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Ontario Offer to Purchase Restaurant Assets

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Purchase the assets and property of a restaurant in Ontario with this downloadable Offer to Purchase Restaurant Assets. - Once the seller has accepted the offer in writing, it becomes a legally binding agreement of purchase and sale between the parties. - On closing, the buyer will pay the seller the value of liquor, food and beverages on hand, valued at either cost or net realizable value, whichever is lower. - The buyer is not required to purchase inventory older than two months or inventory which is unsaleable or unusable. - The buyer is responsible for remitting the GST applicable to the sale. The buyer will also pay retail sales tax on the purchased assets. - The seller will give the buyer reasonable access to the premises, books and records of the business to enable the buyer to conduct its due diligence investigation. - The agreement contains the standard representations and warranties of each party. - The seller agrees not to carry on or be involved with a competing business within 10 miles of the restaurant premises, and not to solicit customers or employees from the business. This Ontario Offer to Purchase Restaurant Assets is completely customizable to fit your circumstances.

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									                               Offer to Purchase
                                      (Restaurant Purchase)

[Buyer Name] (the “Buyer”) hereby offer to purchase from [Seller Name] (the “Seller”), all of the
undertaking, property and assets of the Seller of every kind and description and wherever situated
used in its [Business Name] business (the “Business”), which it carries on from rented premises at
[Business Address] (the “Premises”), as a going concern including but not limited to the assets
described in Schedule “A” hereto (the “Purchased Assets”), upon and subject to the following terms
and conditions, provided that the Business assets set out in Schedule “B” shall be excluded from this
Agreement (the “Excluded Assets”):

1   Irrevocable Period. This Offer shall be irrevocable by the Buyer until 5:00 on [Irrevocable
    Date], after which time, if not accepted, this Offer shall be null and void and the Deposit
    returned to the Buyer without interest or deduction. Upon written acceptance of this Offer by the
    Seller, this Offer to Purchase shall constitute a binding agreement of purchase and sale between
    the Buyer and the Seller on the terms herein set out.

2   Closing Date. Time shall be of the essence. The closing of this transaction shall take place on
    [Closing Date], or such earlier or later date as may be mutually agreed to between the parties
    (the “Closing Date” or “Closing”) at the office of the Buyer’s solicitors or at such other place as
    may be approved in writing by the parties or their respective solicitors.

3   Purchase Price. The purchase price for the Purchased Assets shall be $[Purchase Price], plus
    inventory under paragraph 442 and such other sums payable under the terms of this Agreement
    (the “Purchase Price”).

4   Inventory and Supplies. In addition to the other sums payable under this Agreement, the Buyer
    will pay the Seller on Closing the value of liquor, food and beverages on hand as of the Closing
    Date (“Inventory”), valued at lower of cost and net realizable value, as determined by the Seller
    and Buyer by conducting a physical inventory on or immediately before the Closing Date. If the
    Seller and the Buyer cannot agree on the value of Inventory, the average of their assessments
    shall be used on Closing, the parties shall undertake to readjust following Closing, and an
    independent appraiser of Inventory agreeable to both parties shall be hired and his or her decision
    shall be final and binding. The Buyer shall not be required to purchase: (a) Inventory which was
    purchased more than two months prior to Closing; or (b) Inventory which is damaged, unsaleable
    or unusable, as the case may be; or (c) more than $[Inventory Maximum] in Inventory in the
    total aggregate. All Inventory not acquired by the Buyer under this Agreement shall remain the
    property of the Seller and shall be removed from the Premises by the Seller on or before Closing
    or within seven days after Closing.

5   Payment of Purchase Price. The Purchase Price shall be paid as follows:

    (a) Immediately upon acceptance of this Offer, the Buyer will deliver to the Buyer’s solicitors a
        cheque or bank draft payable to the Buyer’s solicitors in trust in the amount of $[Deposit
        Amount] as a deposit (the “Deposit”), to be held in a non-interest bearing account pending
        completion or termination of this Agreement; and

    (b) On Closing the Seller will pay the balance of the Purchase Price, subject to the usual
        adjustments and any adjustments set out in this Agreement, by certified funds.

6   Deposit. If the Buyer fails to complete this transaction as a result of the breach by the Buyer of
    any of its obligations in this Offer, the Deposit together with interest thereon (if any) shall be
    delivered to the Seller as liquidated damages and in final settlement of any and all claims of the
    Seller against the Buyer of any kind whatsoever arising out of such failure to complete including
    costs, expenses and damages under any theory or rule of law, and the Deposit shall be obtained
    by the Seller making the requisite demand upon the Buyer’s solicitors. If the Buyer fails to
    complete this transaction for any other reason, including but not limited to the non-fulfillment of
    any of the conditions for the Buyer’s benefit set forth in this Offer or the Seller’s default, the
    Seller shall not be entitled to the Deposit and it shall be immediately released to the Buyer
    without deduction or setoff.

7   Adjustments. The Purchase Price shall be subject to adjustment for rent, utilities, Buyer’s
    maximum obligations under s. 9 of the Employment Standards Act (if any), and any other
    adjustments on a transaction of this kind as appropriate, such adjustments being made to the
    amount payable at the time of Closing. If any adjustments are made for the Buyer’s obligations
    under s. 9 of the Employment Standards Act, then the Buyer will assume all such obligations for
    and on behalf of the Seller to the extent therein set out and hereby indemnifies the Seller from all
    liabilities or obligations to those employees to the extent adjusted.

8   Assumed Liabilities: The Buyer shall not assume any liabilities of the Seller of any kind, except
    for as included in the adjustments under paragraph 776.

9   Allocation. The Purchase Price shall be allocated between the Purchased Assets by the parties
    prior to Closing, provided no more than $1.00 will be allocated to goodwill. If the parties can not
    agree on the allocation prior to Closing, the accountants for the parties shall make such
    determination acting together; if they cannot agree, a Chartered Accountant acceptable to both
    shall make the determination and his or her decision shall be final and binding. The Seller and
    the Buyer agree that the amounts so attributed to the Assets are the respective fair market values
    thereof, and shall file in mutually agreeable form all elections required or desirable under the
    Income Tax Act (Canada) in respect of the foregoing allocations.

10Goods and ServicesHarmonized Sales Tax. The Purchase Price does not include GSTHST. The                  Formatted: Bullets and Numbering
   Buyer shall pay and remit all GSTHST exigible as a result of this transaction, and indemnifies
   the Seller in that regard. The Seller and the Buyer shall each be GSTHST registrants at the time
   of Closing, and shall complete and execute a valid joint election as provided in subsection 167(1)
   of The Excise Tax Act (Canada). The Buyer shall file such election with Revenue Canada Canada
   Revenue Agency with the Seller’s GSTHST return for the reporting period in which the Closing
10                                                                                                      Formatted: Outline numbered + Level: 1 +
                                                                                                        Numbering Style: 1, 2, 3, … + Start at: 1 +
11RST. The Purchase Price does not include Retail Sales Tax (“RST”). On Closing the Seller shall        Alignment: Left + Aligned at: 0" + Tab after:
   collect and the Buyer shall pay such RST, as may be exigible on the Purchased Assets. The            0.25" + Indent at: 0.25", Tab stops: 0.5", List
   Buyer shall pay and remit all RST exigible as a result of this transaction, and indemnifies the
   Seller in that regard.                                                                               Formatted: Bullets and Numbering

1211 Bulk Sales Act. This transaction will be completed under and pursuant to the Bulk Sales Act        Formatted: Bullets and Numbering
   (Ontario), and the Seller will comply with the requirements of that Act at its expense.

1312 Investigation. The Buyer and its advisers shall during business hours have reasonable access       Formatted: Bullets and Numbering
   to the Premises, books, leases and other records of the Business for the purpose of investigating
   the business and affairs of the Business. Within one week following acceptance of this Offer the
   Seller shall deliver copies of the following documentation and information to the Buyer, or shall
   make the following available for inspection including the right to inspect originals, make notes
   and photocopy:

   (a) Franchise agreement and documents (if any);

   (b) Lease or sublease;

   (c) Liquor license files and documents (if any);

   (d) List of employees by name including date of first hire, current position held, hours of work,
       and rate of pay, compensation or benefits, and all employee files;

   (e) List of all suppliers including name, address, contact particulars, and copies of any relevant

   (f) List of all fixtures, furnishings, equipment and leasehold improvements;

   (g) Preliminary list of Inventory;

   (h) All tax or government returns or assessments of any kind, including income tax, source
       deduction, WSIB, RST and GSTHST, and all government or regulatory correspondence or
       files, for the past two years;

   (i) Cash register tapes and bank deposits for the past twelve months;

   (j) Expenses by month for the past twelve months;

   (k) Cash journal and general ledger for the past twelve months;

   (l) All franchisor reports (if any) for the past twelve months;

   (m) Any internal or accountant prepared financial statements since the location opened for
       business, including access to accountant working papers;

   (n) A balance sheet and income statement as of each of the last two fiscal year ends;

   (o) A year to date balance sheet and income statement; and

   (p) Such other documentation as the Buyer shall reasonably request.

   The Buyer shall keep all such information confidential. If this transaction closes through not fault
   of the Seller, all such information and all copies thereof shall be returned to the Seller.

1413 Third Party Consents. The Buyer acknowledges that, besides the landlord for the Premises             Formatted: Bullets and Numbering
   and the franchisor, and assignment of the liquor license for the Premises, no other consents of
   third parties are required for the completion of this Agreement.

1514 Franchisor and Landlord Approval. This Agreement and the obligations of the Buyer                    Formatted: Bullets and Numbering
   hereunder shall be conditional as set out in sub-paragraphs 23(b)24(b)23(b) and 23(c)24(c)23(c)
   until on the Buyer being approved by the franchisor and the landlord to the extent required by the
   franchise agreement and lease in question, on terms satisfactory to the Buyer in its sole and
   absolute discretion. The Seller and Buyer shall work together and use their best efforts to obtain
   consents of the franchisor and landlord prior to Closing. The Seller shall pay all transfer or
   assignment fees or expenses charged by the franchisor or the landlord.

1615 Transfer of Liquor License. The Seller will ensure that the current liquor license for the           Formatted: Bullets and Numbering
   Premises (“Liquor License”) is in good standing up to and including Closing. The Seller and
   Buyer agree they will work together to have the Liquor License transferred to the Buyer, and
   agree that on acceptance of this Offer they will each immediately thereafter execute an
   Application to Transfer the Liquor License and an Application for Authorization to Contract Out
   to be delivered to the Alcohol and Gaming Commission by the Buyer immediately thereafter.
   This Agreement and the obligations of the Buyer hereunder shall be conditional until Closing on
   the Buyer obtaining an Authorization to Contract Out and satisfying itself in its sole and absolute
   discretion that it will be able to have the Liquor License transferred to the Buyer following
   Closing on terms and conditions satisfactory to it in its sole and absolute discretion.

1716 Corporate Resolutions. The Seller shall comply with the provisions of Ontario or Canada              Formatted: Bullets and Numbering
   Business Corporations Act (as applicable), and shall provide a certified copy of a unanimous
   Shareholders’ Resolution of the Seller on Closing authorizing the entering into and completion
   of this Agreement.

1817 Seller Representations and Warranties. The Seller represents and warrants to the Buyer as            Formatted: Bullets and Numbering
(a) The Seller is now and on the Closing Date will be a resident of Canada within the meaning of
    the Income Tax Act (Canada).

(b) The Seller will, immediately upon execution of this Agreement, apply for clearance
    certificates under the Retail Sales Tax Act and Workplace Safety and Insurance Act and will
    keep the Buyer fully informed of all communications in that regard;

(c) All financial information provided to the Buyer, including all Bulk Sales Act documentation,
    accurately, fairly and completely presents the financial position of the Business as at the
    dates thereof and includes and discloses the material liabilities (either actual, accrued or
    contingent and whether direct or indirect) of the Business as of such date.

(d) The Seller is financially solvent and will be able to comply with the requirements of the Bulk
    Sales Act, including delivering the Statement required under s. 4 of that Act, without having
    to obtain consents or waivers from any unsecured creditors or a court order approving this
    transaction, and without relying upon any receivership or insolvency based exceptions.

(e) The Business is not now, nor at Closing will be bound by any agreement whether written or
    oral with any employee providing for a specified period of notice of termination nor
    providing for any fixed term of employment; and has now and at Closing will have no
    employees who cannot be dismissed upon such notice as is required by statutory or common
    law. None of the employees of the Business are subject to a collective agreement or
    collective bargaining process and the Seller is not aware of any current attempts to organize
    the employees under the Labour Relations Act or any provincial or federal legislation. All
    employees of the Business, and their current position, compensation and length of service,
    will be set out in the disclosure documents required under paragraph 121312 above.

(f) The Closing of this Agreement will not require the approval of any third parties except as
    expressly set out in this Agreement in writing.

(g) The Seller now has and at Closing will have a good and marketable title to the Purchased
    Assets, free and clear of any and all claims, liens, encumbrances, deemed trusts and security
    interests whatsoever.

(h) The tangible Purchased Assets are now and shall at the time of closing be in good condition,
    subject only to reasonable wear and tear incurred in the ordinary course of business.

(i) None of the assets of the Business as listed in the schedules attached to this Agreement are
    leased, on consignment, or subject to any conditional sales contract.

(j) Except as expressly set out in this Agreement, the Buyer will not after Closing be bound to or
    by any Seller contract, agreement, liability or obligation.

(k) The Seller is not now and at Closing will not be in arrears or in default in respect of the filing
    of any required federal, provincial or municipal tax or other return, including income taxes,
    GSTHST, RST, source deductions, CPP, UIC, WSIB and EHT, and at each of such times (i)
    all taxes, filing fees and other assessments due and payable or collectable from the Seller
    shall have been paid or collected, (ii) no claim for additional taxes, filing fees or other
    amounts and assessments has been made which has not been paid, and (iii) to the best of the
    Seller’s knowledge, no such return shall have contained any misstatement or concealed any
    statement that should have been included therein. The Seller has withheld and will withhold
    up to Closing from each payment made to any employee the amount of all taxes (including
    but not limited to income tax) and other deductions required to be withheld therefrom and
    have paid or will pay such amounts to the proper tax or other receiving authority.

(l) The Seller is not subject to any outstanding or threatened litigation, government
    investigations or administrative proceedings of any kind whatsoever.

(m) The Seller is not aware of any outstanding orders, directions, notices, requirements,
    deficiencies investigations or proceedings involving the Premises or under the Environmental
    Protection Act or any other legislation of an environmental nature, the Occupational Health
    and Safety Act, the Workplace Safety and Insurance Act, the Employment Standards Act, the
    Labour Relations Act, the Ontario or Canada Human Rights Codes, the Criminal Code, the
    Building Code Act, the Fire Marshall's Act, the Municipal Act or any other legislation
    regulating the obligations of the Premises to the employees of the Business or the use or
    occupation of the Premises, including but not limited to any property standards by-laws.

(n) To the best of the Seller's knowledge, information and belief: A. the Premises and the use,
    maintenance and operation thereof have been and are in compliance with all municipal,
    provincial and federal environmental laws related thereto; B. the Seller has complied with all
    reporting, licensing and monitoring requirements under all environmental laws; C. the Seller
    has not received any notice of any non-compliance with any environmental laws; D. the
    Seller has never been convicted of an offence for non-compliance with any environmental
    laws or been fined or otherwise sentenced or settled such prosecution short of conviction
    with respect to the Premises; E. there are no hazardous substances located on or in any of the
    Premises, and no release of any ha
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