Business Sale Consulting Agreement

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Business Sale Consulting Agreement Powered By Docstoc
					                                    CONSULTING AGREEMENT

                                      (Prepared by William M. Keever)

         THIS AGREEMENT made this _____ day of ___________, 20__ by and between ________
_____________________________, a corporation organized and existing under the laws of the State of
___________ (the “Consultant”), and _____________________________, a corporation organized and
existing under the laws of the State of __________ (the “Company”).

                                                 RECITALS:

        A. Consultant is engaged in the business of advising companies regarding ____________
________________________________________________________________________________
[Insert Consulting Services to be performed]

       B. Company recognizes the expertise and special knowledge of Consultant and desires to engage
Consultant pursuant to the terms and conditions of this Agreement.

                                              AGREEMENT

        NOW THEREFORE, In consideration of the parties entering into this Agreement, the mutual
promises and covenants contained herein, and such other good and valuable consideration, the parties each
agree to all covenants, obligations, representations and promises contained in the following:

       1.       Introduction. Consultant shall confer with Company on matters pertaining to ____
       __________________________________________________________________________
Accordingly, the Company agrees with Consultant to the terms and conditions set forth in this Agreement.


         2.      Engagement of Consultant. By entering into this Agreement, the Company agrees to retain
Consultant and the Consultant agrees to advise Company and provide such services as more specifically
identified and described in Exhibit A attached hereto and incorporated herein by reference until such time as
this Agreement terminates in accordance with Section 14 herein below. The Company and Consultant agree
that for the purposes of rendering these services, Consultant will rely and is justified in relying on the accuracy
of information or documents prepared and provided by the Company. Consultant agrees to review, confer and
advise Company regarding any necessary documentation that Company or its attorneys prepare as a result of
Consultants services, and prior to negotiations with or such documents release to [public, company, brokers,
investment advisors, bankers, engineers . . .] Consultant hereby acknowledges and agrees that the
Company is free to reject any advice, introduction, referral, recommendation or otherwise presented to the
Company by Consultant.
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        3.        Fees. In consideration of Consultants performance of the services described in herein, the
Company agrees to pay Consultant certain fees, [either in cash or stock (the Shares)] and expenses as
specifically identified and described in Exhibit B attached hereto and incorporated herein by reference.

       4.       Representations and Warranties of the Company. The Company represents and
warrants to and agrees with Consultant that:

                  (a) The Company is a corporation duly incorporated, validly existing and in good standing
under the laws of the state of its incorporation, with corporate power and authority to own its properties and
conduct is business as now conducted, and is duly qualified to do business as a foreign corporation in good
standing in all other jurisdiction where the failure to so qualify would have a material adverse effect upon the
Company and that the Company holds all licenses, certificates, permits, franchises and authorizations from any
and all governmental authorities which are material to the conduct of its business in all locations in which such
business is currently being conducted.

                 (b) The Company has full legal right, power and authority to enter into this Agreement and to
issue, sell and deliver any Securities or Shares to be sold by it to potential investors and/or Consultant as
provided herein, and this Agreement has been duly authorized, executed and delivered by the Company and
constitutes the valid and legally binding obligation of the Company, enforceable against the Company in
accordance with its terms.

                (c) The Company has only one class of equity securities authorized to be issued and, on the
effective date of this Agreement, the aggregate number of the Company's shares authorized to be issued is
_______________ shares of Common Stock, with a par value of $________ per share. As of the effective
date of this Agreement, there are _________ shares of the Company’s common stock issued and
outstanding.

                (d) The Securities and Shares will be validly authorized and, upon issuance and delivery for
payment therefor in accordance with this Agreement, will be validly issued, fully paid and nonassessable,
without any personal liability attaching to the ownership thereof, and will not be issued in violation of any
preemptive or similar rights of shareholders and Consultant and any potential investors will receive good title
to the Shares or Securities purchased by them, fee and clear al all liens, security interest, pledges, charges,
encumbrances, shareholders agreements, and voting trusts.

                (e) All documents prepared by the Company for purposes of any offering or to be used in
connection with any offering, including, but not limited to, a private placement memorandum, a business plan
or such other documents as may be provided to Consultant by the Company for purposes of this Offering, any
documents prepared by Consultant based upon information provided to Consultant by the Company, the
Company’s Subscription Agreement between prospective investors and the Company, and any Confidential
Investor Questionnaire (unless the information in the Confidential Investor Questionnaire is included in the
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Subscription Agreement), and any amendments or supplements thereto (Offering Documents), are and willbe
prepared in accordance with the 1933 Act and the Rules and Regulations of the SEC as necessary to comply
with a Regulation D Exemption, and the Company either has or will timely file all required documentation with
the SEC and any applicable state securities commissions, if any, with jurisdiction over any such offering.

                  (f) The Offering Documents do not and will not include any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to make the statements therein not
misleading, except that this representation and warranty does not apply to statements or omissions made in
reliance upon and in conformity with information furnished by Consultant in writing to the Company in
connection with the Offering Documents, or any amendment or supplement thereto.

               (g) The Company and the Company’s counsel has reviewed the applicable registration
requirements of the 1933 Act and all applicable state securities laws and has determined that the certain
exemptions are available to the Company in the offering and that the Company has complied with such
exemptions.

               (h) The Company represents and warrants to Consultant that it has not, directly or indirectly,
made any offers or sales of the Securities, Shares or other securities, whether debt or equity, within the past
(12) twelve months from the effective date of this Agreement.

                 (i) The Company represents and warrants to Consultant that it will not, directly or indirectly,
make any offers or sales of the Securities, Shares or other securities, whether debt or equity, during the term
of this Agreement or after completion of any private placement contemplated herein, except for the offeringof
the Securities or Shares through the Company’s broker-dealer or other qualified placement agents. As used
herein, the terms offer and sale have the meanings specified in Section 2(3) of the 1933 Act.

         5.       Representation and Warranties of Consultant. Consultant represents and warrants to
and agrees with the Company that Consultant is familiar or will make itself familiar with all applicable federal
and state securities laws and the regulations thereunder which restrict the public sale and distribution of
securities without either a registration statement, qualification or exemption being in effect with respect thereto.
In exercising its duties under this Agreement, Consultant will not cause the Company to be engaged in a public
offering.

         6.      Legal Opinion. With respect to any offer or sale of securities contemplated herein, the
Company agrees to provide Consultant, prior to commencement of any offering, a legal opinion (Opinion) of
its counsel which is reasonably satisfactory to Consultant, and that at a minimum provides the representations
and warranties delineated in Exhibit C attached hereto and incorporated herein by reference.

        7.       Covenants of the Company. The Company agrees with Consultant that:

                 (a) The Company will consult with Consultant regarding the drafting of any Offering
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Documents and the approval of any subscription agreement associated with the offering.

                (b) The Company will not distribute any Offering Documents that name Consultant in any
way, including as a placement agent, broker, investment banker or other like terms to any potential investor.

               (c) The Company will furnish to Consultant copies of all Offering Documents in such quantities
as Consultant may reasonable request.

                 (d) All potential investors will be given reasonable access to material information regarding the
Company and reasonable opportunity to ask questions of the Company’s executive officers. Notwithstanding
the foregoing, the Company shall not be required to disclose to Consultant or any potential investors any of the
Company’s trade secrets or other proprietary technical information.

                 (e) The Company will not, directly or indirectly, make any offer or sale of any of the Securities
or any securities of the same or similar class as the Securities, the result of which would cause the offer and sale
of the Securities to fail to be entitled to the Exemptions.

                (f) The Company will not, directly or indirectly, without the prior written consent of Consultant,
engage any other professional or consulting services that may circumvent, interfere or compete with the services
of Consultant contemplated herein, including but not limited to, other consultants, attorneys, broker-dealers,
underwriters, banks, other lending institutions, whether foreign or domestic, that engage in any way in anyofthe
services contemplated herein.

                  (g) The Company agrees to take such action (if any) as Consultant may reasonable request to
qualify the Securities for offer and sale under the securities laws of such states as Consultant may specify;
provided that in connection therewith the company will not be required to qualify as a foreign corporation or
file a general consent to service of process. The Company agrees that it will make any filings or take other
actions required under applicable laws to permit the sale of the Securities.

                  (h) If any event occurs as a result of which any Offering Documents would include an untrue
statement of a material fact, or omit to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it is necessary at any time to
amend the Offering Documents to comply with the 1993 Act, the Company will promptly prepare and, if so
required, file with the SEC or any state securities commission any amendment or supplement which will
correct such statement or omission or an amendment of supplement which will effect such compliance and will
supply such amended or supplemented Offering Documents to Consultant, in each case as soon as available
and in such quantities as Consultant may reasonable request.

                (i) During the period of this Agreement, an officer of the Company shall promptly notify an
officer of Consultant of any material events which would necessitate modification of any financing transaction
or Offering Documents, and shall be reasonable responsive to Consultants inquiries about the Company’s
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ongoing operations as they relate to the Financing and the Offering Documents. The Company shall permit
Consultant to make such investigations of the business, properties and financial and legal conditions of the
Company and its subsidiaries as Consultant may reasonable request. No such investigation by Consultant, if
made, shall affect the representations and warranties of the Company in Section 4.

                  (j) The Company will not directly or indirectly circumvent Consultant or any of its affiliates
with respect to any investors introduced to Company as a direct or indirect result of this Agreement, without
the prior written consent of Consultant. In the event of a breach of this section by any party to this
Agreement, the other parties will have injunctive and equitable relief available, as well as all other remedies at
law or in equity.

                (k) The Company shall take all necessary action to properly authorize and approve the
issuance of the Securities and the Shares.

                (l) Consultant shall have full power and authority as an independent contractor to take all
actions and do all things necessary or reasonably proper to provide the services specified in this Agreement
and Company shall take all actions necessary to ensure such power and authority.

                 (m) Company will at all times disclose any and all information pertaining in any way to
Consultants services contemplated herein, any fund raising, whether through the sale of equity or debt,
factoring receivables, inventory financing, or such other methods of procuring in any form capital for the
Company. This covenant shall also require the full and absolute disclosure of any and all professionals or
consultants that Company has or may receive advice in any form from that pertains in any way to the subject
matter of this Agreement.

                 8.      Status of Consultant. The Company understands and acknowledges that
Consultant is acting as a consultant only, and is not a licensed securities or real estate broker or dealer, and
shall have no authority to enter into any commitments on the Company’s behalf, or to negotiate the terms of
Financing, or to hold any funds or securities in connection with Financing or to perform any act which would
require Consultant to become licensed as a securities or real estate broker or dealer. The Company further
understands and acknowledges that Consultant is not attorney, accountant, investment advisor, investment
company, broker-dealer or banking institution, and Consultant will not perform any services requiring, and
Consultants services should not be construed by Company as those requiring, Consultant to be or become an
attorney, accountant, investment advisor, investment company, broker-dealer or banking institution. Where
necessary, Consultant will advise and refer Company to any such professional service providers.

                 9.       Indemnification. (a) To the extent permissible by law, the Company will indemnify
Consultant, its directors, officers, partners, agents, consultants, employees and controlling persons (within the
meaning of the 1933 Act) against any losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) related to or arising out of any failure to register the Securities sold in the Offering with the
SEC in accordance with the 1933 Act or with any state securities commission in accordance with any
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applicable state securities laws, or related to or arising out of any untrue statement or alleged untrue statement
of any material fact contained in the Offering Documents, or any amendment or supplement thereto, or related
to or arising out of the omission or alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, or related to or arising out of the violation of any
other statute, regulation, rule or other law, whether federal or state, resulting from the Offering, and will
reimburse Consultant and each other person indemnified hereunder for all reasonable legal and other expenses
incurred in connection with investigating or defending any such losses, claims, damages, liabilities, actions or
approvals; provided, however, that the Company will not be liable in any such case for losses, claims,
damages, liabilities or expenses arising out of the gross negligence or willful misconduct on the part of
Consultant, its directors, officers, partners, agents, consultants, employees and controlling persons (within the
meaning of the 1933 Act.). In the event a claim for indemnification is determined to be unenforceable by the
final judgment of a court of competent jurisdiction, then the Company shall contribute to the aggregate losses,
claims, damages or liabilities to which Consultant or Consultants directors, officers, partners, agents,
consultants, employees or controlling persons (within the meaning of the 1933 Act) may be subject in such
amount as is appropriate to reflect the relevant benefits received by each of the Company and the party
seeking contribution, on the one hand, and the relative faults of the Company and the party seeking
contribution on the other, as well as any relevant equitable contribution.

            (b) Promptly after receipt by an indemnified party under this Section 8 of the notice of the assertionof
any claim or the commencement of any action, if any indemnified party intends to make a claim for
indemnification against any indemnifying party under this Section 8, then the indemnified party will notify the
indemnifying party in writing of such assertion or commencement and will provide the indemnifying party with
copies of all pleadings with which the indemnified party has been served or has otherwise obtained; provided
however, the omission to so notify the indemnifying party will not relieve the indemnifying party from any
liability it may have to the indemnified party otherwise than under this Section 8. In case any such action is
brought against any indemnified party, and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and to assume the defense thereof, with counsel
satisfactory to such indemnified party (it being understood that the indemnifying party shall not be liable for the
fees and expenses of more than one separate firm of attorneys for all such indemnified parties). After notice
from the indemnifying party to such indemnified party of their election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this Section for any legal or other
expenses subsequently incurred by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation.

        10.      Confidentiality.

                 (a) Consultant agrees that, for a period of three (3) years from the effective date of this
Agreement, Consultant will not disclose or make commercial use of any confidential information provided to
Consultant by the Company except with the Company’s prior written consent, or, after taking reasonable
action to protect the confidentiality of the information, as required by federal or state laws or regulations or the
by-laws or rules of any self-regulatory organization.
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                 (b) Company agrees that, for a period of three (3) years from the effective date of this
Agreement, Company will not disclose without the prior written consent or authorization of Consultant, any
confidential information regarding Consultant, including Consultants relationship to Company, the terms and
conditions of this Agreement and the fee arrangement contained in this Agreement. As used herein, such
confidential information shall also include, but is not limited to, any information relating to the individuals or
entities introduced to Company by Consultant in performance of Consultant’s services contained herein.

        11.      Notice.

             (a) Whenever notice is required by the provisions of this Agreement to be given to the
Company, such notice shall be in writing addressed to the Company as follows:

                           ____________________________
                           ____________________________
                           ____________________________
                           ____________________________

                (b) Whenever notice is required by the provisions of this Agreement to be given to Consultant,
such notice shall be given in writing addressed to Consultant as follows:

                           ____________________________
                           ____________________________
                           ____________________________
                           ____________________________

                   (c) If addressed or faxed in accordance with subsection (a) or (b) above, as the case may be,
notice shall be deemed properly given, if sent via U.S. mail, by the third business day following placement of
the notice is first class U.S. mail, postage prepaid, if sent via courier, upon confirmation of delivery by such
courier, and if via facsimile, upon confirmation of the successful facsimile.

        12.      Benefit and Non-Assignment. This Agreement is made solely for the benefit of Consultant,
the Company, their respective officers and directors and any controlling person referred to in Section 15 of
the 1933 Act, and their respective successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. Notwithstanding the foregoing, this Agreement may not be assigned by
Consultant without the prior written consent of the Company or assigned by the Company without the prior
written consent of Consultant. The term successor or the term successors and assigns as used in this
Agreement shall not include any purchasers, as such, in the Offering.




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         13.     Survival. All representations and warranties of the Company contained in Section 4, all
covenants of the Company contained in Section 7 and the indemnify agreements of the Company and
Consultant contained in Section 9 hereof shall survive and remain in full force and effect for a period of three
(3) years following the termination of this Agreement, regardless of (i) any investigation made by or on behalf
of Consultant or any such officer or director thereof or any controlling person of Consultant, (ii) full
performance of the terms of this Agreement and (ii) delivery of or payment for the Shares. Any successor of
the Company or Consultant or any controlling person, officer of director thereof, as the case may be, shall be
entitled to the benefits hereof.

         14.      Termination. Consultant may terminate this Agreement (a) upon giving the Company
written notice in the event that the Company fails to cure any violation of the Company’s representations and
warranties in Section 4 within five (5) days after the Company receives written notice of such violation from
Consultant, (b) fails to provide Consultant with a legal opinion as required by Section 6, (c) fails to comply
with any of the Company’s covenants in Section 7 or (d) if the Company and Consultant fail to agree as to
the method, structure and terms of any financing in accordance with Section 2. Consultant shall have the sole
and absolute discretion to determine whether any such presentation and warranty has been violated for
purposes of termination only and shall state such violation in each of the above notices. Notwithstanding any
provision in this Agreement to the contrary, this Agreement shall continue until the earlier to occur of either (i)
the mutual written agreement of the parties to terminate the Agreement, or (ii) one hundred and eighty (180)
days following the effective date of this Agreement.

        15.    Termination Benefits. Upon any such termination of this Agreement, unless otherwise
agreed by the parties in writing, the Consultant shall be entitled to receive any and all compensation and
expenses as defined herein, if any, unpaid on the date of termination. The Consultant shall not be entitled to
additional compensation or own any interest in the account receivable, work in process or other assets of the
Company except as expressly provided in this Agreement.

       16.       Amendments. This Agreement shall not be modified or amended except by a writing signed
by both parties.

        17.     Prior Agreements. 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.

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         18.      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
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.

         19.       Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of
any successor to the Company and such successor shall be deemed substituted for the Company under the
terms of this Agreement. As used in this Agreement, the term "successor" shall include any person, firm,
employer or other business entity which at any time, whether by merger, purchase or otherwise, acquires allor
substantially all the assets of the business of the Company. This Agreement shall also be binding upon and
inure to the benefit of the Consultant, its successor and assigns.

        20.     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.

        21.      Governing Law. The validity, interpretation and construction of this Agreement and of each
part hereof will be governed by the laws of the State of ___________, excepting its conflict of laws statute.
Each party hereto consents that the only proper jurisdiction and venue shall be the state courts in __________
County, ___________, for a resolution of all disputes arising out of the construction, interpretation or
enforcement of any term or provision of this Agreement, and each party hereby waives the claim or defense
that such courts constitute an inconvenient forum.

        22.    Counterparts. This Agreement may be executed in any number of counterparts, each
of which may be deemed an original and all of which together will constitute one and the same instrument.

         23.      Severability. The invalidity or enforce ability of any provision of this Agreement shall not
affect the invalidity or enforce ability of any other provision of this Agreement which shall remain in full force
and effect. If any term or provision of this Agreement shall be invalid or unenforceable to any extent or
application, then the remainder of this Agreement shall be valid and enforceable to the fullest extent and the
broadest application permitted by law.

        24.     Electronic Communication Systems. This Company acknowledges that various
communications systems and networks do not necessarily represent a secure environment in which to conduct
communications. These systems include certain telephone systems, computer networks and the Internet.
Nevertheless, the Company hereby authorizes Consultant to use any such systems (including sending and
receiving facsimiles and electronic mail) for communications of sensitive information about the Company.

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       IN WITNESS WHEREOF, the Company, by and through its duly authorized officers, and the
Consultant have caused this Agreement to be executed under seal on the ____ day of _____________,
20__.

[FIRST PARTY:]

                             IF BUSINESS ENTITY:

                             [Name of Company                                                   ]




                             By: ___________________________________

                             Name: _________________________________

                             Title: __________________________________


                             IF INDIVIDUAL:


                             Sign: __________________________________

                             Print Name: _____________________________


[SECOND PARTY:]


                             IF BUSINESS ENTITY:

                             [Name of Company                                                   ]




                             By: ___________________________________

                             Name: _________________________________

                             Title: __________________________________

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                                             -10-
                            IF INDIVIDUAL:


                            Sign: __________________________________

                            Print Name: _____________________________




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                                         -11-
                                         [Notary Seals, if needed]

[IF BUSINESS ENTITY]

STATE OF _____________ )

______________ COUNTY )

                 I, the undersigned, a Notary Public in and for said County, in said State, hereby certify that
______________________ [Name], whose name as ________________ [Title] of
_____________________ [Name of Company], a _____________ [Entity Type] formed and existing
under the laws of the State of ___________ [State in which entity was formed], is signed to the foregoing
Agreement, and who is known to me, acknowledged before me on this day that, being informed of the
contents of said Agreement, ______ [he, she or it], as such officer or director and with full authority, executed
the same voluntarily for and as the act of said corporation on the day the same bears date.

                 Subscribed and sworn to before me on this ____ day of _____________, 20__.


                                                   _________________________________________
                                                   Notary Public
                                                   My Commission Expires: ____________________
[IF INDIVIDUAL]

STATE OF _____________ )

______________ COUNTY )

               I, the undersigned, a Notary Public in and for said County, in said State, hereby certify that
____________________________ is signed to the foregoing Agreement, and who is known to me,
acknowledged before me on this day that, being informed of the contents of said Agreement, ____ [he or she]
executed the same voluntarily on the day the same bears date.


                 Subscribed and sworn to before me on this ____ day of _____________, 20__.


                                                   _________________________________________
                                                   Notary Public
                                                   My Commission Expires: ____________________

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                                                    -12-
                                        EXHIBIT A

                                        SERVICES


            Consultant agrees to consult with Company regarding the following: __________
_____________________________________________________________________________
_____________________________________________________________________________




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                                           -13-
                                    EXHIBIT B

                                FEES AND EXPENSES




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                                      -14-
                                                 EXHIBIT C

                                             LEGAL OPINION

                  (a) The Company is a corporation duly incorporated, validly existing and in good standing
under the laws of the state of its incorporations, with corporate power and authority to own its properties and
conduct is business as now conducted, and is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions where the failure to so qualify would have a material adverse effect upon the
Company and that the Company holds all licenses, certificates, permits, franchises and authorizations from
governmental authorities which are material to the conduct of its business in all locations in which are material
to the conduct of its business in all locations in which such business is currently being conducted;

                  (b) The Company has full legal right, power and authority to enter into this Agreement and to
issue, sell and deliver the Securities and/or Shares to be sold by it to Potential Investors and the Consultant as
provided in the Agreement, and this Agreement has been duly authorized, executed and delivered by the
Company and constitutes the valid and legally binding obligation of the Company, enforceable against the
Company in accordance with its terms, except as rights to indemnity and contribution thereunder may be
limited under applicable law and except as enforce ability may be limited by general equitable principles,
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer, fraudulent conveyance or other laws
affecting creditors rights generally, including, without limitation, the United States Bankruptcy Code and
applicable state laws.

                 (c) The Company has only one class of equity securities authorized to be issued and, on the
effective date of this Agreement, the aggregate number of the Company’s shares authorized to be issued is
_______________ shares of Common Stock, with a par value of $________ per share. As of the effective
date of this Agreement, there are _________ shares of the Company’s common stock issued and
outstanding.

                (d) The Securities and Shares are validly authorized and, upon issuance and delivery for
payment therefor in accordance with this Agreement and the Warrant, will be validly issued, fully paid and non
assessable, without any personal liability attaching to the ownership thereof, and will not be issued in violation
of an any preemptive or similar rights of shareholders and the Potential Investors will receive good title to the
Securities purchased by them, free and clear of all liens, security interests, pledges, charges, encumbrances,
shareholders agreements, and voting trusts.

                 (e) To the best of Company Counsel knowledge, no consent, approval, authorization or
order of any court or governmental agency or body or third party, is required for performance of this
Agreement by the Company for the consummation by the Company of the transaction contemplated thereby,
except such as have been obtained and such as may be required by state securities or Blue Sky laws in
connection with the placement of the Securities. The performance of this Agreement by the Company and the
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                                                     -15-
consummation by the Company of the transactions contemplated thereby will not conflict with or result in a
material breach or violation by the Company of any of the terms or provisions of, or constitute a material
default by the Company under, any indenture, mortgage, deed of trust, loan agreement, lease or other
agreement instrument known to us which the Company is a party or to which the Company or its properties is
subject, for a violation or breach of its articles or incorporation or by-laws of the Company, any material
breach or violation of any statute, or any judgment, decree, order, rule or regulation known to us of any court
or governmental agency or body applicable to the Company or its properties.

                 (f) To the best Company Counsel knowledge:

                         (i) The Offering Documents were prepared in all material respects in accordance with
the Exemptions, and that the Company has, or will in a timely manner file all necessary documentation,
including, but not limited to, a Form D, with the SEC and all state securities commission, if any, with
jurisdiction over the Offering and that the Company has not conducted any other offerings within the last six
months which may be integrated with the Offering pursuant to Rule 502 of Regulation D other than securities
issued pursuant to a merger, acquisition or other business combination involving the Company.

                         (ii) Neither the Offering Documents nor any amendment or supplement thereto, as of
thereto, as of the respective dates thereof and as the date of the Opinion, contained an untrue statement of a
material fact or omit to state any material fact required to be stated therein or necessary to make the
statements therein not misleading (except that the Opinion expresses no view as to financial statements
schedules and other financial information included therein).

                  (g) To the best of Company Counsel knowledge, there is not pending or threatened any
action, suit, proceeding inquiry, or investigation, to which the Company is a party, or to which the party of the
Company is subject, before or brought by an court or governmental agency or body, which, if determined
adversely to the Company, could result in any material adverse change in the business, financial position, net
worth or results of operations, or could materially adversely affect the properties or assets, of the Company.

                 (h) To the best of Company Counsel knowledge, the Company is not in material violation of
any law, ordinance, administrative or governmental rule or regulation applicable to the Company and material
to the Company taken as a whole, or any decree of any court of governmental agency or body having
jurisdiction over the Company.


Instrument Prepared By William M. Keever




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                                                    -16-

				
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