PARTNERSHIP BUY AND SELL AGREEMENT
EXHIBIT
5
S.O.C.O.
ENTERPRISES
PARTNERSHIP
BUY
AND
SELL
AGREEMENT
AGREEMENT
entered into this 1st day
of
September 2001, by and between XXXXXX X. XXXXXXXXXX, 000 Xxxxxxxxxx Xxxx,
Xxxxxxxxxxx, Xxxxxxxxxxxx; XXXXX X. XXXXXXXXXX, 000 Xxxxxx Xxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx: XXXXX X.
XXXXXXX.
000 Xxxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx; and XXXXXXX X. X'XXXXX, R.
R.
#5
-
Box
174,
Muncy, Pennsylvania, hereinafter designated "PARTNERS".
WITNESSETH:
WHEREAS,
the Partners are members of the Co-partnership' doing business under the
firm
name of S.O.C.O. ENTERPRISES, and
WHEREAS,
the Partners are each the owners of an interest in said Partnership as follows:
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XXXXXX
X. XXXXXXXXXX
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43.75%
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XXXXX
X. XXXXXXXXXX
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43.75%
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XXXXX
X. XXXXXXX
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6.25%
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XXXXXXX
X. X’XXXXX
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43.75%
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And
WHEREAS,
it is the desire of the Partners that upon the death of a Partner or his
withdrawal from the
Partnership
the remaining Partners shall continue the operation of said Partnership and
be
enabled to make payment of the fair value of the said Partner’s interest to him
or his estate.
NOW,
THEREFORE, in consideration of the foregoing, and intending to be legally
bound
hereby and to so bind their respective heirs, personal representatives and
assigns, the parties hereunto mutually covenant and agree as follows:
I.
GENERAL AGREEMENT.
Each
partner agrees not to sell, assign, transfer, convey, pledge or hypothecate
any
part of his partnership interest during his lifetime, unless the said interest
first shall have been offered for sale and/or purchase to the other Partners
as
hereinafter provided.
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S.O.C.O.
AGREEMENT
II.
INSURANCE
The
Partnership may insure the lives of the Partners naming itself as beneficiary
of
each such policy. The Partnership shall have the right to take out additional
insurance on the life of each such Partner whenever, in the opinion of the
Partnership, additional insurance may be required to carry out the obligations
of the Partnership. The Partnership shall pay all premiums on such life
il1surance policies and shall be the sole owner of the policies issued to
it and
may apply to the payment of premiums any dividends declared and paid on the
policies.
Upon
the
death of a Partner, the Partnership shall apply the proceeds from any such
insurance upon his life to the purchase of his Partnership interests in
accordance with the provisions hereinafter set forth.
Ill.
RESTRICTION ON DISPOSITION.
If
any
Partner desires to sell. assign, transfer, convey, pledge, hypothecate or
otherwise dispose of all or any part of his Partnership interest, he shall
first
offer the same for sale to the other Partners, by registered or certified
mail
by an instrument in writing, directed to the other Partners, addressed to
them
at the addresses designated herein, at a price to be determined as hereafter
set
forth. If said offer is not accepted by the other Partners within thirty
[30]
days of the mailing of same, the offeror shall have the right to solicit
a firm
offer to buy the shares owned by him from any other' person, firm or corporation
subject to the obligation of the offeror to reoffer his interest in the
partnership to the other Partners in the same manner hereinabove described,
at
the price offered by said other person, firm or corporation. If said reoffer
is
not accepted by the other Partners within thirty [30] days of the mailing
of the
same, the offeror shall have the right to sell his interest in the Partnership
at the same price and terms as were set forth in his reoffer to the other
Partners, discharged of this Agreement. Any interest in the Partnership not
so
disposed of shall once again become subject to the terms of this Agreement.
If
the other Partners accept the offer or reoffer, the purchase price shall
be paid
either on the terms offered in the reoffer notice or, at the option of the
other
Partners as hereinafter provided in the event of the death of a Partner.
Each
Partner shall be entitled to purchase a ratable share of the portion of the
partnership so offered. The ratable share of each such Partner shall be a
fraction, the numerator of which is the percentage of the Partnership owned
by
such Partner and the denominator of which is the percentage of the Partnership
owned by all of the Partners purchasing the interest so offered. Any portion
not
so purchased shall be allocated pro-rata among the other Partners desiring
to
purchase same. N no event may the Partners elect to purchase less than all
of
the portion of the Partnership offered by the offeror.
IV.
DEATH.
In
the
event of the death of a Partner, the personal representative of the deceased
Partner shall sell and the surviving Partners shall purchase all of the interest
of the deceased Partner in the Partnership. The portion of the Partnership
to be
so purchased shall be allocated and purchased pro-rata by the surviving Partners
(as more specifically described in Paragraph III hereof).
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S.O.C.O.
AGREEMENT
V.
ALLOCATION OF PROFIT AND LOSS.
Pending
the transfer of a Partnership interest to the continuing or surviving Partners,
the Partnership income shall be allocable to and Partnership losses shall
be
chargeable to the continuing Partners from the date the continuing Partners
accept the withdrawing Partner’s offer to sell or, in the event to the death of
a Partner, from the date of such Partner’s death.
VI.
VALUE
OF PARTNERSHIP INTEREST.
The
purchase price of a Partner’s interest in the Partnership shall be an amount
equal to the respective Partner’s Capital Account. The value of the Capital
Account shall be its book value as of the end of the month immediately preceding
the death of a partner or, in the event of an offer to sell, immediately
preceding the month in which such offer is received. Capital Account value
shall
be determined by the then accountant for the Partnership in accordance with
generally accepted accounting standards consistently applied; provided, however,
that the Capital Account value shall be adjusted upwards or downwards, to
reflect the fair market value of any real estate owned by the Partnership
as of
such date.
The
fair
market value of the real estate owned by the Partnership shall be determined
by
a qualified real estate appraiser mutually acceptable to the parties whose
determination shall be final and binding upon the Parties. If the parties
are
unable to agree on a qualified real estate appraiser, such value shall be
settled and finally determined by arbitration. In such event, the selling
Partner or the estate of the deceased Partner shall choose one such arbitrator;
the remaining or surviving Partners shall choose a second arbitrator and
those
arbitrators so chosen shall choose a third arbitrator. The decision of a
majority of the said there (3) arbitrators shall be final and binding on
the
parties.
VII.
CLOSING.
The
closing of any sale provided for in this Agreement shall be held ninety (90)
days after the event giving rise to the obligation of the Partners to purchase,
at the principal office of Muncy Homes, Inc., or at such other time and place
as
is mutually convenient to the parties. At such time, the buying Partners
shall
tender the purchase price as hereinafter provided and the selling Partner
or his
estate shall tender an assignment of his Partnership interest together with
such
deeds, bills of sale and other documents reasonable deemed necessary to fully
transfer title to the assets of the Partnership, free and clear of all liens
and
encumbrances.
The
purchase price shall be paid as follows:
A. At
closing, an amount equal to ten (10%) per cent of the purchase price shall
be
paid, in cash or by certified check. The balance of the purchase price shall
be
paid in nine (9) equal annual installments, commencing one (1) year from
the
closing date (the “Anniversary
Date”)
together with interest on the unpaid principal balance at the listed Wall
Street
Journal Prime Rate as of the respective anniversary date. In the event of
the
death of a Partner, the proceeds of any life insurance owned by the Partnership
on his life shall be paid toward the purchase price on the closing date and
the
remaining unpaid
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S.O.C.O.
AGREEMENT
balance
shall be paid ratably in nine (9) equal annual installments as aforesaid.
In the
event the life insurance proceeds exceed the purchase price, the excess shall
be
paid to the surviving Partners in proportion to their partnership interest
immediately after the closing date.
B. The
unpaid portion of the purchase price shall be evidenced by a series of nine
(9)
promissory notes setting forth the terms stated herein and providing for
an
acceleration of payment on all notes and for the confession of judgment on
all
notes in the event of a default of payment under any note. All said notes
shall
be executed by all of the purchasing or surviving Partners all of whom shall
be
jointly and severally liable thereon.
VIII. COLLECTION
OF INSURANCE PROCEEDS.
Upon
the
death of a Partner, the Partnership shall collect the proceeds of any and
all
policies of life insurance held by it on the life of such deceased Partner and
shall tender the net proceeds thereof at closing as herein above
provided.
IX. DISTRIBUTION
OF INSURANCE POLICIES.
In
the
event of the termination of this Agreement or in the event a Partner sells
his
Partnership interest, each said Partner shall have the right to purchase
the
policies on his life from the Partnership for an amount equal to its
interpolated terminal reserve value as of the respective effective
date.
X. TERMINATION
OF AGREEMENT.
This
agreement shall terminate upon:
A. The
written agreement of all of the Partners to that effect.
B. The
Partnership ceasing to do business or its insolvency, bankruptcy or
dissolution.
XI. AMENDMENT.
The
Partners, by unanimous agreement, may alter, amend, revoke or terminate this
Agreement in whole or in Part at any time, by their joint instrument in writing
to that effect.
XII. INSURANCE
COMPANY.
An
insurance company or companies which has issued or shall issue a policy or
policies deposited hereunder shall have no obligation to see to the performance
of the terms, covenants and condition of this Agreement, but shall be bound
only
to act in accordance with the terms of any policy or policies which it has
issued or may issue and shall have no liability except in accordance with
the
contract obligations as provided in said policies.
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S.O.C.O.
AGREEMENT
XIII.
BINDING
ON PARTNERS.
This
Agreement shall be binding upon the Partners, their heirs, executors,
administrators and assigns and they do agree for themselves, their heirs,
executors, administrators and assigns to execute any instruments and perform
any
acts necessary to effectuate this Agreement and its purposes.
XIV. PENNSYLVANIA
LAW.
This
Agreement shall be governed and construed by the Laws of the Commonwealth
of
Pennsylvania.
IN
WITNESS WHEREOF, the parties hereto have set their hands and seals the day
and
year first above written.
WITNESS:
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/s/
Xxxxxxx Xxxxx
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/s/
Xxxxxx X. Xxxxxxxxxx
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Xxxxxxx
Xxxxx
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Xxxxxx
X. Xxxxxxxxxx - Partner
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/s/
Xxxxxxxx Ansenich
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/s/
Xxxxx X. Xxxxxxxxxx
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Xxxxxxxx
Ansenich
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Xxxxx
X. Xxxxxxxxxx - Partner
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/s/
Xxxxxxx Xxxxx
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/s/
Xxxxx X. Xxxxxxx
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Xxxxxxx
Xxxxx
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Xxxxx
X. Xxxxxxx - Partner
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/s/
Xxxxxxx Xxxxx
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/s/
Xxxxxxx X. X’Xxxxx
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Xxxxxxx
Xxxxx
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Xxxxxxx
X. XXxxxx - Partner
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