Purchase & sale agreement checklist

The deal

• Parties and structure. The right legal entities named, and share vs. asset clearly stated.
• Purchase price and adjustments. The number, plus working-capital and other adjustments that change it at closing.
• Payment terms. Cash, vendor take-back, earn-out, and any holdback or escrow, with timing and security.

Reps, warranties, indemnities

• Representations and warranties. The factual statements each side makes about the business — the seller's are usually the heavily negotiated part.
• Indemnities. Who pays, and how much, if a representation turns out to be wrong.
• Caps, baskets, survival. Limits on indemnity claims: a maximum, a minimum threshold, and how long claims can be brought.
• Holdback / escrow. Money set aside to cover claims for a period after closing.

Conditions and diligence

• Conditions to closing. What must be true or done before either side is obligated to close — financing, consents, no material change.
• Third-party consents. Landlord, lender, and key-contract approvals identified and pursued early.
• Due diligence outs. The buyer's right to walk (or re-price) if diligence turns up problems.

People and transition

• Employees. Who transfers, on what terms, and who bears termination costs.
• Non-competition and non-solicitation. The seller not competing or poaching after the sale, within reasonable limits.
• Transition and training. What the seller does after closing to hand the business over.

Closing and after

• Closing deliverables. The list of signed documents, certificates, and filings needed to close.
• Tax elections. Section 167 (HST), purchase price allocation, and other elections handled correctly.
• Post-closing covenants. Ongoing obligations after the deal — cooperation, further assurances, confidentiality.
• Dispute resolution. How disagreements after closing get resolved.