NSW Private company share sale

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TTS

Active Member
19 August 2020
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0
31
My wife and I hold the only paid-up shares in our company. There is a potential buyer of the company who doesn't have sufficient funds to pay for the full value of the shares. Is it legal to sell the shares to him for a down payment, at which time the shares pass to him, with the balance owed being paid within an agreed time? Effectively vendor finance for the sale of the company shares?
 

Rod

Lawyer
LawTap Verified
27 May 2014
7,269
990
2,894
Yes and yes.

You need an appropriate sale of business contract and reversion clauses.
 

Tim W

Lawyer
LawTap Verified
28 April 2014
4,329
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2,894
Sydney
Yes, but it's an unwise choice, unless you can 200% certain of being paid.