Agreement to Sell: Understanding the Basics

agreement to sell

In a fast-paced business world, companies are looking for a fundamental tool to manage risk and secure profitable deals. One solution to this is an agreement to sell.

An agreement to sell plays a significant role in the sales industry. It helps in providing clarity and protection for any types of transactions–from small-scale purchases to large-scale business deals.

In this article, we will help you understand the basics of this agreement that will surely boost the success of your sales venture.

What Is an Agreement to Sell?

An agreement to sell is a legal agreement that details the terms and conditions of a sale between a buyer and a seller. The agreement includes crucial information such as:

  • the price;
  • payment schedule;
  • delivery date; and
  • other pertinent information.

Both the buyer and the seller are obligated to comply with the agreement. This ensures that the buyer will purchase the product or service at the agreed-upon price. Meanwhile, also making sure that the seller will provide the product or service according to the specified conditions.

This agreement is essential to ensure clarity and interpretation to both sides. Moreover, it is essential to have this in place to assure a much greater turnout in business deals.

The Importance of an Agreement to Sell

An agreement to sell is vital for multiple reasons primarily:

  • It outlines the sale’s terms and conditions. One major significance of this agreement is its assurance of clarity for the buyer and seller. With this document, a clear expectation is drawn between parties, which helps in preventing unnecessary costs in case of conflicts.
  • It establishes a binding contract between parties. Parties are held accountable for complying with the agreed-upon specifics. This also provides a layer of protection for both parties as it provides legal recourse when violations arise.
  • It mitigates risks and secures deals. An agreement to sell helps in the negotiation and acceptance of a deal that is mutually beneficial. Additionally, it safeguards the seller’s intellectual property rights and guarantees that they receive payment for their goods or services.
agreement to sell

Key Elements of an Agreement to Sell

It’s important to ensure that all elements of an agreement to sell are included and clearly defined to avoid any misunderstandings or legal issues. They are the following:

  • Parties: The agreement to sale should contain necessary details about both parties involved like their names and contact information.
  • Subject matter: The agreement should also outline the subject matter of the sale, which includes a specific description of the product or service being sold.
  • Price: Price is an important variable that must be agreed upon by both parties. And this should be properly stated along with any applicable taxes or fees in the agreement to sell.
  • Payment terms: It should also declare the terms for payment, from the amount and timing of payments, to any penalties for late or missed payments.
  • Delivery and transfer of ownership: The agreement must clearly detail the specifics of delivery and transfer of ownership, as well as the delivery method and timing.
  • Representations and warranties: It is crucial that the seller provide clear warranties or representations about the product’s quality, condition, and legal ownership.
  • Indemnification and liability: Both parties must specify which will be held accountable for any damages or liabilities arising from the sale.
  • Governing law and jurisdiction: The agreement should also identify which laws and jurisdictions will apply in the event of a conflict in sales.

Agreement to Sell Examples

There are different examples of agreement to sell that are specific to each situation in various industries. The following are some of the agreement to sell examples.

Real estate purchase agreement

As the name suggests, this agreement is definite for a property’s sale. It indicates the terms and conditions, including the purchase price and closing date. It should also declare any requirements that need to be fulfilled before the sale can be finalized.

Vehicle purchase agreement

A vehicle purchase agreement is a contract between a buyer and seller to sell a vehicle. This legal contract details all the information about the vehicle, the purchase price, and any warranties or guarantees provided by the seller.

Purchase order

On the other hand, a purchase order is a legal agreement between a buyer and seller for the purchase of goods or services. A purchase order includes details of the items or services being purchased, the purchase price, and the delivery schedule.

Artwork purchase agreement

If it involves the purchase of an artwork, an artwork purchase agreement is helpful in sale. This agreement details all information about the artwork, from the artist’s name, title, and medium. Also, it states the price the artwork was bought and any warranties provided by the seller.

Business purchase agreement

This is a legal contract for the sale of a business. A business purchase agreement clearly outlines the terms of the sale: the purchase price, closing date, and any contingencies needed for sale.

Dispute Resolution in an Agreement to Sell

Disagreements are common even when an agreement to sell is present in a deal. Instances may arise about the terms and conditions of the agreement. This is where a dispute resolution will be helpful in resolving disputes in a legally binding manner.

It is important for these legal agreements to contain provisions about dispute resolution to prevent any unnecessary issues. These provisions will detail the actions that the parties need to take to fix the conflict.


This is the most common method when settling disputes, wherein a neutral third party facilitates the discourse between the parties. The aim of mediation is finding a mutually acceptable way in fixing the conflict. This is quicker and more cost-effective than going to court and helps maintain the business relationship of parties.


Arbitration is another possible resolution for conflicts. This is done with an independent third party to listen to the dispute, and then make a sound and legal decision from it. This is a more formal approach than mediation and can be more convenient for some in terms of cost and duration instead of going to court.


Finally, the agreement to sell may also contain a clause or provision that requires the parties to try to resolve any conflicts through negotiation before resorting to mediation or arbitration.

agreement to sell

Best Practices When Drafting Agreement to Sell

Drafting an agreement to sale can be a complex process for any business. Thankfully, there are a few best practices to consider when creating a legally enforceable and comprehensive agreement.

Define the parties involved

Identifying the parties is the first on the list for a reason. You should be able to specify the information of the buyer and seller from full names, and contact information, to the legal statuses of both. With this, there is less to no confusion when enforcing the contract.

Include a dispute resolution

You should know that in order to safeguard your business in case a conflict happens is through a dispute resolution. It is imperative that a method for resolving issues is included in the provisions of the agreement to sell. This clarifies that both parties fully understand their rights regardless of whether a conflict arises or not.

Insert applicable legal provisions

Relevant laws and regulations should be complied with by both parties once the agreement has been signed. Provisions in the contract like indemnification clauses or limitations of liability should be added to assure the legality and validity of the document.

Use clear and concise language

Avoid any technical jargons that may create confusion with the other party. That is why the language used must be straightforward. After all, you are ensuring that both parties fully comprehend the agreement’s terms and conditions.

Seek legal advice

Do not be shy to ask for legal advice from professionals who are knowledgeable in terms of these legalities. Ask everything you need to ask–from the contract’s provisions, legality and enforceability, to certain ambiguous terms.

Draft Agreements With Fill Efficiently

Looking for an easy way to create a legally binding agreement to sell? Look no further than the Fill app–your all-in-one platform for hassle-free contract management. We offer a variety of features, including:

  • Creating a contract. Our integrated solution can assist you in generating contracts that can be legally enforced. This is possible because Fill complies with all relevant regulations and standards related to using electronic signatures.
  • A repository of contract templates. Fill has a comprehensive library of pre-made templates of agreements and templates that you can use. This makes it easier to modify with its templated legal terms and conditions that you can edit accordingly.
  • eSignature capabilities. Save time while ensuring legality in terms of your electronic signature. With Fill, you can easily create a digital signature in a few seconds. You can also track and request signatures while using your own device.
  • Secure cloud storage. Fill lets you access different contracts from anywhere at any time. You can rest assured that all your files are protected and are not lost in transit. Everything you need is stored in your cloud.

Invest in a tool like Fill that is trusted by many and is proven effective in delivering results.

Craft a contract or use an agreement template with Fill. Save the hassle and sign up for free today.

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