Stock Terms & Conditions – Perth Stocktaking – Associated Stocktaking
Following is an excerpt from the BBA business sale contract general conditions:
8.1 Unless the agreement is specified to be the sale of the Business on a Walk-in, Walk-out Basis, or unless no value is attributed to stock in the Agreement, the Vendor agrees to sell and the Purchaser agrees to buy the stock of the Business at the value thereof at settlement, subject to the conditions set out in this clause 8.
8.2 Unless the Agreement otherwise provides the estimated value of the Stock as set out in the Agreement shall be paid on the Settlement Date as part of the Purchase Price. Unless the parties agree otherwise, the estimated value of the Stock shall be held in trust by the Vendor’s Representative, or if the Vendor has not appointed a Representative, the Vendor.
8.3 Prior to Settlement, the parties shall endeavour to agree as to the value of the Stock. If the parties cannot reach agreement as to the value of the Stock then the value of the Stock shall be determined by an independent stocktaker in accordance with clause 8.4 below.
8.4 The parties shal endeavour to agree as to the appointment of a stocktaker. In the event that the parties cannot agree as to the appointment of the stocktaker, then a stocktaker shall be appointed at the request of either party by the Western Australian Vice President for the time being of the Stocktakers Institute of Australia Inc. The fee for any stocktaker appointed shall be borne equally by the parties.
8.5 The parties agree that the stocktaker shall make the final decision on the value of the Stock, and shall be entitled to exclude from the value of the Stock any stock that is out of date, unsaleable or unuseable in the Business. The parties acknowledge and agree that the decision of the stocktaker as to the value of the Stock shall be final ad binding upon the parties to the Agreement.
8.6 Upon completion of the stocktake, and upon receiving notification of the result of the stocktake:
- the Vendor’s representative shall release to the Vendor the value of the stock from the monies held in trust, and shall return the balance of funds held (if any) in trust on account of the value of the Stock to the Purchaser;
- if there is no Vendor’s Representative, the Vendor shall be entitled to retain the value of the Stock and shall return the balance of the value of the Stock paid to the Vendor to the Purchaser;
- If the value of the Stock exceeds the estimated value the Purchaser may, by notice to the Vendor at its election:
(i) reject such items as it may select to reduce the value to the estimated value set out in the Agreement; or
(ii) accept the increased value of the Stock and make payment for the balance of the value of the Stock to the Vendor within 2 Business Days of the completion of the stocktake.
- In the event that the Purchaser fails to provide notice as set out in clause 8.6(c) above within 2 Business Days of the completion of the stocktake, the Purchaser shall be deemed to have elected to accept the increased value of the Stock and must make payment as required by clause 8.6(c)(ii).
8.7 The parties hereby irrevocably authorise and direct their Representatives to comply with the terms of this clause 8, and release them from any liability arising out of their compliance with this clause 8.