If a company is sold but the purchaser does not want to take the risks associated with shares, the assets (and liabilities) of a company are often sold instead. The contract that is drawn up for this purpose is an Asset Purchase Agreement (APA). An APA is also used when, for example, a part of a business is sold but (the share capital of) the entire enterprise is not.
Like the SPA, the APA is often the result of a tough negotiation process and is preceded by a DD investigation. Which assets are purchased, what condition they are in and what happens if the warranties are violated is regulated in the APA. In asset transactions, regulations regarding transfer of undertaking often play a role. These regulations determine whether, by operation of law, personnel will (automatically) be transferred together with the assets.