Equity Repurchase Agreement Template for South Africa

This Equity Repurchase Agreement template is designed for use in South African corporate transactions where a company intends to buy back its own shares from existing shareholders. The document is structured to ensure compliance with the Companies Act 71 of 2008, particularly regarding solvency and liquidity tests, shareholder approvals, and regulatory requirements. It is commonly used in scenarios such as corporate restructuring, shareholder exits, capital management, or black economic empowerment transactions. The agreement includes essential provisions for purchase price determination, payment terms, conditions precedent, completion mechanics, and necessary warranties, while incorporating specific South African regulatory requirements including those from the JSE (for listed companies) and the Competition Commission where applicable.

1. Parties: Identification of the Company (Purchaser) and the Shareholder(s) (Seller(s))

2. Background: Context of the agreement, including details of the company's share capital and the seller's shareholding

3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement

4. Sale and Purchase: Core provisions regarding the sale and repurchase of shares, including number of shares and purchase price

5. Purchase Price and Payment: Details of the consideration, payment method, and timing

6. Conditions Precedent: Required approvals and conditions that must be met before the repurchase can proceed, including solvency and liquidity tests

7. Completion: Mechanics of completion, including timing, location, and actions required by each party

8. Seller's Warranties: Warranties regarding ownership, authority to sell, and status of the shares

9. Company's Warranties and Undertakings: Warranties regarding corporate authority, solvency, and compliance with laws

10. Confidentiality: Obligations regarding confidential information and announcements

11. Notices: Process and requirements for formal communications between parties

12. General Provisions: Standard boilerplate clauses including governing law, jurisdiction, and entire agreement