Purchasing assets allows buyers to divide the purchase price between the assets to reflect their market value. This increases depreciation deductions that result in future tax savings. A simple asset sale contract is used when a transaction is concluded, during which the company`s assets are sold to a buyer. This buyer can buy all or only a portion of the assets. The contract can be as simple as giving the buyer a sales invoice. The sale of trademarks or intellectual property and real estate transfers often requires legal support and more complex structuring. Even if only a portion of the assets sold, a contract should be entered into to list all parties involved. In addition, there may be important contracts that are not transferable or some licenses and authorizations may be clear to the seller. Sometimes a buyer wants to get as many customer relationships as possible, so he can choose to buy shares as opposed to assets.
The transfer of businesses (employment protection) (TUPE) protects the rights of workers in the event of a transfer of assets from a company. The basic principle of TUPE is that when a seller buys the company`s assets as a “current business,” the employees of that company are automatically transferred to the buyer. On this basis, the buyer and seller must contact the relevant staff at an early stage. A proposed sales contract is a contract to buy and sell a company`s assets. It may be used for tangible assets such as furniture, supplies or real estate, as well as intangible assets such as liabilities or a customer database. The asset sale contract can be extended in detail to the terms of purchase, the terms of the trust and the price. The stock of facilities can also be mentioned here. The seller and buyer agree to certain conditions in an asset purchase agreement. For advice when passing on staff and TUPE as part of an asset purchase, you can ask a lawyer at any time.
All warranties for goods that have been shipped must also be included in the contract, including the language in which the duration of the company`s liability for damage to the goods delivered is discussed. All additional provisions related to a sale must be clearly defined in the agreement. A certain closing period should be indicated, as well as the time and place when the parties meet to complete the transaction. All assets that are part of the transaction but are not part of the sale should be mentioned so that there is no confusion about the agreement. THIS purchase and sale agreement (the agreement) is presented in two original copies from [Date]. SUBJECT-MATTER 1.1 The buyer agrees to buy and the seller agrees to sell to the buyer, as a current entity, all businesses and assets belonging to the seller in connection with the transaction [TYPE OF BUSINESS], which will be kept under [YOUR COMPLETE ADDRESS] under [COMPLETE YOUR ADDRESS], including without limitation of the universality of the above: The tangible assets may be mentioned or separately. These include office furniture, computer science, literature, inventory, telephone systems, tools and devices. The terms of the sale and the price must be specified in the contract. A particular language should be used in the simple assist sale contract, in which the buyer`s liability for liabilities that may be linked to the assets is discussed. If invoices are still available with suppliers or suppliers, it is appropriate to agree, before the closing of the sale, if the buyer is taking over the debts.
This document is usually executed in the case of mergers and acquisitions when a company acquires either the assets and/or shares of the company, or when the buyer wishes to acquire the assets of a business in order to expand its own business.