It is a simple subscription contract for new shares in which the buyer does not need full guarantees on the condition of the company. He or she should already know the company very well, trust existing shareholders or buy at a price that greatly reduces risk. It is therefore an ideal document for situations such as: additional participation of an existing shareholder, employee buy-in or the entry of a parent into a family business. The document is suitable for companies in each sector and subscriptions of all sizes. A share sale agreement can be used when a shareholder sells to a buyer all the shares he owns in a company, if the purchaser is already an existing shareholder of the company. Subscribe to shares for new shares. Full buyer protection. Creating a majority or minority stake. All branches. Full version, warranty options extended by other shareholders. Conservation against poor performance. Other versions are available. A share purchase agreement is a contract that generally applies in writing and sets out all the conditions governing the sale of shares in a company.
It is important to determine whether the company in which the shares are held (the “company”) is a “regulated company,” as provided for in Part B – Corporate Panels and Regulations Authority, 2008. Home “Commercial law and corporate law” Creation of the sale of share contracts – Important considerations STT is levied up to 0.25% on the value of the transferred shares. There are several exceptions listed in Section 8 of the TWU Act. The most notable exceptions would be that the amount of TWU payable would be less than R100 (or, in other words, if the value of the shares transferred is less than R400) or if the shares are sold within the meaning of the company`s restructuring rules (securities transactions or intragroup transactions). Our model allows a cost-effective way to manage almost every aspect of stock sales, by providing a single table at the end, you can choose which parts of the agreement you want to include or exclude, as well as other customizable aspects. The knowledge of your client and your related persons is essential to the development of the sale of share contracts. For example, even low-value transactions between MMS may trigger a mandatory offer or require shareholder approval. If the sale also represents the share of the sale of all or most of the holding company`s assets, the shareholders of the holding company must also give their consent by way of a special decision. The agreement of the seller`s shareholders (and, if applicable, the shareholders of the seller`s holding company) is uncertain and the corresponding executive conditions must be included in the agreement. Pre-emption rights and restrictions can become complex.
Before you start writing your share sale, be sure to review the latest ME of the company in which the shares are held and ensure that there are no shareholder/other agreements that may limit the transfer of shares. If restrictions apply and these restrictions have not been addressed, be sure to consider the applicable conditions that may relate to them. A stake in a business consists of a set of personal incorporated rights against the company. These sets of rights are “transferred” by transfer and it is possible that rights against the company will be “transferred” at different levels between the seller and the buyer. If any of the exclusions mentioned in Section 112 (1) of the Companies Act 2008 do not apply, the seller`s shareholders must consent to the transaction when the seller sells part of his assets or businesses in full or more.