The typical compensation obligations of a seller are, among other things, the compensation of the buyer: the buyer, as a shareholder or manager, makes the feet of the seller, but the employees, contracts, real estate, etc. of the company remain the property of the company. The transfer of the company`s assets is therefore not necessary, so a sale of shares can often be completed without the participation of third parties. The purchase of shares is therefore often much more discreet than a purchase of assets. Once the shares of the target transaction are transferred, the property is transferred to the buyer. It is likely that the buyer would likely appoint new directors, accountants, etc. The buyer may also want to remove the current officers. The sales contract is one of the most important documents in the life of an owner`s business. This is why it must be treated with care and rigour, with legal experts guiding both the seller and the buyer. A BSG that is the subject of fierce negotiations and nuances generally contains a compensation clause for liability for losses resulting from misrepresentations and violations of guarantees, alliances and other agreements. The compensation clause may be considered an exclusive remedy or a non-exclusive remedy to assert these rights. As an exclusive remedy, the compensation provisions should specify when and how claims should be filed, processed and paid for, as well as any payment and liability restrictions or qualifications. As a general rule, the acceptance of an exclusive remedy would constitute a waiver of the parties to all remedies that would otherwise be available under existing legislation.
However, there are exceptions to this exclusivity in cases of fraud, intentional offences, intentional misconduct and appropriate remedies. Most companies and shareholders prefer to enter into an agreement based on the Corporations Act, which essentially authorizes the provisions on all other points. In particular, it guarantees accountability on the basis of rights, with a responsibility for both parties, which provides considerable assistance to the proceedings.