(a) the purchase price payable by TJC for the assets (the «purchase price») is $335,000, subject to adjustment in accordance with Section 4, d; NOW, THEREFORE, in light of the reciprocal agreements, agreements and commitments contained in this content and other valuable considerations that are recognized by all parties, the parties agree in the following way: It is customary for the franchisee/seller to have paid in advance for certain expenses related to the operation of the business — utilities and rent, for example. Expenses paid in advance often cover a period beyond the conclusion of the purchase. In this case, the price is adjusted to take into account the period during which the seller used the service before closing and the buyer used the service after closing. The description of the assets should be a complete explanation of what is included in the sale. These are not only hard assets (tables, chairs and inventories), but also all «soft» (intangible) assets that are not held by the franchisor. Keep in mind that your business is identified with the franchisor`s trademarks and intellectual property. Although you can transfer your limited rights to the franchise agreement (in fact, it will be one of the assets described as an asset), you do not transfer any property rights to trademarks or intellectual property. In addition to all the other conditions mentioned in the asset sale agreement, there will generally be an agreement that will recite additional conditions that will have to be met before the buyer is obliged to conclude. This method of sale is obtained by executing an asset purchase agreement in which you agree to sell all of your company`s assets to third parties.
Under the asset sale agreement, the buyer buys only the assets, the good or the good-corporate and the right to operate the transaction — but none of the liabilities (except for the resumption of the franchise agreement). The vast majority of franchise transfers are through the use of the asset acquisition contract, as most buyers have no interest in paying off the seller`s debts. While this is a new business for you, you also need to find out the terms of the agreement your franchisor will grant you.