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Stock Purchase Agreement

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Stock Purchase Agreement

This Stock Purchase Agreement (this "Agreement") is made and entered into as of , by and between:

("Buyer"), and ("Seller").

Recitals

WHEREAS, Seller is the record and beneficial owner of all outstanding shares of common stock of the Target Companies, including Pioneer Security Life Insurance Company and Occidental Life Insurance Company of North Carolina;

WHEREAS, subject to the terms and conditions hereof, Seller desires to sell to Buyer, and Buyer desires to purchase from Seller, the Shares on the Closing Date; and

WHEREAS, the parties desire to set forth their agreement with respect to the purchase and sale of the Shares and related matters.

Article I. Definitions

Section 1.1. Definitions. For purposes of this Agreement, the term:

"AA Life" means .

"Acquisition Proposal" means any proposal or offer relating to a merger, sale, exchange, transfer, or similar transaction involving the Target Companies.

"affiliate" means a Person that controls, is controlled by, or is under common control with the specified Person.

"ALICO" means .

"Bankruptcy Resolution Date" means the date on which a Final Order of the Bankruptcy Court has been entered dismissing, closing or otherwise terminating a Chapter 11 Case.

"Business Day" means any day that is not a Saturday, Sunday or other day on which banking institutions are authorized or required to be closed.

"Chapter 11 Case" means a voluntary case commenced by Seller under chapter 11 of the Bankruptcy Code.

"Code" means the Internal Revenue Code of 1986, as amended.

"Disclosure Schedule" means the Disclosure Schedule attached hereto as Annex A.

"Environmental Law" means applicable environmental laws and regulations relating to hazardous materials, pollution, and environmental protection.

"Final Order" means an order or judgment that is not stayed and is no longer subject to appeal or rehearing.

"Governmental Authority" means any nation, government, state, subdivision, or entity exercising governmental functions.

"Hazardous Materials" means hazardous substances, petroleum, asbestos, and PCB-containing equipment.

"Insurance Companies" means the Target Companies identified in the Agreement.

"Liens" means any charge, claim, encumbrance, lien, pledge, security interest, or similar restriction.

"Losses" means demands, claims, actions, liabilities, losses, damages, costs, and expenses.

"Material Adverse Change" means a material adverse effect as defined in the Agreement.

"PennCorp" means .

"Person" means an individual or any other legal entity.

"Purchase Price" means the aggregate amount payable by Buyer for the Shares.

"SAP" means statutory accounting practices required or permitted by applicable insurance regulators.

"Target Companies" means ALICO and the Insurance Companies.

"Taxes" means all federal, state, local, foreign, and other taxes, charges, and similar governmental impositions.

Article II. The Acquisition

Section 2.1. Purchase and Sale of Shares. At the Closing, Seller will sell, assign, transfer and convey to Buyer, and Buyer will purchase and acquire from Seller, the Shares, free and clear of all Liens except Liens created by Buyer.

Section 2.2. Consideration for the Shares. The aggregate purchase price payable by Buyer for the Shares shall be as follows:

(i) in cash;

(ii) accrued interest at a rate of per annum;

(iii) less dividends paid by Occidental or AA Life after September 30, 1999;

(iv) less management fees paid after September 30, 1999;

(v) plus the value of net operating losses delivered at Closing;

(vi) plus if the Annex F assets are sold and replaced as required; and

(vii) plus the value of any liquid, investment grade assets acquired for the benefit of Buyer in replacement of the Southwestern Financial Corporation Preferred Stock.

Article III. Representations and Warranties of Seller

Seller represents and warrants that the statements contained in this Article III are correct and complete as of the date hereof and as of the Closing Date, subject to the Disclosure Schedule.

Section 3.1. Organization and Qualification.

(a) Seller and the Target Companies are duly organized and in good standing under the laws of their respective jurisdictions.

(b) The Insurance Companies are licensed to write the types of insurance and other products shown in the Disclosure Schedule.

Section 3.2. Authorization. Seller has full corporate power and authority to execute and deliver this Agreement and, if applicable, consummate the transactions contemplated hereby.

Section 3.3. No Violation. Except as set forth in the Disclosure Schedule, no execution, delivery, performance or consummation will violate organizational documents, agreements, or law.

Section 3.4. Capitalization of Pioneer.

Authorized common stock: .

Issued and outstanding common stock: .

Section 3.5. Subsidiaries. Disclosure Schedule identifies Pioneer subsidiaries and ownership interests.

Section 3.6. Consents and Approvals. Required governmental approvals are identified in the Disclosure Schedule.

Section 3.7. Financial Statements.

SAP Financial Statements have been delivered to Buyer.

ALICO Unaudited Financial Statements have been delivered to Buyer.

Unaudited Financial Statements have been delivered to Buyer.

Section 3.8. Absence of Undisclosed Liabilities. No material undisclosed liabilities exist except as stated in the Agreement.

Section 3.9. Absence of Certain Changes. Since September 30, 1999, the Target Companies have not taken actions outside the ordinary course except as disclosed.

Section 3.10. Litigation. No pending or threatened litigation exists except as disclosed.

Section 3.11. Property; Liens and Encumbrances. Owned and leased properties are free and clear of Liens except Permitted Liens.

Section 3.12. Certain Agreements. Material Contracts are listed in the Disclosure Schedule.

Section 3.13. Employee Benefits.

Target Employees as of November 1, 1999 are listed in the Disclosure Schedule.

Benefit Plans comply in all material respects with ERISA, the Code, and applicable law.

Section 3.14. Taxes. Except as disclosed, the Target Companies have timely filed Tax Returns and paid Taxes due.

Section 3.15. Compliance with Applicable Law. The business of each Target Company is being conducted in compliance with applicable law, except as disclosed.

Section 3.16. Brokers' Fees and Commissions. Wasserstein Perella & Co., Inc. is the only disclosed broker.

Section 3.17. Proprietary Rights. Target Companies own or have rights to use Intellectual Property required for their business.

Section 3.18. Insurance. Insurance policies are in full force and effect as described in the Disclosure Schedule.

Section 3.19. Environmental Matters. Environmental compliance and investigations are disclosed as required.

Section 3.20. Books and Records. Minute books and stock record books have been delivered or made available for inspection.

Section 3.21. Bank Accounts. Bank accounts and related relationships are listed in the Disclosure Schedule.

Section 3.22. Labor Matters. No labor disputes or collective bargaining issues exist except as disclosed.

Section 3.23. Year 2000 Compliance. The Target Companies believe Year 2000 issues will not have a material adverse effect.

Section 3.24. Termination of Intercompany Agreements. Intercompany agreements to be terminated are listed in the Disclosure Schedule.

Article IV. Representations and Warranties of Buyer

Section 4.1. Organization; Qualifications and Operations. Buyer is duly organized, validly existing and in good standing.

Section 4.2. Authorization. Buyer has power and authority to execute and deliver this Agreement and consummate the transactions contemplated hereby.

Section 4.3. No Violation. Buyer’s execution, delivery and performance will not violate its organizational documents, agreements, or law, except as would not have a Buyer Material Adverse Effect.

Section 4.4. Consents and Approvals. Required filings and approvals are limited as described in the Agreement.

Section 4.5. Brokers' Fees and Commissions. Buyer has not employed any investment banker, broker or finder in connection with the transactions contemplated hereby.

Section 4.6. Purchase for Investment. Buyer is acquiring the Shares for investment purposes and understands transfer restrictions.

Section 4.7. Financing.

Bank of America commitment letter attached as Annex B.

Bank of America "Highly Confident" letter attached as Annex C.

Thoma Cressey Equity Partners commitment letter attached as Annex D.

Article V. Covenants

Section 5.1. Conduct of Business Prior to the Closing. Seller shall cause each Target Company to conduct business in the ordinary course and preserve assets, employees, and relationships.

Section 5.2. Access to Information. Seller shall provide Buyer access to premises, books, records, and information reasonably requested.

Section 5.3. HSR Act Filings. The parties shall make the required HSR Act filings within 10 Business Days.

Section 5.4. Regulatory Approvals. Buyer shall file required applications and use reasonable best efforts to obtain approvals.

Section 5.5. All Reasonable Efforts. Each party shall use reasonable efforts to consummate the transactions contemplated hereby.

Section 5.6. Public Announcements. Public statements require consultation and mutual agreement except as required by law.

Section 5.7. Disclosure Supplements. Seller may supplement or amend the Disclosure Schedule as permitted.

Section 5.8. No Implied Representations or Warranties. Only the express representations and warranties in this Agreement apply.

Section 5.9. Employment and Employee Benefits.

Buyer shall assume obligations relating to Target Employees after the Closing.

Benefit Plans relating to Target Employees shall be treated as Buyer Plans.

Buyer shall provide benefits substantially comparable to those provided before Closing.

Target Employees shall receive service credit as described in the Agreement.

Buyer shall cause a 401(k) plan to accept eligible rollover contributions.

Section 5.10. Acquisition Proposal. Seller shall not solicit or encourage competing proposals except as permitted for Superior Proposals or Recapitalization Transactions.

Section 5.11. Bankruptcy Court Approval.

Seller shall seek entry of the Approval Order and Sale Procedures Order if a Chapter 11 Case is commenced.

The Approval Order shall include the protections, findings, and injunctions described in the Agreement.

Section 5.12. Consulting. Seller shall consult with Buyer concerning the conduct of business operations prior to Closing.

Section 5.13. Allocation of Purchase Price. The parties shall agree upon the allocation of the Purchase Price or submit the dispute to an independent accounting firm.

Article VI. Closing Conditions

Section 6.1. Conditions to the Obligations of Buyer under this Agreement.

(a) Required authorizations, consents and approvals shall have been obtained.

(b) Any applicable HSR Act waiting period shall have expired or been terminated.

(c) No injunction or legal restraint preventing consummation of the Acquisition shall be in effect.

(d) Seller’s covenants shall be performed and its representations and warranties shall be true and correct, subject to the stated standards.

(e) Pioneer shall have completed the required disposition of Security Life and the Restructuring Transactions.

(f) Intercompany agreements shall have been terminated or rejected as required.

(g) Seller shall have delivered a Closing Statement at least three days before Closing.

(h) Required Closing Capital shall be satisfied.

(i) If a Chapter 11 Case is commenced, the Approval Order shall have become a Final Order.

Section 6.2. Conditions to the Obligations of Seller under this Agreement.

(a) Pioneer shall have completed the required disposition and restructuring.

(b) Required third-party and governmental approvals shall have been obtained.

(c) HSR Act waiting periods shall have expired or been terminated.

(d) No injunction preventing consummation of the Acquisition shall be in effect.

(e) Buyer’s covenants shall be performed and its representations and warranties shall be true and correct.

(f) Buyer shall assume obligations with respect to Benefit Plans for Target Employees.

(g) Buyer shall assume certain insurance policies through reinsurance contracts.

(h) If a Chapter 11 Case is commenced, the Approval Order shall have become a Final Order.

Article VII. Closing

Section 7.1. Closing. The Closing shall take place at the offices of Weil, Gotshal & Manges LLP, 767 Fifth Avenue, New York, New York 10153, or such other place and time as the parties may agree.

At the Closing:

(a) Seller shall deliver the required certificates and stock powers;

(b) Buyer shall deliver the required certificate; and

(c) Buyer shall pay the Purchase Price by wire transfer of immediately available funds.

Article VIII. Survival

Section 8.1. Survival of Representations, Warranties and Covenants.

(a) Pre-Closing representations, warranties and covenants shall not survive the Closing.

(b) Post-Closing covenants survive indefinitely unless a specified period is stated.

Article IX. Termination and Abandonment

Section 9.1. Termination Payment.

(a) If terminated under specified Sections, Seller shall pay Buyer the Termination Amount of .

(b) If terminated under specified Bankruptcy-related provisions, Seller may be obligated to pay the Bankruptcy Termination Amount and certain expenses, subject to Bankruptcy Court approval.

Section 9.2. Termination. The Agreement may be terminated prior to Closing under specified conditions.

(a) by consent of Seller and Buyer;

(b) by Seller or Buyer under specified circumstances;

(c) by Buyer upon Seller default, certain conditions failing, or a Material Adverse Change;

(d) by Seller upon Buyer default, certain conditions failing, or Superior Proposal/Recapitalization Transaction events.

Section 9.3. Procedure and Effect of Termination. Upon termination, written notice shall be given and the Agreement terminates without further action, subject to specified surviving obligations.

Section 9.4. No Default. No default shall arise from the commencement or pendency of a Chapter 11 Case or failure to commence a Chapter 11 Case.

Article X. Miscellaneous Provisions

Section 10.1. Amendment and Modification. This Agreement may be amended only by a written instrument signed by all parties.

Section 10.2. Waiver of Compliance; Consents. Waivers must be in writing and do not constitute waiver of other failures.

Section 10.3. Severability. Invalid provisions shall not affect the remainder of the Agreement if the economic or legal substance remains intact.

Section 10.4. Expenses and Obligations. Each party bears its own expenses.

Section 10.5. Parties in Interest. The Agreement benefits only the parties and their permitted successors and assigns.

Section 10.6. Notices.

Buyer notice information:

Thoma Cressey Equity Partners

Sears Tower, 44th Floor, 233 South Wacker Drive, Chicago, IL 60606-6303

Attention: Carl D. Thoma

Facsimile: (312) 777-4421

Seller notice information:

American-Amicable Holdings Corporation, c/o Southwestern Financial Services Corp.

717 North Harwood Street, Dallas, Texas 75201-6538

Attention: Scott D. Silverman, Esq.

Facsimile: (214) 954-7906

Section 10.7. Governing Law. This Agreement shall be governed by the laws of the State of New York.

Section 10.8. Counterparts. This Agreement may be executed in counterparts.

Section 10.9. Headings. Headings are for reference only and do not affect interpretation.

Section 10.10. Entire Agreement. This Agreement and its annexes constitute the entire agreement between the parties.

Section 10.11. Assignment. Assignment is restricted except as permitted to Buyer’s affiliate.

Section 10.12. Third Party Beneficiaries. No third party beneficiaries except as expressly stated.

Section 10.13. Construction. This Agreement was jointly drafted and shall not be construed against either party.

Article XI. Tax Matters

Section 11.1. Tax Sharing Agreements. Any tax sharing agreements between Seller and the Target Companies terminate as of the Closing Date.

Section 11.2. Preparation of Tax Returns; Payment of Taxes.

Seller prepares and pays for pre-Closing Tax Returns and Taxes.

Buyer prepares and pays for post-Closing Tax Returns and Taxes.

Section 11.3. Special Provisions Affecting Security Life.

Buyer shall pay to Security Life any tax refund arising from certain carrybacks and shall indemnify Seller for specified Tax liabilities.

Section 11.4. Post-Closing Elections. Buyer shall make or join in certain tax elections requested by Seller if materially acceptable.

Signatures

PIONEER-OCCIDENTAL HOLDINGS COMPANY

By:

Title:

Date:

AMERICAN-AMICABLE HOLDINGS CORPORATION

By:

Title:

Date:

Additional acknowledgements:

Notes or comments:

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What a Stock Purchase Agreement Is and when it's used

A Stock Purchase Agreement (SPA) is a legal contract that documents the sale and transfer of shares from a seller to a buyer, specifying price, number of shares, closing conditions, representations, warranties, indemnities, and post-closing obligations. SPAs govern private stock transfers, negotiated acquisitions, and buy-sell transactions and often include schedules and exhibits such as cap tables, certificate endorsements, and shareholder consents to effect ownership changes and protect both parties against undisclosed liabilities.

Why a clear Stock Purchase Agreement matters

A well-drafted SPA allocates risk, sets performance expectations, preserves corporate formalities for share transfer, and reduces post-closing disputes by documenting price, closing conditions, and remedies in a single binding agreement.

Why a clear Stock Purchase Agreement matters

Who commonly prepares and signs a Stock Purchase Agreement

Each party should coordinate legal, tax, and corporate-record updates to ensure the transfer is effective and documented in corporate books.

  • Founders and investors negotiating ownership changes and purchase price adjustments during a financing or exit.
  • Corporate legal teams preparing representations, warranties, and board resolutions needed to approve transfer.
  • CFOs and transfer agents managing payment, share certificate endorsement, and record updates.

Typical roles that sign the agreement

Founder / Seller

A founder or individual shareholder signs to transfer their shares and confirm representations about ownership and authority. The seller typically warrants title, absence of liens, and authority to sell, and must coordinate certificate endorsements and stock ledger updates.

Buyer / Investor

A buyer or investor signs to accept the shares, make payment, and agree to post-closing covenants. Buyers often require closing conditions such as board approvals, consents, and delivery of duly executed instruments of transfer.

Core sections you should expect in a professional SPA

A complete SPA organizes commercial terms, legal protections, closing mechanics, and post-closing obligations into discrete, searchable sections so parties can locate obligations and enforce remedies quickly.

Purchase Price

Specifies total consideration, per-share price, deposit/escrow mechanics, payment schedule, and any contingent adjustments tied to earnouts or closing reconciliations to avoid ambiguity at funding.

Shares and Consideration

Describes class and number of shares, any restrictions on transfer, issuance of new certificates, and whether payment includes cash, promissory note, or other non-cash consideration.

Representations & Warranties

Seller and buyer statements about corporate authority, title, compliance with laws, and absence of undisclosed liabilities that allocate pre-closing risk and trigger indemnity claims if breached.

Closing Conditions

Lists required approvals, consents, deliverables, and regulatory filings that must be satisfied or waived before the transaction becomes effective to avoid premature transfer.

Indemnification

Defines scope, survival period, caps, baskets, and procedures for notice, defense, and settlement of claims to manage post-closing loss allocation between parties.

Governing Law & Dispute Resolution

Specifies the state law that interprets the SPA, venue, and whether arbitration or court litigation will resolve disputes, which affects enforceability and remedies.

Step-by-step: completing and closing a Stock Purchase Agreement

Follow a clear sequence to negotiate, document, and close the transaction; ensure corporate approvals and transfer mechanics are completed before funds or certificates change hands.

  • 01
    Negotiate Terms: Agree on price, shares, and key representations before drafting the SPA.
  • 02
    Draft and Review: Prepare the SPA, attach exhibits, and have counsel review for tax and securities risk.
  • 03
    Satisfy Conditions: Obtain board approvals, third-party consents, and any required filings or waivers.
  • 04
    Closing & Transfer: Exchange payment, endorse certificates or update ledger, and retain executed originals for records.

Configuring an online signing workflow for the SPA

Set clear signer order, authentication strength, and required fields to produce a tamper-evident executed agreement and a complete audit trail.

Field Configuration
Signer Order Sequential signing to ensure buyer then seller signs in proper order
Authentication Use email plus SMS code or ID verification for higher assurance
Conditional Fields Show payment or escrow fields only when applicable to streamline signer experience
Audit Trail Capture timestamps, IPs, and actions for enforceability and recordkeeping

Typical online signing flow for a Stock Purchase Agreement

An e-signature workflow moves the SPA from draft to executed record while preserving authentication and audit details necessary for legal validity and corporate record updates.

  • Upload Document: Import the SPA in PDF or DOCX format
  • Place Fields: Add signature, date, and initial fields where required
  • Set Authentication: Select email, SMS code, or advanced methods
  • Send & Capture: Distribute to signers and retain completed audit trail

Technical requirements for secure e-signing and e-submission

Ensure the chosen platform provides an auditable certificate of completion, secure storage, and export options to retain an official signed copy for corporate records.

  • File Formats: PDF and DOCX widely supported for signed SPA documents
  • Integrations: Connectors to Salesforce, NetSuite, Google Workspace, and Box streamline record updates
  • Authentication Options: Email, SMS, KBA, or advanced signer verification available

Security and compliance considerations for handling SPAs

Encryption: TLS 1.2/1.3 in transit; AES-256 at rest
SOC 2: SOC 2 Type II certification available
ISO 27001: ISO 27001 information security standard compliance
HIPAA: HIPAA-compliant workflows with BAA where applicable
ESIGN/UETA: Meets ESIGN and UETA legal requirements
21 CFR Part 11: Supports FDA-regulated digital record controls

Common drafting and execution pitfalls to avoid

  • Using informal or abbreviated party names that do not match formation or ID documents, causing transfer and tax reporting delays.
  • Failing to include required exhibits (cap table, certificate endorsements, consents), which can block closing or create ambiguity about shares transferred.
  • Neglecting pre-closing corporate approvals and shareholder consents, resulting in voidable transfers or breach of corporate bylaws.
  • Omitting post-closing obligations such as covenant timeframes, escrow release conditions, or indemnity procedures, increasing dispute risk.

Immediate risks if the SPA is incorrect or incomplete

Invalid Transfer: Share transfer may be ineffective
Tax Liability: Unreported consideration triggers penalties
Breach Claims: Buyer or seller may sue for damages
Regulatory Risk: Securities filing failures may incur sanctions
Delay to Closing: Missing consents can postpone funding
Recordkeeping Gaps: Corporate books remain inaccurate

Real-world examples of SPAs in action

Representative customer experiences show how SPAs are used to finalize equity transfers while maintaining compliance and record integrity.

Optica Ventures — COO

The interface is simple and easy-to-use for our team; more importantly, it is just as easy for our customers.

  • The system reduced turnaround time on investor share transfers.
  • Optica used online execution to collect signatures, update ledgers, and store signed SPA copies securely for regulatory and audit purposes.

Martin Properties — Founder

I can process and execute all of these documents online with 100% compliance and built-in security.

  • Mobile signing enabled completions on-site and remotely.
  • Martin Properties closed multiple equity adjustments without in-person meetings, retained audit trails, and updated ownership records immediately after closing.

Representative eSignature vendor comparison for signing SPAs

Comparison of starting price and selected features relevant to executing Stock Purchase Agreements; signNow is listed first as the baseline for feature and price checks.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial Varies by vendor Varies by vendor Varies by vendor Varies by vendor
Bulk Send Yes Yes Yes Yes Yes
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Practical tips to finalize a clean, enforceable SPA

Small drafting and process measures reduce closing friction and legal exposure; follow disciplined review and recordkeeping practices.

Confirm party identities and authority
Verify entity names and signatory authority against formation documents and corporate minutes; obtain officer certificates where applicable to confirm board approval.
Attach concise exhibits
Include a cap table, stock certificate copies, and required consents as exhibits to make obligations and mechanics immediate and discoverable.
Preserve an audit trail
Use an eSignature platform that records timestamp, IP, and signer verification to support attribution and reduce later disputes over authenticity.
Coordinate tax and securities advisors
Engage counsel or accountants early to assess Form D, withholding, reporting, and transfer tax implications for both buyer and seller.

Key dates and timing items to track when closing an SPA

Identify critical dates—effective date, due diligence cut-off, closing date, and post-closing delivery timelines—and record them consistently in the SPA.

Effective Date:

Date the parties agree the SPA takes effect; use MM/DD/YYYY

Due Diligence Cutoff:

Deadline for buyer to complete investigations before walking away

Closing Date:

Date for exchange of funds, certificates, and deliverables

Post-Closing Deliverables:

Timelines for escrow releases, indemnity notices, and ledger updates

Tax Reporting:

Schedule required tax filings and 1099 reporting timelines where payments trigger reporting obligations

Milestone timeline from negotiation to recorded transfer

Track sequential closing milestones to coordinate approvals, payment, and record updates without unnecessary delay.

01

Negotiation

Agree on commercial terms and produce a draft SPA for review

02

Due Diligence

Buyer completes validation of financials, title, and compliance matters

03

Signing

Parties execute the SPA and related closing documents

04

Closing & Recording

Exchange consideration, update stock ledger, and deliver endorsed certificates

Frequently asked questions about Stock Purchase Agreements

Answers to common legal, practical, and process questions encountered when drafting or executing an SPA.


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