A Stock Sale Agreement helps you to define and agree the terms of a business sale where the transaction involves the shares of the business entity, rather than just its assets.
It includes the purchase price and the closing details of the transaction.
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The Corporation Stock Sale Agreement is used where you've already negotiated the sale of your company and you want to formally define the terms and conditions of the sale in a legally binding Agreement.
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Corporation Stock Sale Agreement
This Stock Sale Agreement (the "Agreement") is made and entered into on this day, xxth January 2013 (the "Date of Execution").
The Agreement is between the owner of the capital stock detailed in this Agreement___________ (the "Seller")_________________(insert Seller’s address, city, state, Zip) of ______________ (the "Corporation") located at _________________(insert Corporations address, city, state, Zip), and ______________ (the "Buyer") _______________(insert Buyer’s address, city, state, Zip).
The Buyer and the Seller are hereby referred to as the "Parties" (or in the singular, "Party") to this Agreement.
2. Background information
The Seller owns ________(insert number of shares) of ________class shares (insert class of share ) each with a par value of $__________ for ______________________
(insert Corporation name), covered in this Stock Sale Agreement, which is a going concern undertaking the business of ______________________________________ (brief description of main business activities).
The Seller wishes to sell the shares in the Corporation to the Buyer, and the Buyer wishes to buy the aforementioned shares, subject to the terms and conditions set out in this Agreement and attached Schedules.
The Seller confirms that he/she is the owner of the Corporation stock that is the subject of this Agreement and has the authority to sell and transfer them to the Buyer on successful closure of this Agreement.
The Seller confirms that the Corporation is organized validly under the State laws of _________(insert name of State), is of good business standing, and that it has the power and authority to carry out its current business activities.
3. Purchase Price
The Buyer shall pay, and the Seller shall accept the sum of $_________ for each share of the Corporation representing a total payment of $____________ (the Purchase Price).
Subject to the terms and conditions set out in this Agreement the Seller will sell, transfer and deliver the Corporation’s stock certificates to the Buyer, and the Buyer shall pay the Purchase Price to the Seller.
Both the Seller and the Buyer acknowledge that the Purchase Price represents the fair market value for the shares.
Unless otherwise stated in this Agreement and Schedules, the Seller and the Buyer shall agree to pay all their own costs incurred in the negotiation, execution and delivery of this Agreement. The Parties confirm that there is no valid claim relating to this transaction including, but not limited to, commission or finder’s fee payable to a broker or agency.
4. Terms of the Agreement
The payment terms for this Agreement shall be (amend as appropriate):
a. Cash deposit: $___________ deposited in partial consideration of the Purchase Price as earnest money in cash or check, awaiting closure of the sale, in an escrow account held by _________________(insert name) at ____________________(insert address, city, state, Zip)
b. Cash balance: $_____________additional sum payable by cash or check on the Agreement closure date stated below
In the event that the Agreement is not closed, and the
Buyer has tried in good faith to obtain the necessary
finance, the earnest deposit shall be returned to the Buyer,
with the stock retained by the Seller. On payment of the
cash balance on the date of closure, the Seller shall confirm authorization to transfer the Corporation stock certificates to the Buyer.
5. Representation and warranties
This Agreement represents the complete and current understanding of the Parties concerning the sale of the Business as described in this Agreement and attached Schedules:
a. this Agreement supersedes any previous written or oral statements, understandings, warranties, representations, covenants, and agreements between the Seller and the Buyer, and shall survive the closing date of this Agreement
b. the Seller confirms that as the legal owner of the Corporation’s stock, there are no third party claims or restrictions on the stock (including, though not restricted to) stock purchase options, warrants or redemptions, securities convertible into the stock, encumbrances or liens
c. the Seller confirms that there is no Agreement, whether written or oral, that grants voting rights in respect of the Corporation’s stock to a third party
d. the Seller shall ensure that the Corporation’s stock certificates have been duly endorsed for transfer or evidence presented guaranteeing authorization of the transfer
6. Law Governing this Agreement
This Agreement is governed by, construed and enforced by the laws of ___________State.
In the event of a dispute the Parties agree that the prevailing Party has the right to reclaim reasonable costs from the other Party, including court costs and expenses as well as Attorney costs.
7. Closing date for the Agreement