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Entity Purchase Agreement for Germany

Entity Purchase Agreement Template for Germany

A comprehensive legal agreement governed by German law that documents the terms and conditions for the purchase and sale of a business entity in Germany. This agreement outlines all aspects of the transaction, including purchase price, warranties, representations, conditions precedent, and post-closing obligations. It incorporates specific requirements under German corporate law, including mandatory notarization for GmbH share transfers, and addresses particular aspects of German merger control and commercial regulations. The document serves as the primary transaction document in corporate acquisitions, incorporating both mandatory legal requirements and market-standard provisions for business transfers in the German jurisdiction.

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Entity Purchase Agreement

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What is a Entity Purchase Agreement?

The Entity Purchase Agreement is the primary transaction document used for acquiring businesses in Germany, whether through share deals or the purchase of entire corporate entities. This document is essential when one company wishes to acquire another entity and must comply with German corporate law requirements, including specific provisions of the German Civil Code (BGB), Commercial Code (HGB), and relevant corporate statutes. The agreement typically requires notarization, particularly for GmbH share transfers, and must address specific German law considerations such as liability concepts, warranty restrictions, and merger control requirements. It contains detailed provisions on purchase price mechanics, representations and warranties, conditions precedent, closing mechanics, and post-closing obligations. The document is crucial for ensuring legal certainty in corporate transactions and protecting both parties' interests while maintaining compliance with German regulatory requirements.

What sections should be included in a Entity Purchase Agreement?

1. Parties: Identification of the seller(s), purchaser(s), and any guarantors

2. Background: Context of the transaction and brief description of the target entity

3. Definitions and Interpretation: Defined terms and rules of interpretation for the agreement

4. Sale and Purchase: Core transaction terms including the object of purchase and basic mechanics

5. Purchase Price: Purchase price amount, payment terms, and adjustment mechanisms

6. Closing Conditions: Conditions precedent to closing and related mechanics

7. Closing: Closing mechanics, deliverables, and timing

8. Seller's Warranties: Fundamental and business warranties regarding the target entity

9. Purchaser's Warranties: Basic warranties from the purchaser, including capacity to contract

10. Liability and Indemnification: Indemnification provisions, limitations of liability, and claims procedures

11. Covenants: Pre-closing and post-closing obligations of the parties

12. Tax Matters: Tax representations, indemnities, and allocation of tax liabilities

13. Confidentiality: Confidentiality obligations and permitted disclosures

14. Notices: Format and delivery requirements for formal notices

15. Governing Law and Jurisdiction: Choice of German law and jurisdiction provisions

16. Miscellaneous: Standard boilerplate provisions including severability, amendments, etc.

17. Execution: Signature blocks and execution formalities

What sections are optional to include in a Entity Purchase Agreement?

1. Earn-out Provisions: Include when part of purchase price is contingent on future performance

2. Employee Matters: Include when specific employee arrangements or protections are needed

3. Real Estate: Include when target owns significant real estate assets

4. Intellectual Property: Include when IP assets are material to the transaction

5. Environmental Matters: Include for targets with significant environmental exposure

6. Bank Financing: Include when purchase is contingent on external financing

7. Competition Law Compliance: Include when transaction requires merger control approval

8. Transition Services: Include when seller will provide post-closing services

9. Non-Competition: Include when seller restrictions are required post-closing

What schedules should be included in a Entity Purchase Agreement?

1. Schedule 1: Definitions: Detailed list of defined terms used in the agreement

2. Schedule 2: Target Entity Information: Details of target entity including corporate information and subsidiaries

3. Schedule 3: Warranties: Detailed seller's warranties and any specific disclosures

4. Schedule 4: Properties: List and details of real estate owned or leased by target

5. Schedule 5: Material Contracts: List and summary of material contracts

6. Schedule 6: Intellectual Property: List of IP rights owned or licensed by target

7. Schedule 7: Employees: List of key employees and employment terms

8. Schedule 8: Closing Deliverables: Detailed list of documents required at closing

9. Schedule 9: Purchase Price Adjustment: Detailed mechanics for any price adjustment

10. Schedule 10: Data Room Index: Index of due diligence materials provided

11. Appendix A: Form of Transfer Deed: Form of share transfer document required under German law

12. Appendix B: Closing Minutes: Form of closing minutes and transfer documentation

Authors

Alex Denne

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

Jurisdiction

Germany

Publisher

Ƶ

Document Type

Purchase Agreement

Cost

Free to use
Relevant legal definitions


































































Clauses





















































Relevant Industries

Manufacturing

Technology

Financial Services

Real Estate

Healthcare

Retail

Energy

Telecommunications

Professional Services

Construction

Automotive

Chemical Industry

Media and Entertainment

Logistics and Transportation

Agriculture

Pharmaceuticals

Relevant Teams

Legal

Finance

Corporate Development

Mergers & Acquisitions

Tax

Compliance

Risk Management

Business Development

Strategy

Executive Leadership

Corporate Secretariat

Due Diligence

Relevant Roles

Chief Executive Officer

Chief Financial Officer

General Counsel

Head of Legal

Corporate Lawyer

M&A Director

Investment Manager

Due Diligence Manager

Corporate Development Director

Financial Controller

Tax Director

Compliance Officer

Business Development Director

Integration Manager

Risk Manager

Company Secretary

Board Member

Managing 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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