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Assignment Of Shares Agreement Template for Canada

A comprehensive legal document governed by Canadian law that facilitates and formalizes the transfer of shares from one party (the Assignor) to another (the Assignee). This agreement details the terms and conditions of the share transfer, including the number and class of shares, consideration paid, representations and warranties, and completion requirements. It ensures compliance with both federal and provincial regulations, including the Canada Business Corporations Act or relevant provincial corporate legislation, and addresses necessary corporate and securities law requirements for valid share transfers.

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What is a Assignment Of Shares Agreement?

The Assignment Of Shares Agreement is a crucial legal instrument used in Canadian business transactions when transferring ownership of shares from one party to another. This document is essential for both private and public companies operating under Canadian federal or provincial jurisdiction, ensuring compliance with relevant corporate and securities laws. It becomes necessary when shareholders wish to sell or transfer their shares, during corporate restructuring, in merger and acquisition transactions, or for estate planning purposes. The agreement typically includes detailed information about the shares being transferred, purchase price, payment terms, representations and warranties, and any conditions precedent to the transfer. It must comply with the requirements of the Canada Business Corporations Act or provincial equivalents, and may also need to address requirements under securities regulations, tax laws, and any existing shareholder agreements.

What sections should be included in a Assignment Of Shares Agreement?

1. Parties: Identifies and defines the Assignor (current shareholder), Assignee (new shareholder), and the Corporation whose shares are being transferred

2. Background: Recitals explaining the context of the share transfer, including current ownership and reason for transfer

3. Definitions: Defines key terms used throughout the agreement

4. Assignment and Transfer: Core provision detailing the transfer of shares from Assignor to Assignee

5. Consideration: Specifies the purchase price or other consideration for the shares

6. Completion: Details of when and how the transfer will be completed, including delivery of share certificates and payment

7. Representations and Warranties of Assignor: Assignor's confirmations regarding ownership, authority to sell, and status of shares

8. Representations and Warranties of Assignee: Assignee's confirmations regarding authority to purchase and compliance with corporate requirements

9. Further Assurances: Commitment to execute additional documents and take necessary actions to effect the transfer

10. Governing Law: Specifies the Canadian jurisdiction governing the agreement

11. Execution: Signature blocks and execution requirements

What sections are optional to include in a Assignment Of Shares Agreement?

1. Third Party Consents: Required when the share transfer needs approval from other shareholders, the board, or regulatory bodies

2. Tax Matters: Include when specific tax treatment or obligations need to be addressed

3. Non-Competition: Add when the Assignor needs to be restricted from competing post-transfer

4. Confidentiality: Include when parties need to maintain confidentiality about the transaction or company information

5. Survival of Representations: Add when certain representations need to survive completion of the transfer

6. Payment Terms: Include when payment is not made in full at completion

7. Security Interest: Required when shares are being used as security or subject to liens

8. Regulatory Compliance: Add when transfer requires specific regulatory compliance or approvals

What schedules should be included in a Assignment Of Shares Agreement?

1. Schedule A - Share Details: Details of shares being transferred including class, number, and distinctive numbers

2. Schedule B - Share Certificate(s): Copies of relevant share certificates

3. Schedule C - Corporate Resolution: Board and/or shareholder resolutions approving the transfer

4. Schedule D - Consent Documents: Any required third-party or regulatory consent documents

5. Schedule E - Payment Terms: If applicable, detailed payment schedule and terms

6. Appendix 1 - Transfer Form: Standard form for share transfer required by the corporation

7. Appendix 2 - Tax Declarations: Any required tax forms or declarations related to the transfer

Authors

Alex Denne

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

Jurisdiction

Canada

Publisher

Genie AI

Document Type

Stock Agreement

Cost

Free to use

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