Share Transfer Agreement Drafting Service

Service for Drafting Share Transfer Agreements for Startups and SMEs in the Health and Beauty Industry

Growth Trends in the Health and Beauty Industry

The health and beauty industry is experiencing continuous growth and expansion every year. People of all ages and genders are increasingly prioritizing their health and self-care. This trend has led to a growing market value, attracting many startups and SMEs to compete in the health and beauty market. Large brands are also adapting by developing their brands and products to meet the demands of consumers focused on self-care and health. Consequently, new companies are being established, and existing businesses are expanding to meet the increasing market demand comprehensively.

For businesses that see growth opportunities in the market, attracting investors and those wanting to participate in driving the business or even expanding business scopes with the government sector is common. In such cases, share transfers may occur through sales, transfers, or exchanges of shares. When shares change ownership, whether due to shareholder desires or changes in company share proportions, business policies and roles will adjust according to the new shareholders’ defined roles and responsibilities. Therefore, the Share Transfer Agreement is a crucial tool that serves as legal evidence of the change in shareholders, preventing future legal disputes.

The Importance of a Share Transfer Agreement in the Health and Beauty Industry

Shareholders play a significant role in business operations, depending on their investment proportion. They have basic rights under the law, such as attending meetings, voting, and receiving comprehensive company information. The benefits they receive from business activities are ‘profits per share’ or dividend declarations. If the company faces negative impacts, shareholders will also incur losses. Even though shareholder changes can be managed internally without needing to file with the registrar, the transfer process must be legally compliant and documented between the transferor and transferee with a Share Transfer Agreement.

In the health and beauty industry, which prioritizes product safety due to its direct use on the body, legal compliance is crucial. Internal roles, measures, and policies must be clearly defined, especially for shareholders with significant investments who play a role in setting these policies. Therefore, any change in shareholders necessitates drafting a legally binding Share Transfer Agreement. TIBD is ready to provide this service for businesses in the health and beauty industry with over 10 years of experience and expertise in the field.

Why Is a Share Transfer Agreement Important?

A Share Transfer Agreement is a legal document evidencing the transfer of share ownership from the transferor to the transferee, serving the following purposes:

1. Legal Clarity:
   • Specifies details about the number of shares transferred, share type, share price, transfer date, payment method, and other related conditions.
   • Prevents legal disputes between the transferor, transferee, and third parties.
   • Confirms the accuracy and legitimacy of the share transfer.
2. Evidence of Payment:
   • Serves as proof of share payment if the transferee has not paid in full.
   • Supports the transferor’s right to claim remaining share payments.
3. Registration Documentation:
   • Used for registering the transfer of share ownership with relevant authorities.
   • Updates shareholder information in the company’s registry.
4. Proof of Share Acquisition:
   • Provides evidence of share acquisition for purposes such as mortgage, resale, or other uses.
5. Tax Documentation:
   • Used for personal income tax purposes if the transferor profits from the share transfer.

Therefore, a Share Transfer Agreement is essential for the transferor, transferee, and third parties, ensuring the share transfer is legally compliant, efficient, and prevents legal issues. The agreement should be detailed, clear, factual, and lawful to be legally enforceable.

Steps and Process for Developing a Share Transfer Agreement

Currently, whether transferring shares to individuals or entities, share transfers can be agreed upon and managed internally between the transferor and transferee. However, after completing the sale and transfer, signing the agreement, and changing ownership, company officers must submit an amended ‘List of Shareholders (Form BOJ.5)’ to the Department of Business Development. The company officers prepare and submit the revised shareholder list or Form BOJ.5 to the Department of Business Development (DBD).

A Share Transfer Agreement, as a legal document, should be detailed, clear, factual, and lawful to be enforceable and prevent future legal issues. Important considerations in drafting a Share Transfer Agreement include:

1. General Information:
   • Complete names, addresses, and identification numbers of the transferor and transferee.
   • Correct company name, company type, business registration number, and company address.
   • Clear contract date.
2. Share Transfer Details:
   • Correct number of shares transferred, share type, and share registration number.
   • Total share price.
   • Share payment method and schedule.
   • Share transfer date.
3. Transfer Conditions:
   • Complete, clear, and factual transfer conditions.
   • Complete, clear, and factual other related conditions.
4. Certification:
   • Signatures and seals (if applicable) of the transferor and transferee on the Share Transfer Agreement.
   • Signatures and seals (if applicable) of two witnesses on the Share Transfer Agreement.
5. Appendices and Attachments:
   • Copies of the transferor’s, transferee’s, and witnesses’ identification cards.
   • Copy of the shareholder register.
   • Proof of share payment (if applicable).

Other important considerations include using clear and simple language, organized formatting for readability, and verifying information, conditions, and language accuracy before signing.

Documents Required for Drafting a Share Transfer Agreement:

• Copies of the transferor’s and transferee’s identification cards.
• Copies of the transferor’s and transferee’s house registration.
• Copy of the business registration certificate.
• Copy of the company’s memorandum of association.
• Copy of the shareholder register (Form BOJ.5).
• Shareholder or board meeting resolution approving the share transfer.
• Share Transfer Agreement (written contract).

Businesses in the Health and Beauty Industry That We Advise

With over 10 years of experience in the health and beauty industry, we are well-equipped to provide consultation on drafting agreements, especially within the following specialized industries:

• Cosmetics Industry
• Food Supplement
• Food Industry
• Pharmaceutical Industry
• Medical Equipment Industry

Benefits of Using TIBD’s Share Transfer Agreement Drafting Services

1. Expertise in Industry-Specific Legal Requirements: With TIBD’s legal experience and knowledge in the industry, we help draft agreements that comply with the law and contain clear details, tailored to each business’s objectives and needs.
2. Building Credibility: Well-drafted and legally compliant agreements enhance business credibility, showcasing professional operations crucial for startups and SMEs seeking investment and growth.
3. Risk Reduction: TIBD provides consultation and drafts agreements in collaboration with a professional legal team, reducing risks and the likelihood of legal disputes.
4. Convenient and Efficient Service: We simplify complex processes during agreement drafting, saving time and preparing necessary documents promptly.

For startups and SMEs with little experience in the health and beauty industry, don’t let legal complexities hinder your business growth. If you are interested in using our Share Transfer Agreement Drafting Service with TIBD and need expert consultation, please contact us Click here, more information here.