Purchase agreement

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(Redirected from Stock purchase agreement)

Purchase agreement also is known as sale and purchase agreement - the parties (sellers and buyers) in this contract will agree the terms of the agreement -method of payment (shares, cash, other assets), price, purchased assets, and other details that are intended to both explain transactions as well as protecting seller and buyer against risk [1].

Most important information

Buy/sell agreement is concluded between seller and buyer to set terms, forth the price, and circumstances in which the seller agrees to sell and the buyer agrees to purchase. The arrangement will identify the seller and buyer by their right addresses and names. The contract will include information on the price and payment method, whether in cash or another source of financing. Other relevant conditions also should be included in the contract. Any unforeseen situations on the part of the Buyer, for example, subject to collateral for financing, will be specified in the contract. Seller warranties such as all operating systems and any other conditions were related to title or property will be specified in the contract. The agreement includes other elements, such as a specific embodiment, the closing date, the amount of the deposit, and the date of the pursuit [2].

Types of purchase agreement

Of the purchase agreements can be distinguished [3] [4] [5]:

  • The share purchase agreement documents the contract between the parties and covers all guarantees, conditions precedent, damages, remuneration, implementation arrangements, restrictive covenants, and other issues.
  • Purchase order, sometimes referred to as a purchase contract, takes place after the supplier selection has been completed. Be particularly careful when purchasing because it is a legally binding document. Almost all orders contain standard legal terms on the reverse of the contract. The order contains detailed information, about the purchase, material specification, quantity, price, quality requirements, delivery date, delivery method, shipping address, purchase order number, and date of the order. This information, as well as the name and address of the buyer company, is on the front page. From a legal point of view, the transfer of an order is a contractual offer, and the confirmation by the supplier constitutes a contractual acceptance. The acceptance and offer are two keys elements of a legally binding contract.
  • Bond purchase or purchase contract, in a negotiated sale, the purchase agreement between the lender and the issuer is called a bond purchase contract (BPA). The BPA includes the principal of each maturity, the purchase price of the bond, interest rates, and other transaction details. It also includes the estimated closing date, statements, and guarantees that the issuer submits to the underwriter, and the conditions under which the guarantor will or will not have to collect the bonds.


  1. E.Talmor, F.Vasvari. 2011.
  2. B.Roark, R.Roark. 2012. p.113
  3. E.Talmor, F.Vasvari. 2011.
  4. R.M. Monczka et al. 2009. p.65
  5. Sifma. 2012. p.78

Purchase agreementrecommended articles
Contract noteConfirmed letter of creditAuthorised dealerDelivery NoticeBack-To-Back Letters Of CreditCollecting bankContra dealTransferable letter of creditPayment against documents


Author: Magdalena Domalik