/250px/1175.png",{"label":84,"url":85,"thumb":86,"extension":10},"Discount on Prepayment Option","/template/discount-on-prepayment-option-D211","https://templates.business-in-a-box.com/imgs/250px/211.png",{"description":88,"descriptionCustom":6,"label":89,"pages":90,"size":91,"extension":10,"preview":92,"thumb":93,"svgFrame":94,"seoMetadata":95,"parents":96,"keywords":101,"url":102},"STOCK AGREEMENT This Stock Agreement (the \"Agreement\") is made and effective [DATE] BETWEEN: [YOUR COMPANY NAME] (the \"Company\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [STOCKHOLDER NAME] (the \"First Stockholder\"), an individual with his main address located at OR a company organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [STOCKHOLDER NAME] (the \"Second Stockholder\"), an individual with his main address located at OR a company organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] RECITALS The above-named stockholders desire to assure continuity of ownership of the Company. The stockholders, after mutual consultations, have agreed, in order to insure such continuity, to restrict the sale or transfer of shares of the Company, both during the lifetime and at the death of any of the stockholders. For the reasons above set forth, and in consideration of the mutual covenants and promises of the parties hereto, the Company and the stockholders agree as follows: FIRST RIGHT OF PURCHASE IN COMPANY If any stockholder shall, during the stockholder's lifetime, desire to sell or transfer all or any part of the stockholder's shares of stock in the Company, the stockholder shall first offer to sell the above-mentioned shares to the Company at a price per share equal to the then book value of each of the shares as of the last day of the calendar month next preceding the date the shares are offered for sale. Book value shall be determined by the independent certified accountants for the Company and such valuation shall be in accordance with generally accepted accounting principles consistent with the method of accounting then employed by the Company and shall be binding on the parties. OFFER TO OTHER STOCKHOLDERS IF CORPORATION DOES NOT PURCHASE The offer to sell shall be communicated in writing by the selling stockholder to the board of directors of the corporation and to all other stockholders, and the corporation shall have a period of [NUMBER] days after receipt of such notice in which to exercise its rights to purchase the shares at a price determined as specified in Section One. If the corporation shall refuse or neglect to notify the selling stockholder in writing of its intention to purchase the shares within the [NUMBER]-day period, or if the corporation is prohibited by law from making such a purchase or redemption, the selling stockholder shall then notify in writing the other stockholders of the stockholder's intention to sell and the number of shares offered for sale and the other stockholders shall have an additional period of [NUMBER] days within which to accept the offer to sell on the same terms and conditions as offered to the corporation, each of the other stockholders having the right to purchase the number of shares owned by the selling stockholder equal to such purchasing stockholders' proportionate ownership of the corporation immediately prior to the receipt of such offer to sell. STOCKHOLDER'S RIGHTS IF NEITHER CORPORATION NOR OTHER STOCKHOLDERS EXERCISE OPTION If neither the corporation nor the other stockholders elect to purchase the shares within the time limited on the terms set forth above, the stockholder desiring to sell or transfer his or her shares shall be free to do so to any other person or corporation free of any restrictions provided herein; provided, however, that such sale or transfer shall not be on terms less favorable to the selling stockholder unless the less favorable terms are re-offered to the corporation and/or the other stockholders as herein provided. If the sale or transfer to any other such person or corporation is not completed within [NUMBER] days after the expiration of the periods of time set forth in this agreement, the selling stockholder must, before making any subsequent sale or transfer, re-offer the shares to the corporation and/or the other stockholders as provided in this agreement. CLOSING OF SALE","Stock Agreement","3",42,"https://templates.business-in-a-box.com/imgs/1000px/stock-agreement-D347.png","https://templates.business-in-a-box.com/imgs/250px/347.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#347.xml",{"title":6,"description":6},[97,99],{"label":17,"url":98},"finance-accounting",{"label":20,"url":100},"buy-sell-shares","shareholders agreement","/template/shareholders-agreement-D347",{"description":104,"descriptionCustom":6,"label":105,"pages":106,"size":107,"extension":10,"preview":108,"thumb":109,"svgFrame":110,"seoMetadata":111,"parents":112,"keywords":115,"url":116},"SHARE PURCHASE AGREEMENT This Share Purchase Agreement (the \"Agreement\") is effective [DATE], BETWEEN: [FIRST PARTY NAME] (the \"Company\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [SECOND PARTY NAME] (the \"Testamentary Executor / Seller\"), an individual with his/her main address located at: [COMPLETE ADDRESS] AND: [THIRD PARTY NAME] (the \"Purchaser\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS the Seller is the owner of [NUMBER] common shares in the capital stock of the Corporation (the \"Shares\"); WHEREAS the [COMPANY NAME] hereto have determined that the fair market value of the Shares is [AMOUNT]; WHEREAS the Corporation desires to purchase for cancellation and the Seller desires to sell the Shares; WHEREAS there are no reasonable grounds to believe that: (a) the Corporation is, or would after the payment of the purchase price be, unable to pay its liabilities as they become due, or (b) the realizable value of the Corporation's assets would after said payment be less than the aggregate of its liabilities and the amounts required for payment on a redemption or in a liquidation of all shares the holders of which have the right to be paid prior to the holders of the Shares; WHEREAS the aforesaid purchase will result in a deemed dividend of [AMOUNT] for the purposes of the [COUNTRY] Income Tax [ACT/LAW/RULE]; NOW THEREFORE, IT IS AGREED AS FOLLOWS: SHARES PURCHASED AND PURCHASE PRICE Subject to the terms and conditions set forth in this Agreement, the Corporation hereby purchases for cancellation the Shares from the Seller, hereto present and accepting, and the Seller delivers to the Corporation certificates representing the Shares. The aggregate purchase price for the Shares is [AMOUNT] (the \"Purchase Price\") which the parties consider to be the fair market value of the Shares, payable as set forth in Article [NUMBER] hereof. PAYMENT OF THE PURCHASE PRICE Upon filing by the Corporation of the election as set forth in Article [NUMBER] hereof, the Corporation will issue to the Seller a certificate representing [NUMBER] common shares of the Corporation (the \"Common Shares\") and a promissory note in the amount of [AMOUNT] (the \"Promissory Note\") in full payment of the Purchase Price. The parties hereto determine that the Common Shares and the Promissory Note have a fair market value of and are, in all circumstances of the transaction, the fair equivalent of a consideration payable in cash equal to the fair market value of the Shares. SELLER'S REPRESENTATIONS AND WARRANTIES The Seller represents and warrants to the Corporation that: the Shares are owned by the Seller by good and marketable title; the Seller is a resident of [COUNTRY] for the purposes of the Tax [ACT/LAW/RULE]; ELECTIONS","Share Purchase Agreement Deemed Dividend","4",56,"https://templates.business-in-a-box.com/imgs/1000px/share-purchase-agreement_deemed-dividend-D342.png","https://templates.business-in-a-box.com/imgs/250px/342.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#342.xml",{"title":6,"description":6},[113,114],{"label":17,"url":98},{"label":20,"url":100},"share purchase agreement deemed dividend","/template/share-purchase-agreement-deemed-dividend-D342",{"description":118,"descriptionCustom":6,"label":119,"pages":120,"size":121,"extension":10,"preview":122,"thumb":123,"svgFrame":124,"seoMetadata":125,"parents":127,"keywords":126,"url":130},"BUY-SELL AGREEMENT This Buy-Sell Agreement (this \"Agreement\") is made and effective this [Date], BETWEEN: [COMPANY NAME], a corporation organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: Each of the Parties listed below (each a \"Shareholder\" and collectively, the \"Shareholders\"). The Shareholders desire to promote and protect their mutual interests and the interests of the Company. Therefore, the parties hereby agree as follows: ARTICLE I PARTIES AND PURPOSE PARTIES The Shareholders own all the outstanding shares (the \"Shares\") of the [COMPANY NAME] in the amount outlined below. At this time, each Shareholder's interest in the Company is as follows: __________________ owns _________________ % __________________ owns _________________ % __________________ owns _________________ % __________________ owns _________________ % While this agreement is in effect, no Shareholder shall have any right to assign, encumber or dispose of his interest in the Company except as provided herein. PURPOSE The purpose of this Agreement is to protect the Corporation's management and control from persons not acceptable to all Shareholders. The other purpose is to provide a ready market in the event of the death, disability, or lifetime transfer of Shares by a Shareholder. To this end, the Shareholders have entered into this agreement to: Restrict the transfer or sale of the Shares by the Shareholders; Ensure any sale of the Shares is in the accordance with established procedures; Provide stability and continuity in the management of the Company; Maintain ownership or control of the Company ARTICLE II SALES TRANSFER RESTRICTION ON SHARES No Shareholder (or any party acting on behalf of a Shareholder) may sell or transfer its Shares, whether owned or subsequently acquired, except in accordance with the provisions of this Agreement or with the written consent of the Company and all other Shareholders. Any attempt to sell or transfer Shares (or an interest in Shares) that contravenes the terms of this agreement is null and void and is not binding on or recognized by the Company or the Shareholders. Definition of sale or transfer. The term \"sale or transfer\" includes any sale, pledge, encumbrance, gift, bequest, or other transfer of any Shares, whether or not the transfer would be made for value, or to another Shareholder, or voluntarily or involuntarily or by operation of law, or during his lifetime or upon his death Exception. A sale or transfer of a Shareholder's Shares to a trust that is wholly revocable by that Shareholder and for which that Shareholder is the sole trustee is not a prohibited sale or transfer. However, any subsequent attempted sale or transfer by the trustee of such trust shall be subject to all of the terms of this Agreement with the Shareholder (and not the trust) deemed as the Shareholder of such Shares. Legend on share certificates. Each share certificate whether presently owned or subsequently acquired, shall have the following statement conspicuously printed on its face: \"The transfer, sale, assignment of the Shares represented by this certificate is restricted by a Buy-Sell Agreement among all the Shareholders and the Corporation dated [SPECIFY]. A copy of the Buy-Sell Agreement is available for inspection during normal business hours at the principal office of the Corporation. All the terms and provisions of the Buy-Sell Agreement are incorporated by this reference and made a part of this certificate.\" ARTICLE III VOLUNTARY TRANSFER PERMITTED SALE OR TRANSFER DURING LIFETIME Any Shareholder wishing to sell or transfer its Shares must first notify each of the other Shareholders in writing. Such Shareholder (a \"Seller\") will be deemed to have offered to sell its Shares (the \"Offering Shares\") to other Shareholders. The notice must indicate the name of the party (the \"third party purchaser\") to whom the seller wishes to sell or transfer the offered Shares and the terms of the proposed sale or transfer. First option to other Shareholders. Each of the other Shareholders will have thirty (30) days from the effective date of the notice to choose to purchase the Offered Shares in proportion to their respective ownership of all outstanding Shares (excluding the Offered Shares) or in such other proportion as the other Shareholders may agree. During this 30-day period, the other Shareholders must collectively agree to purchase all or none of the Offered Shares. If the other Shareholders exercise their call option, they must acquire the Offering Shares on the same terms as those set out in the proposed notice of sale or transfer. These conditions will be supplemented, as necessary, by the payment conditions described in Article VI below. Notice of proposed sale. Any Shareholder wishing to sell his/her Shares shall provide a Notice of Proposed Sale. The notice must specify: the name and address of each proposed transferee; the number of Shares or the interest in Shares to be transferred; the price per Share; the terms of the proposed sale, assignment, or transfer. Permitted sale or transfer to third party purchaser. When the other Shareholders do not exercise their right to purchase all the Shares offered within the 30-day period, the seller may then conclude the sale or transfer to the third-party purchaser. However, the sale or transfer must be made on the same terms and conditions as those set out in the notice to other Shareholders. In addition, the third-party buyer must agree in writing to be bound by the terms of this contract before or at the time of the sale or transfer. If the sale or transfer to the third-party acquirer is not completed within sixty (60) days of the expiry of the other Shareholder's 30-day option period, then the authorization to sell or transfer under this agreement shall be deemed to have been withdrawn as if no sale or transfer had been considered and no notice given. ARTICLE IV INVOLUNTARY TRANSFER INVOLUNTARY LIFETIME SALE OR TRANSFER Any Shareholder who holds information that could reasonably be expected to result in an involuntary lifetime sale of his or her Shares and any person or entity that has acquired or may acquire an interest in such Shares must promptly notify each of the other Shareholders in writing. The notice must describe the nature and details of the involuntary lifetime sale and must indicate the name of the party (the \"third party transferee\"). The Shareholder will be deemed to have offered to sell its Shares (the \"Offering Shares\") to other Shareholders. The following events shall each constitute an \"Involuntary\" transfer event: the death of a Shareholder; the total mental or physical disability of a Shareholder; the termination of a Shareholder's employment with [COMPANY NAME]; and the bankruptcy or insolvency of a Shareholder. First option to other Shareholders. Each of the other Shareholders will have thirty (30) days from the effective date of this notice to elect to purchase the Offered Shares in proportion to their respective ownership of all outstanding Shares (excluding the Offered Shares) or in such other proportion as the other Shareholders may agree. If the other Shareholders exercise their option to purchase some or all of the offered Shares, they must then acquire these Shares at the purchase price and on the payment, terms described in Articles VI and VII below. Permitted sale or transfer to third party transferee. If the other Shareholders do not validly exercise their option to buy all of the Offered Shares within the 30-day period, then any remaining Offered Shares may be transferred to the third-party transferee. However, the transfer must be made on the same terms and conditions as those contained in the notice to the other Shareholders","Buy Sell Agreement","8",513,"https://templates.business-in-a-box.com/imgs/1000px/buy-sell-agreement-D12611.png","https://templates.business-in-a-box.com/imgs/250px/12611.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12611.xml",{"title":126,"description":6},"buy sell agreement",[128,129],{"label":17,"url":98},{"label":20,"url":100},"/template/buy-sell-agreement-D12611",{"description":132,"descriptionCustom":6,"label":133,"pages":90,"size":121,"extension":10,"preview":134,"thumb":135,"svgFrame":136,"seoMetadata":137,"parents":139,"keywords":138,"url":145},"NON-DISCLOSURE AGREEMENT (NDA) This Non-Disclosure Agreement (the \"Agreement\") is made and effective [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"Disclosing Party\"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [RECEIVING PARTY NAME] (the \"Receiving Party\"), an individual with his main address located at OR a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS, Receiving Party has been or will be engaged in the performance of work on [DESCRIBE]; and in connection therewith will be given access to certain confidential and proprietary information; and WHEREAS, Receiving Party and Disclosing Party wish to evidence by this Agreement the manner in which said confidential and proprietary material will be treated. NOW, THEREFORE, it is agreed as follows: NON-DISCLOSURE OF CONFIDENTIAL INFORMATION Both Parties understand and agree that each Party may have access to the confidential information of the other party. For the purposes of this Agreement, \"Confidential Information\" means proprietary and confidential information about the Disclosing Party's (or it's suppliers') business or activities. Such information includes all business, financial, technical, and other information marked or designated by such Party as \"confidential\" or \"proprietary.\" Confidential Information also includes information which, by the nature of the circumstances surrounding the disclosure, ought in good faith to be treated as confidential. For the purposes of this Agreement, Confidential Information does not include: Information that is currently in the public domain or that enters the public domain after the signing of this Agreement. Information a Party lawfully receives from a third Party without restriction on disclosure and without breach of a non-disclosure obligation. Information that the Receiving Party knew prior to receiving any Confidential Information from the Disclosing Party. Information that the Receiving Party independently develops without reliance on any Confidential Information from the Disclosing Party. Each Party agrees that it will not disclose to any third Party or use any Confidential Information disclosed to it by the other Party except when expressly permitted in writing by the other Party. Each Party also agrees that it will take all reasonable measures to maintain the confidentiality of all Confidential Information of the other Party in its possession or control. TERM The term of this Agreement is [number] of [years/months] from the date of execution by both Parties. TITLE The Receiving Party agrees that all Confidential Information furnished by the Disclosing Party shall remain the sole property of the Disclosing Party. DISCLAIMER","Non Disclosure Agreement Nda","https://templates.business-in-a-box.com/imgs/1000px/non-disclosure-agreement-nda-D12692.png","https://templates.business-in-a-box.com/imgs/250px/12692.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12692.xml",{"title":138,"description":6},"non disclosure agreement nda",[140,142],{"label":33,"url":141},"business-legal-agreements",{"label":143,"url":144},"Confidentiality Agreements","confidentiality-agreement","/template/non-disclosure-agreement-nda-D12692",{"description":147,"descriptionCustom":6,"label":148,"pages":90,"size":91,"extension":10,"preview":149,"thumb":150,"svgFrame":151,"seoMetadata":152,"parents":153,"keywords":158,"url":159},"TERM SHEET Issue: [Venture Capital FIRM] (\"VC\") and/or any member of its corporate group (\"the VC Group\") will purchase up to [AMOUNT] Series A Convertible Preferred Stock (\"Series A\") newly issued by [YOUR COMPANY NAME] (the \"Company\") at a price per share of [PRICE] (the \"Purchase Price\"). In addition, other investors shall purchase at least [AMOUNT] but not more than [AMOUNT] of newly issued Series A at the Purchase Price. The shares of Series A will be convertible at any time at the option of the holder into common shares of the Company (\"Common Stock\") on a one-for-one basis, adjusted for future share splits. The Purchase Price equates to a pre-money valuation of [VALUATION]. The calculation is based on [NUMBER] fully diluted shares of Common Stock. If the number of shares issued, or stock awards/options authorized increases before the closing the price per share for Series A Convertible Preferred Stock shall be reduced so that the pre-money valuation is unchanged. The Series A Convertible Preferred Stock shall be referred to herein as the \"Preferred Stock.\" Dividend: The Preferred Stock is entitled to an annual [AMOUNT] per share dividend, payable when and if declared by the Board of Directors, but prior to any payment on Common Stock; dividends are not cumulative. Liquidation Preference: The Series A will have a liquidation preference so that proceeds on a merger, sale or liquidation (including non-cumulative dividends) will first be paid to the Series A and will include a [%] per annum compounding guaranteed return calculated on the total amount invested. Upon completion of an additional round of funding of at least [AMOUNT] the compounding guaranteed return feature will expire. The liquidation preference will cease to operate if the proceeds due to Series A, on a merger, sale or liquidation on an as-converted basis, exceed the proceeds that would be due under the liquidation preference. Use of Proceeds: The funds raised by Series A will be used principally for general working capital purposes. Voting Rights: The holders of the Series A shall have the right to vote with the Common Stock on an as-if-converted basis. Redemption: If not previously converted, the Series A is to be redeemed in three equal successive annual installments beginning [DATE]. Redemption will be at the purchase price plus a [%] per annum cumulative guaranteed return. Pre-emptive Rights: Holders of the Preferred Stock will be granted rights to participate in future equity financings of the Company based upon their pro-rata, as-if-converted, ownership of the Company. Automatic Conversion: The Preferred Stock shall be automatically converted into Common Stock at the then applicable conversion rate (1:1 assuming no share splits) in the event of an underwritten public offering of shares of the Company at a total offering of not less than [AMOUNT] and at a per share public offering price of not less than three times the Series A purchase price per share, adjusted for splits. Anti-Dilution: Series A shall have weighted average anti-dilution, based on a weighted average formula to be agreed, for all securities purchased as part of this transaction (excluding shares, options and warrants issued for management incentive and small issues for strategic purposes of under [NUMBER] shares). Management Options: Simultaneously with this transaction, one million new shares shall expand the Company's management incentive stock option pool - bringing the total number of shares issued and stock incentives (awards and options) authorized to [NUMBER OF SHARES]. Rights of First Offer; Tag-Along: The Company and the Investors will have a right of first refusal with respect to any employee's shares proposed to be resold. Alternatively, the Investors will have the right to participate in the sale of any such shares to a third party (co-sale rights), which rights will terminate upon a public offering. Information Rights: Monthly actual vs. plan and prior year. Annual budget [NUMBER] days before beginning of fiscal year","Term Sheet","https://templates.business-in-a-box.com/imgs/1000px/term-sheet-D473.png","https://templates.business-in-a-box.com/imgs/250px/473.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#473.xml",{"title":6,"description":6},[154,155],{"label":17,"url":98},{"label":156,"url":157},"Raising Capital","raising-capital","term sheet","/template/term-sheet-D473",{"description":161,"descriptionCustom":6,"label":162,"pages":90,"size":121,"extension":10,"preview":163,"thumb":164,"svgFrame":165,"seoMetadata":166,"parents":168,"keywords":167,"url":173},"INVESTMENT AGREEMENT This Investment Agreement (the Agreement) is made and effective [DATE], BETWEEN: [YOUR COMPANY NAME] a Company (the \"COMPANY\") organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [YOUR NAME] the principal members of the Company (the \"Company Principals\") collectively referred to in this Agreement as the \"Company Parties.\" and existing under the laws of [STATE/PROVINCE], located at: [COMPLETE ADDRESS] AND: [YOUR COMPANY NAME] a Company (the \"COMPANY\") organized and existing under the laws of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS the Company was formed for the purpose of further developing, commercializing, and operating the business concept identified and includes any subsequent iteration of the business concept developed by the Company Parties (the \"Business\"); WHEREAS the Investor is desirous of making an investment (the \"Investment\") in the amount of [TOTAL INVESTMENT AMOUNT] into the Company to facilitate such Business. NOW THEREFORE, in consideration of the mutual covenants and agreements herein contains, the parties hereto intending to be legally bound agree as follows: THE INVESTMENT 1.1 The Investor will make the Investment in the Company in consideration for the rights and privileges set forth in this Agreement. FUTURE ISSUANCES OF SECURITIES 2.1 From and after the date of this Agreement, the parties agree to take such further action and to execute, acknowledge and deliver all such further documents as are reasonably requested by the other party for carrying out the purposes of this Agreement. 2.2 If at any time in the future, the Company proposes to sell and issue any debt or equity securities, or any other securities or instruments entitling the holder thereof to receive any profits, capital, assets or property of the Company (collectively, \"Securities\"), in a single transaction or series of related transactions that results in gross proceeds to the Company of at least [STATE AMOUNT] (a \"Qualified Financing\"), the Company shall deliver written notice to the Investor stating (i) its bona fide intention to offer such Securities, (ii) the amount and type of Securities to be offered and (iii) the price and terms upon which it proposes to offer such securities. Upon receipt of such notice, the Investor shall be entitled to exercise any of the rights specified in sections 3, 4 and 5. RIGHT OF FIRST OFFER 3.1 The Investor shall have the first right to purchase all the Securities to be offered and sold in such Qualified Financing at the price and on the same terms and conditions specified in the notice. RIGHT TO PARTICIPATE 4","Investment Agreement","https://templates.business-in-a-box.com/imgs/1000px/investment-agreement-D12831.png","https://templates.business-in-a-box.com/imgs/250px/12831.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12831.xml",{"title":167,"description":6},"investment agreement",[169,170],{"label":17,"url":98},{"label":171,"url":172},"Shareholders & Investors","shareholders-investors","/template/investment-agreement-D12831",false,{"seo":176,"reviewer":188,"legal_disclaimer":192,"quick_facts":193,"at_a_glance":195,"personas":199,"variants":224,"glossary":252,"clauses":289,"how_to_fill":340,"common_mistakes":381,"faqs":406,"industries":434,"comparisons":451,"diy_vs_lawyer":467,"jurisdictions":480,"related_template_ids_curated":501,"schema":510,"classification":511},{"meta_title":177,"meta_description":178,"primary_keyword":179,"secondary_keywords":180},"Put Option Agreement Template (Free Word)","Free put option agreement template for shares, assets, or business interests. Covers exercise price, option period, conditions, and payment. Free Word and PDF download.","put option agreement template",[22,181,182,183,184,185,186,187],"put option contract template","shareholder put option agreement","put option agreement word","put option agreement free download","share put option agreement template","put option agreement sample","business put option agreement",{"name":189,"credential":190,"reviewed_date":191},"Bruno Goulet","CEO, Business in a Box","2026-05-02",true,{"difficulty":194,"legal_review_recommended":192,"signature_required":192,"notarization_required":174},"advanced",{"what_it_is":196,"when_you_need_it":197,"whats_inside":198},"A Put Option Agreement is a legally binding contract that grants one party (the option holder) the right — but not the obligation — to sell a specified asset, shares, or business interest to another party (the grantor) at a predetermined price within a defined period. This free Word download gives you a structured, professionally drafted starting point you can edit online and export as PDF for use in share buybacks, joint venture exits, real estate transactions, and private equity arrangements.\n","Use it when a shareholder, investor, or asset owner needs a contractual guarantee that they can exit their position at an agreed price, regardless of market conditions at the time they choose to sell. It is commonly triggered at the close of a funding round, the formation of a joint venture, or as part of a buyout or succession arrangement.\n","Parties and recitals, definition of the option asset, exercise price and valuation mechanism, option period and exercise procedure, conditions precedent to exercise, payment terms and completion mechanics, representations and warranties, default and remedies, and governing law.\n",[200,204,208,212,216,220],{"title":201,"use_case":202,"icon_asset_id":203},"Private equity investors","Securing a guaranteed exit from a portfolio company at a floor valuation","persona-investor",{"title":205,"use_case":206,"icon_asset_id":207},"Minority shareholders","Protecting the right to sell shares back to a majority owner at a fixed price","persona-small-business-owner",{"title":209,"use_case":210,"icon_asset_id":211},"Joint venture partners","Establishing a contractual exit mechanism at the formation of a joint venture","persona-operations-director",{"title":213,"use_case":214,"icon_asset_id":215},"Startup founders","Granting investors a put right as part of a preferred share or convertible note arrangement","persona-startup-founder",{"title":217,"use_case":218,"icon_asset_id":219},"Corporate M&A teams","Structuring phased acquisitions where the seller retains a put on remaining shares","persona-ceo",{"title":221,"use_case":222,"icon_asset_id":223},"Real estate investors","Securing the right to sell a property interest back to a co-investor at a predetermined price","persona-franchise-applicant",[225,229,233,237,241,245,248],{"situation":226,"recommended_template":227,"slug":228},"Granting an investor the right to sell shares back to the company","Put Option Agreement (Shares)","put-option-agreement-D339",{"situation":230,"recommended_template":231,"slug":232},"Structuring a reciprocal buy-sell right between joint venture partners","Shareholders Agreement with Put and Call Options","shareholders-agreement-D347",{"situation":234,"recommended_template":235,"slug":236},"Granting the company the right to buy back shares from an investor","Call Option Agreement","option-to-lease-agreement-D1193",{"situation":238,"recommended_template":239,"slug":240},"Documenting the full transfer of shares after a put option is exercised","Share Purchase Agreement","share-purchase-agreement-deemed-dividend-D342",{"situation":242,"recommended_template":243,"slug":244},"Providing a minority shareholder a guaranteed exit in a buyout","Buy-Sell Agreement","buy-sell-agreement-D12611",{"situation":246,"recommended_template":247,"slug":228},"Combining a put and call into a single bilateral option instrument","Put and Call Option Agreement",{"situation":249,"recommended_template":250,"slug":251},"Granting a put right over real property rather than shares","Real Estate Option Agreement","option-to-purchase-real-estate-property-D1194",[253,256,259,262,265,268,271,274,277,280,283,286],{"term":254,"definition":255},"Put Option","The contractual right — but not the obligation — to sell a specified asset to a designated buyer at a pre-agreed price within a set period.",{"term":257,"definition":258},"Option Holder","The party who holds the put option and may choose to exercise the right to sell the asset.",{"term":260,"definition":261},"Grantor","The party who grants the put option and is obligated to purchase the asset if the option holder exercises the right.",{"term":263,"definition":264},"Exercise Price","The fixed or formula-determined price at which the asset will be sold if the option is exercised — also called the strike price.",{"term":266,"definition":267},"Option Period","The window of time during which the option holder may exercise the put right; once this period lapses, the option expires unexercised.",{"term":269,"definition":270},"Exercise Notice","The written notice the option holder delivers to the grantor to formally trigger the put option and initiate the sale process.",{"term":272,"definition":273},"Completion","The closing of the sale transaction after the put option is exercised — the point at which title transfers and payment is made.",{"term":275,"definition":276},"Conditions Precedent","Specific conditions that must be satisfied before the option can be exercised or before completion can occur, such as regulatory approval or board consent.",{"term":278,"definition":279},"Drag-Along Right","A related shareholder right that allows a majority owner to compel minority shareholders to join a sale — often paired with put and call provisions in shareholder agreements.",{"term":281,"definition":282},"Representations and Warranties","Contractual statements of fact made by each party at the time of signing and exercise, providing the other party legal recourse if they prove false.",{"term":284,"definition":285},"Default","A breach of the agreement by the grantor — typically failure to pay the exercise price at completion — triggering the option holder's remedies.",{"term":287,"definition":288},"Anti-Dilution","A provision adjusting the exercise price downward if the company issues new shares at a lower valuation, protecting the option holder's economic return.",[290,295,300,305,310,315,320,325,330,335],{"name":291,"plain_english":292,"sample_language":293,"common_mistake":294},"Parties and recitals","Identifies the option holder and the grantor by their full legal names and entity types, and summarizes the commercial context and purpose of the agreement.","This Put Option Agreement is entered into on [DATE] between [OPTION HOLDER FULL LEGAL NAME], a [ENTITY TYPE] incorporated in [JURISDICTION] ('Option Holder'), and [GRANTOR FULL LEGAL NAME], a [ENTITY TYPE] incorporated in [JURISDICTION] ('Grantor').","Using a trade name instead of the registered legal entity name — enforcement against the wrong entity can render the agreement worthless if the grantor disputes liability.",{"name":296,"plain_english":297,"sample_language":298,"common_mistake":299},"Grant of put option","States that the grantor irrevocably grants the option holder the right to sell the defined asset at the exercise price during the option period, and confirms the option holder is under no obligation to exercise.","The Grantor hereby irrevocably grants to the Option Holder the right (but not the obligation) to require the Grantor to purchase the Option Shares at the Exercise Price at any time during the Option Period, subject to the terms of this Agreement.","Omitting the word 'irrevocably' — without it, the grantor may argue the option can be withdrawn before exercise, destroying its commercial value.",{"name":301,"plain_english":302,"sample_language":303,"common_mistake":304},"Definition of the option asset","Precisely identifies the shares, units, or asset that is the subject of the put — including class, number, certificate numbers, and any encumbrances.","The 'Option Shares' means [NUMBER] ordinary shares of [COMPANY NAME] (Company No. [XXXXXX]), representing [X]% of the issued share capital as at the date of this Agreement, registered in the name of the Option Holder and free from all encumbrances.","Describing the asset by percentage only without a fixed number — if new shares are issued before exercise, the percentage calculation becomes disputed.",{"name":306,"plain_english":307,"sample_language":308,"common_mistake":309},"Exercise price and valuation mechanism","States the price the grantor must pay on exercise — either a fixed amount or a formula tied to earnings, revenue, or a third-party valuation — and specifies how disputes about value are resolved.","The 'Exercise Price' means $[FIXED AMOUNT] per Option Share; or, if the parties elect a formula basis, [X] times EBITDA for the 12-month period ending [DATE], as confirmed by an independent accountant appointed by [METHOD] within [X] business days of an Exercise Notice.","Using a formula with undefined inputs — terms like 'fair market value' without a defined appraisal process create disputes that delay or prevent completion.",{"name":311,"plain_english":312,"sample_language":313,"common_mistake":314},"Option period and exercise procedure","Defines the start and end dates of the option window, the form and delivery method of the exercise notice, and any blackout periods during which the option cannot be exercised.","The Option Holder may exercise the put option at any time from [START DATE] to [END DATE] ('Option Period') by delivering a written Exercise Notice to the Grantor at the address set out in Clause [X]. The Option Period shall not be extended without the written consent of both parties.","Failing to specify what happens if the exercise notice is sent but the option period expires before completion — leaving the transaction in legal limbo.",{"name":316,"plain_english":317,"sample_language":318,"common_mistake":319},"Conditions precedent to exercise","Lists any approvals, consents, or events that must occur before the option can be validly exercised or before the sale can complete — such as board approval, regulatory clearance, or a triggering event.","Exercise of the put option is conditional upon: (a) receipt of written consent from the board of directors of [COMPANY NAME]; (b) no material adverse change in the business of [COMPANY NAME] occurring after the date of this Agreement; and (c) [ANY OTHER CONDITIONS].","Including overly broad conditions precedent that the grantor controls — allowing the grantor to block exercise indefinitely by withholding a consent that is entirely within its power to grant.",{"name":321,"plain_english":322,"sample_language":323,"common_mistake":324},"Completion mechanics and payment terms","Sets the date by which completion must occur after a valid exercise notice, how the exercise price is paid (wire transfer, escrow, installments), and the simultaneous obligations of each party at closing.","Completion shall occur on the date falling [X] business days after delivery of the Exercise Notice. At Completion, the Grantor shall pay the Exercise Price in full by wire transfer to [ACCOUNT DETAILS], and the Option Holder shall deliver duly executed stock transfer forms and the relevant share certificates.","No escrow or security for the exercise price — if the grantor is illiquid at completion, the option holder has only a damages claim with no guaranteed recovery.",{"name":326,"plain_english":327,"sample_language":328,"common_mistake":329},"Representations and warranties","Each party confirms fundamental facts — that they have authority to enter the agreement, the shares are unencumbered, and no prior agreements conflict with its terms — giving the other party a breach of warranty claim if any representation proves false.","The Option Holder represents and warrants that: (a) it has full power and authority to enter into this Agreement; (b) the Option Shares are legally and beneficially owned by the Option Holder free from all encumbrances; and (c) there are no agreements restricting the transfer of the Option Shares.","Omitting the grantor's representations — particularly a warranty that the grantor has the financial capacity and authority to complete the purchase, without which the option holder has no warranty claim if the grantor cannot fund completion.",{"name":331,"plain_english":332,"sample_language":333,"common_mistake":334},"Default and remedies","Specifies what constitutes a default by either party and the remedies available — specific performance, interest on late payment, and the right to bring legal proceedings for losses caused by the breach.","If the Grantor fails to pay the Exercise Price at Completion, the Option Holder may: (a) seek an order for specific performance compelling the Grantor to complete; (b) claim interest on the unpaid Exercise Price at [X]% per annum from the Completion Date; and (c) claim all losses, costs, and expenses arising from the default.","Relying on damages as the sole remedy — specific performance is often the more valuable right because it forces the sale to complete rather than leaving the option holder with a money judgment against a potentially insolvent grantor.",{"name":336,"plain_english":337,"sample_language":338,"common_mistake":339},"Governing law and dispute resolution","Specifies which jurisdiction's law governs the agreement and how disputes are resolved — litigation, arbitration, or mediation — and the seat and language of any arbitral proceedings.","This Agreement is governed by the laws of [STATE / PROVINCE / COUNTRY]. Any dispute arising out of or in connection with this Agreement shall be referred to and finally resolved by [binding arbitration / the courts of [JURISDICTION]], with proceedings conducted in [LANGUAGE] in [CITY].","Choosing governing law based on convenience rather than where the asset or grantor is located — courts in several jurisdictions will apply local mandatory law regardless of a foreign-law choice, particularly for share transfers of domestic companies.",[341,346,351,356,361,366,371,376],{"step":342,"title":343,"description":344,"tip":345},1,"Identify the parties and their legal entities","Enter the full registered legal name, jurisdiction of incorporation, and registered address for both the option holder and the grantor. Confirm that each party has authority to enter the agreement through its constitutional documents.","Run a company registry search before signing to confirm the grantor's legal name and good standing — an entity that has been dissolved cannot be bound by the agreement.",{"step":347,"title":348,"description":349,"tip":350},2,"Define the option asset precisely","Specify the exact shares or asset subject to the put by class, number, and certificate number. If the asset is a shareholding, confirm the percentage it represents and whether that percentage is dilution-protected.","Include an anti-dilution adjustment formula if new share issuances are likely before the option period ends — otherwise a dilutive fundraise will reduce the value of the put without a price adjustment.",{"step":352,"title":353,"description":354,"tip":355},3,"Set the exercise price or valuation formula","Choose between a fixed exercise price (simpler, more certain) and a formula-based price tied to EBITDA, revenue, or net asset value. If using a formula, define every input term and appoint a tiebreaker mechanism for valuation disputes.","A fixed price provides certainty for both parties; a formula-based price is fairer if the option period is long — but always include a floor and a cap to bound the range.",{"step":357,"title":358,"description":359,"tip":360},4,"Define the option period with specific calendar dates","Enter exact start and end dates for the option window. Avoid 'trigger event' start dates without also specifying a long-stop date — open-ended option periods create valuation uncertainty and can be difficult to enforce.","Option periods of 12–36 months are typical for private equity and joint venture arrangements. Options running longer than 5 years may face enforceability challenges in some jurisdictions.",{"step":362,"title":363,"description":364,"tip":365},5,"Draft conditions precedent carefully","List every condition that must be met before exercise or completion. If regulatory approval is required, specify the authority and the deadline for obtaining it. Avoid conditions the grantor controls unilaterally.","Add a 'deemed satisfaction' provision stating that conditions are deemed met if the grantor fails to use reasonable endeavors to satisfy them within a specified period.",{"step":367,"title":368,"description":369,"tip":370},6,"Specify completion mechanics and payment security","Set a specific completion date (typically 10–20 business days after exercise notice), the payment method, and whether funds will be held in escrow pending transfer of title. Include simultaneous exchange obligations so neither party is exposed.","If the grantor's ability to fund the exercise price is uncertain, negotiate a payment guarantee, a letter of credit, or an escrow funded at signing rather than at exercise.",{"step":372,"title":373,"description":374,"tip":375},7,"Include specific performance as an express remedy","Confirm that the option holder's right to seek specific performance — forcing the grantor to complete the purchase — is expressly preserved alongside damages claims.","In many jurisdictions, specific performance is discretionary unless the contract expressly records that the parties intend it to be available — include that language explicitly.",{"step":377,"title":378,"description":379,"tip":380},8,"Execute the agreement before any triggering event","Both parties must sign the agreement before the events or circumstances that will make the put right valuable — signing after a dispute arises is too late. Date the agreement accurately and retain executed originals.","Use Business in a Box eSign to timestamp execution and create an auditable record of when signatures were applied relative to any triggering events.",[382,386,390,394,398,402],{"mistake":383,"why_it_matters":384,"fix":385},"Omitting 'irrevocable' from the grant clause","Without express irrevocability, the grantor may argue the option can be withdrawn at any time before exercise, negating the entire commercial purpose of the agreement.","State in the grant clause that the put option is 'irrevocably granted' and cannot be withdrawn, amended, or waived except by written agreement signed by both parties.",{"mistake":387,"why_it_matters":388,"fix":389},"Using an undefined valuation formula for the exercise price","Terms like 'fair market value' or 'agreed value' without a defined appraisal process create disputes that can take months to resolve, blocking completion and destroying the option's utility.","Define every input to the formula, name a specific valuation methodology (e.g., trailing 12-month EBITDA × [X]), and appoint a named or deterministic tiebreaker — such as the president of the relevant CPA institute — to resolve disputes within 30 days.",{"mistake":391,"why_it_matters":392,"fix":393},"Allowing the grantor to control conditions precedent","If a condition requires the grantor's own board approval or internal consent, the grantor can effectively veto exercise indefinitely by withholding it — making the put option economically worthless.","Limit conditions precedent to third-party regulatory approvals and add a 'reasonable endeavors' obligation requiring the grantor to actively pursue satisfaction of each condition within a defined deadline.",{"mistake":395,"why_it_matters":396,"fix":397},"No payment security for the exercise price","If the grantor is illiquid or insolvent when the put is exercised, the option holder's only recourse is an unsecured damages claim — often uncollectable against a distressed counterparty.","Negotiate a bank guarantee, standby letter of credit, or escrow funded at signing to secure the grantor's payment obligation before the option is granted.",{"mistake":399,"why_it_matters":400,"fix":401},"Describing the option asset by percentage only","If new shares are issued between signing and exercise, a percentage-only description causes disputes about how many shares are actually covered — with no agreed mechanism to resolve them.","Define the option asset by a fixed number of shares and share class, and include an anti-dilution adjustment clause specifying how the number and exercise price adjust on any dilutive issuance.",{"mistake":403,"why_it_matters":404,"fix":405},"Failing to address what happens if exercise notice is sent but conditions are not satisfied before the option period expires","Without express provisions, courts disagree on whether a timely exercise notice preserves the option holder's rights beyond the option period — leaving the transaction in legal uncertainty.","Add a provision stating that a validly delivered exercise notice within the option period extends the option holder's rights until conditions are satisfied or a long-stop date is reached, whichever is earlier.",[407,410,413,416,419,422,425,428,431],{"question":408,"answer":409},"What is a put option agreement?","A put option agreement is a legally binding contract that gives one party — the option holder — the contractual right, but not the obligation, to sell a defined asset (typically shares or a business interest) to the other party — the grantor — at a predetermined price within a specified time window. The grantor is obligated to buy if the option is exercised; the option holder chooses freely whether to exercise. Put options are used in private equity exits, joint ventures, shareholder buybacks, and real estate co-investments.\n",{"question":411,"answer":412},"What is the difference between a put option and a call option?","A put option gives the holder the right to sell an asset to the grantor. A call option gives the holder the right to buy an asset from the grantor. In shareholder arrangements, a put option protects a selling party (typically a minority investor wanting an exit guarantee), while a call option protects a buying party (typically a majority owner wanting the right to acquire remaining shares). The two are often combined in the same shareholders agreement to create a balanced buy-sell mechanism.\n",{"question":414,"answer":415},"When should I use a put option agreement?","Use a put option agreement when an investor, minority shareholder, or asset co-owner needs a contractual guarantee that they can exit their position at a known price, regardless of market conditions. Common triggers include the close of a funding round where investors receive downside protection, the formation of a joint venture where partners need exit certainty, a phased acquisition where the seller retains a put on unsold shares, and succession or buyout planning for closely-held businesses.\n",{"question":417,"answer":418},"Does a put option agreement need to be in writing?","Yes. In virtually all common-law and civil-law jurisdictions, an option over shares or real property must be in writing to be enforceable. Verbal put option agreements are generally unenforceable because they lack the certainty of terms required for specific performance. A written agreement also creates the documentary evidence needed to enforce the option if the grantor refuses to complete the purchase.\n",{"question":420,"answer":421},"Can a put option agreement be made irrevocable?","Yes — and it should be. Including the word 'irrevocably' in the grant clause prevents the grantor from withdrawing the option before the option period expires. Without express irrevocability, common-law courts in some jurisdictions have found that an option can be withdrawn before exercise if it was not supported by separate consideration. If the put right is the commercial consideration for entering a transaction, expressly state that it is irrevocable and supported by adequate consideration.\n",{"question":423,"answer":424},"What exercise price should I use in a put option agreement?","The exercise price can be a fixed dollar amount per share — offering certainty for both parties — or a formula tied to a financial metric such as EBITDA, revenue, or net asset value at the time of exercise. Fixed prices are simpler and avoid valuation disputes; formula prices are fairer over long option periods when business value may change significantly. Whichever method is used, define every input to the formula precisely and include a dispute resolution mechanism for valuation disagreements.\n",{"question":426,"answer":427},"What happens if the grantor refuses to complete after the option is exercised?","If the grantor refuses to complete after a valid exercise notice, the option holder typically has two remedies: a claim for specific performance — a court order compelling the grantor to complete the purchase — and a claim for damages covering all losses caused by the breach. Specific performance is generally the more valuable remedy because it forces the transaction to close rather than leaving the option holder with a money judgment. Express the right to specific performance in the contract to ensure courts treat it as available without requiring further argument.\n",{"question":429,"answer":430},"Is stamp duty or transfer tax payable when a put option is exercised?","In most jurisdictions, stamp duty or securities transfer tax becomes payable on completion of the share transfer triggered by exercise — not on the grant of the put option itself. In the UK, stamp duty on shares is 0.5% of the exercise price paid. In Canada, provincial securities transfer taxes vary. In the US, federal stamp duty on share transfers was abolished, but some state transfer taxes may apply. Consider consulting a tax adviser before structuring the exercise price, as the tax treatment of gains on exercise also varies by jurisdiction and holding period.\n",{"question":432,"answer":433},"Do I need a lawyer to draft a put option agreement?","For straightforward shareholder put options in a single jurisdiction, a high-quality template reviewed by a lawyer is usually sufficient and cost-effective. Engage a lawyer directly when the option covers a material asset value (above $500K), involves cross-border parties, is part of a complex capital structure with anti-dilution, liquidation preference, or drag-along mechanics, or when the grantor's financial capacity to complete is uncertain. A 2–4 hour legal review of a template typically costs $600–$1,500 and is worthwhile for any option over a significant business interest.\n",[435,439,443,447],{"industry":436,"icon_asset_id":437,"specifics":438},"Private equity and venture capital","industry-fintech","Investors receive put rights as downside protection in preferred share structures, allowing exit at the original investment price or a guaranteed return multiple if a liquidity event does not occur within a defined period.",{"industry":440,"icon_asset_id":441,"specifics":442},"Real estate and property investment","industry-construction","Co-investors use put options to guarantee an exit from a jointly-held property at a fixed price, protecting against illiquidity in thin real estate markets or partnership disputes.",{"industry":444,"icon_asset_id":445,"specifics":446},"Technology and SaaS","industry-saas","Founders and early investors use put options in shareholder agreements to establish exit mechanics before a company reaches the scale required for a trade sale or IPO, providing liquidity certainty in a long-duration asset class.",{"industry":448,"icon_asset_id":449,"specifics":450},"Manufacturing and industrials","industry-manufacturing","Joint venture partners in capital-intensive manufacturing operations use put options to enable exit from the venture without requiring full dissolution, allowing one partner to sell its interest to the other at a predetermined valuation based on plant assets or EBITDA.",[452,456,460,463],{"vs":453,"vs_template_id":454,"summary":455},"Call option agreement","call-option-agreement-D338","A call option gives the holder the right to buy an asset from the grantor; a put option gives the holder the right to sell an asset to the grantor. They protect opposite parties in a transaction — the call protects a buyer wanting acquisition certainty, while the put protects a seller wanting exit certainty. The two instruments are often combined in a single shareholders agreement to create a balanced bilateral exit mechanism.",{"vs":457,"vs_template_id":458,"summary":459},"Share purchase agreement","share-purchase-agreement-D12831","A share purchase agreement documents the immediate, unconditional transfer of shares — both parties are obligated to complete at signing. A put option agreement grants a future right to sell that the option holder may or may not choose to exercise. Use a share purchase agreement when a sale is agreed and proceeding now; use a put option when one party needs a guaranteed future exit right but is not yet committed to selling.",{"vs":461,"vs_template_id":232,"summary":462},"Shareholders agreement","A shareholders agreement governs the ongoing relationship between co-owners of a company — covering voting rights, dividend policy, board composition, and exit provisions including put and call options. A standalone put option agreement contains only the option mechanics and is used when the parties already have or do not need a full governance document, or when the put right is granted to a party who is not otherwise a party to the shareholders agreement.",{"vs":464,"vs_template_id":465,"summary":466},"Buy-sell agreement","buy-sell-agreement-D13085","A buy-sell agreement creates a mutual obligation for owners to buy or sell their interests on defined trigger events — typically death, disability, or departure — at a formula price. A put option agreement is a unilateral right: only the option holder decides whether to exercise. Use a buy-sell agreement for partner succession and continuity planning; use a put option when one specific party needs a guaranteed, voluntary exit right.",{"use_template":468,"template_plus_review":472,"custom_drafted":476},{"best_for":469,"cost":470,"time":471},"Straightforward shareholder put options in a single jurisdiction with an exercise price below $250K","Free","30–45 minutes",{"best_for":473,"cost":474,"time":475},"Options over business interests valued between $250K and $2M, involving cross-border parties or formula-based pricing","$600–$1,500 for a 2–4 hour legal review","3–5 business days",{"best_for":477,"cost":478,"time":479},"Complex capital structures with anti-dilution, liquidation preferences, or multi-party joint ventures involving material asset values above $2M","$3,000–$10,000+","2–4 weeks",[481,486,491,496],{"code":482,"flag_asset_id":483,"name":484,"note":485},"us","flag-us","United States","Put options over shares of US entities are generally enforceable as contracts under state law; New York and Delaware are the most commonly chosen governing law jurisdictions for private equity arrangements. The SEC's regulations on options and securities do not typically apply to private company put options, but the instrument must be carefully structured to avoid classification as a security requiring registration. California courts apply additional scrutiny to provisions that restrict the free transferability of shares.",{"code":487,"flag_asset_id":488,"name":489,"note":490},"ca","flag-ca","Canada","Put options over shares of Canadian corporations are enforceable under provincial contract law; Ontario and British Columbia are the most common governing law choices. Securities law requirements under provincial OSC and equivalent regulator rules generally do not apply to private company put options between sophisticated parties. Quebec civil law applies different formation and enforceability principles — agreements involving Quebec entities should be reviewed by Quebec-qualified counsel, and French-language versions may be required for certain regulated contexts.",{"code":492,"flag_asset_id":493,"name":494,"note":495},"uk","flag-uk","United Kingdom","Put options over shares of UK companies must be in writing and are enforceable under English or Scots contract law. Stamp duty at 0.5% of the consideration is payable on completion of the share transfer triggered by exercise — not on the grant of the option. The Financial Conduct Authority's rules on financial promotions and investment arrangements do not generally apply to private company put options between existing shareholders, but advice should be sought for options involving more than a small number of parties.",{"code":497,"flag_asset_id":498,"name":499,"note":500},"eu","flag-eu","European Union","Put option enforceability varies across EU member states — German, French, and Dutch law each apply different rules on option formation, irrevocability, and the availability of specific performance. In France, the 'promesse unilatérale de vente' (unilateral promise to sell) is the civil law equivalent of a put option and must satisfy specific formality requirements to be enforceable. GDPR considerations may arise if the agreement involves processing personal data of shareholders or beneficial owners. Cross-border EU arrangements should identify a single governing law to avoid conflicts-of-law disputes.",[236,232,240,244,502,503,504,505,506,507,508,509],"non-disclosure-agreement-nda-D12692","term-sheet-D473","investment-agreement-D12831","joint-venture-agreement-D889","letter-of-intent_acquisition-of-business-D5197","stock-purchase-agreement-D349","shareholder-loan-agreement-D13239","asset-purchase-agreement-D928",{"emit_how_to":192,"emit_defined_term":192},{"primary_folder":141,"secondary_folder":512,"document_type":513,"industry":514,"business_stage":515,"tags":516,"confidence":522},"equity-and-mergers","agreement","general","exit",[517,518,519,520,521],"equity","put-option","exit-strategy","share-buyback","financial-instrument",0.92,"\u003Ch2>What is a Put Option Agreement?\u003C/h2>\n\u003Cp>A \u003Cstrong>Put Option Agreement\u003C/strong> is a legally binding contract that grants one party — the option holder — the right, but not the obligation, to sell a defined asset (typically shares, a business interest, or real property) to another party — the grantor — at a pre-agreed price within a specified time window. Unlike a share purchase agreement, which creates an immediate and mutual obligation to transact, a put option is a unilateral instrument: the grantor is bound to purchase if the option is exercised, while the option holder retains complete freedom to decide whether to sell. This asymmetry is the agreement's defining commercial feature — it provides the option holder with a guaranteed exit floor while preserving the choice not to use it if market conditions are more favorable.\u003C/p>\n\u003Ch2>Why You Need This Document\u003C/h2>\n\u003Cp>Without a written put option agreement, an investor or minority shareholder has no enforceable exit right beyond what is provided in the company's constitutional documents — which rarely include a guaranteed buyback at a fixed price. The consequences of this gap are concrete: when a joint venture sours, a funding round stalls, or a majority shareholder refuses to facilitate an exit, the minority party is left negotiating from a position of weakness with no contractual leverage. Courts will not imply a put right from informal assurances or prior conduct. A properly drafted and signed put option agreement changes that position entirely — it creates an obligation the grantor cannot withdraw, specifies an exercise price free from post-hoc renegotiation, and preserves the option holder's right to seek specific performance if the grantor refuses to complete. This template gives you a professionally structured starting point that covers every material term, reducing drafting time and ensuring the critical protections — irrevocability, payment security, and a defined valuation mechanism — are in place before the agreement is signed.\u003C/p>\n",1781186012407]