Overview
A Share Purchase Agreement, commonly known as an SPA, is a legally binding contract between a buyer and a seller for the purchase and sale of shares of a company. In India, SPAs are widely used in private equity transactions, startup investments, mergers and acquisitions, and transfer of ownership among shareholders. The agreement records the terms under which shares are transferred and ensures transparency and legal protection for both parties.
The Share Purchase Agreement specifies essential details such as the number of shares being transferred, purchase price, payment terms, and completion date. It also includes representations and warranties by the seller regarding ownership, compliance, and financial status of the company. Conditions precedent, indemnity clauses, and confidentiality obligations are also key components of the agreement, helping manage risks associated with share transfers.
SPAs are particularly important in private limited companies where transfer of shares is regulated by the Companies Act, 2013 and the Articles of Association of the company. The agreement ensures that statutory compliances such as board approvals, share transfer forms, and updates to company records are completed correctly. Without a properly drafted SPA, share transfers can lead to disputes or regulatory non-compliance.
At BizGlobal, we assist investors, founders, and companies in drafting clear and comprehensive Share Purchase Agreements tailored to the transaction structure. From legal due diligence support to drafting and execution guidance, our team ensures that the share transfer process is smooth, compliant, and legally secure.
