All existing disputes, arbitrations or judgments, pending or imminent, with the amounts concerned. All disputes in the last five years and related amounts. details of all accidents in the workplace, material infringements occurring under an agreement or arrangement involving the company, all formal insolvency proceedings, including bankruptcy, liquidation, judicial administration, administration or system with creditors that relate to the business. In some situations, it may be necessary to make the conclusion of the share purchase agreement subject to certain issues, such as. B obtaining tax decommitments or administrative authorisation, so that, in that case, normally suspensive conditions would be included in the contract. Since the general “Buyer be careful” rule applies to the sale of shares, the law does not offer much protection to the buyer when unexpected debts or problems are revealed after the sale of the business. In order to protect the buyer from such unexpected costs, a SPA contains extensive warranties of the seller, in which he makes statements and commitments about the state of the business and assets of the company, and perhaps compensation in favor of the buyer allowing him to recover losses from the seller. This is important because it is a written agreement that is binding and reduces misunderstandings between the parties. The ownership of the sellers can be proven by this agreement and this gives confidence to the buyer. It should never be fore view that the main purpose of the warranty is to impose legal liability on the seller and to remedy the buyer`s situation when statements about the targeted business prove to be erroneous. The SPA focuses on the agreement for the seller to sell the shares of the target company and the buyer to buy.
Normally, the seller agrees to sell the shares “with full ownership guarantee” – this particular period has the effect that the seller owns the shares in full, has the right to sell them, will do everything in his power to transfer it to the buyer, and the shares are not subject to third party rights or restrictions. The transfer of shares in companies to a new shareholder (also called a member), whether by sale or donation, is widespread in UK private companies. When it comes to buying and selling businesses, one of the easiest ways to transfer ownership is by selling the company`s shares. This is because while the ownership of the business may change, the day-to-day operations of the business continue, with employees, contracts and ownership remaining in the business. Covenants can be negative or positive and offer each of the parties a certain degree of comfort compared to their past and proposed measures regarding the SPA. Covenants are also required of the buyer by the seller with respect to the management of the business between the signature and the financial statements. Acts authorized during this period usually require the agreement of the buyer, although the business is still technically managed by the seller. When someone sells their shares in a company, they often hope to get a clean breakup.
However, since some corporate commitments – especially when it comes to taxes – are only revealed after the transaction, buyers need to make sure that outgoing owners stay on the hook, and this is one of the main purposes of the main sale document, the share sale agreement. Example – if there is a partnership, “an allocation of partnership interests” can be used or, in one case, if there are two partners and both partners have equal shares and one of the partners decides to leave the partnership, a share purchase agreement can be used to buy the shares of the company. . . .