Sale Of Shares Agreement for Australia

Sale Of Shares Agreement Template for Australia

A comprehensive legal agreement governed by Australian law that documents the terms and conditions for the sale and purchase of shares in a company. This document outlines the purchase price, conditions precedent, warranties, representations, and completion mechanics while ensuring compliance with the Corporations Act 2001 (Cth) and other relevant Australian legislation. It includes provisions for pre and post-completion obligations, warranty limitations, and typically contains detailed schedules covering company information, warranties, and disclosure matters.

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What is a Sale Of Shares Agreement?

The Sale Of Shares Agreement is a crucial document in Australian corporate transactions, used when transferring ownership of shares from one party to another. It is essential for both private and public company share transfers, though its complexity may vary depending on the transaction size and nature. The agreement must comply with Australian corporate law requirements, particularly the Corporations Act 2001 (Cth), and typically includes comprehensive provisions covering purchase price, warranties, indemnities, and completion mechanics. It's commonly used in merger and acquisition transactions, corporate restructuring, and investment deals, providing legal protection for both buyers and sellers while ensuring proper documentation of the ownership transfer process.

What sections should be included in a Sale Of Shares Agreement?

1. Parties: Identifies and defines the seller(s) and purchaser(s) of the shares

2. Background: Sets out the context of the transaction, including details of the company whose shares are being sold

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes interpretation principles

4. Sale and Purchase: Core provision establishing the agreement to sell and purchase the shares

5. Purchase Price: Details the consideration and payment terms, including any adjustments

6. Conditions Precedent: Specifies conditions that must be satisfied before completion can occur

7. Pre-Completion Obligations: Obligations of parties between signing and completion, including conduct of business requirements

8. Completion: Details of when, where and how completion will occur, including completion deliverables

9. Warranties: Seller's warranties about the shares, company, and business

10. Limitations on Claims: Limitations on warranty claims including time limits and financial thresholds

11. Confidentiality: Obligations regarding confidential information

12. Announcements: Requirements for public announcements about the transaction

13. Taxes and Costs: Allocation of transaction taxes and costs

14. General Provisions: Standard boilerplate clauses including notices, amendments, governing law

What sections are optional to include in a Sale Of Shares Agreement?

1. Post-Completion Adjustments: Mechanisms for adjusting the purchase price after completion based on completion accounts or other criteria

2. Earn-out Provisions: Details of any additional payments based on future performance

3. Employee Matters: Specific provisions dealing with key employees or employee arrangements

4. Intellectual Property: Special provisions regarding IP ownership and licensing

5. Non-Competition: Restrictions on seller's competing activities post-completion

6. Break Fee: Provisions for payment if the transaction fails to complete in certain circumstances

7. Guarantee: Parent company or personal guarantees for party obligations

8. Tag-Along/Drag-Along Rights: Rights for minority shareholders in case of partial share sales

9. Escrow Arrangements: Provisions for holding part of the purchase price in escrow

What schedules should be included in a Sale Of Shares Agreement?

1. Details of the Shares: Complete description of shares being sold including class, numbers, and certificates

2. Company Information: Details of the target company including corporate information and structure

3. Warranties: Detailed warranties about the company, business, and shares

4. Properties: Details of real estate owned or leased by the company

5. Material Contracts: List and details of important business contracts

6. Intellectual Property: Schedule of IP rights owned or licensed by the company

7. Employees: Details of employees including key terms of employment

8. Completion Obligations: Detailed list of documents and actions required at completion

9. Form of Resignation Letters: Template resignation letters for outgoing directors

10. Disclosed Matters: Matters disclosed against the warranties

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Australia

Publisher

Genie AI

Sector

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Financial Services

Technology

Manufacturing

Real Estate

Retail

Healthcare

Mining and Resources

Professional Services

Agriculture

Construction

Telecommunications

Energy

Transport and Logistics

Media and Entertainment

Relevant Teams

Legal

Finance

Corporate Development

Mergers & Acquisitions

Executive Leadership

Risk & Compliance

Company Secretariat

Business Development

Due Diligence

Treasury

Relevant Roles

Chief Executive Officer

Chief Financial Officer

General Counsel

Corporate Lawyer

M&A Director

Investment Manager

Company Secretary

Legal Counsel

Corporate Development Director

Finance Director

Business Development Manager

Transaction Manager

Due Diligence Manager

Risk Manager

Compliance Officer

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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