Signing conditions


Depending upon the vendor’s transaction schedule:

  • interested buyers are provided with a draft of the contract
  • contractual negotiations begin whilst DD is underway or only after the investor has stated its willingness to buy or submitted a ball-park offer.


There are no formal requirements (Article 11 of the Swiss Code of Obligations).

Contents of the contract

(purchase agreement)

The share purchase agreement will contain the following preliminary provisions setting out an introduction and historical background:

  • title of the legal transaction
  • details of the parties including registered offices and addresses
  • details of authorised representatives
  • specification of the type of transaction
  • preamble (introduction including, where appropriate, historical background).

Essential terms

The share purchase agreement must contain the following essential terms:

  • purchase object
    • specification of the shares of the business represented which are to be transferred
    • type
      • bearer shares
      • nominal shares
    • number
  • purchase price (consideration)
  • redemption, along with specification of outstanding purchase price.

Further terms

Generally, the “Further terms” regulate the following issues:

  • transfer of possession and transfer of rights and duties, along with benefits and risks
  • determination of entitlement to dividends
    • declared but unpaid dividends
    • undeclared dividends
  • general warranty (for shares)
  • assurances relating to the business
    • the company was lawfully incorporated and currently exists
    • closing accounts are available, and are correct and comprehensive
    • no pending or imminent events which would be detrimental to the business’s image or accounts
    • no unknown agreements
    • business insured according to standard sectoral practice
    • intellectual property rights exist as assured
    • no pending court proceedings, including administrative and criminal proceedings
    • necessary business permits have been obtained
    • confirmation that social charges and employee benefits are paid monthly
  • escrow agreement
  • approvals
  • reservations
  • rules on changes to assets between signing and closure
  • notice to creditors
  • collateral
  • joint and several liability + recourse
  • responsibility for costs
  • list of contracts of employment to be transferred (Article 333 of the Swiss Code of Obligations)
  • list of insurance relationships to be transferred
  • agreement on procedures for amendments or supplements
  • applicable law
  • jurisdiction
  • relationship between the asset take-over agreement and the LOI
  • severability clause

Balance sheet guarantee

A balance sheet guarantee assures the buyers of shares that the balance sheets presented (reference balance sheets) were drawn up according to the accounting standards specified (IFRS, GAAP, etc) and that the reference balance sheets faithfully represent the asset and revenue situation of the target company and that this representation is accurate and complete.

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