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Sale Of Share Agreement Template for United States

A Sale of Share Agreement is a legally binding contract used in the United States that documents the transfer of ownership of shares from a seller to a buyer. This agreement outlines the terms and conditions of the share sale, including purchase price, payment terms, warranties, and representations. It complies with U.S. federal securities laws and state-specific regulations, providing protection for both parties and ensuring proper documentation of the transaction.

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What is a Sale Of Share Agreement?

The Sale of Share Agreement is essential when transferring ownership of shares in a U.S. company. This document is commonly used in various scenarios, from small private transactions to large corporate deals. It includes crucial elements such as share valuation, payment terms, warranties, and regulatory compliance requirements. The agreement must conform to both federal securities laws and state-specific regulations. A properly drafted Sale of Share Agreement helps minimize risks and potential disputes while ensuring a clear record of the transaction terms.

What sections should be included in a Sale Of Share Agreement?

1. Parties: Identifies all parties to the agreement, including full legal names and addresses

2. Background/Recitals: Sets out the context and purpose of the share sale

3. Definitions: Defines key terms used throughout the agreement

4. Sale and Purchase: Core transaction terms including number of shares, price, and payment terms

5. Completion: Details of when and how the transfer will take place

6. Seller's Warranties: Representations and warranties about the shares and company

7. Buyer's Warranties: Representations about buyer's capacity to purchase

8. Governing Law: Specifies applicable law and jurisdiction

What sections are optional to include in a Sale Of Share Agreement?

1. Pre-completion Conditions: Conditions that must be met before completion - used when certain conditions must be satisfied before the sale can complete

2. Non-compete Provisions: Restrictions on seller's future activities - used when protecting the company's business interests post-sale

3. Tax Indemnities: Specific tax-related protections - used when tax liabilities are a significant concern

4. Earn-out Provisions: Terms for additional future payments - used when part of purchase price is contingent on future performance

What schedules should be included in a Sale Of Share Agreement?

1. Schedule 1 - Share Details: Details of shares being transferred including share certificates

2. Schedule 2 - Warranties: Detailed list of warranties given by seller

3. Schedule 3 - Disclosure Letter: Exceptions to warranties

4. Schedule 4 - Company Information: Key company details, including financial statements

5. Schedule 5 - Transfer Forms: Share transfer forms and other required documentation

6. Schedule 6 - Board Resolutions: Copies of relevant board approvals

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

United States

Publisher

Ƶ

Cost

Free to use

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