Takeover agreement format

 

TAKEOVER AGREEMENT
(Between a Proprietorship Firm and a Private Limited Company)

This Takeover Agreement ("Agreement") is made and entered into on this ___ day of __, 20, by and between:

1. [Name of Proprietor], an individual conducting business under the name [Name of Proprietorship Firm], having its principal place of business at [Address], hereinafter referred to as the "Proprietor" (which expression shall, unless repugnant to the context, include his/her heirs, legal representatives, successors, and assigns);

AND

2. [Name of Private Limited Company], a company incorporated under the Companies Act, 2013, having its registered office at [Address], hereinafter referred to as the "Company" (which expression shall, unless repugnant to the context, include its successors and assigns).

WHEREAS:

A. The Proprietor is the sole owner of the Proprietorship Firm engaged in the business of [Nature of Business] and has agreed to transfer all its assets, liabilities, rights, and obligations to the Company. B. The Company desires to acquire and continue the business of the Proprietorship Firm as a going concern under the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties agree as follows:

1. TAKEOVER OF BUSINESS

1.1 The Proprietor hereby agrees to transfer, assign, and vest in the Company, and the Company agrees to acquire, the entire business of the Proprietorship Firm as a going concern. 1.2 The takeover shall include all tangible and intangible assets, goodwill, intellectual property, contracts, licenses, trade receivables, bank accounts, inventories, and liabilities of the Proprietorship Firm.

2. CONSIDERATION

2.1 The total consideration for the transfer shall be INR [Amount], payable by the Company to the Proprietor in cash/equity shares/other mutually agreed terms. 2.2 The Proprietor shall execute all necessary documents to effectuate the transfer and issue a No Objection Certificate (NOC) in favor of the Company.

3. TRANSFER OF EMPLOYEES

3.1 The Company shall have the right to retain existing employees of the Proprietorship Firm under terms mutually agreed upon. 3.2 The Proprietor shall ensure that all statutory dues, including provident fund, gratuity, and salary payments, are cleared up to the date of takeover.

4. TRANSFER OF LIABILITIES

4.1 The Company shall assume all disclosed liabilities of the Proprietorship Firm from the effective date of takeover. 4.2 Any undisclosed or contingent liabilities arising from acts or omissions before the takeover shall remain the sole responsibility of the Proprietor.

5. REPRESENTATIONS AND WARRANTIES

5.1 The Proprietor represents and warrants that:

• The Proprietorship Firm is free from any legal encumbrances or undisclosed liabilities.
• All licenses and approvals necessary for the business are valid and in good standing. 5.2 The Company represents and warrants that:
• It has the authority to enter into this Agreement and execute the takeover.
• It shall comply with all statutory requirements related to the takeover.

6. INDEMNITY

6.1 The Proprietor agrees to indemnify and hold the Company harmless from any claims, damages, or liabilities arising from the business operations before the date of takeover. 6.2 The Company agrees to indemnify and hold the Proprietor harmless from any liabilities arising after the takeover.

7. EFFECTIVE DATE & CLOSING

7.1 The takeover shall be effective from [Effective Date]. 7.2 The Proprietor shall hand over all books of accounts, records, and necessary documents to the Company on or before the closing date.

8. CONFIDENTIALITY

Both parties agree to maintain confidentiality regarding the terms of this Agreement and any proprietary business information.

9. DISPUTE RESOLUTION

Any disputes arising from this Agreement shall be resolved through arbitration in accordance with the Arbitration and Conciliation Act, 1996. The venue for arbitration shall be [City].

10. GOVERNING LAW

This Agreement shall be governed and construed in accordance with the laws of India.

11. MISCELLANEOUS

11.1 This Agreement constitutes the entire understanding between the parties and supersedes any prior agreements, representations, or understandings. 11.2 No modification shall be valid unless made in writing and duly signed by both parties.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

SIGNED AND DELIVERED BY:
For [Proprietorship Firm Name]
(Proprietor)
[Name of Proprietor]

For [Private Limited Company Name]
(Authorized Signatory)
[Name of Director/Authorized Representative]