Business Acquisition Agreement - with Seller's Guarantor

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Description:

A business acquisition agreement between a Buyer and a Seller with the Seller's parent guaranteeing the obligations. The Seller's warranties are included in another template. This agreement is drafted in Neutral Form.

The Seller has agreed to sell the Business (as defined below) to the Buyer for the consideration and upon the terms set out in this Agreement.

The Seller has made representations to the Buyer in the terms of the undertakings and warranties set out in Schedule 3 with the intention that the Buyer should rely upon such representations in entering into this Agreement.

The Guarantor has agreed, in consideration of the Buyer entering into this Agreement, to guarantee the performance by the Seller of its obligations hereunder upon the terms set out in clause 19 of this Agreement.

The Seller shall sell and the Buyer shall purchase, as a going concern and with effect from the close of business on the Transfer Date, the whole of the property, undertaking and assets constituting the Business including the following Business Assets, on the terms that the same covenants shall be deemed to be given by the Seller on Completion in relation to the Business Assets:

(a) the Properties;

(b) the Plant and Equipment;

(c) the working capital, raw materials, stocks, work-in-progress and finished goods of the Business;

(d) the Trade Debtors (subject to the assumption by the Buyer of the Trade Creditors);

(e) the Business IPR;

(f) the benefit (subject to the burden) of all Contracts;

(g) the benefit of all Business Claims;

(h) the shares of the Seller in the Trade Investments (together with all rights attaching to them including any dividend or other distribution declared or paid on or after [COMPLETION]); and

(i) the Goodwill.

2.2 In consideration for the sale and transfer by the Seller of the Business, the Buyer shall:

(a) pay to the Seller the sum of [AMOUNT];

(a) pay to the Seller the aggregate of (i) the sum of [AMOUNT] for the Goodwill, the Business IPR and the benefit and burden of the Contracts and (ii) an amount equal to the book value of the Net Tangible Assets at the close of business on the Transfer Date as determined under clause 8 pursuant to the Completion Accounts;

(b) assume responsibility for the satisfaction of all the Liabilities (excluding any liabilities for which the Seller is expressly to remain liable under this Agreement and the Buyer shall indemnify the Seller against all proceedings, claims and demands in respect of such Liabilities;

(c) issue to the Seller, credited as fully paid, [SHARES] Ordinary Shares in the capital of the Buyer.

The cash purchase price payable by the Buyer to the Seller pursuant to clause 2.2(a) shall be paid as follows:

(a) [AMOUNT] shall be paid in cash on Completion; and

(b) the balance thereof (or the amount of any overpayment due from the Seller to the Buyer) shall be paid within seven (7) days of the final determination under clause 8 of the book value of the Net Tangible Assets pursuant to the Completion Accounts together with interest on such balance (or overpayment) from the date of Completion to the date of payment at a rate per annum equal to 5 per cent. above the base rate of [COUNTRY] from time to time.

The Seller shall grant to the Buyer and the Buyer shall accept the Lease in respect of the Properties. The provisions of Schedule 5 shall apply in respect of the grant of the Lease.

The provisions of clause 10 shall apply in respect of Intellectual Property Rights.

Completion of the sale and purchase of the Business shall be conditional upon the following conditions having been fulfilled:

(a) the passing of a resolution by the shareholders of the Seller approving the transactions contemplated by this Agreement;

(a) the passing of a resolution by the shareholders of the Buyer approving the transactions contemplated by this Agreement;

(b) the delivery to the Buyer of written consents from the following persons to the effect that they consent to the sale and purchase of the Business and agree not to exercise any right (whether of termination or otherwise) arising by reason of such sale and purchase:

Document Type:

Agreements / contracts

Category:

Business > Debt / Equity Investment and Capital Raising > Mergers and Acquisitions / Completion Certificate

 
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