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Goodwill Purchase Agreement for the United Kingdom

Goodwill Purchase Agreement Template for England and Wales

A Goodwill Purchase Agreement under English and Welsh law is a legal document that facilitates the transfer of a business's intangible assets, including customer relationships, reputation, and brand value. The agreement details the terms of sale, purchase price, warranties, and any restrictions on the seller's future activities. It includes provisions for protecting the transferred goodwill and ensures compliance with relevant UK legislation, including tax implications and competition law considerations.

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Goodwill Purchase Agreement

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What is a Goodwill Purchase Agreement?

A Goodwill Purchase Agreement is essential when acquiring the intangible assets of a business in England and Wales. This document is typically used in business acquisitions where the buyer wishes to purchase the goodwill separately from other business assets. The agreement covers crucial elements such as valuation methodology, payment terms, warranties about the business's reputation and customer relationships, and often includes non-compete provisions to protect the purchased goodwill. It must comply with English law requirements and consider tax implications, particularly regarding VAT and capital gains.

What sections should be included in a Goodwill Purchase Agreement?

1. Parties: Identification and details of the buyer and seller

2. Background: Context of the transaction and description of the business goodwill

3. Definitions: Key terms used throughout the agreement including legal definitions and business-specific terminology

4. Sale and Purchase of Goodwill: Core transaction terms and scope of goodwill being transferred

5. Purchase Price: Consideration and payment terms including any deferred payments or adjustments

6. Completion: Transfer mechanics, timing and procedural requirements

7. Seller's Warranties: Standard warranties regarding ownership, right to sell, and business representations

8. Governing Law and Jurisdiction: Choice of law and dispute resolution provisions under English and Welsh law

What sections are optional to include in a Goodwill Purchase Agreement?

1. Non-Compete Provisions: Restrictions on seller's future business activities to protect the purchased goodwill

2. Employee Matters: Provisions dealing with transfer of employees and TUPE implications

3. Tax Covenant: Detailed provisions for allocation of tax liabilities between parties

4. Intellectual Property Rights: Specific provisions for transfer of associated IP rights and protection measures

What schedules should be included in a Goodwill Purchase Agreement?

1. Description of Business: Detailed description of business and goodwill components being transferred

2. Completion Obligations: Comprehensive list of actions and deliverables required at completion

3. Warranties: Full set of warranties given by seller regarding the business and goodwill

4. Intellectual Property Rights: Detailed schedule of IP rights included in the goodwill transfer

5. Excluded Assets: Specific list of assets and rights excluded from the goodwill transfer

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

England and Wales

Document Type

Purchase Agreement

Cost

Free to use
Relevant legal definitions



































Clauses




























Industries

Sale of Goods Act 1979: Although primarily focused on tangible goods, this Act contains principles that may be relevant to goodwill valuation and transfer in business sales

Companies Act 2006: Key legislation governing corporate transactions, including requirements for company authorizations and board approvals in goodwill sales

Partnership Act 1890: Crucial legislation when the goodwill being sold involves a partnership business, affecting rights and obligations of partners

Value Added Tax Act 1994: Addresses VAT implications and tax considerations in goodwill transfers

Enterprise Act 2002: Competition law legislation relevant when goodwill purchase could affect market competition

Competition Act 1998: Ensures the goodwill purchase doesn't create anti-competitive market conditions

Trade Marks Act 1994: Relevant for intellectual property aspects of goodwill, particularly regarding trademark rights transfer

Copyright, Designs and Patents Act 1988: Governs intellectual property rights that may be associated with the goodwill being transferred

Transfer of Undertakings (Protection of Employment) Regulations 2006: TUPE regulations protecting employee rights when business ownership changes through goodwill purchase

Common Law Contract Principles: Fundamental principles including offer, acceptance, consideration, privity, misrepresentation, and duty of disclosure

Tax Legislation Framework: Various Finance Acts governing Capital Gains Tax and Corporation Tax implications of goodwill transfers

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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