An asset purchase agreement template is an agreement between a seller and a buyer. In this contract, the seller accepts to transfer an asset they own at an agreed price. This agreement explains the type of assets a buyer should acquire. It also includes the terms and conditions that govern the asset acquisition.
Furthermore, the contract should have in-depth details on the transfer of ownership and the price of an asset. This is essential as it makes sure that you don’t face any hardships when the agreement is finalized. Below are the assets that are transferable in an asset purchase agreement;
- Plant and machinery
- Stock and bonds
- Real estate (investment or residential)
- Household furnishings
- Personal property
- Precious metals (silver, gold, etc.)
Elements of an asset purchase agreement:
Include the following essential elements in an asset purchase agreement;
In an asset purchase agreement, the date shows the day that a buyer obtained control over the assets of a business.
It is important to include a proper identification of the parties involved in an asset purchase agreement. The agreement should clearly determine the buyers and sellers and any other parties involved in the purchase.
Identity of assets
Asset identification is crucial. It makes it easier to identify the number of assets to purchase. Below are a few that you should know;
- Tangible assets: You should identify the tangible assets that you want to purchase. You have to be descriptive and specific as possible.
- Intangible assets: Also, you have a detailed record of intangible records. It may include things like goodwill, patents, account receivables, etc. Moreover, it is important to have proper records of such assets. This is because a business has intellectual and legal rights to them.
The asset price is a valuable component in an asset purchase agreement template that you want to acquire and how to pay.
This is a sale commitment you make with a seller that you’ll complete the full amount within a certain period of time. If you want to purchase an asset then don’t plan to make a deposit. You can show this by choosing the checkbox “A Deposit by the Buyer Is Not Required.”
This includes the survey and assessment that you make to identify the physical condition of an asset.
Provisions for payment
During making your payments, it is important to know the approaches to consider.
To cover the full amount, down payment will assist you gain ownership of an asset by making monthly payments.
An asset purchase agreement is between you and the seller. It includes the deadlines to meet and compensation to make.
The latest payment that you make on a debtor invoice before its considered overdue is known as payment due.
You should know how your transaction can be carried out before finalizing the purchase of an asset. In an asset purchase agreement, there are two common financing options that should be highlighted;
- Contingent payment
- Non-contingent payment
Before purchasing a company’s asset, you should identify whether you need third-party approval.
In the closing of the agreement, you should include the following information;
- Closing date
- Closing costs
- Conditions or requirements
- Quality of the asset
- Mediation and arbitration terms
This section includes the state laws governing your agreement. You have to make sure that you specify the state applicable in your agreement before finalizing your purchase agreement.
Signatures and date
In the end, affix the signatures of both the seller and the buyer and date the agreement. You should also check Purchase Order Template.
Sample Asset Purchase Agreement Template
Bill of Sale and Assignment and Assumption Agreement
Free Asset Purchase Agreement Template Word
Fillable asset Purchase Agreement
Printable Asset Purchase Agreement Example
In conclusion, you should include the aforementioned elements in an asset purchase agreement template in order to make it effective. This agreement makes sure that a company’s sale is completed with minimal issues.