What Is An Asset Purchase Agreement?
Are you afraid that the agreement you make when buying or selling assets may not be fair and enforceable under the law? Your real estate lawyer can help make sure you are protected by drafting up an asset purchase agreement for you.
An asset purchase agreement (APA) is an agreement between a buyer and a seller that is used to transfer ownership of an asset that is usually drafted by your real estate lawyer. It specifies everything related to the purchase, including the price, payment plan and warranties. The seller decides what asset they are selling and what will be included in the APA. This agreement is meant to protect the buyer and seller from any liability and outlines the details of the transaction. The asset purchase agreement describes the specifics of the asset being purchased, as well as what is being excluded from the sale if all their business’s assets are not being sold. The agreement must also specifically state the terms under which the goods are being transferred, as well as include the rights and responsibilities of both the seller and buyer.
What does the asset purchase agreement cover?
- Interpretation: The agreement includes all key definitions for the important terminology in the document.
- Purchase and sale of stock: Includes the price of purchase, and any price adjustments between the seller and buyer regarding taxes.
- Representations and warranties: The seller and buyer acknowledge that the statements they are signing off on are true.
- Matters related to employees: Information and terms on how employee benefits and accrued bonuses should be handled after the sale has been made.
- Indemnifications: Provides details of all indemnifications for costs that may arise after the transaction as a result of conditions that existed before the deal closed.
- Tax matters: Outlines any taxes that need to be dealt with by either the seller or buyer after the sale has been made.
Who can you draft an asset purchase agreement?
You may be able to find templates online to help you draft your own asset purchase agreement; however, our Vancouver law firm strongly advises you to seek legal services as it is important to have as much detail and information as possible in this agreement. Using general terminology could leave room for grey areas in the agreement, creating loopholes that either the buyer or seller could take advantage of. Our experienced real estate lawyer can help you with your asset purchase agreements to help prevent any grey areas and ensure you are protected so that the process runs as smoothly as possible.
At Morris law, we can help make sure your asset purchase agreement is specific and detailed so that the selling and purchasing process is clear to all parties. Contact our Vancouver law firm to learn more about how we can help you with your asset purchase agreement.
