Free Auction Reserve Price Agreement Template
Auction Reserve Price Agreement
I. Introduction
A. Parties Involved
This Agreement is entered into between [Your Company Name], an established auction house with years of expertise in art, antiques, and high-value goods, and [Second Party Company Name], a reputable seller known for offering rare and valuable items. Both parties acknowledge the need for this Agreement to formalize the terms and conditions of the auction.
B. Purpose of the Agreement
The purpose of this Agreement is to outline the terms under which [Your Company Name] will auction the [Second Party Company Name]'s items, ensuring a mutual understanding regarding the reserve price and the sale process. [Second Party Company Name] agrees to consign their item(s) with [Your Company Name], and [Your Company Name] will facilitate the sale in accordance with agreed-upon terms.
C. Date of Agreement
This Agreement is effective as of [Date], and will remain in effect until the completion of the auction and all related transactions. Both parties acknowledge their understanding of the terms outlined in this Agreement and agree to adhere to the stipulations set forth.
II. Definitions
A. "Reserve Price"
The "Reserve Price" refers to the minimum price set for each item that [Second Party Company Name] is willing to accept during the auction process. If the highest bid does not meet or exceed the reserve price, the item will not be sold unless otherwise agreed in writing by both parties.
B. "Auction"
The "Auction" refers to the event where the item(s) are offered for public sale, whether physically or online, and where bids are placed by interested buyers. The Auction will be conducted at a location agreed upon by both parties or through an online platform managed by the [Your Company Name].
C. "Item"
The "Item" refers to the tangible or intangible goods that [Second Party Company Name] agrees to auction with the [Your Company Name]. Detailed descriptions and photographs of the item(s) will be provided by [Second Party Company Name], including provenance and any certifications of authenticity where applicable.
III. Reserve Price
A. Agreed Reserve Price
The agreed Reserve Price for the items is $25,000.00 for the Antique Gold Necklace and $50,000.00 for the 18th Century Painting, both of which are to be sold in the upcoming auction. These prices represent the minimum acceptable amounts that [Second Party Company Name] is willing to accept for each item.
B. Confidentiality of the Reserve Price
The Reserve Price shall remain confidential and will not be disclosed to potential bidders prior to or during the auction. This ensures that the bidding process remains competitive and bidders are unaware of [Second Party Company Name]'s minimum price threshold.
C. Method for Adjusting the Reserve Price
Either party may request to adjust the Reserve Price, subject to mutual written agreement. Any changes to the Reserve Price must be submitted in writing at least 48 hours before the auction to allow for proper updates to the auction materials and promotional content.
IV. Auction Terms
A. Auction Date and Time
The auction will take place on [Auction Date] at [Auction Time], and the item(s) will be featured alongside other prestigious items for sale. Both parties agree to adhere to the agreed schedule, ensuring the item(s) are properly presented for potential bidders.
B. Location of the Auction
The auction will be conducted at [Auction Location], or in the case of an online auction, through the [Online Platform Name]. [Your Company Name] will confirm the venue and provide [Second Party Company Name] with any necessary logistical details regarding the auction location and platform.
C. Auction Format
The auction will be held in a hybrid format where interested parties can participate both in person and online. [Your Company Name] will provide detailed instructions on how to place bids online and how to attend the live auction in person.
V. Seller’s Obligations
A. Providing the Item for Auction
[Second Party Company Name] agrees to deliver the item(s) to [Your Company Name] in the condition described, no later than 7 days prior to the auction. [Second Party Company Name] is responsible for ensuring that the item(s) are fully insured during transportation to [Your Company Name].
B. Ownership and Title
[Second Party Company Name] affirms that they are the lawful owner of the item(s) and have full right and title to sell them. The item(s) are free from liens, encumbrances, or any other claims, and [Second Party Company Name] will provide any necessary documentation to support ownership and authenticity.
C. Cooperation with [Your Company Name]
[Second Party Company Name] agrees to cooperate fully with [Your Company Name] in promoting the auction and providing required documentation. This includes agreeing to any promotional materials or marketing that [Your Company Name] deems appropriate to maximize the exposure of the auction items.
VI. Auction House’s Obligations
A. Conducting the Auction
[Your Company Name] will conduct the auction in a professional and transparent manner, ensuring that all bidding rules are strictly followed. [Your Company Name] will oversee the bidding process and manage all related activities, including the collection of bids and the final sale.
B. Promotion of the Auction
[Your Company Name] will actively promote the auction through various channels such as print, online listings, email newsletters, and social media. [Your Company Name] will ensure the item(s) are highlighted effectively to attract potential buyers and generate competitive bidding.
C. Enforcement of the Reserve Price
[Your Company Name] will not allow the item(s) to be sold below the agreed Reserve Price, unless both parties have explicitly agreed in writing to a lower sale price. [Your Company Name] will manage the bidding to ensure compliance with the agreed terms and conditions.
VII. No Sale Clause
A. If Reserve Price Is Not Met
If the bidding does not reach or exceed the agreed Reserve Price, the item(s) will not be sold and will be withdrawn from the auction. [Your Company Name] will inform [Second Party Company Name] promptly of this outcome and arrange for the return of the item(s).
B. Auction House’s Right to Refuse Sale
In the event that the bidding falls below the reserve price, [Your Company Name] reserves the right to refuse to sell the item(s). Any potential sale below the reserve price can only occur if both parties mutually agree in writing to accept the lower bid.
VIII. Seller’s Right to Adjust or Withdraw Item
A. Adjusting the Reserve Price
[Second Party Company Name] may request an adjustment to the Reserve Price if necessary, provided that such a request is made in writing and received by [Your Company Name] at least 48 hours prior to the auction. Any adjustments must be approved by both parties to ensure that all terms are clearly communicated before the auction commences.
B. Withdrawing the Item
[Second Party Company Name] retains the right to withdraw the item(s) from the auction at any time prior to the start of the auction. If [Second Party Company Name] decides to withdraw the item after the auction has begun, they may be responsible for any costs or fees incurred by [Your Company Name] up to that point.
IX. Commission and Fees
A. Auction House’s Commission
[Your Company Name] will receive a commission of 15% of the final hammer price for each item sold. This commission will be deducted from the proceeds of the sale and is due upon completion of the auction.
B. Additional Costs and Fees
[Second Party Company Name]er is responsible for any additional costs related to the auction, including but not limited to catalog production, marketing, insurance, and shipping. Any such fees will be clearly outlined and agreed upon before the auction date.
C. Payment Terms
After the auction, [Your Company Name] will remit the proceeds of the sale to [Second Party Company Name] within 30 days of the auction’s conclusion, less applicable fees and commissions. Payment will be made via bank transfer or other mutually agreed-upon methods.
X. Dispute Resolution
A. Dispute Mechanism
In the event of any disputes arising from this Agreement, both parties agree to resolve the matter through binding arbitration in [State]. Arbitration will be conducted under the rules of the American Arbitration Association (AAA) and the decision of the arbitrator will be final.
B. Governing Law and Jurisdiction
This Agreement shall be governed by the laws of the State of [State]. Both parties consent to the exclusive jurisdiction of the courts in [State] for any legal proceedings related to this Agreement.
XI. Termination
A. Conditions for Termination
This Agreement may be terminated by either party in the event of a material breach by the other party. If the breach is not remedied within 10 days of receiving written notice, the non-breaching party may terminate the Agreement.
B. Consequences of Termination
Upon termination of this Agreement, [Your Company Name] will return the item(s) to [Second Party Company Name], and any outstanding fees or commissions owed will be settled promptly. [Your Company Name] will not be responsible for any damages resulting from the termination of this Agreement.
XII. Miscellaneous Provisions
A. Confidentiality
Both parties agree to maintain the confidentiality of all terms and conditions, including the reserve price and any sensitive business information shared during the term of this Agreement. This confidentiality obligation will survive the termination of this Agreement.
B. Indemnification
[Second Party Company Name] agrees to indemnify and hold harmless [Your Company Name] from any claims, damages, or liabilities arising out of the sale of the item(s). This includes any legal disputes regarding the ownership or authenticity of the item(s).
C. Force Majeure
Neither party shall be held liable for failure to perform its obligations due to events beyond its control, such as acts of God, natural disasters, war, or government regulations. In the event of force majeure, both parties will work to reschedule the auction or find an alternative solution.
XIII. Signatures
By signing below, the parties acknowledge that they have read, understood, and agreed to the terms of this Auction Reserve Price Agreement.
Auction House
[Your Name]
[Your Company Name]
[Date]
Seller
[Second Party Representative Name]
[Second Party Company Name]
[Date]
