The basic template below can be used as a starting point for drafting a contract to purchase a website, mobile app and/or other digital assets. One common pitfall for a buyer to avoid is to ensure that the contract makes it clear that the buyer is buying only the assets and not any unnecessary liabilities. The longer the asset has been in business the more important this provision is.
ASSET
PURCHASE AGREEMENT
THIS ASSET
PURCHASE AGREEMENT (the “Agreement”) is made this ____ day of ______________, 2019 (the “Effective Date”) by and between __________________. (the "Seller"), and _______________
(the "Buyer"). The parties
agree as follows:
1.
Purchased Assets.
Buyer
agrees to purchase, and Seller agrees to sell, free from all liabilities and
encumbrances, all Seller's rights, title and interest, if any, in and to the
Purchased Assets, as defined in this paragraph. "Purchased
Assets" listed in Exhibit A include all right, title and interest of
Seller in intellectual property, telephone numbers, accounts receivable ("Accounts"), all causes of
action related to the Purchased Assets, customer lists and goodwill.
2.
Purchase Price.
a.
The total purchase price for the
Purchased Assets shall be $____________ (the "Purchase Price").
b.
Buyer shall deliver the Purchase Price
to Seller as follows:
i.
Down payment of $_________ due at Closing, and
ii.
The remaining balance of $___________ will be paid every
two weeks in installments that equal 10% of the Gross Sales. “Gross Sales” shall mean all sales generated
by the Purchased Assets minus administrative costs that shall not exceed $_______
per month.
3.
Assumption of Liabilities.
At
Closing Buyer shall assume and agree to pay, discharge or perform as
appropriate only the following liabilities and obligations (the "Assumed Liabilities") and
only to the extent such liabilities and obligations were disclosed to Seller
prior to execution of this Agreement:
a.
Obligations under existing customer
purchase orders;
b.
Agreements with vendors providing
services to the business (e.g., web hosting services) after the Closing date.
Except
for the Assumed Liabilities, Buyer is not assuming, nor shall it in any way be
liable or responsible for, any liabilities, obligations or debts of Seller,
whether accrued, absolute, contingent or otherwise, arising before or after the
Closing.
4.
Covenants of Seller.
Seller
hereby covenants and agrees with Buyer that:
a.
Until the Closing, Seller shall use
best efforts to maintain current relationships with suppliers, customers and
others having business relations with Seller in connection with the Purchased
Assets.
b.
Until the Closing, except as may be
first approved in writing by Buyer or as is otherwise permitted or contemplated
by this Agreement, Seller shall conduct its business and all transactions with
respect to the Purchased Assets, only in the usual and ordinary course of
business consistent with Seller's past practice.
c.
Until the Closing, Seller shall make no
sale of assets.
5.
Non-Compete.
Seller
shall not engage in the business of _____________________ in any capacity,
directly or indirectly, anywhere in _____________________ for a period of two
(2) years from the date of Closing.
6.
Closing.
a.
The consummation of the purchase and
sale of the Purchased Assets (the "Closing")
shall be held on ___________________,
2019 or sooner by agreement of the parties, at such place as Buyer and Seller
may agree.
b.
At the Closing:
i.
Seller shall deliver to Buyer access to
the Purchased Assets
ii.
Each party hereto will deliver to the
other party executed counterparts of this Agreement and such other documents as
may be reasonably requested by that other party in connection with the
consummation of the transactions contemplated by this Agreement.
7.
Indemnity.
Each
party shall indemnify, defend and hold the other party harmless from and
against any and all losses, liabilities, damages, costs and obligations (or
actions or claims in respect thereof) (including reasonable counsel fees),
arising out of or based upon:
a.
The indemnifying party’s breach of any
representation, warranty or covenant contained in this Agreement;
b.
The Purchased Assets.
8.
Notices.
Any
notice required or permitted by this Agreement shall be in writing and
effectively delivered for all purposes if delivered personally, by overnight
delivery service or by United States mail, certified mail, postage prepaid,
return receipt requested and:
If
directed to Seller:
If
directed to Buyer:
9.
Brokers.
Buyer
and Seller each warrants to the other that it has not engaged, consented to, or
authorized any broker, investment banker, or other third party to act on its
behalf, directly or indirectly, as a broker or finder in connection with the
transactions contemplated by this Agreement and no such third party is entitled
to any fee or compensation in connection with this Agreement or the
transactions contemplated hereby by reason of any action of it.
10.
Amendment and Modification.
This
Agreement may be amended, modified or supplemented only by written agreement signed
by the Party sought to be charged with an amendment.
11.
Severability.
Any
provision of this Agreement that shall be prohibited or unenforceable shall be
deemed ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof.
12.
Entire Agreement.
This
Agreement sets forth all of the promises, covenants, agreements, conditions and
undertakings between the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements and
undertakings, inducements or conditions, express or implied, oral or written.
13.
Governing Law and Arbitration.
Any controversy or claim arising out of or relating to this Agreement,
or the breach thereof, shall be settled by arbitration administered by the
American Arbitration Association in accordance with its Commercial Arbitration
Rules and judgment on the award rendered by the arbitrator(s) may be entered in
any court having jurisdiction thereof.
The place of arbitration shall be ____________. The arbitration shall be governed by the laws of [INSERT STATE]. Except as may be required by law, neither a party nor an arbitrator may disclose the existence, content, or results of any arbitration hereunder without the prior written consent of both parties. Parties understand that this Section means that, by agreeing to arbitrate, they waive their rights to sue in court and have a jury trial.
The place of arbitration shall be ____________. The arbitration shall be governed by the laws of [INSERT STATE]. Except as may be required by law, neither a party nor an arbitrator may disclose the existence, content, or results of any arbitration hereunder without the prior written consent of both parties. Parties understand that this Section means that, by agreeing to arbitrate, they waive their rights to sue in court and have a jury trial.
14.
Counterparts.
This Agreement may be executed in one or more
counterparts all of which when taken together constitute one and the same
instruments. A signed counterpart is as binding as an original.
15.
Headings.
The
headings used in this Agreement are for convenience only and shall not be used
to limit or construe the contents of any of the sections of this
Agreement.
16.
Binding Effect.
This
Agreement shall be binding upon and inure to the benefit of the parties hereto,
their successors and assigns.
IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the Effective Date.
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SELLER:
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BUYER:
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By: _______________________________
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By: ____________________________
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Name/Title _________________________
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Name/Title ______________________
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Date: _____________________________
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Date: __________________________
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EXHIBIT A
PURCHASED ASSETS
1. _____________.com
2. ______________
mobile application
3. _______________
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SELLER:
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BUYER:
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By: _______________________________
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By: ___________________________
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Name/Title _________________________
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Name/Title _____________________
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Date: _____________________________
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Date: __________________________
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STATE OF [INSERT STATE]
COUNTY OF ________________
The foregoing instrument was
acknowledged before me this ____ day of ____________, 2019 by _________________________________
who is personally known to me or who has produced
___________________________________ as identification.
________________________________
Notary
Public
________________________________
My
Commission Expires
STATE OF [INSERT STATE]
COUNTY OF ________________
The foregoing instrument was
acknowledged before me this ____ day of ____________, 2019 by _________________________________
who is personally known to me or who has produced
___________________________________ as identification.
________________________________
Notary
Public
________________________________
My
Commission Expires
