CORPORATE ASSET PURCHASE AGREEMENTS

What Is An Asset Purchase Agreement?

An asset purchase agreement is a contract between a buyer and a seller to purchase and sell some or all of a company's assets.  A buyer who is interested in taking over the assets of another company can do so in two ways: i) acquire all of the shares in a company from the individual shareholders and, therefore, both its assets and liabilities; or ii) only take over certain assets of a business and leave the shares owned by the company.  An asset purchase is preferable when the buyer does not want to assume the liabilities of the company.  Thus, the company sells the assets in an asset purchase agreement but retains its liabilities and shareholders.

Our Dallas asset purchase lawyers can assist in negotiating and drafting your asset purchase agreement and helping you understand the importance of identifying the specific assets to be purchased, such as: 

• Intellectual Property

• Trademarks

• Copyrights

• Know-how

• Plant & Machinery

• Buildings & Leases

• Assigned Agreements

• Goodwill
  

• Other Intangible Assets

At Wilson Legal Group, our business lawyers utilize a team-based approach with access to multiple attorneys with substantive years of experience in many practice areas. Whatever your corporate services needs may be, our Dallas business attorneys have the talent, resources, and expertise to meet them in an efficient, timely, and cost-effective manner.

Checklist For Completing A Successful Asset Purchase Agreement 

An asset purchase agreement is a common legal document used in commercial transactions to purchases commodities, shares, businesses and real estate. It is important for both buyers and sellers to appreciate that an asset purchase agreement is a binding document with significant consequences to their livelihood. Our lawyers recommend that an asset purchase buyer and seller create checklists with the following considerations:

• Know Your Buyer Or Your Seller: Due diligence is important to avoid being defrauded. As a part of the asset purchase due diligence, you should i) review the books and records of the seller for at least the last 5 years; ii) confirm that the seller is current on its state and local taxes; iii) ascertain if any litigation has been filed involving the seller or the assets you are purchasing; and iv) make sure there are no known UCC-1 or other commercial liens against the assets to be purchased.

• Get All Necessary Parties: It is important to realize that some companies may have "assets," but those assets may be owned or controlled by a parent company or subsidiary. The due diligence of knowing who is selling you the assets to be purchased is equally as important as knowing the assets you are buying.

• Secure All Necessary Consents To Purchase: Conditions precedents are conditions and events which must be resolved before an asset can be purchased. For instance, to ensure that the assets are available to be transferred, you must confirm that i) the asset does not have a lien against it; ii) third party owner or lessor consents to the transfer; iii) any employees will transfer to support the asset, and iv) any state or local permits and licenses have been secured.

• Use An Escrow Agent for Closing: In larger transactions, it's often advisable to use an escrow agent to hold the monies until all validations and consents have been received and/or executed by the appropriate parties. An escrow agent allows the seller to feel confident that the money is available when the sale concludes and assures the buyer that no money will transfer until all asset documents are received.

• Lock Your Seller Down: A seller may sell you his assets or company, and then turn around and immediately form a competing business using new assets, thus harming the value of your asset acquisition. Our business lawyers recommend that all asset purchase agreements include, at a minimum, confidentiality agreements, non-solicitation agreements, and non-compete agreements.