Looking for stock purchase agreement
November 03, 2022
by a professional in Nashville, TN, USA
Hi Searchfunder community,
Does anyone have a stock purchase agreement template they'd be willing to share? Or know of a source where I can acquire one? I am happy to trade a version I have, which is thorough by lengthy.
Thanks in advance!
in Nashville, TN, USA
We are pursuing a stock purchase because there are hundreds of customer contracts and thousands of worker agreements that would be difficult to transfer if we executed an asset deal. We understand the additional risk that comes with a stock purchase and that an SPA is typically longer than an APA document.
Here is the table of contents we are using in case you see unnecessary, duplicative, or excessively long sections. For example, the IP section can be deleted since the target has no IP. Happy to share the the full document or sections as is helpful.
ARTICLE I DEFINITIONS 2
ARTICLE II PURCHASE AND SALE 9
Section 2.01 Purchase and Sale. 9
Section 2.02 Purchase Price. 9
Section 2.03 Transactions to be Effected at the Closing. 9
Section 2.03 Transactions to be Effected at the Closing. 12
Section 2.04 Purchase Price Adjustment. 13
Section 2.05 Closing. 16
Section 2.06 Withholding Tax. 16
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER 18
Section 3.01 Organization and Authority of Seller. 18
Section 3.02 Organization, Authority and Qualification of the Company. 18
Section 3.03 Capitalization. 18
Section 3.04 No Subsidiaries. 19
Section 3.05 No Conflicts; Consents. 19
Section 3.06 Financial Statements. 20
Section 3.07 Undisclosed Liabilities. 20
Section 3.08 Absence of Certain Changes, Events and Conditions. 21
Section 3.09 Material Contracts. 23
Section 3.10 Title to Assets; Real Property. 24
Section 3.11 Condition [And Sufficiency] of Assets. 25
Section 3.12 Intellectual Property. 25
Section###-###-#### Accounts Receivable. 27
Section###-###-#### Customers and Suppliers. 27
Section 3.16 Insurance. 28
Section 3.17 Legal Proceedings; Governmental Orders. 28
Section 3.18 Compliance With Laws; Permits. 29
Section 3.19 Environmental Matters. 29
Section 3.20 Employee Benefit Matters. 31
Section 3.21 Employment Matters. 34
Section 3.22 Taxes. 35
Section 3.23 Books and Records. 37
Section 3.24 Brokers. 37
Section###-###-#### Full Disclosure. 37
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER 37
Section 4.01 Organization and Authority of Buyer. 37
Section 4.02 No Conflicts; Consents. 38
Section 4.03 Investment Purpose. 38
Section 4.04 Brokers. 38
Section 4.05 Sufficiency of Funds. 39
Section 4.06 Legal Proceedings. 39
ARTICLE V COVENANTS 39
Section 5.01 Conduct of Business Prior to the Closing. 39
Section 5.02 Access to Information. 40
Section 5.03 No Solicitation of Other Bids. 40
Section 5.04 Notice of Certain Events. 40
Section 5.05 Resignations. 41 Section 5.06 Confidentiality. 41
Section 5.07 Non-competition; Non-solicitation 42
Section 5.08 Governmental Approvals and Consents 43
Section 5.09 Books and Records. 44
Section 5.10 Closing Conditions 45
Section 5.11 Public Announcements. 45
Section 5.12 Further Assurances. 45
ARTICLE VI TAX MATTERS 45
Section 6.01 Tax Covenants. 45
Section 6.02 Termination of Existing Tax Sharing Agreements. 46
Section 6.03 Tax Indemnification. 46
Section 6.04 Straddle Period. 47
Section 6.06 Contests. 47
Section 6.07 Cooperation and Exchange of Information. 47
Section 6.08 Tax Treatment of Indemnification Payments. 48
Section 6.09 Survival. 48
Section 6.10 Overlap. 48
ARTICLE VII CONDITIONS TO CLOSING 48
Section 7.01 Conditions to Obligations of All Parties. 48
Section 7.02 Conditions to Obligations of Buyer. 49
Section 7.03 Conditions to Obligations of Seller. 50
ARTICLE VIII INDEMNIFICATION 51 Section 8.01 Survival. 51
Section 8.02 Indemnification By Seller. 52
Section 8.03 Indemnification By Buyer. 53
Section 8.04 Certain Limitations. 53
Section 8.05 Indemnification Procedures. 54
Section 8.06 Payments. 56
Section 8.07 Tax Treatment of Indemnification Payments. 57
Section 8.08 Effect of Investigation. 57
Section 8.09 Exclusive Remedies. 57
ARTICLE IX TERMINATION 58
Section 9.01 Termination. 58
Section 9.02 Effect of Termination. 58
ARTICLE X MISCELLANEOUS 59
Section###-###-#### Expenses. 59
Section###-###-#### Notices. 59
Section###-###-#### Interpretation. 60
Section###-###-#### Headings. 60
Section###-###-#### Severability. 60
Section###-###-#### Entire Agreement. 60
Section###-###-#### Successors and Assigns. 61
Section###-###-#### No Third-party Beneficiaries. 61
Section###-###-#### Amendment and Modification; Waiver. 61
Section###-###-#### Governing Law; Submission to Jurisdiction; Waiver of Jury Trial. 61
Section###-###-#### Specific Performance. 62
Section###-###-#### Counterparts. 62
from University of Pennsylvania in Charlotte, NC, USA
I agree with the spirit of Mike's comment that if you decide to trim anything, it should be dependent on the nature of the business and your comfort from due diligence, not on anyone else's SPA or a template. In Deal A, there's a good reason that is has a double materiality scrape, but in Deal B there's a good reason that provision is absent. And that affects the indemnity escrow terms. Etc. I'd caution against using EDGAR since those are mostly public company deals which is often a different animal with regard to what makes sense in an SPA.