Sample business merger contract in 2024

Business merger contract in 2024 provides an important strategic opportunity for businesses to optimize resources and improve competitiveness. The merger not only helps increase market share and optimize business processes, but also opens up new opportunities in product and service development. To better understand business merger contracts, the article below will analyze the essential contents in detail.

What is a business merger contract (M&A)?

According to the provisions of Article 201 of the Law on Enterprises 2020, a business merger contract is a legal document expressing the agreement between the parties on the transfer of all assets, rights and obligations. This document establishes the legal relationship between the merging company and the merged company. The merger process will result in the termination of the existence of the merged company.

Merger contracts are often divided into three main forms:

• Horizontal merger: Conducted between businesses in the same industry
• Vertical merger: Applies to businesses in the same supply chain
• Diversified merger: Conducted between businesses in different industries.

Basic content of the Enterprise Merger Contract

Enterprise merger contracts need to include essential contents according to the provisions of law. Contract drafting must comply with the principles of clarity and transparency. Terms need to be expressed specifically to avoid future disputes.

Mandatory contents in the merger contract:

• Legal information of the parties (business name, code, headquarters address);
• Merger procedures and conditions;
• Methods, procedures, deadlines and conditions for converting assets, converting capital contributions, shares, and bonds of the merged company into capital contributions, shares, and bonds of the receiving company;
• Labor use plan;
• Time limit for merger implementation;
• Rights and obligations of the parties;
• Dispute resolution methods.

The contract must have the signature of the legal representative and the seals of the parties. The appendices attached to the contract must be fully listed and have the same legal value as the main contract.

Legal basis: Point a, Clause 2, Article 201 of the Law on Enterprise 2020.

The most standard form of business merger contract

The standard merger contract template needs to comply with the following structure:

SOCIALIST REPUBLIC OF VIETNAM

Independence – Freedom – Happiness

BUSINESS MERGER CONTRACT

​BASE:

1. Enterprise Law No. 58/2020/QH14 and documents guiding its implementation;
2. Pursuant to the Charter ……………………………………………………………;
3. Pursuant to the Charter ……………………………………………………………;
4. Based on the needs of the parties;
5. Relevant legal documents.

This merger contract is made on….month…year…between the following parties:

1. PARTY A

• Business name: ………………………………………………………………………………………………………………
• Business registration certificate number: ……………………………… issued by ………………… on ……………..
• Head office address: ………………………………………………………………………………………………………………
• Phone: ………………………………………. Email: ……………………………………
• Representative: ……………………………………….. Position: ……………………………………

(Hereinafter referred to as “the Merged Party”)

2. PARTY B

• Business name: ………………………………………………………………………………………………………………
• Business registration certificate number: ……………………………… issued by ………………… on ……………..
• Business code: …………………………………………………………………………….
• Head office address: ………………………………………………………………………………………………………………
• Phone: ………………………………………. Email: ……………………………………
• Representative: ……………………………………….. Position: ……………………………………

(Hereinafter referred to as “the Merging Party”)

Each party is hereinafter individually referred to as a “Party”, collectively referred to as the “Parties”.

The Parties wish to link and cooperate to build a strong enterprise in terms of financial potential, scale and competition with partners in the market.

Therefore, now, the Parties hereby agree to sign this contract with the following terms and conditions:

Article 1: Subject of the contract

1. Merged companies:

First company

• Company name: …………………………………………………………………………………………………
• Head office address: …………………………………………………………………………………

Second company

• Company name: …………………………………………………………………………………………………
• Head office address: …………………………………………………………………………………

2. Company receiving merger:

• Company name: …………………………………………………………………………………………………
• Head office address: …………………………………………………………………………………

Article 2. Merger procedures and conditions

…………………………………………………………………………………………………………………

Article 3. Labor use plan

…………………………………………………………………………………………………………………

Article 4. Methods, procedures, conditions and deadlines for converting assets, shares, bonds and capital contributions

…………………………………………………………………………………………………………………

Article 5. Time limit for merger implementation

…………………………………………………………………………………………………………………

Article 6. Approve the draft charter of the merged company

…………………………………………………………………………………………………………………

Article 7. Approval of election of management positions

…………………………………………………………………………………………………………………

Article 8. Rights and obligations of the parties

…………………………………………………………………………………………………………………

Article 9. Commitments and warranties

…………………………………………………………………………………………………………………

Article 10. Modification of contract

…………………………………………………………………………………………………………………

Article 11. Confidentiality

…………………………………………………………………………………………………………………

Article 12. Handling of violations

…………………………………………………………………………………………………………………

Article 13. Dispute resolution

…………………………………………………………………………………………………………………

Article 14. Validity of the contract

…………………………………………………………………………………………………………………

PARTY A’S REPRESENTATIVE                              PARTY B’S REPRESENTATIVE

(Sign, clearly state full name and seal)                 (Sign, clearly state full name and stamp)

>>> Download the most standard form of business merger contract: HERE

Does a business merger contract need to be notarized or authenticated?

According to current regulations, the merger contract is not required to be notarized or authenticated. However, the parties can agree on notarization to increase legality. This is especially important when:

• Large merger value;
• Have assets that are real estate;
• Requests from foreign partners;
• Serves the purpose of bank loans.

Notarization procedures require preparation:

• Original contract;
• Legal documents of the business;
• Company resolution on merger;
• Prove the authority of the signer.

Consulting services and support for drafting business merger contracts in Long Phan

With many years of experience in the field of business consulting, Long Phan will bring the most optimal solution to customers in merger and acquisition activities. Long Phan provides business merger consulting services including:

• Reviewing conditions for merging businesses according to current regulations;
• Consulting and supporting the drafting of contracts and annexes to business merger contracts;
• Appraise the completeness of documents for the merger;
• Representing customers to carry out business registration procedures and change business registration content;
• Consulting on post-merger restructuring plans;
• Resolve problems that arise during the process of merging businesses.

Business merger contracts play a key role in the M&A process, requiring a deep understanding of law and business practices. Long Phan with a team of experienced experts is ready to assist customers in drafting merger contracts in accordance with the law, protecting maximum benefits for businesses. Contact Long Phan immediately via the hotline: 0906735386 for detailed advice.