Sale of shares agreements with mortgage agreement and warranties. A standard sale of shares agreement, however the purchaser utilises a mortgage of its shares as security for the vendor. In other words, the shares are released to the purchaser when and if the balance of the purchase price is paid on a piecemeal basis.
Sample
"A. The Vendor is the registered proprietor of «a5» ordinary shares ("the Shares") in «a6» of «a7» ("the Company").
B. The Vendor has agreed to sell to the Purchaser and the Purchaser has agreed to buy from the Vendor the Sale Shares for the Purchase Price set out in this Agreement.
4 PURCHASE PRICE
4.1 The Purchase Price for the Sale Shares is such Purchase Price as is described in Part 10 of Schedule 1 and the Purchaser agrees to pay to the Vendor the Purchase Price as follows:-
4.1.1 Such deposit as is described in Part 11 of Schedule 1 on the Settlement Date;
4.1.2 The balance of the Purchase Price as is described in Part 12 of Schedule 1.
4.2 The whole of the Purchase Price will become immediately due and payable on the happening of any of the following events:-
4.2.1 any default by the Purchaser under the terms of this Agreement;
4.2.2 Any default by the Purchaser under the terms of any security referred to in Clause 6.
4.3 The Purchase Price must be paid either in cash or by bank cheque drawn by a Bank as defined in the Banking Act or by a Bank established by any other Act of any State of Australia.
7 SECURITY
The Purchaser agrees to grant to the Vendor on the date of this Agreement:-
7.1 a Mortgage over the Sale Shares as security for payment of the balance of the Purchase Price on terms and conditions satisfactory to the Vendor as set out in Schedule 2; and
7.2 A guarantee from the Directors of the Purchaser and the Directors of «a6»; and
7.3 A charge over the assets of the Purchaser. "
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(f) Mortgage agreement and warranties - sale of shares-SHARES 7
