Document background
The Pre Purchase Agreement is a critical legal instrument used in Indian business transactions when parties need to formalize their intentions before proceeding with a final purchase. This document is particularly relevant when the transaction requires due diligence, regulatory approvals, or involves complex payment structures. It provides protection to both parties by legally binding them to the proposed transaction while allowing necessary investigations and arrangements to be made. Governed by Indian contract law, the agreement typically includes detailed provisions about the subject matter, payment terms, conditions precedent, and timelines. It's commonly used in real estate transactions, business acquisitions, and large-scale purchase of goods or equipment where significant preparation and verification are required before finalizing the purchase.
