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Business Shares Agreement Template for Malaysia

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Key Requirements PROMPT example:

Business Shares Agreement

"I need a Business Shares Agreement for the sale of 40% shareholding in my Malaysian tech startup to a foreign investor, with completion planned for March 2025 and payment in two installments, including special provisions for board representation and technology transfer restrictions."

Document background
The Business Shares Agreement is a crucial document used in Malaysian corporate transactions when transferring ownership of company shares between parties. It is essential for various scenarios including business acquisitions, corporate restructuring, investment deals, and shareholder exits. The agreement must comply with Malaysian legislation, particularly the Companies Act 2016, and typically includes detailed provisions about the share transfer process, payment terms, warranties, and post-completion obligations. This document is fundamental in protecting both the seller's and buyer's interests while ensuring proper documentation of the ownership change for regulatory compliance. The complexity and importance of a Business Shares Agreement often necessitate careful drafting and review by legal professionals familiar with Malaysian corporate law.
Suggested Sections

1. Parties: Identification of all parties to the agreement, including full legal names, registration numbers, and registered addresses

2. Background: Context of the transaction, including company details, current shareholding structure, and purpose of the agreement

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules for interpreting the agreement

4. Sale and Purchase of Shares: Core transaction terms including number of shares, class of shares, and price per share

5. Consideration: Details of payment terms, method of payment, and any adjustments to the purchase price

6. Conditions Precedent: Conditions that must be satisfied before completion of the share transfer

7. Completion: Specific requirements and procedures for completing the share transfer, including timing and location

8. Warranties and Representations: Statements of fact and assurances given by both parties about their capacity and authority

9. Covenants: Ongoing obligations of the parties post-completion

10. Confidentiality: Obligations regarding confidential information and trade secrets

11. Governing Law and Jurisdiction: Specification of Malaysian law as governing law and jurisdiction for disputes

12. General Provisions: Standard boilerplate clauses including notices, amendments, and severability

Optional Sections

1. Tag-Along Rights: Optional provision giving minority shareholders the right to join in the sale of shares by majority shareholders

2. Drag-Along Rights: Optional provision allowing majority shareholders to force minority shareholders to join in the sale of shares

3. Non-Competition: Restrictions on competing business activities, included when selling shareholders might compete

4. Employee Matters: Included when the share transfer affects key employees or management

5. Intellectual Property Rights: Required when IP forms a significant part of the company's assets

6. Foreign Investment Compliance: Required when the transaction involves foreign investors

7. earn-out Provisions: Included when part of the purchase price is contingent on future performance

8. Pre-emptive Rights: Optional provisions regarding future share issues or transfers

Suggested Schedules

1. Share Details: Detailed description of shares being transferred, including share certificates numbers and shareholder information

2. Company Information: Detailed corporate information including assets, liabilities, and material contracts

3. Warranties: Comprehensive list of warranties given by the parties

4. Completion Checklist: List of documents and actions required for completion

5. Board Resolutions: Pro-forma board resolutions required for the share transfer

6. Related Party Transactions: List of all related party transactions and ongoing arrangements

7. Encumbrances: Details of any existing encumbrances on the shares or company assets

8. Required Consents: List of third-party consents required for the transaction

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions


































Clauses



































Relevant Industries

Financial Services

Manufacturing

Technology

Real Estate

Retail

Professional Services

Healthcare

Education

Energy

Transportation

Agriculture

Construction

Telecommunications

Mining

Hospitality

Relevant Teams

Legal

Finance

Corporate Affairs

Compliance

Risk Management

Corporate Strategy

Investment

Mergers & Acquisitions

Business Development

Board Secretariat

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Corporate Lawyer

Legal Counsel

Company Secretary

Investment Manager

Corporate Finance Manager

Mergers & Acquisitions Director

Business Development Manager

Risk Manager

Compliance Officer

Board Director

Managing Director

Finance Director

Corporate Strategy Manager

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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