to me, this sounds so simple that i wonder why we need an “asset purchase agreement” with all the boilerplate clauses that lawyers add. a: in my may 21 column, i explained why seemingly simple earnout formulas can lead to disputes unless the agreement covers all elements of an earnout, including the definition or kinds of revenue or sales to which the percentages apply, the client base, the method or timing of recognition of revenue or sales, the measurement period of months or years and the frequency of payment. in addition, there are very important legal considerations when you buy a company’s assets, and the agreement must take these into account. first, you need to know who the seller’s owners are and whether they need to consent to the asset sale. if there are multiple owners, the number of owners who must consent depends on the law of the state under which the agency was set up and on any owners’ agreement, such as a stockholders’ agreement, partnership agreement or llc operating agreement. in addition, your agreement may require the signatures of most or even all of the owners, and in some cases, you will also need copies of minutes of stockholders’ and board of directors’ meetings authorizing the sale.

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