Share Purchase Agreement

Free Share Purchase Agreement Template

Use this free template as a starting point for a straightforward sale and purchase of shares in a private limited company. Real-world share sales (especially M&A transactions) typically require materially more depth (warranties, indemnities, tax covenant, disclosure letter). This template covers the core mechanics for simpler transfers and small-company sales. Copy and customise it to suit the transaction.

SHARE PURCHASE AGREEMENT

Date: [Date]

Parties:

(1) Seller: [Full name], of [Address] (the "Seller")

(2) Buyer: [Full name], of [Address] (the "Buyer")

[Add other Sellers or Buyers as needed]

(3) Company: [Full company name], a company incorporated in [Jurisdiction] with company number [Number] and registered office at [Address] (the "Company")

Background

A. The Company has an issued share capital of [Number] shares, of which the Seller is the registered legal and beneficial owner of [Number] [Class] shares of [Nominal value] each (the "Sale Shares").

B. The Seller has agreed to sell, and the Buyer has agreed to purchase, the Sale Shares on the terms of this Agreement.

1. Sale and Purchase

The Seller shall sell with full title guarantee, and the Buyer shall purchase, the Sale Shares free from all encumbrances and with all rights attached or accruing to them at Completion, including the right to receive all dividends and distributions declared, paid, or made after the date of this Agreement.

2. Consideration

• Purchase Price: [Currency and amount] (the "Purchase Price")
• Payment: [in cash on Completion / [Y]% in cash on Completion, [Y]% as deferred consideration payable [in instalments / on milestone events] as set out in Schedule [1]]
• Method: bank transfer to the Seller's nominated account (details supplied separately)

3. Completion

Completion shall take place on [Completion date] at [Location, or via electronic exchange] (or such other date and place as the Parties agree in writing).

At Completion the Seller shall deliver to the Buyer:

• A signed stock transfer form in respect of the Sale Shares
• The share certificate(s) for the Sale Shares (or an indemnity for any lost certificate)
• Any waiver of pre-emption rights from other shareholders required by the Company's articles of association or any shareholders' agreement
• A signed resignation letter from the Seller (if a director, officer, or employee), confirming no claim for compensation save as agreed
• Board minutes of the Company approving the transfer, registering the Buyer as a member, issuing new share certificates, and (where applicable) appointing the Buyer's nominees to the board
• The statutory books of the Company up to date

At Completion the Buyer shall:

• Pay the Purchase Price (or first instalment) in accordance with clause 2
• Take such other actions as set out in Schedule [2]

4. Seller's Warranties

The Seller warrants to the Buyer that, at the date of this Agreement and at Completion:

(a) The Seller has full power and authority to enter into this Agreement and to transfer the Sale Shares;

(b) The Seller is the sole legal and beneficial owner of the Sale Shares, and the Sale Shares are fully paid and free from all encumbrances;

(c) Entry into this Agreement does not breach any other contract, court order, or applicable law;

(d) The Sale Shares represent [X]% of the issued share capital of the Company at Completion;

(e) The Company has not, since [Date of last accounts], (i) declared or paid any dividend or other distribution, (ii) issued or agreed to issue any further shares, options, or instruments convertible into shares, (iii) entered into any material contract outside the ordinary course of business, (iv) commenced or settled any material litigation, or (v) made any material change to its business save as disclosed in writing to the Buyer; and

(f) The information disclosed by the Seller to the Buyer about the Company in the disclosure letter / information pack dated [Date] is true and accurate in all material respects.

5. Buyer's Warranties

The Buyer warrants that:

(a) The Buyer has full power and authority to enter into this Agreement and to acquire the Sale Shares;

(b) The Buyer has the financial resources to pay the Purchase Price (and any deferred consideration); and

(c) Entry into this Agreement does not breach any other contract, court order, or applicable law.

6. Limitations on Claims

• Any claim by the Buyer for breach of warranty must be notified in writing to the Seller within [12 / 18] months of Completion (or [7] years for any tax warranty), giving reasonable detail of the claim.
• No claim is payable unless the aggregate of all claims exceeds [Currency and amount] (the "Threshold"), in which case the full amount of the claims is payable.
• The Seller's total aggregate liability for all claims is capped at the Purchase Price.
• The Buyer must use reasonable steps to mitigate any loss giving rise to a claim.

7. Restrictive Covenants

For [12] months after Completion, the Seller shall not:

• Engage in any business that competes directly with the Company within [geographical area]
• Solicit customers of the Company with whom the Seller had material dealings in the [12] months before Completion
• Solicit or employ any employee of the Company active at Completion

These restrictions apply only to the extent reasonable and enforceable under applicable law.

8. Confidentiality

Each Party shall keep confidential all non-public information learned about the other Party and the Company in connection with this Agreement, except for disclosure permitted to professional advisors, as required by law, or with prior written consent.

9. Tax

• The Seller is responsible for any tax liability arising from the sale of the Sale Shares (capital gains tax or equivalent).
• The Buyer is responsible for any stamp duty / stamp duty reserve tax payable on the transfer.

10. Further Assurance

Each Party shall execute such further documents and take such further actions as are reasonably necessary to give effect to this Agreement and to perfect the Buyer's title to the Sale Shares (including signing additional stock transfer forms, attending Companies House filings, and notifying counterparties of the change in ownership as required).

11. Entire Agreement

This Agreement, together with the disclosure letter and the schedules, constitutes the entire agreement between the Parties in relation to the sale of the Sale Shares and supersedes all prior negotiations, correspondence, and understandings.

12. Governing Law and Disputes

This Agreement is governed by the laws of [Jurisdiction] and the Parties submit to the exclusive jurisdiction of the courts of [Jurisdiction].

Signatures:

The Seller:

_ Date: _ [Name]

The Buyer:

_ Date: _ [Name]

The Company (acknowledging and consenting to the transfer):

_ Date: _ [Name], Director

This is a basic template provided for informational purposes. For a professionally generated and legally tailored document, use Bind's contract automation platform.