When it comes to buying or selling a small business, having a clear and concise sale agreement is crucial. A sale agreement serves as a legal contract between the buyer and seller, outlining the terms and conditions of the sale. In this article, we will provide a sample small business sale agreement to help guide you through the process.
The following is a sample small business sale agreement:
1. Agreement to sell: The seller agrees to sell and the buyer agrees to purchase the business known as XYZ Cafe (the “Business”) on the terms and conditions set forth in this agreement.
2. Purchase price: The purchase price for the Business will be $100,000. The purchase price will be paid as follows: $50,000 at closing and $50,000 payable in monthly installments over a period of 24 months with interest set at 6%.
3. Assets included in the sale: The sale includes all assets owned by the Business, including but not limited to, the following: equipment, inventory, furniture, fixtures, and goodwill.
4. Liabilities: The seller agrees to pay off all of the Business`s debts and liabilities as of the closing date.
5. Closing: The closing will take place on or before the 30th day after the date of this agreement (the “Closing Date”). The closing will take place at a location agreed to in writing by the parties.
6. Representations and warranties: The seller represents and warrants to the buyer that the Business has been operated in the ordinary course of business and that it has all necessary licenses, permits, and approvals required to operate the Business.
7. Covenants: The seller covenants and agrees with the buyer to keep the Business in the same condition as it exists on the date of this agreement, except for ordinary wear and tear.
8. Indemnification: The seller agrees to indemnify and hold the buyer harmless from any and all claims, damages, and liabilities arising from or related to the Business prior to the Closing Date.
9. Governing law: This agreement shall be governed by and construed in accordance with the laws of the state of [State], and any disputes arising out of or related to this agreement shall be resolved in the courts of [State].
10. Entire agreement: This agreement constitutes the entire agreement between the parties and supersedes all prior negotiations, understandings, and agreements between the parties.
By having a clear and concise sale agreement, both the buyer and seller can ensure that the sale of the small business goes smoothly and both parties are protected. It is always advisable to seek legal counsel to ensure that the sale agreement conforms to your specific needs and is enforceable in your jurisdiction.