Docstoc

Business Intent Agreement

Document Sample
Business Intent Agreement Powered By Docstoc
					This Business Letter Agreement is addressed to the Seller of business by the
Purchaser. The Letter of Intent sets out both parties intent to enter into an agreement
for a purchase and sale of a business. Additionally, this Business Intent Letter sets out
the provisions which are to be contained in the agreement such as the purchase price,
deposit to be paid and closing date. This document contains both standard language
and terms, as well as opportunities to add additional language to ensure that the needs
of both the Seller and Purchaser are met. Use this form if one is a Seller with the intent
to sell a business or if one is a Purchaser with the intent to buy a business.
                           [Instruction: insert Buyer’s letterhead]
                         LETTER OF INTENT—BUSINESS
Date: ______________ [Instruction: insert date]

___________________
___________________
___________________
[Instruction: insert vendor’s name and address]

       Re:   _____________________ [Instruction: insert Vendor’s name] Sale of Assets to
       _____________________ [Instruction: insert Buyer name]

Dear _______________: [Instruction: insert name]

Further to our various discussions regarding the sale of the assets of the _______________
[Instruction: insert the name of the business that is being sold] (the “Business”) by
_________________ [Instruction: insert Vendor’s name] (the “Vendor”) to
_________________ [Instruction: insert Buyer’s name] (the “Buyer”) and for purposes of
facilitating the final negotiation and preparation of a definitive agreement of purchase and sale
(the “Agreement”), we are pleased to provide you with this Letter of Intent (the “Letter”)
outlining our understanding of the general agreements and understandings resulting from our
discussions.

1.     Upon acceptance of this Letter and as indicated below, Buyer shall instruct its attorneys,
       _____________________, [Instruction: insert Buyer’s attorney’s name] to prepare the
       Agreement containing all such terms as shall be necessary to give effect to the
       agreements and understandings hereby contemplated.

2.     Upon final execution of this Agreement, Buyer shall pay a deposit of _______________
       dollars ($__________) [Instruction: insert deposit amount] to Vendor’s attorneys to be
       held in trust pending the closing of the transaction and to be credited toward the purchase
       price upon closing.

3.     Buyer shall also purchase such of the inventory of the Business which, as of the date of
       closing, is current, undamaged, and otherwise acceptable to Buyer at Vendor’s original
       cost. Vendor represents that the inventory value, based on Vendor’s cost, will be
       approximately _________________ dollars ($_____). [Instruction: insert inventory
       value]

4.     Buyer shall purchase for the sum of ______________ dollars ($____) [Instruction:
       insert purchase price] all of the fixed and movable assets of the Business including
       those enumerated in Schedule “A” attached hereto as well as all ongoing and future
       product sales contracts.

5.     Buyer shall purchase for the sum of ______________ dollars ($______) [Instruction:
       insert purchase price for all intangible assets and goodwill] all intangible assets and
      goodwill of the Business including, all customer lists, Vendor’s operating/business name
      (__________________ [Instruction: insert the name of the business that is being
      sold]), and any other brand names and trademarks of the Business, its websites, telephone
      listings and sales contracts.

6.    The amounts payable in respect of the purchase price shall be paid in cash on closing
      subject to the usual adjustments, if any.

7.    Buyer shall enter into a lease of the premises at which the Business now operates for a
      term of ______ (___) [Instruction: insert number of years] years with a ______ (____)
      [Instruction: insert number of years] year renewal option at the current rental rate.

8.    The assets being purchased shall not include accounts receivables and Buyer shall not
      assume any obligations of the Business including leases (save and except for the existing
      leases of photocopiers and computer equipment with __________________ [Instruction:
      insert name of leasing company], which the Buyer agrees/does not agree [Instruction:
      select one] to assume, subject to appropriate adjustments), encumbrances of any kind,
      inventory and other supply contracts, maintenance contracts, employment contracts,
      debts, or other obligations of any other kind. Vendor shall further indemnify and hold
      Buyer harmless from all such obligations and liabilities. Notwithstanding the foregoing,
      Buyer will cooperate with and assist Vendor as Vendor may reasonably require and at
      Vendor’s sole expense with the collection of outstanding accounts receivable after
      closing.

9.    The transaction shall close on _________________ [Instruction: insert date] and
      inventory shall be taken following the close of business on _______________
      [Instruction: insert date].

10.   Each of the shareholders of Vendor shall enter into a non-competition agreement with
      Buyer whereby they agree not to compete, directly or indirectly, with Buyer in the
      continuation of the Business for a period of ________ (___) [Instruction: insert number
      of years] years. Each of the shareholders shall also guarantee the representations,
      warranties, covenants, and indemnities to be made by Vendor.

11.   Vendor shall be responsible for terminating the employment of all employees of the
      Business including any severance and pay in lieu of notice costs associated with such
      termination. Notwithstanding the foregoing and prior to closing, Buyer agrees to review
      the employment terms and job descriptions of each of Vendor’s employees, other than
      those of shareholders and related individuals, and provided, in the sole and unfettered
      opinion of Buyer, the employment terms and job descriptions are reasonable and
      consistent with Buyer’s business plans and requirements and upon Vendor’s
      representations and warrants that each has a good record of employment, Buyer shall
      assume the existing employment obligations of Vendor with respect to such employees
      and not hire new employees or substitute existing Buyer employees.




© Copyright 2013 Docstoc Inc.                                                         3
12.   Buyer shall be permitted to assign its rights and obligations under the Agreement to any
      corporation associated with Buyer but such assignment shall not relieve Buyer of its
      obligations under the Agreement.

13.   The Agreement shall contain such covenants, representations, warranties, conditions and
      indemnities as are usual in a transaction of the nature as contemplated herein including,
      that all material facts relevant to the transaction have been disclosed to Buyer and that
      there are no facts or information available that have not been disclosed which, if
      disclosed, would dissuade Buyer from proceeding with the transaction.

14.   Immediately upon acceptance of the Agreement, Vendor shall make available to Buyer’s
      representatives, for inspection at Vendor’s offices during regular business hours, all
      corporate minute books, financial and other business and corporate records and
      information as Buyer may reasonably require to complete the due diligence it deems
      necessary to confirm the representations made on behalf of Vendor regarding the nature,
      revenues, and viability of the Business.

15.   All information disclosed by one party to the representatives and professional advisers of
      the other shall be deemed confidential and proprietary and shall be held in strict
      confidence by the other, save and except to the extent disclosure to other professionals is
      required for the purposes of providing advice with respect to the transactions herein
      contemplated. In the event that the transactions herein contemplated do not proceed,
      each party shall return to the other all documents and data in whatever format received
      from the other or subsequently converted.

16.   Vendor’s attorneys shall deliver to Buyer and its attorney in such form as they may
      reasonably require, such opinions as to corporate status and powers, due execution of
      documents and agreements, and title of assets as Buyer’s attorneys may reasonably
      require so as to satisfy themselves as to matters governed by the laws of the State of
      _______________ [Instruction: insert the applicable state] and for which the opinion
      of an attorney qualified to practice in the State of _________________ [Instruction:
      insert the applicable state] is required. Buyer’s attorneys shall deliver to Vendor’s
      attorneys, upon closing, their opinion as to corporate status, requisite corporate powers,
      and due execution and delivery of the Agreement and other closing documents.

17.   The parties agree to co-operate fully and in good faith with each other to negotiate and
      execute the Agreement on or before _____________________. [Instruction: insert
      date]

18.   This Letter and the Agreement contemplated herein shall be governed by the laws of the
      State of _________________. [Instruction: insert the applicable state]

19.   Save and except for Paragraphs 17 and 18 above, this Letter is neither intended to bind
      nor shall it be deemed binding on either Party but, rather, shall be subject to the
      negotiation and execution of a definitive Agreement on or before
      _____________________ [Instruction: insert date], failing which the obligations of the
      parties, pursuant to this Letter, to negotiate the terms of the Agreement.



© Copyright 2013 Docstoc Inc.                                                           4
We trust you will find the foregoing satisfactory and, accordingly, ask that you indicate your
consent and agreement to the foregoing by signing below and returning to Buyer via facsimile at
(_____) _____________ [Instruction: insert the Buyer’s fax number] no later than ______
p.m. on _________________ [Instruction: insert the date] [Comment: user may choose a
different means of communication] after which time our obligations hereunder shall terminate
and be of no further force or effect.

Yours truly,


_________________________
[Instruction: insert name and title of individual who is sending this letter]



AGREED AND ACCEPTED:

The undersigned hereby accepts and agrees to the foregoing this ____ day of ____________,
2____.

Per:
______________________________
Name: ______________________
Title: _______________________
I have authority to bind the ____________________.
[Instruction: insert name of company]




© Copyright 2013 Docstoc Inc.                                                         5
                                   SCHEDULE “A”
                                      ASSETS


1.    ___________________________________________________________________
2.    ___________________________________________________________________
3.    ___________________________________________________________________
4.    ___________________________________________________________________
5.    ___________________________________________________________________
6.    ___________________________________________________________________



                         [Comment: insert description of assets]




© Copyright 2013 Docstoc Inc.                                          6

				
DOCUMENT INFO
Description: This Business Letter Agreement is addressed to the Seller of business by the Purchaser. The Letter of Intent sets out both parties intent to enter into an agreement for a purchase and sale of a business. Additionally, this Business Intent Letter sets out the provisions which are to be contained in the agreement such as the purchase price, deposit to be paid and closing date. This document contains both standard language and terms, as well as opportunities to add additional language to ensure that the needs of both the Seller and Purchaser are met. Use this form if one is a Seller with the intent to sell a business or if one is a Purchaser with the intent to buy a business.
This document is also part of a package Getting Small Business Loans 4 Documents Included