VIEWS: 13,964 PAGES: 23 CATEGORY: Selling a Business POSTED ON: 1/11/2010
This is an agreement between a seller of business assets and a buyer. This long-form document sets the terms of such a sale and includes provisions regarding payment, liens and encumbrances on the assets, conditions precedent for the closing, representations of the parties, matters involving third parties, etc. This document is intended to provide standard terms that appear in similar agreements, but it can customized to reflect the needs of the drafting parties.
Asset Purchase Agreement Template This is an agreement between a seller of business assets and a buyer. This long-form document sets the terms of such a sale and includes provisions regarding payment, liens and encumbrances on the assets, conditions precedent for the closing, representations of the parties, matters involving third parties, etc. This document is intended to provide standard terms that appear in similar agreements, but it can customized to reflect the needs of the drafting parties. __________________________ as Seller and ___________________________ as Buyer _____________________________________ ASSET PURCHASE AGREEMENT _____________________________________ ___________________________________ Dated as of _________, 20____ ___________________________________ © Copyright 2013 Docstoc Inc. 1 ASSET PURCHASE AGREEMENT THIS AGREEMENT (the “Agreement”) is dated as of ___________, 20____ by and between _______________________________ (“Buyer”) and ______________________ (“Seller”) collectively referred to as “the Parties”. WITNESSETH: WHEREAS, Buyer desires to acquire, and Seller desires to sell, all of the assets, properties and rights of Seller relating to Seller’s business that are used, necessary or related to the operations of _____________________________________________ (collectively the “Business”), including, without limitation [Instruction: Insert general description of the assets that are subject to this Purchase Agreement] (Purchased Assets”) as more specifically set forth in Schedule A, upon the terms and subject to the conditions set forth in this Agreement (the “Acquisition”). NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: Definitions. The following terms, as used herein, have the following meanings: “Acquisition” is defined in the first recital of the preamble to this Agreement. “Assignment and Assumption Agreement and Bill of Sale” means that certain Assignment and Assumption Agreement and Bill of Sale between Seller and Buyer attached hereto as Exhibit A. “Assumed Contracts” means all contracts, agreements, leases, licenses, commitments, sales, purchase orders and other instruments related to the Business, including, without limitation, as set forth on Schedule____. “Business” is defined in the first recital of the preamble to this Agreement. “Buyer” is defined in the preamble to this Agreement. “Damages” means any losses, amounts paid in settlement, claims, damages, Liabilities, obligations, judgments, settlements and reasonable out-of-pocket costs (including, without limitation, costs of investigation or enforcement), expenses and attorneys’ fees (including reasonable fees and expenses of in-house counsel), including, without limitation, any consequential, special or punitive damages which are assessed as a result of a third party action, in each case, net of any insurance proceeds actually received by Buyer. “GAAP” means generally accepted accounting principles in effect in the United States of America at the time of application thereof, applied on a consistent basis. Unless otherwise specified herein, all accounting terms used herein shall be interpreted, and all determinations with respect to accounting matters hereunder shall be made in accordance with generally accepted accounting principles, applied on a consistent basis. © Copyright 2013 Docstoc Inc. 2 “Liabilities” means any liability or obligation (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated and whether due or to become due), including, without limitation, any liability for Taxes. “Lien” means any mortgage, lien (including any tax lien), pledge, charge, security interest, option, adverse claim, restriction or encumbrance of any kind. “Pre-Closing Tax Period” means (i) any Tax period ending on or before the Closing Date and (ii) with respect to a Tax period that commences before but ends after the Closing Date, the portion of such period up to and including the Closing Date. “Purchased Assets” are specifically listed in Schedule A of this Agreement. “Seller” is defined in preamble to this Agreement. “Tax” means any federal, state, local or foreign income, gross receipts, franchise, estimated, alternative minimum, add-on minimum, sales, use, transfer, registration, value added, excise, natural resources, severance, stamp, customs, duties, real property, personal property, capital stock, social security, unemployment, disability, payroll, license, employee or other withholding, or other tax, of any kind whatsoever, and including any interest, penalties or additions to tax. All other definitions are contained within the relevant provisions herein. PURCHASE AND SALE o Purchase and Sale. On the terms and subject to the conditions of this Agreement, Seller shall sell, convey, transfer, assign and deliver to Buyer, and Buyer shall purchase and accept from Seller on the Closing Date, any and all right, title and interest of Seller in and to any and all of the assets of the Business, including, without limitation, any items as listed as Purchased Assets, wherever such Purchased Assets may be located. o Excluded Assets. Buyer expressly understands and agrees that all assets, properties and rights of Seller not related to the Business (the “Excluded Assets”) shall be excluded from the Purchased Assets and disclosed in Schedule ___. o Assumed and Excluded Liabilities. 1. On the Closing Date, Buyer shall assume and agree to perform the Seller's obligations pursuant to the contracts listed on Schedule ____ (“Assumed Contracts”) (other than Liabilities attributable to any failure by Seller to comply with the terms thereof) but only to the extent such obligations relate to periods after the Closing Date and the other liabilities specified on Schedule _____ as Assumed Liabilities (the “Assumed Liabilities”). 2. Except for the Assumed Liabilities, Buyer shall not assume any Liabilities in connection with the Acquisition or pursuant to this Agreement including, without limitation, the following: © Copyright 2013 Docstoc Inc. 3 a. any Liability for Tax of Seller including, without limitation, any Taxes arising from the operation of the Business or ownership of Purchased Assets on or prior to the Closing Date; provided, however that Apportioned Obligations shall be paid in the manner set forth in Section 5.06; b. any Liability relating to any employees of Seller including, without limitation, any liabilities or obligations under any employee plans or benefit arrangements [If this provision is applicable describe the employee plans or benefit arrangements]; c. any Liability of the Business arising on or prior to the Closing Date including, without limitation, under Assumed Contracts included in the Purchased Assets; d. any Liability relating to any action, suit, arbitration, investigation or proceeding against the Business or with respect to the Purchased Assets arising from events occurring on or prior to the Closing Date; and e. any Liability relating to an Excluded Asset. (collectively, the “Excluded Liabilities”) o Assignment of Contracts and Rights. Notwithstanding anything to the contrary in this Agreement, this Agreement shall not constitute an agreement to assign any Purchased Asset or any claim or right or any benefit arising thereunder or resulting therefrom if an attempted assignment thereof, without consent of a third party thereto, would constitute a breach or other contravention thereof or in any way adversely affect the rights of Buyer or Seller thereunder. Seller will use its commercially reasonable efforts (but without any payment of money by Seller or Buyer) to obtain the consent of the other parties to the assignment of any such Purchased Asset or claim or right or any benefit arising thereunder or resulting therefrom for the assignment thereof to Buyer as Buyer may request. If such consent is not obtained, or if an attempted assignment thereof would be ineffective or would adversely affect the rights of Buyer thereunder so that Buyer would not in fact receive all such rights, Seller and Buyer will cooperate in a mutually agreeable arrangement under which Buyer would obtain the benefits and assume the obligations thereunder in accordance with this Agreement, including, without limitation, subcontracting, sub-licensing, or subleasing to Buyer, or under which Seller would enforce for the benefit of Buyer, with Buyer assuming Seller’s obligations, any and all rights of Seller against a third party thereto. Seller will promptly pay to Buyer when received all monies received by Seller under any Purchased Asset or any claim or right or any benefit arising thereunder, except to the extent the same represents an Excluded Asset. Notwithstanding the foregoing, to the extent that such rights and benefits have not been provided to Buyer by alternate arrangements satisfactory to Buyer, in its sole discretion, Buyer and Seller shall negotiate in good faith for a downward adjustment in the Purchase Price paid by Buyer for the Purchased Assets. © Copyright 2013 Docstoc Inc. 4 o Purchase Price; Allocation of Purchase Price. 3. The purchase price for the Purchased Assets shall be ____________________ dollars ($______________) (“Purchase Price”). The Purchase Price shall be paid by wire transfer or by ______________________ of immediately available funds on the Closing Date or ____________________________. 4. As soon as practicable after the Closing, Buyer shall deliver to Seller a statement (the “Allocation Statement”), allocating the Purchase Price among the Purchased Assets in accordance with Section 1060 of the Internal Revenue Code. If within ten (10) days after the delivery of the Allocation Statement Seller notifies Buyer in writing that Seller objects to the allocation set forth in the Allocation Statement, Buyer and Seller shall use commercially reasonable efforts to resolve such dispute within twenty (20) days. In the event that Buyer and Seller are unable to resolve such dispute within twenty (20) days, Buyer and Seller shall jointly retain a nationally recognized accounting firm (the “Accounting Referee”) to resolve the disputed items. Upon resolution of the disputed items, the allocation reflected on the Allocation Statement shall be adjusted to reflect such resolution. The costs, fees and expenses of the Accounting Referee shall be borne equally by Buyer and Seller. 5. Seller and Buyer agree to (i) be bound by the Allocation Statement and (ii) act in accordance with the Allocation Statement in the preparation, filing and audit of any tax return (including filing Form 8594 with its federal income Tax return for the taxable year that includes the date of the Closing). o Closing. The closing (the “Closing”) of the purchase and sale of the Purchased Assets hereunder shall take place at the offices _____________________ on ________________, 20_____ at ______a.m./ p.m., or at such other time or place as Buyer and Seller may agree (the “Closing Date”). Seller is not required to be physically present at the Closing. o Transfer. As soon as practical after the Closing, but in no event more than ten (10) days after the Closing Date, Seller shall deliver physical possession of all of the Purchased Assets to Buyer. REPRESENTATIONS AND WARRANTIES OF SELLER Seller hereby represents and warrants to Buyer as follows: o Organization and Qualification. Seller has been duly organized and is validly existing and in good standing under the laws of the State ____________ and has the requisite corporate power and authority and all necessary government approval to own, lease and operate its properties and to carry on its business as it is now being conducted. [Assuming seller is a registered business entity} o Corporate Authorization. The execution, delivery and performance by Seller of this Agreement to which it is a party, and the consummation by Seller of the transactions contemplated hereby and thereby are within Seller’s respective corporate powers and have been duly authorized by all necessary corporate action on the part of Seller. This Agreement to © Copyright 2013 Docstoc Inc. 5 which Seller is a party have been duly executed and delivered by Seller, and constitute valid and binding agreements of Seller enforceable against Seller in accordance with their respective terms. o Non-Contravention. The execution, delivery and performance by Seller of this Agreement to which Seller is a party do not and will not: (i) contravene or conflict with the corporate charter or bylaws of Seller; (ii) contravene or conflict with or constitute a violation of any provision of any law or regulation, judgment, injunction, order or decree binding upon or applicable to Seller, the Business or the Purchased Assets; (iii) result in the creation or imposition of any Lien on any Purchased Asset, other than permitted liens; or (iv) constitute a material default under or give rise to any right of termination, cancellation or acceleration of any material right or obligation of Seller relating to the Business or the Purchased Assets or to a loss of any material benefit to the Business or the Purchased Assets to which Seller is entitled under any provision of any material agreement, contract or other instrument binding upon Seller or by which any of the Purchased Assets is or may be bound. o Required Consents. Schedule ____ sets forth each Assumed Contract or permit requiring a consent, waiver, authorization or approval as a result of the execution, delivery and performance of this Agreement or the consummation of the transactions contemplated hereby and thereby (each such consent, a “Required Consent”). o Absence of Certain Changes. Since ___________________20____, Seller has conducted the Business in the ordinary course consistent with past practices, and: 6. Seller has not entered into any material transaction or incurred any material Liability with respect to the Business or the Purchased Assets other than in the ordinary course of business consistent with past practice; and 7. There has not been any material adverse change in the Purchased Assets or the condition (financial or otherwise) of the Business. o Personal Property. 8. The Purchased Assets include the items specified in Schedule A. 9. The equipment [If applicable] included in the Purchased Assets has no material defects, is in good operating condition and repair, has been reasonably maintained consistent with standards generally followed in the industry (giving due account to the age and length of use of same, ordinary wear and tear excepted) and is suitable for its present uses in connection with the Business. 10. No Purchased Asset is subject to any Lien, except for the following (collectively, the “Permitted Liens”): a. liens for Taxes not yet due or being contested in good faith; © Copyright 2013 Docstoc Inc. 6 b. liens for inchoate mechanics’ and materialmen’s liens for construction in progress and workmen’s, repairmen’s, warehousemen’s and carriers’ liens arising in the ordinary course of the Business; or c. liens and imperfections of title the existence of which would not materially adversely affect the use of the property subject thereto. o Sufficiency of Purchased Assets; Operation of Business. The Purchased Assets, constitute all of the assets, properties and rights necessary, and are sufficient, to conduct the Business as currently conducted. o Title to Purchased Assets. Upon consummation of the transactions contemplated hereby, Buyer will have acquired good and marketable title in and to, or a valid leasehold interest in (to the extent not owned by Seller prior to the Closing Date), each of the Purchased Assets, free and clear of all Liens, except for Permitted Liens. o Litigation. There is no action, suit, arbitration, investigation or proceeding pending against or, to the best of Seller’s knowledge, threatened against or affecting the Business or any Purchased Asset before any court or arbitrator or any governmental body, agency or official except as listed on Schedule ____. o Contracts. 11. Except for the Assumed Contracts or any agreements, contracts or commitments disclosed in Schedule _____, Seller is not a party to or subject to any of the following agreements, contracts or commitments relating to the Business or necessary or useful for the operation of the Business or ownership of the Purchased Assets: a. any real property lease; b. any contract for the purchase of materials, supplies, goods, services, equipment or other assets providing for annual payments by Seller or pursuant to which in the last year Seller paid in the aggregate $10,000 or more; c. any sales, distribution or other similar agreement providing for the sale by Seller of materials, supplies, goods, services, equipment or other assets that provides for annual payments to Seller of, or pursuant to which in the last year either Seller or any Affiliate thereof received in the aggregate, $10,000 or more; d. any partnership, joint venture or other similar contract arrangement or agreement; e. any contract relating to indebtedness for borrowed money or the deferred purchase price of property (whether incurred, assumed, guaranteed or secured by an asset); © Copyright 2013 Docstoc Inc. 7 f. any material license agreement, franchise agreement or agreement in respect of similar rights granted to or held by Seller; g. any agency, dealer, sales representative or other similar agreement; h. any agreement, contract or commitment that substantially limits the freedom of Seller to compete in any line of business including, without limitation, the Business, or with any Person or in any area or to own, operate, sell, transfer, pledge or otherwise dispose of or encumber any Purchased Asset or that would so limit the freedom of Buyer after the Closing Date; i. any agreement, contract or commitment which is or relates to an agreement with or for the benefit of any Affiliate of Seller; or j. any other agreement, contract or commitment not made in the ordinary course of business consistent with past practice which is material to the Business or relates primarily to the Purchased Assets. 12. Each Assumed Contract or any agreement, contract or commitment required to be disclosed on Schedule _____ is a valid and binding agreement of the parties thereto and is in full force and effect, and neither Seller nor any other party thereto is in default in any material respect under the terms of any such Assumed Contract or such agreement, contract or commitment nor has any event or circumstance occurred that, with notice or lapse of time or both, would constitute any event of default thereunder. Neither the execution of this Agreement nor the consummation of the transactions contemplated hereby or thereby will result in or cause the breach of any Assumed Contract. o Licenses and Permits. Seller possesses all material permits, licenses and approvals (the “Permits”) necessary or used in order to carry on the Business or own the Purchased Assets. Schedule ____ hereto sets forth all Permits. Except as set forth on Schedule _____ hereto, Seller is in compliance in all respects with all Permits; there are no proceedings pending or, to the best of Seller’s knowledge, threatened, to revoke, suspend, cancel or modify any Permit and all such Permits may be assigned to Buyer as contemplated hereby without the consent of the issuing authority. Seller does not know of any reason why Buyer will not be able promptly to obtain all Permits necessary in order to carry on, or to use the current Permits in, the Business or to own the Purchased Assets. o Compliance with Laws. Neither Seller nor the Business is in violation in any material respect of any applicable law, regulation, ordinance, order or any other requirement of any governmental body or court (including, without limitation, matters relating to securities, loans, employment and improper payments), and no notice has been received by Seller or the Business or any of their respective officers or directors alleging any such violation. o Receivables. All accounts, notes receivable and other receivables included in the Purchased Assets are, and all accounts and notes receivable arising from or otherwise relating to © Copyright 2013 Docstoc Inc. 8 the Business on or prior to the Closing Date will be, valid and genuine and arose in the ordinary course of business consistent with past practice. o Employees; Labor Matters. 13. Neither Seller nor any Affiliate of Seller has incurred any Liability (contingent or otherwise) under Title IV of ERISA or Section 412 of the Code, and no facts exist which could reasonable form a basis for such Liability. No Employee Plan is a “multiemployer plan,” as defined in Section 3(37) of ERISA, nor has Seller or any Affiliate thereof at any time contributed to or been obligated to contribute to any “multiemployer plan.” o Intellectual Property. 14. Schedule _____ contains a complete and correct list of all trademarks, trade names, service marks, service names, copyrights domain names and patents (“Intellectual Property”) included in the Purchased Assets, which Seller has ownership rights in or has a valid right to use, license or sublicense in connection with or which relates to the Business of the Company, and identifies all registration and application numbers, the owner of record and jurisdiction pertaining thereto. The Intellectual Property identified on Schedule _____ is valid, subsisting, unexpired, in proper form and enforceable and all renewal fees and other maintenance fees which have fallen due on or prior to the effective date of this Agreement have been paid; and the grants, registrations and applications for such owned Intellectual Property have not lapsed, expired or been abandoned and no application or registration thereof is the subject of any legal or governmental proceeding before any governmental, registration or other authority in any jurisdiction. 15. Schedule ____ sets forth a complete list of all: (i) licenses, sublicenses and other agreements in which Seller has granted to any person or has been granted by any person the right to use the Intellectual Property including, without limitation, all content, supplier, composer and distributor agreements; and (ii) all other consents, co-existence agreements, indemnifications, forbearances to sue, settlement agreements and licensing or cross-licensing arrangements to which the Seller is a party relating to the Intellectual Property or the proprietary rights of any third party. Except as set forth in Schedule ______, Seller is not under any obligation to pay royalties or other payments in connection with any license, sublicense or other agreement, or restricted from assigning its rights under any license, sublicense or agreement respecting Intellectual Property, nor will Seller otherwise be, as a result of the execution and delivery of this Agreement or the performance of its obligations under this Agreement, in breach of any license, sublicense or other agreement relating to the Intellectual Property. 16. Except as set forth herein, Seller is the exclusive owner of all right, title and interest in, free and clear of all Liens and other adverse claims, all of the Intellectual Property used in the conduct of the business of Seller as currently conducted and proposed to be conducted. Seller has taken the steps reasonably necessary to protect its right, title and interest in and to the Intellectual Property. © Copyright 2013 Docstoc Inc. 9 17. With respect to Trade Secrets (i) the documentation relating to such Trade Secrets is current, accurate and sufficient in detail and content to identify and explain it and to allow its full and proper use without reliance on the knowledge or memory of any individual; (ii) Seller has taken all reasonable precautions to protect the secrecy, confidentiality of the Trade Secrets and (iii) Seller has good title and an absolute (but not necessarily exclusive) right to use any such Trade Secrets. The Trade Secrets are not part of the public knowledge or literature and, to Seller’s Knowledge, have not been used, divulged or appropriated either for the benefit of any Person or to the detriment of Seller. No Trade Secret is subject to any adverse claim or has been challenged or threatened in any way. 18. Except as disclosed herein, there are no conflicts with or infringements of any Intellectual Property by any third party. The conduct of the Business as currently conducted does not conflict with or infringe in any way with any proprietary right of any third party. There is no claim, suit, action or proceeding pending or, to Sellers’ knowledge, threatened against the Business (i) alleging any such conflict or infringement with any third party’s proprietary rights or (ii) challenging the ownership, use, validity or enforceability of the Intellectual Property. 19. The Intellectual Property is sufficient and adequate and constitutes all of the Intellectual Property that is necessary to carry on the Business as presently conducted or currently contemplated. o [If applicable] Software. Schedule ____ sets forth a complete list of all Software that Seller either owns outright, or has an exclusive perpetual, royalty-free license to use, reproduce, modify, distribute and sublicense which is related to the Purchased Assets (“Proprietary Software”). Seller has not sold, licensed, leased or otherwise transferred or granted any interest or rights in or to any portion of the Proprietary Software. Seller has taken the steps reasonably necessary to protect its right, title and interest in and to the Proprietary Software, including, without limitation, the execution of appropriate confidentiality agreements or assignments. The third party operating and applications computer software programs and databases used or licensed that are material to the conduct of the Business as now conducted and as presently contemplated to be conducted (the “Third Party Software”) are listed on Schedule 3.16 hereto. Seller has valid, fully paid, licenses to use, reproduce, modify, distribute and sublicense all copies of the Third Party Software, and have not sold, licensed, leased or otherwise transferred or granted any interest or rights in or to any portion thereof. The Proprietary Software and Third Party Software together are sufficient and adequate and constitute all of the software that is necessary to carry on the Business as presently conducted or currently contemplated. o Finder’s Fees. There is no investment banker, broker, finder or other intermediary which has been retained by or is authorized to act on behalf of Seller who might be entitled to any fee or commission from Seller upon consummation of the transactions contemplated by this Agreement. o Tax Returns. The United States tax returns for the years ______________ (the “Tax Returns”), (i) are included as Schedule _____; (ii) present fairly the financial condition and the results of operations of the Business as of the dates and for the periods indicated thereon, © Copyright 2013 Docstoc Inc. 10 excluding any revenues related to any Excluded Assets; (iii) are complete, correct, and consistent with the books of account and records of the Seller and (iv) reflect accurately all costs and expenses for the Business, excluding any expenses related to any Excluded Assets. o Disclosure. 20. No representation or warranty of Seller in this Agreement omits to state a material fact necessary to make the statements herein, in light o the circumstances in which they were made, not misleading. 21. There is no fact known to either Seller that has specific application to the Purchased Assets or the Business (other than general economic or industry conditions) and that materially adversely affects or, as far as either Seller can reasonably foresee, materially threatens, the Purchased Assets or the prospects, financial condition or results of operations of the Business, that has not been set forth in this Agreement or the disclosure schedules hereto. o Taxes. 22. Seller has timely paid all Taxes which will have been required to be paid on or prior to the date hereof, the non-payment of which would result in a Lien on any Purchased Asset, would otherwise adversely affect the Business or would result in Buyer becoming liable or responsible therefore. 23. Seller has established, in accordance with GAAP, adequate reserves for the payment of, and will timely pay, all Taxes which arise from or with respect to the Purchased Assets or the operation of the Business and are incurred in or attributable to the Pre-Closing Tax Period, the non-payment of which would result in a Lien on any Purchased Asset, would otherwise adversely affect the Business or would result in Buyer becoming liable therefore. REPRESENTATIONS AND WARRANTIES OF BUYER Buyer hereby represents and warrants to Seller as follows: o Organization and Qualification. Buyer has been duly organized and is validly existing and in good standing (to the extent applicable) under the laws of the jurisdiction of its incorporation or organization and has the requisite power and authority and all necessary governmental approvals to own, lease and operate its properties and to carry on its business as it is now being conducted. [Applicable if Buyer is an organized business entity} o Corporate Authorization. The execution, delivery and performance by Buyer of this Agreement, and the consummation by Buyer of the transactions contemplated hereby and thereby are within Buyer’s powers and have been duly authorized by all necessary action on the part of Buyer. This Agreement to which Buyer is a party has been duly executed and delivered by Buyer and constitutes valid and binding agreements of Buyer, enforceable against Buyer in accordance with their respective terms. o Non-Contravention. The execution, delivery and performance by Buyer of this Agreement to which Buyer is a party do not and will not (i) contravene or conflict with the © Copyright 2013 Docstoc Inc. 11 organizational documents or bylaws of Buyer or (ii) contravene or conflict with or constitute a violation of any provision of any material law or regulation, judgment, injunction, order or decree binding upon or applicable to Buyer. o Finders’ Fees. There is no investment banker, broker, finder or other intermediary which has been retained by or is authorized to act on behalf of Buyer who might be entitled to any fee or commission from Buyer upon consummation of the transactions contemplated by this Agreement. COVENANTS OF THE PARTIES The parties hereto agree that: o Commercially Reasonable Efforts; Further Assurances. 24. Subject to the terms and conditions of this Agreement and except as otherwise set forth in this Agreement, each party will use its commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary or desirable under applicable laws and regulations to consummate the transactions contemplated by this Agreement. Seller and Buyer each agree to execute and deliver such other documents, certificates, agreements and other writings and to take such other actions as may be necessary or desirable in order to consummate or implement expeditiously the transactions contemplated by this Agreement and to vest in Buyer title to the Purchased Assets as provided herein. 25. Seller hereby constitutes and appoints, effective as of the Closing Date, Buyer and its successors and assigns as the true and lawful attorney of Seller with full power of substitution in the name of Buyer or in the name of Seller, but for the benefit of Buyer, except as otherwise contemplated hereby, (i) to collect for the account of Buyer any items of Purchased Assets and (ii) to institute and prosecute all proceedings which Buyer may in its sole discretion deem proper in order to assert or enforce any right, title or interest in, to or under the Purchased Assets, and to defend or compromise any and all actions, suits or proceedings in respect of the Purchased Assets. Buyer shall be entitled to retain for its account any amounts collected pursuant to the foregoing powers, including any amounts payable as interest in respect thereof. o Certain Filings. Seller and Buyer shall cooperate with one another and shall use all reasonable efforts and take all reasonable steps to obtain all consents, approvals, waivers or other documents from any third parties, including any governmental authorities, and make all filings, registrations and other notifications, as may be required to consummate the transactions contemplated by this Agreement and, in taking such actions or making any such filings, furnishing information required in connection therewith and seeking timely to obtain any such actions, consents, approvals or waivers. o Confidentiality. Except for disclosure to a party’s advisors, who shall agree to be bound by these confidentiality terms, or as required by law or securities regulations, neither party shall disclosure the terms of this Agreement to any third party. © Copyright 2013 Docstoc Inc. 12 o Nonsolicitation; Noncompetition by Seller [Instruction: If Applicable Insert Individuals Names who would be subject to this provision. If this is applicable, then the individual also needs to be named a party to this Agreement and listed in the opening paragraph listing the parties.] 26. ______________________ agrees, that, for a period of _____ (__) years following the Closing Date, Seller shall be prohibited from soliciting employees, consultants or suppliers of, the Business without the prior written consent of Buyer. 27. Seller acknowledges and agrees that the covenants set forth in this Section 5.04 are reasonable and valid in scope and in all other respects. If any of such covenant is found to be invalid or unenforceable by a final determination of a court of competent jurisdiction (i) the remaining terms and provisions hereof shall be unimpaired and (ii) the invalid or unenforceable term or provision shall be deemed replaced by a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision. o Public Announcements. Buyer shall publish a press release concerning the transactions contemplated hereby provided that it first provides a copy to Seller. Notwithstanding the foregoing, Buyer shall not be prevented from complying with the applicable law or securities market regulations with respect to the foregoing. o Tax Matters. 28. Buyer and Seller agree to furnish or cause to be furnished to each other, upon request, as promptly as practicable, such information and assistance relating to the Business and the Purchased Assets (including access to books and records) as is reasonably necessary for the filing of all tax returns, the making of any election relating to Taxes, the preparation for any audit by any taxing authority, and the prosecution or defense of any claim, suit or proceeding relating to any Tax. Buyer and Seller shall retain all books and records with respect to Taxes pertaining to the Purchased Assets for a period of at least six years following the Closing Date. On or after the end of such period, each party shall provide the other with at least 10 days prior written notice before destroying any such books and records, during which period the party receiving such notice can elect to take possession, at its own expense, of such books and records. Seller and Buyer shall cooperate with each other in the conduct of any audit or other proceeding relating to Taxes involving the Purchased Assets or the Business. 29. All real property taxes, personal property taxes and similar ad valorem obligations levied with respect to the Purchased Assets for a taxable period which includes (but does not end on) the Closing Date (collectively, the “Apportioned Obligations”) shall be apportioned between Seller and Buyer based on the number of days of such taxable period included in the Pre-Closing Tax Period and the number of days of such taxable period after the Closing Date (such portion of such taxable period, the “Post-Closing Tax Period”). Seller shall be liable for the proportionate amount of such taxes that is attributable to the Pre-Closing Tax Period, and Buyer shall be liable for the proportionate amount of such taxes that is attributable to the Post-Closing Tax Period. © Copyright 2013 Docstoc Inc. 13 30. All excise, sales, use, value added, registration stamp, recording, documentary, conveyancing, franchise, property, transfer, gains and similar Taxes, levies, charges and fees (collectively, “Transfer Taxes”) incurred in connection with the transactions contemplated by this Agreement shall be borne by Seller. Seller shall not be responsible for Buyer’s sales tax obligations, if any. Seller represents and warrants to Buyer that, with respect to the transactions contemplated by this Agreement, Seller is entitled to an exemption from Transfer Taxes for isolated, casual or occasional sales in each jurisdiction that would otherwise impose a Transfer Tax on the transactions. Buyer and Seller shall cooperate in providing each other with any appropriate resale exemption certifications and other similar documentation. 31. Apportioned Obligations shall be timely paid and all applicable filings, reports and returns shall be filed, as provided by applicable law. The paying party shall be entitled to reimbursement from the non-paying party in accordance with Section 5.06(b). Upon payment of any such Apportioned Obligation or Tax, the paying party shall present a statement to the non-paying party setting forth the amount of reimbursement to which the paying party is entitled under Section 5.06(b) together with such supporting evidence as is reasonably necessary to calculate the amount to be reimbursed. The non-paying party shall make such reimbursement promptly but in no event later than 10 days after the presentation of such statement. o Assistance. Seller shall forward to Buyer, on a timely basis, all e-mail, payments, postal mail, telephone or other correspondence or items received by Seller with regard to the Business. CLOSING DELIVERIES o Closing Deliveries. At the Closing: 32. Buyer shall deliver to Seller the portion of the Purchase Price set forth in Section 2.05(a)(i), by wire transfer or other agreed upon method of transferring immediately available funds to the account or accounts set forth on Schedule ____. 33. Seller and Buyer shall each execute and deliver the Agreement, and Seller shall deliver to Buyer such deeds, bills of sale, endorsements, consents (including, without limitation, all of the Required Consents), assignments and other good and sufficient instruments of conveyance and assignment as the parties and their respective counsel shall deem reasonably necessary or appropriate to vest in Buyer all right, title and interest in, to and under the Purchased Assets. 34. Seller shall execute and deliver all requisite resolutions or actions of its directors, managers, shareholders and members, as applicable and necessary, approving the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby and thereby. 35. Each of Seller and Buyer shall execute and deliver all such instruments, documents and certificates as may be reasonably requested by the other party that are necessary, appropriate or desirable for the consummation at the Closing of the transactions contemplated by this Agreement. © Copyright 2013 Docstoc Inc. 14 SURVIVAL; INDEMNIFICATION o Survival. 36. All of the representations and warranties of the Seller contained in this Agreement (the “Seller’s Representations”) shall survive the Closing and continue in full force and effect for eighteen (18) months; provided, however, that the representations and warranties of Seller contained in Section 3.01 (Organization and Qualification), Section 3.02 (Corporate Authorization), Section 3.03 (Non-Contravention), Section 3.08 (Title to Purchased Assets) and Section 3.17 (Finder’s Fee) (collectively the “Seller’s Perpetual Representations”), in each case, shall survive the Closing and continue in full force and effect forever thereafter. All of the covenants of Seller contained in this Agreement shall survive the Closing and continue in full force and effect forever thereafter. 37. The representations and warranties of Buyer set forth in this Agreement, or in any certificate delivered by Buyer with respect to such representations (the “Buyer’s Representations”) shall survive the Closing and continue in full force and effect for _________ (_____) months [Instruction: Recommendation is a minimum of twelve months]. All of the covenants of Buyer contained in this Agreement shall survive the Closing and continue in full force and effect forever thereafter. 38. Notwithstanding anything to the contrary in this Section 7.01, any notice given in accordance with Section 8.01 of this Agreement (and delivered within the applicable survival period for such representation or warranty) claiming an alleged breach of any representation or warranty contained in this Agreement shall without further action extend the survival period for the representation or warranty alleged to have been breached as applied to the circumstances set forth in such notice until immediately after the final resolution of the matter. o Indemnification Provisions for Benefit of Buyer and Seller. 39. In the event Seller breaches any of Seller’s Representations or Seller’s Perpetual Representations and provided that, as to any claim for such breach of Seller’s Representations or Seller’s Perpetual Representations, Buyer makes a written claim for indemnification against Seller within the survival period, if applicable, then Seller agrees to indemnify the Buyer, its Affiliates and each of their officers, directors, employees, agents or representatives (collectively, the “Buyer Indemnified Parties”) from and against all Damages that any Buyer Indemnified Parties suffer resulting from or arising out of such event; provided, however, that Seller shall not have any obligation to indemnify any Buyer Indemnified Party from and against any Damages resulting from the breach of any Seller’s Representation (as opposed to any covenant of Seller) other than Seller’s Perpetual Representations (i) until Damages exceed five thousand dollars ($5,000) and (ii) to the extent the aggregate amount of Damages for which Seller has actually indemnified Buyer Indemnified Parties with respect to prior breaches of Seller’s Representations (other than Seller’s Perpetual Representations) exceeds the Purchase Price (the “Cap”). © Copyright 2013 Docstoc Inc. 15 40. Without limiting the generality or effect of the foregoing, Seller shall indemnify, defend and hold harmless any Buyer Indemnified Parties from and against any and all Damages resulting from or arising out of any of the following (which indemnification, defense and hold harmless shall not be subject to any of the limitations set forth in Section 7.02(a)): a. any breach of the covenants of Seller contained in this Agreement or in any other Ancillary Agreement and any breach of Seller’s Perpetual Representations; b. any claim of any creditor or beneficiary (in their capacity as such) of Seller or any of its Affiliates, whether arising prior to, on or after the Closing Date; c. any and all Pre-Closing Tax Liability; d. any Liability resulting from or related to any Excluded Asset; e. any Excluded Liability; or f. any fraud or intentional misrepresentation by Seller hereunder. 41. In the event Buyer breaches any of Buyer Representations and provided that, as to any claim for breach of such Buyer Representations, Seller makes a written claim for indemnification against Buyer within the survival period, if applicable, then Buyer agrees to indemnify Seller, its Affiliates and each of its officers, directors, employees, agents or representatives (collectively, the “Seller Indemnified Parties”) from and against all Damages that any Seller Indemnified Parties suffer resulting from or arising out of such event; provided, however, that Buyer shall not have any obligation to indemnify any Seller Indemnified Parties from and against any Damages resulting from the breach of any Buyer Representations (as opposed to any covenant of Buyer) to the extent the aggregate amount for which Buyer has actually indemnified Seller Indemnified Parties with respect to prior breaches of Buyer Representations exceeds the Cap. 42. Without limiting the generality or effect of the foregoing, Buyer shall indemnify, defend and hold harmless any Seller Indemnified Parties from and against any and all Damages resulting from or arising out of any breach of the covenants of Seller contained in this Agreement or in any other Ancillary Agreement (which indemnification, defense and hold harmless shall not be subject to any of the limitations set forth in Section 7.02(c)). o Matters Involving Third Parties. 43. If any third party notifies any party hereto (the “Indemnified Party”) with respect to any matter which may give rise to a claim (other than a Tax Claim) for indemnification against the other party hereto (the “Indemnifying Party”) under this Article VII, then the Indemnified Party shall use reasonable efforts to notify the Indemnifying Party thereof promptly and in any event within ten (10) days after receiving any written notice from a third © Copyright 2013 Docstoc Inc. 16 party; provided, however, that no delay on the part of the Indemnified Party in notifying the Indemnifying Party shall relieve the Indemnifying Party from any obligation hereunder unless, and then solely to the extent that, the Indemnifying Party is materially prejudiced thereby. 44. Once the Indemnified Party has given notice of the matter to the Indemnifying Party, the Indemnified Party may, subject to the Indemnifying Party’s rights to assume the defense of such matter pursuant to this Section 7.03, defend against the matter in any manner it deems appropriate. 45. The Indemnifying Party may at any point in time choose to assume the defense of all of such matter, in which event: a. the Indemnifying Party shall defend the Indemnified Party against the matter with counsel of its choice reasonably satisfactory to the Indemnified Party; b. the Indemnified Party may retain separate counsel at its sole cost and expense (except that the Indemnifying Party shall be responsible for the fees and expenses of one separate co-counsel for all Indemnified Parties to the extent the Indemnified Party is advised, in writing by its counsel, that either (A) the counsel the Indemnifying Party has selected has a conflict of interest or (B) there are legal defenses available to the Indemnified Party that are materially different from or additional to those available to the Indemnifying Party); and c. the Indemnifying Party shall reimburse the Indemnified Party for the reasonable costs of defense or investigation for the period prior to the assumption of the defense. 46. Assumption of the defense of any matter by the Indemnifying Party shall without further action constitute an irrevocable waiver by the Indemnifying Party of its right to claim at a later date that such third party action for which the defense was assumed is not a proper matter for indemnification pursuant to this Article VII. 47. The Indemnified Party shall not consent to the entry of a judgment or enter into any settlement with respect to any matter which may give rise to a claim for indemnification without the written consent of the Indemnifying Party, which consent may not be unreasonably withheld or delayed; provided, however, that if the Indemnifying Party has failed to provide indemnification required to be provided pursuant to this Article VII for thirty (30) days after a request therefor, then the Indemnified Party may take any such action without the consent of the Indemnifying Party (provided that the Indemnified Party must give the Indemnifying Party at least ten (10) days prior notice of such action). 48. The Indemnifying Party shall not consent to the entry of a judgment or enter into any settlement with respect to any matter which may give rise to a claim for indemnification or enter into any settlement which does not include a provision whereby the plaintiff or claimant in the matter releases the Indemnified Party from all liability with respect © Copyright 2013 Docstoc Inc. 17 thereto, without the written consent of the Indemnified Party, which consent shall not be unreasonably withheld or delayed. o Certain Additional Provisions Relating to Indemnification. 49. After the Closing Date, the indemnification provisions set forth in this Article VII shall constitute the sole and exclusive recourse and remedy available to the parties hereto with respect to the breach of any representation or warranty contained in this Agreement except for willful misconduct, fraud or intentional misrepresentations or breaches of Section 5.04. 50. All payments by an Indemnifying Party under Article VII shall be treated as an adjustment to the Purchase Price for all foreign, federal, state and local income tax purposes. 51. The Indemnification provided for in this Article VII shall survive any investigation at any time made by or on behalf of Buyer or any knowledge or information that Buyer may have. MISCELLANEOUS o Notices. All notices, requests and other communications to either party hereunder shall be in writing (including telecopy or similar writing) and shall be given, if to Buyer, to: Address: __________________________ City/State/Zip: ______________________ Fax: ______________________________ Email: _____________________________ if to Seller, to: Address: __________________________ City/State/Zip: ______________________ Fax: ______________________________ Email: _____________________________ o Amendments; No Waivers. 52. Any provisions of this Agreement may be amended or waived if, and only if, such amendment or waiver is in writing and signed, in the case of an amendment, by Buyer and Seller, or in the case of a waiver, by the party against whom the waiver is to be effective. © Copyright 2013 Docstoc Inc. 18 53. No failure or delay by either party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. o Expenses. Except as otherwise provided herein, all costs and expenses incurred in connection with this Agreement shall be paid by the party incurring such cost or expense. o Successors and Assigns. Except as otherwise provided in this Agreement, no party hereto shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other party hereto and any such attempted assignment without such prior written consent shall be void and of no force and effect; provided, however, Buyer may assign this Agreement to any of its Affiliates or to any third party purchaser of the Business or all or substantially all of the Purchased Assets without consent. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. o Governing Law. This Agreement shall be construed in accordance with and governed by the law of the State of __________________, without regard to the conflicts of law rules of such state. o Counterparts; Effectiveness. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement shall become effective when each party hereto shall have received a counterpart hereof signed by the other party hereto. o Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements, understandings and negotiations, both written and oral, between the parties with respect to the subject matter of this Agreement. No representation, inducement, promise, understanding, condition or warranty not set forth herein has been made or relied upon by either party hereto. Nothing in this Agreement is intended to confer upon any person other than the parties hereto any rights or remedies hereunder. o Captions. The captions herein are included for convenience of reference only and shall be ignored in the construction or interpretation hereof. o Incorporation of Exhibits and Schedules. The Schedules referred to in this Agreement are incorporated herein and made a part hereof. o Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against any party. Any references to any federal, state, local or foreign statute or law will also refer to all rules and regulations promulgated thereunder, unless the context requires otherwise. Unless the context otherwise requires: (a) a term has the meaning assigned to it by this Agreement; (b) including means “including without limitation”; (c) “or” is © Copyright 2013 Docstoc Inc. 19 disjunctive but not exclusive; (d) words in the singular include the plural, and in the plural include the singular; and (e) “$” means the currency of the United States of America. o Severability. In the event that any one or more of the provisions contained in this Agreement or in any other instrument referred to herein, shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, then to the maximum extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any other such instrument. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable. o No Third-Party Beneficiaries. Except as set forth in Article VII, this Agreement shall not confer any rights or remedies upon any Person other than the parties hereto and thereto and their respective successors and permitted assigns. © Copyright 2013 Docstoc Inc. 20 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written. SELLER: By:_________________________________ Name: Title: BUYER: By: Name: Title: [This provision should only be inserted if there is a non-competition provision being executed by an entity/person besides the Seller, for example, an officer(s) of Seller, etc.] The undersigned has executed this Agreement for the limited purpose of, and hereby agrees to be bound and abide by the terms of Sections 5.04 of this Agreement: By: _________________________________ © Copyright 2013 Docstoc Inc. 21
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