Q&As

Could a clause in a share purchase agreement that states ‘Nothing in the SPA applies to exclude or limit the liability of the seller to the extent that any claim arises or is delayed as a result of dishonesty, fraud…by the seller’ amount to a contingent liability that might prevent the seller from placing the company into an MVL following sale?

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Produced in partnership with Caroline Clark
Published on LexisPSL on 03/08/2018

The following Restructuring & Insolvency Q&A produced in partnership with Caroline Clark provides comprehensive and up to date legal information covering:

  • Could a clause in a share purchase agreement that states ‘Nothing in the SPA applies to exclude or limit the liability of the seller to the extent that any claim arises or is delayed as a result of dishonesty, fraud…by the seller’ amount to a contingent liability that might prevent the seller from placing the company into an MVL following sale?

Could a clause in a share purchase agreement that states ‘Nothing in the SPA applies to exclude or limit the liability of the seller to the extent that any claim arises or is delayed as a result of dishonesty, fraud…by the seller’ amount to a contingent liability that might prevent the seller from placing the company into an MVL following sale?

If the seller of the shares had sold all shares owned in the company concerned, then the seller could no longer be involved in the process of the shareholders passing a resolution to put the company into liquidation. It has been assumed for the purposes of this Q&A that the seller would still hold some shares in the company concerned and so would be involved in the passing of the resolution to put the company into

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