Sample Bylaws provision for California law corporation

shares, ownership, and transfer.

Notwithstanding any provisions of these Bylaws to the contrary, the following restrictions shall apply to the ownership of shares of the corporation.

(a) the Shares of this professional corporation may be issued only to the issuing corporation or to a licensed person practicing in the profession of the issuing corporation.

(b) the Shares of the corporation owned by a person who (i) dies, (ii) ceases to be an eligible shareholder, or (iii) becomes a disqualified person as defined in Section 13401(e) of the California Corporations Code, for a period exceeding ninety (90) days, shall be sold and transferred to the corporation, its shareholders, or to a person licensed to practice the same profession in the jurisdiction or jurisdictions in which the person practices, on such terms as are agreed upon by the corporation and its shareholders. Such sale or transfer shall occur not later than six (6) months after any such death and not later than ninety (90) days after the date the shareholder ceases to be an eligible shareholder, or ninety (90) days after the date the shareholder becomes a disqualified person. Such shareholder shall have no voting or other rights from and after the date of death or disqualification or termination of eligibility, except the right to receive payment for such shares in accordance with the agreement of sale. The income of the corporation attributable to the practice of the profession of the issuing corporation while a shareholder is a disqualified person shall not in any manner accrue to the benefit of such shareholder or his shares.