THIS AGREEMENT is made the day of ….
BETWEEN
1 [insert company name] (NRIC NO: …) of ………..
2…. (NRIC NO: …)., of ………
3…. (NRIC NO: … of ………..
4………. (NRIC NO: ….of ……..
5………. (NRIC NO: …) Of …….
6………. (NRIC NO: ….) of [insert address]
(unless otherwise specifically mentioned the said parties shall be collectively referred to as “the Shareholders”) of the first part
AND
…………, a company incorporated in Malaysia and having its registered office at ………(hereinafter referred to as “the Purchaser”) of the other part.
WHEREAS:-
1……….. (hereinafter referred to as “the Company”) is a plant and process engineering services specialist company and has as its principal business activities the turnkey project implementation of plant and process engineering services, construction and installation of LPG & Natural Gas metering and regulating stations, construction of industrial packages for system design, fabrication, installation and commissioning of plants, equipment, pipelines and other engineering services, maintenance, replacement, and overhaul of plants, equipment, pipelines, and other engineering sevices, trading and supply of plant and process equipment and materials.
2.The Company is a private company limited by shares incorporated in Malaysia under the Companies Act 1965, having an authorised capital of Malaysian Ringgit …… (RM…..) only divided into .. (…) ordinary shares of Malaysian Ringgit One (RM1.00) only per share of which … (…) ordinary shares have been issued and fully paid or credited as fully paid (hereinafter called “the Issued Shares”).
3.The Shareholders are the legal and beneficial owners of all the Issued Shares of the Company in the proportion more particularly described in the First Schedule annexed hereto.
4.The Shareholders have agreed to sell and the Purchaser has agreed to purchase…. percentum (…%) of the Issued Shares (details of which are more particularly described in the Second Schedule annexed hereto which …% of the Issued Shares shall be referred to as “the Sale Shares”) at Malaysian Ringgit …………(RM……..) upon the terms and conditions hereinafter appearing.
NOW IT IS HEREBY AGREED as follows:-
SECTION 1 – SALE AND PURCHASE
In consideration of the sum of Malaysian Ringgit ……… (RM………) only (hereinafter referred to as “the Purchase Price”) to be settled in a manner provided in Section 2 hereof, the Shareholders shall sell and the Purchaser shall purchase the Sale Shares free from all charges or liens or other encumbrances and with all rights attaching thereto including all rights to dividends and other distribution declared made and paid hereafter.
SECTION 2 – CONSIDERATION
2.1 The total consideration payable to the Shareholders for the Sale Shares shall be the sum of Malaysian Ringgit………………. (RM…………) only to be satisfied as follows:
(a) The Purchaser shall upon the execution of this agreement pay to messrs ……… (hereinafter referred to as the “Shareholders’ Solicitors”) a sum of Malaysian Ringgit ………………. (MR…….) only as deposit and part payment of Purchase Price.
(b) The balance of the Purchase Price less the deposit and part payment referred to in Section 2.1 (a) above shall be paid to the Shareholders’ Solicitors on the Completion Date as hereinafter defined in Section 3 below.
2.2 The Shareholders shall within seven (7) days upon the execution of this Agreement and the receipt by the Shareholders’ Solicitors of the sum mentioned in Section 2.1(a) above, deposit with the Shareholders’ Solicitors as Stakeholders the Certificates to the Sale Shares together with valid and registrable transfers thereof duly executed by the Shareholders in favour of the Purchaser.
SECTION 3 – COMPLETION
3.1 Completion of the Sale and Purchase of the Sale Shares shall take place at the office of the Purchaser on a date occurring on or before the expiry of the period of one (1) year from the date of this agreement (which date shall hereinafter be referred to as “the Completion Date”) whereupon the Purchaser shall deliver to the Shareholders’ Solicitors the balance of the Purchase Price.
3.2 In the event that the Purchaser fails to pay the Balance Purchase Price on the Completion date, the Shareholders shall grant the Purchaser a further period of thirty (30) days to settle the balance Purchase Price SUBJECT ALWAYS that the Purchaser pays interest at the rate of ten percent (10%) per annum calculated on a daily rest basis from the Completion Date until the date of full settlement of the Purchase Price by the Purchaser.
3.3 In the event that the Purchaser shall fail and or neglect to satisfy the Purchase Price in accordance with Section 3.1 or Section 3.2 hereof, the Shareholders shall be entitled to forthwith terminate this agreement by notice in writing to the Purchaser and shall be entitled to forfeit the deposit paid under Section 2.1 (a) above as agreed liquidated damages and the Purchaser shall re-transfer the said Sale Shares back to the Shareholders at the Purchasers’s cost and expense and thereafter this agreement shall terminate and be of no effect and no party shall have any claims against the other. Alternatively in lieu of termination, the Shareholders may elect to sue for specific performance of this agreement and all costs, expenses and losses incurred thereby.
3.4 In the event the Purchaser have complied with their obligations herein but the Shareholders wilfully fail to complete the sale of the Sale Shares in accordance of the terms and conditions herein contained, the Purchaser shall be entitled to sue for specific performance of this agreement in which event the Shareholders shall be liable for costs on a solicitor-client basis.
SECTION 4 – TRANSFER OF THE SALE SHARES
4.1 Upon the execution of this agreement the Shareholders shall deliver to the Purchaser:-
(i) the original certificates to the said Shares together with valid and registrable transfers thereof duly executed by the Shareholders in favour of the Purchaser or its nominee;
(ii) the original board resolution passed in accordance with the Memorandum and Articles of Association of the Company to approve the transfer of the Sale Shares from the Shareholders to the Purchaser and/or its nominee or nominees; and the appointment with immediate effect of such persons as may be nominated by the Purchaser to be new directors of the Company;
4.2 Subject to the provisions of Section 3.3 above the Purchaser shall be entitled have the Sale Shares registered in their names upon the signing of this agreement and shall be entitled to all rights title and interest of the Shareholders in its capacity as shareholder and/or director of the Company and/or as holder of the Shareholders’ shares.The Purchaser hereby agrees that it shall indemnify and keep the Shareholders indemnified and save harmless of all debts, charges, expenses however arising out of the Sale Shares pending the settlement of the balance Purchase Price.
SECTION 5 – PASSING OF RESOLUTIONS
5.1 Forthwith upon the execution of this Agreement, the Purchaser and the Shareholders shall ensure that their respective Boards of Directors shall take all such steps and action as shall be requisite to give effect to the provisions of this Agreement.
5.2 The Shareholders shall procure the Board of Directors of the Company to approve the Sale and subsequent transfer of the Sale Shares in favour of the Purchaser.
SECTION 6 – PRE-EMPTION RIGHTS
The Shareholders hereby agree that for the purpose of this agreement they shall waive any or all pre-emption rights whatsoever that they as Shareholders may have in relation to any of the said Shares of the Company under the Articles and Association of the Company or otherwise.
SECTION 7 – SPECIFIC PERFORMANCE
In the event that the Purchaser shall have complied with all the terms and conditions herein contained but the Shareholders have failed to comply with their duties and obligations hereunder for any reason whatsoever the Purchaser shall be entitled to specific performance against the Shareholders and all costs and expenses incurred in connection therewith (including Solicitor’s cost on a solicitor and client basis) shall be borne by the Shareholders or to accept the repudiation of this Agreement by the Shareholders and claim all losses damages and expenses (including legal costs on a solicitor-client basis) arising out of such repudiation.
SECTION 8 – TIME
Time whenever mentioned shall be of the essence of this Agreement.
SECTION 9 – FURTHER DEED AND ACTS
The parties hereto shall execute and do and procure all execute and do all such further deeds, assurance, acts and things as may be reasonably required so that full effect may be given to the terms and conditions of this Agreement.
SECTION 10 – INTERPRETATION
In this Agreement unless there be something in the subject or content inconsistent herewith, words importing the singular or the masculine gender only include the plural number or feminine gender and words importing persons include corporation and the expression “the Shareholders” and “the Purchaser” includes their respective successor-in-title.
SECTION 11 – NOTICE
Unless otherwise specified herein all notices request or other communication to or upon any of the parties hereto shall be in writing and shall be deemed to have been given in the case of notice by letter three (3) days of notice by cable one (1) day after the cable was despatched, or, in the case of notice by tele-facsimile immediately after transmission thereof and all such notices request or other communication shall be delivered to the address of the parties hereto hereinbefore mentioned or to their solicitors or to such other address as any of the parties hereto may designate from time to time by written notice to the other parties hereto.
SECTION 12 – CONFIDENTIAL INFORMATION
The parties hereto acknowledge that in consequence of the transactions hereby contemplated and in the course of negotiations leading to the finalisation of this Agreement, each of them has received confidential information relating to each other. The parties hereto hereby covenant and undertake with each other that unless compelled by law or except with the prior written consent of the other or for the purpose of enforcing their rights herein, neither of them will disclose use or otherwise exploit such information for any purpose whatsoever and will at all times keep all such information in complete confidence. This provision shall survive the termination of this Agreement for any reason whatsoever.
SECTION 13 – APPLICABLE LAW
This Agreement shall for all purposes be governed by and construed in accordance with the laws of Malaysia and the parties hereto hereby agree to submit to the jurisdiction of the Courts of Malaysia.
SECTION 14 – COSTS
The stamp fees for the transfer and registration of the Sale Shares shall be borne and paid by the Purchaser. Each party shall pay its own Solicitor’s costs in respect of this agreement PROVIDED THAT in the event of any action or proceeding being taken by any party to enforce its rights herein, the party found to be in default shall indemnify the non-defaulting party against all such costs so incurred including legal costs on a solicitor-client basis.
SECTION 15 – GENERAL PROVISIONS
15.1 In the event of any conflict between the provisions of the Memorandum and Articles of Association of the Company and the provisions of this Agreement, the provisions of this Agreement shall prevail.
15.2 Without prejudice to Section 15.1 hereof, the parties may at any time if thought desirable, agree to amend the Articles of Association of the Company by incorporating any of the provisions of this Agreement or amending or adding any new Articles so as to reflect the intent and spirit of this Agreement.
15.3 The parties hereto agree that the invalidity or unenforceability of any provision in this Agreement shall not affect the validity of the rest of this Agreement. As far as may be legally possible in lieu of such invalid or unenforceable provision there shall be implied or added automatically as part hereof a provision that is as similar in terms to such invalid or unenforceable provision that is legal valid and enforceable so as to give effect to the intent of the parties hereto.
15.4 The Purchaser hereby represents and warrants to the Shareholders that it shall use its best endeavours to secure work and contracts for the Company. The Purchaser acknowledges that any agreement by the Shareholders to sell the Sale Shares to the Purchaser is on such reliance on such representation and warranty. The Purchaser further covenant and undertake that none of the companies which are related or associated with the Purchaser or any company in which any of its directors are directly or indirectly interested will compete with the Company in respect of any works/contracts which may be secured by the Purchaser for the Company or are undertaken by the Company.
SECTION 16 – SUCCESSORS’ BOUND
This Agreement shall be binding upon the parties hereto and their respective successors-in-title and permitted assigns.
IN WITNESS WHEREOF the parties have hereunto set their hands the day and year first above written.
SIGNED by the said ………………. )
in the presence of:- )
SIGNED by the said ………. )
in the presence of :- )
SIGNED by the said ……. )
in the presence of:- )
SIGNED by the said ……….)
in the presence of:- )
Signed by the said ……… )
in the presence of:- )
Signed by the said ………..)
in the presence of:- )
The Common Seal of )
……………. )
is affixed hereto )
in the presence of:- )
……………………. …………………..
Director Director/Secretary
F I R S T S C H E D U L E
THE FIRST SCHEDULE REFERRED TO IN RECITAL 2
Name of No of Shares Percentage
Share- held of
holders Shareholding
——- ———– ————
————— ————–
100%
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S E C O N D S C H E D U L E
THE SECOND SCHEDULE REFERRED TO IN RECITAL 4
Name of No of Shares Price
Shareholders to be sold
———— ———– ————–
———- ————
Total …….. …………
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SALE OF SHARES AGREEMENT
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Between
……………………..
AND
………………………
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DATED THIS DAY OF ………
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