Asset Sale and Purchase Agreement

An Asset Sale and Purchase Agreement is an agreement between a vendor and a purchaser regulating the terms and conditions of the sale and purchase of a company's assets.

The contents of an Asset purchase agreement includes the description of the assets, purchase price, condition precedents to the completion of the transaction, the closing date, obligations of the parties upon completion, and covenants of the parties to the agreement. This agreement also includes schedules for a detailed description of the assets and the covenants of the parties.

This document is usually executed in cases of mergers and acquisitions where an acquiring company either acquires the company's assets and/or shares or in cases where the purchaser wishes to acquire the assets of a company to expand their own business.

The Asset Sale and Purchase Agreement differ from a Share Sale and Purchase Agreement because, in the case of the share sale, the purchaser or investor acquires the shares in the company that owns the assets, while the purchaser in an asset sale acquires the assets of the company.

How to use this document

After completing this document, the parties to the agreement should sign the document. If either of the parties is a company, the common seal of the company should be affixed on the document, and at least two directors or one director and one secretary should sign the document.

If either party is an organization other than a company, an authorized representative of the organization should sign the document. Note that an authorized representative is a person in the position of office, for example, a general manager, managing partner, partner.

Once all the parties have signed the document, the parties are expected to keep at least one original signed copy of the document for their record.

Applicable law

The general rules of contract are apply to this document.

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