Document type: Toolkit Practice area: Business and Corporate — Mergers and Acquisitions Jurisdiction: United States Last reviewed: 5 September 2026
1. The liability matrix
The most useful document in a structuring exercise. Build it in week two and update it weekly.
LIABILITY MATRIX — [Target] Updated: ______
# | Liability | Est. | Structure | Non-structural | Residual | Cost
--|-----------|------|-----------|----------------|----------|------
1 | Ellisburgh soil/GW contamination
| $6.8M | Lease, not buy — avoids current-owner CERCLA
| $7.5M escrow on milestones; PLL policy $10M/20yr
| Operator exposure; overrun above policy | $410K premium
--|-----------
2 | Multiemployer withdrawal, 210 employees
| $14.2M | § 4204 exception — no withdrawal on sale
| $2.4M bond; seller secondary 5 yrs; $3M escrow 6 yrs
| Federal successorship claim notwithstanding § 4204
| $4.0M price reduction
--|-----------
3 | Ballast fire product claims 2001-2009
| $3.1M reserves | Asset deal; pre-closing products excluded
| Seller occurrence policies preserved; 6-yr tail on
claims-made layer; $5M escrow; product line re-engineered
| Product line / continuity-of-enterprise states
| $180K tail
--|-----------
4 | Sales tax on installation services, 6 states
| $2.3M | None — successor statutes apply
| Bulk sales notices; $3.1M holdback pending certificates;
dollar-one uncapped indemnity
| Assessment above holdback | $60K compliance
--|-----------
5 | Installer classification, 40 workers
| $1.8M | None — federal successorship
| $2.5M special indemnity, 4 yrs, $1.25M escrowed;
convert at closing to stop accrual
| Pre-closing periods above cap | —
--|-----------
6 | WARN, Farrow consolidation, 190 employees
| $2.4M | None — buyer's own decision
| Seller issues notice 65 days pre-closing at buyer's
direction, buyer indemnifies
| State mini-WARN severance | $2.4M payroll
--------------------------------------------------------------
TOTAL IDENTIFIED: $30.6M TOTAL PROTECTED: $27.4M
RESIDUAL AFTER STRUCTURE AND PROTECTIONS: ~$3.2M
PRICE IMPACT: -$5.2M
Drafting notes.
The "Residual" column is the point. It forces the team to state what is left after the structure and the protections, which is the number the client actually needs.
The "Structure" column will say "None" more often than people expect. CERCLA current-owner liability, WARN, labor successorship, and state tax successor statutes are unaffected by choosing an asset deal. Seeing that in writing changes the conversation.
Update weekly and circulate. Deal teams that maintain this document make better structuring decisions than teams that discuss structure in the abstract.
2. Assumed and excluded liabilities
2.3 ASSUMED LIABILITIES. At the Closing, Buyer shall assume and
agree to discharge only the following Liabilities of Seller
(the "Assumed Liabilities"), and no others:
(a) all Liabilities arising after the Closing under the
Contracts listed on Schedule 2.3(a), but only to the extent
such Liabilities (i) arise after the Closing, (ii) do not
arise from any breach or default occurring on or before the
Closing, and (iii) are ascertainable solely by reference to
the express terms of such Contracts;
(b) accounts payable of the Business incurred in the ordinary
course and reflected on the Closing Statement, in an
aggregate amount not to exceed $[__];
(c) accrued vacation and paid time off for Transferred
Employees, as reflected on the Closing Statement;
(d) Liabilities for the ordinary-course performance of open
purchase orders listed on Schedule 2.3(d); and
(e) the specific Liabilities listed on Schedule 2.3(e), in the
amounts stated thereon.
2.4 EXCLUDED LIABILITIES. Buyer does not assume, and Seller
shall retain and discharge, all Liabilities of Seller other than
the Assumed Liabilities (the "Excluded Liabilities"), including
without limitation:
(a) all Liabilities arising from or relating to the operation of
the Business or the ownership or use of the Assets on or
before the Closing;
(b) all Liabilities arising from or relating to any product
designed, manufactured, sold, distributed, installed, or
serviced by Seller or any predecessor on or before the
Closing, including any claim for personal injury, property
damage, warranty, recall, or breach of warranty, whether
such claim is asserted before or after the Closing;
(c) all Environmental Liabilities arising from or relating to
(i) any condition existing at, on, or under any property on
or before the Closing, (ii) any Release occurring on or
before the Closing, or (iii) the off-site transportation,
treatment, storage, or disposal of any Hazardous Substance
by or for Seller on or before the Closing;
(d) all Liabilities relating to any Benefit Plan, including any
withdrawal liability under Title IV of ERISA;
(e) all Liabilities for Taxes of Seller or relating to the
Business or the Assets for any Pre-Closing Tax Period,
including any Liability arising under any bulk sales or
successor liability provision of applicable Tax law;
(f) all Liabilities relating to any Person who is or was an
employee, officer, director, or independent contractor of
Seller, arising from events or conditions on or before the
Closing, including wages, benefits, worker classification,
discrimination, and workers' compensation;
(g) all Liabilities under the WARN Act or any state equivalent
arising from any event occurring on or before the Closing;
(h) all Indebtedness and all Transaction Expenses;
(i) all Liabilities relating to the Excluded Assets;
(j) all Liabilities identified on Schedule 2.4(j); and
(k) all Liabilities of Seller under this Agreement.
2.5 NO IMPLIED ASSUMPTION. No action taken by Buyer, including
the payment of any amount, the continuation of any relationship,
or the servicing of any customer, shall constitute or be
construed as an assumption of any Excluded Liability, and Buyer
expressly disclaims any such assumption.
Drafting notes.
Section 2.3's "and no others" plus the closed list is what makes the schedule work. A general assumption of "the ordinary course liabilities of the Business" is close to no protection at all.
Section 2.4(b)'s "whether such claim is asserted before or after the Closing" matters, because product claims surface years later and the argument that a post-closing claim is a post-closing liability is one buyers hear.
Section 2.4(c)(iii) catches arranger liability for off-site disposal, which buyers routinely forget and which is not addressed by not acquiring the property.
Section 2.5 is the answer to implied assumption, and it is only as good as the buyer's conduct — see the post-closing memorandum below.
Note what this does not do. It does not affect CERCLA current-owner liability, WARN based on the buyer's own decisions, labor successorship, or state tax successor statutes. Those need the other tools in this toolkit.
3. Assignment and assumption agreement
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement is made as of [date] by
and between [Seller] and [Buyer], under the Asset Purchase
Agreement dated [date] (the "Purchase Agreement"). Capitalized
terms have the meanings given in the Purchase Agreement.
1. ASSIGNMENT. Seller assigns, transfers, and conveys to Buyer
all of Seller's right, title, and interest in and to the
Contracts and other Assets listed on Exhibit A.
2. ASSUMPTION. Buyer assumes and agrees to discharge, from and
after the Closing, only the Assumed Liabilities as defined in
Section 2.3 of the Purchase Agreement.
3. NO OTHER ASSUMPTION. Buyer does not assume, and nothing
herein shall be construed as an assumption of, any Excluded
Liability. Section 2.4 and Section 2.5 of the Purchase Agreement
govern.
4. NON-ASSIGNABLE ASSETS. To the extent any Contract listed on
Exhibit A may not be assigned without a consent that has not
been obtained as of the Closing, this Agreement shall not
constitute an assignment thereof, and Sections [__] of the
Purchase Agreement (Non-Assignable Assets) shall govern.
5. NO THIRD-PARTY BENEFICIARIES. Nothing herein confers any
right on any Person other than the parties.
6. CONFLICT. In the event of any conflict between this Agreement
and the Purchase Agreement, the Purchase Agreement controls.
Drafting notes.
Section 6 is important. Closing documents are frequently drafted by junior lawyers from forms, and a broad assumption in a bill of sale can be argued to expand the purchase agreement's carefully negotiated schedule. The conflict provision closes that.
Section 5 prevents a third-party claimant from arguing the assignment created rights in its favor.
Use separate documents for each asset category — a bill of sale for tangible personal property, an IP assignment, a real property deed or lease, this agreement for contracts. The record should show precisely what transferred.
4. Consent request letter
[Date]
[Counterparty]
Attn: [Contract administrator]
Re: [Agreement] dated [date] between [Seller] and [Counterparty]
— Request for Consent to Assignment
Dear [__]:
[Seller] has entered into an agreement to sell substantially all
of the assets of its [Business] to [Buyer], a [description:
size, industry standing, financial capacity]. The transaction is
expected to close on or about [date].
Section [__] of the referenced Agreement requires your consent
to assignment. We are writing to request that consent.
WHAT WILL CHANGE. Following the closing, [Buyer] will perform
the Agreement in accordance with its terms. [Describe
continuity: the same personnel serving the account, the same
facilities, the same service levels.]
WHAT WILL NOT CHANGE. The pricing, terms, service levels, and
points of contact under the Agreement will remain as they are.
BUYER'S CAPACITY. [Buyer] is [description], with [relevant
financial or operational information]. [Attach financial
information or a parent guarantee if helpful.]
We would be glad to arrange a call with [Buyer]'s [relevant
executive] to answer questions.
Please indicate your consent by signing below and returning by
[date]. Please note that this letter and its contents are
confidential and subject to Section [__] of the Agreement.
Sincerely,
CONSENT: The undersigned consents to the assignment of the
Agreement to [Buyer], effective as of the closing, and confirms
that (i) the Agreement is in full force and effect, (ii) no
default exists, and (iii) no amounts are past due other than as
listed below.
________________________ Date: __________
Drafting notes.
The estoppel language in the consent block — in force, no default, nothing past due — turns a consent into a diligence confirmation and costs nothing to include.
"What will not change" is the paragraph counterparties read. Most consent refusals are about fear of disruption, not about the buyer.
Sequence matters. Approach the largest counterparties first, in person or by phone before the letter, and have the buyer's operating executive available. A consent request that arrives cold, by mail, from a lawyer, gets a slow answer or none.
For consents that will not come, the fallback provisions in the purchase agreement should provide that the seller holds the contract for the buyer's benefit, remits the economics, and the buyer performs as subcontractor — while recognizing that this arrangement may itself breach the contract.
5. Environmental provisions
Lease instead of purchase, where the exposure is in the land:
[LEASE] Section [__] — Environmental Allocation.
(a) Landlord retains full responsibility for, and shall
indemnify Tenant against, all Environmental Liabilities arising
from any condition existing at, on, or under the Premises as of
the Commencement Date, including the Known Conditions described
on Exhibit [__], and shall complete the Approved Remediation
Plan at its sole cost.
(b) Tenant shall be responsible for Environmental Liabilities
arising from Tenant's own Release of Hazardous Substances at the
Premises after the Commencement Date.
(c) A baseline environmental assessment dated [date] is attached
as Exhibit [__] and shall be conclusive evidence of the
condition of the Premises as of the Commencement Date.
(d) Landlord shall maintain the Environmental Escrow in
accordance with the Escrow Agreement and shall not seek release
of any portion except upon certification of the corresponding
Milestone by [the State agency / the Licensed Site
Professional].
(e) Tenant shall have the right, but not the obligation, upon
Landlord's failure to perform, to undertake the Approved
Remediation Plan and to draw upon the Environmental Escrow and
to offset costs against Rent.
(f) Landlord shall maintain the Pollution Legal Liability policy
described on Exhibit [__] naming Tenant as an additional
insured, for the term of this Lease.
Drafting notes.
Subsection (c)'s baseline assessment is the single most valuable environmental provision in a lease. Without it, every future finding is an argument about when the contamination arrived.
Subsection (e) gives the tenant self-help, which converts an indemnity into something it can actually use.
And be clear about what the lease does and does not do. It avoids current-owner liability under CERCLA § 107. It does not avoid operator liability, so the tenant's own operations matter — see United States v. Bestfoods, 524 U.S. 51 (1998) on the operator standard.
Escrow release on milestones:
Milestone 1 — Remedial Action Workplan approved Release 15%
Milestone 2 — Source removal complete, confirmed Release 20%
Milestone 3 — Two consecutive years of monitoring
results below applicable standards Release 25%
Milestone 4 — No Further Action letter issued Release 40%
Each release requires a certificate from the Licensed Site
Professional and 20 days' notice to Buyer, during which Buyer
may object on the ground that the Milestone has not been met.
6. ERISA Section 4204 provisions
Section [__] — Multiemployer Plan.
(a) Buyer shall, from and after the Closing, contribute to the
[Plan] with respect to the operations acquired hereunder for
substantially the same number of contribution base units for
which Seller had an obligation to contribute, all within the
meaning of ERISA § 4204(a)(1)(A).
(b) Buyer shall, prior to the Closing, obtain and maintain for a
period of five plan years commencing with the first plan year
beginning after the Closing, a bond or escrow in an amount equal
to the greater of (i) the average annual contribution required
to be made by Seller to the Plan for the three plan years
preceding the Closing, or (ii) the annual contribution that
Seller was required to make for the last plan year before the
Closing, all within the meaning of ERISA § 4204(a)(1)(B).
(c) If Buyer withdraws from the Plan in a complete withdrawal,
or a partial withdrawal with respect to the operations acquired
hereunder, during the first five plan years beginning after the
Closing, Seller shall be secondarily liable for any withdrawal
liability Seller would have had to the Plan but for ERISA
§ 4204, to the extent Buyer does not pay, all within the meaning
of ERISA § 4204(a)(1)(C).
(d) The parties shall jointly notify the Plan of this
transaction and shall cooperate in obtaining any required
determination or waiver.
(e) Seller shall indemnify Buyer against any withdrawal
liability asserted against Buyer with respect to any period
before the Closing, or arising from any determination that this
transaction did not satisfy ERISA § 4204, without regard to the
Basket or the Cap and without limit as to amount, for a period
of [six] years, secured by the Pension Escrow.
Drafting notes.
Subsections (a) through (c) track § 4204's three statutory requirements and should follow the statutory language closely; deviation is where these fail.
Subsection (e) is the buyer's real protection, because § 4204 does not defeat a federal successorship claim where the buyer had notice and there is substantial continuity — and diligence creates notice.
Confirm the structure's purpose. ERISA § 4212(c) disregards transactions a principal purpose of which is to evade or avoid liability. A § 4204 structure entered for genuine commercial reasons is fine; one engineered solely to escape the assessment is not.
7. WARN allocation
Section [__] — WARN Act.
(a) Seller shall be responsible for all obligations under the
WARN Act and any state or local equivalent arising from any
"employment loss" (as defined therein) occurring on or before
the Closing Date.
(b) Buyer shall be responsible for all such obligations arising
from any employment loss occurring after the Closing Date.
(c) On Schedule [__], Seller has listed all employment losses at
each site of employment during the 90 days preceding the
Closing.
(d) At Buyer's written request delivered not later than [70]
days before the Closing, Seller shall issue WARN notices in a
form approved by Buyer with respect to employment losses Buyer
anticipates implementing after the Closing. Buyer shall
reimburse Seller for the reasonable costs of such notices and
shall indemnify Seller against any claim arising therefrom,
other than a claim arising from Seller's failure to issue the
notices as directed.
(e) Buyer shall offer employment to not fewer than [__] of
Seller's employees at each site of employment, on terms
sufficient to avoid an "employment loss," except as set forth
on Schedule [__].
Drafting notes.
Subsection (d) is the operative provision in any deal involving a post-closing consolidation. Notice given by the seller before closing, at the buyer's direction, is cheaper and cleaner than notice given by the buyer in its first week, and it avoids the argument that the buyer triggered WARN immediately on acquiring the business.
Subsection (c)'s 90-day lookback matters because employment losses aggregate over a rolling 90-day period; a seller's recent reduction plus the buyer's planned reduction can cross the threshold together.
Check state mini-WARN separately; thresholds are lower, notice periods longer, and several states add severance.
8. Tax clearance and holdback
Section [__] — Bulk Sales and Tax Clearance.
(a) Seller shall, not later than [__] days before the Closing,
file all notices required under the bulk sales, bulk transfer,
or successor liability provisions of the Tax laws of each
jurisdiction listed on Schedule [__], and shall provide Buyer
with copies and proof of filing.
(b) Seller shall apply for a tax clearance certificate (or
equivalent) from each such jurisdiction and shall use best
efforts to obtain each certificate as promptly as practicable.
(c) At the Closing, Buyer shall withhold from the Purchase Price
an amount equal to $[__] (the "Tax Holdback"), which shall be
[deposited with the Escrow Agent / retained by Buyer].
(d) Upon receipt of a clearance certificate from a jurisdiction
showing no unpaid Tax, or showing an amount that Seller has
paid, Buyer shall release from the Tax Holdback the amount
allocated to that jurisdiction on Schedule [__].
(e) If any jurisdiction assesses Tax against Buyer as a
successor, Buyer may satisfy the assessment from the Tax
Holdback and shall be indemnified by Seller for any excess,
without regard to the Basket or the Cap and without limit as to
amount, until [60] days after the expiration of the applicable
statute of limitations.
(f) Any portion of the Tax Holdback remaining [24] months after
the Closing, less amounts subject to pending assessments or
uncleared jurisdictions, shall be released to Seller.
Drafting notes.
This is mechanical and it is skipped constantly. State sales-and-use tax successor statutes impose liability on asset purchasers without regard to the excluded liabilities schedule, and the only reliable answer is a clearance certificate.
Allocate the holdback by jurisdiction on a schedule, so releases can happen as certificates arrive rather than all at the end.
Start at signing. Certificates take four weeks to six months.
9. Insurance covenants
Section [__] — Insurance.
(a) Seller shall not cancel, rescind, amend adversely, permit to
lapse, settle, release, or commute any Insurance Policy in
effect at any time before the Closing that provides coverage for
any Excluded Liability, without Buyer's prior written consent.
(b) Prior to the Closing, Seller shall purchase, at its expense,
an extended reporting period endorsement ("tail") of not less
than [six] years for each claims-made policy listed on Schedule
[__], and shall provide Buyer with evidence of binding.
(c) Seller shall deliver to Buyer at the Closing true and
complete copies (or, where unavailable, secondary evidence) of
all occurrence-based liability policies in effect at any time
during the period [__] to the Closing, together with all
available policy schedules, endorsements, and claims histories.
(d) Seller shall, upon Buyer's request, tender to the applicable
insurer any claim relating to an Excluded Liability, shall
cooperate in the prosecution of such claim, and shall remit to
Buyer any proceeds received to the extent they relate to a
Liability Buyer has borne.
(e) To the extent permitted, Seller shall cause Buyer to be
named as an additional insured under the policies listed on
Schedule [__].
Drafting notes.
Subsection (b)'s pre-closing deadline is essential. A tail must be purchased before the policy expires, and there is no second chance. This is the single most commonly missed item in the entire toolkit.
Subsection (c) is undervalued. Decades-old occurrence policies are assets and have funded eight-figure defense costs in latent-injury cases. Collect them; secondary evidence of coverage (invoices, ledgers, correspondence) is admissible in most jurisdictions where the policy itself is lost.
Subsection (d) matters because the seller controls the tender. A buyer bearing a loss covered by the seller's policy has no direct route to the carrier without this provision.
10. Section 363 sale order — findings to request
PROPOSED FINDINGS AND CONCLUSIONS
1. The Sale is free and clear of all liens, claims, encumbrances,
and other interests under 11 U.S.C. § 363(f), including
without limitation any claim, whether known or unknown,
asserted or unasserted, that Buyer is or may be liable as a
successor, transferee, or continuation of the Debtor,
including claims arising under: (a) any theory of successor
liability, de facto merger, mere continuation, continuity of
enterprise, or product line; (b) any product designed,
manufactured, sold, distributed, installed, or serviced by
the Debtor; (c) any employment, labor, wage, benefit, or
discrimination claim; (d) any tax; (e) ERISA, including
withdrawal liability; and (f) environmental laws, to the
extent such claims are monetary claims arising from
pre-Closing conduct.
2. Buyer is not, and shall not be deemed to be, a successor to
the Debtor, a continuation of the Debtor or its enterprise,
or a joint or single employer with the Debtor, for any
purpose.
3. Buyer is a good faith purchaser within the meaning of 11
U.S.C. § 363(m) and is entitled to the protections thereof.
4. The Purchase Price constitutes reasonably equivalent value
and fair consideration, and the Sale resulted from a
marketing process conducted in good faith and at arm's
length.
5. Notice of the Sale and of the deadline to object was
adequate, including publication notice in [publications], and
satisfied due process as to all known and unknown claimants.
6. The Court retains exclusive jurisdiction to interpret and
enforce this Order, including to enjoin any person from
asserting any claim released hereby against Buyer.
7. The contracts listed on Exhibit [__] are assumed and assigned
to Buyer under 11 U.S.C. § 365, with cure amounts as set
forth thereon, and any provision restricting assignment is
unenforceable.
Drafting notes.
Enumerate the categories. A generic "free and clear of successor liability" finding is worth less than one that names product line, continuity of enterprise, ERISA withdrawal, and the rest by name.
Build the record for finding 5. Publication notice, a claims bar date, and — where future claims are foreseeable — a claims representative and a channeling structure.
Understand the limits. A § 363 order does not eliminate the buyer's own current-owner liability under CERCLA for property it acquires, ongoing regulatory obligations, WARN based on the buyer's own post-closing decisions, or labor successorship arising from the buyer's own hiring.
Assumption under § 365 is one of the most valuable features of a bankruptcy sale: it overrides anti-assignment provisions that would otherwise require consent.
11. Solvency certificate
SOLVENCY CERTIFICATE
The undersigned, the [Chief Financial Officer] of [Seller],
certifies as of the Closing Date that, after giving effect to
the transactions contemplated by the Purchase Agreement and the
application of the proceeds:
1. The fair value of Seller's assets exceeds its debts and
liabilities, subordinated, contingent, or otherwise;
2. The present fair saleable value of Seller's assets is greater
than the amount required to pay its probable liability on its
debts as they become absolute and matured;
3. Seller will be able to pay its debts and liabilities as they
become due in the ordinary course;
4. Seller does not have unreasonably small capital with which to
conduct the business in which it is engaged;
5. Seller does not intend to, and does not believe it will,
incur debts beyond its ability to pay as they mature; and
6. Seller is not entering into the transactions with the intent
to hinder, delay, or defraud any creditor.
In making this certification, the undersigned has considered
[the retained liabilities schedule, the escrow arrangements, the
insurance in place, and the projected wind-down budget attached
hereto].
Drafting notes.
The six paragraphs track the Uniform Voidable Transactions Act's constructive fraud tests, which is the point.
The final paragraph matters. A certificate that recites conclusions without indicating what was considered is worth less than one that identifies the retained liabilities and the wind-down budget.
Where the deal is leveraged or the seller is stressed, get a third-party solvency opinion. The certificate is the officers' statement; the opinion is independent evidence.
12. Post-closing conduct memorandum
Circulate this to operations, finance, customer service, and HR on day one. It preserves the excluded liabilities schedule that the lawyers spent six weeks drafting.
MEMORANDUM — POST-CLOSING PRACTICES
To: [Operations, Finance, Customer Service, HR]
From: Legal
Re: [Acquired Business] — what we did and did not acquire
On [date] we purchased the assets of [Seller]. We did NOT
purchase its liabilities, with limited exceptions. How we behave
in the next twelve months affects whether that holds.
DO NOT, without checking with Legal first:
1. Pay any invoice for goods or services delivered before
[Closing Date]. Route these to [contact] at Seller.
2. Honor any warranty on a product manufactured before the
Closing. Route the customer to [contact] at Seller, using the
script at Attachment A.
3. Process any recall, safety notice, or field action relating
to pre-Closing product.
4. Respond to any claim, demand letter, or lawsuit relating to
pre-Closing conduct. Forward it to Legal the same day.
5. Continue any employee benefit plan of Seller, or represent to
any employee that a Seller plan continues.
6. Sign any document that refers to us as the "successor" to
Seller.
7. Use Seller's letterhead, invoices, purchase orders, terms of
sale, or warranty documents. Ours are at [location].
8. Represent to any customer or supplier that we "took over"
Seller or that "nothing has changed."
DO:
1. Use our entity name, our EIN, our payroll, our benefit plans,
and our customer-facing documents from day one.
2. Issue our own offer letters, on our terms, to employees we
hire.
3. Forward anything relating to pre-Closing periods to Legal.
4. Keep the environmental site controls and reporting practices
described at Attachment B; these are legal obligations and
lapsing on them costs us a defense.
5. Call Legal when in doubt. The question is free; the answer
later is not.
Attachment A: Customer script for pre-Closing warranty claims
Attachment B: Environmental site obligations
Attachment C: Contacts at Seller for routing
Drafting notes.
This document is the difference between a schedule that works and one that is argued about. Implied assumption is established by conduct, and the conduct is by people who never read the purchase agreement.
Attachment A matters more than it looks. Customer service representatives faced with an angry customer will fix the problem unless someone has given them an alternative. Give them a script and a routing contact.
Attachment B keeps the bona fide prospective purchaser defense alive. Appropriate care and cooperation are continuing obligations, and they are performed by facility staff, not by lawyers.
Re-circulate at six months. Turnover erodes it.
13. Quick reference — what each tool addresses
| Exposure | Structure | Escrow | Insurance | Clearance | Court order |
|---|---|---|---|---|---|
| Trade payables | ✔ | ✔ | — | — | ✔ |
| Contract liabilities | ✔ | ✔ | — | — | ✔ |
| Pre-closing litigation | ✔ (state-dependent) | ✔ | ✔ (seller's) | — | ✔ |
| Product liability | Partial | ✔ | ✔ (tails, occurrence) | — | ✔ (known claims) |
| CERCLA — property owner | Only by not owning | Partial | ✔ (PLL) | — | ✖ |
| CERCLA — monetary claims | Partial | ✔ | ✔ | — | ✔ |
| Multiemployer withdrawal | § 4204 only | ✔ | — | — | Partial |
| WARN | ✖ | ✔ (indemnity) | — | — | ✖ |
| Labor successorship | ✖ | — | — | — | ✖ |
| Employment claims | Partial | ✔ | ✔ (EPL tail) | — | ✔ |
| State sales/use tax | ✖ | ✔ | — | ✔ | ✔ |
| Fraudulent transfer | ✖ | — | — | — | ✔ |
Read the ✖ column. Those are the exposures no purchase agreement solves, and they are the ones buyers most often assume it does.
Related documents
- Asset Deals, Stock Deals, and Successor Liability: What Follows the Business and What Stays Behind
- Structuring an Acquisition to Manage Successor Liability: A Practical Guide
- Deal Structure and Successor Liability Checklist: A Practical Checklist
- Acquisition Agreement Toolkit: Reps, Schedules, Escrows, Earnouts, and Claim Notices
- Environmental Liability for Businesses and Property Owners: CERCLA, RCRA, and Diligence
- Bankruptcy and Creditors' Rights Toolkit
This toolkit is general information, not legal advice, and does not create an attorney-client relationship. Templates require adaptation by counsel to the jurisdictions involved and the diligence record.