Out now: Clyde & Co podcast series 2.2
Giovanna Cabbia, Clyde & Co Partner discusses the most common form of sale and purchase agreement…
This second series of Clyde & Co podcasts seeks to demystify the process of buying a superyacht. Yacht brokers, family office advisers, bankers, and senior Clyde & Co lawyers join superyacht industry commentator John Leonida to discuss every aspect of buying a superyacht. We hope you enjoy listening.
In episode two, Giovanna Cabbia, Clyde & Co Partner and head of the firm’s superyacht team discusses the most common form of sale and purchase agreement used in selling and buying previously owned superyachts.
As discussed by Cabbia and Leonida, The Mediterranean Yacht Brokers Association sale and purchase contract, also known as the MYBA MOA is the most commonly used form of contract in superyacht acquisition. Although it is a pre-printed document and may appear standard, every deal has its unique features, and as a consequence, the MYBA MOA will need to be supplemented.
Typically, at least two addenda are needed for the MYBA MOA. The first to reflect the regulatory uniqueness of each superyacht and the legal and tax profile surrounding each superyacht. That is the list of documents a seller needs to deliver when the yacht is sold, and that includes the proof that the person selling or buying the superyacht has the legal power to do so. The other addendum covers all the commercial aspects of the deal which the generic standard form does not cover.
For example, are there any pre-booked charters that need to be transferred, and are there any items that are not included in the sale? What about scheduled repairs? Are there repair works to be completed by the seller before the completion of the sale? These kinds of issues must be clearly understood by everyone. Also, any understandings or arrangements made verbally need to be put in writing.
Sometimes, however, presumptive superyacht buyers will only seek legal advice after they have signed what they think is the standard contract that everyone signs. This is a common set of circumstances for Giovanna Cabbia who comments:
“Well, sadly that often happens because clients get overexcited. They want to get on with the deal and lock in the transaction, but ultimately it really depends on how bad the contract is and then we would try to renegotiate whatever is prejudicial to them or find a way to renegotiate the terms at a second stage when you enter into the sea trial and condition survey phase, because the MYBA MOA does have a mechanism that allows to, in effect, renegotiate terms of the sale”
Please see the link to the full podcast episode here.
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