Business Sale Contract for Germany

Business Sale Contract Template for Germany

A comprehensive legal agreement governed by German law that documents the sale and purchase of a business, whether through asset or share transfer. The contract addresses all essential aspects of the transaction including asset identification, purchase price, warranties, employee transfers under §613a BGB, tax matters, and post-completion obligations. It incorporates specific requirements of German commercial and civil law, including detailed provisions for employee protection, warranty obligations, and competition law compliance. The document serves as the primary transaction document and includes various schedules detailing assets, employees, contracts, and other crucial business elements.

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What is a Business Sale Contract?

The Business Sale Contract (Unternehmenskaufvertrag) is a crucial document used in German M&A transactions for transferring ownership of a business from one party to another. It is essential for transactions involving both asset deals (Asset Deal) and share deals (Share Deal) under German law. The document must comply with requirements of the German Civil Code (BGB), Commercial Code (HGB), and various other regulations including employment law (particularly §613a BGB for employee transfers), competition law, and tax legislation. It is typically used in situations ranging from small business acquisitions to large corporate transactions, requiring careful consideration of asset transfer, employee rights, warranty provisions, and regulatory compliance. The contract should be drafted with particular attention to German-specific legal requirements, including form requirements that may necessitate notarization.

What sections should be included in a Business Sale Contract?

1. Parties: Identification of the seller and purchaser with full legal details

2. Background: Context of the transaction and brief description of the business being sold

3. Definitions: Defined terms used throughout the agreement

4. Sale and Purchase: Core transaction terms including the business assets being transferred

5. Purchase Price: Purchase price, payment terms, adjustments, and escrow arrangements

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

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

8. Completion: Process and requirements for closing the transaction

9. Warranties: Seller's representations and warranties about the business

10. Liability and Indemnification: Scope of liability and indemnification obligations

11. Employee Matters: Treatment of employees and related obligations under §613a BGB

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

13. Confidentiality: Confidentiality obligations and permitted disclosures

14. Non-Competition: Non-compete and non-solicitation provisions

15. Governing Law and Jurisdiction: Confirmation of German law application and jurisdiction

16. General Provisions: Standard boilerplate clauses including notices, amendments, and severability

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

1. Real Estate: Specific provisions for transfer of real estate assets, used when real property is part of the sale

2. Intellectual Property: Detailed IP transfer provisions, used when significant IP assets are involved

3. Environmental Matters: Environmental warranties and indemnities, used for businesses with environmental risks

4. Data Protection: GDPR and data transfer provisions, used when significant personal data is involved

5. Transition Services: Post-completion service arrangements, used when seller will provide ongoing support

6. Earn-out Provisions: Performance-based additional payments, used when part of purchase price is contingent on future performance

7. Bank Financing: Provisions related to external financing, used when purchase is bank-financed

8. Regulatory Approvals: Additional regulatory requirements, used for regulated industries

What schedules should be included in a Business Sale Contract?

1. Asset Schedule: Detailed list of all assets included in the sale

2. Excluded Assets: List of assets explicitly excluded from the sale

3. Employee List: Complete list of employees with key employment terms

4. Material Contracts: List and copies of important business contracts

5. Real Estate Details: Property descriptions and related documentation

6. Intellectual Property Register: List of all IP rights including registrations

7. Completion Deliverables: List of documents required at completion

8. Warranties: Detailed warranties schedule

9. Encumbrances: List of all encumbrances on business assets

10. Financial Statements: Recent financial statements and management accounts

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Germany

Publisher

Genie AI

Document Type

Purchase Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Manufacturing

Technology

Retail

Professional Services

Industrial

Healthcare

Real Estate

Financial Services

Automotive

Energy

Telecommunications

Hospitality

Construction

Logistics

Media and Entertainment

Relevant Teams

Legal

Finance

Mergers & Acquisitions

Corporate Development

Tax

Human Resources

Compliance

Risk Management

Business Development

Integration

Strategy

Relevant Roles

Chief Executive Officer

Chief Financial Officer

General Counsel

Head of Mergers & Acquisitions

Corporate Development Director

Finance Director

Legal Director

Business Development Manager

Integration Manager

Due Diligence Manager

Transaction Manager

Risk Manager

Compliance Officer

Tax Director

HR Director

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,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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