Reading 4. Business Acquisition Agreement

Read the text of the agreement and write a suitable heading above each paragraph. Choose from the headings below:

 

a. Purchase Price      b. Severability

c. Competition       d. Jurisdiction

e. Purchase Description-Assets and Liabilities

f. Indemnity

 

This agreement (" Agreement) is made this {date} of {month}, {year}, by and between {name of seller}, hereinafter known as " Seller, " and {name of buyer}, hereinafter known as " Buyer, " for the purchase of {business name}, hereinafter known as the " Business, " and all related assets.

Buyer and Seller both agree to the following provisions as conditions for the sale of the Business:

1. ………………………………………………………………

Buyer is purchasing the following assets from Seller:

{ Here is where the assets should be listed. If this is simply a sale of assets, and Seller is retaining name rights only to the business/corporation, please note that here. Otherwise, make a list, including value, of each asset which will be sold to the Buyer from the Seller. If necessary, reference " schedules, " or attachments, and include them with this document, with the understanding that both parties are signing off on the schedules as well as the provisions listed here. The list of assets may be done in any way, but a convenient method might be to include a simple table with the details. See sample table below.}

ASSETS	VALUE
Customer accounts	$200, 000
Inventory/Goods	$150, 000
Rental Properties	$75, 000
Equipment	$95, 000
Intellectual Property	$50, 000
Building(s)	$350, 000

{also be sure to include, if applicable, that Buyer will receive title(s) to any properties the Seller will be purchasing, as well as how the transfer of customer accounts, if any, will proceed} {after listing the assets, you must also include a list of liabilities, if any, that the Buyer will be assuming from the Seller. Again, using a table is an efficient way to accomplish this task.}

DEBT	AMOUNT
Mortgage/Lease	$100, 000
Advertising Contract	$10, 000
Equipment Rental Contract	$30, 000

2. ………………………………………………………………..

Owing to the total value of the assets and liabilities listed in Section 1, as well as {any other considerations that fall within the purchase price}, the total purchase price of the Business is {amount in dollars}, which will be paid in the following manner:

{here you outline the details of the payment plan, including whether it will be paid in cash, in installments, whether interest and/or late fees will be added, etc.}

3. ………………………………………………………………..

Seller agrees that for a period of {length of time}, {he/she} will not engage in any activities related, directly or indirectly, to the Business, and will not attempt to solicit business or services from any customers, clients, etc. who originally were such during the Seller's ownership of the Business. This non-compete clause applies to {name the geographic region, such as the state, tri-state area, nation, etc.}.

4. …………………………………………………………….

If either party is found to be in breach of this Agreement, the offending party will indemnify the offended party for any legal fees accrued as a result of the breach. Lost profits incurred as a result of any such breach {will/will not} be repaid by the offending party.

5. ……………………………………………………………..

Should any provision in this Agreement be deemed in some way invalid, the remaining provisions shall remain intact and enforceable by law.

6. ………………………………………………………………...

This Agreement shall be governed by the laws and regulations of the state of {State Name}.

 

Both parties agree to the provisions listed above, as well as any applicable schedules or attachments included with this Agreement.

Signed this {date} of {month}, {year}.

 

___________________________ __________________________
Seller Name Seller Signature

 

___________________________ __________________________
Buyer Name Buyer Signature

 

___________________________ __________________________
Witness/Legal Representative Name Witness/Legal Representative Signature

 

Taken from: printablecontracts.com

 

Revision

· What is a contract? Give an example of an agreement that is not a contract and an agreement that is a contract. Explain the difference.

· What essential elements does a contact consist of? What forms can consideration have? Give examples.

· What factors can make a contract unenforceable?

· Explain different types of contract terms. Give an example of an implied contract, of an oral contract.

· What alternatives does the non-breaching party have if the other party failed to perform the terms? What is the difference between warranties and conditions?

· Do third parties have rights and duties under a contract? Are there any exceptions? Why is it important to differentiate between the assignment of rights and delegation of duties?

· Does a written and signed contract give you full legal protection?

· What can help you avoid legal disputes and litigation?

· Why is it crucial to check the reliability of the party you are contracting with and how can you do it?

· Why is it necessary that the other party understands your needs and the purpose of the contract?

· What are the advantages and disadvantages of standard form contracts?

· Why should you always check the authority of the people you are negotiating with?

Recommended literature

1. Krois-Linder A., International Legal English. – Cambridge University Press, 2006.

2. Krois-Linder A., Firth M., Introduction to International Legal English. – Cambridge University Press, 2009.

3. Brown G., Rice S., Professional English in Use. Law. – Cambridge University Press, 2007

4. Brieger N., Professional English. Law. – Longman 2002.

5. Smith T., Market leader. Business law. Business English. – Longman Pearson Education Lid., 2009.

6. Riley A., English for law. – Longman, 2005.

7. Powell R., Law Today. – Longman, 1993.

Unit 5. Tort Law

Reading 1. Glossary

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