Company Acquisition Agreement - with No Guarantor

The Company Acquisition Agreement - with No Guarantor is a legal document that outlines the terms and conditions of the acquisition of a company. The agreement is entered into between the sellers, who are the current owners of the company, and the buyer, who wishes to purchase the company. The importance of this document lies in its ability to provide a clear and legally binding agreement between the parties involved in the acquisition.

 

The entire document is divided into several sections, each addressing a specific aspect of the acquisition. The first section, titled 'Interpretation', defines the key terms used throughout the agreement and provides clarity on their meanings. This ensures that both parties have a clear understanding of the terms used in the agreement.

 

The second section, titled 'Sale of the Shares and Price', outlines the details of the sale and purchase of the shares of the company. It specifies the number of shares to be sold by each seller and the agreed price to be paid by the buyer. The section also includes provisions for the payment of the price, whether in cash or shares, and any additional amounts that may be payable in certain circumstances.

 

The third section, titled 'Conditions to Completion', sets out the conditions that must be fulfilled before the sale and purchase of the shares can be completed. These conditions include the passing of a resolution by the shareholders of the sellers approving the transaction, the delivery of written consents from certain persons, and the repayment of any outstanding intra-group indebtedness.

 

The fourth section, titled 'Pre-Completion Undertakings', outlines the obligations of the sellers prior to completion. These obligations include conducting the business in the ordinary course, preserving and protecting the business assets, allowing the buyer's representatives access to the books and records of the company, and making prompt disclosure of any relevant information.

 

The fifth section, titled 'Completion', sets out the process for completing the sale and purchase of the shares. It specifies the documents and certificates that must be delivered by the sellers to the buyer, such as share transfers, share certificates, and statutory books. It also provides for the payment of the price and the allocation of consideration shares, if applicable.

 

The sixth section, titled 'Completion Accounts', outlines the requirements for preparing completion accounts. These accounts are prepared after completion and reflect the financial position of the company and its subsidiaries at that time. The section specifies the accounting policies and procedures to be followed in preparing the accounts and provides for the resolution of any disputes regarding the accounts.

 

The seventh section, titled 'Post-Completion Undertakings', sets out the sellers' obligations following completion. These obligations include the repayment of connected trading indebtedness, the release of any connected guarantees, the change of the sellers' group company name, and the cessation of certain activities by the sellers and their connected persons.

 

The eighth section, titled 'Restrictions on the Sellers', imposes restrictions on the sellers for a specified period after completion. These restrictions prohibit the sellers and their connected persons from engaging in competing businesses or soliciting employees of the group companies.

 

The ninth section, titled 'Warranties', contains the sellers' representations and warranties regarding the company and its business. These warranties provide assurances to the buyer regarding the accuracy and completeness of the information provided by the sellers and the condition of the company and its assets.

 

The tenth section, titled 'Limitations on Claims', sets out the limitations on the buyer's claims for breach of warranty. It specifies the procedures for making a claim and the maximum liability of the sellers under the warranties.

 

The eleventh section, titled 'Buyer's Rights to Terminate', grants the buyer the right to terminate the agreement in certain circumstances, such as a breach of the agreement by the sellers or a material adverse change in the business or financial position of the group.

 

The twelfth section, titled 'Withholding Tax and Grossing Up', addresses the payment of taxes and the grossing up of payments to account for any deductions or withholdings required by law.

 

The thirteenth section, titled 'Entire Agreement', confirms that the agreement and the disclosure letter constitute the entire agreement between the parties and supersede any prior agreements or understandings.

 

The fourteenth section, titled 'Variation', states that any variation of the agreement must be in writing and signed by all parties.

 

The fifteenth section, titled 'Assignment', allows for the assignment of rights and obligations under the agreement by the buyer and provides for the notification of any such assignment.

 

The sixteenth section, titled 'Announcements', restricts the parties from making any announcements or disclosures regarding the agreement without the prior written approval of the other party.

 

The seventeenth section, titled 'Costs', specifies that each party is responsible for its own costs incurred in connection with the agreement, except for certain specified costs to be borne by the buyer.

 

The eighteenth section, titled 'Severability', provides that if any provision of the agreement is held to be invalid or unenforceable, it shall be deemed not to be included in the agreement, but the remaining provisions shall remain in full force and effect.

 

The nineteenth section, titled 'Counterparts', allows the agreement to be executed in multiple counterparts, with each counterpart being deemed an original.

 

The twentieth section, titled 'Further Assurance', requires the parties to perform any further acts or execute any further documents necessary to implement and give effect to the agreement.

 

The twenty-first section, titled 'Waivers/Buyer's Rights and Remedies', clarifies that no failure or delay by the buyer in exercising any right or remedy under the agreement shall operate as a waiver of that right or remedy.

 

The twenty-second section, titled 'No Rights of Third Parties', states that only the parties to the agreement have the right to enforce its terms.

 

The twenty-third section, titled 'Governing Law, Jurisdiction', specifies the governing law and jurisdiction for any disputes arising under the agreement.

 

The twenty-fourth section, titled 'Notices and Service', sets out the requirements for giving notice under the agreement, including the methods of service and the addresses for service.

 

The agreement also includes several schedules that provide additional details and information, such as the details of the company and its subsidiaries, the maximum liability under the warranties, the pension scheme of the company, the completion accounts, the articles of association (if applicable), and the warranties themselves.

 

Overall, the Company Acquisition Agreement - with No Guarantor is a comprehensive and detailed document that covers all aspects of the acquisition process and provides a clear framework for the sale and purchase of the shares of the company.

How to use this document?

1. Review the entire document to understand the terms and conditions of the acquisition agreement.

2. Familiarize yourself with the interpretation section to understand the key terms used throughout the agreement.

3. Pay close attention to the sale of the shares and price section to understand the details of the sale and purchase, including the agreed price and payment terms.

4. Review the conditions to completion section to ensure that all necessary conditions are fulfilled before completing the sale and purchase.

5. Understand the pre-completion undertakings and ensure that the sellers comply with their obligations prior to completion.

6. Follow the specified process for completion, including the delivery of necessary documents and the payment of the price.

7. If applicable, prepare the completion accounts in accordance with the specified accounting policies and procedures.

8. Familiarize yourself with the post-completion undertakings and ensure that the sellers fulfill their obligations following completion.

9. Adhere to the restrictions on the sellers, including the prohibition on engaging in competing businesses or soliciting employees.

10. Review the warranties provided by the sellers and ensure that they are accurate and complete.

11. Understand the limitations on claims and follow the specified procedures for making a claim.

12. Be aware of the buyer's rights to terminate the agreement in certain circumstances.

13. Consider any withholding tax obligations and ensure that payments are grossed up if required.

14. Understand that the agreement and the disclosure letter constitute the entire agreement between the parties.

15. Seek legal advice if necessary to fully understand the rights and obligations under the agreement.

16. Keep in mind that any variation of the agreement must be in writing and signed by all parties.

17. Be mindful of any announcements or disclosures regarding the agreement and obtain prior written approval if necessary.

18. Keep track of costs incurred in connection with the agreement and ensure that each party is responsible for its own costs.

19. Be aware of the governing law and jurisdiction for any disputes arising under the agreement.

20. Follow the specified requirements for giving notice under the agreement, including the methods of service and the addresses for service.

21. Refer to the schedules for additional details and information, such as the details of the company and its subsidiaries, the maximum liability under the warranties, the pension scheme of the company, the completion accounts, the articles of association (if applicable), and the warranties themselves.

22. Seek legal advice or consult with professionals experienced in company acquisitions for guidance specific to your situation.