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Share Repurchase Program Agreement

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SHARE REPURCHASE PROGRAM AGREEMENT

This Share Repurchase Program Agreement (Agreement) is entered into as of Effective Date: by and between Company Name: and Shareholder Name: .

RECITALS

WHEREAS, the board of directors of the Company has authorized a program pursuant to which the Company may repurchase issued and outstanding shares of its common stock (the Shares) on the terms and subject to the conditions set forth in this Agreement; and

WHEREAS, the Company and the Shareholder wish to set forth the terms under which Shares may be repurchased by the Company from or on behalf of Shareholder and the procedures for such repurchases.

1. DEFINITIONS

For purposes of this Agreement, the following terms shall have the meanings set forth below:

"Repurchase Program" means the program described in this Agreement authorizing repurchases of Shares by the Company.

"Repurchase Agent" means the entity designated by the Company to effect repurchases in accordance with this Agreement. Repurchase Agent Name:

2. AUTHORIZATION; PROGRAM PARAMETERS

The Company is authorized to repurchase up to: Shares, subject to the aggregate purchase limit of $ .

Repurchases authorized under this Agreement shall occur during the Repurchase Period beginning on and ending on , unless earlier terminated in accordance with Section 8.

3. METHOD OF REPURCHASES

Repurchases may be effected by one or more of the following methods (check all that apply):

Open-market purchases on applicable exchanges or by private negotiation. Tender offer made to holders of Shares. Negotiated purchases with specific shareholders.

Price per Share shall be determined as follows (select or describe): Fixed Price Range $ to $ ; or Formula / Description:

4. SETTLEMENT, PAYMENT AND FUNDING

Payment for repurchased Shares shall be made in cash by wire transfer or check as agreed between the Company and the Shareholder. Payment terms (e.g., settlement period in Business Days):

The Company shall be entitled to deduct or withhold amounts required under applicable tax law from any payment to the Shareholder. Shareholder Tax Identification Number:

5. CONDITIONS PRECEDENT

The obligations of the Company to repurchase Shares under this Agreement are subject to compliance with applicable law, the rules of any national securities exchange on which the Shares trade, the absence of any material adverse change in the Company's business, and satisfaction of any regulatory approvals. The Company will not effect repurchases if such purchases would violate law or Exchange rules.

6. REPRESENTATIONS AND WARRANTIES

Shareholder represents and warrants that: (a) Shareholder is the beneficial owner of the Shares and has good and marketable title free of liens and encumbrances; (b) Shareholder has full power and authority to enter into this Agreement and to sell the Shares; and (c) the execution, delivery and performance of this Agreement will not conflict with any other agreement or legal restriction binding on the Shareholder.

The Company represents and warrants that it has the corporate power and authority to enter into this Agreement and effect repurchases in accordance with this Agreement and that such repurchases will be made in conformity with applicable laws and the Company's governing documents.

7. COMPLIANCE AND RESTRICTIONS

Shareholder acknowledges that repurchases may be subject to insider trading policies, blackout periods and other restrictions. Shareholder shall not tender Shares or accept payment in violation of any applicable securities laws, regulations or Company policies.

8. AMENDMENT, SUSPENSION AND TERMINATION

The Company may amend, suspend or terminate the Repurchase Program at any time in its discretion. Any material amendment or termination shall be effective upon notice to the Shareholder in accordance with the Notices provision below, unless otherwise required by law.

9. INDEMNIFICATION

Each party shall indemnify, defend and hold harmless the other party and its officers, directors, employees and agents from and against any losses, damages, liabilities or expenses (including reasonable attorneys' fees) arising out of any breach of this Agreement by the indemnifying party or any misrepresentation or warranty made by such party herein.

10. NOTICES

All notices under this Agreement shall be in writing and delivered to the addresses below:

11. GOVERNING LAW; ENFORCEMENT

This Agreement shall be governed by and construed in accordance with the laws of the state of , without regard to conflicts of law principles. Each party submits to the exclusive jurisdiction of the state and federal courts located in such state for any dispute arising under this Agreement.

12. MISCELLANEOUS

This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, whether written or oral. No waiver or modification shall be effective unless in writing signed by both parties. If any provision of this Agreement is held invalid, the remaining provisions shall remain in full force and effect.

REPRESENTATIONS OF AUTHORITY

Each person executing this Agreement on behalf of a party represents and warrants that he or she is duly authorized to execute this Agreement on behalf of such party and that this Agreement constitutes a valid and binding obligation of such party enforceable in accordance with its terms.

Company:

Printed Name:

Title:

By:

Date:

Shareholder:

Printed Name:

Capacity (if not individual):

By:

Date:

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What a Share Repurchase Program Agreement Is and When It Applies

A Share Repurchase Program Agreement documents a company’s plan to buy back its own shares from holders under defined terms. It typically describes authorized repurchase methods (open market, tender offer), the maximum number of shares or dollar amount, governance approvals, funding source, and any shareholder or regulatory conditions. The agreement records the board and shareholder approvals required under state corporate law, sets timelines for offers or purchases, and allocates responsibilities for tax reporting, recordkeeping, and disclosure obligations.

Why a Formal Repurchase Agreement Matters

A written agreement clarifies authority, pricing, timing, and compliance obligations, reducing legal and tax risk while documenting corporate approvals required by state law and securities rules.

Why a Formal Repurchase Agreement Matters

Who Typically Prepares and Signs This Agreement

Common internal and external parties involved in executing a repurchase program include corporate officers, legal counsel, and share transfer agents.

  • Corporate Legal Team: Drafts terms, confirms compliance with corporate statutes and securities laws, and prepares board resolutions and disclosures.
  • Chief Financial Officer: Validates funding availability, accounting treatment, and tax implications for the repurchase.
  • Transfer Agent / Broker: Manages share settlement, ledger updates, and distribution of consideration to selling shareholders.

External advisors such as counsel and tax advisors often review the final agreement; signatories must match delegated authority in corporate records.

Core Components to Include in a Professional Agreement

A thorough agreement balances corporate governance, operational detail, and legal protections; include clear definitions and fallback procedures for common contingencies.

Authorization

State the board resolution or shareholder vote authorizing the repurchase, cite the corporate charter provision, and specify the effective period and limits on amount or shares.

Repurchase Mechanics

Describe purchase methods (open market, tender offer, negotiated purchases), execution timeline, settlement terms, and brokerage or transfer agent instructions for processing trades.

Price and Consideration

Define purchase price formula or fixed price, adjustments for fractional shares, cash versus other consideration, and procedures for disputed price calculations.

Funding Source

Identify the source of funds (available cash, credit facility), attach board evidence of solvency if required, and include any banking or covenant conditions.

Compliance and Disclosures

Allocate responsibility for SEC or state securities filings, insider trading compliance, insider reporting, and public disclosures where applicable.

Termination and Amendments

Specify termination triggers, amendment procedures, notice requirements, and how outstanding offers or transactions are handled on termination.

Step-by-Step: Prepare and Execute the Agreement

Follow a clear sequence from internal approvals to execution and record updates to ensure compliance and accurate accounting.

  • 01
    Board Approval: Obtain a board resolution authorizing the repurchase program with defined limits.
  • 02
    Draft Agreement: Prepare the agreement reflecting method, amount, funding, and required approvals.
  • 03
    Signatures: Collect authorized signatures and any required attestations or officer certificates.
  • 04
    Recordkeeping: Update stock ledger, inform transfer agent, and retain execution copies for compliance.

How to Configure an Online Repurchase Workflow

Set up document routing, signer roles, and authentication to match corporate approval pathways while preserving an audit trail.

Field Configuration
Signer Roles Assign roles: Board Rep, CFO, Corporate Secretary.
Authentication Use email plus two-factor for sensitive signers.
Conditional Fields Show funding clauses only if external financing selected.
Audit Trail Options Enable full event logging and PDF certificate.

Digital Signing and Platform Considerations

Choose an eSignature provider that supports secure authentication, audit trails, and archive exports for regulatory review.

  • Authentication: Email plus SMS or SSO recommended.
  • Audit Trail: Include IP, timestamp, and action log.
  • File Formats: Save final agreement as PDF/A for records.

Ensure the provider offers ESIGN and UETA compliance, optional HIPAA or 21 CFR Part 11 support if your industry requires these certifications, and ability to retain signed copies securely.

Typical Execution Flow for eSigned Repurchase Agreements

A consistent electronic workflow reduces processing time and preserves evidence needed for audits or regulatory review.

  • Upload Document: Sender uploads final agreement template to the platform.
  • Place Fields: Add signature, date, and role-specific fields.
  • Add Signers: Enter signer emails and set signing order if required.
  • Send and Record: Send invites, capture signatures, and store the audit trail.

Essential Information to Capture in the Agreement

Company Name: Full legal name
Authorized Amount: Dollar limit or share count
Repurchase Method: Open market/tender/negotiated
Effective Date: MM/DD/YYYY format
Signatory: Name and corporate title
Funding Source: Cash, credit, or other

Key Risks and Potential Legal Consequences

Breach of Corporate Law: State law violations can void purchases
Securities Violations: Insider trading or disclosure failures
Tax Misreporting: Incorrect forms lead to penalties
Contractual Disputes: Ambiguous terms cause litigation
Authority Defect: Unauthorized signers may invalidate action
Recordkeeping Failures: Missing records impede audits

Common Preparation Pitfalls to Avoid

  • Failing to confirm whether state corporate law requires shareholder approval can nullify repurchase authority and trigger litigation or regulatory scrutiny.
  • Using vague pricing language such as "market price" without a defined formula can produce disputes about consideration and valuation methods.
  • Neglecting to update the stock ledger and transfer agent records promptly can cause settlement failures and claims by sellers.
  • Omitting tax reporting responsibilities or TIN verification for selling shareholders can lead to backup withholding and IRS penalties for the company.

eSignature Pricing and Feature Comparison Relevant to Repurchase Documents

Compare provider pricing, bulk capabilities, and regulatory support when choosing an eSignature platform for repurchase program execution and recordkeeping.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial Varies Varies Varies Varies
Bulk Send Yes (Business Premium) Varies Varies Varies Varies
Audit Trail Yes Yes Yes Yes Yes
Envelope Cap No cap 100 envelopes/user/year Varies Varies Varies

Timing Considerations and Common Deadlines

Track internal and external deadlines from board approval through settlement, disclosure, and tax reporting to remain compliant and avoid penalties.

Board Approval Date:

Date of resolution authorizing the repurchase

Offer Period:

Start and end dates specified in tender offers

Settlement Date:

Date purchases are paid and shares retired or reissued

Tax Reporting:

Complete any required tax forms promptly after transactions

Record Updates:

Update stock ledger and transfer agent within standard settlement time

Practical Tips for Accurate, Efficient Agreement Completion

Adopt standard controls and documentation practices to minimize risk and speed execution.

Pre-approve Templates and Clauses
Maintain board-approved template clauses for common repurchase scenarios so legal review is limited to exceptions, reducing external counsel hours while ensuring consistent legal language and governance compliance.
Verify Signatory Authority Before Sending
Confirm delegated signing authority against corporate records and board minutes to avoid unauthorized signatures, which can invalidate repurchases and expose officers to liability; document the authority in the file.
Use Strong Signer Authentication
Require multi-factor authentication or SSO for officers and financial signers to reduce fraud risk and strengthen the evidentiary value of electronic signatures in regulatory or judicial reviews.
Retain Complete Audit Trails
Store signed PDFs plus the platform audit certificate and any A/V notarization records; ensure the storage solution supports export in ISO-compatible formats for long-term accessibility and legal preservation.

Example Use Cases That Illustrate Practical Application

Two representative scenarios show how a formal agreement supports governance, settlement, and reporting.

Small-Cap Open Market Program

A board authorizes a $2 million open-market repurchase to manage dilution and improve capital structure

  • Execution uses daily brokerage purchases under preset limits
  • The agreement documents funding, trading limits, and recordkeeping processes to support audit and shareholder inquiries.

Private Tender Offer

A privately held company offers to buy minority shares from consenting holders at a fixed price per share

  • The agreement defines eligibility, offer window, and settlement mechanics
  • Clear procedures for share transfer, tax reporting, and escrow settlement prevent disputes and ensure timely ledger updates.

Typical Signatory Roles and Responsibilities

Corporate Secretary

Maintains corporate records, prepares the executed agreement for the minutes, updates the stock ledger, and certifies that signatures and approvals match recorded delegations.

Chief Financial Officer

Confirms availability of funds, coordinates with the treasury and transfer agent for settlement, and records accounting entries related to repurchases and retirement of shares.

Frequently Asked Questions About Share Repurchase Agreements

Answers to common questions address legality of e-signatures, notarization, authority, tax reporting, and cancellation procedures.


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