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Business Sale Contract Template for Nigeria

A comprehensive legal agreement governed by Nigerian law that facilitates the sale and purchase of a business, whether as a share sale or asset sale. The document outlines all aspects of the transaction including the purchase price, payment terms, warranties, indemnities, and completion mechanics. It ensures compliance with Nigerian corporate law, tax regulations, and other relevant legislation while protecting both parties' interests through detailed provisions covering assets, liabilities, employees, and post-completion obligations.

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What is a Business Sale Contract?

The Business Sale Contract is a crucial document used in Nigerian business transactions when one party wishes to sell their business enterprise to another party. This comprehensive agreement is essential for both asset sales and share sales, ensuring compliance with Nigerian legislation including the Companies and Allied Matters Act (CAMA) 2020, relevant tax laws, and employment regulations. The document covers all aspects of the transaction from initial sale terms through to post-completion obligations, including detailed provisions for assets, liabilities, employees, warranties, and indemnities. It's particularly important in protecting both parties' interests while ensuring a smooth transfer of business ownership within the Nigerian legal framework. The contract's structure accommodates various business sizes and complexities, making it suitable for both straightforward and sophisticated business sales.

What sections should be included in a Business Sale Contract?

1. Parties: Identification and details of the seller and buyer, including registration numbers and addresses

2. Background: Context of the sale, brief description of the business, and purpose of the agreement

3. Definitions: Detailed definitions of terms used throughout the agreement

4. Sale and Purchase: Core terms of the business sale, including what is being sold and purchase price

5. Purchase Price and Payment: Detailed payment terms, including payment method, installments if any, and adjustments

6. Conditions Precedent: Conditions that must be satisfied before completion of the sale

7. Pre-Completion Obligations: Seller's obligations in running the business before completion

8. Completion: Details of the completion process, timing, and deliverables

9. Seller's Warranties: Warranties regarding the business, assets, employees, and liabilities

10. Buyer's Warranties: Warranties from the buyer regarding authority and ability to complete the purchase

11. Indemnities: Protection against specific identified risks and liabilities

12. Restrictive Covenants: Non-compete and non-solicitation provisions

13. Confidentiality: Obligations regarding confidential information

14. Employees: Treatment of employees and associated liabilities

15. Tax Matters: Tax-related provisions and allocations of tax liabilities

16. Governing Law and Jurisdiction: Nigerian law as governing law and jurisdiction for disputes

17. General Provisions: Standard boilerplate clauses including notices, amendments, and entire agreement

What sections are optional to include in a Business Sale Contract?

1. Intellectual Property: Required when the business has significant IP assets to be transferred

2. Property Matters: Needed when real property forms part of the sale

3. Environmental Matters: Required for businesses with environmental impacts or liabilities

4. Data Protection: Necessary when the business handles significant personal data

5. Regulatory Compliance: Required for heavily regulated industries

6. Foreign Investment Provisions: Needed when the buyer is a foreign entity

7. Earn-out Provisions: Used when part of the purchase price is contingent on future performance

8. Post-Completion Services: Required when the seller will provide transition services

9. Brand License: Needed when the seller retains brand ownership but grants usage rights

What schedules should be included in a Business Sale Contract?

1. Schedule 1 - Business Assets: Detailed list of all assets included in the sale

2. Schedule 2 - Excluded Assets: List of assets specifically excluded from the sale

3. Schedule 3 - Properties: Details of all real property involved in the sale

4. Schedule 4 - Intellectual Property: List of all IP rights being transferred

5. Schedule 5 - Employee Information: Details of all employees and their terms of employment

6. Schedule 6 - Material Contracts: List of key contracts being transferred

7. Schedule 7 - Warranties: Detailed warranties given by the seller

8. Schedule 8 - Completion Deliverables: List of all documents and items to be delivered at completion

9. Schedule 9 - Permitted Encumbrances: List of permitted liens or encumbrances on assets

10. Appendix A - Completion Accounts: Pro forma completion accounts and adjustment mechanisms

11. Appendix B - Tax Covenant: Detailed tax-related provisions and indemnities

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Nigeria

Document Type

Purchase Agreement

Cost

Free to use

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