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Asset Purchase Agreement

Drafts a U.S. Asset Purchase Agreement for deals where a buyer acquires specified business assets while avoiding unwanted liabilities. Enforces itemized asset/liability schedules, purchase price mechanics with working capital true-ups, IRS Form 8594 tax allocation, seller and buyer reps and warranties with disclosure schedules, pre- and post-closing covenants, closing conditions and deliveries, and indemnification with basket/cap limits. Use when drafting an asset purchase agreement, APA, asset acquisition, purchase and sale of assets, asset deal, or excluded liabilities agreement.

ID: us.corporate.asset-purchase-agreement Version: 0.1.0 License: Apache-2.0 Author: CaseMark Language: en Added: 2026-05-27
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Asset Purchase Agreement

Draft a transaction-ready APA that precisely allocates assets, liabilities, and post-closing risk between buyer and seller.

Prerequisites

  1. Parties and structure — legal names, entity types, jurisdictions, signing authority, deal structure
  2. Asset and liability inventory — preliminary lists for Purchased Assets, Excluded Assets, Assumed Liabilities, Excluded Liabilities
  3. Economic terms — purchase price, payment form, adjustments, earnouts, escrow/holdback, allocation
  4. Key deal risks — regulatory approvals, consents, IP chain of title, material contracts, employee transition, environmental exposure
  5. Timeline — signing/closing schedule, deliverables, conditions

If any prerequisite is missing, pause and ask — do not assume or fill gaps.

Output Structure

Step 1: Document Skeleton

Draft in this order:

  1. Parties; Effective Date; Recitals
  2. Definitions
  3. Purchase and Sale of Assets
  4. Excluded Assets
  5. Assumed Liabilities
  6. Excluded Liabilities
  7. Purchase Price; Payment; Adjustments; Allocation
  8. Closing; Closing Deliveries
  9. Representations and Warranties of Seller
  10. Representations and Warranties of Buyer
  11. Covenants (Pre-Closing; Post-Closing)
  12. Non-Competition / Non-Solicitation (if applicable)
  13. Conditions to Closing
  14. Indemnification
  15. Miscellaneous; Signatures; Exhibits and Schedules

Step 2: Exhibits and Schedules

Label Purpose Must Include
Exhibit A Purchased Assets Detailed categories and itemized lists
Exhibit B Excluded Assets Cash, A/R (if excluded), retained contracts, corporate records
Exhibit C Assumed Liabilities Specific obligations, amounts, contract IDs
Exhibit D Purchase Price Allocation IRS Form 8594 class allocation
Disclosure Schedules R&W exceptions Numbered to match each R&W subsection

Step 3: Asset Scope and Exclusions

  • Define "Purchased Assets" by category; cross-reference Exhibit A
  • "As is, where is" only if consistent with negotiated reps/warranties
  • Include books/records, data, IP, goodwill, domain names, social accounts if intended
  • Catch-all exclusion: anything not in Exhibit A is excluded
  • List retained corporate records, tax returns, insurance policies, non-assigned contracts

Step 4: Liability Allocation

  • "Assumed Liabilities" strictly limited to Exhibit C items
  • "Excluded Liabilities" covers pre-closing operations, taxes, employee obligations, litigation, environmental

Step 5: Price, Adjustments, and Tax Allocation

  • Payment timing, wire instructions, escrow/holdback terms
  • Working capital or inventory true-up: baseline, measurement method, dispute process, timing
  • IRS Form 8594 allocation; covenant for consistent reporting by both parties

Step 6: Reps and Warranties

Seller R&W: Organization/authority; title to assets; financials; compliance; material contracts; litigation; taxes; IP; employees/benefits; environmental. Apply materiality and knowledge qualifiers where negotiated.

Buyer R&W: Organization/authority; enforceability; funds/financing; no conflicting approvals; governmental consents.

Number each R&W subsection to match its corresponding disclosure schedule.

Step 7: Covenants

  • Pre-closing: ordinary-course operation; no asset transfers; no new debt; no material contract changes
  • Post-closing: preserve goodwill; restrict Seller use of transferred name/marks
  • Non-compete / non-solicit (if applicable): define restricted business, geography, duration, consideration; include reformation/severability clause

Step 8: Closing Conditions and Deliveries

Party Conditions Deliveries
Seller Accuracy of reps, covenant performance, no MAE, consents received Bill of sale, assignments, lien releases, officer's certificate, good standing
Buyer Accuracy of reps, covenant performance Payment, assumption agreement, officer's certificate

Step 9: Indemnification

  • Seller indemnifies for breaches, excluded liabilities, pre-closing operations
  • Buyer indemnifies for breaches and assumed liabilities
  • Include notice procedures, defense control, cooperation obligations
  • Limits: basket (deductible vs. tipping), cap, survival periods, fraud carve-out, insurance offset

Step 10: Assignment and Assumption

  • Reference separate assignment agreements for contracts and IP
  • Identify third-party consent requirements; state non-assignment where prohibited by law or contract
  • Carve out non-assignable items at closing

Guidelines

  • Keep asset and liability schedules itemized and cross-referenced; never use "all assets" without categories
  • Confirm third-party consent requirements before drafting assignment language
  • Match disclosure schedule numbering to each R&W subsection exactly
  • Use defined terms consistently; avoid duplicate definitions across exhibits
  • Non-compete enforceability varies by state — tailor duration and geography to local law [VERIFY]
  • Tax allocation must align with economics and both parties' reporting obligations
  • If regulated assets or licenses are involved, add specific regulatory approval conditions
  • If data or IP is included, confirm chain of title and include transfer instruments
  • Output is draft work product requiring attorney review — not legal advice

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