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Preliminary Purchase Agreement for Nigeria

Preliminary Purchase Agreement Template for Nigeria

A Preliminary Purchase Agreement under Nigerian law serves as an initial binding framework that outlines the key terms and conditions for a proposed purchase transaction. This document establishes the groundwork for subsequent negotiations and due diligence, while committing parties to negotiate in good faith toward a definitive agreement. It incorporates essential elements of Nigerian contract law and commercial practice, including provisions for due diligence, conditions precedent, and timeline for completion. The agreement typically includes protections for both parties during the preliminary phase and may contain exclusivity and confidentiality provisions where appropriate.

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Preliminary Purchase Agreement

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What is a Preliminary Purchase Agreement?

The Preliminary Purchase Agreement is a crucial document in Nigerian commercial transactions, serving as a bridge between initial negotiations and the final purchase agreement. It is typically used when parties have reached agreement on key commercial terms but require a formal structure for further due diligence and detailed negotiations. The document reflects Nigerian legal requirements and commercial practices, incorporating essential elements such as party identification, subject matter description, preliminary price arrangements, and conditions for proceeding to a definitive agreement. This type of agreement is particularly important in the Nigerian context where business relationships often require formal documentation of preliminary commitments before proceeding with detailed due diligence and final negotiations.

What sections should be included in a Preliminary Purchase Agreement?

1. Parties: Identification and details of the seller and purchaser

2. Background: Context of the transaction and relationship between the parties

3. Definitions: Definitions of key terms used throughout the agreement

4. Subject Matter: Description of the asset or business to be purchased

5. Purchase Price: Preliminary agreement on purchase price or pricing mechanism

6. Due Diligence: Terms and process for conducting due diligence investigation

7. Timeline: Key dates and deadlines for the transaction process

8. Conditions Precedent: Conditions that must be satisfied before proceeding to definitive agreement

9. Good Faith Negotiations: Commitment to negotiate definitive agreements in good faith

10. Costs and Expenses: Allocation of costs and expenses during the preliminary phase

11. Governing Law and Jurisdiction: Specification of Nigerian law as governing law and jurisdiction for disputes

12. Execution: Signature blocks and execution formalities

What sections are optional to include in a Preliminary Purchase Agreement?

1. Exclusivity: Used when seller agrees not to negotiate with other parties during the preliminary phase

2. Confidentiality: Used when not covered by a separate NDA, to protect confidential information exchanged

3. Break Fee: Used in larger transactions to specify fees payable if either party withdraws

4. Deposit: Used when an initial deposit is required to demonstrate commitment

5. Warranties: Used for basic warranties about capacity to contract and ownership

6. Force Majeure: Used when specific events might affect the preliminary agreement period

7. Assignment: Used when rights under the preliminary agreement might need to be assigned

What schedules should be included in a Preliminary Purchase Agreement?

1. Asset Schedule: Detailed description of assets to be purchased

2. Due Diligence Requirements: List of documents and information required for due diligence

3. Timeline Schedule: Detailed timeline with specific milestones and deadlines

4. Price Calculation: Details of how the purchase price will be calculated if complex

5. Required Approvals: List of regulatory or third-party approvals needed

6. Form of Definitive Agreement: Outline or key terms of the proposed final purchase agreement

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 | Serial Founder & Legal AI Author

Jurisdiction

Nigeria

Document Type

Sale Agreement

Cost

Free to use
Relevant legal definitions






































Clauses






























Relevant Industries

Manufacturing

Real Estate

Oil and Gas

Technology

Retail

Agriculture

Financial Services

Telecommunications

Mining

Construction

Healthcare

Transportation

Energy

Consumer Goods

Relevant Teams

Legal

Finance

Mergers & Acquisitions

Corporate Development

Business Development

Risk & Compliance

Executive Leadership

Commercial Operations

Investment

Due Diligence

Relevant Roles

Chief Executive Officer

Managing Director

Chief Financial Officer

Legal Counsel

Corporate Lawyer

Business Development Manager

Mergers & Acquisitions Director

Commercial Director

Investment Manager

Chief Operating Officer

Company Secretary

Finance Director

Contract Manager

Risk Manager

Compliance Officer

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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