Preliminary Purchase Agreement Template for United Arab Emirates

The Preliminary Purchase Agreement is a crucial document in UAE business and property transactions, used when parties have reached initial agreement on key terms but require a formal framework before proceeding to a final purchase agreement. This document, governed by UAE Federal Law No. 5 of 1985 (Civil Code) and relevant Emirate-specific property laws, typically includes essential details such as party information, property/asset description, purchase price, payment terms, due diligence requirements, and conditions precedent. It serves to protect both parties' interests during the preliminary phase while establishing clear obligations and timelines. The agreement is particularly important in the UAE context where property and commercial transactions often involve complex regulatory requirements and multiple stakeholders.

1. Parties: Identification and details of the seller and purchaser, including full legal names, addresses, and registration details if companies

2. Background: Context of the transaction, including brief description of the property/asset and parties' intentions

3. Definitions: Key terms used throughout the agreement, including Property, Purchase Price, Deposit, and Completion Date

4. Subject Matter: Detailed description of the property/asset being purchased and any inclusions/exclusions

5. Purchase Price and Payment Terms: Agreed purchase price, deposit amount, payment schedule, and payment methods

6. Due Diligence: Terms and timeframe for conducting due diligence investigations

7. Conditions Precedent: Conditions that must be satisfied before proceeding to final purchase agreement

8. Timeline and Key Dates: Schedule for key milestones including due diligence period, final agreement signing, and completion

9. Deposit Provisions: Terms regarding the deposit, including amount, timing, and conditions for refund or forfeiture

10. Representations and Warranties: Basic representations by both parties regarding authority to enter agreement and property status

11. Termination Rights: Circumstances under which either party may terminate the preliminary agreement

12. Governing Law and Jurisdiction: Confirmation of UAE law application and relevant court jurisdiction

13. Notices: Process and contact details for formal communications between parties