Under LOI for a $12M manufacturing co. and in the process of drafting the purchase agreement (asset purchase). We have a great relationship (famous last words) with the sellers and there's almost zero changes from our LOI to the purchase agreement that we'd like to send.
I've started looking at Stanford's Search Fund Primer resources and came across the legal template exhibits (specifically Exhibit 17). To my (untrained) eye, it was great to get a sense of the contents and structure of an asset purchase agreement. It seems like Stanford is taking a Y-Combinator SAFE agreement approach where they try to provide lower-friction standardized legal agreements to better equip the search community.
For both searchers and lawyers here, what are your thoughts on the Stanford Search Fund Asset Purchase Agreement (Exhibit 17 of the 2024 Stanford Search Primer)? Has anyone actually used it and gotten a lawyer to revise from there? Did you use it as a nice textbook example to get a sense of key terms but not an actually usable starting point for a legal agreement? From my experience, most lawyers will say it's not worth / too risky to use someone else's template but I'm curious if that's actually the case here.
Any thoughts?
[LEGAL QUESTION] Is the Stanford Search Fund Asset Purchase Agreement any good?
by a searcher from London Business School
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The reason most lawyers don't want to use another firm's template is because it is less efficient. I know my own forms like the back of my hand, which makes them easy to revise in order to capture the specifics of a deal. I can't say the same is true of another lawyer's work. In effect, I have to reverse engineer the form to really get to grips with it.
You raise a good point about the NVCA model legal documents (used for startup financings). There is no equivalent in the M&A space. The closest we have is the ABA model transactions documents. I'm all for model forms, but we just don't have that consensus yet.