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A Bill of Sale is a written acknowledgment of the transfer of ownership of property between two parties, where one party is selling specific goods/assets and the other party is purchasing them. It cannot be used to transfer real property or intellectual property. This document in its draft form contains numerous of the standard clauses commonly used in these types of agreements, as well as optional language to allow for customization to ensure the specific terms of the parties’ agreement are addressed. Use of this Bill of Sale ensures that there is a complete, and accurate record of the transfer of the property from the Seller to the Buyer.
Shareholder Buy-Sell Agreement This is an agreement made between shareholders in a corporation that places restrictions on the sale or transfer of each shareholder’s ownership interest in the corporation. As drafted, this agreement contains standard provisions, such as a right of first refusal and a forced sale clause. It also includes opportunities for customization to ensure that the specific needs of the parties are addressed. This agreement is ideal for small businesses that operate as corporations and want to place restrictions on when and how shareholders can sell ownership in the corporation. BUY-SELL AGREEMENT THIS BUY-SELL AGREEMENT (the “Agreement”) entered into this ______ day of ______________, 20__, by and between _____________________ (the “Company”) located at ______________________and __________________ the holders of shares of stock in the Company (the “Shareholders”) collectively referred to herein as the “Parties”. WHEREAS the Company is duly incorporated pursuant to the laws of the State of __________________ and has an authorized capital consisting of _________________ shares [Number of shares authorized to be issued by the Company] (the “Stock”) of which [Number] ____ shares are currently issued and outstanding; WHEREAS each Shareholder presently owns the following shares of: Shareholders Shares [Name of Shareholder] [# of Shares] [Name of Shareholder] [# of Shares] AND WHEREAS the Company and the Shareholders desire to enter into an Agreement which sets out the limitations for the transfer of the shares, the disposition of the Shares upon a Shareholder’s death, and certain other matters. NOW, THEREFORE in consideration of the foregoing and of the mutual promises and covenants contained herein, and other good and valuable consideration, the receipt of which is hereby acknowledged, the Parties hereto agree as follows: I RESTRICTIONS 1.01 No Shareholder of the Company shall transfer, sell, assign, pledged or hypothecate his/her Shares to any other party, whether now owned or hereafter acquired, except as permitted by and in accordance with this Agreement. 1.02 A Shareholder of the Company may transfer his/her Shares to a grantor trust for his/her benefit. 1.03 By the Company’s execution of this Agreement, the Company hereby agrees that it shall not transfer any of the Shares on the books of the Company, unless such transfer of Shares is permitted by the terms of this Agreement and shall not issue any Shares of the Company except in accordance with this Agreement. II RIGHT OF FIRST REFUSAL © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 2 2.01 Any Shareholder who desires to sell all or any of his/her Shares shall give notice of such proposed sale (the "Notice") to the Company and to the other Shareholders and shall set out in the Notice the number and class of his/her Shares that he/she desires to sell (the "Offered Shares") and the terms upon which and the price at which he/she desires to sell the Offered Shares (the "Purchase Price"). 2.02 Upon the Notice being given, the other Shareholders shall have the right to purchase all, but not less than all, of the Offered Shares for the Purchase Price. The other Shareholders shall be entitled to purchase the Offered Shares pro rata based upon the number of Shares beneficially owned by the Shareholder or to purchase in such other proportion as the Shareholders may agree in writing. 2.03 Within ________ (___) business days of having been given the Notice, each Shareholder who desires to purchase all of the Offered Shares that he/she is entitled to purchase shall give notice to the Shareholder, to the Company and to the other Shareholders. If any Shareholder does not give such notice, the Offered Shares that he/she had been entitled to purchase (the "Rejected Shares") may instead be purchased by the Shareholders who did give such notice, pro rata based upon the number of Shares beneficially owned by such Shareholders as between themselves or in such other proportion as such Shareholders may agree in writing, and, within ______ (____) business days of the expiration of the _______ (___) business day period specified in this paragraph. Each Shareholder who desires to purchase all of the Rejected Shares that he/she is entitled to purchase in accordance with the provisions of this paragraph shall give an additional notice to the Shareholder, to the Company and to the other Shareholders. If any Shareholder entitled to give the said additional notice does not do so, the Rejected Shares that he/she had been entitled to purchase may instead be purchased by the Shareholders who did give such notice, and so on from time to time until the Shareholders are willing to purchase all of the Offered Shares or until they are not willing to purchase any more. If the Shareholders are willing to purchase all, but not less than all, of the Offered Shares, the transaction of purchase and sale shall be completed in accordance with the terms set out in the Notice. 2.04 If the Shareholder defaults in transferring the Offered Shares to the Shareholders in accordance with the terms set out in the Notice, the Secretary of the Company or any other authorized officer, is authorized and directed to receive the purchase money and to thereupon cause the names of the Shareholders to be entered in the registers of the Company as the holders of the Shares purchasable by them. Said purchase money shall be held in trust by the Company on behalf of the Shareholder and not commingled with the Company’s assets, except that any interest thereon shall be for the account of the Company. The receipt by the Secretary or any other authorized officer of the Company of the purchase money shall be a good discharge to the Shareholders and, after their names have been entered in the registers of the Company, the validity of the proceedings shall not be subject to question by any person. On such registration, the Shareholder shall cease to have any right to or in respect of the Offered Shares except the right to receive, without interest, the purchase price received by the Secretary, or any other authorized officer of the Company. © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 3 2.05 If the Shareholders do not give notice in accordance with the provisions of paragraph 2.01 that they are willing to purchase all of the Offered Shares, the rights of the Shareholders, subject as hereinafter provided, to purchase the Offered Shares shall forthwith cease and the Shareholder may sell the Offered Shares to any person (“New Buyer”) within _________ (___) months after the expiration of the _______ (___) business day period or ________ (___) business day periods, as the case may be, specified in paragraph 2.03, for a price not less than the Purchase Price and on other terms no more favorable than those set forth in the Notice. Prior to the close of the transaction, the New Buyer shall agree to be bound by this Agreement and to become a party hereto in place of the Shareholder with respect to the Offered Shares. If the Offered Shares are not sold within such __________ (___) month period on such terms, the rights of the Shareholders pursuant to this Article 2 shall again take effect and so on from time to time. III DEATH OR INCAPACITY OF SHAREHOLDER 3.01 In the event that any Shareholder dies, or shall be adjudged mentally incompetent and shall have a legal representative appointed to administer his/her affairs, the Company may at its option redeem or purchase for cancellation within ________________ (____) days of the date of death or such judgment. The Shares of any class registered in the name of such Shareholder may be redeemed or purchased at their fair market value at such date, provided that the Company's rights may only be exercised by written notice delivered to the appropriate party within _________ (____) days of the date of death or judgment. In the event of such notice the Company shall redeem or purchase, and the legal representative shall sell, all of such Shares on the date specified in writing by the Company in its notice. If the notice fails to specify a date, the purchase and sale shall be completed on the __________ (______) day following the date of death or such judgment, as the case may be. 3.02 The purchase price for such Shares shall be paid in full by cash or by certified check or bank draft at the time of closing, or, if the Company so elects, shall be payable as to __________ (_____%) per cent thereof by cash or on such other terms as the Parties may agree. 3.03 The Board of Directors shall determine at its sole discretion whether and upon what terms to purchase contracts of life insurance insuring the lives of the Shareholders, or one or more of them, for the purpose of providing funds for the purchase of their Shares in accordance with this Article III. If the Company exercises its option to purchase the Shares of a Shareholder who has died, then any proceeds so obtained by the Company from such life insurance contracts upon the death of such Shareholder shall be used by the Company to purchase, in whole or in part as such proceeds may be available, the Shares owned by such Shareholder and any balance of such proceeds shall be retained for the sole benefit of the Company. 3.04 In the event that there are no life insurance proceeds payable to the Company upon the death of any Shareholder, the Company may, at its sole option, elect to assign to the remaining Shareholders its option to purchase the Shares registered in the name of such © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 4 Shareholder upon the same terms and conditions as specified in paragraphs 3.02 and 3.03 hereof. If one or more of the remaining Shareholders wish to exercise the option to purchase so assigned to the remaining Shareholders, such Shares shall be purchased by such Shareholders in such proportions as they shall in their sole discretion determine. IV BANKRUPTCY OR OTHER INVOLUNTARY TRANSFER 4.01 In the event of the bankruptcy of any Shareholder or of the transfer, voluntary or involuntary, by any Shareholder of any of his Shares to any creditor in total or partial satisfaction of any debt, obligation, judgment or other liability (any trustee or receiver of such Shareholder's assets or any such creditor being herein called the "involuntary transferee", the bankrupt Shareholder or the Shareholder whose interest passes to the involuntary transferee being herein called the "debtor party"), the Company shall have the option to purchase all but not less than all of the Shares of the debtor party by giving written notice of its election to purchase the same within _______ (____) days after such bankruptcy shall have been adjudicated or such transfer shall have occurred at a price equal to ___________ (____%) per cent of the fair market value of such Shares. 4.02 The purchase price for the Shares of the debtor party shall be paid within _________ (_____) days after the delivery of notice pursuant to paragraph 2.01 hereof by the Company. Upon receipt of such consideration, the involuntary transferee shall execute and deliver whatever instruments of conveyance, assignment and release shall be necessary to carry out such sale and if he/she shall fail or refuse to do so, the Secretary or any other duly appointed officer of the Company is irrevocably constituted and appointed the attorney of the debtor party to effect such execution. 4.03 The Company may, at its sole option, elect to assign to the remaining Shareholders its option to purchase the Shares from the involuntary transferee upon the same terms and conditions as specified in paragraphs 4.01 and 4.02 hereof. If one or more of the remaining Shareholders wish to exercise the option to purchase so assigned to the remaining Shareholders, such Shares shall be purchased by such Shareholders in such proportion as they shall in their sole discretion determine. V GENERAL PROVISIONS REGARDING PURCHASE AND SALE 5.01 In the event of the sale by any Shareholder or his/her legal representative (collectively, the "Selling Shareholder") of his/her Shares pursuant to the provisions of this Agreement: (a) if the Shares to be sold are all of the Shares then held by the Selling Shareholder, the Company shall use its best efforts to obtain a release from the Selling Shareholder from any guarantees and covenants which he/she has given on behalf © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 5 of the Company and shall indemnify the Selling Shareholder with respect to any claims for which such a release cannot be obtained; (b) if the Shares to be sold are all of the Shares then held by the Selling Shareholder, the Selling Shareholder shall deliver a release from any and all claims which he/she may have against the Company or the remaining Shareholders; (c) certificates representing the Shares to be sold shall be delivered to the purchaser duly endorsed in blank for transfer, and the Selling Shareholder shall also deliver to the purchaser original executed copies of all documents as may be required to effect the transfer including, without limitation, succession duty releases, letters of probate and declarations of transmission, and shall deliver to the Company a certified check representing payment in full of all amounts owed by the Selling Shareholder to the Company, all against delivery to the Selling Shareholder of the checks described in sub-paragraph (e) hereof; (d) such sale shall be on terms whereby the Selling Shareholder warrants that: (i) he/she has good marketable title to the Shares to be sold free from any option or refusal right, voting trust, pledge, hypothecation, mortgage, lien, charge, encumbrance, security interest or other right or interest of any other person other than by or pursuant to this Agreement; and (ii) he/she has full power and authority to complete, and is otherwise fully entitled to complete, the sale; and (e) the purchaser shall deliver to the Selling Shareholder by cash, certified check or bank draft the purchase price and the Company shall deliver to the Selling Shareholder a certified check for all amounts owing by the Company to the Selling Shareholder. 5.02 In no event shall any purchaser be entitled to or obliged to purchase a fraction of a share. In order to eliminate fractions, the Secretary or any other duly authorized officer of the Company shall make such minimum alterations to the number of Shares agreed to be purchased as may be required to eliminate such fractions and his decision shall be final and binding upon all Parties. 5.03 In the event that a Selling Shareholder shall fail to comply with the provisions of sub-paragraph 5.01(c) hereof, and all conditions of such paragraph to be met by the purchaser and the remaining Shareholders shall have been met, the Selling Shareholder hereby irrevocably appoints the Secretary or any other authorized officer of the Company his/her attorney to effect the transfer of the Shares to be sold on the books of the Company. VI MANDATORY SALE © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 6 6.01 In the event that a bona fide offer to purchase shares is received by any Shareholder from a third party dealing at arm's length with all Shareholders, which offer is conditional upon the acquisition by that third party of all of the issued and outstanding Shares upon the same terms and conditions and which offer the holders of at least ___________ (____%) per cent of the then issued and outstanding _________ Shares desire to accept, each Shareholder shall be obliged to accept such offer and shall forthwith take all such actions and execute all such further agreement or instruments as may be necessary or in the opinion of the attorneys for the Company, acting reasonably, desirable in order to complete the purchase and sale resulting from the acceptance of that offer. VII VALUATION 7.01 For the purposes of any transaction of purchase and sale contemplated herein and expressed to occur at fair market value, the Parties to such transaction shall, within _______ (____) days of the events giving rise to the transaction but in any event prior to the date set for the closing of the subject transaction, make their joint determination of the fair market value of the Shares which are the subject of the transaction. This valuation shall be based on the most current financial information for the Company, the contracts entered into by the Company, the markets and marketability of the Company as a whole and any other factors relevant to such valuation. In the event that the Parties to the subject transaction are able to make such a joint determination, then such value shall be binding upon them for the purposes of that transaction only and shall have no bearing on any other transaction or upon any other Parties hereto. 7.02 If the Parties to the subject transaction are unable to make a joint determination of the fair market value of the Shares subject to the transaction within the time so provided in paragraph 7.01 hereof, an independent business valuator to be agreed upon by the Parties to the subject transaction shall determine the fair market value of all of the issued and outstanding Shares in the capital of the Company as at the last day of the month in which the event giving rise to the transaction of purchase and sale occurs. If the Parties to the transaction fail to choose an independent business valuator within thirty (30) days following the said event, then such business valuator shall be chosen by a Judge of the applicable jurisdiction upon the application of either of the Parties to the transaction. The determination of the fair market value of all of the issued and outstanding Shares in the capital of the Company made by the independent business valuator shall, for the purposes of this Agreement, be binding and effective upon the Parties to the subject transaction only and shall not be binding on any other transaction or upon any other Parties hereto. In arriving at such valuation, the valuator shall take into account and apply generally accepted accounting and valuation principles. The valuator shall value the Company as a going concern but shall not apply any discount or premium for a minority or majority interest, as the case may be, and shall not include as an asset of the Company the proceeds of any insurance policies payable on the death of a Shareholder. Additionally, if the event in question is the death of a Shareholder, the valuator shall not have regard to the occurrence of the death of the deceased or the imminent possibility thereof. The valuation arrived at by the valuator, made © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 7 as an expert and not as umpire or arbitrator, shall be final and binding and no appeal shall lie therefrom. VIII DISPUTE RESOLUTION 8.01 The Parties shall endeavor to resolve any differences of opinion which may arise between them with respect to the provisions of this Agreement by negotiation between themselves personally or with the assistance of their attorneys and unless in the opinion of any party, acting reasonably, the matter in dispute is of such a significant nature to warrant it being addressed otherwise, no party shall commence any public proceedings until the negotiations have failed to produce a resolution. In furtherance of the provisions of this paragraph, all Parties hereby agree to make themselves available on short notice and to negotiate promptly and in good faith, any matter any party may wish to negotiate. 8.02 The Parties agree to obtain the assistance of a mediator should any party be of the opinion that the assistance of a mediator would assist in an expeditious and amicable resolution of the matter in dispute. The costs of any such mediator shall be shared equally by all of the Parties involved in the dispute. 8.03 If negotiations are conducted with the assistance of a mediator and no agreement is reached, the mediator shall be instructed to proffer no opinion as to the position maintained by any party and to make no report unless directed to do otherwise, in writing, by all of the Parties. 8.04 The Parties hereto agree that no report of anything said or of any admission or communication made in the course of the negotiations or mediation hereinbefore described shall be used as evidence or shall otherwise be admissible in any legal proceeding, except with the consent, in writing, of all of the Parties. 8.05 If in the opinion of any party, acting reasonably, it is unlikely to expect the matter in dispute as between the Parties to be resolved by continued negotiations or continued mediation as hereinbefore provided, or if the matter is of such a significant nature to warrant it being addressed otherwise, as provided in paragraph 15.01 hereof, then the matter in dispute shall be submitted to and shall be subjected to arbitration pursuant to [the Parties should decide on a local arbitration panel, or arbitration may be conducted under the rules of the American Arbitration Association], as amended, as hereinafter provided. 8.06 Any arbitration to be carried out pursuant to the terms of paragraph 8.05 shall be subject to the following provisions, namely: (a) the party desiring arbitration shall nominate one arbitrator and shall notify the other Parties of such nomination. Such other Parties shall within ten (10) days after receiving such notice, nominate an arbitrator and the two arbitrators shall select a chairman of the arbitral tribunal to act jointly with them. If the arbitrators shall be unable to agree in the selection of such chairman, the chairman shall be © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 8 designated by a Judge of the applicable jurisdiction upon an application by any party; (b) the arbitration shall take place in the City of ______________ and the chairman or any other authorized officer of the Company shall fix the time and place in the City of _______________ for the purpose of hearing such evidence and representations as any of the Parties may present and, subject to the provisions hereof, the decision of the arbitrators and chairman or any authorized officer of the Company or any two of them, in writing, shall be binding upon the Parties both in respect of procedure and the conduct of the Parties during the proceedings and the final determination of the issues therein. The arbitrators and the chairman or any authorized officer of the Company shall, after hearing any evidence and representations that the Parties may submit, make their decision and reduce the same to writing and deliver one copy thereof to all of the Parties hereto. The majority of the chairman or any other authorized officer of the Company and arbitrators may determine any matter of procedure for the arbitration not specified herein; (c) if the Parties hereto receiving the notice of the nomination of any arbitrator by the party desiring arbitration fail within the said ten (10) days to nominate an arbitrator, then an arbitrator shall be nominated on their behalf by a Judge of the applicable jurisdiction upon an application by any such party within ten (10) days thereafter, failing which, the arbitrator nominated by the party desiring arbitration may proceed alone to determine the dispute in such manner and at such time as he shall think fit and his decision shall, subject to the provisions hereof, be binding upon the Parties; (d) notwithstanding the foregoing, any arbitration may be carried out by a single arbitrator if the Parties hereto so agree, in which event the provisions of this Article shall be modified accordingly; and (e) the cost of the arbitration shall be borne in accordance with the decision of the arbitrators. 8.07 The Parties to any such transaction of purchase and sale shall be individually responsible for their own legal fees incurred but shall be jointly responsible for all costs associated with the calculation of fair market value by the independent business valuator, as hereinbefore provided. IX INDEPENDENT LEGAL ADVICE 9.01 Each of the Shareholders hereby acknowledges that, prior to executing this Agreement, they have been advised to and have had the opportunity to obtain independent legal advice and that: © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 9 (a) they have in fact obtained independent legal advice signed by their attorney and attached hereto as Schedule "A", that all the statements made in said letter are true and correct, that none of the other Parties hereto, or any of their employees, agents or officers have used any compulsion or made any threat or exercised any undue influence to induce them to take the action mentioned in said letter and that their attorney, the writer of said letter, in advising them as stated therein, was consulted by them as their personal attorney and in their interests only; or (b) upon consideration and of their own free will and volition they have determined that they do not require independent legal advice, that they understand fully the nature and consequences of executing this Agreement and that none of the other Parties hereto, or any of their employees, agents or officers have used any compulsion or made any threat or exercised any undue influence to induce them to execute this Agreement and by virtue of the fact that any Shareholder shall not have obtained and attached hereto a letter of independent legal advice, such Shareholder shall be conclusively deemed to be in agreement with and bound by this sub-paragraph 9.01 (b). X GENERAL 10.01 This Agreement constitutes the entire agreement between the Parties hereto with respect to the specific subject matter hereof and supersedes all prior agreements or understandings of any kind with respect to the specific subject matter hereof. 10.02 Any notice or other communication under or for the purposes of this Agreement shall be given or made in writing, marked Private and Confidential, and shall be served personally or by courier or mailed by prepaid registered mail: (a) in the case of the Company, to: Fax: (___) (b) in the case of any Shareholder, to the last known address of that Shareholder as recorded in the records of the Company, or to such other address as any of the Parties shall have last notified in the manner provided herein. The date of receipt of any such notice or other communication shall be deemed to be the date of delivery of such notice or other communication if served personally or by courier © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 10 (provided, however, that no notice or other communication shall be delivered by courier to a residential address), or if mailed as aforesaid, the fourth day of business following the date of mailing, provided that no day on which there is an interruption of postal service which would affect such mailing shall be a day for determining whether effective notice has been given. [Instruction: If notice by facsimile or email is acceptable to the Parties, indicate that in this paragraph and add an email address line where appropriate] 10.03 This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and such counterparts together shall constitute one agreement deemed to be dated as of the date hereof. 10.04 To the extent necessary to implement the provisions of this Agreement the power of the Board of Directors of the Company to manage or supervise the management of the business and affairs of the Company is hereby restricted. 10.05 Subject to the provisions hereof, this Agreement may not be assigned, in whole or in part, without the prior approval of all Parties hereto. Subject thereto, this Agreement shall inure to the benefit of and shall be binding upon the Parties hereto and their respective successors, heirs, executors, administrators, other personal and legal representatives (including trustees and receivers in bankruptcy) and permitted assigns. 10.06 The term of this Agreement shall commence on the date hereof and continue in full force and effect until there is only one holder of Shares of record or until terminated by agreement of the holders of all of the then issued and outstanding Shares. This Agreement may only be amended by the agreement of the holders of at least __________ per cent (____%) of the then issued and outstanding Shares. 10.07 The Parties shall sign such further and other documents, cause such meetings to be held, resolutions passed and by-laws enacted, exercise their vote and influence, do and perform and cause to be done and performed such further and other acts and things as may be necessary or desirable in order to give full force and effect to this Agreement and every part hereof. 10.08 Time shall be of the essence of this Agreement and of every part hereof and no extension or variation of this Agreement shall operate as a waiver of this provision. 10.09 Each Shareholder acknowledges receiving and reading a copy of this Agreement prior to its execution and acknowledges that he/she has had an opportunity to seek independent legal advice prior to its execution. Each Shareholder acknowledges that he/she understands fully the nature and effect of this Agreement and that he has executed this Agreement of his/her own free will and volition and under no compulsion to act. IN WITNESS WHEREOF the Parties have duly executed this Agreement under their hands and seals as of the day and year first written above. © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 11 (COMPANY) Name: Title: SIGNED, SEALED AND DELIVERED ) in the presence of: ) ) ) _________________________________ ) __________________________________ Witness ) Shareholder ) ) _________________________________ ) __________________________________ Witness ) Shareholder © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 12 SCHEDULE “A” CERTIFICATE OF INDEPENDENT LEGAL ADVICE © Copyright 2014 Docstoc Inc. registered document proprietary, copy not 13
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