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Management Buyout Agreement Template for Nigeria

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Key Requirements PROMPT example:

Management Buyout Agreement

"I need a Management Buyout Agreement for a medium-sized manufacturing company in Lagos, where our 5-person management team will acquire 100% of shares from the current owner for NGN 500 million, with 60% bank financing, to be completed by March 2025."

Document background
The Management Buyout Agreement is a crucial document used when a company's existing management team wishes to acquire ownership from current shareholders in Nigeria. This agreement is particularly relevant for privately-held companies seeking ownership transition while maintaining operational continuity. The document must comply with Nigerian legislation, including CAMA 2020, Investment and Securities Act 2007, and relevant tax laws. It typically includes detailed provisions for share transfer, purchase price mechanics, warranties and representations, conditions precedent, and post-completion obligations. The agreement also addresses financing arrangements, employee matters, and ongoing business operations, making it essential for both small and large-scale corporate transitions in the Nigerian business environment.
Suggested Sections

1. Parties: Identifies the selling shareholders, purchasing management team members, and the target company

2. Background: Sets out the context of the transaction, including current ownership structure and intention to execute management buyout

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes interpretation rules

4. Sale and Purchase: Core transaction terms including what is being sold (shares/assets) and the basic agreement to sell and purchase

5. Purchase Price: Details of the consideration, payment structure, and any adjustments

6. Completion: Specifies the completion mechanics, timing, and actions required at completion

7. Conditions Precedent: Conditions that must be satisfied before completion can occur

8. Pre-Completion Obligations: Obligations of all parties between signing and completion

9. Warranties and Representations: Standard warranties from sellers about the business and from buyers about their capacity to complete

10. Limitations on Liability: Caps, time limits and other restrictions on warranty and indemnity claims

11. Post-Completion Obligations: Ongoing obligations after completion, including transition arrangements

12. Confidentiality: Provisions regarding confidential information and announcements

13. Non-Competition and Non-Solicitation: Restrictions on sellers' future competitive activities

14. Boilerplate Provisions: Standard legal provisions including notices, governing law, and dispute resolution

Optional Sections

1. Financing Arrangements: Required when external financing is part of the transaction structure

2. Employee Matters: Needed when specific employee arrangements or incentive schemes are part of the buyout

3. Intellectual Property Rights: Important when IP is a significant asset requiring specific treatment

4. Tax Covenant: Required for complex tax arrangements or specific tax indemnities

5. Transitional Services: Needed when sellers will provide ongoing services post-completion

6. Earn-out Provisions: Used when part of the purchase price is contingent on future performance

7. Management Agreement: Required when new management arrangements need to be documented

8. Shareholder Reserved Matters: Needed when sellers retain minority stakes with specific voting rights

Suggested Schedules

1. Schedule 1 - Details of the Company: Corporate information, share capital, and subsidiaries

2. Schedule 2 - Sellers and Shareholdings: Details of current shareholders and their holdings

3. Schedule 3 - Properties: List and details of company properties

4. Schedule 4 - Intellectual Property: Details of IP owned or licensed by the company

5. Schedule 5 - Material Contracts: List and details of key business contracts

6. Schedule 6 - Employees: Key employment terms and employee information

7. Schedule 7 - Completion Requirements: Detailed list of completion deliverables

8. Schedule 8 - Warranties: Full set of warranties given by the sellers

9. Schedule 9 - Tax Covenant: Detailed tax indemnity provisions

10. Appendix A - Form of Resignation Letters: Template resignation letters for outgoing directors

11. Appendix B - Form of Board Minutes: Template board minutes for completion

12. Appendix C - Disclosure Letter: Sellers' disclosures against the warranties

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓƵ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions

















































Clauses






































Relevant Industries

Manufacturing

Technology

Retail

Professional Services

Healthcare

Energy

Financial Services

Real Estate

Agriculture

Transportation

Education

Construction

Hospitality

Mining

Telecommunications

Relevant Teams

Legal

Finance

Corporate Development

Executive Leadership

Human Resources

Operations

Risk Management

Compliance

Treasury

Corporate Secretariat

Board of Directors

Mergers and Acquisitions

Relevant Roles

Chief Executive Officer

Managing Director

Chief Financial Officer

Finance Director

Operations Director

Company Secretary

Legal Counsel

Corporate Lawyer

Investment Banker

Financial Advisor

Business Development Director

Human Resources Director

Board Member

Shareholder

Private Equity Manager

Transaction Advisory Manager

Due Diligence Specialist

Corporate Finance Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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