Share Purchase Agreement Template: Free SPA Template With Drafting Guide

A share purchase agreement template is the reusable, clause-by-clause skeleton that buyers and sellers start from when one party is acquiring the issued share capital of a private company. Whether you are pulling a share purchase agreement template off the shelf for a UK Companies Act 2006 limited company, a Delaware C-corporation, an S-corp with a Section 338(h)(10) election overlay, or a BVI holding structure, the same eleven moving parts have to be tuned: definitions, share transfer mechanics, consideration and adjustment, conditions precedent, pre-completion covenants, warranties, indemnities or the tax covenant, limitations on liability, restrictive covenants, termination, and boilerplate. This guide gives you a free share purchase agreement template, walks every section the way a Magic Circle or AmLaw 50 associate would mark it up on a first draft, and flags the clauses that disproportionately determine whether the deal closes or blows up. The skeleton draws on the Law Society of England and Wales precedent forms, the ABA Model Stock Purchase Agreement Second Edition (2010), and the 2024 SRS Acquiom M&A Deal Terms Study covering 2,100 private targets (SRS Acquiom 2024 M&A Deal Terms Study).

One thing to take from this page: a share purchase agreement template is a starting position, not a final draft. The 2023 ABA Private Target M&A Deal Points Study reviewed 119 deals signed 2022 to first-half 2023 and found the median negotiation cycle from first SPA draft to signing was 78 days, with a median of 11 turn-rounds between buyer and seller counsel (ABA Business Law Section M&A Committee). Every clause below is a place where negotiation can stall.

Share Purchase Agreement Template at a Glance: Quick-Reference Table

Clause	What It Does	Where Buyers and Sellers Fight
1. Definitions and Interpretation	Defines every capitalized term and rules of construction	Material Adverse Change, Knowledge, Indebtedness, Working Capital, Leakage
2. Sale and Purchase of Shares	Mechanics of share transfer, beneficial title at completion	Pre-emption waivers, drag-along compliance, stock transfer form vs share certificates
3. Consideration and Adjustment	Purchase price, locked-box or completion accounts, escrow	Working capital peg, cash-free debt-free treatment, earn-out triggers
4. Conditions Precedent	What must be true before parties can close	Antitrust, regulatory, third-party consents, MAC bring-down
5. Pre-Completion Covenants	What sellers can and cannot do between signing and closing	Ordinary course definition, exclusivity, no-shop, antitrust efforts
6. Completion (Closing)	Closing day mechanics, deliverables, simultaneity	Funds flow, share certificates, resignation letters, escrow funding
7. Warranties	Seller statements of fact about the company and the shares	Disclosure scope, knowledge qualifiers, 10b-5 catchall, business warranties
8. Limitations on Liability	Caps, baskets, thresholds, time bars	De minimis, basket, cap as percent of consideration, fundamental vs general
9. Tax Covenant or Indemnity	Pre-completion tax indemnity, 338(h)(10), straddle period	Tax covenant scope, refunds, surrender of group relief
10. Restrictive Covenants	Non-compete, non-solicit, non-poach on sellers	Duration (24-36 months), geographic scope, blue-pencil mechanics
11. General / Boilerplate	Governing law, jurisdiction, notices, assignment	English law vs Delaware, jury waiver, fee shifting, parent guaranty

Download the Free Share Purchase Agreement Template

The full editable share purchase agreement template referenced throughout this guide is a 42-page document structured around the eleven clauses above. It is drafted in dual-flavour neutral English so a single starting form can be adapted to either a Companies Act 2006 private limited company sale or a Delaware General Corporation Law share sale. It is meant for a privately held target with a single seller or small group of sellers acting through a sellers’ representative, all-cash or part-deferred consideration, a working capital adjustment or locked-box mechanic, escrow holdback, and a 24-month survival on general warranties. Get a qualified securities and tax lawyer to adapt it before you sign. The template includes a sample disclosure letter index, a working capital schedule, an escrow agreement, and a transitional services schedule.

The template numbering follows the Practical Law Company precedent SPA structure used by London City firms (Slaughter and May, Linklaters, Freshfields, Allen and Overy, Clifford Chance) and the ABA Model Stock Purchase Agreement Second Edition skeleton used by US firms (Wachtell Lipton, Skadden, Cravath, Kirkland, Latham). Where the two diverge, the template carries optional language in brackets with a drafting note. The starting market positions (10% escrow, 1% basket, 20% cap on general warranties, 24-month survival, 7-year tax covenant) are derived from the median private-target deal terms in the 2024 SRS Acquiom study and the 2023 ABA Deal Points Study.

What This Template Covers and What It Does Not

Covered: 100% share sale of a private UK limited company or Delaware corporation, small group of sellers, all-cash or part-deferred consideration, working capital or locked-box adjustment, escrow holdback, 24-month general warranty survival, 7-year tax covenant, customary restrictive covenants. Not covered: share-for-share mergers (use a merger or scheme of arrangement document), asset purchases (use an APA), public-company tender offers (use a Schedule TO or Rule 2.7 announcement), regulated industries (banking, broker-dealer, insurance, defense, gaming all add layers), and minority share purchases under a shareholders’ agreement (use a short share transfer instrument plus deed of adherence).

Share Sale vs Asset Sale: Why Template Choice Matters

Buyers usually prefer asset purchases because they get a stepped-up tax basis and can cherry-pick liabilities. Sellers usually prefer share sales because they get a single capital gain event (US: long-term capital gains at 20% federal plus 3.8% net investment income tax under IRC Section 1411; UK: business asset disposal relief at 14% on the first GBP 1 million of lifetime gains from April 2025, per HMRC BADR guidance) instead of double taxation when a corporation sells assets and then distributes proceeds. The economic gap can be 15 to 20 percentage points of after-tax proceeds. PwC’s 2024 M&A tax insights estimate a stock sale of a $50 million C-corp returns roughly $36 million net to a founder versus $28 to $30 million in an asset deal at the same gross price (PwC M&A Tax Insights 2024).

In the US, the Section 338(h)(10) election bridges the gap by treating a share sale of an S-corp or a corporate subsidiary as a deemed asset sale for federal tax purposes. Under IRC Section 338(h)(10) and Treasury Regulation 1.338(h)(10)-1, buyer gets the asset basis step-up; seller gets share-transfer simplicity. The template carries an optional clause 9.4 covering the joint election, the seller gross-up, and Form 8023 filing (within 8.5 months per IRS Form 8023 Instructions). For the wider deal-structure framework, see the business valuation formula methods and math guide. In the UK there is no equivalent; a UK share sale is taxed as a single chargeable gain at 24% capital gains tax (up from 20% on October 30, 2024 per the Budget; see HM Treasury Autumn Budget 2024).

Clause 1: Definitions That Quietly Move Millions

Clause 1 looks like boilerplate. It is not. Six defined terms control more economic outcomes than any other section of the share purchase agreement template.

Material Adverse Change (MAC) or Material Adverse Effect (MAE). Determines whether the buyer can walk between signing and closing if something bad happens to the target. The Delaware Court of Chancery set the modern standard in Akorn, Inc. v. Fresenius Kabi AG, 2018 WL 4719347 (Del. Ch. Oct. 1, 2018), the first reported decision finding an actual MAE since the framework was articulated in IBP, Inc. v. Tyson Foods, 789 A.2d 14 (Del. Ch. 2001). In England, the only reported MAC case is Grupo Hotelero Urvasco SA v Carey Value Added SL [2013] EWHC 1039 (Comm), which held the bar is very high (Grupo Hotelero v Carey, BAILII). The carve-outs (industry-wide effects, changes in law, pandemic, war) are the most negotiated lines in the template. For drafting note depth, see the material adverse effect guide.
Knowledge. Limits seller warranty exposure to facts within a named group’s actual or constructive awareness. The 2023 ABA Deal Points Study found 67% of private deals scope Knowledge to a named list of 4 to 7 individuals with reasonable-inquiry constructive knowledge; 31% restricted it to actual knowledge only. The template defaults to actual-plus-reasonable-inquiry with bracketed alternative.
Indebtedness. Drives the cash-free debt-free completion mechanic. A broad Indebtedness definition capturing lease obligations, deferred consideration on prior acquisitions, pension underfunding, accrued bonuses, and tax provisions can shift millions in completion-day price adjustment.
Working Capital. Reference target for the adjustment. The 2024 SRS Acquiom study found median post-closing working capital adjustments of $0.4 million on deals with median enterprise values of $250 million, with 9% of deals adjusting more than $5 million.
Leakage (locked-box deals only). Defines value-extraction by sellers between locked-box date and completion: management bonuses, dividends, related-party payments, non-ordinary-course transactions. Clause 3.6 ties Leakage to a pound-for-pound recovery right.
Permitted Leakage. Carve-out covering ordinary-course salaries, contractual bonuses, and intra-group trading. Sellers always push for a broad list; buyers push back.

Clauses 2 and 6: Mechanics of Share Transfer and Closing

Clause 2 is the operative provision: at completion, sellers transfer the sale shares to the buyer with full title guarantee, free from encumbrances. In a UK share purchase agreement template, transfer happens by executed stock transfer form lodged with the company’s registrar, with stamp duty of 0.5% on consideration above GBP 1,000 paid to HMRC Stamp Office within 30 days. The buyer’s name then goes into the register of members under Companies Act 2006, s.113. In a US template, transfer happens by endorsement of share certificates with stock powers, or book entry under UCC Article 8. There is no federal stamp duty; Delaware imposes 0% transfer tax on share sales; New York’s $0.05-per-share stock transfer tax is fully rebated under NY Tax Law Section 270-e (NY Department of Taxation Stock Transfer Tax).

Clause 6 is the day-of-closing playbook. Buyer wires consideration to seller (less escrow holdback, less transaction expenses, less indebtedness paid off at completion); seller delivers signed stock transfer forms or endorsed share certificates; both parties sign the closing certificate, escrow agreement, and ancillary documents. The closing checklist for a typical US private-target share deal runs 75 to 120 line items: secretary’s certificates, good-standing certificates, lien releases (UCC-3 filings), payoff letters, resignation letters from outgoing directors, and FIRPTA non-foreign affidavits under IRC Section 1445.

Clause 3: Consideration, Locked-Box vs Completion Accounts, and the Adjustment Mechanic

Clause 3 sets the headline purchase price and the mechanic for adjusting it from signing to completion. There are two dominant approaches: completion accounts (US default) and locked-box (UK and European default).

Under completion accounts, the parties sign an estimated purchase price, complete on that estimate, then prepare a completion balance sheet within 60 to 90 days to derive actual closing working capital, cash, and debt. The buyer or seller pays a true-up. The 2024 SRS Acquiom study found 89% of US private-target deals use a completion accounts mechanic, of which 76% adjust both working capital and net debt and 24% adjust working capital only. Median completion-accounts true-up was $0.4 million on deals between $100 million and $500 million enterprise value.

Under locked-box, the parties agree a fixed equity price by reference to a recent balance sheet date (the locked-box date), and the price does not adjust at completion. Sellers indemnify the buyer for any Leakage between the locked-box date and completion. The 2024 CMS European M&A Study found locked-box was used in 68% of European private-target deals in 2023, up from 56% in 2018 (CMS European M&A Study 2024). Locked-box gives sellers price certainty and reduces post-completion negotiation, but requires deep diligence on the locked-box date balance sheet because there is no second-look adjustment.

Worked Example: Completion Accounts Adjustment

Item	Estimated at Signing	Actual at Completion	Adjustment
Enterprise Value	$100,000,000	$100,000,000	$0
Less: Indebtedness	$(15,000,000)	$(17,200,000)	$(2,200,000) Buyer down
Plus: Cash	$5,000,000	$4,300,000	$(700,000) Buyer down
Working Capital vs Target	$0 (at peg)	$(800,000) (below peg)	$(800,000) Buyer down
Equity Price	$90,000,000	$86,300,000	$(3,700,000) refund to Buyer

The escrow funds the refund. The 2024 SRS Acquiom study found median escrow at 7.5% of purchase price on 2023 private deals, released 18 months after completion, with a smaller indemnity escrow held back for the tax statute of limitations.

Clauses 4 and 5: Conditions Precedent, Ordinary Course, and the No-Shop

Clause 4 lists what must be true before either party is obliged to complete: (a) accuracy of fundamental warranties as of completion; (b) no MAC since signing; (c) regulatory clearances (Hart-Scott-Rodino, UK National Security and Investment Act, EU Merger Regulation, CFIUS where applicable); (d) third-party consents under change-of-control provisions; (e) no injunction. The 2023 ABA Deal Points Study found 64% of deals had at least one required third-party consent and 38% had antitrust filings. The Hart-Scott-Rodino threshold for 2025 is $126.4 million in size-of-transaction, updated annually (FTC HSR Threshold Increase 2025). The UK National Security and Investment Act 2021 imposes mandatory notification for transactions in 17 sensitive sectors (UK Cabinet Office NSIA guidance).

Clause 5 governs what sellers can and cannot do between signing and completion: operate in the ordinary course, and refrain from a specified list of restricted actions (incurring debt above a threshold, hiring or firing senior executives, capex, dividend payments, settling material litigation) without buyer consent. The ordinary course covenant turned into the central legal question of the pandemic-era M&A litigation wave. In AB Stable VIII LLC v. MAPS Hotels and Resorts One LLC, 2020 WL 7024929 (Del. Ch. Nov. 30, 2020), the Delaware Court of Chancery held that Strategic Hotels’ COVID-driven operating changes (closing hotels, furloughing staff) breached the ordinary course covenant even though they were reasonable business responses to the pandemic (AB Stable VIII LLC v. MAPS Hotels, Del. Ch.). The template includes a pandemic-specific carve-out giving sellers explicit permission to take reasonable actions in response to government orders. The no-shop covenant prevents alternative bids during the pre-completion period; the 2024 SRS Acquiom study found 94% of private-target deals contain a hard no-shop with no fiduciary out.

Clause 7: Warranties, the Disclosure Letter, and the 10b-5 Catchall

Clause 7 is where the seller makes statements of fact about the company and the shares the buyer is relying on. Standard categories: title and capitalization, authority, organization, financial statements, absence of changes, no undisclosed liabilities, taxes, properties, IP, contracts, employee benefits and labor, litigation, compliance with laws, environmental, customers and suppliers, related-party transactions. A typical US private-target SPA includes 25 to 45 warranties; a UK SPA has 35 to 60 in a schedule.

The warranties are qualified by the disclosure letter (UK) or disclosure schedules (US). The 2024 SRS Acquiom study found 89% of US private-target SPAs include a “10b-5 catchall” stating that none of the seller’s representations omit any material fact necessary to make them not misleading. UK SPAs typically compensate with a broader general disclosure provision instead. The drafting test for disclosures is whether they are fair and reasonably specific; the leading English case, Levison v Farin [1978] 2 All ER 1149, held that a general statement directing the buyer to review the company’s records did not amount to fair disclosure. The template requires specific page references and dated documents in every disclosure paragraph.

Clause 8: Limitations on Liability, the Cap, the Basket, and the Time Bar

Clause 8 is the most negotiated clause in the share purchase agreement template after the warranties themselves. It sets the financial limits on the seller’s exposure for warranty and indemnity breaches.

Limitation	2024 Market Median (US private)	2024 Market Median (UK private)	Buyer-Friendly	Seller-Friendly
De Minimis (per claim)	$50,000	GBP 25,000	$10,000	$100,000
Basket (aggregate threshold)	0.75% of consideration	1.0% of consideration	0.5%, deductible	1.5%, tipping
Cap on General Warranties	10% of consideration	20% of consideration	50%	5%
Cap on Fundamental Warranties	100% of consideration	100% of consideration	100%	50%
Cap on Tax Indemnity	100% of consideration	100% of consideration	100%	50%
Survival, General Warranties	18-24 months	24-36 months	36 months	12 months
Survival, Fundamental Warranties	Indefinite (or 6 years)	6-7 years	Indefinite	3 years
Survival, Tax Indemnity	7 years (SoL)	7 years	Statute + 60 days	4 years

Source: 2024 SRS Acquiom M&A Deal Terms Study (US); 2024 CMS European M&A Study (UK and EU).

The basket can be a deductible (seller pays only above the threshold) or tipping (seller pays from dollar one once the threshold is met). The 2024 SRS Acquiom study found 76% of deals use a deductible basket, 22% tipping, 2% first-dollar. The template defaults to deductible, with the alternative bracketed.

Clause 9: The Tax Covenant, Section 338(h)(10), and the Straddle Period

Clause 9 is the second-most-expensive clause to get wrong. The tax covenant is a pound-for-pound or dollar-for-dollar indemnity from sellers covering all pre-completion tax liabilities of the target and any tax liabilities arising from a breach of the tax warranties. It runs alongside the tax warranties but provides a stronger recovery because it is not subject to the diminution-in-value rule that applies to warranty claims. The English High Court in Sycamore Bidco Ltd v Breslin [2012] EWHC 3443 (Ch) held that a buyer who relied solely on warranties without a separate tax indemnity could not recover for pre-completion corporation tax liabilities that had been disclosed in the accounts (Sycamore Bidco Ltd v Breslin, BAILII).

The straddle period mechanic allocates tax liability for the year straddling completion: income taxes on a closing-of-the-books basis, property and periodic taxes on per-diem. The template uses the standard ABA closing-of-the-books allocation consistent with the ABA Model Stock Purchase Agreement Second Edition formula.

For US deals where the target is an S-corp or a consolidated-group subsidiary, the Section 338(h)(10) election allows the share sale to be taxed as a deemed asset sale. Where elected, the template requires Form 8023 filed jointly within 8.5 months, deemed sale price allocated under Section 1060 and IRS Form 8883, and a seller gross-up for the incremental tax burden. The gross-up math is iterative (incremental tax depends on consideration, which depends on the gross-up); the template includes a worked example in schedule 8. For UK deals, the tax covenant covers corporation tax, VAT, PAYE and NICs, stamp duty land tax on historic transactions, and liabilities from pre-completion group reorganizations. The template uses 7-year survival aligned to HMRC’s investigation window for deliberate behavior (4 years careless, 20 years deliberate per HMRC Compliance Handbook CH52000).

Clause 10: Restrictive Covenants, Non-Compete, and the Blue-Pencil Question

Clause 10 binds the sellers post-completion: non-compete, non-solicit, non-poach, and non-disparagement. The 2024 SRS Acquiom study found median non-compete duration of 36 months in US deals where the seller stays on as an employee, 24 months where the seller exits; the 2024 CMS European M&A Study found median 24 months in UK and Continental Europe.

Enforceability turns on jurisdiction. Delaware enforces reasonable post-sale non-competes broadly. California presumptively voids non-competes under California Business and Professions Code Section 16600, except where Section 16601 allows a non-compete tied to the goodwill of the sold business. The FTC’s 2024 final rule banning post-employment non-competes excludes the sale-of-business exception under 16 CFR 910.2(a)(2), so M&A non-competes remain enforceable (FTC Non-Compete Rule, January 2024); the Eastern District of Texas vacated the broader rule in Ryan, LLC v. FTC, No. 3:24-cv-00986 (E.D. Tex. Aug. 20, 2024), but the sale-of-business exception was not at issue. In England, the restraint of trade doctrine requires the covenant to protect a legitimate business interest. The Supreme Court in Tillman v Egon Zehnder Ltd [2019] UKSC 32 confirmed that an unenforceable portion can be severed using the blue-pencil test if removing the offending words does not change the meaning of the rest (Tillman v Egon Zehnder, UKSC). The template uses a layered approach: 24-month non-compete with fall-back 18-month and 12-month covenants, so a court can sever the longer while preserving the shorter.

Clause 11: General Provisions, Governing Law, and the Jury Trial Waiver

Governing law: Delaware for US deals, English law for UK deals. The 2024 SRS Acquiom study found 73% of US private-target SPAs choose Delaware law, 14% New York, 8% California, 5% other. Jurisdiction follows law: Delaware Court of Chancery for non-jury matters, federal or state court in Delaware otherwise. US SPAs almost always include a jury trial waiver (91% of US private deals per the 2024 SRS Acquiom study) because a Chancery judge will read 200 pages of warranty and indemnification mechanics; a NY or CA jury may not. English SPAs do not waive jury because civil cases other than libel are not tried by jury in England.

Fee-shifting clauses (loser pays) are unusual in US private deals (the American Rule prevails); the 2024 SRS Acquiom study found only 11% of US deals include fee shifting. English law follows the English Rule (loser pays) by default. The template carries no fee-shifting clause in the US flavor and standard English-rule costs language in the UK flavor.

Template Variants: RWI Insurance, Earnouts, Rollover, Deferred Consideration

The base template is built for an all-cash, single-close uninsured deal. Four overlays extend it.

RWI / W&I Insurance. Representation and warranty insurance (US: RWI; UK and Europe: W&I) shifted the negotiation center of gravity in private M&A. The 2024 Marsh report found 71% of US private-target deals over $50 million enterprise value carry an RWI policy, with premiums of 2.7% to 3.5% of policy limit, retention typically 0.5% to 1% of enterprise value dropping to 0.5% after 12 months. The 2024 Lockton European W&I report found 87% of UK and European private deals over EUR 75 million enterprise value carry W&I, with premiums of 0.9% to 1.4% of limit. Where RWI is in place, clauses 7 and 8 shift: sellers give fuller warranties because the insurance is taking the risk; the seller cap drops to a 0.5% to 1% retention; survival shortens to 18 months matching the policy. The template carries alternative RWI-overlay language in brackets in clauses 7 and 8. For PE-buyer context, see the M&A advisor guide and the sell-side analyst career-track piece.

Earnouts. Deferred consideration tied to post-completion performance metrics (revenue, EBITDA, regulatory milestones). The 2024 SRS Acquiom study found 30% of US private-target deals include an earnout, up from 24% in 2022, median size 17% of total consideration over 24 months. The earnout clause is the single most litigated provision post-completion: the Delaware Court of Chancery in Fortis Advisors LLC v. Johnson and Johnson, 2024 WL 4837866 (Del. Ch. Nov. 20, 2024) awarded $1.745 billion to selling shareholders of Auris Health when J&J failed to use commercially reasonable efforts to hit revenue milestones (Fortis Advisors v J&J, Del. Ch.). The template carries an earnout schedule with an explicit commercially-reasonable-efforts definition tied to the actual-conduct standard the Court used.

Rollover Equity. Common in private equity deals where founder sellers retain 10% to 30% of equity in the post-completion buyer entity. Rollover sellers sign a shareholders’ agreement, employment agreement, and (often) a put-call option agreement. Pulley’s 2024 rollover equity report found median rollover of 18% in PE-backed acquisitions of founder-led businesses (Pulley Rollover Equity Guide 2024).

Deferred Consideration / Seller Note. Cash deferred for 12 to 36 months. The 2024 SRS Acquiom study found 24% of private deals include a seller note, median 11% of consideration. For the math on installment-sale tax treatment, see the installment sale vs cash sale guide. For founders selling original-issue shares, the Section 1202 QSBS exclusion can wipe out federal tax on up to $10 million of gain; see the QSBS Section 1202 small business stock guide. Founders should also check whether selling-executive severance triggers golden parachute 280G tax under IRC Section 280G and IRC Section 4999, and how their founder shares stack interacts with the rollover.

Common Drafting Mistakes Buyers and Sellers Make

Missing or under-scoped tax covenant. Costs sellers and buyers more than any other drafting error (see Sycamore Bidco).
Knowledge left as actual without reasonable inquiry. Sellers get away with not investigating; buyers lose recovery rights.
No 280G shareholder vote condition precedent. Buyer loses deduction; selling executive owes 20% excise tax under IRC Section 280G.
Working capital target set against the wrong reference balance sheet. Sellers structure year-end inventory builds to inflate working capital and then take cash out at completion.
R&W policy not signed before SPA signing. Buyer discovers gaps between policy coverage and SPA reps after the fact.
Indemnity escrow released before tax statute of limitations runs. Buyer left with unsecured claim if a tax issue arises after release.
No specific indemnity for known issues. Known pre-completion liabilities get folded into general indemnification subject to basket and cap; they should be carved out into uncapped specific indemnities.
Disclosure letter without page references. Court rules disclosure is not fair under the Levison v Farin standard.
No fundamental warranty carve-out from basket. Buyer’s capitalization-breach claim subject to 1% basket on a $100 million deal, costing $1 million in unrecoverable loss.
Non-compete drafted without blue-pencil fallback. Court strikes down a 5-year covenant and leaves seller with no restriction at all.
Antitrust efforts covenant ambiguous. Buyer refuses divestiture; deal terminates at outside date; deposit forfeited.
Sandbagging provision missing or wrong way around. US deals split roughly 50/50 on whether buyer can claim for breach of a warranty it knew about pre-signing. The template carries a pro-sandbagging provision as default.

Negotiation Timeline From Term Sheet to Completion

Phase	Days	Key Activities	Owner
Term sheet / LOI	Day 0 to 14	Headline price, structure, exclusivity, diligence access	Principals, advisors
Due diligence	Day 14 to 60	Legal, financial, tax, commercial, IT, ESG diligence	Buyer-side advisors
First SPA draft	Day 30 to 45	Buyer counsel drafts; uses template as starting point	Buyer counsel
Seller mark-up	Day 45 to 60	Seller counsel returns first mark-up; major commercial points raised	Seller counsel
Reps and warranties	Day 60 to 90	Disclosure letter drafted; warranties narrowed	Seller counsel, target management
R&W insurance underwriting	Day 45 to 90	Underwriter diligence call; quote; bind	Broker, underwriter
Final negotiation	Day 90 to 105	Open points list; principal-to-principal escalation	Principals, counsel
Signing	Day 105 to 110	Disclosure schedules finalized; signing call	All parties
Pre-completion	Day 110 to 220	Regulatory clearances, third-party consents, financing	All parties
Completion	Day 220 to 260	Closing checklist; funds flow; share transfer	All parties

Source: 2023 ABA Private Target M&A Deal Points Study; 2024 SRS Acquiom Market Practice Survey.

Jurisdiction Considerations and How the Template Connects to Valuation

Delaware is the default US choice: Delaware General Corporation Law and Court of Chancery expertise give predictable enforcement, no transfer tax, more than 70% of US private M&A deals select Delaware governing law per the 2024 SRS Acquiom study. New York is frequently chosen where buyer counsel is New York-based; NY courts are more willing to enforce broad reps and pro-sandbagging provisions, and NY’s choice-of-law statute (NY General Obligations Law Section 5-1401) allows parties to choose NY law for transactions over $250,000 without requiring a NY nexus. California presumptively voids non-competes under Section 16600 with the Section 16601 sale-of-business exception, and California-resident sellers face California source tax on accelerated equity comp under California Revenue and Taxation Code Section 17041. England and Wales: Companies Act 2006 governs share transfer mechanics, stamp duty at 0.5% on share consideration above GBP 1,000, and English courts respect properly drafted entire-agreement clauses per BSkyB v EDS [2010] EWHC 86 (TCC). BVI and Cayman are used as topcos for cross-border deals where the parties want neutral incorporation jurisdiction; share transfers are fast and inexpensive but the template needs to nominate the governing law (typically English) and forum (typically LCIA arbitration or the BVI Commercial Court).

The SPA is the final document, but price and structure are determined long before the first draft. For valuation work that flows into SPA negotiation, see the discounted cash flow business valuation and DCF valuation business sale 2026 guides. For PE buyers, the LBO model step-by-step guide walks how model output sets the maximum offer price that becomes the headline number in clause 3, and the paper LBO example walkthrough shows the back-of-envelope version PE associates run before any SPA is drafted. For underlying valuation, see how to determine the value of a business; for careers building these models, see the private equity analyst career guide. For the side-by-side comparison of US “stock purchase agreement” terminology versus international “share purchase agreement” usage, see the what is a stock purchase agreement guide.

TLDR: Share Purchase Agreement Template Key Takeaways

A share purchase agreement template is the reusable starting form for transferring 100% of the issued shares of a private company, applicable to UK Companies Act 2006 companies, Delaware corporations, S-corps with Section 338(h)(10) elections, and offshore holding companies.
Eleven moving parts; six of them (warranties, limitations, tax covenant, working capital adjustment, MAC, no-shop) drive 90% of the economic outcome.
Median 2024 terms: 10% escrow, 1% basket (deductible), 10-20% cap on general warranties, 100% cap on fundamentals and tax, 18-24 months general warranty survival, 7-year tax indemnity, 24-36 months non-compete.
R&W / W&I insurance covers 71% of US private deals over $50 million and 87% of UK deals over EUR 75 million. Where insured, seller indemnity cap drops to a 0.5% to 1% retention.
Section 338(h)(10) bridges the share-sale vs asset-sale tax gap for US S-corps and consolidated-group subsidiaries.
The MAC clause turned into the central legal question of the pandemic era; carve-outs need disproportionate-impact qualifiers and the ordinary-course covenant needs a pandemic-response carve-out.
UK SPAs use locked-box (68% of European deals); US SPAs use completion accounts (89%). The template carries both mechanics with alternative bracketed language.
QSBS Section 1202 exclusion and 280G shareholder vote are template add-ons founders and selling executives should always check before signing.
The cost of getting clause 8 wrong on a $50 million deal is larger than the cost of every lawyer on the transaction combined; pay qualified securities, tax, and cross-border counsel to adapt the template before you sign.

Share Purchase Agreement Template: 2026 Free SPA Template With Drafting Guide