An agreement for an overseas company to acquire the equity of a domestic company

Legal analysis: foreign investors may acquire the equity of various types of domestic enterprises, but before the acquisition, the domestic enterprise shall, in accordance with the provisions of the relevant national laws and regulations and in accordance with the current examination and approval procedures for foreign-invested enterprises, change and establish as a foreign-invested enterprise after approval, and the foreign-invested enterprise established shall comply with the industrial policy of foreign investment, and if the natural person shareholder of the original Chinese enterprise has not been a shareholder of the original enterprise for more than one year, it may be the investor of the foreign-invested enterprise established after the change.

Legal basis: Company Law of the People's Republic of China

Article 73 When a people's court transfers a shareholder's equity in accordance with the compulsory enforcement procedures prescribed by law, it shall notify the company and all shareholders that the other shareholders have the right of first refusal under the same conditions. If other shareholders do not exercise the right of pre-emption within 20 days from the date of notice from the people's court, they shall be deemed to have waived the right of pre-emption.

Article 74 After the transfer of equity in accordance with Articles 72 and 73 of this Law, the company shall cancel the capital contribution certificate of the original shareholder, issue the capital contribution certificate to the new shareholder, and amend the records of the relevant shareholders and their capital contributions in the articles of association and the register of shareholders accordingly. Such amendments to the Articles of Association do not need to be voted on by the shareholders' meeting.

Article 75 In any of the following circumstances, the shareholders who vote against the resolution of the shareholders' meeting may request the company to acquire their shares in accordance with a reasonable **:

1) The company has not distributed profits to shareholders for five consecutive years, and the company has made profits for five consecutive years and meets the conditions for distributing profits stipulated in this Law;

2) The merger, division or transfer of the main property of the company;

3) The business period specified in the articles of association of the company expires or other reasons for dissolution specified in the articles of association arise, and the shareholders' meeting passes a resolution to amend the articles of association to make the company exist.

If the shareholder and the company cannot reach an equity acquisition agreement within 60 days from the date of the resolution of the shareholders' meeting, the shareholder may file a lawsuit with the people's court within 90 days from the date of the resolution of the shareholders' meeting.

The legal procedures for the acquisition of the equity holder are: 1. Determination of the intention to acquire (signing the letter of intent to acquire). The acquisition of equity interests involves a series of complex legal and financial issues, and the entire acquisition process may take a long time, including the preliminary contact between the two parties and the conclusion of the basic intentions.

2. The acquirer makes an acquisition resolution. After the basic intention of the acquisition is reached, the parties must make proper arrangements for the acquisition. If the acquirer is a company, it needs to convene a general meeting of shareholders and form a resolution on the equity acquisition, and if the authority to acquire is exercised by the board of directors of the company, then the board of directors shall make a resolution on the acquisition, which is the basic document for the company to carry out the acquisition as the acquirer.

If the acquirer is an individual, it is sufficient for the individual to make a direct expression of intent. 3. The target company convenes a general meeting of shareholders, and other shareholders waive their right of first refusal. To successfully complete the acquisition, the shareholders of the target company must convene a general meeting of shareholders on the above matters and form a resolution to expressly agree to the transfer and waive the right of first refusal.

4. Carry out due diligence on the target company and clarify the basic information of the target to be acquired. 5. Sign the acquisition agreement. On the basis of the foregoing, the two parties finally reached an agreement on the acquisition issue and signed the acquisition agreement, and the drafting and signing of the acquisition agreement is the most core part of the acquisition work.

6. Follow-up change procedures. Equity acquisition is different from general trading and inevitably involves changes in shareholders, legal persons, amendments to the articles of association and other issues, and the target company and its shareholders must fulfill the corresponding obligation to assist in the above-mentioned changes and registration procedures.

The process of transferring equity to an offshore company is as follows:

1. Negotiation. The content includes the total amount of the acquisition, payment method, payment period, damages, personnel arrangements after the merger, tax burden, etc. After reaching an agreement on the main aspects, sign the Letter of Intent for M&A;

2. The two parties convene a shareholders' meeting and pass relevant resolutions;

3. Entrust an asset appraisal agency to evaluate the equity to be transferred;

4. Sign the equity transfer agreement;

5. Prepare documents such as articles of association, creditor's rights and debts solutions after the acquisition of overseas equity;

6. Report to the Ministry of Commerce for approval; If the examination and approval authority decides to approve, it shall at the same time send a copy of the relevant approval documents to the foreign exchange administration authority where the equity transferor and the domestic company are located;

7. Within 30 days from the date of receipt of the relevant documents of the overseas enterprise, the investor shall go through the registration procedures with the relevant departments such as taxation, customs, land management and foreign exchange management.

Legal basis]:

Article 71 of the Company Law of the People's Republic of China.

The shareholders of a limited liability company may transfer all or part of their equity to each other.

The transfer of equity by a shareholder to a person other than the shareholder shall be subject to the consent of more than half of the other shareholders. Shareholders shall notify other shareholders in writing to solicit consent for their equity transfer, and if other shareholders do not reply within 30 days from the date of receipt of the written notice, they shall be deemed to have agreed to the transfer. If more than half of the other shareholders do not agree to the transfer, the shareholders who do not agree shall purchase the transferred equity; If you do not purchase it, you will be deemed to have agreed to the transfer.

For the equity transferred with the consent of the shareholders, under the same conditions, other shareholders have the right of first refusal. If two or more shareholders claim to exercise the right of first refusal, they shall negotiate to determine their respective purchase ratios; If the negotiation fails, the right of first refusal to purchase the rift shall be exercised in accordance with the proportion of the capital contribution of each party at the time of transfer.

If the articles of association of the company have other provisions on the transfer of shares, such provisions shall prevail.