Company Sale Contract for Malta

Company Sale Contract Template for Malta

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Company Sale Contract

"I need a Company Sale Contract for the sale of my small Maltese retail business (100% shares) to a local buyer, with completion planned for March 2025, including basic warranties and a 12-month non-compete clause."

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What is a Company Sale Contract?

The Company Sale Contract is a fundamental document used in corporate transactions under Maltese law for transferring ownership of a business entity. This agreement is essential when conducting company acquisitions in Malta, whether structured as a share sale or asset sale. The document must comply with the Maltese Companies Act (Chapter 386) and related legislation, while also considering EU regulations where applicable. It contains comprehensive provisions covering purchase price, warranties, indemnities, conditions precedent, completion mechanics, and post-completion obligations. The contract is particularly important in Malta's growing business environment, where international companies frequently establish presence through acquisitions. It requires careful attention to local regulatory requirements, tax implications, and specific industry regulations depending on the sector involved.

What sections should be included in a Company Sale Contract?

1. Parties: Identification of the seller(s) and buyer(s), including full legal names and registered addresses

2. Background: Context of the transaction, including brief company history and purpose of the sale

3. Definitions and Interpretation: Defined terms used throughout the agreement and rules of interpretation

4. Sale and Purchase: Core transaction terms including what is being sold (shares/assets) and the basic agreement to sell and purchase

5. Purchase Price: Consideration amount, payment terms, and any price adjustment mechanisms

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

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

8. Completion: Mechanics of completion, including timing, location, and actions required

9. Warranties: Seller's warranties regarding the company, its business, and assets

10. Limitations on Liability: Limitations on warranty claims and general liability caps

11. Tax Covenant: Specific indemnities relating to tax matters

12. Confidentiality and Announcements: Obligations regarding confidentiality and public statements about the transaction

13. Post-Completion Obligations: Ongoing obligations after completion, including transitional arrangements

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

What sections are optional to include in a Company Sale Contract?

1. Non-Compete Provisions: Restrictions on seller's future business activities - include when seller could compete with the business

2. Property Provisions: Specific provisions relating to company-owned real estate - include when company owns significant property assets

3. Intellectual Property Rights: Detailed IP provisions - include when IP is a significant company asset

4. Employee Matters: Specific provisions regarding employees - include when there are key employees or significant workforce issues

5. Environmental Matters: Environmental warranties and indemnities - include for companies with environmental risks

6. Earn-out Provisions: Structure for additional payments based on future performance - include when part of purchase price is contingent

7. Bank Financing: Provisions relating to third-party financing - include when purchase is partially bank-financed

8. Regulatory Approvals: Detailed provisions regarding required regulatory approvals - include for regulated businesses

9. Group Restructuring: Provisions for pre-sale restructuring - include when corporate restructuring is needed before sale

What schedules should be included in a Company Sale Contract?

1. Company Details: Full corporate information including shareholding structure and subsidiaries

2. Properties: Details of all owned and leased properties

3. Intellectual Property: List of all IP rights owned or licensed by the company

4. Material Contracts: Summary of key commercial contracts

5. Employee Information: Details of employees, including key terms and benefits

6. Warranties: Full warranty schedule

7. Tax Covenant: Detailed tax covenant provisions

8. Completion Obligations: Detailed list of completion deliverables

9. Bank Account Details: Payment account information for completion

10. Data Room Index: Index of due diligence materials provided

11. Disclosure Letter: Specific disclosures against 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

Relevant legal definitions
Clauses
Relevant Industries

Financial Services

Manufacturing

Retail

Technology

Real Estate

Professional Services

Healthcare

Hospitality

Construction

Energy

Telecommunications

Transport and Logistics

Media and Entertainment

Education

Relevant Teams

Legal

Finance

Corporate Development

Mergers & Acquisitions

Tax

Compliance

Risk Management

Board of Directors

Executive Leadership

Corporate Secretariat

Due Diligence

Treasury

Corporate Finance

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Corporate Lawyer

Legal Counsel

Company Secretary

Finance Director

Managing Director

Business Development Director

Mergers & Acquisitions Manager

Due Diligence Manager

Corporate Finance Manager

Tax Director

Risk Manager

Compliance Officer

Board Member

Investment Director

Transaction Manager

Industries
Companies Act (Chapter 386 of the Laws of Malta): Primary legislation governing company formation, operation, and transfer in Malta, including requirements for share transfers, company registration, and corporate governance
Civil Code (Chapter 16 of the Laws of Malta): Provides the fundamental principles of contract law, including formation, validity, and enforcement of contracts in Malta
Income Tax Act (Chapter 123 of the Laws of Malta): Governs taxation aspects of company transfers, including capital gains tax implications and stamp duty requirements
Competition Act (Chapter 379 of the Laws of Malta): Regulates merger control and competition aspects of company acquisitions, particularly relevant for larger transactions
Employment and Industrial Relations Act (Chapter 452): Protects employee rights during company transfers, including provisions for transfer of employment contracts
Data Protection Act (Chapter 586): Regulates the handling of personal and sensitive data during company due diligence and transfer processes
Prevention of Money Laundering Act (Chapter 373): Imposes obligations for due diligence and verification of parties involved in company transactions
Value Added Tax Act (Chapter 406): Governs VAT implications in company transfers and treatment of company assets
Malta Financial Services Authority Act (Chapter 330): Relevant if the company operates in financial services sector, requiring specific approvals and compliance
Duty on Documents and Transfers Act (Chapter 364): Regulates stamp duty and other documentary taxes applicable to company transfer documents
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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