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Stock Purchase Agreement for closely held Company

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Legal Documents - William M. Keever

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									                               STOCK PURCHASE AGREEMENT

                THIS AGREEMENT, made and entered into effective as of the ____ day of October,

2005 (the “Effective Date”), by and between _____________________________, a [corporation,

company, partnership] organized and existing under the laws of the State of ________ (hereinafter

referred to as the "Buyer") _________________________, a [corporation, company, partnership]

organized and existing under the laws of the State of ________ (hereinafter referred to as the

“Company”), ______________________________, an individual residing in the State of

______________ (hereinafter referred to as the “Seller”), and _______________________, an

individual residing in the State of _____________ (hereinafter collectively referred to with

___________________ as the “Shareholder” or “Shareholders”), as follows:

                                        W I T N E S S E T H:

                WHEREAS, Seller owns ___________________ (____) shares of the issued and

outstanding common [stock, units or membership interest] in the Company, constituting a total of

_________ Percent (____%) of the total issued and outstanding equity interests of the Company, as

is described on the attached Exhibit "A (the “Stock”) (hereinafter referred to collectively as the

“Stock”);

                WHEREAS, Seller desires to sell to the Buyer and Buyer desires to purchase from

Seller all of the Stock as reflected on Exhibit "A"; and

                WHEREAS, the Shareholders each desire and do consent and approve the sale of

Seller’s Stock to the Buyer.

                NOW, THEREFORE, in consideration of the premises and the mutual covenants

hereinafter set forth, faithfully to be kept by the parties hereto, it is agreed as follows:
               1.      Sale to Buyer. Simultaneously with the execution of this Agreement, Seller

does hereby bargain, sell, transfer, assign and surrender for purchase to the Buyer all of the Stock

owned by Seller, constituting a total of ____________ (____%) of all of the outstanding and issued

equity in the Company.

               2.      Consideration. As consideration for the sale of such Stock, the Buyer agrees

to pay Seller as follows: [1) ____________________ Dollars ($___________) to be paid in cash on

the Closing Date, “Closing Date” being the Effective Date of this Agreement; (and/or) 2) the

execution of that certain promissory note attached hereto as Exhibit ___.

               3.      Seller Warranties. The Seller does hereby covenant, represent and warrant as

follows:
                        3.1     All of the Stock is free and clear of all liens, charges and encumbrances and are

not subject to any restrictions with respect to their transferability;

                        3.2     Seller has full power and authority to sell, transfer, assign and deliver the Stock

to the Buyer;

                        3.3     There are no actions, suits or proceedings pending against the Sellers, at law or

in equity, relative to or affecting the sale of the Stock under this Agreement and/or Sellers’ rights, privileges or

interest in and to the Company; and Sellers do not know of or have any reasonable grounds to know of any

justification for any such action, suit or proceedings;

                        3.4     The Buyer shall receive good and marketable title to the respective Stock being

purchased.

                        3.5     Other than the Stock being purchased for the Purchase Price as provided herein,

neither the Seller, the Shareholders or any other person or entity owns or has any right to own any other

equity, stock, investments, options, warrants, rights, title and/or interests in and to the Company, or any assets

owned or used by the Company, and the Sellers are not and will not be entitled to any other payments, profits,

dividends, redemption, compensation or liquidation rights of and in the Company or its assets.

                4.      Company and Shareholder Warranties. The Company and the Shareholders do hereby

jointly and severally agree, covenant, represent, promise and warrant as follows:

                        4.1     To the best of Shareholder’s knowledge and belief, all of the Stock are free and

clear of all liens, charges and encumbrances and are not subject to any restrictions with respect to their

transferability; and the Buyer shall receive good and marketable title to the respective Stock being purchased.

                        4.2     There are no actions, suits or proceedings whatsoever pending against the

Company or any of the Company’ assets, at law or in equity; and the Shareholders do not know of or have any


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reasonable grounds to know of any justification for any such action, suit or proceedings. The Company are

not in breach or default of any contract, lease, obligation or commitment of any kind, and the Shareholders do

not know of or have any reasonable grounds to know of any breach or default;

                        4.3     All of the issued and outstanding equity interest in the Company, including the

    Stock, have been duly authorized and are validly issued, fully paid, and non-assessable. There are no

    outstanding or authorized options, warrants, purchase rights, subscription rights, conversion rights,

    exchange rights, or other contracts or commitments that could require any of the Company or its

    Shareholders to issue, sell, or otherwise cause to become outstanding any of its equity, Stock of interest,

    ownership and/or capital. There are no outstanding or authorized Stock, appreciation rights, phantom

    stock, profit participation, or similar rights with respect to the Company, and the Company have no

    subsidiaries nor any investment or other interest in any person or entity.

                        4.4     The Company are and have been in compliance in all material respects with all

laws, regulations and any other applicable legal requirements. The Company and/or the Company’

predecessors, subsidiaries and affiliates, have filed and paid any and all tax returns, taxes, licenses, license

fees, and such other payments required by law, and required to be filed within the applicable periods for such

filings, and has timely paid all taxes (including any foreign, federal, state or local taxes) required to be paid.

The Company has all the permits, licenses, orders, certifications, franchises and other rights and privileges of

all federal, state, local or foreign governmental or regulatory bodies necessary to conduct the Company’

business as presently conducted.

                        4.5     The Company and the Shareholders represent and warrant that there are no

contracts, agreements, letters of intent, rights, assets, property, and otherwise that relate in any way to, and/or

are used in any way in, the businesses and operations conducted by the Company, including but not limited to

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any and all Customer, Distribution, Agency, Vender Agreements by and between any of the Shareholders

individually or owned in any way by the Shareholders and the Shareholders’ covenant and agree to transfer

any and all contracts, agreements, letters of intent, rights, assets, property, and otherwise that relate in any way

to, and/or are used in any way in, the businesses and operations conducted by the Company, including but not

limited to any and all Customer, Distribution, Agency, Vender Agreements by and between any of the

Shareholders individually to the Company free and clear of any and all liens and encumbrances.

                        4.6     The Company and the Shareholders each covenant that it will amend, and file

where necessary, it’s Articles of Organization, Operating Agreement and any other Company documents

necessary to effect the terms and conditions of this Agreement, including the removal of Seller from any and

all appropriate Company documents, including Credit Lines, Bank Accounts, Leases and Notes, and the

inclusion of Buyer in the Amended and Restated Articles and Operating Agreement of the Company.

                5.      Resignations. Seller hereby tenders his resignation as an Officer, Director and/or

Employee of the Company, all of which resignations shall be delivered to the Buyer upon the execution of this

Agreement, and which shall be effective on the Closing Date of this Agreement.

                6.      Indemnification. Seller shall indemnify and hold Buyer harmless for and from any and

all claims, suits, judgment, or costs of any kind arising from any such claim, suit, debt, contribution, suit or

other dispute, including any costs incurred in establishing the right to indemnification provided for by this

paragraph, related in any way to the Stock and/or Seller’s ownership of the Stock that may have taken place on

or before the Closing Date. Additionally, the Company and the Shareholders shall indemnify and hold Buyer

harmless for and from any and all claims, suits, judgment, or costs of any kind arising from any such claim,

suit, debt, contribution, suit or other dispute whatsoever, including any costs incurred in establishing the right

to indemnification provided for by this paragraph, related in any way to the Company, the Stock and/or


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Seller’s ownership of the Stock, that arose or may arise in the future as a result of any transaction or

occurrence that may have taken place on or before the Closing Date.

               7.      Successors and Assigns. This Agreement shall be binding upon the heirs, executors,

administrators, successors, assigns, or other personal representatives of Seller, irrespective of their desire to

sell such stock, who shall be bound to carry out the provisions of this Agreement and to sell and transfer the

certificates evidencing ownership of such Stock to the Buyer in full compliance with the terms and provisions

of this Agreement. This Agreement shall inure to the benefit of the heirs, executors, administrators,

successors, assigns, or other personal representatives of Seller and to the successors and assigns of the Buyer.

               8.      Delivery of Assignment and Stock Certificates. Simultaneously with the execution of

this Agreement, Seller shall execute and deliver to the Buyer such instruments as may be necessary to transfer

title to the Stock to the Buyer, including executing the written Assignment attached hereto as Exhibit “C,” and

shall deliver to Buyer the certificates representing the Seller's Stock in the Buyer as set forth on the attached

Exhibit "A," and Seller shall do and perform any other acts and shall execute such other documents as are

reasonably necessary to consummate the redemption and to transfer good title to the Stock to the Buyer.

               9.      Entire Agreement. This Agreement contains the entire Agreement of the parties and

supersedes and cancels any other agreement, representation, communication or understanding, whether oral or

written, between the parties hereto and relating to the transactions contemplated herein or the subject matter

hereof. This Agreement may not be changed or terminated orally, but may only be changed by an Agreement

in writing signed by the parties hereto.

               10.     Interpretation of Agreement. All parties have participated fully in the negotiation and

drafting of this Agreement. The Agreement has been prepared by all parties equally, and is to be interpreted




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according to its terms. No inference shall be drawn that the Agreement was prepared by or is the product of

any particular party or parties.

                11.     Applicable Law. This Agreement shall be construed in accordance with the laws of the

State of [__________________].

                12.     Captions. The captions or headings in this Agreement are made for convenience and

general reference only and shall not be construed to describe, define or limit the scope or intent of the

provisions of this Agreement.

                IN WITNESS WHEREOF, the Buyer, by and through its duly authorized officer, the Seller, the

Company, by and through its duly authorized officer, and the Shareholders, have executed this Agreement

under seal on the date first written above.

                                              BUYER:

                                              ________________________________


                                              By_______________________________________
                                                    ______________________
                                                    Its ____________________



                                              SELLER:


                                              _________________________________________
                                                    __________________




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SHAREHOLDERS:


_________________________________________
      _____________


_________________________________________
      ________________


COMPANY:

________________________________________


By_______________________________________
      ______________________
      Its ___________________




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                            Exhibit A

               Stock Owned by Seller and Being Sold
               Pursuant to this Agreement, as follows:

                              Total Number of
       Number of Shares       shares of Stock in         Total Percent     Amount of Stock
       of Stock owned in      all Company                of the Company    owned by Seller
Name   each Company           Being Sold                 owned by Seller   after Purchase




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       Exhibit B

Promissory Note [if any]




           10
                                           Exhibit C


                    ASSIGNMENT SEPARATE FROM CERTIFICATE

              FOR VALUE RECEIVED, the undersigned Seller, does hereby sell, assign, transfer

and set over unto _____________________________________ (the “Buyer”), all of the Stock of

equity interest in the COMPANY, owned in any way by the Seller, and standing in the name of

_______________________ on the books of the Company, and does hereby irrevocably constitute

and appoint ______________________ as Attorney in Fact to transfer the said Stock on the books of

the Company with full power of substitution in the premises.

              Dated effective as of the___ day of __________, 200__.




                                                    ________________________________
                                                          ____________________



WITNESS:


Sign: _____________________________

Print Name:   _______________________




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