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Share Purchase Agreement
256 People purchased
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SHARE PURCHASE AGREEMENT
As the name suggests, a Share Purchase Agreement (SPA) is an agreement that is entered into between an existing shareholder and a new investor who invests in the company by purchasing the shares from an existing shareholder, and thereby providing a partial or full exit to the existing shareholder.
An SPA contains the terms of the purchase, i.e. the price at which the shares have been purchased, the number of shares purchased, etc.
Contents of Share Purchase Agreement
The following clauses form part of a well drafted SPA:-
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Type of security purchased
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Consideration
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Condition Precedents
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Condition Subsequents
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Closing date and actions
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Representation and Warranties
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Indemnity
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Cost
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Confidentiality
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Termination
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Governing law and Dispute Resolution
Laws governing the Share Purchase Agreement in India
The different laws which govern various aspects of Share Purchase Agreement in India are as follows:
- Companies Act, 2013 and various rules framed thereunder
- The Indian Contract Act, 1872
- Foreign Exchange Management Act, 1999
- Consolidated FDI Policy, 2020
- RBI Policies
- Competition Act, 2002
- SEBI Guidelines (in case of listed company)
- Stamp Duty Act (state specific)
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Deliverables
Our standard deliverables for every document drafting includes:
- 30 Minutes of Talk-Time with the Lawyer for drafting/reviewing the Agreement
- First draft of the documents will be delivered to you within a maximum of 2 working days
- Post-delivery of the first draft – 2 Iterations per Document to incorporate your suggestions/changes
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Share Purchase Agreement
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Frequently Asked Question
What is the importance of Share Purchase Agreement?
A Share Purchase Agreement contains the terms of the purchase, i.e. the price at which the shares have been purchased, the number of shares purchased, representation and warranties, actions before closing date, and post closing date, term and termination, etc.
How do you use Share Purchase Agreement?
If you are an investor in a company and you want to exit, either partially or wholly by selling your shares to another person, then a Share Purchase Agreement (SPA) is required to be executed between you and the new investor
In case, you want to buy shares in a company from an existing shareholder, then you would require to enter into an SPA with him/her. Besides other things, an SPA, lists out the important representations and warranties from the seller side, which are important from an investor perspective.
What is the difference between Shareholders Agreement, Share Subscription Agreement and Share Purchase Agreement?
A Shareholder's Agreement (SHA) is an agreement that governs the relationship between the shareholders inter se. It enumerated the important rights and obligations of the shareholders.
A Share Subscription Agreement (SSA) is an agreement between a new investor and the company by which the company issues fresh securities to the investor.
A Share Purchase Agreement (SPA) is an agreement that is entered into between a new investor and an existing (or exiting) investor. By the virtue of SPA, the existing investor transfers the whole or a part of its shareholding in favour of the new investor.
In contrast therefore, in an SSA, new securities are being issued to the investor and in case of SPA, an existing investor is transferring his shareholdings to the new investor. The company is just a passive party in case of SPA. However, in SSA, the company is the active party. A SHA, on the other hand, is entered into either case, i.e. whether new security is being issued or the security is being transferred.
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Startup Documents
Share Purchase Agreement
₹5999
₹ 11999 (50% Off) ₹6000 SaveGross Total