Conditions precedent
Suspensive conditions that must be satisfied between signing and closing before the transaction is completed.
Conditions precedent (CPs) are requirements set out in the share purchase agreement that must occur during the interim period between signing and closing. Typical CPs are merger-control clearances, consents triggered by change-of-control clauses, financing commitments or the granting of security.
Only once all conditions are satisfied or effectively waived does the obligation to complete arise. If CPs remain open until the agreed long stop date, the contract can be unwound. The parties also allocate which party is responsible for satisfying each condition (best efforts).
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This explanation gives a general overview of Austrian law and does not replace advice in an individual case. The specific circumstances of your transaction are always decisive.
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Signing
The execution of the share purchase agreement, by which the parties become contractually bound; the transfer itself follows at closing.
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Closing
The completion of the transaction at which, once all conditions are satisfied, the shares are transferred and the purchase price is paid.
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Change of control
A contract clause granting a contracting party special rights (such as termination or consent) on a change of control in the other company.
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Share purchase agreement (SPA)
The central agreement governing the acquisition of a business (share or asset deal), covering the object of sale, purchase price, warranties and completion.
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