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A Stock Purchase Agreement spells out the terms and conditions when someone buys shares directly from a company or another shareholder. This binding contract, common in Canadian private companies and startups, covers the price per share, number of shares, and when the sale will close.

Beyond just listing the basic sale details, these agreements protect both buyers and sellers by including key warranties, representations about the company's condition, and any conditions that must be met before closing. Under Canadian securities laws, they also help ensure the transaction follows proper regulatory requirements, especially for private company share transfers.

A Stock Purchase Agreement becomes essential when you're buying or selling shares in a private Canadian company. This includes situations like investing in a startup, selling part of your business ownership, or transferring shares between shareholders during a company restructuring.

The agreement proves particularly valuable during complex transactions where specific conditions need to be met before closing. For example, when the sale depends on getting regulatory approvals, securing financing, or completing due diligence. It also helps protect both parties by clearly documenting important details like purchase price adjustments and seller warranties about the company's condition.

• Company Share Purchase Agreement: Standard version for buying shares directly from a corporation, includes basic terms and representations
• Stock Purchase Agreement Private Company: Tailored for private company transactions with additional confidentiality and transfer restrictions
• Share Purchase Agreement And Shareholders Agreement: Combines purchase terms with ongoing shareholder rights and obligations
• Stock Purchase Letter Of Intent: Preliminary agreement outlining key terms before final agreement
• Common Stock Purchase Agreement: Specifically for common share transactions with standard voting rights

• Selling Shareholders: Current owners of company shares who want to transfer their ownership, including founders, early investors, or departing executives
• Purchasing Investors: Individual or institutional buyers acquiring shares, from angel investors to private equity firms
• Corporate Legal Teams: In-house lawyers who review and customize Stock Purchase Agreements to protect company interests
• Securities Lawyers: External counsel who draft and negotiate agreement terms, ensuring compliance with Canadian securities laws
• Company Directors: Board members who must approve share transfers and often sign these agreements on behalf of the corporation

• Company Details: Gather current corporate records, share structure, and any existing shareholder agreements
• Transaction Basics: Document the agreed purchase price, number of shares, and payment terms
• Due Diligence: Review financial statements, corporate bylaws, and any restrictions on share transfers
• Buyer Information: Collect identification, proof of funds, and any required regulatory approvals
• Key Conditions: List any closing requirements, warranties, or representations needed
• Drafting Support: Use our platform to generate a customized Stock Purchase Agreement that includes all required elements under Canadian law

• Party Details: Full legal names and addresses of buyer, seller, and company issuing shares
• Share Information: Exact number, class, and price of shares being transferred
• Payment Terms: Purchase price, payment schedule, and any escrow arrangements
• Representations: Seller's warranties about share ownership and company condition
• Closing Conditions: Required approvals, documentation, and timing for completion
• Governing Law: Explicit statement that Canadian law governs the agreement
• Signature Block: Proper execution spaces with witness requirements under provincial laws

A Stock Purchase Agreement differs significantly from a Business Purchase Agreement. While both involve transferring ownership, they serve distinct purposes in Canadian business transactions.

• Asset Coverage: Stock Purchase Agreements deal exclusively with company shares, while Business Purchase Agreements cover entire business assets, including equipment, inventory, and goodwill
• Liability Transfer: Stock purchases automatically transfer all company liabilities to the new owner, whereas business asset purchases can exclude specific liabilities
• Tax Implications: Share sales typically result in capital gains tax for the seller, while business asset sales may involve various tax considerations including GST/HST
• Regulatory Requirements: Stock transfers must comply with securities laws and shareholder agreements, while business sales focus more on asset transfer regulations and third-party consents