Who Prepares the Share Purchase Agreement

When it comes to buying or selling a company, a share purchase agreement (SPA) is a critical document that outlines the terms and conditions of the transaction. It is a legally binding agreement that sets out the parties involved, the purchase price, the number of shares being sold, and any other relevant details.

But who prepares the share purchase agreement? The answer is that it depends on the specific circumstances of the transaction.

In some cases, the buyer`s legal team will prepare the SPA. This is often the case when the buyer is larger and has more resources available to them. The buyer`s legal team will typically draft the agreement and present it to the seller`s legal team for review and negotiation.

Alternatively, the seller`s legal team may prepare the SPA. This is more common when the seller is a smaller company without a dedicated legal department. In this scenario, the seller`s legal team will draft the agreement and present it to the buyer`s legal team for review and negotiation.

In some cases, both parties may work together to prepare the SPA. This is particularly common when the transaction is more complex and involves multiple parties. Both sides will typically work together to draft the agreement and negotiate the terms.

Regardless of who prepares the SPA, it`s essential to ensure that it is comprehensive and includes all the necessary details. This includes the purchase price, the number of shares being sold, any warranties or representations, and any conditions that must be met before the transaction can be completed.

In addition, it`s critical to ensure that the SPA is legally enforceable and complies with all relevant laws and regulations. This is why it`s essential to have experienced legal professionals involved in the preparation of the SPA.

In conclusion, who prepares the share purchase agreement depends on the specific circumstances of the transaction. It can be prepared by the buyer`s legal team, the seller`s legal team, or both parties working together. Regardless of who prepares it, it`s essential to ensure that the SPA is comprehensive, legally enforceable, and complies with all relevant laws and regulations.