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Carry out points a) and b) above
[STANDARD ESTATE AGENCY TERMS AND CONDITIONS No. 6 09/11 – REAL ESTATE Draft A – [Name of the estate
agency]/… [author]…[date] – Sale and purchase of real estate and any shares of a title-holding company. The estate
agency has checked neither issues relating to direct or indirect taxes, nor accounting issues. These are to be reviewed by
the advisors of the parties and, if applicable, the auditors of the Seller or the Title-Holding Company. The Seller has made
any sale, hereunder the terms and conditions thereof, as well as contracts, etc., conditional upon the consent of its Board
of Directors, cf. also Clause 10]
SALE AND PURCHASE AGREEMENT
between
The Seller
and
The Purchaser
Relating to sale and purchase of
The Property
The Property, Land no. Land no. and Title no. Title no.
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1.
SALES OBJECT
[…] AS, enterprise registration no. [..] (the “Seller”), is the owner of the property
• land no. [..], title no. [..], with its existing buildings and facilities, in the municipality of [..] (the
“Property”).
The Seller and [..] AS, enterprise registration no. [..] (the “Purchaser”), agree that the Property
shall be transferred from the Seller to the Purchaser on the terms and conditions set out in
this contract.
[If Title-Holding Company:
The Seller is also the owner of the company
• [.. ] AS, enterprise registration no. [..] (the “Title-Holding Company”),
which is registered in the Register of Land Titles and Land Charges as titleholder for the
Property. The parties agree that 100% of the shares of the Title-Holding Company shall be
transferred to the Purchaser under this contract on the terms set out in the Terms and
Conditions for the Sale and Purchase of Shares enclosed as Appendix 10.]
2.
THE PURCHASE PRICE AND THE PAYMENT THEREOF
2.1
The Purchase Price
The Purchase Price of the Property shall be NOK [..] (the “Purchase Price”).
The Purchase Price shall be paid by Closing, cf. Clause 6, and otherwise in conformity with
closing instructions pursuant to Clause 2.4.
2.2
Costs/stamp duty
The Purchaser shall, in addition to the Purchase Price, pay stamp duty and title deed
registration fee. These costs shall be paid, of the Purchaser’s own accord, together with the
Purchase Price in accordance with Clauses 2.1, 2.3 and 2.4.
[If a Title-Holding Company is to be acquired, the above paragraph shall be replaced by the
following:
The Title-Holding Company holds title to the Property, and the Purchaser has decided, since
the Purchaser is acquiring 100% of the shares of the Title-Holding Company, that no title deed
shall be registered in connection with the transaction.]
2.3
Late payment interest
Late payment shall be governed by the Act relating to Late Payment Interest.
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2.4
Closing, hereunder corporate law dispositions
The parties agree that closing of the transaction, hereunder the transfer of ownership of the
Property, shall be effected pursuant to a separate set of closing instructions to be prepared by
the parties prior to Closing. [The closing instructions are enclosed as Appendix 9.]
The Seller shall assign guarantees/deposits securing the performance of lease obligations to
the Purchaser as per Closing.
[If a Title-Holding Company is in existence, the above paragraph shall be replaced by the
following:
The parties agree that closing of the transaction, including the transfer of ownership of the
Property, hereunder the transfer of ownership of the shares of the Title-Holding Company,
shall be effected pursuant to a separate set of closing instructions to be prepared by the
parties prior to Closing. [The closing instructions are enclosed as Appendix 9.]]
2.5
Value Added Tax – assignment of adjustment/reversal obligations and rights
The parties agree that the adjustment/reversal obligations and rights of the Seller in relation
to the Property shall be assigned to the Purchaser as per Closing. A separate agreement on
the assignment of the duty/right to adjust/reverse Value Added Tax (the “Adjustment
Agreement”), complying with the requirements pertaining to such assignment under the
applicable Value Added Tax provisions, cf. Appendix 11, shall therefore be concluded
simultaneously with the conclusion of this contract. The information in the Adjustment
Agreement shall be updated as per Closing. The adjustment/reversal obligations, as well as
any adjustment rights, have been taken into consideration in calculating the Purchase Price,
cf. Clause 2.1.
[Whether the prerequisites for the assignment of adjustment obligations and rights are met,
and whether this provision shall in such event be inserted, needs to be evaluated in each
individual case. What effect the assignment of these obligations/rights should have on the
purchase price needs to be examined specifically by the parties. Consequently: The proposed
wording is intended as an example that will often be suitable – but circumstances always have
to be evaluated on an individual basis.]
3.
THE SELLER’S LIABILITY FOR DEFECTS
The Property is acquired “as is” as per the date of the Purchaser’s prior survey/inspection.
Section 3-9 of the Sale of Real Estate Act shall be deviated from for purposes of any
assessment of defects, thus implying that a defect can only be invoked:
• if the Seller fails to meet its specific obligations under this contract;
• if the Seller fails to meet its disclosure obligation, cf. the regulations set out in Section 3-7 of
the Sale of Real Estate Act; or
• if the Seller has rendered incorrect information, cf. the regulations set out in Section 3-8 of
the Sale of Real Estate Act.
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This implies that the risk relating to any hidden errors as set out in Section 3-9, last sentence,
of the Sale of Real Estate Act lies with the Purchaser.
As far as concerns reports from third parties concerning the Property (technical reports, land
analyses, appraisals, etc.) that have been enclosed with this contract and/or disclosed by the
Seller in connection with the transaction, the Seller is unaware of any errors or omissions in
these documents. However, should the documents in any event be found to contain any
errors or omissions, the principles laid down in Section 3-7 and Section 3-8 of the Sale of Real
Estate Act shall be deviated from, with the Seller only being liable for any errors of which the
Seller did have factual knowledge.
The Purchaser shall under no circumstance be entitled to invoke any incorrect specifications
of the surface area (external or internal) of the Property as giving rise to any claim for
defective performance.
The regulations in the present Clause have been taken into consideration by the parties when
determining the Purchase Price.
4.
THE SELLER’S REPRESENTATIONS AND WARRANTIES
The Seller represents and warrants that the following will apply to the Property as per Closing,
however so that the guarantees in letters (c) to (f) inclusive apply at the signing of the
contract:
(a)
That the Seller owns [and holds title to] the Property;
(b)
That the encumbrance situation of the Property will be as set out in Appendix 3,
subject, however, to mortgages marked “x” in Appendix 3 being de-registered in
connection with closing of the transaction.
(c)
That the Seller is not aware of the existence of any written order, etc., from
government authorities in relation to the Property that has not be complied with,
paid or similar.
(d)
That the Property is leased as stated in Appendix 6.
(e)
That the Seller is not aware of any claims or rights that limit the use or utilisation of
the Property beyond what follows from the Land Titles and Land Charges of the
Property or the zoning plan and zoning regulations applicable to the Property and the
entries recorded in respect of the Property.
(f)
That the activities on the Property will, during the period from signing of this contract
until Closing, be pursued in the customary manner, hereunder that no material
agreements will be concluded, terminated for breach, amended or terminated
without cause, and that, during the same period, no other decisions of material
importance to the Property will be made without the written consent of the
Purchaser.
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5.
LIMITATION OF LIABILITY IN RESPECT OF DEFECTS AND IN RESPECT OF THE
REPRESENTATIONS AND WARRANTIES
The Purchaser shall not be entitled to make any form of claim against the Seller, hereunder
any claim in respect of the representations and warranties under Clause 4, in relation to
circumstances that the Purchaser became aware of, or ought to have become aware of, in
connection with its due diligence investigation of the Property prior to the signing of this
contract.
The right of the Purchaser to invoke breach of contract (hereunder any breach of the
representations and warranties under Clause 4 shall lapse if the Purchaser fails to notify the
Seller, within a reasonable period of time after it discovered, or ought to have discovered, the
breach of contract, to the effect that the breach of contract will be invoked, as well as of the
scope of the breach of contract. No claim for breach of contract, or other type of claim against
the Seller, can under any circumstance be invoked by the Purchaser more than 1 year after
Closing, however so that the time limit shall be extended from 1 year to 3 years for breaches
of warranties that comprise Clause 4(a).
The Seller shall not be liable to the Purchaser in respect of indirect loss (cf. the principles laid
down in Section 7-1 (2) of the Sale of Real Estate Act). Loss of rent income (hereunder loss of
any right to the reimbursement of joint costs) shall, nevertheless, be defined as a direct loss.
The aggregate liability of the Seller in respect of payments in the form of damages or price
reductions shall not exceed NOK [..].This limitation of liability does not apply by breach of the
warranties in Clause 4(a). The Purchaser may under no circumstances invoke any claim against
the Seller unless the aggregate price reduction and damages claimed exceed NOK [..]. Any
individual claim for less than NOK [..] shall be disregarded for purposes of determining
whether the aggregate claim exceeds the minimum threshold. The claims shall nevertheless
be covered from the first NOK if the aggregate claim exceeds the minimum threshold. The
claims of the Purchaser shall be calculated on a net basis, after deduction of any tax savings
that the Purchaser will be able to benefit from.
The regulations in this Clause 5 do not imply any curtailment of the right of the Purchaser to
terminate for breach pursuant to the general legal provisions governing this contract.
[The following provisions may be considered for inclusion if there are many Sellers:
The owners defined as the Seller under this contract shall be jointly and severally liable for any
claims against the Seller. [Alternatively: The owners defined as the Seller under this contract
shall be liable for any claims against the Seller on a pro rata basis, and not jointly and
severally. The liability of each individual owner shall not exceed a portion of the claim equal to
its ownership stake in the Property.]
NOK [..] of the Purchase Price shall be kept outside the control of both parties, in an escrow
account in the name of the Seller, throughout the period during which a claim for breach of
contract may be invoked (1 year from Closing), as collateral securing any claim made by the
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Purchaser against the Seller under this contract. Any rightful claims the Purchaser may have
against the Seller shall be settled by payment from such account. If no rightful claim is made
against the Seller by the expiry of the period during which a claim for breach of contract may
be invoked, the amount deposited in the said account, inclusive of interest, shall be paid to the
Seller. A dispute as to what constitutes a rightful claim shall be resolved by arbitration, cf.
Clause 12.]
6.
CLOSING
The Purchaser shall take delivery of the Property at 12:00 noon on [...] (“Closing”).
The Seller reserves the right to terminate for breach in the cases governed by Section 5-3 (4)
of the Sale of Real Estate Act.
7.
INCOME AND COSTS ASSOCIATED WITH THE PROPERTY
The Seller shall be entitled to any income generated by the Property until the date on which
the Purchaser takes possession of the Property. The Seller shall pay any costs associated with
the Property until the same date.
The Seller and the Purchaser shall, no later than [..], settle any income and expenses relating
to the Property as per Closing directly between themselves.
8.
INSURANCE
The Property shall be kept insured by the Company until Closing, pursuant to the enclosed
Certificate of Insurance (Appendix 7).
If any damage to the Property occurs during the period until Closing, and
• the costs associated with reconstruction/repair and any loss of rent are fully covered by the
Company’s insurance policy (or other insurance policies); and
• all lessees at the Property confirm that they will resume their leases on the same terms and
conditions following reconstruction/repair;
the Seller may decide that the Purchaser shall not be entitled to invoke such damage as a
defect.
9.
PUBLIC LAW REGULATIONS
The Purchaser assumes the risk associated with all potential public law claims in relation to
the completion of the transaction, hereunder any government license requirements.
As far as competition law issues are concerned, the following has been specifically agreed:
This contract may be subject to a notification requirement pursuant to Section 18 of the
Competition Act. The Purchaser shall in such event notify the transaction within [..] days of
the signing of this contract. The parties acknowledge that the Norwegian Competition
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Authority may impose a requirement for complete notification of the transaction pursuant to
Section 18, Sub-section 3, of the Competition Act.
The parties agree, in the event that the acquisition is subject to a notification requirement
pursuant to Section 18 of the Competition Act, that Closing shall be postponed until the
automatic implementation prohibition in Section 19, Sub-section 1 or 3, of the Competition
Act has been lifted, with the addition of one week for practical preparation of the
implementation of Closing, without any of the parties being entitled to invoke any claim
against the other party in relation to such postponement.
The risk of any competition law sanctions shall, apart from the above, be borne by the
Purchaser in its entirety, cf. the main rule in the first paragraph above. If, for example, the
Norwegian Competition Authority makes acquisition by the Purchaser subject to conditions or
orders the Purchaser to sell the Property, such circumstances shall be of no relevance to the
Seller – and shall in no way limit the obligations of the Purchaser towards the Seller.
10.
COMMUNICATIONS
Any communications in connection with this contract shall be made by registered letter,
telefax or e-mail to the following addresses:
For the Seller: [...]
For the Purchaser: [...]
11.
CONDITIONS PRECEDENT
The signature of the Seller on this contract is conditional upon the approval, by its Board of
Directors, of the transaction, hereunder the terms and conditions and this contract. If the
Seller does not notify the Purchaser to the effect that it has obtained such approval by [..] at
12.00 noon, all rights and obligations of both parties under the contract shall lapse. None of
the parties may in such case make any claim for reimbursement of costs or otherwise against
the opposite party.
[Potential wording if subsequent due diligence investigation:
The Purchaser shall, for a period ending at 12:00 noon on [..], conduct a technical, financial
and legal due diligence investigation. The Purchaser has itself defined, for that purpose, which
documents it would like to inspect – Appendix 8.
If the Purchaser finds, during the said period, that the Property deviates from the information
provided on the part of the Seller and from that enclosed with this contract, it may, by 12:00
noon on [..], relinquish all rights and obligations under this contract (terminate this contract).
In such event, none of the parties shall be entitled to invoke any claim for the reimbursement
of costs or claim any other compensation from the other party. The Purchaser shall not be
entitled to invoke any other remedies against the Seller in respect of any circumstances of
which the Purchaser became aware, or ought to have been aware, in the context of the due
diligence investigation, thus implying, inter alia, that it shall not be entitled to invoke any
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breach of representations and warranties, or any defects, pursuant to Clauses 3 and 4 as an
alternative to termination (cf. also the provisions of the next paragraph).
If the Purchaser does not exercise its right to terminate pursuant to the above paragraph, the
liability of the Seller for defects/the right of the Purchaser to invoke breach of contract shall in
all respects be governed by Clauses 3, 4 and 5, provided, however, that any circumstances that
the Purchaser became aware of, or ought to have become aware of, in the context of its due
diligence investigation cannot subsequently form the basis for any claim against the Seller.]
12.
GOVERNING LAW AND DISPUTE RESOLUTION
All matters relating to this contract shall be governed by Norwegian law.
Any dispute that may arise in relation to this contract shall be resolved by arbitration pursuant
to the Act of 14 May 2004 relating to Arbitration. The arbitral tribunal shall comprise three
members, of whom the parties shall appoint one arbitrator each. These shall appoint the third
arbitrator, who shall be the Chairperson of the arbitral tribunal. The Chairperson of the
arbitral tribunal shall be a Norwegian lawyer. In the absence of agreement as to the identity of
the third arbitrator, such arbitrator shall be appointed by the Chief District Court Judge of the
Oslo District Court.
The arbitration shall take place in [..], and the language of arbitration shall be Norwegian.
The arbitral proceedings shall be deemed to have commenced when one party sends a
request to the opposite party to the effect that the dispute be resolved by arbitration. The
arbitration proceedings and the ruling of the arbitral tribunal shall be subject to a duty of
confidentiality, and the parties shall be obliged to conclude, as soon as the arbitral
proceedings have commenced, a separate agreement confirming this.
13.
APPENDIX
The following are appended:
1.
Transcript from the Register of Business Enterprises – the Seller [Overview of the “Seller” –
transcripts from the Register of Business Enterprises, etc.]
2.
Transcript from the Register of Business Enterprises – the Purchaser
3.
Transcripts from the Register of Land Titles and Land Charges
4.
Leases, with Appendices
5.
Prospectus
6.
Certificate of Measurement
7.
Certificate of Insurance
8.
[The Purchaser’s list of documents relating to due diligence investigation]
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9.
[Closing instructions]
10.
[Terms and Conditions for the Sale and Purchase of Shares]
11.
[Adjustment Agreement]
14.
SIGNATURE
This contract is signed on this day, in triplicate, of which the parties and [name of the estate agency]
shall retain one each.
[Place], on [date]
for and on behalf of [Seller]
for and on behalf of [Seller]
Name:
Name:
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[Appendix if sale and purchase of title-holding company:
APPENDIX 1
(APPENDIX 10 – TERMS AND CONDITIONS FOR THE SALE AND PURCHASE OF SHARES (ALL DEFINITIONS SET OUT IN
THE CONTRACT FOR THE SALE AND PURCHASE OF REAL ESTATE SHALL APPLY)
1
Background
The Seller has on this date concluded an agreement for the transfer of ownership of 100% of the
shares of the Title-Holding Company to the Purchaser (the “Shares”). The Title-Holding Company
shall, as mentioned in the Contract for the Sale and Purchase of Real Estate, hold registered title to
(but not the right of ownership of) the Property as per Closing.
The provisions of Clause 5 of the Contract for the Sale and Purchase of Real Estate shall also apply to
these Terms and Conditions for the Sale and Purchase of Shares. Likewise, the principles expressed in
Clause 3 of the Contract for the Sale and Purchase of Real Estate shall also apply to these Terms and
Conditions for the Sale and Purchase of Shares.
2
Purchase Price and the payment thereof
The parties agree that the Seller shall, during the period until Closing, make the corporate law
dispositions necessary to ensure that the Title-Holding Company has only one asset on its balance
sheet (the “Balance Sheet”) as per Closing, in the form of an unrestricted cash deposit in the
approximate amount of NOK 100,000 in an account with a Norwegian bank in the name of the TitleHolding Company. The Title-Holding Company shall have no liabilities.
The Purchase Price shall be equal to the cash deposit as specified above, and shall be paid as per
Closing as specified under Clause 2.1 above (the “Purchase Price”).
3
The Seller’s representations and warranties
The Seller represents and warrants that the following will apply as per Closing:
(a)
That the Title-Holding Company holds title to the Property (not the right of
ownership thereof).
(b)
That the Title-Holding Company holds full and unrestricted title to all assets entered
on the Balance Sheet.
(c)
That the Title-Holding Company has no debts or other financial liabilities, hereunder
tax liabilities of any type.
(d)
That the financial statements of the Title-Holding Company are correct and based on
generally agreed accounting principles.
(e)
That the Title-Holding Company has not rendered any guarantee or furnished any
security for the benefit of the liabilities of any third party.
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(f)
That the Title-Holding Company has no employees, and no pension obligations as
against the Seller or anyone else.
(g)
That the Title-Holding Company is not party to any legal proceedings or other legal
dispute.
(h)
That the Seller holds, as per the transfer of ownership, full and unrestricted title to
the Shares, that the share capital of the Title-Holding Company is fully paid up, that
the Shares are transferred free of any encumbrances of any type, and that the Shares
are not subject to any rights of first refusal or other pre-emptive rights.
(i)
That no distributions on the Shares, or other wholly or partly gratuitous transfers, to
shareholders or anyone else, have been resolved, other than those reflected in the
Estimated Balance Sheet.
(j)
That no rights relating to the Shares (hereunder dividend rights, pre-emptive rights,
etc.) have been separated from the Shares.
Closing
The Purchaser shall, provided that Closing with regard to the transfer of ownership of the Property
takes place, also acquire the Shares as per Closing against payment of the Purchase Price in
accordance with the closing instructions prepared by the parties, cf. Clause 2.4 of the Contract for
the Sale and Purchase of Real Estate.”]
[Appendix if assignment of adjustment/reversal obligations and rights pursuant to Clause 2.5 of the
Contract for the Sale and Purchase of Real Estate:
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APPENDIX 2
AGREEMENT ON TRANSFER OF
ADJUSTMENT/REVERSAL OBLIGATIONS
BETWEEN
[NAME OF SELLER]
AND
[NAME OF PURCHASER]
1
The Parties
This agreement is made on [date] between
2
(a)
[Seller], [address]. [postal code and place], organisation no. [ ] (the “Seller”)
(b)
[Purchaser], [address]. [postal code and place], organisation no. [ ] (the “Purchaser”)
Background
The Seller and the Purchaser have on this date concluded an agreement to the effect that ownership
of the Property shall be transferred from the Seller to the Purchaser. The parties agree, in connection
therewith, that the adjustment/reversal obligations and rights of the Seller with regard to input
Value Added Tax relating to the Property shall be assigned to the Purchaser as per Closing, cf.
Clause 2.5 of the Contract for the Sale and Purchase of Real Estate.
3
Adjustment/reversal obligations that are transferred
The adjustment/reversal obligations and rights relating to the Property as per Closing are as follows:
[Insert specification of the completed construction measures]
Completion date/acquisition date
[Date]
Acquisition cost net of Value Added Tax
NOK [..]
Total Value Added Tax
NOK [..]
Value Added Tax deducted by the Assignor
NOK [..]
Right of deduction on the part of the Assignor as per the acquisition date
[..]%
Right of deduction on the part of the Assignor as per Closing
[..]%
Right of deduction on the part of the Assignee as per Closing
[..]
Annual adjustment amount
NOK [..]
(Any remaining adjustment amount on the part of the Assignor)
NOK [..]
Assigned adjustment obligation
NOK [..]
[Insert one table for each of the construction measures if there are several of these]
[State how [… sett inn tekst…]
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Other provisions
The parties agree that the Seller shall, upon request, hand over to the Purchaser copies of any
documentation necessary to enable the Purchaser to exercise any right of adjustment, hereunder
copies of appendices relating to the information in the Adjustment Agreement.
The Purchaser represents and warrants, by signing this Adjustment Agreement, that it is, as per
Closing, a business enterprise registered in the Value Added Tax Register, and has such right to
deduct input Value Added Tax as specified in the table(s) above.
[Place], on [date]
for and on behalf of [Seller]
for and on behalf of [Seller]
Name:
Name:
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