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Overview — Share sale agreements
Updated by Karen Lee, Principal, Legal Know-How
Matthew Hall, Solicitor director, artifex advisors
Introduction
The two main ways of transferring a business are:
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to sell all of the assets which comprise the business, including assigning all relevant contracts; or
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to sell the shares in the company which owns the business. Once the buyer owns the shares in the company, this gives control over all the assets which comprise the business.
General drafting notes
Various matters must be given consideration when drafting (and reviewing) a share sale agreement depending on whether you are acting for the vendor or purchaser. Generally speaking, drafting (and reviewing) include the details of the shares (such as the purchase price, the amount of any deposit, and the exchange and completion dates), the rights and the obligations of the vendor and the purchaser, and matters relating to confidentiality, warranties, indemnity, risks and liability.
Care must also be taken to ensure consideration is given to, where relevant, the Personal Property Securities Act 2009 (Cth) (PPSA) and other legislation.
See General drafting notes.
Share sale agreements
This guidance note provides a Share Sale Agreement precedent, and guidance on adapting this precedent for different situations.
See Share sale agreements.
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