Unit Purchase Agreement for the United Kingdom

Unit Purchase Agreement Template for England and Wales

A Unit Purchase Agreement is a legally binding contract governed by English and Welsh law that documents the sale and purchase of units in a company or partnership. The agreement sets out the terms and conditions of the transaction, including purchase price, warranties, representations, and conditions precedent. It provides legal protection for both buyer and seller while ensuring compliance with UK company law and financial regulations.

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What is a Unit Purchase Agreement?

The Unit Purchase Agreement is a fundamental document in corporate transactions under English and Welsh law, used when transferring ownership of units in a company or partnership. This agreement is essential for both private and public transactions, providing a comprehensive framework for the sale process, including price mechanisms, warranties, and regulatory compliance requirements. The document typically includes detailed provisions about the units being transferred, conditions precedent, completion mechanics, and post-completion obligations. It's particularly important in ensuring that the transaction complies with UK company law and financial regulations while protecting both parties' interests.

What sections should be included in a Unit Purchase Agreement?

1. Parties: Identification of buyer, seller, and any guarantors

2. Background: Context of the transaction and brief company description

3. Definitions: Key terms used throughout the agreement

4. Sale and Purchase: Core transaction terms including price and units being transferred

5. Completion: Timing and mechanics of closing

6. Warranties: Seller's representations about the business and units

7. Limitations on Liability: Caps and restrictions on warranty claims

8. Confidentiality: Protection of sensitive information

9. Governing Law: Jurisdiction and dispute resolution

What sections are optional to include in a Unit Purchase Agreement?

1. Pre-completion Conditions: Used when completion is conditional on specific events such as regulatory approval or third-party consents

2. Tax Covenant: Specific tax-related warranties and indemnities for transactions with significant tax implications

3. Non-compete Provisions: Restrictions on seller's future activities to protect business value post-sale

What schedules should be included in a Unit Purchase Agreement?

1. Schedule 1 - Completion Requirements: Detailed list of documents and actions required at completion

2. Schedule 2 - Warranties: Detailed warranties about the business and units

3. Schedule 3 - Company Information: Corporate details, financial statements, material contracts

4. Schedule 4 - Properties: Details of company real estate (if applicable)

5. Schedule 5 - Intellectual Property: List of IP rights and registrations

6. Schedule 6 - Employee Information: Key employment terms and arrangements

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

England and Wales

Publisher

Genie AI

Document Type

Purchase Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Industries

Companies Act 2006: Primary legislation governing company operations, including share capital, transfer provisions, directors' duties, corporate authority, and registration requirements

Financial Services and Markets Act 2000: Regulatory framework for financial instruments and regulated activities, relevant if units/shares fall under financial instruments category

Common Law Contract Principles: Fundamental principles including offer, acceptance, consideration, intention to create legal relations, and capacity to contract

Law of Property (Miscellaneous Provisions) Act 1989: Legislation specifying requirements for contracts to be in writing and formally executed

Stamp Duty Legislation: Tax regulations concerning Stamp Duty and Stamp Duty Reserve Tax applicable to share transfers

Capital Gains Tax Provisions: Tax legislation governing capital gains on disposal of shares or units

Corporation Tax Act 2010: Tax framework affecting corporate transactions and business transfers

Money Laundering Regulations 2017: Anti-money laundering requirements for business and share transactions

UK Takeover Code: Regulations governing corporate acquisitions and takeovers, if applicable to the transaction size

Competition Act 1998: Legislative framework ensuring fair competition, relevant for larger transactions

Data Protection Act 2018/UK GDPR: Requirements for handling personal data during due diligence and transaction processes

Corporate Constitutional Documents: Internal company documents including Articles of Association and Shareholders' Agreements that may affect unit transfers

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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