A share purchase agreement (SPA) is a crucial legal document that is vital in the purchase of shares in Malaysia. This document sets out the terms and conditions of the transaction between the seller and buyer of the shares.
In Malaysia, share purchase agreements are governed under the Companies Act 2016 and the Securities Commission’s Guidelines on Takeovers, Mergers, and Compulsory Acquisitions.
There are several key provisions that should be included in a share purchase agreement in Malaysia. These include the purchase price of the shares, the payment terms, and the representations and warranties made by both parties. The SPA should also outline the post-completion obligations of both parties, including any covenants and indemnification clauses.
One of the critical aspects of a share purchase agreement in Malaysia is dealing with regulatory compliance and obtaining necessary approvals. The agreement should include provisions relating to obtaining regulatory approvals, including approval from the Securities Commission of Malaysia and the relevant stock exchange.
Another crucial aspect of a share purchase agreement is the dispute resolution mechanism. The SPA should specify the jurisdiction of any disputes that may arise between the parties and the means of dispute resolution. This could include arbitration, mediation, or litigation.
In conclusion, a well-drafted share purchase agreement is crucial to ensure a smooth and efficient share transfer transaction in Malaysia. It is essential to engage an experienced lawyer who can advise on the specific requirements in Malaysia and ensure that all legal and regulatory requirements are met. By carefully drafting the SPA, both parties can have a clear understanding of their rights and obligations, ensuring a successful transaction.