A share is a unit of ownership of the company and the number of shares held by the shareholder represents his or her interest in the company. This agreement includes a buyer and a seller. The buyer wishes to sell his shares in the company to the buyer. The number of shares and the price of those shares would be indicated in the share purchase agreement. Prior to the share purchase agreement, a memorandum of understanding is established and the buyer must perform some due diligence in order to comply with the terms of the memorandum of understanding and the share purchase agreement. The shareholder`s terms should have exactly the same conditions as the memorandum of understanding. If there is a case of mis presentation of warranties and liabilities, then there is appropriate legal action and a remedy or the seller must reimburse the buyer for it. It is considered a less complicated agreement than a contract for the sale of assets.