**SAMPLE**

ASSET PURCHASE AND SALE AGREEMENT

THIS ASSET PURCHASE AND SALE AGREEMENT is made as of the _____ day of ______, 200__ by and between ______, a [State] [corporation, LLC, etc] doing business as “Molly Maid of XX” located at XX (“Seller”), and ______, a [State] [corporation, LLC, etc] located at XX (“Buyer”).

RECITALS

  1. Seller is engaged in the business of owning and operating a residential cleaning business under the name and mark “Molly Maid,” located at XX (herein referred to as the “Molly Maid Business” or the “Business”), pursuant to a Franchise Agreement dated XX (“Franchise Agreement”) among Seller, [Seller’s owner] and Molly Maid, Inc. (“Franchisor”).
  1. Seller desires to sell, and Buyer desires to purchase, certain assets of Seller used or usable in connection with the Molly Maid Business including an assignment by Seller of its franchise and Molly Maid Business, all on the terms and conditions set forth below.

NOW THEREFORE, in consideration of the covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Sale Of Assets. At Closing (as defined below), Seller shall sell, assign, transfer and deliver to Buyer, free and clear, and Buyer shall purchase and accept, all right title and interest in and to all of the tangible and intangible assets of Seller used or usable in connection with the Molly Maid Business (collectively, the “Assets”) including without limitation the following:

A. Personal Property. All of the equipment, machinery, computers, supplies, inventory, signs, furniture, fixtures and other tangible assets owned by Seller or used or usable in connection with the Business. All of such tangible assets are listed in ExhibitA. The parties agree the inventory shall have a minimum value of XX and a maximum value of XX, based on Sellers cost.

B. Vehicles. Title to the vehicles used in the Business, as listed on ExhibitB.

C. Customer Lists And Intangible Property. All customer lists, supplier lists, goodwill and telephone numbers (Phone: ______and Fax: ______) used in connection with the Molly Maid Business.

D. Leases, Contracts, Licenses And Permits. All of the Seller’s rights and interest in, to, under or arising from any and all real property leases, equipment leases, contracts, licenses and permits which are used or usable in connection with the Molly Maid Business (collectively, the “Assigned Agreements”) including without limitation that certain Lease (the “Lease”) dated ______between Seller, as tenant, and ______, as Landlord (the “Landlord”) for the premises located at ______(the “Premises”). All of the Assigned Agreements are listed on ExhibitC.

E. Books And Records. Copies of all books, documents and records in the possession or under the control of the Seller (though in the possession of others) with respect to the Assets or the Molly Maid Business.

F. Excluded Assets. The following assets of Seller (the “Excluded Assets”) are excluded from the Assets and shall be retained by Seller: (a)the name ______; (b)any cash, undeposited checks and monies and checks and monies in transit and subject to cancellation; (c)accounts receivable; and (d)any insurance policies.

2. Purchase Price. The total purchase price (the “Purchase Price”) to be paid by Buyer to Seller for the Assets shall be XX. The Purchase Price shall be payable as follows:

A. Earnest Deposit. Within two(2) business days of Seller’s execution of this Agreement, Buyer will deliver to XX earnest money deposit of XX (the “Deposit”) which Deposit will be held for the benefit of the parties. In the event this Agreement is terminated without Buyer’s fault, the Deposit shall be returned to Buyer. Provided however, if this Agreement is terminated as a result of Buyer’s breach of this Agreement, then the Deposit shall be forfeited and retained by Seller as liquidated damages. The parties acknowledge and agree that Buyer’s failure, despite its good faith efforts, to comply with the Franchisor’s approval procedures, including but not limited to the successful completion of it training program, shall not be considered a breach by Buyer for the purposes of this Section2.A.

B. Payment At Closing. At Closing, Buyer shall pay XX, payable as directed by Seller in cash or certified or cashier’s check.

[C. Promissory Note. The remaining balance of the Purchase Price shall be paid by Buyer to Seller by a promissory note (the “Promissory Note”) payable over XX years, based on an amortization of XX equal monthly installments of principal and interest at the rate of XX per annum, with a balloon payment due at the end of the XX.]

3. Allocation Of Purchase Price. The parties agree that the Purchase Price shall be allocated as follows:

i. $______all furniture, fixtures, and equipment;

ii. $______for the XX vehicles;

iii. $______for inventory and supplies;

iv. $______goodwill of the business;

v. $______covenant not to compete.

4. Assignment And Assumption Of Lease. At Closing, Seller shall assign, and Buyer shall assume, the Lease upon the terms and conditions set forth in said Lease. Seller will use its best efforts to obtain the Landlord’s consent to the assignment. In connection with such assignment, at Closing Buyer will pay Seller XX, and Seller will assign to Buyer all of its right, title and interest to the security deposit paid by Seller to Landlord under the Lease.

5. Taxes; Prorations. The parties agree to prorate as of the Closing Date (as defined below) the rent, real estate taxes, personal property taxes and other applicable costs and expenses. The parties further agree that all bills for utilities, telephone and other services billed monthly will be prorated between the parties as of the Closing Date.

6. Transfer Fee. The parties acknowledge and agree that a transfer fee of $9,900.00 is to be paid to Franchisor when the franchise agreement for the Buyer is delivered to Franchisor. Seller hereby instructs Buyer to pay $9,900 of the Purchase Price to Franchisor as payment of such transfer fee pursuant to the Franchise Agreement.

7. Assumption Of Liabilities/Accounts Payable. Except as specifically provided in this Agreement, Buyer does not assume (and shall not be deemed to have assumed or agreed to pay, perform, or discharge) any liability or obligation of Seller of any nature whatsoever. The parties agree that the Seller shall be liable for all of Seller’s Accounts Payable as of the Closing Date, and that Buyer shall be liable for all amounts incurred after the Closing Date.

8. Sales Taxes On Assets. In the event there are any sales taxes imposed on the purchase by Buyer of the Assets, Buyer shall be liable for payment of said sales taxes.

9. Representations And Warranties Of Seller. Seller makes the following representations and warranties to Buyer of the date of this Agreement and of the Closing Date. The representations and warranties shall survive closing without limitation.

A. Organization, Authority. Seller is a [corporation/LLC] duly organized, validly existing and in good standing under the laws of the state of XX. Seller has the requisite power and authority to (i) own, lease and use the property belonging to the Seller as presently owned, leased and used, and (ii) to conduct and carry on its business as now conducted. Seller has the requisite power and authority to execute, deliver and perform this Agreement. The consummation of the transactions contemplated by this Agreement, including the execution and delivery of this Agreement, has been approved by all requisite action of Seller.

B. Binding Agreement. This Agreement and all other documents, agreements and instruments contemplated by this Agreement have been duly and validly authorized, executed and delivered by Seller and are valid and binding upon it.

C. Title To Assets. Seller has good and marketable title to the Assets free and clear of all security interests, liens or other encumbrances of any nature except as set forth on ExhibitE attached hereto.

D. Franchise Agreement and Leases. Seller is not in default under the Franchise Agreement or the Lease, and the Franchise Agreement and Lease are in full force and effect. There are no other agreements or addenda between Seller and the Landlord that modify in any manner the Lease.

E. No Suits Threatened Or Pending: Compliance With Laws. There is no suit, action, claim, arbitration or other proceeding pending, or to the best of Seller’s knowledge, threatened against or affecting Seller, the Assets or the Molly Maid Business. To the best of Seller’s knowledge, the operation of the Molly Maid Business is not in violation of any current law, regulation, code or ordinance. Further, Seller is not in violation of or in breach of any contract, lease or other agreement or subject to any judgment, decree or order which may materially and adversely affect the Corporation, the Business, or the Assets.

F. Taxes. Seller has paid all income taxes, employment taxes, including FICA, withholding, State and Federal Unemployment Taxes, Sales Taxes and all other taxes, dues and other obligations required to be paid by Seller in the operation of the Business.

H. Financial Statements. Seller’s financial information previously disclosed to Buyer fairly presents the financial condition of Seller as of the date thereof.

I. Employees. Attached hereto as Exhibit D is a list of all of the Seller’s employees who provide services in connection with the Molly Maid Business along their rate of pay, hours worked and length of employment with Seller. Seller is not a party to any labor or collective bargaining agreement relating to the employees retained by Seller in connection with the operation of the Business, and during the past three years, no union has sought to organize the employees or has sought an election.

10. Representations And Warranties Of Buyer. The Buyer covenants, represents and warrants with, and to, Seller as follows. The representations and warranties shall survive closing without limitation.

A. Organization/Authority. Buyer is a corporation, duly organized, validly existing and in good standing under the laws of the State of Michigan, with full power and authority to execute, deliver, perform, and consummate the provisions of this Agreement.

B. Approval. The consummation of the transactions contemplated by this Agreement, including the execution, delivery, performance and consummation of this Agreement by the Buyer, has been approved by all requisite action of Buyer.

C. Binding Agreement. This Agreement and all other documents, agreements and instruments contemplated by this Agreement have been duly and validly authorized, executed and delivered by Seller and are valid and binding upon it.

D. AS IS Condition. Purchaser is purchasing the Property in its “AS IS” and “WHERE IS” condition and all latent and/or patent defects, and except as set forth in this Agreement, expressly without any warranties, representations or guaranties, either express or implied, of any kind, nature or type whatsoever from or on behalf of Seller.

11. Conditions Precedent To Obligations Of Buyer. The obligations of Buyer hereunder are subject to the satisfaction, on or prior to the Closing, of all of the following conditions. The compliance with, or occurrence of, any or all of such conditions may be waived in whole or in part by Buyer, but only in writing:

A. The representations and warranties of Seller contained herein shall be true as of and at the Closing, to the extent applicable and consistent, with the same effect as though made on such date. All obligations and covenants required by this Agreement to be performed or complied with by the Seller on or prior to the Closing Date shall have been duly performed or complied with.

B. Since the date of this Agreement, there shall not have been any material adverse change in the physical condition of any of the Assets, or the Seller’s operations or financial condition.

C. Buyer shall have entered into a Franchise Agreement with Franchisor and completed all of the training required by Franchisor.

D. Seller shall deliver to Buyer an estoppel letter, in form and substance satisfactory to Buyer’s counsel, dated within ten(10) days of Closing from the Landlord, consenting to the assignment of the Lease to Buyer; confirming the terms and conditions of the Lease; confirming that no event or condition of default exists under the Lease; and confirming the non-existence of any setoff or claim for damages under the Lease.

E. Buyer shall have obtained sufficient financing to close the transactions contemplated herein.

F. Franchisor shall have waived its option and right of first refusal to purchase the Business.

G. Seller shall have delivered (or caused to be delivered) to Buyer on the Closing date the closing documents required to be delivered pursuant to Section18.B of this Agreement.

12. Conditions Precedent To Seller’s Obligations. The obligations of Seller are subject to the satisfaction, on or prior to the Closing date, of all the following conditions. The compliance with, or occurrence of, any or all of such conditions may be waived in whole or in part by Seller, but only in writing:

A. The representations and warranties of Buyer contained herein shall be true in all material respects as of and at the Closing, to the extent applicable and consistent with the same effect as though made on such date, except for changes permitted in this Agreement. All obligations and covenants required by this Agreement to be performed or complied with by Buyer on or prior to the Closing Date shall have been duly performed or complied with in all material respects.