Share purchase Definition

GLOSSARY

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What does Share purchase mean?

Under a share purchase, the buyer takes over ownership of the target company (ie where it acquires its entire share capital) carrying on the business, which comes with all of its assets, obligations and liabilities (whether or not the buyer was aware of them).

View the related checklists about Share purchase

Drafting and negotiating an entire agreement clause—checklist

Drafting and negotiating an entire agreement clause—checklist This Checklist sets out key issues to consider, and provides practical guidance, when drafting and negotiating entire agreement clauses in a business-to-business (B2B) contract. It considers the implications of common law and statutory controls, including the Unfair Contract Terms Act 1977 (UCTA 1977) and the Misrepresentation Act 1967 (MA 1967). The purpose of an entire agreement clause is to give the parties certainty that the entirety of the agreement between them is set out in writing and to ensure that any pre-contractual representations, statements, arrangements or discussions will not form part of the agreement they are entering into. Statements are often made by one party to another as part of the pre-contract negotiations (for example as part of a sales process). Disputes can arise around whether, or which, statements are intended to form part of the contract or potentially give rise to other remedies. Depending on the facts, a pre-contractual statement might take legal effect (and give rise to remedies). For more information, see Practice Note: Pre-contractual representations and statements....

Starting a breach of warranty claim—checklist

Starting a breach of warranty claim—checklist This Checklist identifies the key factors that you should consider when advising a prospective claimant in relation to a potential breach of warranty claim arising out of a share purchase agreement (SPA). Similar principles will apply on an asset purchase agreement (APA). For further guidance on breach of warranty claims, please see the links to our related content on the right hand side. This Checklist should be read alongside Practice Note: Starting an SPA breach of warranty claim—a practical guide. Action Comments Review the SPA Check the:• governing/choice of law provisions—is the agreement subject to English law? • jurisdiction provisions—do the English courts have jurisdiction? • warranty provisions and warranty limitation provisions—does the issue fall within the scope of the warranties and are you within the time limit for bringing a breach of warranty claim?Make a note of all deadlines within the agreement that could be relevant with regard to any potential claim under the warranties. Review the disclosure letter Check that the...

Drafting and negotiating ancillary documents in a share purchase transaction

Drafting and negotiating ancillary documents in a share purchase transaction This Practice Note is part of the Share purchase transaction toolkit. In order to effect all aspects of the transaction, each share purchase transaction will require that certain ancillary documents be prepared (some of which will require more negotiation than others). These ancillary documents will either be drafted by the corporate lawyer drafting the share purchase agreement (SPA), or by a more junior colleague. Some will be entered into upon exchange and some upon completion (depending on whether or not these occur simultaneously). Ancillary documents include: • loan note instrument (where part of the consideration is to be satisfied with the issue of loan notes by the buyer) • board minutes (each of the buyer, seller and target company will need to hold board meetings to approve various matters at completion, with the buyer and seller also holding board meetings at exchange in order to approve entry into the SPA) • resolution of the members of...

Preparing for and conducting the completion meeting in a share purchase transaction

Preparing for and conducting the completion meeting in a share purchase transaction This Practice Note is part of the Share purchase transaction toolkit. At completion, the requisite formalities to complete and implement the transaction are undertaken, including the execution of the stock transfer form and delivery and execution of all completion deliverables as set out in the share purchase agreement (SPA). Exchange (the signing of the SPA) and completion may occur simultaneously or may be split, depending on whether the agreement for the transaction is unconditional or conditional, respectively. In addition, exchange and completion may occur in face-to-face meetings or virtually (via telephone and email). See Practice Note: Issues arising where there is split exchange and completion—share and asset purchases. Preparations for the completion meeting Prepare list of documents/completion agenda A list of documents, setting out the documents that need producing and detailing who has responsibility for producing each document, should be prepared well in advance of completion. The list should set out a timetable for...

Discover our 385 Practice Notes on Share purchase

Warranty limitations—pro-seller—share purchase agreement

Insert the following definitions as new definitions into clause 1 of Precedent: Share purchase agreement—pro-buyer—corporate seller—conditional—long form: 1 Definitions and interpretation Claim means a claim by the Buyer for any breach of the provisions of this Agreement (including a claim for breach of the Warranties); Data Room means the data room relating to the [Company OR Group] comprising all contracts, agreements, licences, documents and other information made available to the Buyer and its advisers, as listed in the Data Room index attached to the Disclosure Letter; The ScheduleLimitations on the Warranties ...

Property indemnity for a share purchase agreement

Property indemnity clause for insertion into a share purchase agreement Indemnity clause

Dive into our 163 Precedents related to Share purchase

What types of offences under the Proceeds of Crime Act 2002 (POCA 2002) should lawyers (who are acting in the 'regulated sector' under POCA 2002) and buyers be aware of in M&A transactions? If any such offence is identified as part of the due diligence process, what action should be taken and can this impact the timing of the transaction?

What types of offences under the Proceeds of Crime Act 2002 (POCA 2002) should lawyers (who are acting in the 'regulated sector' under POCA 2002) and buyers be aware of in M&A transactions? If any such offence is identified as part of the due diligence process, what action should be taken and can this impact the timing of the transaction? Under the Proceeds of Crime Act 2002 (POCA 2002), money laundering is defined as: • concealing, disguising, converting, transferring or removing criminal property out of the jurisdiction • entering into or becoming concerned in an arrangement that facilitates the acquisition, retention, use or control of criminal property, and • acquiring, using or possessing criminal property Money laundering is further defined in the Terrorism Act 2000. It is an offence to enter into or become concerned in an arrangement that facilitates the retention or control by or on behalf of another person of terrorist property: • by concealment • by removal from the jurisdiction • by...

When is a private company allowed to offer shares to the public? Would an offer to several investors or a group of high net worth individuals be construed as an offer to the public?

When is a private company allowed to offer shares to the public? Would an offer to several investors or a group of high net worth individuals be construed as an offer to the public? Prohibition of public offers by private company (Companies Act 2006, Part 20, Chapter 1) Under section 755(1) of the Companies Act 2006 (CA 2006) a private limited company must not: • offer to the public any securities (ie shares or debentures) of the company, or • allot or agree to allot any securities of the company with a view to their being offered to the public Further CA 2006, s 755(2) confirms that, unless proved otherwise, an allotment or agreement to allot securities will be presumed to be made with a view to their being offered to the public if an offer of the securities (or any of them) to the public is made: • within six months after the allotment or agreement to allot, or • before the receipt by the...

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Strike out and summary judgment in unfair prejudice petitions (Willoughby v Cole and another)

Dispute Resolution analysis: On an application for strike out and summary judgment of parts of a defence to a section 994 of the Companies Act 2006 (CA 2006) unfair prejudice petition, the court considered the extent to which historic misconduct might justify the removal and exclusion of a director. The Insolvency and Companies Court took a dim view of purported justifications dating back many years, even if serious at the time, and even if supported by more recent (but more modest) alleged wrongdoing. The petitioner's application was granted with orders for strike out and summary judgment. Written by Christopher Burt, legal director at Wedlake Bell LLP.

Singapore—Should a higher threshold apply for case management stays of applications to set aside arbitral awards? (DJA v DJB)

Arbitration analysis: What happens when an applicant seeks a case management stay of its own application to set aside an arbitral award in favour of a pending arbitration? Should a higher threshold apply? In this case, the court granted the case management stay of the setting aside application, and declined to apply a higher threshold for the grant of such an application. In determining whether to grant the stay, the court engaged in a balancing exercise of various factors, and gave helpful guidance on the factors it would consider in the grant of a case management stay. The court also examined the distinctions between case management stays and statutory stays under the Arbitration Act 2001 as a matter of source, scope and substance. This has various practical implications on the granting of case management stays. Written by Nandakumar Ponniya, Celeste Ang, principals at Baker & McKenzie Wong & Leow, and Danitza Hon, a senior associate at Baker & Mckenzie Wong & Leow.

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