Posted in Marketing and Strategy Terms, Total Reads: 376
Definition: Sales And Purchase Agreement
The legal agreement that defines and lists the terms and obligations for a buyer to buy a product or service, and seller to sell the same is known as a sales and purchase agreement. SPA represents the outcome of transactions involving real estates, change of property of an asset, share or capital adjustments.
SPAs attempts to account for finalizing the best interest of both the parties before closing the deal as originally stipulated in the letter of intent (LOI).
SPA helps the suppliers and purchasers to predict demands and costs and become more important as the magnitude of the deal increases. The final document is binding and usually finalized only after due diligence from both the supplier and buyer side as neither of them can turn their back to the legal document of SPA.