Share Purchase Agreement

This Agreement is made on   200
between:
(1) [ ] a company incorporated in [ ] whose registered office is at
[ ] (the “Seller”); and
(2) [ ] a company incorporated in [ ] whose registered office is at
[ ] (the “Purchaser”).
Whereas:
(A) The Seller has agreed to sell the Shares (as defined below) and to assume the
obligations imposed on the Seller under this Agreement;
(B) The Purchaser has agreed to purchase the Shares and to assume the obligations
imposed on the Purchaser under this Agreement;
(C) [Insert other recitals as appropriate].
It is agreed as follows:
1 Interpretation
In this Agreement, unless the context otherwise requires, the provisions in this Clause
1 apply:
1.1 Definitions
“Accounts” means the audited consolidated accounts of the Group [and the [audited]
accounts of the Group Companies] for the twelve month period ended on the Accounts
Date;
“Accounts Date” means [ ];
“Agreed Terms” means, in relation to a document, such document in the terms agreed
between the Seller and the Purchaser and signed for identification by the Purchaser[‟s
Lawyers] and the Seller[‟s Lawyers] [with such alterations as may be agreed in writing
between the Seller and the Purchaser from time to time];
“Business Day” means a day which is not a Saturday, a Sunday or a public holiday in
England;
“Closing” means the completion of the sale of the Shares pursuant to Clauses 6.1, 6.2
and 6.3 of this Agreement;
“Closing Amount” has the meaning given in Clause 3.1.1;
“Closing Date” means the date on which Closing takes place;
“Company” means ● Limited, details of which are set out in Schedule 1;
“Confidentiality Agreement” means the confidentiality agreement dated ● ● 200●
between [ ] and [ ] pursuant to which the Seller made available to
the Purchaser certain confidential information relating to the Group;
“Consultancy Agreement” means an agreement other than a contract of employment
with a Group Company, pursuant to which an individual provides services in relation
to the business of any Group Company;
“Consultant” means an individual providing services to a Group Company pursuant to
a Consultancy Agreement on an annual fee (on the basis of a full time consultancy) in
excess of [ ] or local equivalent;
[“Data Room” means the data room containing documents and information relating to
the Group made available by the Seller at [ ], the contents of which are listed
in [Appendix  to the Disclosure Letter];]
“Disclosure Letter” means the letter dated on the same date as this Agreement from
the Seller[‟s Lawyers] to the Purchaser[‟s Lawyers] disclosing:
(i) information constituting exceptions to the Seller‟s Warranties; and
(ii) details of other matters referred to in this Agreement;
“Draft Net Asset Statement” has the meaning given to it in Clause 8.1;
“Encumbrance” means any claim, charge, mortgage, lien, option, equity, power of
sale, hypothecation, retention of title, right of pre-emption, right of first refusal or other
third party right or security interest of any kind or an agreement, arrangement or
obligation to create any of the foregoing;
“Environment” and “Environmental Law” have the meanings given to them in
paragraph 9.1 of Schedule 7;
[“Environment Indemnity” means the indemnity relating to the Environment in the
Agreed Terms;]
“Estimated Net Assets” means ●;
“Group” means the Group Companies, taken as a whole;
“Group Companies” means the Company and the Subsidiaries and “Group
Company” means any one of them;
“Group Insurance Policies” means all insurance policies held exclusively for the
benefit of the Group Companies and “Group Insurance Policy” means any one of
them;
“Hazardous Substances” has the meaning given to it in paragraph 9.1 of Schedule 7;
“HMRC” means Her Majesty‟s Revenue and Customs;
“ICTA 1988” means Income and Corporation Taxes Act 1988;
“Intellectual Property” means trade marks, service marks, trade names, domain
names, logos, get-up, patents, inventions, registered and unregistered design rights,
copyrights, semi-conductor topography rights, database rights and all other similar
rights in any part of the world (including Know-how) including, where such rights are
obtained or enhanced by registration, any registration of such rights and applications
and rights to apply for such registrations;
“Know-how” means confidential [and proprietary] industrial and commercial
information and techniques in any form including (without limitation) drawings,
formulae, test results, reports, project reports and testing procedures, instruction and
training manuals, tables of operating conditions, market forecasts, lists and particulars
of customers and suppliers;
“Losses” means all losses, liabilities, costs (including without limitation legal costs
and experts‟ and consultants‟ fees), charges, expenses, actions, proceedings, claims and
demands;
“Management Accounts” means the unaudited management accounts relating to each
Group Company and to the Group drawn up to [Date] (the “Relevant Management
Accounts Date”);
“Net Asset Adjustment” means the amount by which the Net Assets exceed the
Estimated Net Assets, payable pursuant to Clause 8.3.1(ii) (such amount being
expressed as a positive figure) or the amount by which the Net Assets are less than the
Estimated Net Assets, payable pursuant to Clause 8.3.1(i) (such amount being
expressed as a negative figure);
“Net Assets” means the amount of the net assets of the Group as set out in the Net
Asset Statement;
“Net Asset Statement” means the statement to be prepared by the Purchaser in
accordance with Clause 8 and Schedule 6;
[“Official List” means the official list maintained by the UK Listing Authority;]
“Properties” means the properties set out in Parts 1 and 2 of Schedule 2 and
“Property” means any one of them;
“Purchaser’s Group” means the Purchaser and its [subsidiaries] [subsidiary
undertakings] from time to time;
“Purchaser’s Lawyers” means Linklaters LLP of One Silk Street, London EC2Y
8HQ;
“Purchaser’s Relief” shall have the meaning given in the Tax Indemnity;
“Relevant Employees” means those employees of the Group Companies who are
immediately prior to Closing employed in the Group [(other than any specifically
excluded by agreement with the Purchaser)] and “Relevant Employee” means any one
of them;
“Relief” shall have the meaning given in the Tax Indemnity;
“Reporting Accountants” means [ ] [or, if that firm is unable or unwilling
to act in any matter referred to them under this Agreement, a firm of [Chartered
Accountants] to be agreed by the Seller and the Purchaser within seven days of a
notice by one to the other requiring such agreement or failing such agreement to be
nominated on the application of either of them by or on behalf of the President for the
time being of the Institute of Chartered Accountants in England and Wales];
“Seller Insurance Policies” means all insurance policies (whether under policies
maintained with third party insurers or any member of the Seller‟s Group), other than
Group Insurance Policies, maintained by the Seller under which, immediately prior to
the Closing Date, any Group Company is entitled to any benefit, and “Seller
Insurance Policy” means any one of them;
“SDLT” means Stamp Duty Land Tax;
“Seller’s Group” means the Seller and its [subsidiaries] [subsidiary undertakings]
from time to time;
“Seller’s Lawyers” means [ ] of [ ];
“Seller’s Pension Scheme” means the pension scheme[s] of the [Company] [Group
Companies] in force at the date of this Agreement;
“Seller’s Warranties” means the warranties and representations given by the Seller
pursuant to Clause 9 and Schedule 7 and “Seller’s Warranty” means any one of them;
“Senior Employee” means any employee employed or engaged in relation to the
Group on a base annual salary (on the basis of full-time employment) in excess of
[ ] or local equivalent;
“Shares” means [ ] ordinary shares of [ ] each, being the whole of the issued
[ordinary] share capital of the Company;
“Subsidiaries” means the [subsidiaries] [subsidiary undertakings] listed in paragraph 2
of Schedule 1 [together with any other [subsidiaries] [subsidiary undertakings] of the
Company] and “Subsidiary” means any one of them;
“Taxation” or “Tax” shall have the meannig given in the Tax Indemnity;
“Tax Authority” shall have the meaning given in the Tax Indemnity;
[“Tax Indemnity” means the deed of covenant against Taxation in the Agreed Terms
to be entered into at Closing;]
[“UK Listing Authority” means the Financial Services Authority in its capacity as
competent authority for listing under the Financial Services and Markets Act 2000;]
“VAT” means United Kingdom Value Added Tax.
1.2 Modification etc. of Statutes
References to a statute or statutory provision include:
1.2.1 that statute or provision as from time to time modified, re-enacted or
consolidated whether before or after the date of this Agreement;
1.2.2 any past statute or statutory provision (as from time to time modified, re-
enacted or consolidated) which that statute or provision has directly or
indirectly replaced; and
1.2.3 any subordinate legislation made from time to time under that statute or
statutory provision [which is in force at the date of this Agreement][,
except to the extent that any statute, statutory provision or subordinate legislation
made or enacted after the date of this Agreement would create or increase a
liability of the Seller under this Agreement [other documents]].
1.3 Singular, plural, gender
References to one gender include all genders and references to the singular include the
plural and vice versa.
1.4 References to persons and companies
References to:
1.4.1 a person include any company, partnership or unincorporated association
(whether or not having separate legal personality); and
1.4.2 a company shall include any company, corporation or any body corporate,
wherever incorporated.
1.5 References to subsidiaries and holding companies
The words “holding company”, “subsidiary” and “subsidiary undertaking” shall
have the same meaning in this Agreement as their respective definitions in the
Companies Act 1985 or the Companies Act 2006, as applicable.
1.6 Connected Persons
A person shall be deemed to be connected with another if that person is connected with
such other within the meaning of Section 839 of ICTA 1988.
1.7 Accounts
Any reference to “accounts” shall include the directors‟ and auditors‟ reports, relevant
balance sheets and profit and loss accounts and related notes together with all
documents which are or would be required by law to be sent to members in respect of
the accounting reference period in question.
1.8 Schedules etc.
References to this Agreement shall include any [Recitals and] Schedules to it and
references to Clauses and Schedules are to Clauses of, and Schedules to, this
Agreement. References to paragraphs and Parts are to paragraphs and Parts of the
Schedules.
1.9 Headings
Headings shall be ignored in interpreting this Agreement.
1.10 Information
References to books, records or other information mean books, records or other
information in any form including paper, electronically stored data, magnetic media,
film and microfilm.
1.11 Legal Terms
References to any English legal term shall, in respect of any jurisdiction other than
England, be construed as references to the term or concept which most nearly
corresponds to it in that jurisdiction.
2 Agreement to Sell the Shares
2.1.1 On and subject to the terms of this Agreement, the Seller agrees to sell, and the
Purchaser agrees to purchase, the Shares.
2.1.2 The Shares shall be sold by the Seller, with full title guarantee, free from
Encumbrances and together with all rights and advantages attaching to them as
at Closing (including, without limitation, the right to receive all dividends or
distributions declared, made or paid on or after Closing).
2.1.3 The Seller shall procure that on or prior to Closing any and all rights of pre-
emption over the Shares are waived irrevocably by the persons entitled thereto.
3 Consideration
3.1 Amount
The consideration for the purchase of the Shares under this Agreement shall be an
amount in cash equal to the sum of:
3.1.1 [●] (the “Closing Amount”); and
3.1.2 the Net Asset Adjustment.
3.2 Reduction of Consideration
If any payment is made by the Seller to the Purchaser in respect of any claim for any
breach of this Agreement (including a payment made under Clause 9.7) or pursuant to
an indemnity under this Agreement (or any agreement entered into under this
Agreement), the payment shall be made by way of adjustment of the consideration
paid by the Purchaser for the Shares under this Agreement and the consideration shall
be deemed to have been reduced by the amount of such payment.
4 Conditions
4.1 Conditions Precedent
The agreement to sell and purchase the Shares contained in Clause 2 is conditional
upon satisfaction of the following conditions, or their satisfaction subject only to
Closing:
4.1.1 [the passing at a general meeting of [the Seller] [the Purchaser] of [a resolution
to approve the [sale] [acquisition] of the Shares] in the Agreed Terms or without
material amendments thereto [or with such amendments as [ ] may agree];
4.1.2 To the extent that the proposed acquisition of all or any of the Shares (the
“Transaction”) either constitutes (or is deemed to constitute under Article 4(5))
a concentration falling within the scope of Council Regulation (EC) 139/2004
(as amended) (the “Regulation”) or is to be examined by the European
Commission as a result of a decision under Article 22(3) of the Regulation:
(i) the European Commission taking a decision (or being deemed to have
taken a decision) under Article 6(1)(b) [or, if the Commission has
initiated proceedings pursuant to Article 6(1)(c), under Article 8(1) or
8(2)] of the Regulation] declaring the Transaction compatible with the
common market, without imposing any conditions or obligations that are
not on terms reasonably satisfactory to the [Purchaser/Parties]; or
(ii) the European Commission taking a decision (or being deemed to have
taken a decision) to refer the whole or part of the Transaction to the
competent authorities of one or more Member States under Articles 4(4)
or 9(3) of the Regulation; and
(a) each such authority taking a decision with equivalent effect to
Clause 4.1.3(i) with respect to those parts of the Transaction
referred to it; and
(b) the European Commission taking any of the decisions under
Clause 4.1.3(i) with respect to any part of the Transaction retained
by it.
4.1.3 the consent by [ ] to the sale and purchase of the Shares having been obtained
[on terms reasonably acceptable to the Purchaser].
4.2 Responsibility for Satisfaction
4.2.1 The Seller shall use [best] [all reasonable] endeavours to ensure the satisfaction
of the conditions set out in Clause 4.1.[ ] and the Purchaser shall use [best] [all
reasonable] endeavours to ensure the satisfaction of the conditions set out in
Clause[s] 4.1.[ ] [in each case as soon as possible] [provided that this shall not
give rise to an obligation on the part of either party to assume material
expenditure to achieve the same or require either party to take such action
which would be likely to have such a detrimental effect on the current or future
development of the business of that party that it would be unreasonable to
expect that party to take it].
4.2.2 [Without prejudice to Clause 4.2.1, the Seller and the Purchaser agree that all
requests and enquiries from any government, governmental, supranational or
trade agency, court or other regulatory body which relate to the satisfaction of
the conditions set out in Clause 4.1.[ ] shall be dealt with by the Seller and the
Purchaser in consultation with each other and the Seller and the Purchaser shall
promptly co-operate with and provide all necessary information and assistance
reasonably required by such government, agency, court or body upon being
requested to do so by the other.]
4.3 Non-Satisfaction/Waiver
4.3.1 The party responsible for satisfaction of each condition in Clause 4.2 shall give
notice to the other party of the satisfaction of the relevant condition within
[two] Business Days of becoming aware of the same.
4.3.2 The Purchaser may at any time waive in whole or in part and conditionally or
unconditionally the conditions set out in Clause 4.1.[ ] by notice in writing to
the Seller.
4.3.3 The Seller may at any time waive in whole or in part and conditionally or
unconditionally the conditions set out in Clause 4.1.[ ] by notice in writing to
the Purchaser.
4.3.4 If the conditions in Clause 4.1 are not satisfied [or waived] on or before ● [save
as expressly provided, this Agreement (other than Clauses 1, 13 and 15.2 to
15.18) shall lapse] [the Purchaser or the Seller may, in its sole discretion,
terminate this Agreement and neither the Seller nor the Purchaser shall have
any claim against the other under it, save for any claim arising from breach of
[any] obligation contained in Clause 4.2.]
5 Pre-Closing
5.1 The Seller’s Obligations in Relation to the Conduct of Business
The Seller undertakes to [use reasonable endeavours to] procure that between the date
of this Agreement and Closing each Group Company:
5.1.1 shall carry on its business as a going concern in the ordinary and usual course
as carried on prior to the date of this Agreement, save in so far as agreed in
writing by the Purchaser [such consent not to be unreasonably withheld or
delayed];
5.1.2 shall [and/or shall procure that the relevant members of the Seller‟s Group
shall] maintain in force all Group Insurance Policies and all Seller Insurance
Policies [in all material respects on the same terms and with a similar level of
cover to that prevailing at the date of this Agreement] inter alia for the benefit
of the Group Companies;
5.1.3 [subject to Clause 14] shall [and/or shall procure that the relevant members of
the Seller‟s Group shall] notify to the insurers of [the Group Insurance Policies
and/ or] the Seller Insurance Policies all insurance claims in relation to the
Group Companies of which [the relevant members of the Seller‟s Group]
[specified individuals] become aware (i) promptly and (ii) in accordance with
the requirements of the relevant insurance policy, and thereafter not do or omit
to do anything that might prejudice any such claim;
5.1.4 without prejudice to the generality of Clause 5.1.1, shall not [except as may be
required to give effect to and to comply with this Agreement] without the
prior written consent of the Purchaser [such consent not to be unreasonably
withheld or delayed]:
(i) enter into, or exercise an option in relation to, any agreement or incur
any commitment involving any capital expenditure in excess of
£[ ] per item and £[ ] in aggregate, in each case exclusive
of VAT;
(ii) enter into, or exercise an option in relation to, or amend, any agreement
or incur any commitment which is not capable of being terminated
without compensation at any time with [three] months‟ notice or less or
which is not in the ordinary and usual course of business or which
involves or may involve total annual expenditure in excess of
£[ ], exclusive of VAT;
(iii) acquire or dispose of, or agree to acquire or dispose of, any material
asset or material stock, or enter into or amend any agreement or incur
any commitment to do so, in each case involving consideration,
expenditure or liabilities in excess of £[ ], exclusive of VAT
[other than in the ordinary and usual course of business];
(iv) [acquire or agree to acquire any share, shares or other interest in any
company, partnership or other venture[, other than an investment of [5]
per cent or less of the total shares or interest in such company,
partnership or venture];]
(v) incur any additional borrowings or incur any other indebtedness [in
each case in excess of [ ] and otherwise than in the ordinary and
usual course of business];
(vi) create, allot or issue any share capital or loan capital of any Group
Company or any option to subscribe for the same;
(vii) repay, redeem or repurchase any share capital or loan capital of any
Group Company;
(viii) declare, make or pay any dividend or other distribution to shareholders;
(ix) [take steps to procure payment by any debtor generally in advance of the
date on which book and other debts are usually payable in accordance
with the standard terms of business of any Group Company or (if
different) the period extended to any particular debtor in which to make
payment;]
(x) [delay making payment to any trade creditors generally beyond the date
on which payment of the relevant trade debt should be paid in
accordance with the credit period authorised by the relevant creditors (or
(if different) the period extended by creditors in which to make
payment);]
(xi) amend, to any material extent, any of the terms on which goods,
facilities or services are supplied[, such supplies being material in the
context of the relevant Group Company,] [except where required to
do so in order to comply with any applicable legal or regulatory
requirement];
(xii) save as required by law:
(a) make any [material] amendment to the terms and conditions of
employment (including, without limitation, remuneration, pension
entitlements and other benefits) of any [employee] [Senior
Employee] (other than minor increases in the ordinary and usual
course of business which the Seller shall notify to the Purchaser as
soon as reasonably possible);
(b) provide or agree to provide any gratuitous payment or benefit to
any such person or any of his dependants;
(c) dismiss any [employee] [Senior Employee]; or
(d) engage or appoint any additional [employee] [Senior Employee];
(xiii) discontinue or amend the Seller‟s Pension Scheme to any material extent
or commence to wind it up or terminate it or cause it to cease to admit
new members;
(xiv) communicate to any Relevant Employee any material plan, proposal or
intention to discontinue, amend, wind up, terminate or exercise any
discretion [other than in the ordinary and usual course of business]
in relation to the Seller‟s Pension Scheme;
(xv) pay any benefits under the Seller‟s Pension Scheme otherwise than in
accordance with the terms of the documents governing the Seller‟s
Pension Scheme and not under any discretionary power;
(xvi) [enter into any guarantee, indemnity or other agreement to secure any
obligation of a third party or create any Encumbrance over any of its
assets or undertaking in any such case [other than in the ordinary and
usual course of business]];
(xvii) [settle any insurance claim made by or on behalf of any Group Company
[or the Seller shall procure that the relevant members of the Seller‟s
Group shall not settle any insurance claim made by or on behalf of any
Group Company] in excess of [ ] materially below the amount claimed];
(xviii) make any change to its accounting practices or policies or amend its
memorandum or articles of association.
5.2 Other Seller’s Obligations Prior to Closing
5.2.1 Without prejudice to the generality of Clause 5.1, prior to Closing the Seller
shall, and shall procure that the Group Companies shall, allow the Purchaser
and its agents, upon reasonable notice, [reasonable] access to, and to take
copies of, the books, records and documents of or relating in whole or in part to
the Group[, provided that the obligations of the Seller under this Clause
shall not extend to allowing access to information which is reasonably
regarded as confidential to the activities of the Seller otherwise than in
relation to the Group Companies].
6 Closing
6.1 Date and Place
Subject to Clause 4, Closing shall take place at [time] at [location] on [date], or on the
[ ] Business Day following notification of the fulfilment or waiver of the
condition(s) set out in Clause 4.1, whichever is the later, or at such other location, time
or date as may be agreed between the Purchaser and the Seller.
6.2 Closing Events
On Closing, the Seller and the Purchaser shall comply with their respective obligations
specified in Schedule 5.
6.3 Payment on Closing
On Closing, the Purchaser shall pay the Closing Amount to the Seller.
6.4 Breach of Closing Obligations
If the Seller or the Purchaser fails to comply with any material obligation in Clauses
6.2 and 6.3 and Schedule 5, the Purchaser, in the case of non-compliance by the Seller,
or the Seller, in the case of non-compliance by the Purchaser, shall be entitled (in
addition to and without prejudice to all other rights or remedies available, including the
right to claim damages) by written notice to the other [served on the Closing Date]:
6.4.1 to terminate this Agreement (other than Clauses 1, 13 and 15.2 to 15.18)
without liability on its part; or
6.4.2 to effect Closing so far as practicable having regard to the defaults which have
occurred; or
6.4.3 to fix a new date for Closing (being not more than 20 Business Days after the
agreed date for Closing) in which case the provisions of Schedule 5 shall apply
to Closing as so deferred but provided such deferral may only occur once.
7 Post-Closing Adjustments
7.1 Net Asset Statement
The Purchaser shall procure that as soon as practicable following Closing there shall be
drawn up a draft of the Net Asset Statement (the “Draft Net Asset Statement”) in
accordance with Schedule 6 setting out all the assets and all the liabilities of the Group
Companies on a [consolidated] [unconsolidated] basis.
7.2 Determination of Net Asset Statement
7.2.1 The Draft Net Asset Statement as agreed or determined pursuant to paragraph 3
of Schedule 6:
(i) shall constitute the Net Asset Statement for the purposes of this
Agreement; and
(ii) shall be final and binding on the Seller and the Purchaser.
7.2.2 The Net Assets shall be derived from the Net Asset Statement.
7.3 Adjustment to Consideration
7.3.1 Net Assets
(i) If the Net Assets are less than the Estimated Net Assets, the Seller shall
repay to the Purchaser an amount equal to the deficit of the Net Assets
below the Estimated Net Assets as a reduction in the consideration.
(ii) If the Net Assets exceed the Estimated Net Assets, the Purchaser shall
pay to the Seller an additional amount equal to the excess of the Net
Assets over the Estimated Net Assets as an increase in the consideration.
(iii) Any payments pursuant to this Clause shall be made on or before [10]
Business Days after the date on which the process described in
paragraph 3 of Schedule 6 for the preparation of the Net Asset Statement
is complete.
7.3.2 Interest
Any payment to be made in accordance with this Clause 8 shall include interest
thereon calculated from the Closing Date to the date of payment at a rate per
annum of [ ] per cent [above the [specify rate] from time to time of [name of
bank]. Such interest shall accrue from day to day [and shall be compounded
monthly].
[If any part of the Group falls within the European Union Emissions Trading Scheme please
seek input from a member of the Environment and Planning Group (Group 340). See Drafting
Notes 74350.]
8 Warranties
8.1 The Seller’s Warranties
8.1.1 Subject to Clause 9.2, the Seller warrants and represents to the Purchaser that
the statements set out in Schedule 7 are true and accurate and not misleading as
of the date of this Agreement
8.1.2 The Seller acknowledges that the Purchaser has entered into this Agreement in
reliance upon the Seller‟s Warranties.
8.1.3 Each of the Seller‟s Warranties shall be separate and independent and shall not
be limited by reference to any other paragraph of Schedule 7 or by anything in
this Agreement [or in the Tax Indemnity] [or in the Environment Indemnity].
8.1.4 Any Seller‟s Warranty qualified by the expression “to the best of the Seller‟s
knowledge, information and belief” or any similar expression shall, unless
otherwise stated, be deemed to refer to the knowledge of the persons whose
names and addresses are set out in Schedule  [who shall be deemed to have
knowledge of such matters as they would have discovered, had they made [due
and careful] [reasonable] enquiries].
8.1.5 [A claim for breach of any Seller‟s Warranty may be made whether or not the
relevant facts, matters or circumstances giving rise to the breach:
(i) were known to the Purchaser or to any of the directors, officers,
employees or agents of the Purchaser or could have been discovered
(whether by any investigation made by or on behalf of the Purchaser into
the affairs of any Group Company or otherwise) prior to the signing of
this Agreement; or
(ii) were notified to the Purchaser in accordance with Clause 9.3.
This Clause shall not apply if the facts, matters or circumstances giving rise to
the breach are disclosed in accordance with Clause 9.2.]
8.2 Seller’s Disclosures
The Seller‟s Warranties are subject to the matters which are [fully and] fairly disclosed
in [or pursuant to] this Agreement or the Disclosure Letter (including the documents
referred to in the Disclosure Letter) [provided that such matters are disclosed in
sufficient detail to enable the Purchaser to assess [their impact on any Group
Company] [the matters in question]].
8.2.1 Any notification pursuant to Clause 9.3.1 shall not operate as a disclosure
pursuant to Clause 9.2 of this Agreement and the Seller‟s Warranties shall not
be subject to such notification.]
8.3 Effect of Closing
The Seller‟s Warranties and all other provisions of this Agreement [and the Tax
Indemnity] [and the Environment Indemnity], to the extent that they have not been
performed by Closing, shall not be extinguished or affected by Closing or by any other
event or matter (including, without limitation, any satisfaction and/or waiver of any
condition contained in Clause 4.1), except by a specific and duly authorised written
waiver or release by the Purchaser.
9 Limitation of Seller’s Liability
[Clause 10 sets out a number of Seller limitations but, when acting for the Purchaser,
not all (including in particular those in square brackets), and sometimes none, may be
appropriate. See Clause 11 of P6 International Share Sale Agreement (DocExplorer
2371562) for additional limitations or when acting for the Seller.]
9.1 Time Limitation for Claims
The Seller shall not be liable [for breach of any Seller‟s Warranty] [under this
Agreement] [or the Tax Indemnity] [or the Environment Indemnity] in respect of
any claim unless a notice of the claim is given by the Purchaser to the Seller:
9.1.1 in the case of any claim under paragraph 14 of Schedule 7 (tax warranties) [or
under the Tax Indemnity], within [seven] years following Closing;
9.1.2 in the case of any claim under paragraph 9 of Schedule 7 (environmental and
health and safety warranties) [or under the Environment Indemnity], within 
years following Closing; and
9.1.3 in the case of any other claim, within [ months/years following Closing] [28
days following signature by the auditors of the Group of their audited accounts
for the financial period ending ],
except that there shall be no time limitation for giving notice of any claim under
paragraphs 1.1, 17.1.1, 17.1.2, 17.1.3 or 17.1.4 of Schedule 7. Any claim notified by
the Purchaser to the Seller pursuant to this Clause shall specify the matters set out in
Clause 11.2.
9.2 Minimum Claims
9.2.1 The Seller shall not be liable [for breach of any Seller‟s Warranty] [under this
Agreement] [or the Tax Indemnity] [or the Environment Indemnity] in
respect of any individual claim (or a series of claims arising from substantially
identical facts or circumstances) where the liability agreed or determined
(disregarding the provisions of this Clause 10.2) in respect of any such claim or
series of claims does not exceed £.
9.2.2 Where the liability agreed or determined in respect of any such claim or series
of claims exceeds £, [subject as provided elsewhere in this Clause 10, the
Seller shall be liable for the amount of the claim or series of claims as agreed or
determined] [the liability of the Seller shall be limited to the amount of the
excess].
9.3 Aggregate Minimum Claims
9.3.1 The Seller shall not be liable [for breach of any Seller‟s Warranty] [under this
Agreement] [or the Tax Indemnity] [or the Environment Indemnity] in
respect of any claim unless the aggregate amount of all claims for which the
Seller would otherwise be liable [for breach of any Seller‟s Warranty] [under
this Agreement] [and the Tax Indemnity] [or the Environment Indemnity]
(disregarding the provisions of this Clause 10.3) exceeds £.
9.3.2 Where the liability agreed or determined in respect of all claims referred to in
Clause 10.3.1 exceeds £ [subject as provided elsewhere in this Clause 10, the
Seller shall be liable for the aggregate amount of all claims as agreed or
determined] [the liability of the Seller shall be limited to the amount of the
excess].
9.4 Maximum Liability
The aggregate liability of the Seller in respect of all breaches of [the Seller‟s
Warranties] [this Agreement] [and the Tax Indemnity] [and the Environment
Indemnity] shall not exceed £.
9.5 Provisions
The Seller shall not be liable [for breach of any Seller‟s Warranty] [under this
Agreement] [or the Tax Indemnity] [or the Environment Indemnity] in respect of
any claim if and to the extent that proper allowance, provisions or reserve is made in
the [Net Asset Statement] [Accounts] for the matter giving rise to the claim.
9.6 Matters Arising Subsequent to this Agreement
The Seller shall not be liable [for breach of any Seller‟s Warranty] [under this
Agreement] [or the Tax Indemnity] [or the Environment Indemnity] in respect of
any matter to the extent that the same would not have occurred but for:
9.6.1 Agreed matters
any matter or thing done or omitted to be done pursuant to and in compliance
with this Agreement [or the Tax Indemnity] [or the Environment Indemnity]
or otherwise at the request in writing or with the approval in writing of the
Purchaser;
9.6.2 [Acts of the Purchaser
any act, omission or transaction of the Purchaser or any member of the
Purchaser’s Group or any of the Group Companies, or their respective
directors, officers, employees or agents or successors in title, after Closing
[done, committed or effected:
(i) outside the ordinary [and usual] course of business [and in the
knowledge that such act, omission or transaction might give rise to, or
increase the extent of, a claim under this Agreement [or the Tax
Indemnity] [or the Environment Indemnity]] or in circumstances where
such claim was reasonably foreseeable as a result of such act, omission
or transaction]; or
(ii) otherwise than pursuant to a legally binding commitment to which the
Group is subject on or before Closing;]
9.6.3 Changes in legislation
(i) the passing of, or any change in, after [Closing] [the date of this
Agreement], any law, rule, regulation or administrative practice of any
government, governmental department, agency or regulatory body
including (without prejudice to the generality of the foregoing) any
increase in the rates of Taxation or any imposition of Taxation or any
withdrawal of relief from Taxation not actually (or prospectively) in
effect at [the date of this Agreement] [Closing]; or
(ii) any change after [Closing] [the date of this Agreement] of any
generally accepted interpretation or application of any legislation;
9.6.4 Accounting [and Taxation] Policies
any change in accounting [or Taxation] policy, bases or practice of the
Purchaser or any of the Group Companies introduced or having effect after
Closing.
9.7 Fraud
None of the limitations contained in this Clause 10 shall apply to any claim which
arises or is increased, or to the extent to which it arises or is increased, as the
consequence of, or which is delayed as a result of, fraud, [wilful misconduct, wilful
concealment or gross negligence] by the Seller, any Group Company or any of their
respective directors, officers, employees or agents.
10 Claims
[When acting for the Purchaser, and the Seller-friendly drafting in bold and Clause
11.5 are omitted, consider whether to incorporate Clause 11.2 into Clause 10.1 and
delete the rest of Clause 11. See the Drafting Notes for further information.]
10.1 Notification of Claims under this Agreement
Notices of claims [for breach of Seller‟s Warranty] [under this Agreement] [or
under] [the Tax Indemnity] [the Environment Indemnity] shall be given by the
Purchaser to the Seller within the time limits specified in Clause 10.1, specifying [in
reasonable detail] [full information in relation to] the legal and factual basis of the
claim and the evidence on which the Purchaser relies [and, if practicable, an estimate
of the amount of Losses which are, or are to be, the subject of the claim (including any
Losses which are contingent on the occurrence of any future event)].
10.2 [Commencement of Proceedings
Any claim notified pursuant to Clause 11.2 shall (if it has not been previously
satisfied, settled or withdrawn) be deemed to be irrevocably withdrawn [six]
months after [the notice is given pursuant to Clause 11.2] [the relevant time limit
set out in Clause 10.1] [or in the case of any contingent liability, [six] months after
such contingent liability becomes an actual liability and is due and payable]
unless legal proceedings in respect of it have been commenced by being both
issued and served.]
10.3 [Investigation by the Seller
In connection with any matter or circumstance that may give rise to a claim
against the Seller [for breach of any Seller‟s Warranty] [under this Agreement] [or
under] [the Tax Indemnity] [the Environment Indemnity]:
10.3.1 the Purchaser shall allow, and shall procure that the relevant Group
Company allows, the Seller and its financial, accounting or legal advisers to
investigate the matter or circumstance alleged to give rise to a claim and
whether and to what extent any amount is payable in respect of such claim;
and
10.3.2 the Purchaser shall disclose to the Seller all material of which the
Purchaser is aware which relates to the claim and shall, and shall procure
that any other relevant members of the Purchaser’s Group shall, give,
subject to their being paid all reasonable costs and expenses, all such
information and assistance, including access to premises and personnel,
and the right to examine and copy or photograph any assets, accounts,
documents and records, as the Seller or its financial, accounting or legal
advisers may reasonably request subject to the Seller agreeing in such form
as the Purchaser may reasonably require to keep all such information
confidential and to use it only for the purpose of investigating and
defending the claim in question.]
10.4 [Conduct of Third Party Claims
If the matter or circumstance that may give rise to a claim against the Seller [for breach
of any Seller‟s Warranty] [under this Agreement] [or under] [the Tax Indemnity]
[the Environment Indemnity] is a result of or in connection with a claim by or
liability to a third party then the Purchaser or other member of the Purchaser‟s Group
shall be entitled, in its absolute discretion, to take such action as it shall deem
necessary to avoid, dispute, deny, defend, resist, appeal, compromise or contest such
claim or liability (including, without limitation, making counterclaims or other claims
against third parties) but shall, so far as practicable[, without prejudice to the rights of
the insurers of the Purchaser‟s Group,] consult with the Seller before taking any such
action.]
11 Restrictions on the Seller
11.1 Restrictions
The Seller undertakes with the Purchaser [as trustee for itself] and the Group
Companies that no member of the Seller‟s Group, no directors of any member of the
Seller‟s Group [and no connected persons of any member of the Seller‟s Group or of
their directors] will [and will procure that no person, firm or company carrying on with
the consent or privity of any member of the Seller‟s Group any business in succession
to the member of the Seller‟s Group concerned will] in any Relevant Capacity during
the Restricted Period:
11.1.1 directly or indirectly carry on, be engaged in or be economically interested in
any business which is of the same or similar type to the business of any Group
Company as now carried on and which is or is likely to be in competition with
the business of any Group Company as now carried on;
11.1.2 [in competition with the business of any Group Company as now carried
on,] canvass or solicit the custom of any person, firm or company who has
within [two years] prior to Closing been a [regular] [frequent] customer of any
Group Company in relation to the business of the Group; or
11.1.3 induce or seek to induce any present Restricted Employee to become employed
whether as employee, consultant or otherwise by any member of the Seller‟s
Group, whether or not such Restricted Employee would thereby commit a
breach of his contract of service. [The placing of an advertisement of a post
available to a member of the public generally and the recruitment of a
person through an employment agency shall not constitute a breach of this
Clause 12 provided that no member of the Seller’s Group encourages or
advises such agency to approach any Restricted Employee.]
11.2 Exceptions
The restrictions in Clause 12.1 shall not operate to prohibit any member of the
Seller’s Group from:
11.2.1 carrying on or being engaged in or being economically interested in any
business which is of the same or similar type to the business as now carried
on by the Group after such time as the Purchaser ceases to carry on or be
engaged in or economically interested in [a substantial part of] the business
carried on by the Group;
11.2.2 holding or being interested in up to [5 per cent] of the outstanding issued
share capital of a company listed on [the Official List and admitted to
trading by London Stock Exchange plc or dealt in on the Alternative
Investment Market] [any recognised stock exchange];
11.2.3 fulfilling any obligation pursuant to this Agreement and any agreement to
be entered into pursuant to this Agreement;
11.2.4 acquiring the whole or part of any business which is of a same or similar
type to the business of the Group as now carried on and which is or is
likely to be in competition with any part of the business of the Group as
now carried on if the turnover attributed to the business to be acquired in
the last financial year is less than [ ].
11.3 Reasonableness of Restrictions
The Seller agrees that the restrictions contained in this Clause are no greater than is
reasonable and necessary for the protection of the interests of the Purchaser [and the
Group Companies] but if any such restriction shall be held to be void but would be
valid if deleted in part or reduced in application, such restriction shall apply with such
deletion or modification as may be necessary to make it valid and enforceable.
11.4 Interpretation
The following terms shall have the following meanings respectively in this Clause 12:
11.4.1 “Relevant Capacity” means for its own account or for that of any person, firm
or company (other than the Purchaser [or the Group Companies]) [or in any
other manner] [and whether through the medium of any company controlled by
it (for which purpose there shall be aggregated with its shareholding or ability
to exercise control the shares held or control exercised by any person connected
with the Seller) or as principal, partner, director, employee, consultant or agent].
11.4.2 “Restricted Employee” means any Relevant Employee who [(a) has access to
trade secrets or other confidential information of the Group;] [(b) has
participated in discussions relating to the transaction pursuant to this
Agreement;] [or (c) [holds the position of [assistant director] [Grade ] or
higher] [is a Senior Employee];
11.4.3 “Restricted Period” means [two years] commencing on Closing or such
shorter period of time recognised by applicable law as being binding on the
Seller.
12 Confidentiality
12.1 Announcements
Pending Closing, no announcement or circular in connection with the existence or the
subject matter of this Agreement shall be made or issued by or on behalf of any
member of the Seller‟s Group or any member of the Purchaser‟s Group without the
prior written approval of the Seller and the Purchaser. This shall not affect any
announcement or circular required by law or any regulatory body or the rules of any
recognised stock exchange [on which the shares of either party are listed] but the party
with an obligation to make an announcement or issue a circular shall consult with the
other party insofar as is reasonably practicable before complying with such an
obligation.
12.2 Confidentiality
12.2.1 [The Confidentiality Agreement shall cease to have any force or effect from
[the date of this Agreement] [Closing].] or [This Clause shall be without
prejudice to the Confidentiality Agreement, which Agreement shall continue
notwithstanding [this Agreement] [Closing]].
12.2.2 Subject to Clauses 13.1 and 13.2.3:
(i) each of the Seller and the Purchaser shall treat as strictly confidential
and not disclose or use any information received or obtained as a result
of entering into this Agreement (or any agreement entered into pursuant
to this Agreement) which relates to:
(a) the existence and the provisions of this Agreement and of any
agreement entered into pursuant to this Agreement; or
(b) the negotiations relating to this Agreement (and any such other
agreements);
(ii) the Seller shall treat as strictly confidential and not disclose or use any
information relating to the Group Companies following Closing and any
other information relating to the business, financial or other affairs
(including future plans and targets) of the Purchaser‟s Group;
(iii) the Purchaser shall treat as strictly confidential and not disclose or use
any information relating to the business, financial or other affairs
(including future plans and targets) of the Seller‟s Group including, prior
to Closing, the Group Companies.
12.2.3 Clause 13.2.2 shall not prohibit disclosure or use of any information if and to
the extent:
(i) the disclosure or use is required by law, any regulatory body or any
recognised stock exchange [on which the shares of [the Seller][any
member of the Seller‟s Group] or [the Purchaser][any member of the
Purchaser‟s Group] are listed [(including where this is required as part of
any actual or potential offering, placing and/or sale of securities of any
member of the Seller‟s Group or the Purchaser‟s Group)]];
(ii) the disclosure or use is required to vest the full benefit of this Agreement
in the Seller or the Purchaser;
(iii) the disclosure or use is required for the purpose of any judicial
proceedings arising out of this Agreement or any other agreement
entered into under or pursuant to this Agreement or the disclosure is
made to a Tax Authority in connection with the Tax affairs of the
disclosing party;
(iv) the disclosure is made to professional advisers [or actual or potential
financiers] of [the Seller][any member of the Seller‟s Group] or [the
Purchaser][any member of the Purchaser‟s Group] on terms that such
professional advisers [or financiers] undertake to comply with the
provisions of Clause 13.2.2 in respect of such information as if they
were a party to this Agreement;
(v) the information is or becomes publicly available (other than by breach of
the Confidentiality Agreement or of this Agreement);
(vi) [the disclosure is made on a confidential basis to potential purchasers of
all or part of the Seller‟s Group or the Purchaser‟s Group or to their
professional advisers or financiers;]
(vii) the other party has given prior written approval to the disclosure or use;
or
(viii) the information is independently developed after Closing,
provided that prior to disclosure or use of any information pursuant to Clause
13.2.3(i), (ii) or (iii) [except in the case of disclosure to a Tax Authority], the
party concerned shall promptly notify the other party of such requirement with
a view to providing that other party with the opportunity to contest such
disclosure or use or otherwise to agree the timing and content of such disclosure
or use.
12.2.4 [On Closing, the Seller shall assign to the Purchaser, to the extent permitted by
the relevant agreement, the benefit of any confidentiality agreements entered
into by the Seller in connection with the sale of the Shares.]
13 Insurance
13.1 No cover under Seller Insurance Policies from Closing
The Purchaser acknowledges and agrees that from the Closing Date:
13.1.1 no Group Company will have or be entitled to the benefit of any Seller
Insurance Policy in respect of any event, act or omission, that takes place after
the Closing Date and it shall be the sole responsibility of the Purchaser to
ensure that adequate insurances are put in place for the Group with effect from
the Closing Date;
13.1.2 the Seller shall not be required to maintain any Seller Insurance Policy for the
benefit of any Group Company[, provided that it shall not cancel with
retrospective effect any „occurrence based‟ Seller Insurance Policy under which
any Group Company continues to be insured];
13.1.3 no Group Company shall make or shall be entitled to make or notify a claim
under any „claims made‟ Seller Insurance Policy in respect of any event, act or
omission that occurred prior to the Closing Date [except in accordance with
Clause 14.4 below].
13.2 Existing claims under Seller Insurance Policies
The Seller shall use reasonable endeavours after the Closing Date to recover all monies
due from insurers in respect of any insurance claim which has been made before the
Closing Date by or on behalf of any Group Company under any Seller Insurance
Policy and shall, to the extent that the Group has not already been indemnified prior to
the Closing Date in respect of the loss giving rise to the insurance claim, pay any
monies received in respect of such claim (after taking into account any deductible or
excess and less any Taxation suffered on the proceeds and any reasonable out of pocket
expenses suffered or incurred by the Seller or any member of the Seller‟s Group in
connection with such claim) to the Purchaser or, at the Purchaser‟s written direction,
the relevant Group Company as soon as practicable after receipt by the Seller.
13.3 New claims under occurrence-based policies
13.3.1 With respect to any event, act or omission relating to any Group Company that
occurred or existed prior to the Closing Date that is covered by an „occurrence-
based‟ Seller Insurance Policy, the Seller shall, at the direction of the Purchaser
or the relevant Group Company, make a claim under such insurance policy,
provided that:
(i) the Seller shall not be obliged to make any such claim if and to the
extent that such claim is covered by an insurance policy held by the
Purchaser or a member of the Purchaser‟s Group;
(ii) the claim is notified to the Seller within 5 Business Days of the
Purchaser becoming aware of the claim [and in any event within 3 years
after the Closing Date]
1
;

1
Alternatively, when acting for a Seller replace the set of square brackets in 14.3.1(ii) with the
following:
“and in any event:
(a) In respect of a claim under a Seller Insurance Policy relating to [material damage, business
interruption, crime, personal accident or travel], that claim is notified to the Seller not later than five Business
Days after the Closing Date; or
(b) In respect of a claim under a Seller Insurance Policy relating to [employers liability, workers
compensation, public and products liability, or motor], that claim is notified to the Seller not later than three
years after the Closing Date.”
(iii) the relevant Group Company shall be liable for any deductible or excess
payable in respect of the claim;
(iv) [the Purchaser agrees to reimburse the Seller or relevant other member
of the Seller‟s Group for any retrospective premium increases under the
insurance policy under which the claim is made, as such amounts are
determined in accordance with that insurance policy as a result of any
such claim made pursuant to this Clause 14.3.1.
13.3.2 In the event a Group Company notifies a claim pursuant to Clause 14.3.1, the
Seller shall, at the Purchaser‟s cost, make all necessary notifications and claims
under the relevant Seller Insurance Policy and the relevant Group Company
shall be entitled to be paid any proceeds actually received under the Seller
Insurance Policy (less any deductible or excess actually paid by the Seller or
any member of the Seller‟s Group and less any Taxation suffered on the
proceeds and any reasonable out of pocket expenses suffered or incurred by the
Seller or any member of the Seller‟s Group) provided that:
(i) the Seller shall not be required, pursuant to any requests made by the
Purchaser or any Group Company, to undertake or threaten litigation or
incur any expenditure or liability without being put in funds by the
Purchaser or such Group Company prior to incurring any such
expenditure or liability;
(ii) neither the Purchaser nor any Group Company shall be entitled to any
proceeds received by the Seller‟s Group under any Seller Insurance
Policy except to the extent that such proceeds relate to a claim made
pursuant to Clause 14.3.1 in respect of:
(a) an event, act or omission connected with the carrying on of the
business of the Group prior to the Closing Date;
(b) loss for which the relevant Group Company has not already been
reimbursed, indemnified or otherwise compensated for whether
under this Agreement or otherwise;
(iii) the Purchaser shall provide (and shall procure that the relevant Group
Company also provides) all assistance, information and co-operation
reasonably requested by the Seller or the Seller‟s representatives
(including the Seller's insurers, appointed claims handlers or any lawyers
instructed in relation to such claim); and
(iv) the Purchaser shall or shall procure that the relevant Group Company
shall pay or bear any deductible or excess element of any such claim.
14 Other Provisions
14.1 Further Assurances
14.1.1 Each of the Seller and the Purchaser shall, and shall use reasonable endeavours
to procure that any necessary third party shall, from time to time execute such
documents and perform such acts and things as either of the Seller or the
Purchaser may reasonably require to transfer the Shares to the Purchaser and to
give each of them the full benefit of this Agreement.
14.1.2 [Pending registration of the Purchaser as owner of the Shares, the Seller shall
exercise all voting and other rights in relation to such Shares in accordance with
the Purchaser‟s instructions.]
14.1.3 The Purchaser shall, and shall procure that the relevant Group Companies
shall, retain for a reasonable period from Closing the books, records and
documents of the Group Companies to the extent they relate to the period
prior to Closing and shall, and shall procure that the relevant Group
Companies shall, allow the Seller reasonable access to such books, records
and documents, including the right to take copies, at the Seller’s expense.
14.1.4 [Release of Guarantees
[See Drafting Notes in DocExplorer 74350 for the approach to take when
acting for a Seller and there is a private equity Purchaser.]
(i) The Purchaser shall use reasonable endeavours to procure by Closing or,
to the extent not done by Closing, [within ● days thereafter or to the
extent not done within such period,] as soon as reasonably practicable
thereafter, the release of the Seller or any member of the Seller‟s Group
[or any person connected with any of them] from any securities,
guarantees or indemnities given by or binding upon the Seller or any
member of the Seller‟s Group [or any person connected with any of
them] in respect of any liability of the Group Companies. Pending such
release the Purchaser shall indemnify the Seller and any member of the
Seller‟s Group [and any person connected with any of them] against all
amounts paid by any of them pursuant to any such securities, guarantees
and indemnities in respect of such liability of the Group Companies.
(ii) The Seller shall use reasonable endeavours to procure, by Closing or, to
the extent not done by Closing, [within ● days thereafter, or, to the
extent not done within such period,] as soon as reasonably practicable
thereafter, the release of each Group Company from any securities,
guaranties or indemnities given by or binding upon the Group Company
in respect of any liability of the Seller or any member of the Seller‟s
Group. Pending such release, the Seller shall indemnify the Group
Companies against all amounts paid by any of them pursuant to any such
securities, guarantees and indemnities in respect of such liability of the
Seller.]]
14.1.5 Intellectual Property
If the Seller, or any member of the Seller‟s Group, is a party to any Intellectual
Property opposition proceedings in any jurisdiction, the success or failure of
which would have a material impact on the business of [the Group][any Group
Company], the Seller will, at the request [and expense] of the Purchaser, co-
operate fully with the Purchaser in the conduct of such proceedings, including
any appeals, and will permit its name, or the name of the relevant company
within the Seller‟s Group, to be used for this purpose by the Purchaser].
14.2 [Whole Agreement
14.2.1 This Agreement contains the whole agreement between the Seller and the
Purchaser relating to the subject matter of this Agreement at the date of
this Agreement to the exclusion of any terms implied by law which may be
excluded by contract and supersedes any previous written or oral
agreement between the Seller and the Purchaser in relation to the matters
dealt with in this Agreement.
14.2.2 The Purchaser acknowledges that it has not been induced to enter this
Agreement by any representation, warranty or undertaking not expressly
incorporated into it.
14.2.3 So far as is permitted by law and except in the case of fraud, each of the
Seller and the Purchaser agrees and acknowledges that its only right and
remedy in relation to any representation, warranty or undertaking made
or given in connection with this Agreement shall be for breach of the terms
of this Agreement to the exclusion of all other rights and remedies
(including those in tort or arising under statute).
14.2.4 In Clauses 15.2.1 to 15.2.3, “this Agreement” includes [the Disclosure
Letter [,the Confidentiality Agreement] and] all documents entered into
pursuant to this Agreement.]
14.3 Reasonableness
Each of the Seller and the Purchaser confirms it has received independent legal advice
relating to all the matters provided for in this Agreement, including the terms of Clause
12 (Restrictions on the Seller) and Clause 15.2 (Whole Agreement) and agrees that the
provisions of this Agreement (including [the Disclosure Letter [,the Confidentiality
Agreement] and] all documents entered into pursuant to this Agreement) are fair and
reasonable.
14.4 Assignment
EITHER
[Assignment permitted]
14.4.1 [The Seller agrees that the benefit of every provision in this Agreement is given
to the Purchaser for itself and its successors in title [and assigns]. Accordingly,
the Purchaser (and its successors [and assigns]) may, without the consent of the
Seller, assign [to the beneficial owner for the time being of the Shares] the
benefit of all or any of the Seller‟s obligations under this Agreement, and/or any
benefit arising under or out of this Agreement, provided that the assignee shall
not be entitled to receive under this Clause any greater amount than that to
which the Purchaser would have been entitled.
14.4.2 [The Seller agrees that, upon the request of the Purchaser or its successors in
title [or assigns], this Agreement may be novated (in whole or in part) [in
favour of the beneficial owner for the time being of the Shares], and the
Seller shall execute a Novation Agreement substantially in the terms set out in
Schedule 9. If the Seller fails to execute any such Agreement within [14] days
of the request by the Purchaser, the Purchaser may execute it on behalf of the
Seller and for such purpose the Seller hereby irrevocably appoints the Purchaser
as the Seller‟s attorney for the purpose of executing any such Agreement. The
Seller agrees to ratify and confirm any action taken by the Purchaser by virtue
of this power of attorney.]]
OR
[Version 2 (no assignment, except to connected company)]
15.4.1 [Except as otherwise expressly provided in this Agreement, neither the
Seller nor the Purchaser may without the prior written consent of the other,
assign, grant any security interest over, hold on trust or otherwise transfer the
benefit of the whole or any part of this Agreement [nor shall the Purchaser be
entitled to make any claim against the Seller in respect of any Losses which
it does not suffer in its own capacity as beneficial owner of the Shares].
15.4.2 [Except as otherwise expressly provided in this Agreement, the Seller or
the Purchaser may, without the consent of the other, assign to a connected
company the benefit of the whole or any part of this Agreement provided that:
(i) if the assignee ceases to be a member of the Purchaser‟s Group (in the
case of an assignment by the Purchaser) or the Seller‟s Group (in the
case of an assignment by the Seller) it shall before so leaving assign the
benefit so far as assigned to it to another member of the Purchaser‟s
Group or the Seller‟s Group as the case may be;
(ii) the assignee shall not be entitled to receive under this Clause any greater
amount than that to which the Purchaser would have been entitled.]
For the purposes of this Clause, a “connected company” is a company which is
a subsidiary of the party concerned or which is a holding company of such party
or a subsidiary of such holding company.
14.5 Third Party Rights
14.5.1 A person who is not a party to this Agreement has no right under the Contracts
(Rights of Third Parties) Act 1999 to enforce any term of, or enjoy any benefit
under, this Agreement, except to the extent set out in this Clause 15.5.
14.5.2 [A Group Company or any of its respective directors, officers or agents or a
Relevant Employee may enforce and rely on Clause 9.5 to the same extent as if
it were a party.] [A Group Company (whilst the Group Company remains in the
Purchaser‟s Group) may enforce and rely on Clauses [12] and [ ] to the same
extent as if it were a party.]
14.5.3 [This Agreement may be terminated and any term may be amended or waived
without the consent of the person[s] named in Clause 15.5.2.]
14.6 Variation
No variation of this Agreement shall be effective unless in writing and signed by or on
behalf of each of the Seller and the Purchaser.
14.7 Time of the Essence
Time shall be of the essence of this Agreement both as regards any dates, [times] and
periods mentioned and as regards any dates, [times] and periods which may be
substituted for them in accordance with this Agreement or by agreement in writing
between the Seller and the Purchaser.
14.8 Method of Payment
Wherever in this Agreement provision is made for the payment by one party to the
other, such payment shall be effected by crediting for same day value the account
specified by the payee to the payer reasonably in advance and in sufficient detail to
enable payment by telegraphic or other electronic means to be effected on or before the
due date for payment.
14.9 Costs
14.9.1 The Seller shall bear all costs incurred by it [and the Seller‟s Group] in
connection with the preparation, negotiation and entry into of this Agreement[,
the Tax Indemnity] [and the Environment Indemnity] and the sale of the Shares.
14.9.2 The Purchaser shall bear all such costs incurred by it in connection with the
preparation, negotiation and entry into of this Agreement[, the Tax Indemnity]
[and the Environment Indemnity] and the purchase of the Shares.
14.10 [Stamp Duty, Fees and Taxes
The Purchaser shall bear the cost of all stamp duty[, any notarial fees] [and all
registration and transfer taxes and duties or their equivalents in all jurisdictions where
such fees, taxes and duties are payable] as a result of the transactions contemplated by
this Agreement. The Purchaser shall be responsible for arranging the payment of such
stamp duty [and all other such fees, taxes and duties, including fulfilling any
administrative or reporting obligation imposed by the jurisdiction in question in
connection with the payment of such taxes and duties]. The Purchaser shall indemnify
the Seller or any other member of the Seller‟s Group against any Losses suffered by
the Seller or member of the Seller‟s Group as a result of the Purchaser failing to
comply with its obligations under this Clause 15.10.]
14.11 Interest
If the Seller or the Purchaser defaults in the payment when due of any sum payable
under this Agreement, [or the Tax Indemnity] [or the Environment Indemnity] its
liability shall be increased to include interest on such sum from the date when such
payment is due until the date of actual payment (after as well as before judgment) at a
rate per annum of [ ] per cent [above the [base rate] from time to time of [name of
bank]]. Such interest shall accrue from day to day [and shall be compounded monthly].
14.12 Grossing-up of Indemnity Payments, VAT
14.12.1 All sums payable under this Agreement shall be paid free and clear of all
deductions, withholdings, set-offs or counterclaims whatsoever save only as
may be required by law. If any deductions or withholdings are required by law
the party making the payment shall (except in the case of interest payable under
Clause 15.11 or the Purchase Price) be obliged to pay to the other party such
sum as will after such deduction or withholding has been made leave the other
party with the same amount as it would have been entitled to receive in the
absence of any such requirement to make a deduction or withholding[, provided
that if either party to this Agreement shall have assigned or novated the benefit
in whole or in part of this Agreement then the liability of the other party under
this Clause 15.12.1 shall be limited to that (if any) which it would have been
had no such assignment or novation taken place].
14.12.2 If any Tax Authority charges to Taxation [(or would charge to Taxation in the
absence of any Purchaser‟s Reliefs available to the recipient)] any payment
made under this Agreement pursuant to an indemnity, compensation or
reimbursement provision [(including, for the avoidance of doubt, Clause 9.7)]
(other than Taxation attributable to a payment being treated [for the Purchaser]
as an adjustment to the consideration for the Shares under the terms of the
Agreement) then, except to the extent that the amount of the indemnity,
compensation or reimbursement provision has been increased to take account of
the Taxation that will be charged on receipt, the amount so payable shall be
grossed up by such amount as will ensure that after payment of the Taxation so
charged [(or which would have been so charged if any Purchaser‟s Reliefs
available to the recipient were ignored)] there shall be left a sum equal to the
amount that would otherwise be payable under this Agreement[, provided that if
either party to this Agreement shall have assigned or novated the benefit in
whole or in part of this Agreement then the liability of the other party under this
Clause 15.12.2 shall be limited to that (if any) which it would have been had no
such assignment or novation taken place.
14.12.3 [Where any payment made under this Agreement pursuant to an indemnity,
compensation or reimbursement provision (including, for the avoidance of
doubt, Clause 9.7) is paid to a person other than a party to this Agreement but is
treated as taxable in the hands of the party, the payer shall also pay to the party
such sum as shall reimburse such party for all Taxation suffered by it in respect
of the payment[, provided that if either party to this Agreement shall have
assigned or novated the benefit in whole or in part of this Agreement then the
liability of the other party under this Clause 15.12.3 shall be limited to that (if
any) which it would have been had no such assignment or novation taken
place.]
14.12.4 The recipient of an amount paid under this Clause 15 shall claim from the
appropriate Tax Authority any exemption, rate reduction, refund, credit or
similar benefit (including pursuant to any relevant double tax treaty) to which it
is entitled in respect of any deduction or withholding in respect of which a
payment has been made pursuant to Clause 15.12.1 and, for such purposes
shall, within any applicable time limits, submit any claims, notices, returns or
applications and send a copy thereof to the payer.
14.12.5 If the recipient of a payment made under this Agreement receives a credit for or
refund of any Taxation payable by it or similar benefit by reason of any
deduction or withholding for or on account of Taxation then it shall reimburse
to the other party such part of such additional amounts paid to it pursuant to
Clause 15.12.1 above as the recipient of the payment certifies to the other party
will leave it (after such reimbursement) in no better and no worse position than
it would have been if the other party had not been required to make such
deduction or withholding.
14.12.6 Where under the terms of this Agreement one party is liable to indemnify or
reimburse another party in respect of any costs, charges or expenses, the
payment shall include an amount equal to any VAT thereon not otherwise
recoverable by the other party, subject to that party using all reasonable
endeavours to recover such amount of VAT as may be practicable.
14.12.7 If any payment under this Agreement constitutes the consideration for a taxable
supply for VAT purposes, then in addition to that payment the payer shall pay
any VAT due.
14.13 Notices
14.13.1 Any notice or other communication in connection with this Agreement (each, a
“Notice”) shall be:
(i) in writing;
(ii) delivered by hand, fax, pre-paid first class post or courier [using an
internationally recognised courier company].
14.13.2 A Notice to the Seller shall be sent to the following address, or such other
person or address as the Seller may notify to the Purchaser from time to time:
[the Seller]
[Address]
Fax:
Attention: [Title]
14.13.3 A Notice to the Purchaser shall be sent to the following address, or such other
person or address as the Purchaser may notify to the Seller from time to time:
[the Purchaser]
[Address]
Fax:
Attention: [Title]
14.13.4 A Notice shall be effective upon receipt and shall be deemed to have been
received:
(i) [60] hours after posting, if delivered by pre-paid first class post
(ii) at the time of delivery, if delivered by hand or courier; or
(iii) at the time of transmission in legible form, if delivered by fax.
14.14 Invalidity
14.14.1 If any provision in this Agreement shall be held to be illegal, invalid or
unenforceable, in whole or in part, the provision shall apply with whatever
deletion or modification is necessary so that the provision is legal, valid and
enforceable and gives effect to the commercial intention of the parties.
14.14.2 To the extent it is not possible to delete or modify the provision, in whole or in
part, under Clause 15.14.1, then such provision or part of it shall, to the extent
that it is illegal, invalid or unenforceable, be deemed not to form part of this
Agreement and the legality, validity and enforceability of the remainder of this
Agreement shall, subject to any deletion or modification made under Clause
15.14.1, not be affected.
14.15 Counterparts
This Agreement may be entered into in any number of counterparts, all of which taken
together shall constitute one and the same instrument. The Seller and the Purchaser
may enter into this Agreement by signing any such counterpart.
14.16 Arbitration
[ICC Clause]
Subject to Clause 8 (Post-Closing Adjustments), any dispute arising out of or
connected with this Agreement, including a dispute as to the validity or existence of
this Agreement and/or this Clause 15.16, shall be resolved by arbitration in London
conducted in English by a single arbitrator pursuant to the rules of the International
Chamber of Commerce, save that, unless the Seller and the Purchaser agree otherwise,
the arbitrator shall draw up, and submit to them for signature, the Terms of Reference
within 21 days of receiving the file. The Terms of Reference shall not include a list of
issues to be determined.
[LCIA Clause]
Subject to Clause 8 (Post-Closing Adjustments), any dispute arising out of or
connected with this Agreement, including a dispute as to the validity or existence of
this Agreement and/or this Clause 15.16, shall be resolved by arbitration in [Seat]
conducted in [Language] by a single arbitrator pursuant to the rules of the London
Court of International Arbitration, [save that, unless the Seller and the Purchaser agree
otherwise, neither shall be required to give general discovery of documents, but may
be required only to produce specific, identified documents which are relevant to the
dispute].]
[UNCITRAL Clause]
Subject to Clause 8 (Post-Closing Adjustments), any dispute arising out of or
connected with this Agreement, including a dispute as to the validity or existence of
this Agreement and/or this Clause 15.16, shall be resolved by arbitration in [Seat]
conducted in [Language] by a single arbitrator pursuant to the rules of the United
Nations Commission on International Trade Law, save that, unless the Seller and the
Purchaser agree otherwise: (i) neither shall be required to give general discovery of
documents, but may be required only to produce specific, identified documents which
are relevant to the dispute; and (ii) the Seller and the Purchaser agree to waive any
right of appeal against the arbitration award.
The appointing body shall be the [International Chamber of Commerce] [the London
Court of International Arbitration].
14.17 Governing Law and Submission to Jurisdiction
14.17.1 This Agreement and the documents to be entered into pursuant to it, save as
expressly referred to therein, and any non-contractual obligations arising out of
or in connection with the Agreement and such documents shall be governed by
and construed in accordance with the English law.
14.17.2 [Either: [Where there is no arbitration] Each of the Seller and the Purchaser
irrevocably agrees that the courts of England are to have exclusive jurisdiction
to settle any dispute which may arise out of or in connection with this
Agreement [and the documents to be entered into pursuant to it] and that
accordingly any proceedings arising out of or in connection with this
Agreement [and the documents to be entered into pursuant to it] shall be
brought in such courts. [Each of the Seller and the Purchaser irrevocably
submits to the jurisdiction of such courts and waives any objection to
proceedings in any such court on the ground of venue or on the ground that
proceedings have been brought in an inconvenient forum.]
Or: [Where there is arbitration] Each of the Seller and the Purchaser irrevocably
submits to the non-exclusive jurisdiction of the courts of the [arbitration seat] to
support and assist the arbitration process pursuant to Clause 15.16, including if
necessary the grant of interlocutory relief pending the outcome of that process.
14.18 [Appointment of Process Agent
14.18.1 The Seller hereby irrevocably appoints [ ] of [ ] as
its agent to accept service of process in [ ] in any legal action or proceedings
arising out of this Agreement, service upon whom shall be deemed completed
whether or not forwarded to or received by the Seller.
14.18.2 The Seller agrees to inform the Purchaser in writing of any change of address of
such process agent within [14] days of such change.
14.18.3 If such process agent ceases to be able to act as such or to have an address in [
], the Seller irrevocably agrees to appoint a new process agent in [ ] acceptable
to the Purchaser and to deliver to the Purchaser within 14 days a copy of a
written acceptance of appointment by the process agent.
14.18.4 The Purchaser hereby irrevocably appoints [ ] of [ ]
as its agent to accept service of process in [ ] in any legal action or proceedings
arising out of this Agreement, service upon whom shall be deemed completed
whether or not forwarded to or received by the Purchaser .
14.18.5 The Purchaser agrees to inform the Seller in writing of any change of address of such
process agent within [28] days of such change.
14.18.6 If such process agent ceases to be able to act as such or to have an address in [ ], the
Purchaser irrevocably agrees to appoint a new process agent in [ ] acceptable to the
Seller and to deliver to the Seller within 14 days a copy of a written acceptance of
appointment by the process agent.
14.18.7 Nothing in this Agreement shall affect the right to serve process in any other manner
permitted by law [or the right to bring proceedings in any other jurisdiction for the
purposes of the enforcement or execution of any judgment or other settlement in any
other courts].]
In witness whereof this Agreement has been duly executed.


SIGNED by [ ]
on behalf of [insert name of
Seller]:

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