Put and call option agreement

by Practical Law Corporate

A standard document for a put and call option agreement governing the sale and purchase of shares in a private limited company under the laws of England and Wales. This standard document sets out the key terms for granting and exercising both a put option, enabling a seller to require a buyer to purchase the option shares, and a call option, allowing the buyer to compel the sale of the same shares. It details the conditions precedent to exercise, the specific option period for each option, and the formal procedure for serving an exercise notice to trigger completion. The agreement also addresses the calculation and payment of the consideration for the shares and outlines the obligations of each party at completion. It includes important provisions to protect the buyer during the option period, such as restrictions on the seller's ability to deal with the shares. Furthermore, this standard document contains clauses to manage the impact of a corporate reorganisation, warranties from the seller, and a mechanism for expert determination to resolve potential disputes.