What do you mean by unpaid equity balance?

The unpaid balance of equity refers to a part of the equity transfer price agreed in the equity transfer agreement and the unpaid amount. Equity transfer transactions are usually block transactions, and it is often necessary to pay the equity transfer price in installments. The final payment refers to the final equity transfer price, which is also one of the necessary steps to complete the whole transaction. If the final payment of equity is not paid, disputes may arise between the two parties, resulting in the failure to successfully complete the equity transfer.

The unpaid balance of equity is not what both parties want, because it means that the acquirer fails to honor the payment promise, and the seller cannot get all the equity transfer price. In this case, the seller can take corresponding measures to recover the money according to the relevant provisions in the equity transfer agreement. If the problem still cannot be solved, both parties may need to solve the dispute through legal means such as arbitration, which will consume a lot of time and money.

For enterprises, the unpaid equity balance will have a certain impact on their business activities. The change of shareholders' shareholding ratio may lead to the adjustment of ownership structure, and then affect the corporate governance structure and decision-making mechanism. In addition, the unpaid balance of equity may also lead to problems in the financial situation of enterprises, reduce the reputation of enterprises, and even lead to greater risks and losses. Therefore, enterprises must handle equity transactions carefully, get rid of fluky psychology and ensure the security and stability of equity transactions.