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Asset purchase agreement template uk

Asset sale contract 2025

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The document is an Asset Sale Agreement dated August 26, 2010, between Nortel Networks Corporation and PSP Holding LLC, detailing the sale of assets from Nortel to the Purchaser. It outlines the purchase and sale terms, including asset definitions, purchase price adjustments, representations and warranties of both parties, conditions for closing, and obligations regarding employee matters. The agreement also addresses regulatory approvals required under U.S. and Canadian bankruptcy laws, confidentiality provisions, and procedures for handling taxes related to the transaction. The document emphasizes that all transactions are subject to court approval due to ongoing bankruptcy proceedings.

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Click 'Get Form' to open the asset sale contract in the editor.
Begin by filling in the parties involved. Enter the names of the Sellers and Purchaser as specified in the document.
Proceed to Article I, where you will define key terms. Ensure all definitions are clear and accurate for legal compliance.
In Article II, detail the Purchase and Sale of Assets. Specify which assets are included and any exclusions that apply.
Complete Section 2.2 regarding the Purchase Price. Input the agreed amount and any adjustments based on working capital or other factors.
Review Articles III through V for representations, warranties, and covenants. Fill out any necessary disclosures or agreements required by these sections.
Finalize by checking all fields for accuracy, ensuring compliance with applicable laws, and saving your changes before submitting.

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We have answers to the most popular questions from our customers. If you can't find an answer to your question, please contact us.

Is an asset sale better for buyer or seller?

Asset sales typically leave liabilities, like unpaid tax obligations, with the seller. Buyers often prefer an asset sale because they can pick and choose which parts of the business to acquire, avoiding unwanted liabilities and getting a step-up in the tax basis of assets.

Why might a seller prefer a stock sale to an asset sale?

Most deals are structured as stock sales because unlike our simplified assumption, sellers frequently face tax on the gain on sale, leading to a second level of tax in an asset sale above the shareholder-level capital gains tax.

How does an asset sale work?

An asset sale is where a firm sells some or all of its tangible or intangible assets to another party, while retaining ownership of the business entity and transferring no liabilities to the buyer.

What are the advantages of asset sale?

Advantages of an asset sale Reduced liability: The buyer can choose which liabilities to assume, limiting potential risks. Step-up in basis: The buyer can revalue the assets at the purchase price, potentially reducing future tax liabilities.

What are the reasons for selling an asset?

Consider these six reasons to sell an investment more than one may apply Its time to rebalance. Something has changed. The economy has shifted. You want to avoid excessive concentration. Youre retiring or have a need for cash. You need a tax loss to offset capital gains.

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What are the disadvantages of asset sale?

Disadvantages of an asset sale Consents and assignments: Some contracts or agreements may require specific consents or approvals for the transfer of assets. Potential opposition: Employees may not be in favour of an asset sale as it can lead to uncertainty and possible job terminations.

Why would a seller prefer an asset sale?

Tax is the main reason sellers want a share sale. The sellers could walk away with cash from the sale after paying only around 10% tax. An asset sale would likely mean Corporation Tax due on the proceeds (gain) plus further Tax to extract the money from the company.

What happens to a company after an asset sale?

After the transaction, the target company can choose whether or not to remain in existence. Often, the target company will dissolve as a result of the sale (or sometime soon thereafter). Asset deals can be mechanically and logistically easier to execute, but it depends on the buyers flexibility and discretion.