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Agreement for Sale of Assets of Corporation

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Agreement for Sale of Assets of Corporation Powered By Docstoc
					This agreement for the sale of substantially all of the assets of a corporation (Asset
Purchase Agreement) is used when a corporation is liquidating and selling its assets to
a third party. The agreement sets forth the terms of the sale and includes provisions
regarding purchase price, closing date, assumption of liabilities and assignment of
rights. This document contains numerous of the standard clauses commonly found in
asset purchase agreements and can be customized to address the specific needs of the
contracting parties. This agreement should be utilized by a business owner or partners
planning to sell a business or corporation.
     Agreement for Sale of Substantially all of the Assets of a Corporation – Asset Purchase
                                           Agreement

        This Asset Purchase Agreement is made this the (date), between (Name of Seller
Corporation), a corporation organized and existing under the laws of the state of
______________, with its principal office located at (street address, city, state, zip code),
referred to herein as “Seller”, and (Name of Buyer Corporation), a corporation organized and
existing under the laws of the state of ______________, with its principal office located at (street
address, city, state, zip code), referred to herein as “Buyer”.

1.       Sale of Business
         Seller shall sell, assign, and deliver to Buyer and Buyer shall purchase and accept, on the
closing date, all the assets and properties owned by Seller or in which Seller has any right, title,
or interest in, of every kind and description, wherever located, including all property tangible or
intangible and real or personal, goodwill, processes, research and development projects, designs,
patents, accounts receivable, bank accounts, cash, securities, claims, contract rights, the right to
use the names (Name of Corporation) or (Trade Name of Corporation) or any similar name or
names in connection with any (type of business) business, and all other names, trademarks, or
copyrights used by Seller in connection with its business or products, all as more specifically
described and set forth in Exhibit A, which is attached and incorporated by this reference. Seller
further shall sell and assign to Buyer and Buyer shall purchase and accept, on the closing date,
that parcel of land consisting of approximately (number) acres more or less at (street address,
city, state, zip code), on which the plant of Seller is situated, as is more precisely described in
Exhibit B, which is attached and incorporated by this reference, together with Seller's interest in
the improvements on the premises.

2.       Consideration and Assumption of Liabilities
         In consideration of the sale of assets and properties under this Agreement and of all other
things done and agreed to be done by Seller, Buyer shall pay to Seller on the closing date
$_____________ and further shall assume and pay all of Seller’s liabilities as reflected on its
Balance Sheet as of (date), prepared according to generally accepted accounting principles and
reflected in Exhibit C, which is attached and incorporated by this reference. However, the
liabilities shall not include the following:

         A.     Any liabilities accrued on or before (date) that were not reflected on the Balance
         Sheet as of that date and set out in Exhibit D.

         B.    Any liabilities accrued after (date), the date of the Balance Sheet set out in
         Exhibit D, that were not incurred in the ordinary course of business.

         C.      Any liabilities whenever accrued for federal or state income taxes or interest or
         penalties.

         D.     Any liabilities not reflected on the (date) Balance Sheet set out in Exhibit D for
         expenses incurred in connection with the audit of income returns.




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        E.      Any costs or expenses of whatever nature connected with or resulting from the
        negotiation or consummation of this Agreement or the sale or transfer of assets pursuant
        to this Agreement.

        F.       Any liabilities of any person or firm other than Seller.

3.      Instruments of Transfer
        The sales, assignments, and deliveries to be made to Buyer pursuant to this Agreement
shall be affected by deeds, bills of sale, endorsements, checks, and other instruments of transfer
in such form as Buyer shall reasonably request. Seller shall prepare appropriate forms of
instruments of transfer and conveyance in conformity with this Agreement and shall submit them
to Buyer for examination at least (number) days in advance of the closing date. Any time and
from time to time after the closing date, on Buyer's request, Seller will do, execute,
acknowledge, and deliver all such further acts, deeds, assignments, transfers, and powers of
attorney as may be required in conformity with this Agreement for the adequate assigning,
transferring, granting, and confirming to Buyer of the assets and properties sold to Buyer.

4.      Assignment of Contract Rights
        If any contract, license, lease, commitment, or sales or purchase order assignable to
Buyer under this Agreement may not be assigned without the consent of the other party to the
same, Seller will use their best efforts to obtain the consent of the other party to the assignment.
If any such consent cannot be obtained, the purchase price under this Agreement shall be
adjusted downward by the amount allocated to the affected contract rights in Exhibit E.

5.      Accounts Receivable
        After the closing date, Buyer shall have the authority to collect all receivables transferred
to Buyer under this Agreement and to indorse without recourse and without warranties of any
kind the name of Seller on any checks or evidence of indebtedness received by Buyer on account
of any receivables. Seller will transfer and deliver to Buyer any cash or other property that Seller
may receive in respect to any receivables.

6.      Books and Records
        Seller shall have the right to retain minute books, stock books, and other corporate
records of Seller having exclusively to do with a corporate organization or capitalization. All
other records and books of account of every kind and nature shall be delivered to, and become
the property of, Buyer. Each party shall have reasonable access to and the right to make extract
copies of all books, records, and documents referred to in this Agreement that are in the
possession of the other party.

7.      Compliance with Bulk Transfer Requirements
        Buyer shall give notice, in compliance with the applicable bulk transfer provisions of the
Uniform Commercial Code as enacted and in force in (Name of State) of the bulk transfer
contemplated by this Agreement. At least (number) days before the closing date, Seller shall
furnish Buyer with the information necessary to prepare the notice, including the names and
business addresses of all creditors of Seller and of all persons known to Seller to assert claims
against Seller, and the amount of indebtedness due and owing to each or claimed by each.



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8.      Closing
        The closing date shall be (date), and the closing shall take place on that date at (time), in
the offices of (Name of Buyer), at (street address, city, state, zip code), or at such other time and
place as the parties shall agree.

9.      Representations of Seller
        Seller represents, warrants, and agrees:

        A.      Seller is a corporation duly organized, existing, and in good standing under the
laws of (Name of State), and is authorized and entitled to carry on its business in (Name of State).
Seller is not qualified to do business in any other state. (Name of corporation) has no
subsidiaries. Its capital stock authorized and outstanding consists of (number) shares of common
stock.

        B.      The financial statements of Seller relating to the (number) months ending (date),
and the financial statements relating to the (number) months ending (date), each prepared by
independent public accountants for Seller and delivered to and reviewed by accountants for
Buyer during the course of the negotiations regarding this Agreement, fairly reflect the financial
position of Seller as of the end of those periods and the result of operations during those periods.

        C.      Seller have good and marketable title to all of the real property set forth and
described in Exhibit B, which is attached and incorporated by this reference. The real property is
free and clear of all mortgages, liens, and encumbrances and is not subject to any right-of-way,
easement, or restriction that interferes with the present use of the real property.

       D.       At least (number) days before the closing date, Seller will furnish to Buyer an
accurate list and summary description, certified by the Treasurer of Seller, of all machinery,
equipment, facilities, and other tangible assets in Seller’s plant and of all inventories of every
kind and nature, all of which are free and clear of all mortgages, liens, and encumbrances.

        E.     All assets and properties that were used in the business of Seller on the date of
this Agreement, or that were reflected in the balance sheet dated (date of balance sheet), which
are described and set forth in Exhibit D are owned by Seller, free and clear of all mortgages,
liens, and encumbrances.

        F.     Seller is the owner of U.S. Patent No. _________ (dated) date, free and clear of
any liens, encumbrances, or licenses. Seller has no knowledge of pending or threatened claims of
infringement or interference involving this Patent.

        G.      Seller is not a party to any employment agreement, labor-union agreement,
agreement for the future purchase of materials, supplies, or equipment, sales agreement, pension,
profit-sharing, or retirement plan or agreement, distributorship or sales agency agreement, or
lease agreement that relates to any period beyond the closing date, whether written or oral,
except as listed in Exhibit F. Copies of all such written agreements have been supplied to Buyer,
and Buyer has been advised of the terms of all such oral agreements.



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       H.      Seller enjoys a very good relationship with (Name of Customer), and there has
been no significant difficulties experienced that would indicate that this good relationship will
not continue past the closing date. Seller has not now, nor has it ever had, any Agreement,
arrangement, or understanding with (Name of Customer) with respect to discriminatory
allowances, preferential or special terms of sale, or exclusive dealing or special delivery terms,
and nothing has been done or said by any of Seller to cause (Name of Customer) to expect any
such special conditions as a prerequisite for its continued purchase of products from (Name of
Corporation) or its successor corporation.

       I.       Seller is not in default under any contract, Agreement, lease, or other document to
which it is a party, and has complied with all laws, regulations, and ordinances applicable to its
business to the date of this Agreement.

        J.       Since (date), the date of the Balance Sheet set out in Exhibit C, Seller has not
issued any stock, bonds, or other corporate securities, incurred any obligations or liability except
current liabilities in the ordinary course of business, declared or made any payment or
distribution to stockholders, purchased or redeemed any shares of capital stock, mortgaged or
pledged any of its assets, tangible or intangible, sold or transferred any assets or cancelled any
debts or claims except in the ordinary course of business, sold, assigned, or licensed any patents,
trademarks, or trade names, suffered any extraordinary losses or waived any rights except in the
ordinary course of business, or entered into any other transaction except in the ordinary course of
business.

       K.      Since (date), the date of the balance sheet set out in Exhibit C, there has been no
substantial change in the financial policies, account relations, or marketing activities of Seller.

       L.      Seller’s accounts receivable as reflected in its Balance Sheet as of (date), set forth
in Exhibit C, and as later acquired prior to the closing date, will be collectible to the extent that
they exceed $__________________.

       M.       Since (date), the date of the Balance Sheet set out in Exhibit C, there has been no
substantial loss of value in any of the physical assets or properties of Seller used in Seller’s
business, ordinary wear and tear excepted.

        N.       On the closing date Seller change its name to a dissimilar name.

10.    Conditions Precedent to Buyer’s Obligations
       The obligations of Buyer under this Agreement are conditioned on the following all
having occurred on or before the closing date:

        A.    All actions, proceedings, instruments, and documents required of Seller under this
Agreement shall be in a form approved by counsel for Buyer, provided that such approval shall
not be unreasonably withheld.




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        B.      The representations and warranties made by Seller in this Agreement shall be
substantially correct on the closing date, except as affected by transactions contemplated in this
Agreement and changes occurring in the ordinary course of business, with the same force and
effect as though the representations and warranties had been made on the closing date.

        C.       The instruments executed and delivered to Buyer by each of Seller pursuant to
this Agreement are valid in accordance with their terms, and effectively vest in Buyer good and
marketable title to the assets and business as contemplated by this Agreement, free and clear of
any liabilities, obligations, and encumbrances, except those liabilities and obligations expressly
assumed by Buyer as provided in this Agreement.

11.     Broker’s Fees
        Buyer shall compensate (Name of Broker) for its assistance in arranging this sale. Each
party represents and warrants to each other party that no other person or firm brought about the
sale or is entitled to compensation in respect to it.

12.     Employment of Major Shareholder of Seller
        Buyer shall employ (Name of Majority Shareholder), hereinafter called Shareholder for a
period of (number) years beginning on the closing date for an aggregate remuneration of
$_____________ payable in _____ equal monthly installments over a period of _____ months.
Shareholder shall accept such employment, and make himself available, on a full-time basis, to
perform services comparable in scope and nature to those that Shareholder has previously
performed for (Name of Corporation). Further, any patents or patent applications, whether
domestic or foreign, any inventions, whether developed or in the process of development, any
research and development projects, and any designs and processes that relate to (type of
enterprise) that Shareholder may develop during his period of employment shall belong to and
be the property of Buyer. At the end of the prescribed term, either party may terminate the
employment relationship, or it may be extended subject to such modifications as may be agreed
on by both parties.

13.     Expenses of Negotiation and Transfer
        Each party shall pay the party's own expenses, taxes, and other costs incident to or
resulting from this Agreement, whether or not the transactions contemplated are consummated.
The costs of Seller shall include the preparation of documents of transfer and documentary stamp
taxes. Buyer's costs shall include fees for the filing or recording of instruments of transfer.

14.    Notices
       Any notice to be given under this Agreement shall be given in writing and delivered
personally or by registered or certified mail, postage prepaid, as follows:

         A.      If to Buyer, addressed to: (Name of Officer), at (street address, city, state, zip
code).

         B.      If to Seller, addressed to: (Name of Officer), at (street address, city, state, zip
code).




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15.     Severability
        The invalidity of any portion of this Agreement will not and shall not be deemed to affect
the validity of any other provision. If any provision of this Agreement is held to be invalid, the
parties agree that the remaining provisions shall be deemed to be in full force and effect as if
they had been executed by both parties subsequent to the expungement of the invalid provision.

16.    No Waiver
       The failure of either party to this Agreement to insist upon the performance of any of the
terms and conditions of this Agreement, or the waiver of any breach of any of the terms and
conditions of this Agreement, shall not be construed as subsequently waiving any such terms and
conditions, but the same shall continue and remain in full force and effect as if no such
forbearance or waiver had occurred.

17.    Governing Law
       This Agreement shall be governed by, construed, and enforced in accordance with the
laws of the State of __________.

18.     Attorney’s Fees
        In the event that any lawsuit is filed in relation to this Agreement, the unsuccessful party
in the action shall pay to the successful party, in addition to all the sums that either party may be
called on to pay, a reasonable sum for the successful party's attorney fees.

19.     Mandatory Arbitration
        Any dispute under this Agreement shall be required to be resolved by binding arbitration
of the parties hereto. If the parties cannot agree on an arbitrator, each party shall select one
arbitrator and both arbitrators shall then select a third. The third arbitrator so selected shall
arbitrate said dispute. The arbitration shall be governed by the rules of the American Arbitration
Association then in force and effect.

20.    Entire Agreement
       This Agreement shall constitute the entire agreement between the parties and any prior
understanding or representation of any kind preceding the date of this Agreement shall not be
binding upon either party except to the extent incorporated in this Agreement.

21.     Modification of Agreement
        Any modification of this Agreement or additional obligation assumed by either party in
connection with this Agreement shall be binding only if placed in writing and signed by each
party or an authorized representative of each party.

22.    Assignment of Rights
       The rights of each party under this Agreement are personal to that party and may not be
assigned or transferred to any other person, firm, corporation, or other entity without the prior,
express, and written consent of the other party.

23.     Counterparts




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       This Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute but one and the same
instrument.

24.     Compliance with Laws
        In performing under this Agreement, all applicable governmental laws, regulations,
orders, and other rules of duly-constituted authority will be followed and complied with in all
respects by both parties.

        WITNESS our signatures as of the day and date first above stated.
(Name of Seller)                                        (Name of Buyer)


By:____________________________                    By:_______________________________
(Printed Name & Office in Corporation)                (Printed Name & Office in Corporation)
(Signature of Officer)                                  (Signature of Officer)

Attach Exhibits




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DOCUMENT INFO
Description: This agreement for the sale of substantially all of the assets of a corporation (Asset Purchase Agreement) is used when a corporation is liquidating and selling its assets to a third party. The agreement sets forth the terms of the sale and includes provisions regarding purchase price, closing date, assumption of liabilities and assignment of rights. This document contains numerous of the standard clauses commonly found in asset purchase agreements and can be customized to address the specific needs of the contracting parties. This agreement should be utilized by a business owner or partners planning to sell a business or corporation.