ASSET PURCHASE AGREEMENT
between
[SELLER NAME]
and
[BUYER NAME]
dated as of
[Date]
Table of Contents
ARTICLE I - DEFINITIONS AND CONSTRUCTION
Section 1.1 - Definitions
Section 1.2 - Additional Definitions
Section 1.3 - Certain References and Construction
ARTICLE II - PURCHASE AND SALE OF ASSETS
Section 2.1 - Purchase and Sale of Assets
Section 2.2 - Excluded Assets
Section 2.3 - Assumed Liabilities
Section 2.4 - Retained Liabilities
Section 2.5 - Limitation on the Assignment of the Acquired Assets
ARTICLE III - PURCHASE PRICE; CLOSING
Section 3.1 - Closing
Section 3.2 Consideration
Section 3.3 - Closing Payments and Issuances; Payoff Letters; Funds Flow
Section 3.4 Post-Closing Adjustment
Section 3.5 Tax Treatment of the Contemplated Transactions; Allocation of the Purchase Price
Section 3.6 - Transactions Effected at the Closing
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF THE SELLER PARTIES
Section 4.1 Organization and Qualification
Section 4.2 Power and Authority
Section 4.3 - Noncontravention; Consents
Section 4.4 - Capitalization; Subsidiaries
Section 4.5 - Financial Statements and Bank Accounts
Section 4.6 - Undisclosed Liabilities
Section 4.7 - Absence of Changes
Section 4.8 - Legal Proceedings
Section 4.9 - Compliance With Laws; Permits
Section 4.10 - Material Contracts
Section 4.11 - Title, Sufficiency and Condition of Assets
Section 4.12 - Real Property
Section 4.13 - Environmental Matters
Section 4.14 - Employee Matters
Section 4.15 - Employee Benefits
Section 4.16 - Taxes
Section 4.17 - Intellectual Property
Section 4.18 - Privacy and Data Security
Section 4.19 - Customers; Suppliers
Section 4.20 - Inventory
Section 4.21 - Accounts Receivable; Accounts Payable
Section 4.22 - Insurance
Section 4.23 - Related Party Transactions
Section 4.24 - Solvency; No Fraudulent Conveyance
Section 4.25 - Customer Credits
Section 4.26 - Brokers
ARTICLE V - REPRESENTATIONS AND WARRANTIES OF PURCHASER
Section 5.1 - Organization and Qualification
Section 5.2 - Power and Authority
Section 5.3 - Noncontravention; Consents
Section 5.4 - Legal Proceedings; Orders
Section 5.5 - Brokers
ARTICLE VI - COVENANTS
Section 6.1 - Employment Matters
Section 6.2 - Use of Name
Section 6.3 - Collection of Accounts Receivable; Wrong Pockets
Section 6.4 - Data Rool
Section 6.5 - Public Announcement
Section 6.6 - Tax Matters
Section 6.7 - Bulk Sales
Section 6.8 - Solvency
Section 6.9 - Insurance Matters
Section 6.10 - Further Assurances
Section 6.11 - Pending Legal Proceedings
ARTICLE VII - INDEMNITY
Section 7.1 - Survival
Section 7.2 - Indemnification by the Seller Parties
Section 7.3 - Indemnification by Purchaser
Section 7.4 - Certain Limitations
Section 7.5 - Indemnification for Third Party Claims
Section 7.6 Indemnification Procedures for Direct Claims
Section 7.7 - Payment
Section 7.8 - Tax Treatment
Section 7.9 - Exclusive Remedies
Section 7.10 - Special Rule for Fraud or Willful Breach
ARTICLE VIII - MISCELLANEOUS
Section 8.1 - Entire Agreement
Section 8.2 - Notices
Section 8.3 - Severability
Section 8.4 - Third Party Beneficiaries
Section 8.5 - Assignment
Section 8.6 - Amendments and Waivers
Section 8.7 - Governing Law
Section 8.8 - Consent to Jurisdiction; Waiver of Jury Trial
Section 8.9 - Equitable Remedies
Section 8.10 - Expenses
Section 8.11 - Counterparts
Asset Purchase and Contribution Agreement
THIS ASSET PURCHASE AND CONTRIBUTION AGREEMENT (this “Agreement”) is made and entered into as of [DATE] (the “Effective Date”), by and among [SELLER NAME], a [STATE OF ORGANIZATION] corporation ("Seller") and [BUYER NAME], a [STATE OF ORGANIZATION] corporation ("Buyer").
Recitals
WHEREAS, Seller is engaged in the business of…
WHEREAS, on the terms and subject to the conditions set forth in this Agreement and the other Transaction Documents, Seller desires to sell and contribute, and Purchase desires to purchase and accept, substantially all of Seller’s assets, properties, rights and interests used or held for use in connection with the Business in consideration of certain cash payments and equity issuances by Purchaser, and the assumption by Purchaser of certain specified Liabilities, in each case as more fully set forth in this Agreement (the “Contemplated Transactions”);
WHEREAS, XYZ direct and indirect benefits will stem from the Contemplated Transactions…
NOW, THEREFORE, in consideration of the foregoing, the representations, warranties, covenants, and mutual agreements hereinafter contained, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged the Parties, intending to be legally bound, hereby agree as follows:
Agreement
ARTICLE I
DEFINITIONS AND CONSTRUCTION
Section 1.1. Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to such terms as set forth below.
“Accounts Payable” means the trade accounts payable of Seller, to the extent payable to unrelated and unaffiliated third parties incurred in connection with the Ordinary Course of Business.
“Accounts Receivable” means all accounts receivable, notes receivable, rights to payment from third parties and other amounts payable to Seller in connection with the operation of the Business, together with all unpaid interest accrued thereon, if any.
“Affiliate” of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. The term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, or the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by Contract or otherwise.
...
“Working Capital Principles” means the working capital principles set forth on [EXHIBIT], attached hereto and incorporated herein by this reference.
Section 1.2 - Additional Definitions. The following terms shall have the meanings provided for such terms in the sections set forth below:
Defined Term Section
Acquired Assets 2.1(a)
Active Employees 4.14(a)
Agreement Introduction
Annual Financial Statements 4.5(a)
…
Trust Certificates 3.6(a)
Section 1.3. Certain References and Construction.
(a) All article, section, schedule and exhibit references used in this Agreement are to articles, sections, schedules and exhibits to this Agreement unless otherwise specified.
(b) When calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded.
(c) Terms defined in the singular have the corresponding meanings in the plural, and vice versa. Unless the context of this Agreement clearly requires otherwise, words importing the masculine gender shall include the feminine and neutral genders and vice versa. The term “includes” or “including shall mean ”including without limitation.” The words “hereof,” “hereto,” “hereby,” “herein,” “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular section or article in which such words appear. Both the word “Dollars” and the symbol “$” mean United States Dollars.
(d) The table of contents, captions and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this agreement.
(e) The Parties have participated jointly in drafting and negotiating this Agreement. If an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision hereof.
ARTICLE II
PURCHASE, SALE, CONTRIBUTION, AND ACCEPTANCE OF ASSETS
Section 2.1. Purchase, Sale, Contribution, and Acceptance of Assets.
(a) On the terms and subject to the conditions set forth in this Agreement, at the Closing, Seller shall (i) sell, transfer, assign, convey and deliver to Purchaser, and Purchaser shall purchase, acquire, accept and assume from Seller, free and clear of all Encumbrances (other than Permitted Encumbrances) [PORTION] in all of Seller’s right, title and interest in, to and under all the assets, properties and rights of every kind and description (wherever located, real, personal or mixed, tangible or intangible (including goodwill)) owned, leased, licensed, used or held for use in or relating to the conduct of the Business, but excluding, for all purposes, the Excluded Assets (collectively, the “Purchased Assets”) and (ii) contribute, transfer, assign, convey and deliver to Purchaser, and Purchaser shall accept, acquire and assume from Seller, free and clear of all Encumbrances (other than Permitted Encumbrances) [PORTION] interest in all of Seller’s right, title and interest in, to and under all of the assets, properties and rights of every kind and description (wherever location, real, personal or mixed, tangible or intangible (including goodwill)) owned, leased, licensed, used or held for use in or relating to the conduct of the Business, but excluding, for all purposes, the Excluded Assets (collective, the “Contributed Assets”, and together with the Purchased Assets, the “Acquired Assets”).
(b) The Acquired Assets shall include, without limitation, all of the following (but excluding, for all purposes, the Excluded Assets):
(i) the Minimum Cash;
(ii) all Inventory and Accounts Receivable, in each case regardless of whether including Closing Working Capital;
(iii) …
Section 2.2. Excluded Assets. Notwithstanding anything to the contrary contained in Section 2.1 or elsewhere in this Agreement, Seller shall retain all right, title and interest in, to and under, and shall not sell, transfer, assign, contribute, convey or deliver to Purchaser any of its right, title and interest in, to and under any assets other than the acquired Assets, including, without limitation, the following assets, whetehr related to the Business or otherwise (collectively, the “Excluded Assets”):
(a) all Cash (excluding the Minimum Cash);
(b) any Contracts of any kind, other than the Assumed Contracts;
(c) any Seller Benefit Plans and any assets attributable thereto
(d) …
Section 2.3. Assumed Liabilities. On the terms and subject to the conditions set forth in this Agreement, at the Closing, Purchaser shall assume and agree to pay, honor, discharge or perform, as appropriate, in accordance with their respective terms, as Purchaser’s primary obligation, only the following Liabilities relating to the Business and/or the Acquired Assets (collectively, the “Assumed Liabilities”) and will not be responsible or liable for any other Liabilities or obligations of Seller or the Business:
(a) any Liabilities under the Assumed Contracts, but only to the extent that such Liabilities are required to be performed after the Closing Date, were incurred in the Ordinary Course of Business, and do not relate to any product warranty claims, or any failure to perform, improper performance, or any other breach, default or violation by Seller under the Assumed Contracts (whether claimed or alleged before or after the Closing Date;
(b) the Assumed Customer Credits;
(c) …
Section 2.4. Retained Liabilities. Notwithstanding anything to the contrary contained in this Agreement or any other Transaction Document, the Parties expressly agree that, except for the Assumed Liabilities, Purchaser will not assume and will not be obligated to assume, or be required to pay, perform or otherwise discharge, or in any other way be liable or responsible for any Liability of Seller of any nature whatsoever, all of which shall be retained by Seller, whether accrued or unaccrued, absolute or contingent, known or unknown, due or to become due, and regardless of whether or not any of the same have been disclosed to Purchaser and whether or not any of the same relate in any way to the conduct of the Business and/or the ownership, possession or use of the Acquired Assets (collectively, the “Retained Liabilities”_. Seller hereby covenants and agrees to pay, perform or otherwise discharge, or cause the Seller Parties to pay, perform or otherwise discharge, or make other provision for, all Retained Liabilities with no Liability to Purchaser of any kind. Without limiting the generality of the foregoing, the Retained Liabilities shall include, without limitation, the following liabilities:
(a) any Liability of Seller arising out of, relating to, or incurred in connection with this Agreement or any other Transaction Document and the Contemplated Transactions (including, all Transaction Expenses);
(b) all Liabilities arising out of or related to any Excluded Taxes;
(c) all Indebtedness;
(d) all Employment Liabilities;
(e) …
Section 2.5. Limitation on the Assignment of the Acquired Assets. If the assignment hereunder by Seller to Purchaser of any Assumed Contract or other Acquired Asset is not permitted or is not permitted without a Consent (collectively, the “Non-Assignable Acquired Assets”), this Agreement shall not be deemed to constitute an assignment of any such Non-Assignable Acquired Asset if such Consent is not given or received or if such assignment otherwise would constitute a breach of, or cause a loss of contractual benefits under, and Non-Assignable Acquired Asset, and Purchaser shall assume no obligations or Liabilities under any such Non-Assignable Acquired Asset…
ARTICLE III
PURCHASE PRICE; CLOSING
Section 3.1. Closing. The closing of the Contemplated Transactions (the “Closing”), shall take place…
Section 3.2. Consideration. The aggregate amount of consideration to be provided hereunder by Purchaser to Seller as consideration for the sale and contribution of the Acquired Assets and the timely performance of the covenants set forth in the Transaction Documents shall be (a) an amount equal to [AMOUNT], which amount shall be evidenced by the payment and/or delivery of the following by Purchaser to or for the benefit of Seller in accordance with Section 3.3: …
Section 3.3. Closing Payments and Issuance; Payoff Letters; Funds Flow. The aggregate amount of consideration to be provided hereunder by Purchaser to Seller as consideration for the sale and contribution of the Acquired Assets and the timely performance of the covenants set forth in the Transaction Documents shall be (a) an amount equal to [AMOUNT], which amount shall be evidenced by the payment and/or delivery of the following by Purchaser to or for the benefit of Seller in accordance with Section 3.3: …