Membership Interest Sales Agreement for Canada

Membership Interest Sales Agreement Template for Canada

A Canadian Membership Interest Sales Agreement is a legally binding document that facilitates the transfer of ownership interests in a business entity from a seller to a buyer. This agreement, governed by Canadian federal and provincial laws, outlines the terms and conditions of the sale, including purchase price, payment terms, representations and warranties, and closing conditions. It incorporates specific Canadian legal requirements, such as compliance with provincial securities regulations, federal tax laws, and where applicable, Investment Canada Act considerations for foreign buyers. The document serves as a comprehensive framework for the transaction, protecting both parties' interests while ensuring regulatory compliance.

Your data doesn't train Genie's AI

You keep IP ownership of your information

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

Download a Standard Template

4.6 / 5
4.8 / 5
Access for free
OR

Alternatively: Run an advanced review of an existing
Membership Interest Sales Agreement

Let Genie AI's market-leading legal AI identify missing terms, unusual language, compliance issues and more - in just seconds.
Upload your Doc

What is a Membership Interest Sales Agreement?

The Membership Interest Sales Agreement is a crucial document used in Canadian business transactions when transferring ownership interests in a company. This agreement is particularly relevant when selling partial or complete ownership in limited liability companies, partnerships, or other business entities where ownership is defined through membership interests rather than shares. The document must comply with Canadian federal legislation including the Income Tax Act and potentially the Investment Canada Act, as well as provincial securities regulations. It typically includes detailed provisions about the transaction structure, purchase price, representations and warranties, closing conditions, and post-closing obligations. The agreement is essential for documenting the terms of the sale, protecting both parties' interests, ensuring proper transfer of ownership, and maintaining compliance with relevant Canadian laws and regulations.

What sections should be included in a Membership Interest Sales Agreement?

1. Parties: Identifies and defines all parties to the agreement, including seller(s) and buyer(s)

2. Background: Provides context for the transaction, including description of the business entity and membership interests being sold

3. Definitions: Defines key terms used throughout the agreement

4. Purchase and Sale: Details the membership interests being sold and the purchase price

5. Purchase Price and Payment: Specifies the amount, payment method, and timing of payments

6. Closing: Sets forth the closing date, deliverables, and procedures

7. Representations and Warranties of Seller: Seller's statements about the company, membership interests, and authority to sell

8. Representations and Warranties of Buyer: Buyer's statements about authority and capacity to purchase

9. Covenants: Pre-closing and post-closing obligations of the parties

10. Conditions to Closing: Prerequisites that must be met before the transaction can close

11. Indemnification: Provisions for compensating parties for losses arising from breaches or misrepresentations

12. Termination: Circumstances under which the agreement can be terminated and consequences

13. General Provisions: Standard legal provisions including governing law, notices, amendments, etc.

14. Execution: Signature blocks and execution requirements

What sections are optional to include in a Membership Interest Sales Agreement?

1. Purchase Price Adjustment: Used when the purchase price may be adjusted based on working capital or other financial metrics

2. Earn-out Provisions: Include when part of the purchase price is contingent on future performance

3. Employee Matters: Required when there are specific agreements regarding retention or termination of employees

4. Tax Matters: Include detailed tax provisions when complex tax implications exist

5. Non-Competition and Non-Solicitation: Used when restricting seller's future business activities

6. Transition Services: Include when seller will provide post-closing services

7. Third Party Consents: Required when material contracts or licenses need third party approval for transfer

8. Environmental Matters: Include for businesses with significant environmental considerations

9. Intellectual Property: Required when IP assets are material to the business

What schedules should be included in a Membership Interest Sales Agreement?

1. Schedule A - Membership Interests: Detailed description of membership interests being transferred

2. Schedule B - Purchase Price Allocation: Breakdown of purchase price allocation for tax purposes

3. Schedule C - Company Financial Statements: Recent financial statements of the company

4. Schedule D - Material Contracts: List and copies of material contracts

5. Schedule E - Permitted Encumbrances: List of allowed liens or encumbrances on company assets

6. Schedule F - Intellectual Property: List of IP assets owned or licensed by the company

7. Schedule G - Real Property: Details of owned or leased real estate

8. Schedule H - Employee Information: List of employees and employment terms

9. Schedule I - Required Consents: List of required third-party approvals

10. Schedule J - Disclosure Schedule: Exceptions to representations and 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

Canada

Publisher

Genie AI

Cost

Free to use
Clauses
Relevant Industries

Private Equity

Venture Capital

Professional Services

Manufacturing

Technology

Real Estate

Healthcare

Retail

Energy

Agriculture

Mining

Financial Services

Construction

Transportation

Hospitality

Relevant Teams

Legal

Finance

Corporate Development

Mergers & Acquisitions

Tax

Compliance

Risk Management

Business Development

Executive Leadership

Treasury

Corporate Secretariat

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Corporate Lawyer

Legal Counsel

Business Development Manager

Investment Manager

Managing Partner

Private Equity Manager

Mergers & Acquisitions Director

Business Owner

Company Secretary

Transaction Advisory Manager

Due Diligence Specialist

Corporate Development Director

Risk Management Officer

Tax Director

Compliance Officer

Industries
Securities Act (Provincial): Regulates the trading and transfer of securities, including membership interests, within provinces. Each province has its own Securities Act.
Income Tax Act (Federal): Governs tax implications of membership interest transfers, including capital gains treatment and tax obligations for both buyer and seller.
Canada Business Corporations Act (CBCA): Federal legislation governing corporate entities and their ownership structures, including transfer of interests and corporate governance requirements.
Provincial Business Corporations Act: Provincial legislation governing corporations registered within the province, including rules for transfer of ownership interests.
Competition Act: Federal legislation that may apply if the membership interest sale reaches certain thresholds, requiring potential review or notification.
Investment Canada Act: Applies to foreign investors purchasing Canadian business interests, potentially requiring government review and approval.
Personal Information Protection and Electronic Documents Act (PIPEDA): Federal privacy law that may apply to personal information shared during due diligence and transaction processes.
Excise Tax Act: Federal legislation governing GST/HST implications of membership interest transfers.
Provincial Personal Property Security Act: Governs security interests in personal property, relevant if the membership interests are being pledged as security.
Proceeds of Crime (Money Laundering) and Terrorist Financing Act: Federal legislation requiring due diligence and reporting for certain business transactions to prevent money laundering.
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

Find the exact document you need

State Approved Real Estate Purchase And Sale Agreement

A provincially-approved standard agreement for real estate transactions in Canada that governs the legal transfer of property between seller and buyer.

find out more

State Approved Purchase And Sale Agreement

A standardized Canadian legal document for real estate transactions that governs the transfer of property between buyers and sellers under federal and provincial regulations.

find out more

Sellers Agreement For House

A Canadian legal agreement outlining terms and conditions for the sale of residential property, compliant with federal and provincial real estate laws.

find out more

Selling A Car Letter Agreement

A Canadian-compliant letter agreement documenting the sale and purchase of a motor vehicle, including essential terms and conditions for legal transfer of ownership.

find out more

Purchase Agreement For Vacant Lot

A Canadian legal agreement for the purchase and sale of vacant land, outlining transaction terms and conditions under federal and provincial jurisdiction.

find out more

Dental Practice Asset Purchase Agreement

A Canadian legal agreement for the purchase and sale of dental practice assets, including tangible and intangible assets, ensuring compliance with healthcare and business regulations.

find out more

Contract To Buy Land

A legally binding agreement for land purchase in Canada, outlining terms and conditions for property transfer in accordance with federal and provincial laws.

find out more

Car Sales Agreement Contract

A Canadian-law governed agreement that documents the terms and conditions for the sale and purchase of a motor vehicle, ensuring legal compliance and protecting both parties' interests.

find out more

Land Buying Agreement Form

A legally binding agreement for land purchase and transfer in Canada, outlining all essential terms and conditions of the transaction while ensuring compliance with federal and provincial regulations.

find out more

Installment Sales Contract (Real Estate)

A Canadian contract governing the sale of real estate through installment payments, compliant with federal and provincial regulations.

find out more

Letter Of Agreement For Sale Of Land

A Canadian legal document formalizing the essential terms and conditions for the sale of land between a vendor and purchaser, creating binding obligations under provincial property laws.

find out more

Business Sale Contract

A Canadian law-governed agreement facilitating the complete transfer of business ownership, detailing all aspects of the sale transaction including assets, liabilities, and obligations.

find out more

Cross Purchase Buy Sell Agreement

A Canadian-law governed agreement establishing terms for business owners to buy out each other's interests upon specific triggering events.

find out more

Real Estate Purchase Contract Form

A legally binding Canadian real estate contract that documents the terms and conditions for property purchase and sale transactions, ensuring compliance with federal and provincial regulations.

find out more

Purchase Sale Contract

A Canadian law-governed agreement documenting terms and conditions for the sale and purchase of goods between two parties, including product specifications, pricing, delivery, and warranties.

find out more

Personal Property Sale Agreement

A Canadian law-governed agreement documenting the sale and purchase of personal property, including terms, conditions, and transfer of ownership provisions.

find out more

Owner To Owner House Sale Contract

A Canadian-law governed contract for direct property sale between private owners, outlining terms, conditions, and requirements for residential property transfer.

find out more

Mobile And Manufactured Home Purchase Agreement And Sales Contract

A Canadian legal agreement for the purchase and sale of mobile or manufactured homes, ensuring compliance with federal and provincial regulations while protecting both buyer and seller interests.

find out more

House Sales Contract On For Sale By Owner

A legal contract for private residential property sales (For Sale By Owner) in Canada, covering all essential elements required for valid property transfer under Canadian law.

find out more

Conditional Sale And Purchase Agreement

A Canadian law-governed agreement for asset sales where title transfers upon meeting specified conditions, typically full payment, while complying with federal and provincial regulations.

find out more

Confidentiality Agreement For Sale Of Business

Canadian-law governed confidentiality agreement protecting sensitive information during business sale processes and due diligence.

find out more

Agreement To Sell Personal Property

A Canadian legal agreement governing the sale and transfer of personal property between parties, compliant with provincial and federal legislation.

find out more

Sales And Purchase Agreement Word Document

A Canadian-compliant agreement documenting the terms and conditions for the sale and purchase of goods between parties, incorporating federal and provincial legal requirements.

find out more

Standard Real Estate Sales Contract

A Canadian-compliant contract governing the sale and purchase of real property, outlining all terms, conditions, and obligations of the transaction.

find out more

Agreement To Sell A Car Privately

A Canadian legal agreement for the private sale of a motor vehicle between individuals, documenting sale terms and ownership transfer.

find out more

Builders Agreement Of Purchase And Sale

A Canadian legal agreement between builders and buyers for the sale and construction of new properties, incorporating provincial building codes and warranty requirements.

find out more

Contract Of Sale Of Residential Property

A legally binding agreement under Canadian law that documents the terms and conditions for the sale and purchase of residential property.

find out more

Boat Slip Purchase Agreement

A Canadian legal agreement for the purchase and transfer of ownership rights to a boat slip, incorporating federal marine and provincial property laws.

find out more

Hotel Purchase And Sale Agreement

A Canadian law-governed agreement for the purchase and sale of hotel properties, including real estate, business operations, and associated assets.

find out more

Standard Land Purchase And Sale Agreement

A legally binding Canadian agreement documenting the terms and conditions for the purchase and sale of real property, ensuring compliance with federal and provincial regulations.

find out more

Purchase And Resale Agreement

A Canadian-law governed agreement establishing terms for purchasing and reselling goods, including pricing, delivery, and territorial rights.

find out more

Contract For The Sale Of Used Car

A Canadian legal agreement for the sale and transfer of ownership of a used vehicle, complying with federal and provincial regulations while protecting both buyer and seller interests.

find out more

Real Estate Bill Of Sale Contract

A Canadian legal document that formalizes the sale and transfer of real property between parties, outlining all essential terms and conditions of the transaction.

find out more

As Is Where Is Sale Agreement

A Canadian law-governed agreement for the sale of property or assets on an 'as is, where is' basis, with no warranties and full risk transfer to the buyer.

find out more

Non Compete Asset Purchase Agreement

A Canadian-law governed agreement combining asset purchase terms with non-compete provisions, ensuring business asset transfer and protecting the buyer's interests through competitive restrictions.

find out more

Stock Sale Agreement Form

A Canadian legal document that formalizes the sale and transfer of shares between parties, ensuring compliance with federal and provincial regulations.

find out more

Sale Of Personal Goodwill Agreement

A Canadian law-governed agreement for the sale and transfer of an individual's professional goodwill, including reputation and business relationships, to a purchaser.

find out more

Agreement Of Purchase And Sale Form

A standardized Canadian legal document that formalizes the terms and conditions of a real estate property sale transaction between a buyer and seller.

find out more

Agreement Of Sale For A Residential Stand

A Canadian legal agreement for the sale and purchase of a residential stand, outlining terms, conditions, and obligations for property transfer.

find out more

As Is Property Sale Agreement

A Canadian legal agreement for the sale and purchase of property in its current condition ('as is'), without warranties or representations regarding its state.

find out more
See more related templates

Genie’s Security Promise

Genie is the safest place to draft. Here’s how we prioritise your privacy and security.

Your documents are private:

We do not train on your data; Genie’s AI improves independently

All data stored on Genie is private to your organisation

Your documents are protected:

Your documents are protected by ultra-secure 256-bit encryption

We are ISO27001 certified, so your data is secure

Organizational security:

You retain IP ownership of your documents and their information

You have full control over your data and who gets to see it

2 Docs LeftAccess Now