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A Preliminary Sale and Purchase Agreement is commonly used in Saudi Arabian property transactions as an initial binding document between parties intending to enter into a final property sale. This document is particularly important in the Saudi Arabian context, where property transactions must comply with both Sharia principles and modern commercial law requirements. It typically includes key transaction terms, due diligence requirements, deposit arrangements, and conditions precedent to the final sale. The agreement serves to protect both parties' interests during the pre-completion phase while ensuring compliance with local property regulations, including those relating to foreign ownership, property registration, and anti-money laundering requirements. It's especially relevant for complex commercial transactions where detailed due diligence is required before proceeding to final sale.

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

2. Background: Context of the transaction and brief description of the property and parties' intention to enter into a final sale and purchase agreement

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

4. Subject Matter: Detailed description of the property being sold, including all relevant legal identifiers and registration details

5. Purchase Price and Payment Terms: Agreed purchase price, deposit amount, payment schedule, and method of payment in compliance with Sharia principles

6. Conditions Precedent: Conditions that must be satisfied before proceeding to final sale, including due diligence, approvals, and documentation requirements

7. Due Diligence: Scope of buyer's due diligence rights and seller's obligations to provide information and access

8. Timeline and Steps to Completion: Timeline for satisfying conditions precedent, conducting due diligence, and executing final agreement

9. Representations and Warranties: Preliminary representations by both parties regarding capacity, authority, and property status

10. Deposit Provisions: Terms governing the payment, holding, and potential refund or forfeiture of the deposit

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

12. Governing Law and Jurisdiction: Confirmation of Saudi law application and jurisdiction of Saudi courts

13. Notices: Process and addresses for formal communications between parties

14. Execution: Signature blocks and execution requirements