Share transfer and debt restructuring agreement is a legal arrangement between two entities where in one entity owes money to the other entity and the creditor agrees to acquire some shares in the debtor organization and in return agrees to give some relaxation in the debt and restructure the debt to aid growth of the company.
It is a typical debt restructuring exercise with the only difference being that the creditor opts to acquire share in the debtor company which may not necessarily be a controlling stake and in return agrees to restructure the debt of the company with some significant relaxations such waiver of interest or a part of the loan amount and increased flexibility in repayment terms.
This agreement not only records the specific details of the share transfer transaction but also articulates the details on debt restructuring exercise such as waivers given to debtor, the new terms and conditions of repayment, the penalties in case of failure to adhere to the new terms and conditions.
[Also Read: Debt Restructuring Agreement]
Sample for Share Transfer and Debt Restructuring agreement
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