Selling the pvt co.

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Kapil Bisht (Querist)
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21 July 2016 why do we need purchase agreement and indemnity bond while transfering shares of pvt.co. with an objective to sell the private co.....?

c.bakshi

c.bakshi (Expert)
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24 July 2016 PURCHASE AGREEMENT acts as the basis of evidence to prove, that the transaction is taken place on that day, in the court of law.

indemnity bond act as a resolution mechanism for the prospective buyer of the company. so if there is any undisclosed liability of the past directors or the company, then they shall be responsible to pay it.