Stock Purchase Agreement Guarantees

However, in practice, such a claim is possible if the buyer receives specific guarantees that are as precise as possible and that reflect the nature of the activities of the acquired company and the information received by the buyer during the transaction process, including during interviews with the seller and due diligence (if carried out). Therefore, such safeguards should, depending on the situation, address general issues (e.g. B correct accounting, compliance with deadlines for payment of taxes and tax returns), but also more specific issues concerning the correct tax treatment of sensitive transactions (e.g. .B. the correct application of reduced VAT rates, withholding tax), the establishment of complete transfer pricing documentation or the maintenance of all documents, necessary to claim the 0% rate in case of export. Intra-Community transactions or supplies of goods. Below we look at the general warranties and what they mean for a buyer under a share sale agreement. 4.15. Contracts. The company has complied, in all substantive references, with all the conditions of the essential contracts in which it participates and has not carried out or performed an act that would invalidate or affect its rights under an essential contract. . .

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