Share Sale and Purchase Agreement - Sale of a Percentage of Existing Shares
This Share Sale and Purchase Agreement – Sale of a Percentage of Existing Shares is different from all the other share sale and purchase agreements in this subfolder in that this template relates to the sale of a part or percentage of a company rather than a sale of 100% of the shares in a company and where the original shareholders are exiting the business.
This agreement has therefore been drafted with the following assumptions:
- the seller holds 100% of the current issued share capital;
- the seller is selling an amount of these shares to the buyer;
- the selling percentage amounts to not more than 20% of the issued share capital in the company. At this percentage level no meaningful control of the company is lost and there is no need for PSC registration by the buyer. However note that in selling these shares to the buyer, the seller will be diluting his shareholding in the company;
- there is no issue of new share capital, rather this is a sale of existing shares. For a company proposing to issue new shares, our Share Investment Agreement (Cash) may be more appropriate; and
- no tax covenant has been included. Customers may need to consider seeking separate tax advice.
This is a short form basic agreement which includes the following clauses:
- Definitions & Interpretation
- Agreement for Sale and Purchase
- Buyer’s Director
- Limitations on Claims
- Confidential Information
- Rights of Third Parties
- Conflict with Articles
- Entire Agreement
- No Partnership
- Governing Law & Jurisdiction
And the following schedules:
- Schedule 1 – the Company
- Schedule 2 – Consideration
- Schedule 3 – Post Completion Shareholdings
- Schedule 4 – Warranties
This document is in open format. Fields should be completed and wording in square brackets is optional and can be deleted or retained according to requirements.
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