THIS AGREEMENT made this _(1)_ day of _____(2)______, 19_(3),
by and between _______(4)________, hereinafter "Shareholders"
of ________(5)___________, hereinafter "Corporation".
W I T N E S S E T H:
WHEREAS, the parties believe it is in their best interest
to unanimously agree to terms below related to the operation,
management and control of the Corporation in order to achieve
harmonious balance and direction.
NOW THEREFORE, the parties agree to the following:
1. The Shareholders agree to maintain "S" status
of the Corporation for federal tax purposes throughout a period
of five (5) years from the date hereof unless seventy-five
percent (75%) of outstanding stock of the Corporation is voted
in such a manner as to consent to the revocation of such status.
2. The parties hereto agree to execute a Buy-Sell Agreement
between and mutually acceptable by the parties.
3. For a period of five (5) years from the date of this Agreement,
the Shareholders as Directors shall, unless one is either
no longer a Shareholder, or unable or unwilling to perform,
vote for the following officers:
____________(7)____________ Vice President/Treasurer
4. Restrictive Endorsements shall be set forth on all the
stock certificates for the Corporation which shall set forth
that such stock is subject to the Buy-Sell Agreement terms
as well as to the voting restrictions contained herein.
5. The Corporation shall do its banking business at ________(9)________
or at such bank or banks as determined in the sole discretion
of the Directors. The signature of any one officer of the
Corporation shall be sufficient for checks or drafts up to
the amount of One Thousand Dollars ($1,000.00). The joint
signature of either ______(10)______ or _______(11)_____ as
one party, and _______(12)________ as the other party will
be necessary for any check over the amount of One Thousand
6. The Shareholders consent that upon the occurrence of a
situation whereby the operating capital of the Corporation
is not sufficient to meet operating expenses and upon a majority
vote by the Shareholders each Shareholder shall make the required
contribution as to such total request within thirty (30) days
of request of a Shareholder in the proportion of their stock
ownership interest in the Corporation. Failure to make such
contribution within said thirty (30) days will result in the
then remaining Shareholders having the right to purchase the
prorata share of the stock held by the Shareholder who has
failed to make his capital contribution by purchasing the
capital contribution together with interest at prime (as determined
by Chase Manhattan Bank) plus one percent (1%).
7. The parties hereto agree that the Corporation shall lease
certain real property for its corporate purposes.
8. The Corporation shall utilize the accrual method of accounting
with a year ending in December of any given year.
9. Corporate books shall be kept in the offices of the Corporation
unless the Shareholders agree otherwise. The books are to
be maintained under generally accepted accounting standards
with sufficient controls and audit trail necessary for easy
outside review. A monthly financial operating statement shall
be sent to each Shareholder not later than seven (7) working
days after the last day of the previous month. Such financial
report shall include current month and year to date results
of operation and balance sheet information. Furthermore, at
the request of any Shareholder, the parties agree to an annual
financial review for a previous year of business. Any such
annual review shall be performed by someone other than the
CPA who is utilized for day to day operations by the Corporation.
10. For transactions involving up to and including the amount
of One Thousand Dollars ($1,000.00), any officer of the Corporation
is authorized to enter into in the future any and all contracts
and leases for the improvements, purchase, maintenance, sale,
lease or other disposition of corporate property in the form
customary for such agreements. Furthermore, to the extent
of the above stated limit an officer may borrow money on behalf
of the Corporation at commercially reasonable terms. Any transaction
of whatever kind, over and above the amount of One Thousand
Dollars ($1,000.00) shall be agreed to in writing prior to
the binding the Corporation to the same by Shareholders holding
a minimum of seventy-five percent (75%) of the outstanding
shares of the Corporation. Furthermore, each Director must
sign each agreement, lease, contract or other document in
which any corporate obligation is created to signify their
consent to approving the same.
11. The Shareholders hereof shall be respectively entitled
to reimbursement from the Corporation for all personal out-of-pocket
direct costs, including on-site costs incurred by them in
furthermore of the Corporation's business. Such Shareholders
shall furnish written receipts relative to the same upon request.
It is expressly understood that no cost over and above One
Thousand Dollars ($1,000.00) shall be incurred without the
written consent of the Shareholders holding a minimum of seventy-five
(75%) of the outstanding shares of the Corporation.
12. The parties hereto agree to execute any and all necessary
documents required to carry out the terms of this Agreement.
13. This Agreement shall be binding upon, and inure to the
benefit of the parties thereto, their legal representatives,
successors and assigns. However, no assignment shall be made
of the rights hereunder without the prior written consent
of the other parties.
14. This Agreement shall be governed by and construed in
accordance with the laws of the State of _____(13)_____.
15. This Agreement embodies and constitutes the entire understanding
between the parties with respect to the transactions contemplated
herein. All prior or contemporaneous agreements, understandings,
representations, oral or written, are merged into this Agreement.
Neither this Agreement nor any provision hereof may be waived,
modified, amended, discharged or terminated except by an instrument
in writing signed by the party against which the enforcement
of such waiver, modification, amendment, discharge or termination
is sought and then only to the extent set forth in such instrument.
16. In the event a party to this Agreement must employ an
attorney to enforce the provisions hereof or to secure performance
by a defaulting party under the terms herein stated, the prevailing
party in litigation arising therefrom shall be entitled to
an award of its reasonable attorney's fees both on trial and
the appellate level incurred in enforcing this Agreement and/or
securing performance of the terms herein stated.
17. This Agreement shall have an initial term of five (5)
years and shall be renewed for additional five (5) year terms
automatically and perpetually thereafter unless a Shareholder
decides to terminate the same within sixty (60) days of the
end of a term, whereupon such Shareholder shall be deemed
to have offered his stock under the Buy-Sell Agreement described
above as amended. This Agreement shall terminate upon the
earlier of the following:
a. Dissolution of the Corporation;
b. Mutual agreement of the parties hereto;
c. Bankruptcy of the Corporation or of any Shareholder.
18. All notices that the parties hereto may desire or be
required to give hereunder shall be deemed to have been properly
given and shall be effective when and if sent by U.S. regular
mail, postage prepaid, U.S. certified mail and/or by personal
delivery or by courier, addressed to the following:
This Agreement has been entered into on the date set forth
Acceptance, ratification and acknowledgment of the above
ATTEST: ________(26)_________ Secretary
The information in this document is designed to provide an
outline that you can follow when formulating business or personal
plans. Due to the variances of many local, city, county and
state laws, we recommend that you seek professional legal
counseling before entering into any contract or agreement.
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