Fillable Printable Asset Purchase and Sale Agreement Form
Fillable Printable Asset Purchase and Sale Agreement Form

Asset Purchase and Sale Agreement Form

ASSET%PURCHASE%&%SALE%AGREEMENT%
A.%PARTIES%
This%agreement%(“agreement”)%is%entered%into%this%___
%
day%of%July,%201_%by%and%between%XXX%LLC,%a%
California%limited%liability%company%(“The%LLC”%or%“buyer”)%and%YYY%Inc.%(“ X X X ”%o r %“s e ller ”),%a %C a lifo rn ia %
compa ny.%Buyer%and%seller%will%be%referred%to%at%times%as%“the%parties.”%
%
B.%RECITALS%AND%SUMMARY%
XXX%owns%the%business%assets%and%operates%two%_____________%businesses%located%at…………… …… …..%
The% LLC% is% purchasing,%o n% a%contingent%basis,%the%assets% o f% the% b usinesses%“free%and%clear,”%including,%but%
not%limited%to,%license%rights,%equipment,%furniture,%supplies,%personal%property%leases%(to%the%degree%
desired%by%buyer%and%transferable)%conditional%use%permits,%business%licenses%(to%the%degree%
transfera ble ),%clientele%contacts%and%contracts%(to%the%degree%desired%by%buyer),%cou rs e %and%instructional%
materials%(if%applicable),%staf f%and%independent%contractor%relationsh ips%(to%the%degree%desired),%
applicable%intellectual%property%(if%any),%accounts%receivable,%telephone%num bers%and%good%will.%
Collectively,%all%items%purchased%shall%be%referred%to%herein%as%the%“assets.”%This%agreement%will%also%be%
referred %to%h ere in% at%times%as% “this%transaction.”%A%copy%of%the%licensing% agreement%is%attached%hereto%as%
Exhibit%“A”%and%in corporated%herein%by%this%reference.%%
Buyer%may% specifically%decline%in%writing%to%purchase%a% portion%of%the%assets%described%above%prior%to%the%
conclusion%of%the%Due%Diligence%period%(see%section%D.%below).%This%includes,%but%is%not%limited%to,%
existing%employee,%client%and%independent%contractor%relationships,%as%well%as%the%licenses.%
Buyer%is%not%offering%to%purchase%any%debt%or%legal%obligation%of%seller,%exc e p t%as %m a y %be %ex p r e ss ly %
agreed%upon%prior%to%closing.%
%%%
C.%PURCHASE%& %SALE;%PRICE%A ND%TERMS;%CLOSING%
Purchase%& %Sale:%
%
Subject%to%the%contingencies%listed%in%section%D.,%and%other%terms%of%this%agreement,%seller%hereby%sells%
and%the%LLC%hereby%purchases%title%of%seller%to%the%assets.%Seller% represents%and%warrants%that%except%for%
the%items%atta che d%hereto%as%Exh ibit%“ B,”%or%as%deposited %in %e scro w %as%soon %a s%possible%a fter%the%esc row %
is%op en e d ,%th e re %ar e%n o %e n cu mbranc es %o f%a n y%n a tu re %o r%k in d%on%the%asse ts%an d%a ll%rights%of%a ny%n atu re%
thereto ,%and %furth er,%tha t%seller%is%conv eyin g%full%right%an d%title%to%th e%asse ts%an d%all%rights%o f%any %natu re%
thereto %to%th e%LLC%(devo id%of%a ny %legal%p rob lem s%and %with%no%claims%and%liens%b y%other%parties,%private%
and%governmental).%%
The% LLC,% in% acquiring%full% right%and%title% to% the% assets% and%all%rights%of%any% nature% thereto,%is% free% to% utilize%
all%such%rights%and%title%to%the%fullest%extent%permitted%by%law.%
Price%and%Terms:%%
Subject% to%D.%2.%and%D.%6.,% b elow,%the% purchase% price%of% the%assets%is% ________________________dollars%
($___ _ __ __ _ __ __ .00 ).%All%figures%are%in%United%States%funds.%%
_________________%dollars% ($_____________.00)% is%due%prior%to%closing,%by%certified,% cashier’s% check%or%
wire%transfer%or%as%otherwis e%dire ct ed %by%the %buy er’s %lend e r%and /o r%esc ro w %ho ld er%(if%d e p o site d %in%
escrow);%to%be%paid%at%closing.%
________________%dollars%($____________.00)%is%payable%as%follows:%
During%at%least%the%first%eighteen%months%immediately%following%closing,%buyer%will%make%no%interest%
monthly%payments%of%$_________.00.%This%p eriod%of%time% may% be% expanded% to% as%long% as%the% date% of%the%
expiration%of%the%___________ _%lease,%depending%on%circumstances%as%described%in%D.%2.%below.%These%
payments%are%due%no%later%than%the%10
th
%of%each%month%in%which%they%are%due.%These%payments%will%not%
be%accelerated%unless%buyer%becomes%at%least%2%monthly%payments%delinquent.%There%w ill%be%no %preZ
payment%penalty.%There%is%a%5%%penalty%added%to%any%late%payment.%
%Immediat e ly %the re a ft e r,%the %remaining%balance%($___________%m inus%all%payments%made%per%the%
previous%paragraph)%is%payable%in%coZequal%m onthly%payments%of%$_ _______% until%the%remaining%balance,%
plus%interest,%is%paid%in%full%(the%“note”).%The%note%is%p ayable%with%six%percent%(6%)%simple%inter es t,%
compo unded %annually.%Upon%the%timely%receipt%of%all%such%monthly%payments,%the%note%(and%the%
purchase%price%of%the%transaction)%will%be%paid%in%full.%These%payments%are%due%n o%later%than%the%10
th
%of%
each%month%in%which%they%are%du e.%The%note%will%not%b e %a c ce le rat ed %unles s%buyer %b e co mes%at %le a st %2 %
monthly%payments%delinquent.%There%will%be%no%preZpayment%penalty.%There%is%a%5%%penalty%added%to%
any%late%payment.%%%%
A%promissory%note%template%in%accordance%with%this%agreement,%is%attached%hereto%and%incorporated%
herein%by%this%reference.%
The%purchase%price%of%the%assets%increases%by%______________%dollars%($___________.00)%upon%the%
occurrence%of%certain%events%as%described%in%D.%2.%below.%In%the %eve n t %the %pu r ch a s e%p ric e%in cr ea s es ,%the %
additional%sum%will%be%added%to%the%note%principal%due%at%that%time,%payable%at%the%same%interest%rate%
and%monthly%payment%until%the%entire%principal%am ount%is%paid.%
!
Buyer%will%deposit%the%sum%of%_______________%dollars%($________.00)%as%“earnest%m oney”%upon%
buyer’s%entry%into%a%legally%binding%agreement%w ith%the%lessor%of%the%businesses%premises%(“lessor”)%to%
lease %th e %tw o %p re mises%on %te rms%agree ab le %to %b u ye r%(s h ou ld %th is %tra n sa c tio n %clo se ). %The%earnest%money%
is% re fu n d ab le ,%minu s %escrow%ex p en s es ,%if%th is %transa ct io n%does%not%close%and%refundable%in%full%to%buyer%if%
this%transa ction %closes .%
The%earnest%money%shall%b e%deposited%at%ZZZ!(“escrow %hold er” ),%___ __ __ _ __ __ __ _ __ __ _ __ __ _ __ __ %
(addre ss).%Executed%escrow%instructions%(prepared%by%buyer%an d%reasonably%acceptable%to%the%parties%
and%the%escrow%h older)%shall%be%deposited%in%escrow%within%seven%(7)%days%after%the%signing%of%this%
Agreement.%Buyer%will%supply%contact%information%to%seller%for%ZZZ%upon%the%signing%of%this%Agreement.%
Closing:%%
This%transaction%is%subject%to%the%California%Uniform%Com mercial%Code%–%Bulk%Sales%statutes%(“Bulk%Sales%
Act”).%The%aforementioned%escrow%instructio ns%will%include%creditor%notice,%publication,%payment%and%
other%salient%provisions%in%accordance%with%the%Bulk%Sales%Act.%Seller%w ill%deposit%th e%req uired %
infor m a tio n %fo r%b u y er ’s%u se %u n d er%s e ct ion %6 1 0 4 %o f%th e %B u lk%S a les %A ct .%The%provisions%and%requirements%of%
the% B ulk% S ales % Ac t% are % all% m a terial% te rm s% o f% this%agreem en t% an d % are % inco rp ora ted%by%re fere nce % h ere in% an d %
inclu d ed %h e re w ith %a s %Ex h ib it%“ C ”%for%ease%of%reference.%
Tax%clearance%certificates,%e.g.%Franchise%Tax%Board%and%B oard%of%Equalization ,%to%the%extent%required,%
will%also% be%filed%in% escrow%prior% to% closing.%Sales%tax,%if%any,%and%an y%other%tax%due%from%the%purchase%of%
the%asse ts%will%be%paid%out%of%the%escrowed%purchase%price.%All%new%mem bership%fees%and%monthly%fees%
receive d%d urin g%the %Du e%D iligen ce %pe riod %no t%use d%in%th e%o rdin ary%c ou rse%o f%the %bu sine ss%sh all%be %
retaine d%in%th e%seller’s%ch ec king%a cco un ts%an d%tran sfe rred %directly %to%bu yer%upo n %closin g.%%%%%
This%transaction%shall%close%the%next%business%day%after%written%notice%of%the%release%of%all%contingencies%
listed %in%D.%belo w %is%receive d %by%Selle r%(“C los in g ”%or%“Clo s ing %Da te ” ). %The% “D ue% Diligence% period”%shall% not%
exceed%sixty%(60)%days%from%the%date%first%written%above%unless%m ore%time%is%need ed%to%com plete%all%
aspects%of%the%bulk%sales%portion%of%this%agreem ent,%any%other%governmental%clearance%or%approval%
and/or%anything%related%to%the%franchise%(and%as%contained%in%the%escrow%instruction s).%%%
%
D.%CONTINGENCIES;%DUE%DILIGENCE%
Contingencies:%
1.%This%Agreement%is%contingent%upon%buyer%securing%necessary%funding%to%purchase%th e%assets%prior%to%
closing.%Buyer’s%lender%w ill%likely%determine%the%method%of%paym ent,%into%escrow,% directly% to%seller%or%as%
otherwise%reasonably%arranged%by%the%parties.%
2.%Subject%to,%and%as%further%described%in%section%C.,%Price%and%Term s%(above),%this%Agreem ent%is%
contingent%upon%buyer%working%out%a%rental/lease/subZlease%arrangement%w ith%lessor%and/or%seller%(as%
defined%in%C.%above%and%within%section%K.%below)%for%the%_________________%premises%of%the%
businesses.%Any%such%agreement(s)% will% be% binding%upon% buyer% only%if% this% transaction%closes%and% shall%be%
deposited%with%the%escrow%holder%prior%to%closing.%The%terms%of%any%such%agreem ent(s)%are%as%reasonably%
acceptable%to%buyer.%%
In%the %cas e %of%th e %__ _ __ _ _ _ _ _ _ _ __ %p re mises%( cu r re n t%lea se %ex p ire s%in %ab o u t%3%ye a rs ),%bu y er %m u st %en te r%
into %a%leas e%o r %su bZlease %fo r%the%premises%p rio r%to %t h e%exp ira tio n %o f%th e %le a se %fo r%th e%a dd itiona l%
$_____________.00%to%the%purchase%price%to%apply.%The%lease%or%sublease%terms%shall%be%reasonable,%at%
least %10 %yea rs %an d%n o%m o r e%th an %$1 .7 5 %pe r%foo t .%If%the %__ _ _ _ _ __ _ _ _ _ %lea se %ex p ire s,%bu y e r%m a y%tra n s fe r%
any%an d%all%assets%therein%located%to%the%___________%location.%If%bu ye r %ent er s%int o %a%lease %or%su b Z le a se %
agreement%for%the%_________________%premises%prior%to%the%expiration%of%the%current%lease,%the%note%
shall%be%adjusted%to%take%into%account%these%chang es.%
3.%This%Agreement%is%contingent%upon%the%transfer%of,%or%assurance%of%transfer%of,%license%agreement(s),%
any%conditional%use%permits%(“CUPs”)%and%all%other%governm ental%licenses%and%permits%for%the%
businesses.%All%such%transfer%or%assurances%(or%w aiver%of%same%by%buyer)%shall%be%deposited%with%the%
escrow%holder%prior%to%closing.%It%is %unders to o d %tha t%t h e %C U P s %a re %“site%spe cific ” %a n d %d o%not%app ly%or%
transfer%to %any %othe r%loca tions %(redu cing %their%valu e%to%b uy er%significa ntly).%%
4.%This%Agreement%is%contingent%upon%the%placement%in%escrow%of %a%notice%from%buyer%releasing%all%
contingencies%and%a%final%list%of%assets%included%in%this%transaction%prior%to%closing.%
5.%This%Agreement%is%contingent%upon%the%placement%in%escrow%of%a%notice%from%buyer%stating%that%the%
Due%Diligence%effort%has%resulted,%within%the%necessary%time%frame,%in%buyer’s%satisfaction%with%all%
disclosed%information%and%m aterial,%and%with%any%necessary%adjustments%to%this%agreement%resulting%
therefro m .%
6.%This%Agreement%is%contingent%upon%proof%from%seller%that%the%purchase%price%is%fair%and%supported%by%
the%va lue%o f%th e%a ssets.%Such%p roof%is%to%be%provided%to%buyer%during%the%Due%Diligence%period.%The%
parties%agree%to%bargain%in%good%faith%to%reduce%the%purchase%price%of%the%assets%if%the%purchase%price%
above%is%not%supported%by%proof%supplied%by%seller%during%the%Due%Diligence%period%and/or%if%buyer%
decides%not%to%include%enough%of%the%assets,%thereby%w arranting%a%price%reduction.%
7.%This%Agreement%is%contingent%upon%the%paym ent%of%all%required%fees,%transfer%fees%taxes,%costs%of%
escrow%and%any%other%payment%or%amount%due%to%any%third%party%out%of%the%purchase%price. %
Due%Diligence:%
a.%Seller%shall%supply,%without%limitation%(except%as%to%reasonableness)%copies%of,%or%access%to%(as%the%case%
may%be),%all%documents,%materials%and%info rm a tion %nec ess ary%fo r%buy er%to%co n firm %the%d eta ils%of%this%
transac tion .%This%requirement%applies%to%the%seller%and%all%its%relevant%agents%and%associates%possessing%
any%such%information.%
b.% Buyer% w ill%utilize% the% Due%Diligence%period% to% investigate% all% factors%it% considers%relevant,% in%relation% to%
the%asse ts%an d%the %con du ct%o f%the%b usine sse s.%%%%%
%
E.%RESPONSIBILITIES%OF%THE%PARTIES%
The%parties%agree%to%complete%all%required%steps%toward%a%possible%conclu sion%of%this%proposed%
transac tion %in%a%goo d%faith ,%time ly %m a n n e r.%
The%parties%agree%to%hold,%protect%and%preserve%all%materials%and%information%received%in%the%course%of%
the% Du e% Dilig e n ce % p e rio d .%All%such%material%and%information%is%strictly%confidential%and%for%the%private%use%
of%the%parties%only,%to%be%viewed%and%utilized%only%by%the%pa rties%an d%th eir%resp ective %pro fessio na l%
advisors.%%
If%this%transaction%does%not%close,%the%parties%agree%to%expeditiously%return%all%materials%and%information%
receive d%by %them%from%the%o the r%party .%%
%
F.%MUTUAL%RELEASE%
The%parties%ackno w led ge %an%in de pe nd en t%contrac tor%relation ship %betw een %seller%and%the%buyer’s%
manager,%_________________(“Mr.%____________”),%existing%prior%to%the%close%of%this%transaction.%
Upon% the% closing% of% this% transaction,% the%parties%agree% to%release%the%other%from% any%claim% of%damage%or%
damage%arising%out%of%the%tim e%in%which%Mr.%____________%was%an%independent%contractor%of%seller.%%
1.%Gen e ra l,%Mutua l%R e le a s e ;%NonJAdmission%of%Liability%
This%M utual%General%Release%shall%not%in%any%w ay%be%construed%as%an%admission%that%either%party%has%
acted%wrongfully%with%respect%to%the%other%party%or%any%other%person,%and%both%parties%specifically%
disclaim%any%liability%to%or%wrongful%acts%against%the%other%party%or%any%other%person,%on%the%part%of%
himself,%itself%and%their%respective%em ployees%or%agents,%if%any.%In %fa ct,%t h e%p a rt ie s%a re %n o t%a ware%of%
having%done%anything%to%harm%the%interests%of%the%other%party.%
2.%Complete%Release%by%Both%Parties.%
(a)%E xce pt%as%he rein%otherw ise%agreed,%each%p arty%hereby%irrevocably%and%unconditionally%
release s,%acqu its%and %fore ver%d ischa rge s%the%o ther%a nd %each %of%the ir%prese nt%an d %form er%a gen ts,%
directors,%officers,%employees,%representatives,%attorneys,%spouses,%other%family%members%and%anyone%
associated%with%the%other%having%anything%to%do%w ith%the%relationship%of%the%parties,%and%all%persons%
acting%by,%through,%under%or%in%con cert%w ith%any%o f%them%from%any%and%all%charges,%complaints,%claims,%
liabilitie s ,%o b lig a tio n s,%pro mises,%a gre e ments,%con tro v er sie s,%da m a g e s,%actio n s ,%c a u se s%of%action,%s uit s,%
rights,%dem an ds,%costs,%losses,%debts%and %expe nse s%(includin g%attorn eys'%fees%and %costs%actually%incu rred)%
of%any%nature%whatsoever,%known%or%unknow n,%suspected%or%unsuspected,%including,%but%not%limited%to,%
rights%a rising %o ut%of%a lleged %violations %of%a n y%con tra ct s,%expr es s%or%implie d ,%any%cove n an t %of%g oo d %faith%
and%fair%dealing,%express%or%implied,%or%an y%tort,%or%an y%federal,%state%or%o ther%governmental%statute,%
regulatio n,%o r%ord ina nce .%Th is%pa ragra ph %sha ll%ha ve%n o%a pp licab ility%to%C laim s,%if%any,%based%totally%on%
events%occurring%after%the%d ate%of%closing%of%this%Agreement%nor%affect%any%rights%or%obligations%arising%
from %this%A gree m e nt.%
%(b)%Ex cep t%a s%h ere in%otherwise%agreed,%ea ch %pa rty%hereby%irrevo ca bly%and%un con d itiona lly%
release s,%acq uits%an d%forever%d ischarges%the%oth er%from %any%an d%all%charges,%com plaints,%claims,%
liabilitie s ,%o b lig a tio n s,%pro mises,%a gre e ments,%con tro v er sie s,%da m a g e s,%actio n s ,%c a u se s%of%act io n ,%s u its ,%
rights,%dem an ds,%costs,%losses,%debts%and %expe nse s%(includin g%attorn eys'% fees%and% costs% a ctually% incurred)%
of%any%nature%whatsoever,%known%or%unknown,%suspected%or%unsuspected%as%of%the%date%of%the%execution%
of%this%Agreement,%by%reason%of%any%act%or%omission%concerning%any%matter,%cause,%or%thing.%
3.%Knowing%and%V oluntary%Waiver%by%the%Parties%
The%parties%expressly%waive%and %relinquish%all%rights%and%benefits%afforded%by%Section%1542%of%the%Civil%
Code%of%the%State%of%California,%and%do%so%understanding%and%acknowledging%the%significance%of%such%
specific%waiver%of%Section%1542.%Section%1542%of%the%Civil%Code%of%the%State%of%California%states%as%follows:%
%"A%gene ral%release%do es%no t%exten d%to%claims%w hich%th e%creditor%d oes%n ot%kn ow %or%su spect%to%
exist%in%his%favor%at%the%time%o f%executing%the%release,%w hich%if%know n%by%him%mu st%h ave %ma terially%
affected%his%settlement%with%the%debtor."%
Thus,%notwithstanding%the%provisions%of%Section%1542,%and%for%the%purpose%of%implementing%a%full%and%
complete%release,%the%parties%expressly%ackn owledge %that%this%Mutual%General%Release%is%intended%to%
inclu d e%in%its%effe ct ,%with o u t%lim it at ion ,%all%claims%which%the %part ies %do %not %kno w%or%su sp e ct %to%exis t%at%
the%time %of%exe cu tion%h ereo f,%and %tha t%this%M utu al%Ge ne ral%Rele ase%co n tem p lates%th e%extin guish m en t%of%
any%such%claim%or%claims%and%an y%right%to%su e%reg arding%any%such%claim%or%claims%(except%for%un cured%
breaches%of%this%Agreement%occurring%after%the%date%first%w ritten%above).%
G.%REPRESENTATIO NS%AND%WARRANTIES%OF%BUYER%
Buyer%represents%and%warrants%that%it%is%a%company%in%good%standing%in%the%state%of%California%and%has%
the%legal%right%a nd %autho rity,%including%all%n ec essa ry%appro va ls%from%its%m e m be rs,%to%e nte r%into%and%
conclude%this%transaction.%%
Buyer%represents%and%warrants%that%upon%the%receipt%of%all%due%diligence%m aterials%from%seller%it%will%
conduct%its%due%diligence%review%in%a%timely%and%good%faith%manner.%
Buyer%represents%and%warrants%that%it%w ill%use%its%best%efforts%in%a%timely%fashion%to%secure%necessary%
fund ing%for%this%prop ose d%trans actio n %and%to%the%exten t%neces sary %to%arrive%at%an%understanding%with%all%
third%p arties%regard ing%n ec essa ry%p ermits,%licens es,%lea ses ,%fran chise %a gree m en ts%a nd %o the r%p ertine nt%
matters.%
Buyer%represents%and%warrants%that%it%knows%of%no%reason%(economic,%legal%or%otherwise)%why%it%should%
not%enter%into%this%Agreement.%%
%
Buyer%agrees%to%provide%a%comprehensive%list%of%assets%being%purchased%in%this%transaction%and%deposit%
the%list%in%esc row %p rior%to %closin g.%General%categories%such%as,%but%not%limited%to,%“all%supplies”%may%be%
used%when%practical.%Any%assets%not%on%the%list%remain%the%property%and%responsibility%of%seller.%%
Buyer%agrees%to%comply%with%all%applicable%provisions%of%the%Bulk%Sales%Act.%
Buyer%will%com mission%a%UCC%search%and%deposit%the%results%in%escrow%prior%to%closing.%
H.%FURT HER%RE P RESEN T A T IONS%A N D%WARRANTIES%OF%SELLER%
Seller%agrees%to%maintain%its%normal%operations,%including,%but%not%limited%to,%maintaining%current%levels%
of%membership%sales%prices,%during%the%pendency%of%this%transaction%and%further%agrees%that%it%will%sign%
no%other%agreement%for%the%pu rch ase %or%oth er%d ispo sition %of%the %assets %durin g%the %Du e%D iligen ce %perio d.%
Upon%reasonable%notice,%seller%agrees%to%supply%reasonable%access,%during%regular%business%hours%to%
buyer%during%the%D ue%Diligence%period%to%all%of%its%usual%and%normal%business%records%for%its%operations%
during%the%three%(3)%years%immediately%prior%to%the%date%of%this%Agreement.%Usual%and%normal%business%
record s%includ e,%but%are %not%limite d%to%(in%the%po ssess ion %of%seller%and%an y%agen ts%and %profe ssio na ls),%all%
books% and%records%of%seller,%a ll%g en eral%ledgers,%b oo kke ep ing %re co rds,%audit%an d %a cco un ting %work%p ap ers%
and%notes,%financial%statements,%worksheets,%spreadsheets,%budgets,%projections,%price%lists,%client%lists,%
employee,%client%and%independent%contractor%agreement,%contrac ts%and%files,%ad ve rtising%and%
promotional%materials,%bank%records%and%statements,%business%licenses,%franchise%agreements,%real%and%
personal%property%leases,%conditional%use%and%other%permits,%professional%or%trade%licenses,%tax%returns,%
third%party %creditor% and%supplier% files;%correspondence%with% third%parties%regarding% b usiness% and/or%legal%
matters%of%seller;%equipment%sale,%lease,%maintenance%and%repair%records;%in%sum,%any%information%of%a%
material% nature%in% assisting%buyer%in%determining%whether% to%move%forward%with%this%transaction%and%to%
determine%w hat%assets%to%purchase.%
Seller%represents%and%w arrants%that%it%w ill%supply%buyer%with%all%relevant%du e%diligence%m aterials%in%a%
complete,%timely%and%go od%faith%m anner.%Seller%represents%and%warrants%that%it%w ill%revea l%(du ring%the%
Due%Diligence%period)%all%debts%and%legal%obligations%owed%to%anyone%or%anything%regarding%seller%and%
the%businesses %a nd %the%asse ts,%a s%w e ll%as %a ny%pend ing%or%threa ten ed %c laim s%o r%legal%action s,%in clud ing%
compliance%with%all%applicable%provisions%of%the%Bulk%Sales%Act.%
Seller%represents%and%warrants%that%seller%has%operated%and%is%operating%the%businesses%in%accordance%
with%all%applicable%laws%and%regulations%and%that%any%required%franchise%agreements,%licenses%and%
permits%are%currently%in%force%and%fully%transferable%(to%the%best%of%seller’s%knowledge)%to%Buyer.%%
Seller%represents%and%warrants%that%it%has%the%legal%right%to%enter%into%this%transaction%and%to%do%so%will%
not%infringe%upon%the%rights%of%any%other%person%or%entity,%and%further%that%there%are%no %outstanding%
law su its %o r%cla ims%again s t%it%o r%p e n d in g%(t o %its %kn o w le d g e)%r eg a rd in g%t h e%b u s ine s se s%a n d %th e %as s et s.%%
%
Seller%represents% and%warrants% that%it% will% take% n o%conscious% actions% (or% om issions)%that%will% intentionally%
devalue%the%assets,%the%prem ises%an d%the %b usinesses.%Seller%agrees%to%defend%and%protect%the%assets,%
premises%and%businesses%against%damage,%theft,%m isappropriation%and%other%forms%of%abusive%or%illegal%
use%or%activity%by%seller%or%others%until%this%transaction%close s .%
Seller%w ill%deliver%actual%possession%of%all%assets%an d%businesses%p urchased%by%seller.%
Subject%to%buyer’s%agreem ents%with%lessor,%seller%will%deliver%actual%possession%of%the%b usinesses%
premises%upon%closing.%
Except%as%disclosed%by%seller%to%b uyer%in%writing%during%the%Due%Diligence%period,%all%assets%of%seller%are%
undamaged%and%serviceable%for%normal%use%in%the%businesses,%and%except%for%reasonable%wear%and%tear,%
will%remain%in%such%condition%until%closing.%Any%asset%damaged%during%the%Due%Diligenc e%period %shall%b e %
repaire d%or%re plac ed ,%as%circumstances%w arra nt.%
Seller% agrees%to%act%as%a%liaison%(up%to%5%hours%per%week),%for%a%period%of%six%(6)%mo nths%from%the%date%of%
closing,%to%introduce%buyer%and%help%acclimate%b uyer%to%any%relationships%in%place%with%third%parties%in%
the% op eratio n% o f%th e% bu sine sse s.%These%relationships%include,%but%are%not%limited%to,%companies%providing%
services%a nd%pro ducts,%lessor%relationships%(businesses%prem ises,%equipme nt%and%oth er%personal%
property),%franchise%relationships%and%the%City%of%___________.%
Assuming%the% closing% of% this%transaction,%seller% agrees%to% vacate%the% businesses% premises%(along%with% any%
personal%property% not%included% in% buyer’s% asset%list)% in% an%orderly%and% timely% fashion,% with% no%damage%to%
the%premises%and%contents.%Seller%shall%deliver%possession%of%the%assets,%businesses%and%p remises%in%a%
clean,%functional%an d%serviceable%condition.%Seller%shall%send%a%notice%of%transfer%of%ownership%of%the%
businesses%to%the%membership%at%closing.%The%form%of%such%notice%shall%be%deposited%in%escrow%and%
reason ab ly%ap pro ve d%by %bu yer%p rior%to%clo sing .%
%
I.%CO N F IDENTIA L IT Y%
Seller%and%buyer%represent%and%warrant%that%they%w ill%hold%this%Agreement%in%confidence%and%in%
accordance%with%the%following:%
a.The%provisions%of%this%Agreem ent%are%con fidential%a nd%private%and %are%not%to%be%disclosed%to%
outside%parties%(except%on%a%reasonable%need%to%know%basis%only)%without%the%written%and%
express,%advance%consent%of%all%parties%hereto.%
%
b.Buyer%agrees%and%acknowledges%that%in%its%association%w ith%seller%under%this%Agreement%(and%
prior%to),%it%may%come%into,%or%has %suc h ,%possession%or%knowledge%of%confidential%and/or%
proprietary%information.%Such%confidential%and/or%proprietary%information%includes,%but%is%n ot%
limit ed %to:%information %regarding% agents,% contractors,%em ployees% and % all%affiliates%of% which% seller%
possesses%an%ownership%interest%of%ten%percent%(10%)%or%greater;%corporate%and/or%financial%
infor m a tio n %an d %rec o rd s%of %or%any%client,%customer%or%associate%of%seller;%cust o mer%information;%
client%information;%shareholder%information;%business%contacts;%investor%leads%and%contacts;%
employee%information;%franchisor%contacts,%documents%regarding%seller’s%website%(if%seller%has%a%
website)%and%any%product,%bus in e ss %p la n %o r %p re s e n ta tion%ma terials%of%seller.%
%
c.Seller%and%bu yer%represent%and%warrant%to%each%other%that%they%will%not%divulge%confidential,%
proprietary%information%of%seller%or%any%of%its%subsidiaries%(and%of%buyer%as%material%is%deposited%
in%escro w)%to%anyone%or%anything%without%the%written%and %express,%advance%con sent%of%the%
parties%during%the%Due%Diligence%period,%and%after.%
%
J.%FORCE%M AJEURE%
The%parties%are%not%responsible%for%any%delay%or%financial%loss%regarding%this%Agreement%caused%by%any%
unforeseen%event(s),%act(s)%or%omission(s)%of%others%not%within%their%control,%including,%but%not%limited%to,%
labo r%sto p p ag e s%or%strik e s,%lack %of%acc es s%to%loc a tio n s,%eq u ipment%or%facilit ies ,%inte rru p tio n %or%ces sa tio n %
of%any%public%services%or%utilities,%inclement%weather,%natural%disasters,%riots%or%civ il%disturb an ce s,%
terrorism %o r%h ara ssm e nt,%a cts%of%w ar%or%agg ressio n,%s ickne ss,%in jury,%d ea th,%incapa city,%co ntra ctu al%
disputes%and%adverse%econom ic%conditions.%
%
K.%ASSET%PURCHASE%AGREEMENT%
The%parties%entered%into%an%Asset%Purchase%Agreement%dated %on%o r%ab ou t%M arc h%12 ,%%%________.%Said%
agreement%is%attached%hereto%as%Exhibit%“D ”%and%incorporated%herein%by%this%reference%as%if%fully%set%
forth%h ere in.%If%there %is %a n y%discrep a n cy %o r %d iffe re n c e %in %the%term s %o f%the%As se t %P u rc h as e %A g re e m e n t%and%
this%agreement,%this%agreement%controls.%
%
L.%MISCELLANEOUS%LEGAL%CONSIDERATIONS%
1.%Modifications%and%Amendm ents.%The%terms%and %conditions%of%this%agreemen t%ma y%be% am ended% at%
any%time%and%from%time%to%time,%in%whole%and%in%part,%upon%written%agreement%signed%by%a%duly%
authorized%representative%of%the%buyer%and %seller.%
2.%Expenses.%Each%party%shall%bear%its%own%respective%costs,%fees%and%expenses%associated%w ith%
entering%into%and%executing%its%duties%under%this%agreement.%
3.%In d emnificat io n.%Each%party,%if%an%o ffending%party,%agrees%to%indemnify%and%hold%harmless%the%other%
party%from%any%claim%of%damage%of%any%party%or%nonZ party%arising%out%of%any%act%or%omission%of%the%
offending%party%arising%from%this%agreemen t.%
4.%Notices.%Any%notice,%request,%proposal,%statement%or%other%communication%required%or%permitted%to%
be%given%hereunder%shall%be%in%writing%and%shall%be%deemed%given%w hen%personally%delivered%or%
confirmed%by%facsim ile%or%five%(5 )%days%after%m aile d%by%ce rtified %mail,%p osta ge %prepaid,%to%the %parties%at%
their%respec tive%ad dre sses%first%set%forth%ab ov e%or%to%such %oth er%add ress %of%wh ich%a%party %shall%hav e%
thereto fore %n otified %th e%o the r%b y%a %n otice %give n%in%accordance%w ith%this%Paragraph%4 .,%togethe r%w ith %a%
courtesy%copy%to%the%receiving%party's%counsel,%as%follow s:%
%

If%to%the %Bu yer:%
%
%
%
And%to%Buyer’s%Attorney:%
Pete%Wilke,%Esq.%
_______________________%
_______________________%
%%
If%to%Seller:%
%
%
%
And%to%Seller’s%Attorney:%
Law%Offices%of%___________%
________________________%
________________________%
%
5.%Breach.%In%the%event%of%a%breach%of%this%agreement,%the%breaching%p arty%sh all%be%notified%by%the%other%
party%by%w ritten%notice%within%ten%(10)%days%of%reasonable%discovery%of%the%breach.%The%breach%shall%be%
cured%within%fifteen%(1 5)%days%of%written%notice.%If%th e %bre a ch%is%n ot%cured%within%this%period,%the%nonZ
breaching%party%may%take%appropriate%legal%action%consistent%with%the%terms%of%this%agreement.%
6.%Assignment.%The%provisions%of%this%agreemen t%shall%be%binding%upon %and%inure%to%the%ben efit%of%the %
buyer%an d%seller%and%their%respective%successors,%assigns%and%personal%representatives.%If%the%buye r%
and/or%seller%shall%at%any%time%b e%m erged %or%consolidated%into%or%with%an y%o ther%co rporation %or%the%
compa ny’s%capital%ow nership% units%or%substantially%all%of%its%assets%are%transfe rred %to%another%entity,%th e %
provisions%of% this%agreem ent%shall% b e% b inding% up on%and%inure%to% the%benefit% of%the%buy er%or%the%seller%(as%
the%cas e%m ay %be)%and%the%entity%resulting%from%such%merger%or%consolidation%or%to%which%such%capital%
ownership%units%or%assets%shall%be%transferred,%and%this%provision%shall%apply%in%the%event%of%any%
subsequ ent%me rger,%consolidation%or%transfer.%
7.%Entire%Agreement.%This%agreement%is%the%full%an d%complete,%integrated%agreement%o f%the%parties,%
superseding%all%previous%written %and/or%oral%agree m en ts%and%rep res en tation s%betwee n%the%pa rties,%a nd %
is%ame n d ab le %only%as%provided%for%above.%This%agreement%shall%be%interpreted%as%if%the%parties%
participated%equally%in%its%drafting.%%
8.%Governing%Law.%This%agreem ent%sha ll%b e%governed%by%the%laws%of%the%State%of%California%
applicable%to%contracts%made%to%be%performed%entirely%therein,%and%each%party%agrees%to%subm it%to%the%
personal%jurisdiction%of%any%Court%of%competent%jurisdiction%and%venue%in%Los%Angeles%County%and%to%all%
the%rules%and%orders%of%such%Court,%and%the%laws%of%the% State%of%California.%
9.%Waiver.%Any% waiver%by%either%party%of%any%provision%of%this%agreement%or%a ny%right%hereun der%shall%not%
be%deemed%a% continuing% w aiver%and%shall%not%p rev en t%or%stop %such%party%from%thereafter%enforcing%such%
provision,%and%the%failure%of%either%party%to%insist%in%any%one%or%m ore%instances%upon%the%strict%
performance%of%any%of%the%provisions%of%this%Agreement%by%the%other%party%shall%not%be%construed%as%a%
waiver%or%relinquishment%for%the%future%performance%of%any%such%term%or%provision,%but%the%same%shall%
continue%in%full%force%and%effect.%
10.%Enforcement.%If%th e %p a rtie s %ca n n o t%s et tle %an y %d isp u t e%a ris in g %o u t%o f%o r%re la tin g %to %this%
Agreement,%or%the%breach%thereof,%in%a%reasonable%and%timely%fashion,%and%a%mediation%session%has%
failed,%eithe r%party %m ay%file%for%b ind ing%arbitration%within%Los%Angeles%County,%California.%Arbitration%shall%
be%governed%by%the%rules%of%ADR%Services,%Inc.%and%judgment%upon%the%aw ard%may%be%entered%in%any%
Court%within%Lo s%A ng e le s%Co u n ty %having%jurisdiction%thereof.%However,%the%parties%agree%to%reserve%the%
right%to%ob tain %a%prelim in ary%in jun ction %from %a%co u rt%of%comp eten t%jurisd iction %if%nece ssary %in%the %even t%
of%a%m aterial%breach%arising%from%this%agreement.%
11.%Headings.%The%headings%in%this%agreement%are%solely%for%convenience%of%reference%and %shall%not%
affect%its%interpretation.%
12.%Possible%In validity.%In%case %any %pro vis io n %of%this%agreement%should%be%held%to%be%contrary%to,%or%
inva lid%under,%the%law%of%any%state%or%other%jurisdiction%in%which%enforcement%is%sought%or%challenged,%
such%illegality% or%invalidity%shall%n ot%affect%in%any%way %any%of%the%othe r%provisions%hereo f,%th is%Agreem ent%
in%su c h%event%t o %b e%constru e d %a s%t h o ug h %t h e%offendin g %p ro v isio n %h a d %b e en %d e le t ed%or%mod ified% in%such% a%
manner%as%to%make%it%enforceable%to%the%maximum%extent%possible%to%reflect%the%parties'%intent%
hereunder,%and%all%of%the%provisions%hereof%nevertheless%shall%continue%unmodified%and%in%full% force%and %
effect%in%any%state%or%o ther%jurisdictio n.%
13.%Counterparts.%This%agreement%may%be%executed%in%counterparts,%each%of%which%shall%be%
deemed%an%original%and%all%of%which%together%shall%constitute%one%and%the%same%agreement.%Facsimile%
signatures%shall%be%considered%as%valid%and%binding%as%original%signatures.%
%