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Common Stock Repurchase Agreement for the United Kingdom

Common Stock Repurchase Agreement Template for England and Wales

A Common Stock Repurchase Agreement is a legal document governed by English and Welsh law that formalizes the process by which a company buys back its own shares from existing shareholders. The agreement sets out the terms and conditions of the repurchase, including the purchase price, number of shares, completion mechanics, and any warranties given by the selling shareholders. It ensures compliance with the Companies Act 2006 and other relevant legislation while protecting both the company's and shareholders' interests.

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Common Stock Repurchase Agreement

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What is a Common Stock Repurchase Agreement?

The Common Stock Repurchase Agreement is utilized when a company wishes to reduce its share capital, manage its equity structure, or facilitate shareholder exits. This document, governed by English and Welsh law, is essential for ensuring compliance with the Companies Act 2006 and maintaining proper corporate governance. It typically includes detailed provisions on purchase price, completion mechanics, warranties, and tax considerations. The agreement is particularly important for private companies managing ownership transitions and public companies implementing share buyback programs.

What sections should be included in a Common Stock Repurchase Agreement?

1. Parties: Identification of the company and selling shareholders

2. Background: Context of the repurchase and current shareholding structure

3. Definitions: Key terms used throughout the agreement including share class, purchase price, and completion date

4. Sale and Purchase: Core terms of the repurchase including number of shares and price

5. Completion: Mechanics and timing of the repurchase including payment terms

6. Warranties: Standard representations about share ownership and authority to sell

7. Governing Law and Jurisdiction: Specification of English and Welsh law as governing law and jurisdiction

What sections are optional to include in a Common Stock Repurchase Agreement?

1. Conditions Precedent: Required when completion is subject to specific conditions such as regulatory approval or shareholder consent

2. Tax Provisions: Specific tax-related obligations and allocations between parties

3. Restrictive Covenants: Restrictions on seller's future activities and competition provisions

4. Confidentiality: Provisions regarding the confidential treatment of the transaction and related information

What schedules should be included in a Common Stock Repurchase Agreement?

1. Schedule 1: Details of Shares: Detailed description of shares being repurchased including share certificates and class rights

2. Schedule 2: Completion Requirements: List of documents and actions required at completion including forms and corporate approvals

3. Schedule 3: Warranties: Detailed warranties given by the selling shareholders regarding ownership and authority

4. Schedule 4: Board Minutes: Pro-forma board minutes approving the repurchase and related corporate authorizations

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 | Serial Founder & Legal AI Author

Jurisdiction

England and Wales

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions

























Clauses

























Industries

Companies Act 2006 - Share Capital Provisions: Sections 658-737 covering share capital reduction and buybacks; Sections 690-708 specifically on share repurchases; Requirements for shareholder approval; Financial assistance restrictions

Financial Services and Markets Act 2000: Core financial services legislation covering regulations on market manipulation, disclosure requirements, and financial promotion rules

Listing Rules and Disclosure Guidance: Requirements for listed companies including market abuse regulations and disclosure obligations (applicable if company is listed)

Corporate Governance Code: Best practices for share repurchases and board responsibilities (if applicable to the company size/status)

Market Abuse Regulation (MAR): Regulations covering inside information, trading restrictions, and disclosure requirements for market-sensitive transactions

Tax Legislation: Corporation Tax Act 2010, Income Tax Act 2007, and considerations for Stamp Duty implications on share repurchases

Articles of Association: Company's constitutional document containing specific provisions and restrictions regarding share repurchases

Contract Law Principles: Common law principles governing contract formation, consideration requirements, and capacity to contract under English law

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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