An Asset Purchase Agreement governs the sale and transfer of specific business assets, detailing what is included, excluded, and how liabilities are handled. This playbook walks through due diligence, valuation considerations, and risk allocation terms essential for a clean transaction.
Why This Matters: Non-compliance can result in fines, criminal liability, and reputational damage, exposing the client to significant legal and operational risks.
Negotiation strategy
If you're the Buyer:
Ensure that compliance clauses are comprehensive and include specific obligations for the Contractor to notify the Company of any regulatory changes. This will help mitigate risks and ensure ongoing adherence to legal requirements.
If you're the Seller:
Negotiate for reasonable timeframes and clear definitions of compliance obligations to avoid undue burdens. Ensure that the Company provides necessary support and information to facilitate compliance.
Essential elements
1
Compliance with Laws
Adherence to legal requirements.
2
Regulatory Change Notification
Prompt updates on legal changes.
3
Ongoing Compliance
Continuous adherence to standards.
Action framework
ACCEPT
Propose edits when specific industry standards are not addressed or when the language is too vague.
EDIT
Reject if the clause imposes unreasonable compliance burdens without mutual obligations.
ADD
Add language to cover industry-specific regulations or emerging legal requirements.
PRO TIP
Regularly review and update compliance clauses to reflect changes in the legal landscape and industry standards.
Example clauses
FAVORABLE
Preferred Compliance Clause
"Each party represents and warrants that it is in compliance with all applicable laws, regulations, and industry standards relevant to the performance of its obligations under this Agreement. Each party shall maintain such compliance throughout the term of this Agreement."
NEUTRAL
Basic Compliance Acknowledgment
"Each party acknowledges its obligation to comply with applicable laws and regulations."
UNFAVORABLE
Limited Compliance Obligation
"Each party will attempt to comply with applicable laws as feasible."
Fallbacks
High-Risk Projects
In high-risk projects, compliance clauses should include detailed risk assessments and mitigation strategies to address potential legal and operational challenges.
International Operations
For international operations, ensure compliance clauses address cross-border regulations and include provisions for local legal counsel consultation.
Technology Transactions
In technology transactions, compliance clauses should cover data protection laws and cybersecurity standards to safeguard sensitive information.
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WEEK 1
CLM Readiness and Design
Our CX team works with you to understand your contracting challenges, prioritize key workflows, and identify the biggest impact areas. We build a tailored implementation plan that fits your needs.
WEEK 2
Install Module
We connect DocJuris to your contract repositories, set up admin and user accounts, and ensure your environment is ready for success.
WEEK 3
Deliver & Test
Your team builds initial playbooks, reviews existing clause libraries, and trains the DocJuris agent to align with your internal standards and negotiation positions.
WEEK 4
Launch
We support you in rolling out DocJuris to a pilot group or your full organization—with launch materials, training, and hands-on support to drive adoption from day one.
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DocJuris is not a law firm or a substitute for an attorney or law firm. We cannot provide any kind of advice, explanation, opinion, or recommendation about possible legal rights, remedies, defenses, options,selection of forms or strategies.