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: Unbalanced termination rights can trap a party in an unfavorable contract or allow abrupt terminations, leading to service gaps and potential damages.
Negotiation strategy
If you're the Buyer:
Negotiate for flexible termination rights, ensuring the ability to exit the contract for convenience with reasonable notice. Include transition support to mitigate disruptions.
If you're the Seller:
Secure a stable contract term with automatic renewals, but allow for termination in case of material breach. Ensure notice periods are sufficient to address any issues.
Essential elements
1
Term of Agreement
Defines contract duration.
2
Renewal
Automatic renewal terms.
3
Termination for Material Breach
Rights to terminate for breach.
Action framework
ACCEPT
Propose edits to adjust notice periods and include transition support.
EDIT
Reject if termination rights are overly restrictive or lack transition support.
ADD
Add clauses for jurisdiction-specific compliance and transition support.
PRO TIP
Always include a cure period for material breaches to allow for resolution before termination.
Example clauses
FAVORABLE
Preferred Term of Agreement
"The term of this Agreement shall commence on the Effective Date and shall continue for a period of [insert duration], unless earlier terminated in accordance with the provisions of this Agreement."
NEUTRAL
Template Transition Support
"In the event of termination or expiration of this Agreement, the parties agree to cooperate in good faith to provide transition support for a period of [insert duration] to ensure an orderly transition and mitigate operational disruptions."
UNFAVORABLE
Restrictive Termination Rights
"Termination is only allowed upon mutual agreement, with no provision for material breach or convenience."
Fallbacks
High-Risk Projects
In high-risk projects, ensure termination clauses allow for quick exit strategies to minimize potential losses.
Long-Term Partnerships
For long-term partnerships, focus on renewal terms and transition support to maintain continuity.
Jurisdiction-Specific Requirements
Ensure compliance with local laws and regulations that may affect termination rights and obligations.
FEATURED SOLUTIONS
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Unlike complex CLMs with long implementations and steep learning curves, DocJuris is built for speed and simplicity. We integrate with your workflow—whether connecting to a CLM or uploading agreements manually—so you're up and running in days, not months.
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.