Asset Purchase Agreement

Québec Anglais Droit civil Non annoté

Asset Purchase Agreement

If a letter of intention containing the main aspects of a proposed asset purchase is accepted, but the potential buyer decides not to make a detailed offer to purchase containing all the terms and conditions of the transaction (see template Y02250), the parties must sign an asset purchase agreement. Such an agreement must set out the necessary details regarding the sale of any buildings, equipment, supplies, inventory, accounts receivable, etc., in consideration of a sum of money or for securities issued by the purchaser.

This asset purchase agreement template sets out the financial, commercial and legal elements realting to such a transaction.

Asset Purchase Agreement

We recommend using this document when the process of acquiring the assets of a business was initiated by a letter of intent ("LOI") (see template Y02200). Since a letter of intent only contains a general overview of the contemplated transaction, it is important to complete the process with a more detailed agreement like this asset purchase agreement template.

Asset Purchase Agreement

0.00 INTERPRETATION
0.01 Definitions
0.01.01 Activities
0.01.02 Agreement
0.01.03 Assets
0.01.04 Breach
0.01.05 Clients
0.01.06 Closing Date
0.01.07 Confidential Information
0.01.08 Creditors
0.01.09 Effective Date
0.01.10 Encumber / Encumbrance
0.01.11 Equipment
0.01.12 Force Majeure
0.01.13 Fundamental Provisions
0.01.14 Hazardous Materials
0.01.15 Intellectual Property
0.01.16 Law
0.01.17 Legal Representatives
0.01.18 Ordinary Course of Business
0.01.19 Person
0.01.20 Prime Rate
0.01.21 Products
0.01.22 Subsidiary
0.02 Entire Agreement
0.03 Applicable Law
0.04 Non-Compliance
0.04.01 Severability
0.04.02 Substitute Provision
0.05 Miscellaneous
0.05.01 Cumulative Rights
0.05.02 No Waiver
0.05.03 Time and Days
a) Time of the Essence
b) Computation of Time
c) Delays
0.05.04 Financial References
0.05.05 Cross-References
0.05.06 Gender and Number
0.05.07 Headings
0.05.08 Approval
0.05.09 Accounting Standards
1.00 PURPOSE
1.01 Sale
1.02 Conditions
1.02.01 Required by PURCHASER
1.02.02 Required by VENDOR
1.02.03 Election
2.00 CONSIDERATION
2.01 Base Amount
2.02 Adjustments
2.02.01 Pre-paid Expenses and Special Taxes
2.02.02 Reduction of Sale Price
2.03 Breakdown of Sale Price
2.04 GST and QST
3.00 TERMS OF PAYMENT
3.01 Deposit
3.02 Initial Instalment
3.03 Balance
3.04 Third-Party Claim
3.05 Interest
3.06 Promissory Note
3.06.01 Issuance
3.06.02 Scope
3.07 Loss of Term
3.08 Advance Payment
3.09 Third-Party Owner
4.00 SECURITY
4.01 In Favour of PURCHASER
4.02 In Favour of VENDOR
4.02.01 Suretyship
4.02.02 Immovable Hypothec
4.02.03 Movable Hypothec Without Delivery
5.00 MUTUAL REPRESENTATIONS AND WARRANTIES
5.01 Status
5.02 Authority
5.03 Binding Agreement
5.04 Canadian Resident
5.05 Insurance
5.06 Nominee
5.07 Fundamental Provisions
5.08 Disclosure
6.00 REPRESENTATIONS AND WARRANTIES OF PURCHASER
6.01 Important Facts
7.00 REPRESENTATIONS AND WARRANTIES OF VENDOR
7.01 Insolvency
7.02 Assets
7.02.01 Ownership
a) Exclusivity
b) Relationships
c) Extraordinary Loss
7.02.02 Quality
a) Condition
b) Maintenance
7.02.03 Safety
7.02.04 Possession and Quiet Enjoyment
7.02.05 Encumbrance
7.02.06 Inventory
a) Ownership
b) Use
c) Financial Statements
d) Inventory Fluctuations
7.03 Human Resources
7.03.01 Labour Standards
7.03.02 Health and Safety
7.03.03 Collective Agreement
7.03.04 Miscellaneous Plans
7.03.05 Pension and Other Plans
7.03.06 Pay Equity
7.03.07 Key Persons
7.04 Corporate Finance
7.04.01 Loan Agreements
7.04.02 Default
7.04.03 Breach
7.05 Financial Management
7.05.01 Financial Statements and Balance Sheet
7.05.02 Financial Position
a) No Change
b) No Adverse Event
7.05.03 Suretyship and Guarantee
7.05.04 Accounting Methods
7.05.05 Advances
7.05.06 Arrears
7.06 Tax Status
7.06.01 Taxation
a) Payment
b) Reports
c) Compliance
7.06.02 Deductions at Source
7.07 Occupancy Titles
7.07.01 Valid Titles
7.07.02 Lease
7.08 Procurement
7.08.01 Equipment
a) Ownership
b) Condition
c) Maintenance and Warranties
d) Encumbrance
7.08.02 Material Contracts
7.08.03 Suppliers
7.08.04 Parts
7.09 Operations
7.09.01 Material Contracts
7.09.02 Clients
7.09.03 Warranties
a) List
b) Claims
7.09.04 Business Conduct
7.09.05 Discriminatory Practices
7.09.06 Conduct
7.10 Permits and Licences
7.10.01 List
7.10.02 Obtained
7.10.03 Notice
7.10.04 Transferable
7.10.05 Compliance
7.10.06 Restriction
7.11 Environment
7.11.01 Hazardous Materials
7.11.02 Use in Compliance
7.11.03 Place of Operations
7.11.04 Notice of Default
7.12 Intellectual Property
7.12.01 Miscellaneous
7.12.02 Copyright
7.12.03 Trademarks
7.12.04 Patents
7.12.05 Trade Secrets /Know-How
7.13 Computer / Internet
7.13.01 Equipment
7.13.02 Software
7.13.03 Domain Names
7.13.04 Electronic Commerce
7.14 Advertising and Promotional Means
7.15 Marketing
7.15.01 Commercial Pratices
7.15.02 Consumer Protection
7.16 Customer Credit
7.16.01 Accounts Receivable
a) Creditors
b) Books Up-to-Date
c) No Pending Claims
d) Compliance
7.16.02 Consignment
7.17 Insurance
7.17.01 List of Policies
7.17.02 Coverage
7.17.03 Full Insurable Value
7.17.04 Errors and Omissions
7.17.05 Good Standing
7.17.06 Claims
7.18 Legal Proceedings
7.19 Miscellaneous
7.19.01 Creditors
a) No Harm
b) Sufficiency
c) Use
7.19.02 Waiver and Discharge
7.19.03 Reason for Sale
7.19.04 Disclosure
8.00 MUTUAL DUTIES AND OBLIGATIONS
8.01 Confidential Information
8.01.01 Undertaking
8.01.02 End of Agreement
a) Request for Return
b) Destruction
8.02 Disclosure of Agreement
9.00 DUTIES AND OBLIGATIONS OF PURCHASER
9.01 Inventory
9.02 Insurance
9.02.01 Undertaking
9.02.02 Issuer
9.02.03 Payment of Proceeds
9.02.04 Copy
9.02.05 Certificates of Insurance
9.02.06 Prior Notice
9.02.07 Rejection or Cancellation
9.02.08 Renewal
9.02.09 Insured by VENDOR
9.02.10 Authorization
9.03 Acceptance of Delivery
9.04 Contributions
9.05 Lease
9.06 Staff
9.07 Release from Undertakings
9.07.01 Deadline
9.07.02 Indemnification
10.00 DUTIES AND OBLIGATIONS OF VENDOR
10.01 Transition
10.02 Indemnification
10.02.01 “Loss”
10.02.02 Scope
10.02.03 Procedure
10.02.04 Deductible
10.02.05 Prescriptive Periods
a) Tax Claim
b) Other Claim
c) Claim Based on Undertaking
d) Bad Faith Claim
10.02.06 Limitation
10.03 Delivery
10.04 Non-Competition
10.04.01 Scope
10.04.02 Violation of Undertaking
a) Penalty
b) Payment
10.04.03 Additional Remedies
a) Injunction
b) Protective Measures
10.05 Reasonableness of Clause
10.06 Non-Solicitation
10.06.01 Clients
a) Scope of Undertaking
b) Violation of Undertaking
i) Automatic Penalty
ii) Payment
iii) Protective Measures
10.06.02 Personnel
a) Scope of Undertaking
b) Violation of Undertaking
i) Automatic Penalty
ii) Payment
iii) Protective Measures
10.07 Inventory
10.08 Dismissals
10.09 Leases and Leasing Agreements
10.10 Corporate Name
11.00 SPECIAL PROVISIONS
11.01 Assignment
11.01.01 Prohibition
11.01.02 Reasonable Cause
11.01.03 Effect of Breach
11.01.04 Exception
11.02 Force Majeure
11.02.01 Limitation on Liability
11.02.02 Duty
11.02.03 Right of Other PARTY
11.03 Drafting Costs
11.04 Further Assurances
11.05 Remedies
11.05.01 Choice
11.05.02 No Limitations
11.06 Prescriptive Period
12.00 GENERAL PROVISIONS
12.01 Notice
12.02 Dispute Resolution
12.02.01 Good Faith Negotiations
a) Written Notice
b) Meeting
c) Legal Proceedings
d) Protective Measures
12.02.02 Mediation
a) Process
b) Mediator
c) Settlement
d) Legal Proceedings [OR Arbitration]
12.02.03 Arbitration
a) Notice
b) Reply
c) Appointment of a Third Arbitrator
d) Confidentiality
e) Hearing
f) Ruling
g) Costs
h) Supplementary Rules
12.03 Election
12.04 Counterparts
12.05 Amendment
12.06 No Waiver of Rights
12.07 Electronic Transmission
12.08 Language
13.00 TERMINATION
13.01 Mutual Consent
13.02 With Notice from VENDOR
13.03 With Notice from PURCHASER
14.00 EFFECTIVE DATE
14.01 Upon Execution
14.02 Exceptions
14.02.01 Retroactive
14.02.02 Deferred
15.00 DURATION
15.01 Transfer of Ownership
15.02 Survival
16.00 SCOPE


SCHEDULE A – EXCERPT FROM A RESOLUTION OF THE VENDOR
SCHEDULE B – EXCERPT FROM A RESOLUTION OF THE PURCHASER
SCHEDULE 0.01.03 (a) – IMMOVABLE
SCHEDULE 0.01.03 (c) – EQUIPMENT, MACHINERY AND TOOLS
SCHEDULE 0.01.03 (d) – ROLLING STOCK
SCHEDULE 0.01.03 (e) – MOVABLE PROPERTY AND OFFICE EQUIPMENT
SCHEDULE 0.01.03 (f) – IT MATERIAL AND EQUIPMENT
SCHEDULE 0.01.03 (j) – PERMITS AND LICENCES
SCHEDULE 0.01.03 (k) – INTELLECTUAL PROPERTY
SCHEDULE 0.01.03 (l) – LEASE
SCHEDULE 2.01 – BASE AMOUNT
SCHEDULE 2.02.01 – ADJUSTMENTS
SCHEDULE 3.06 – PROMISSORY NOTE
SCHEDULE 4.02.01 – SURETYSHIP
SCHEDULE 4.02.02 – IMMOVABLE HYPOTHEC
SCHEDULE 4.02.03 – MOVABLE HYPOTHEC WITHOUT DELIVERY
SCHEDULE 7.02.04 – LEASE AND LEASING AGREEMENTS
SCHEDULE 7.03.03 – COLLECTIVE AGREEMENTS
SCHEDULE 7.03.05 – PENSION AND OTHER PLANS
SCHEDULE 7.04.01 – LOAN AGREEMENTS
SCHEDULE 7.05.01 – FINANCIAL STATEMENTS ON ............................, 20...
SCHEDULE 7.08.02 – MATERIAL AGREEMENTS (PROCUREMENT)
SCHDEULE 7.09.01 – MATERIAL AGREEMENTS (OPERATIONS)
SCHEDULE 7.09.03 – WARRANTIES
SCHEDULE 7.17.01 – INSURANCE POLICIES
SCHEDULE 10.06.01 – CLIENTS (NON-SOLICITATION)
SCHEDULE “…” – INTERVENTION OF LESSOR
SCHEDULE “…” – INTERVENTION OF A SHAREHOLDER, DIRECTOR OR OTHER OFFICER
SCHEDULE “…” – INTERVENTION OF VENDOR’S SPOUSE





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