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How To Investigate Any Business Opportunity
shall use its best efforts to keep available to the Buyer the services of its present employees and to pre-
serve the goodwill of the Seller's suppliers, customers and others having business relations with it.
(b) The Seller shall keep and maintain an accurate record of all items of inventory sold in the ordinary
course of business from January 31, XXX6 up until the date of closing. Such record shall be the basis
for adjustment of the purchase price as provided in paragraph 4.
(c) The Seller shall give the Buyer or his representative full access during normal business hours to the
business premises, records and properties, and shall furnish the Buyer with such information concerning
operation of the business as the Buyer may reasonably request.
(d) The Seller shall deliver to the Buyer's attorney for examination and approval prior to closing such bills
of sale and instruments of assignment as in the opinion of the Buyer's attorney shall be necessary to
vest in the Buyer good and marketable title to the business, assets and goodwill of the Seller.
8. Risk of loss. The Seller assumes all risk of destruction, loss or damage due to fire or other casualty
up to the date of closing. If any destruction, loss or damage occurs and is such that the business of the
Seller is interrupted, curtailed or otherwise materially affected, the Buyer shall have the right to terminate
this agreement. In such event, the escrow agent shall return to the Buyer the purchase money held by
him. If any destruction, loss or damage occurs which does not interrupt, curtail or otherwise materially
affect the business, the purchase price shall be adjusted at the closing to reflect such destruction, loss
or damage.
(Paragraphs 7 and 8 are concerned with the period between contracting and actual transfer of owner-
ship. The provisions stated anticipate such risks as depletion of inventory, injury to goodwill, creditors'
actions, and casualty loss. In 7(c), the disruptive effect of a transfer of ownership is reduced by providing
the buyer with the opportunity to become familiar with the details of the business operation before he as-
sumes the responsibility of operation.)
9. Covenant not to compete. The Seller covenants to and with the Buyer, his successors and assigns,
that for a period of five years from and after the closing he will not, directly or indirectly, either as princi-
pal, agent, manager, employee, owner, partner, stockholder, director or officer of a corporation, or other-
wise, engage in any business similar to or in competition with the business hereby sold, within a fifty
mile radius of Central City.
(Paragraph 9 anticipates the possibility that the buyer would suffer a loss of the business goodwill he
has purchased if the seller opened a similar business in competition with the buyer. Such provisions are
enforceable if the restriction is reasonable. What is considered reasonable will depend on the circum-
stances of each case. )
10. Conditions precedent to closing. The Buyer's obligations at closing are subject to the fulfillment
prior to or at closing of the following conditions :
(a) All of the Seller's representations and warranties contained in this agreement shall be true as of the