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Documentation

Preliminary agreements

What preliminary agreements are commonly drafted?

A confidentiality agreement and a letter of intent.

Principal documentation

What documents are required?

The following documents are required:

  • an offer document – this document will include certain mandatory mentions provided by the Takeover Bids Law of May 19 2006;
  • the decision to make the bid and the offer document;
  • disclosures from the bidder to the Financial Sector Supervisory Commission (CSSF) with respect to securities acquired during the acceptance period; and
  • share purchase agreements for the transfer of securities

Which side normally prepares the first drafts?

The offeree company’s counsel normally prepares the first draft, but there is no strict rule in that regard.

What are the substantive clauses that comprise an acquisition agreement?

An acquisition agreements comprises:

  • the number and details of securities (including the rights and obligations attached thereto) which are offered or acquired);
  • the related representations, warranties and undertakings;
  • indemnification provisions;
  • the purchase price;
  • the governing law and jurisdiction; and
  • the notification and acceptance of the sale and transfer of securities by the target. 

What provisions are made for deal protection?

Provisions made for deal protection include:

  • representations;
  • warranties;
  • undertakings and indemnification provisions; and
  • confidentiality measures.

Closing documentation

What documents are normally executed at signing and closing?

Share purchase and transfer agreements for the transfer of securities and a shareholders’ agreement if applicable are normally executed at signing and closing.

Are there formalities for the execution of documents by foreign companies?

No, not from a legal point of view. The documents could also be signed as counterparts.

Are digital signatures binding and enforceable?

Yes, however, this is not yet a common way to proceed with this kind of transaction. In general, the parties proceed using PDF copies of the executed documents. 

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