Business Acquisition Agreement - No Guarantor

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Description:

A business acquisition agreement between a Buyer and a Seller with no parental guarantee. The Seller's warranties are included in another template. This agreement is drafted in favour of the Buyer.

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.

Pending Completion, the Seller shall:

(a) cause the Business to be conducted only in the ordinary and usual course and shall not make (or agree to make) any payment other than routine payments in the ordinary and usual course of trading;

(b) take all reasonable steps to preserve and protect the Business Assets;

(c) allow the Buyer's representatives, upon reasonable notice and during normal business hours, access to the books and records of each Group Company (including, without limitation, all statutory books, minute books, leases, contracts, supplier lists and customer lists) together with the right to take copies;

(d) not do, allow or procure any act or omission which would constitute a breach of any of the Warranties if they were given on or at any time before Completion by reference to the facts and circumstances then existing;

(e) make prompt disclosure to the Buyer of all relevant information which comes to the notice of the Seller in relation to any fact or matter (whether existing on or before the date of this Agreement or arising afterwards) which may constitute a breach of any of the Warranties if they were to be repeated on or at any time before Completion by reference to the facts and circumstances then existing;

(f) ensure that no dividend or other distribution is declared, paid or made the Seller out of the profits of the Business;

(g) cause all transactions between the Business and other members of the Seller's Group (including other divisions of the Seller) to take place on arm's length terms;

(h) ensure that no change is made in terms of employment, including pension fund commitments, by the Seller (other than those required by law) which could increase the total staff costs of the Business by more than 10% per annum;

(i) ensure that the amount of any Intra-Group Indebtedness owed by the Seller as at the date of this Agreement in relation to the Business shall not be increased;

(j) no action is taken by any member of the Seller Group which is inconsistent with the provisions of this Agreement or the consummation of the transactions contemplated by this Agreement.

4.2 Pending Completion, the Seller shall consult fully with the Buyer in relation to any matters which may have a material effect upon the Business and, without the prior consent of the Buyer, the Seller shall not in relation to the Business:

(a) enter into any contract or commitment (or make a bid or offer which may lead to a contract or commitment) having a value or involving expenditure in excess of 10% of the Book Value of the Busienss or which is of a long term or unusual nature or which could involve an obligation of a material nature or which may result in any material change in the nature or scope of the Business;

(b) agree to any variation of any existing contract which may have a material effect upon the nature or scope of the Business;

(c) (whether in the ordinary and usual course of business or otherwise) acquire or dispose of, or agree to acquire or dispose of, any asset having a value in excess of 5% of the Net Tangible Assets of the Company; or

(d) enter into any agreement, contract, arrangement or transaction (whether or not legally binding) other than in the ordinary and usual course of business.

Document Type:

Agreements / contracts

Category:

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

 
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