Selling or buying a business is a different transaction from buying a piece of equipment — it needs an asset-vs-share election, representations from the seller about what the buyer is actually getting, closing conditions the buyer can rely on, and a plan for handing the business over. Download the ready-to-fill template below, or read the field-by-field checklist first.
A complete, ready-to-fill PDF — 16 clauses, blanks for every detail, and a signature block for both parties. Free, no email, no account. Read it and adapt it before you use it; the cover page explains what it can and cannot do for you.
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This document is a general-purpose template provided for information only. It is not legal advice, it does not create a lawyer–client relationship, and nobody has reviewed it against your situation.
Laws differ by country, state and province, and they change. A clause that is standard in one place can be unenforceable — or illegal — in another. Terms that are ordinary between two businesses can be void in a consumer or employment context.
Read every clause before you use it, fill in every blank, and delete anything that does not apply. For anything high-value, unusual, or that you could not afford to lose a dispute over, have a qualified lawyer in your jurisdiction review it before it is signed.
A generic purchase agreement covers who's selling what to whom for how much. A business sale needs all of that plus the items below — leaving one out doesn't just create an ambiguity, it can leave one side holding a risk it never agreed to take on.
Asset purchase or share purchase
The single decision everything else in the agreement depends on — whether the buyer is acquiring specific assets and goodwill, or the equity of the company that owns the business, liabilities included.
What is actually being purchased
For an asset sale: equipment, inventory, goodwill, trade name, customer lists, the lease. For a share sale: the number or percentage of shares or membership interests being transferred.
Excluded assets and retained liabilities
In an asset sale, what the seller keeps (cash, receivables, personal property) and which pre-closing debts and claims the seller — not the buyer — stays on the hook for.
Purchase price, allocation and payment
The total price, how it splits across the purchased assets for tax purposes, any deposit, and whether any part is seller-financed.
Price adjustment and escrow
A working-capital true-up after closing, and a holdback of part of the price in escrow to secure that adjustment and any warranty claim.
Seller's representations and warranties
Title to the assets or shares, accurate financial statements, no undisclosed liabilities or litigation, valid material contracts, and compliance with law — the seller stating, in writing, what the buyer is actually buying.
Buyer's conditions to closing
A due diligence period the buyer can walk away during, a financing contingency if the purchase depends on a loan, and a bring-down that the seller's representations are still true at closing.
Closing mechanics
The closing date, and exactly what documents change hands — bill of sale or stock powers, lien releases, contract assignments, keys and records.
Transition assistance
A defined period after closing during which the seller helps hand over the business — introducing the buyer to customers and suppliers, explaining how things actually run.
Non-compete and non-solicitation
A restriction on the seller opening a competing business, or poaching employees, customers or suppliers, for a stated time and area after the sale.
Indemnification
Who pays if a representation turns out to be wrong or a retained liability surfaces later — survival period, a minimum claim threshold, and a cap on total liability.
Signatures & date
Both parties sign and date it. Where either party is a company, partnership or other entity, the signer must be authorized to bind it — a business sale this size is not a document to leave unsigned by anyone with real authority.
A general purchase agreement — the kind used for a piece of equipment or a batch of inventory — assumes the transaction is simple: one party owns a thing, the other party pays for it, ownership changes hands. A business is not a thing in that sense. It's a bundle of assets, contracts, relationships, employees and — critically — liabilities, some of which the seller may not even know about. The first thing a business purchase agreement has to settle, before price or closing date, is exactly what “buying the business” means.
That's the asset-versus-share election. In an asset purchase, the buyer picks specific assets — equipment, inventory, the trade name, the customer list, the lease — and, if the parties agree, specific liabilities to assume. Every liability not expressly assumed stays with the seller. In a share purchase, the buyer instead acquires the company that owns the business — its shares or membership interests — and with it, automatically, everything the company owns and owes, disclosed or not. The tax treatment, the paperwork required, and the buyer's exposure to an unknown problem surfacing later all follow from that one choice.
Because a share purchase in particular hands the buyer a company's whole history, the representations and warranties clause carries real weight in a way it doesn't in a simple goods sale: the seller is stating, in writing and with legal consequences, that the financial statements are accurate, that there's no undisclosed liability or pending lawsuit, and that the material contracts are what they appear to be. Pair that with a due diligence period the buyer can actually rely on, a price that adjusts to the business's condition at closing rather than months earlier when it was agreed, and an escrow to back the seller's promises — and the agreement starts to match the size of the transaction it's covering.
The template above builds in all of it: a structure election in clause 1, purchased assets or shares that read correctly either way, seller representations and warranties, buyer conditions to closing covering due diligence and financing, a price-adjustment and escrow mechanism, transition assistance so the seller actually helps hand the business over, a non-compete sized to the goodwill being paid for, and indemnification with a survival period, a threshold and a cap.
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Not legal advice — for a high-value or complicated business sale, have a lawyer review the agreement, and the business's actual liabilities, before you sign.