Pro Forma Sale and Purchase Agreement

You acknowledge that if you choose to use the terms and conditions of this Pro Forma Sale and Purchase Agreement (“SPA”) in relation to the sale of a Seller's Assets of a Venture:

  • The terms and conditions of the SPA have been provided by CrowdMnA as an optional suggested set of terms and conditions for Buyers and Sellers to use in relation to the sale and purchase of the Assets of a Venture. It is not mandatory for Buyers and Sellers to choose to be bound by these terms and conditions.
  • You have had the opportunity to obtain legal advice in relation to the use of the SPA and its suitability for your purposes.
  • By providing the SPA to you, CrowdMnA does not warrant that they are suitable for your needs nor is CrowdMnA providing you with legal advice in relation to them.

Note that this SPA is provided for the sale of assets of a Venture and is not suitable for the sale of shares of a Venture or company. If you are acquiring shares of a company please do not use this SPA and seek legal advice.

Background

The Seller has agreed to sell and the Buyer has agreed to buy the Seller’s Assets of a Venture, and the Seller and the Buyer are deemed to enter into a legally binding agreement in relation to that sale. The Seller and Buyer may together elect that the terms and conditions of this SPA apply to that sale.

Parties

The parties to this SPA are the Seller and Buyer. The SPA will apply to you in your capacity as either a Seller or a Buyer in respect of the sale and transfer of the Assets of the Venture.

Date of this SPA

If the Buyer and Seller elect that this SPA applies, then this SPA will be entered into between the Seller and the Buyer at the time that: (a) the Seller accepts the Buyer's offer to purchase the Assets of the Venture as part of a Private Sale; or (b) the Buyer is declared the Winning Bidder in an Auction for the Assets of the Seller's Venture.

AGREED TERMS

1. Definitions

1.1 In this SPA, words and phrases defined in CrowdMnA’s Terms and Conditions will have the same meaning in the SPA and in addition, the following definitions and rules of interpretation in this clause apply in this SPA.

Assets: the following assets of the Venture to be sold by the Seller to the Buyer:

  1. the Seller's Intellectual Property Rights in the Venture;
  2. the Technology;
  3. the Records;
  4. the Content;
  5. the Moveable Assets;
  6. the Seller's rights under Third Party Agreements; and
  7. any other assets of the Seller which the Seller specifies in its Listing that it is selling as part of the Venture or which are required to operate the Venture as described by the Seller in the Venture’s Listing.

Business Day: a day other than a Saturday, Sunday or a public holiday;

Completion: the completion of the sale and purchase of the Venture (comprising the Assets) pursuant to and in accordance with this agreement including the transfer of the Assets from the Seller to the Buyer undertaken in accordance with clause 4;

Completion Date: any time after the Effective Date when Completion occurs;

Content: the photographs, artwork, drawings, articles, features, editorial content and all other material, in whatever media or form, which relates exclusively to the Assets of the Venture as described in the Seller’s Listing;

Effective Date: the date specified by the Seller in its Listing as the end of the period of Auction in which there is a Winning Bidder or the date of acceptance by the Seller of a Buyer’s offer in a Private Sale or as separately agreed between the Seller and the Buyer;

Encumbrance: any interest or equity of any person (including any right to acquire, option or right of pre-emption) or any mortgage, charge (whether fixed or floating), pledge, lien, assignment, hypothecation, security interest, title retention or any other security agreement or arrangement or conditional sales agreement, hire purchase agreement, option, restriction as to the transfer, use or possession, easement subordination to any right of any other person any other encumbrance or security interest whatsoever;

Loss: any loss, cost, expense or damage (including legal costs on a full indemnity basis);

Moveable Assets:the servers, hardware, assets related to the technology and stock which are owned by the Seller and required for the operation of the Venture as described in the Seller’s Listing;

Records: originals and copies, in any material form, of all books, files, reports, records, correspondence, documents, supplier lists and contact details, customer lists and contact details, price lists, calculations, costings and associated documentation and other material of or relating to or used in connection with the Assets in the possession of the Seller as at the Completion Date; and

Technology: the technology owned or used by the Seller exclusively in the operation of the Venture as described in the Seller’s Listing.

Interpretation

The rules set out in the Terms and Conditions in relation to the interpretation of that agreement will equally apply to this SPA.

2. Sale of the Assets of the Venture

With effect from the Effective Date the Seller hereby agrees to sell the Assets to the Buyer and the Buyer hereby agrees to buy the Assets from the Seller, with full title guarantee and free from Encumbrances, in accordance with the Seller's obligations set out in this SPA under clause 4.3 and also CrowdMnA’s Terms and Conditions and Site Rules.

3. Payment of the Purchase Price

On the Effective Date the Buyer agrees to pay the Purchase Price to an escrow account held by the Escrow Agent for holding on behalf of the Buyer, subject to the Seller and Buyer fulfilling its obligations under clause 4.3 and clause 4.4 respectively, following which the Buyer agrees to approve the Escrow Agent to release the Purchase Price from the escrow account and pay the Purchase Price to the Seller on the Completion Date.

4. Completion

4.1 Time and place of Completion

Completion will take place after the Effective Date on the Completion Date. Completion will be deemed to have taken place at the premises of the Seller, even if Completion occurs electronically.

4.2  Conduct of the Venture Pre-Completion

The Seller will ensure that between the date of this SPA and Completion, the Seller:

  1. carries on the business of the Venture in a normal, proper and efficient manner and manages and conducts that business or asset in the ordinary and usual course, consistent with past practice;
  2. does not make any material changes to the Venture, its content or form (other than changes it would ordinarily make in the usual course of its business);
  3. uses all reasonable endeavours to preserve the goodwill of the Venture;
  4. maintains the Assets and any other assets at normal levels;
  5. does not enter into any transaction with a third party which would have the effect of:
  6. substantially affecting the value or quality of the Assets;
  7. granting any exclusive licence over any of the Assets; or
  8. assigning any part of the Assets to a third party.

4.3 Seller's Obligations

Following written confirmation in electronic form received by the Seller from the Escrow Agent that the Purchase Price has been received into an escrow account from the Buyer, the Seller is obligated to proceed to Completion and the Seller must cause to be delivered to the Buyer:

  • actual possession of the Assets (including any passwords or other authorities needed to access any of the Assets held or hosted by a third party);
  • the Records (although the Seller may keep a copy of the Records for its own compliance purposes);
  • assignment or novation of any Third Party Agreements specified in the Seller’s Listing and subsequently agreed between the Seller and the Buyer in accordance with clause 6;
  • duly executed instruments of transfer, assignment, notices of transfer or assignment or disposal consents and other documents in a form and substance satisfactory to the Buyer (and any required registration, filings or approvals in respect thereof) as the Buyer may reasonably require to complete the transfer, assignment and conveyance of the Assets free from Encumbrances.

4.4 Buyer's Obligations

At the Effective Date, the Buyer is obligated to pay the Purchase Price to the Escrow Agent in accordance with clause 3. Only if the Seller complies with clause 4.3 will the Buyer on Completion approve the release of the Purchase Price by the Escrow Agent to the Seller.

4.5  Simultaneous Actions at Completion

In respect of Completion the obligations of the parties under this SPA are interdependent and conditional on the other party performing their respective obligations at Completion.

4.6  Post-Completion Obligations

If the Buyer has fulfilled its obligations arising under clause 4.4 and:

  • the Seller and the Buyer have at the Completion Date in good faith formed the view that Completion has occurred and it is subsequently later found that the Seller has not in fact met one or more of its obligations under clause 4.3; or
  • the Buyer has agreed in writing to permit an obligation of the Seller required at Completion to be performed after Completion, then;
  • Completion will be deemed to have still occurred; and
  • the obligations of the Seller which have not been met at Completion will, unless expressly waived by the Buyer, be deemed to be obligations of the Seller that must be met as soon as practicable after Completion.

5. Ownership of the Assets

5.1  Ownership

  • Subject to Completion taking place, the legal and beneficial ownership of the Assets shall pass from the Seller to the Buyer at Completion, free from all Encumbrances.
  • If for any reason full title to any of the Assets is not effectively vested in the Buyer at Completion, the Seller acknowledges that it will account to the Buyer for any benefits it receives in relation to the Assets until full title is effectively vested in the Buyer, unless otherwise provided in this SPA.

5.2  Risk of Loss

Subject to Completion taking place, risk of loss of the Assets shall pass to the Buyer from Completion and remain with the Seller until that time.

6. Transfer of Third Party Agreements

6.1  Third Party Agreements

The Third Party Agreements which the Seller will transfer to the Buyer under this clause are those Third Party Agreements specified in the Seller’s Listing for inclusion in the sale of the Venture.

6.2  Buyer to Take Benefit of Third Party Agreements

  • Subject to Completion, but with effect from the Completion Date, the Seller assigns and the Buyer accepts an assignment of all the Seller's rights under, benefit of and interests in and assumes the burden of the Third Party Agreements in accordance with this clause 6.
  • This SPA does not constitute an assignment or an attempted assignment of a Third Party Agreement if an assignment or attempted assignment requires the consent of the counterparty to the Third Party Agreement and would constitute a breach of that Third Party Agreement if an assignment were made without that consent.

6.3   Consent of a Third Party for Third Party Agreement Transfer

If the consent of a third party is required for the transfer of a Third Party Agreement to the Buyer under clause 6.2 then:

  • the Seller and the Buyer must use their reasonable endeavours to obtain that consent by or as soon as reasonably practicable before Completion; and
  • if such consent cannot be obtained, then the Seller must terminate the Third Party Agreement and must use best endeavours to assist the Buyer to enter into a new agreement with the relevant third party on terms similar to those of the Third Party Agreement.

6.4 Post Completion Date

From the Completion Date until each Third Party Agreement to which clause 6.2 applies has been novated or effectively assigned to the Buyer:

  • the Buyer shall to the extent that it lawfully can, as a subcontractor to the Seller, perform at its expense all the obligations of the Seller to be performed under each such Third Party Agreement in respect of the period following Completion and the Seller shall account to the Buyer for any amounts paid in respect of that Third Party Agreement to the Seller after Completion; and
  • the Seller must, at the request and expense of and with the assistance of the Buyer, use its reasonable endeavours to perform any obligation of it under any Third Party Agreement which arises (or relates to the period) from Completion which the Buyer cannot lawfully assume, perform or observe.

6.5 Indemnity Between Seller and Buyer

Until such time as a Third Party Agreement is assigned and novated to a Buyer under this clause 6:

  • if the Buyer is performing the obligations of the Seller under the Third Party Agreement, then the Buyer will indemnify the Seller against any Loss which the Seller suffers as a result of a breach of the Third Party Agreement caused by the Buyer; and
  • the Seller will indemnify the Buyer against any breach of the Third Party Agreement caused by the Seller.

7. Transferring Intellectual Property Rights Owned by a Third Party

  • The Seller warrants that prior to supplying the Assets to the Buyer, the Seller has disclosed to the Buyer any Intellectual Property Rights in the Assets which may be held by a third party.
  • If the Assets incorporate the Intellectual Property Rights of a third party, then:
    1. the Seller warrants that it has obtained a licence from the relevant third party to incorporate the Intellectual Property Rights of that third party in the Assets ("Third Party Licence");
    2. if the Third Party Licence is capable of assignment to the Buyer, then the Seller will transfer that Third Party Licence pursuant to clause 6;
    3. if the Third Party Licence is not capable of assignment to the Buyer, then:
      • the Seller must disclose this fact to the Buyer prior to the parties entering into this SPA;
      • the Seller warrants that the Buyer may obtain a Third Party Licence in its own name; and
      • prior to Completion, the Seller must provide the Buyer with details of where to obtain the Third Party Licence in its own name and the cost of doing so; and
    4. the Seller warrants that unless expressly stated to the contrary by the Seller in its Listing, the Third Party Licence provides the Buyer with a worldwide, royalty free, perpetual right to display, distribute and reproduce (in any form) the Intellectual Property Rights of the third party contained in the Venture.
  • The Seller hereby indemnifies and keeps indemnified the Buyer, CrowdMnA and its officers, directors, agents, affiliates, employees, professional advisers and Third Party Providers ("Indemnified Parties") against any Loss which the Indemnified Parties may suffer or incur as a result of a breach by the Seller of any of the provisions of this clause 7.

8. Trading Responsibilities

8.1  Profits and Losses

  • Subject to Completion occurring, all revenues, profits and losses relating to the conduct of the Venture:
    1. in the period up to and including the Completion Date, belong to the Seller; and
    2. in the period from the Completion Date, belong to the Buyer.
  • Any amounts received by the Seller after the Completion Date which are stated to belong to the Buyer pursuant to this clause will be promptly paid to the Buyer (and in any event within two Business Days following receipt).

8.2 Liabilities

  • Subject to Completion occurring:
    1. all liabilities relating to the Assets in the period up to and including the Completion Date, are the responsibility of the Seller and the Seller indemnifies the Buyer from and against those liabilities (irrespective of whether the liability arises before or after the Completion Date); and
    2. all liabilities relating to the Assets in the period from the Completion Date, are the responsibility of the Buyer and the Buyer indemnifies the Seller from and against those liabilities.
  • The Seller acknowledges that apart from where expressly provided in clauses 6, 7 and 8 the Buyer will not assume any liabilities in relation to the Assets.

9. Warranties

9.1  Warranties

The Seller represents and warrants to the Buyer that:

  • it is the owner of the Assets with full title guarantee and has the right to transfer the Assets to the Buyer, free from all Encumbrances;
  • as a result of this SPA and at Completion, the Buyer will receive full title guarantee to the Assets free from all Encumbrances;
  • the transfer of the Assets from the Seller to the Buyer will not cause the Buyer to breach any law;
  • it has disclosed in its Listing, all Third Party Agreements and all third party licences which it has entered into in relation to the Assets and which the Buyer will require to operate the Venture following Completion in the way the Venture was operated prior to Completion; and
  • apart from where expressly stated in its Listing, each of the Third Party Agreements and Third Party Licences described in its Listing may be novated and/or assigned to the Buyer pursuant to clauses 6 and 7.

9.2 Indemnity

The Seller indemnifies the Buyer against any Loss which the Buyer suffers or incurs as a result of a breach of a warranty contained in clause 9.1. Apart from a breach of clause 9.1(c):

  • this indemnity will however be limited to the value of the Purchase Price; and
  • any claim under this indemnity, or otherwise in respect of a breach of clause 9.1, will only be valid if made within 6 (six) months following the Completion Date.

Nothing in this SPA shall pass to the Buyer, or shall be construed as acceptance by the Buyer of, any liability, debt or other obligation of the Seller (whether accrued, absolute, contingent, known or unknown) for anything done or omitted to be done before or at Completion Date in the course of or in connection with the Assets, Third Party Agreements and/or Third Party Licenses and the Seller shall indemnify the Buyer against all Losses suffered or incurred by the Buyer arising out of or in connection with any such thing.

10. Liability of CrownMnA

  • The Seller and Buyer each acknowledge and agree:
    1. CrowdMnA and its officers, directors, agents, affiliates, employees, professional advisers and Third Party Providers are not parties to this SPA; and
    2. CrowdMnA and its officers, directors, agents, affiliates, employees, professional advisers and Third Party Providers shall each not be liable or responsible for any breach of this SPA by any party to this SPA.
  • Notwithstanding clause 10(a), the Buyer and Seller each agree to indemnify CrowdMnA and its officers, directors, agents, affiliates, employees, professional advisers and Third Party Providers ("Indemnified") and hold us and (as applicable) our officers, directors, agents, affiliates, employees, professional advisers and Third Party Providers harmless from and against any third party claims, demands, losses, expenses, damages, liabilities and costs (including, without limitation, legal costs and court costs on a full indemnity basis) which any of the Indemnified suffer or incur due to, arising out of or related to this SPA.

11. Value Added Tax

  • The Seller and the Buyer agree to use all reasonable endeavours to secure that the sale is treated as neither a supply of goods nor a supply of services for VAT purposes.
  • If HMRC, at any time, determines in writing that VAT is payable on the sale of all or some of the Assets, the Seller shall promptly deliver to the Buyer a copy of that written determination and a proper VAT invoice in respect of the VAT payable and the Buyer shall within ten (10) Business Days of the receipt of such determination and VAT invoice pay to the Seller a sum equal to the amount of VAT determined by HMRC to be chargeable.

12. Confidentiality

Except to the extent required by law or any legal or regulatory authority of competent jurisdiction neither party shall at any time disclose to any person (other than its directors, employees or professional advisers all solely in relation to the sale of the Assets of the Venture) the terms of this SPA or any trade secret or other confidential information relating to the Assets or the other party, or make any use of such information other than to the extent necessary for the purpose of exercising or performing its rights and obligations under this SPA.

13. Further Assurance

Following the Completion Date, the Seller shall (at its own expense) promptly execute and deliver such documents, perform such acts and do such things as the Buyer may reasonably require from time to time for the purpose of giving full effect to this SPA.

14. Assignment

Neither party shall assign, transfer, mortgage, charge, declare a trust of, or deal in any other manner with any of its rights and obligations under this SPA without the prior written consent of the other party.

15. Inconsistency of Agreements

To the extent that there is any inconsistency between the terms of this SPA, any other agreement between you and a Buyer or Seller, and CrowdMnA’s Terms and Conditions and Site Rules, then those documents will be read in the following order of precedence:

  • first, CrowdMnA’s Terms and Conditions and Site Rules will take precedence over all other documents; and
  • second, any separate agreement between you and a Buyer or Seller will take precedence over this SPA apart from clause 10 of this SPA which will take precedence over that separate agreement.

Should the Seller and Buyer elect to use this SPA then this SPA together with the documents referred to in it and CrowdMnA’s Terms and Conditions and Site Rules constitute the entire agreement between the parties and supersedes and extinguishes all previous discussions, correspondence, negotiations, drafts, agreements, promises, assurances, warranties, representations and understandings between them, whether written or oral, relating to its subject matter.

16. Variation and Waiver

No variation of this SPA shall be effective unless it is in writing and signed by the parties (or their authorised representatives).

No failure or delay by a party to exercise any right or remedy provided under this SPA or by law shall constitute a waiver of that or any other right or remedy, nor shall it prevent or restrict the further exercise of that or any other right or remedy. No single or partial exercise of such right or remedy shall prevent or restrict the further exercise of that or any other right or remedy. A waiver of any right or remedy under this SPA or by law is only effective if it is in writing.

Except as expressly provided in this SPA, the rights and remedies provided under this SPA are in addition to, and not exclusive of, any rights or remedies provided by law.

17. Costs

Except as expressly provided in this SPA, each party shall pay its own costs and expenses incurred in connection with the negotiation, preparation and execution of this SPA (and any documents referred to in it).

18. Notices

A notice given to a party under or in connection with this SPA shall be in writing and shall be sent by electronic mail (email) or delivered by hand or sent by pre-paid first-class post, recorded delivery or special delivery in each case to that party's registered office.

Delivery of a notice is deemed to have taken place (provided that all other requirements in this clause 18 have been satisfied) if sent by electronic mail (email) 24 hours after sending, or if delivered by hand, at the time the notice is left at the address, or if sent by post on the second Business Day after posting, unless such deemed receipt would occur outside business hours (meaning 9.00am to 5.30pm Monday to Friday on a day that is not a public holiday in the place of deemed receipt), in which case deemed receipt will occur when business next starts in the place of receipt (and all references to time are to local time in the place of receipt).

This clause 18 does not apply to the service of any proceedings or other documents in any legal action.

19. Severance

If any provision or part-provision of this SPA is or becomes invalid, illegal or unenforceable, it shall be deemed modified to the minimum extent necessary to make it valid, legal and enforceable. If such modification is not possible, the relevant provision or part-provision shall be deemed deleted. Any modification to or deletion of a provision or part-provision under this clause shall not affect the validity and enforceability of the rest of this SPA.

20. Governing Law and Jurisdiction

This SPA and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of England and Wales. Each party irrevocably agrees that the courts of England and Wales shall have exclusive jurisdiction to settle any dispute or claim arising out of or in connection with this SPA or its subject matter or formation (including non-contractual disputes or claims).

This SPA has been entered into on the Effective Date.