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Business Sale Contract
When buying or selling a business there are many considerations to take into account. A
successful sale can often depend on the construction of the documentation used to sell the
business, that is, the Contract of Sale. If you are considering buying or selling a business, it is
highly advisable that you engage the help of a solicitor to prepare and negotiate the terms of the
Contract of Sale.
For use in respect of Queensland based business, the Real Estate Institute of Queensland (REIQ)
publishes a standard Business Sale Contract ("Contract"). A copy of the most recent version of
this the Contract can be purchased from the REIQ by telephone (07) 3249 7347 or
www.reiq.com.au
. Alternatively, your solicitor will provide you with a completed copy of the
Contract if you so instruct them.
The Contract is similar to the REIQ Contract for Houses and Land that is commonly used by real
estate agents in the sale and purchase of residential property. Similarly to the REIQ Contract for
Houses and Land, the Business Sale Contract contains standard conditions that can be deleted or
amended as well as the possibility for additional special conditions to be included in the Contract.
Standard features of a REIQ Business Sale Contract
Details of the business being sold
The Contract is commonly prepared by either the Vendor’s or the Purchaser’s solicitor and will
require particulars of the transaction inserted in the Items Schedule. Such particulars include,
amongst other things:
• The details of the business.
• Whether the business is sold on a walk-in walkout-basis and if not sold on this basis, the details
of the stock in trade or work in progress will need to be completed.
• How the purchase price is to be apportioned between the goodwill of the business, fixtures,
fittings and chattels of the business.
• The leasing requirements of the business.
• Any restriction on the vendor’s ability to compete with the business in the future (commonly
referred to as a ’restraint of trade’ clause).
• Any period for which the vendor is required to tutor or assist the purchaser in the operation of
the business.
Standard conditions
Attached to each Contract are several pages of standard conditions that, unless otherwise deleted,
amended or altered by virtue of special conditions, are binding upon each party to the Contract. It
is therefore very important for each party to know what their respective rights, duties and
responsibilities are under these conditions (including any amendments) before they enter into the
Contract.