Instead of acquiring all the shares of a company, and therefore both its assets and liabilities, a buyer very often prefers to take over only certain assets of a company. As a general rule, the company will sell the assets itself in the event of an asset acquisition, while in the case of a share sale, the individual shareholders will be the sellers. An asset transfer contract, also known as an asset acquisition contract, a capital transfer contract, is a contract that concludes the terms of the purchase and sale of assets of a company. In the case of an asset sale, the company`s assets are transferred to a new owner without the actual ownership of the business being transferred. Instead of acquiring all the shares of a company, and therefore both its assets and liabilities, a buyer very often prefers to take over only certain assets of a company. As a general rule, in the event of an asset acquisition, the company will sell the assets itself, while in the event of a share sale, the individual shareholders will be the sellers. The agreement may also mention that all disputes arising from the agreement fall within the exclusive jurisdiction of a particular jurisdiction. In addition to the flexibility to sell only certain assets and not the entire business, asset acquisition agreements generally contain detailed provisions regarding the transfer of liabilities from the seller. The main drawback of an asset acquisition, as opposed to a share purchase agreement, is that each item must be transferred in accordance with its correct rules and made against third parties (for example. B by consent and authorization).
This is especially true for customer contracts, as a third party may view the transaction as an opportunity to renegotiate their contract. This could delay the agreement and increase transaction costs. A buyer will normally prefer to buy a company`s assets, while the seller prefers to sell the shares. The reason is that an investment purchase allows a buyer to choose exactly what assets they are buying and to identify precisely which liabilities they want to assume. These agreements are non-refundable and non-transferable. If you need changes or questions, please contact us before you download. By clicking on the button below, I agree with the terms and conditions of sale. The transfer of businesses (employment protection) (TUPE) protects the rights of workers in the event of a transfer of assets from a company. The basic principle of TUPE is that when a seller buys the company`s assets as a “current business,” the employees of that company are automatically transferred to the buyer. On this basis, the buyer and seller must contact the relevant staff at an early stage.
For advice when passing on staff and TUPE as part of an asset purchase, you can ask a lawyer at any time. An asset repurchase agreement (APA) is an agreement between a buyer and a seller that concludes the terms and conditions for the purchase and sale of a company`s assets.   It is important to note in an APA transaction that it is not necessary for the buyer to purchase all of the company`s assets. Indeed, it is customary for a buyer to exclude certain assets in an APA. The provisions of an APA may include payment of the purchase price, monthly payments, pawn and asset charges, closing condition, etc.  An APA is different from a share purchase agreement (SPA) in which business shares are also sold, ownership of assets and ownership of liabilities.  In an APA, the buyer must choose certain assets and avoid redundant assets.