- Length:27 pages (7800 words)
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About this document
This document is for selling or buying a single company of any size. It is an extremely authoritative and flexible document which can be used for high value transactions and for absolutely any sort of business.
Although this agreement is drawn for a buyer to use, it is also an incredibly valuable tool to either side of the transaction to give you an understanding of what should be in such an agreement and what possibilities there are for “tweaking” or deleting! If you have received such a document from the other party, buy this one now and improve your position.
The deal it covers is:
- part of the price is in shares of the buying company
- the company owns real property: full extra warranties cover this
- some part of the purchase price is retained by the buyer against warranted profit forecasts.
This version is very flexible in that you can negotiate from it and easily change the deal in several important ways.
Use the table below to select the version which best suits you. Note that the type of business is generally of low importance. You can use one of these templates to buy an architect's practice or a house-building company. If you are the seller, you will probably choose CPcsl05 so as to avoid commitment to future profit.
|Company or Group||All Shares Bought/Sold||Future Profit Guarantee||Part payment in shares||Price for target profit||Retention of part cash||Full Warranties||Co owns real property|
This document is CPcsl01.
With this document, we also send you a form of disclosure letter in this pack. This provides a format so that you can see how a disclosure letter works and a style you could use. The wording can be added easily.
In this agreement:
- The sellers may be individual shareholders or a corporate body but it is assumed that the buyer will be a corporate entity.
- the deal is for part price in shares of the buyer company, part cash retained against warranties for profit failure (three years); final price will be increased if year one profit target met.
A word about warranties:
Warranties protect the interest of the buyer, who does not have all of the information available to the seller. It is fair and reasonable for a buyer to demand warranties and for a seller to give them. However, it is quite easy for a buyer to use warranties to "improve" his original deal. So, if you are a seller do not give a warranty if you do not know whether or not it is true, but do be prepared to "go and find out" information that could be within your knowledge.
115 warranties sound an awful lot. Do you really need them? Will you understand them? Net Lawman advises: absolutely yes and absolutely yes! Our warranties are written in plain English. A seller should start with a full set unless he is sure he knows everything there is to know about his proposed acquisition, or the value is very small, or the company is not trading.
The document includes 115 individual warranties in sections relating to:
- No damaging effect of this agreement
- Company structure and operation
- Cash flow
- Guarantees and borrowing
- Trading and contracts
- Properties - all
- Properties let by the company
- Intellectual property
- Information technology
Use a shareholder agreement too
As this deal entitles the seller to receive shares, immediately on completion of this agreement, the seller should enter into a shareholders' agreement with the existing shareholders of the buyer. All of the detailed control is best exercised through a shareholder agreement.
Other similar templates
We also have:
- Agreement for sale
- Purchase price and how made up
- New shares to be issued by buyer
- The retention and the shortfall
- Additional price to be paid for performance over target
- Completion of the deal and delivery of documents
- Warranties applicability
- The warranties
- Trustees limited Warranties
- Restrictive agreement to prevent sellers from competing afresh
- Sellers protection provisions
- Various legal provisions usual in a document of this type
- Guarantee provisions
- Buyer acknowledgement of inspection
- The warranties
- Particulars of the properties
- Pension arrangements
- Sums for calculation of additional price