This is an agreement between a vendor and a purchaser whereby the vendor sells
shares in the capital of a specific business. This agreement specifies the number of
shares purchased, the purchase price, and the closing date. In addition, if the purchase
price is not immediately transferred, a promissory note can be attached to "Schedule A"
of this agreement. This agreement can be used by individuals or small businesses that
want to purchase or sell the shares in a specific business.
SALE OF INTEREST IN A COMPANY BY TRANSFER OF
This Sale of Interest In A Company By Transfer of Capital Agreement (herein referred to
as the "Agreement") is made and entered into this ___ day of _________, 20__ by and
between ___________________ (herein referred to as the "Vendor") whose offices are
located at ________________________ and ________________________ (herein
referred to as the "Purchaser") whose offices are located at
_________________________, hereinafter collectively referred to as the “Parties”.
WHEREAS the Vendor is the registered and beneficial owner of __________
(____) shares in the capital of the Company;
WHEREAS the Purchaser has agreed to purchase from Vendor ____________
(____) shares in the capital of the Company (hereinafter referred to as the "Sold Shares")
owned by the Vendor and the Vendor has agreed to sell to the Purchaser the Sold Shares
upon and subject to the terms and conditions hereinafter set forth;
NOW THEREFORE that in consideration of the mutual agreements herein
contained, the Parties hereto covenant and agree as follows:
I PURCHASE AND SALE
1.01 Purchase Price: The purchase price (the "Purchase Price") for the Sold Shares
shall subject to any adjustments provided for in this Agreement, will be
__________________ ($______________) Dollars which sum, in accordance with
generally accepted accounting principles, represents a fair and reasonable attempt by the
Parties to estimate and determine the fair market value of the Sold Shares as of the
1.02 Closing: The Purchase Price shall be payable in available cash funds or as agreed
upon by the Parties no later than [Insert Closing Date] (the “Closing Date”).
[Instruction: The Parties may agree that a demand promissory note in the form
attached hereto as Schedule A may be substituted for a cash transaction].
1.03 (optional) If, notwithstanding the determination by the Purchaser and the Vendor of
the Purchase Price for the Sold Shares:
A. there shall be issued to either the Purchaser or the Vendor a notice
of assessment or reassessment pursuant to any taxing statute,
which assessment or reassessment is based upon an assumption of
fact or a finding by such taxing authority that the fair market value
of the Sold Shares is different from that determined in accordance
with the provisions of this Agreement; or
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B. such taxing authority notifies either the Purchaser or the Vendor that it
intends to issue such notice of assessment or reassessment;
then, subject to the rights, if any, of the Purchaser and the Vendor to object or appeal
such assessment to any authority, board or court of competent jurisdiction, the fair market
value of the Sold Shares as at the Closing Date shall, for the purposes of this Agreement,
be deemed to be and to always have been the value of the Sold Shares as finally so
deemed by such taxing authority and the Purchaser or the Vendor, as the case may be, or
where either the Purchaser or the Vendor has objected to or appealed any such
assessment or reassessment, as finally determined by such authority, board or court.
Such value, however determined, shall be substituted for the fair market value as
determined in paragraph 1.01 hereof, and the Purchase Price (and manner of payment
thereof, if necessary) shall be adjusted accordingly. Without limiting the generality of
the foregoing, the Parties agree that the Purchase Price in the amount determined as
aforesaid shall be paid in accordance with paragraph 2.02 herein.
II DELIVERY OF CERTIFICATES, ETC.
2.01 On the Closing Date, Vendor shall transfer and deliver to Purchaser effective as of
the Closing Date, the Sold Shares duly endorsed in blank for transfer and shall cause the
Company to take all necessary steps or proceedings to enter the Purchaser or its
nominee(s) on the books of the Company as the holder of the Sold Shares and to issue
one or more share certificates to the Purchaser or its nominee(s) representing the Sold
III PLACE OF CLOSING (optional)
3.01 The Closing shall take place on the Closing Date at [Insert Place of
Closing] or at such other place as may be agreed upon by the Parties.
4.01 The Parties shall execute such other documents and do all things as may
be necessary or desirable to give effect to the terms of this Agreement and to carry out
the provisions hereof.
4.02 Each party shall indemnify, assume the defense of, and hold harmless the
other party and its directors, officers, employees, and agents from every claim, loss,
damage, injury, expense (including attorney’s fees), judgment, and liability of every kind,
nature, and description arising in whole or in part from the indemnifying party’s
negligent, fraudulent, or illegal acts or omissions except, as to the party requesting
indemnification, to the extent such liability results in whole or in part from the
unauthorized, negligent, fraudulent, or illegal act or omission of the party requesting
4.03 This Agreement shall be governed by and construed in accordance with the laws of
the State of ___________________. Each of the Parties in any suit, action or proceeding
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arising out of or relating to this Agreement, irrevocably (i) submits to the jurisdiction of
the State Courts of the State of _______ over any suit, action or proceeding arising out of
or relating to this Agreement, (ii) waives to the fullest extent enforceable under
applicable law any objection which it may now or hereafter have to the above venue of
any such suit, action or proceeding and any claim that any such suit, action or proceeding
brought in such Court has been brought in an inconvenient forum, (iii) waives to the
fullest extent enforceable under applicable law any objection which it may now or
hereafter have to the above mentioned Court having jurisdiction of the Parties hereto and
to the subject matter of this Agreement, and (iv) acknowledges that a final judgment in
any such suit, action or proceeding brought in such Court, after all appropriate appeals,
shall be conclusive and binding upon it. In any suit or arbitration regarding the
Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees and costs.
4.04 This Agreement shall enure to the benefit of and be binding upon the Parties
hereto and their respective heirs, executors, administrators, successors and assigns.
4.05 This Agreement may only be amended with the written consent of both Parties.
4.06 If any term, provision, covenant or condition of this Agreement, or its application
to any person, place or circumstance, shall be held to be invalid, unenforceable or void,
the remainder of this Agreement and such term, provision, covenant or condition as
applied to other persons, places and circumstances shall remain in full force and effect.
4.07 No failure or neglect of either party hereto in any instance to exercise any right,
power or privilege under this Agreement or under applicable law shall constitute a waiver
of any other right, power or privilege in any other instance. All waivers by either party
must be in wiring and signed by the party to be charged.
4.08 This Agreement contains the entire agreement and understanding between the
parties and supersedes any prior or contemporaneous written or oral agreements,
representations and warranties between them respecting the subject matter of this
4.09 This Agreement may be executed by the Parties in separate counterparts each of
which when so executed and delivered shall be an original and all such counterparts shall
together constitute one and the same instrument.
IN WITNESS WHEREOF the Parties hereto have executed this
Agreement as of the date and year first written.
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or if Vendor or Purchaser is a company
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FORM OF PROMISSORY NOTE
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