Business sale legal templates

These high quality legal templates from our precedent library are intended to help you at the initial stages of a business sale.

The templates are:

  • free

  • downloadable without registration

  • in Word format

  • to be edited before use and contain suggestions to help you complete them

  • regularly updated to keep pace with changes in commercial law and practice​.

Please do ask us to quote to:
 

  • review any agreement that you have produced to check that it is suitable for your needs and provides you with the required legal protections

  • progress your transaction further.

We can help, please call 020 3871 8442, email info@crestlegal.com or complete a free online enquiry

PLEASE NOTE

 

You will need to edit these templates before use. As well as generally editing the body of the document to tailor it for your needs, you should note that:

 

  • square brackets indicate areas that require specific editorial attention 

  • yellow highlights indicate factual details that need to be completed

  • "ORs" indicate alternative provisions. 

 

By the end of the editing process, there should be no square brackets nor yellow highlights left in the body of the document, and only one alternative from each set of alternatives should remain. 

 

If you have any doubts about the editing or use of these templates, you should seek professional legal advice.

Heads of terms

These heads of terms (also known as a memorandum of understanding or letter of intent) are entered into between the seller of the shares in a private company and the prospective buyer. 

Heads of terms are signed at the beginning of the transaction (before the parties begin to incur significant transaction costs) to:

 

  • outline the main terms of the proposed deal

  • provide a structured basis for negotiating definitive documents.

 

These heads of terms have been prepared on the assumptions that:

 

  • The target company is private company limited by shares registered in England and Wales.

  • The transaction involves a single corporate seller and a single corporate buyer.

  • Both the seller and the buyer are private companies registered in England and Wales.

  • The heads of terms are not intended to be legally binding as a whole, although certain provisions will be binding (such as the exclusivity, confidentiality, costs and governing law provisions).

  • The parties have already entered into a confidentiality agreement relating to the proposed transaction.

Confidentiality agreement

This confidentiality agreement (also known as a non-disclosure agreement or NDA) can be used where the seller of the shares in  a private company is disclosing confidential information to the prospective buyer. 

Confidentiality agreements aim to ensure:

 

  • confidential information disclosed by the seller remains confidential 

  • the buyer will only use the information for due diligence purposes as regards the share sale.

 

Limitations of confidentiality agreements: The seller should note that a confidentiality agreement cannot provide absolute protection. If the buyer uses or discloses confidential information in breach of the agreement, it may be too late or expensive, for the seller to seek a remedy:

 

  • An injunction (to stop any unauthorised disclosure or use of the information) is the first choice of remedy if the seller discovers the buyer’s intentions before it breaches the confidentiality agreement. After the breach, however, there is no legal remedy that will make confidential information secret again. 

  • Damages for breach of contract, or a claim for an account of profits where the buyer has made use of the information, may not be an adequate remedy, particularly if the confidential information has potential future value.

  • Proving a breach of confidentiality is often difficult.

  • Even where the buyer is acting in good faith, it will inevitably be influenced by the disclosed confidential information.

 

Given these limitations, the seller should also put in practical measures to protect the information. The seller should, for example, disclose only what is absolutely necessary, provide hard copies of information only, or limit the number of individuals who may receive the information.

 

The confidentiality agreement has been prepared on the following assumptions:

 

  • The target company is private company limited by shares registered in England and Wales.

  • The transaction involves a single corporate seller and a single corporate buyer.

  • Both the seller and the buyer are private companies registered in England and Wales.

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Crest Legal is the trading name for Crest Legal Limited. Crest Legal Limited is registered in England and Wales with company number 11078493, with its registered office at 86-90 Paul Street, London EC2A 4NE. Crest Legal Limited is a firm of solicitors which is authorised and regulated by the Solicitors Regulation Authority with SRA number 645425. 

 

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