To alleviate concerns over the continued control over closely held companies, shareholders often enter into a Stock Restriction and Purchase Agreement, thereby restricting lifetime transfers. Such agreements often require that a shareholder interested in selling his or her shares, or the estate of a deceased shareholder, sell his, her, or its shares in the company only to the company or to the other existing shareholders of the company.

Another variation is to allow the selling shareholder, or an estate, the opportunity to sell shares to a third party only after the company and the non-selling shareholders have first declined to acquire such shares. In addition, a Stock Restriction and Purchase Agreement can be helpful in assuring that the shareholders receive the fair value of their labor.

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