The steps are as follows:
Steps and matters needing attention in equity transfer of limited liability company.
Step 1: Investigate the target company.
Precautions:
1. The ownership structure, assets, liabilities, tax arrears and contingent liabilities of the target company shall be specified. It is particularly important to note that the contingent liabilities of the target company due to external guarantees are not reflected in the balance sheet.
2. It is also necessary to understand the contents of the articles of association of the target company, and pay special attention to the restrictive clauses on equity transfer in the articles of association. Under normal circumstances, the transferee and the transferor shall jointly hire lawyers, accountants, asset appraisers and other intermediaries to conduct due diligence on the legal status, financial status and important assets of the target company, and take the due diligence report as an annex to the equity transfer contract.
Step 2: The transferor and the transferee sign the letter of intent for equity transfer.
Precautions:
1. Two special clauses shall be stipulated in the letter of intent for equity transfer:
1. Effective conditions: This Letter of Intent shall come into effect after more than half of other shareholders of the target company agree to this transfer and give up the preemptive right (under the conditions stipulated in the Company Law) or/and meet the relevant conditions stipulated in the articles of association of the target company;
Ii. notification obligation of the transferor: the transferor shall notify other shareholders of the target company within a certain period after signing this letter of intent.
2. Determination of transfer price
At present, the methods commonly used in practice to determine equity transfer price are:
First, the transfer price is directly based on the transferor's capital contribution in the target company;
Second, the transfer price is the product of the target company's book net assets and the transferor's shareholding ratio;
Third, the product of the audited net assets of the target company and the transferor's shareholding ratio is the transfer price;
Fourth, determine the transfer price through bidding, auction and other bidding transactions. The first and second methods mentioned above are not simple and can only be used in newly established companies. The fourth method can usually determine the market price of equity more accurately, but its disadvantages are complicated procedures and high transaction costs. The third method can only determine the simple static value of the assets such as factory buildings, machinery and equipment of the target company, and cannot reflect the growth and development factors of the company as an organism.
Regarding the determination of the transfer price, the author's opinion is that equity transfer price can adopt the first and second methods to determine the newly established company; For large companies or companies involving state-owned assets, the fourth method should be adopted; For general companies, both parties to the transaction can determine the transfer price through consultation on the basis of auditing and evaluating the net asset value and referring to the future profit prospects and market risks of the target company.
Step 3: The transferor notifies other shareholders of the target company.
Precautions:
The transferor shall notify other shareholders of the target company in writing within the time specified in the letter of intent, and ask them to express their opinions on whether to agree to transfer or exercise the preemptive right within a certain period of time (at least 30 days specified in the company law), or/and perform the procedures specified in the articles of association.
Step 4: Other shareholders of the target company make statements.
Precautions:
1. According to Article 72 of the new Company Law, if other shareholders do not agree to the transfer, they shall purchase the equity to be transferred by the transferor; otherwise, they shall be deemed to agree to the transfer. That is, other shareholders can only prevent the transferor from transferring its equity to the outside world by exercising the preemptive right.
2. The preemptive right of other shareholders cannot be exercised separately. In other words, other shareholders can only buy all the shares to be transferred by the transferor, otherwise they must give up all the purchases, not just part of them.
3. Other shareholders should pay attention to prevent the transferor and transferee from damaging their preemptive right through yin-yang contract. In practice, the more effective method is that other shareholders require both parties to confirm the transfer price in writing and supervise the performance of the transfer contract.
Step 5: The transferor and the transferee sign a formal equity transfer contract.
Precautions:
1. Unless equity transfer price, payment method and payment term cannot be changed. Moreover, the letter of intent cannot be substantially changed, otherwise it may be opposed by other shareholders because it constitutes a yin-yang contract, or even revoked or invalidated by the court.
2. If other shareholders of the target company think that their preemptive right has been infringed, they can bring a lawsuit to the court. This kind of lawsuit should list the transferee as a third party.
3. In order to protect the rights of the transferee, it should be stipulated in the contract that before the equity transfer, when the target company is punished by the state organs or claimed by others for its behavior, the transferee has the right to terminate the contract within a certain period of time, and clearly stipulate the standard of liquidated damages or the calculation method of damages.
Step 6: handle the change of the company's shareholder list and industrial and commercial registration.
Precautions:
1. Just signing the equity transfer contract does not mean that the transferee has obtained the shareholder qualification of the target company. Article 33 of the new Company Law stipulates the internal and external effects of the company's shareholder register and industrial and commercial registration in confirming shareholder qualifications. From the point of view of fulfilling the equity transfer contract and reasonably protecting the rights of the transferor and the transferee, these two tasks should be carried out as soon as possible.
2. Handling the change of the company's shareholder list and industrial and commercial registration requires the cooperation of the target company and other shareholders. If the target company and other shareholders refuse to cooperate with the relevant work, the transferee may file a lawsuit to confirm the shareholder qualification. This lawsuit should list other shareholders and the target company as * * * co-defendants.
Company equity transfer procedure