Here, company refers to the party selling the shares. Issues to be considered when drawing up a share purchase agreement include:
- Details of the company and its tax status
- Shareholder contributions and ownership
- Description of the company’s business
- Territorial limitations for the company
- Minimum performance requirements
- Transactions between shareholders and the company
- Funding and shareholder advances
- Company headquarters and management
- Financial and management reporting
- Board of Directors
- Shareholder meetings
- Actions requiring shareholder approval
- Procedure for transfer and sale of shares
- Conflicts of interest
- Distribution of profits
- Audit and inspection
- Confidential information
- Intellectual property
- Term of agreements
A share purchase agreement will have a number of exhibits attached to it, including the most recent balance sheet, profit and loss statement, cash flow analysis, marketing plan and budget for the next financial period.
