EXAMPLE OF SHARES TRANSFER AGREEMENT 2023

The transfer of shares is regulated in the Law of Enterprises 2020, accordingly, enterprises are free to choose whether transferring shares shall be conducted in the form of agreements (as the example of shares transfer agreement 2023 below) or a transaction on the securities market. Accordingly, in the case of transferring shares by a contract, such transferring must be signed by the assignor and assignee or their authorised representatives. Meanwhile, in case transferring shares on the securities market shall be conducted by the procedures specified in the law on securities.[1]

Pursuant to Article 111.1.(a) of Law on Enterprises 2020, shares mean the charter capital which is divided into equal portions. In the case of transferring by agreements, Shareholders of the join stock company can consider using the example of shares transfer agreement 2023 to transfer their shares to other persons, except in the case of restrictions on assignment of shares, as follows:[2]

• Transfer shares of founding shareholders within a period of 03 years from the date of issuance of the ERC to the company.[3]

The restrictions on the right of share transfer in this circumstance are in order to ensure the company’s stability during the first 03 years from the established date. Meanwhile, such regulation also protects the right of a purchaser not being a founding shareholder since they cannot get the company’s status exactly on the new date of establishment.

• The Charter provides the restriction on share transfer.[4]

In case of the restriction on share transfer according to the company’s Charter, such restriction shall only be effective if they are specified in the corresponding share certificate. Besides, such restrictions must be suitable and comply with the law.

Above is an overview of share transfer. If you have difficulty in finding a Law Firm to advise and support in the legal aspect related to enterprises, please contact us.

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In the below, we provide you the example of shares transfer agreement 2023 with the basic needed content when transferring shares.

 

SOCIALIST REPUBLIC OF VIETNAM

Independence – Freedom – Happiness

— 

SHARES TRANSFER AGREEMENT

• Pursuant to the Charter of company [_];
• Pursuant to Law on enterprises 2020;
• Pursuant to the two parties’ needs.

Today, on [_], we include:

Assignor:

Mr./Ms.: ……………………………………………………………………………………………

ID card no.: …………… issued on ………………………… by ……………………………

Permanent residence in: …………………………………………………………………………

Assignee:

Mr./Ms.: ………………………………………………………………………………………………

ID card no.: …………………………………………………………………………………………

Permanent residence in: ……………………………………………………………………………

The two parties agree on transferring shares with the following agreements:

Article 1: The Agreement’s purpose

• Party A is holding [_] shares of the [_] shareholding company accounted for [_]% the charter capital in line with the Enterprises registration certificate no. [_], issued by [_] on [_].
• Party A agrees to transfer Party B contributed shares in company which is [_] shares equal to [_] VND (in word: ………) accounted for [_]% the charter capital.

Article: Price and the method of payment

• Party A pays Party B the value of transferred shares as stated in Article 1 of this Agreement.
• The duration of payment: pay in one lump sum after signing the Agreement.
• Method of payment: transfer in the bank account assigned by Party A.

Article 3: Rights and obligations of each Party

• Rights and obligations of Party A

1. Party A receives the payment of the transferred shares’ value as stated in Article 1 of this Agreement.
2. Party A is obliged to transfer all shares that Party A has agreed to transfer as in Article 1 of this Agreement to Party B immediately after signing this Agreement.
3. Party A is obliged to perform the notification obligations (if any), complete the dossier to complete the transfer of shares under this Agreement.
4. …………………………………………………………………………………

• Rights and obligations of Party B

1. Party B has the right to inherit all the rights and obligations of Party A as a shareholder of the [_] shareholding company from the date of completion of the shares transfer.
2. Party B is obliged to pay Party A on time the value of the transferred shares as mentioned in Article 1 of this Agreement.
3. Party B is obliged to assist Party A in completing the dossier and procedures to complete the shares transfer.
4. …………………………………………………………………………………

Article 4. Commitment of Parties

The two Parties commit to the information about the identity, the transferred shares stated in the Agreement is true. Shares transferred without dispute, not distrained to ensure judgment enforcement. Entering into the Agreement is completely voluntary, without deception or coercion. Party B has carefully considered and knows about the above transferred shares and related legal documents. Both Parties are responsible for properly and fully implementing the agreed contents in the Agreement.

Article 5. Dispute settlement

Any dispute (if any) arising out of or in connection with this Agreement will be mutually negotiated by both Parties on the principle of respecting each other’s interests. In case of failure to settle, either Party has the right to initiate a lawsuit to request a competent court to settle in accordance with current law.

Article 6. The validity of Agreement

• Both Parties have read, understood, and agreed to all terms stated in the Agreement before signing this Agreement.

The legal representative of [_] shareholding company only signs to confirm when the two Parties have completed the transfer according to the content of this Agreement.

• This Agreement takes effect from the time of signing by the Parties and is made into 04 copies with equal validity, Party A keeps 01 copy, Party B keeps 01 copy, 01 copy is retained by the company, 01 copy is submitted to Business registration office under the Department of Planning and Investment of the province/city [_].

Party A (sign and specify full name)       ——————	Party B (sign and specify full name)       ————————
Confirmation of the legal representative of the company (The Parties have completed the transfer under the Agreement on …) (sign, specify full name and position of legal representative, seal the company)         ———————————–

[1] Article 127.2 Law on enterprises 2020

[2] Article 111.1.(d) Law on enterprises 2020

[3] Article 120.1 Law on enterprises 2020

[4] Article 127.1 Law on enterprises 2020