Purchased Assets

The top level:

The "Purchased Assets" section outlines what’s included in the sale, including equipment, inventory, and contracts, so there are no surprises later.

  • The Purchased Assets definition dictates which assets will be purchased as part of the transaction. In more specific terms, this section creates a duty for the Seller to transfer certain assets to the Buyer and lists those assets in detail. The parties should pay special attention to whether the list is all-inclusive or whether the Purchased Assets include all assets not specifically listed as Excluded Assets, as that distinction will determine how exhaustive and precise the list of Purchased Assets needs to be.

  • Subject to the terms and conditions set forth herein, at the Closing, Seller hereby agrees to sell, transfer, assign and deliver to Purchaser, and Purchaser hereby agrees to purchase from Seller, all right, title, ownership and interest in the Purchased Assets, free and clear of all Encumbrances, except for Permitted Encumbrances. The “Purchased Assets” means all of the assets, properties, rights, privileges, and claims of Seller of every kind and nature, real and personal, tangible and intangible, absolute or contingent, wherever located, to the extent such Purchased Assets are in any way associated or used in connection with or related to the Business, including without limitation the assets set forth in Exhibit B (the “Asset Schedule”), but expressly excluding the Excluded Assets. The Purchased Assets shall include, without limitation, the following assets of Seller: [the Agreement then goes on to list specific categories of assets].

How this could blow up…

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Just a little placeholder video — could be cool to have an explainer video/audio with art cards, etc. to break up the text.

In Negotiations

What the Buyer Wants

  • Broad definitions of various Purchased Assets to ensure that it receives, at a minimum, all the assets it intends to purchase

  • Potentially, assets not yet owned by the Seller

  • Language stating that all assets are being transferred free and clear of any Encumbrances (except for Permitted Encumbrances)

What the Seller Wants

  • Definitions of the Purchased Assets that are as narrow as possible to avoid having to transfer assets it does not intend to sell

  • Asset definitions that exclude any assets the Seller does not have the authority to transfer, as well as assets the Seller needs to retain to operate its remaining lines of business (if it is only selling a division or line of business)

What the Middle Might Look Like

Depending on the particular business, the Purchased Assets will likely include accounts receivable, inventory, certain contracts, intellectual property, real and personal property, permits, certain rights held by the Seller, the Seller’s accounting-related books and records, and the goodwill of the Business.