What is a share buyback agreement?
When a shareholder wants out and the remaining owners do not want to buy personally, the company itself can often buy the shares back. Company law treats this differently from an ordinary share sale. There are usually rules about where the money comes from, which approvals are needed and what filings follow, and the shares are normally cancelled afterwards rather than passed to someone else.
This template records the shares being bought and whether that is the shareholder's whole holding, a price per share and in total, and payment on completion or by instalments where the law allows. Completion depends on the approvals you list, such as a board resolution, a shareholder vote or a solvency statement. It covers what each side hands over on the day, the shareholder's promise of clean title, and whether the shares are cancelled or held in treasury.
- Best for
- Private companies buying out one shareholder
- Signed by
- The company and the selling shareholder
- After completion
- Shares cancelled, or held in treasury where allowed
- Length
- About 2 to 3 pages, initialled on every page
When to use a share buyback agreement
- Buying back a departing co-founder's shares after they leave the business
- Repurchasing shares from an employee who has left
- Giving an early angel investor an exit without bringing in a new shareholder
- Tidying up the cap table by buying out a small minority holder
- Settling the estate of a deceased shareholder who held shares in the family company
What you fill in
17 blanks, then the name and email of each person who signs: company, selling shareholder.
1 The parties
- Date of this agreement*
- Company*
- Company or registration number
- Company address
- Selling shareholder*
- Shareholder address
2 The shares
- Shares bought back*
- Is this all of the shareholder's shares?* Yes · No
3 The price
- Currency*
- Price per share
- Total price*
- How the price is paid* in full on completion, by bank transfer · in the instalments set out below
- Instalment schedule
4 Approvals and completion
- Completion date*
- Approvals and steps required first*
- After completion the shares are* cancelled · held by the Company as treasury shares, where the law allows
- Governing law*
5 Who signs
- Company signature and date, job title, initials on every page · Signed by a director or officer authorised by the board.
- Selling shareholder signature and date, initials on every page
What the share buyback agreement covers
- The buyback
- Price
- Approvals
- Completion
- The Shareholder's promises
- General
Using the share buyback agreement, step by step
1 Identify the company and shareholder
Enter the company and its registration number, and the shareholder selling. Say whether this is their whole holding or only part of it.
2 Set the price
Enter the total and, if you like, the price per share. Choose payment in full on completion or instalments, but check first that instalments are allowed where you are.
3 List approvals and completion
Describe the resolutions and other legal steps needed, the completion date, and whether the shares will be cancelled or held as treasury shares.
4 Sign and file
The company's authorised signer and the shareholder both sign and initial every page. Keep the signed agreement in your vault with the board resolution and the registry filings.
Tips before you send it
- Many countries let a company buy back shares only out of distributable profits or after a solvency test. Ask an accountant before agreeing a price.
- Some jurisdictions require the buyback contract to be approved by shareholders before it is signed or before completion. Sort out the order of steps first.
- Check the articles or shareholders' agreement for leaver provisions that may fix the price for a departing founder or employee.
- Diary any registry filing deadline that follows the buyback. Late filing often brings penalties.
Sign it online in minutes
- Fill in the blanks. Names, dates and amounts go straight into the agreement — the preview shows exactly where.
- Name who signs. Tick “This is me” for your own part. FileIt builds the PDF with every signature, date and initials box on the right line, and you can check or move anything before sending.
- Send it. Each signer gets a secure link and signs from any device — no account needed. The signed PDF, with an audit trail and a Certificate of Completion, is filed in your vault and emailed to everyone.
Share buyback agreement: frequently asked questions
How is a buyback different from selling shares to another shareholder?
In a buyback the company is the buyer and pays out of its own funds, and the shares are usually cancelled. In a share sale another person buys them and becomes the holder. The legal rules and tax treatment can differ, so check which suits you.
Can the company pay in instalments?
In some places yes, in others a company must pay for its own shares in full at the time. The template allows instalments but tells you to check first.
What happens to the shares afterwards?
You choose. They are cancelled, which reduces the company's issued shares, or held by the company as treasury shares where the law allows it.
Does the board need to approve the buyback?
Almost always, and often the shareholders too. List the approvals in the template. Completion only happens once they are in place.