Share Purchase Agreement Nz

Since the buyer is effectively on the back of the business, the buyer can inherit large liabilities and hidden obligations. As a result, prior to the proceeds of the sale, a thorough (and potentially more expensive) “due diligence” process will be required, as well as a robust agreement on the sale and purchase of shares. A purchase and sale contract becomes unconditional if all the conditions are met. The two had a good relationship, so the friend did not have much diligence or investigation in the business. They also did not seek legal advice on the transaction and prepared an agreement on the transfer of shares themselves. A share sale is an agreement between the shareholders of the company to sell their shares in the company to the buyer. In this case, you consider your business as a box and you sell the entire box to the buyer (which inevitably comes with all the assets in it), as they are and continue to be the property of the business you are selling. Here, the purchaser becomes the new owner of the company itself and thus acquires all the rights and assets of the company, but also all the obligations and commitments of the company, whether current or historical, known or unknown. If you add a Sunset clause to the purchase and sale agreement, you can be sure that your offer has been accepted or declined until that time and date, which will allow you to offer real estate.

If you bid for another property while waiting to hear about your first offer, you may find yourself in a situation where both offers are accepted and you have committed to buying two properties. As noted above, one of the main drawbacks of a stock acquisition for a buyer is uncertainty about the purchaser`s obligations and commitments (including current and historical tax obligations). There is no universal sales contract – there are several agreements that are used by different agencies with different clauses and conditions that buyers and sellers should know about.