Share Purchase Agreements
This contract is a share purchase agreement between two parties, namely the board of directors of ABC limited who shall be referred to as the ‘company’ for the purposes of this share purchase agreement, and DEF who is an independent investor electing to purchase shares in ABC. DEF shall be referred to as the investor in this share purchase agreement.
1. Details of Transaction
As is customary with share purchase agreements, the company wishes to utilize this contract to raise additional funds for furthering their investment plans within the company. Towards this end, this share purchase agreement is being created with the following conditions:
1.1. Number of Shares being Transferred
This share purchase agreement provides for XXXX shares being transferred to the investor. These shares shall be categorized as normal shares with equal voting rights as all other shares in the company.
1.2. Share Price
According to share purchase agreements, the price of the transaction shall be specified. The rate per share payable by the investor is $ X per share. This is non negotiable and has been computed based on the average market rate of the shares for the preceding thirty days.
1.3. Payment Terms
The buyer shall make partial payment at the time of signing this agreement. This will serve as an act of good faith validating the share purchase agreement. On transfer of the shares, the buyer shall pay the remaining amount. Full details relating to the transaction are contained in Exhibit A of the annexure to this share purchase agreement.
2. Restrictions on the Buyer
As is common with share purchase agreements, the following restrictions shall be imposed upon the buyer on transfer of the shares.
2.1. The buyer may not transfer or resell the shares obtained for a period of 6 months after the transfer has taken place. During this lock in period, the shares shall remain in a trust under the control of both the buyer and the seller as per this share purchase agreement.
2.2. According to share purchase agreements, in case of death or incapacitation of the buyer, his heirs, successors or assigns may not resell the shares until such time as the lock-in period of six months is completed.
2.3. During the lock-in period of 6 months, the seller has the right to repurchase the shares from the buyer at rate at which it was sold or the market rate. The rate shall be chosen at the discretion of the buyer as per this share purchase agreement.
2.4. At the end of the lock-in period, share purchase agreements permit the buyer to sell, transfer or assign the shares to any third party as per his discretion.
3. Governing Law
As is customary with share purchase agreements, the terms and conditions of the clauses contained therein shall fall under the governing laws of the state in which it is applicable. Any clause found to be unlawful under the statutes of the state should be disregarded or reframed and considered unenforceable.
This share purchase agreement has been fully understood by both parties to the contract. It has been created in good faith and both parties waive any rights to contest or file suit against the other.
