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Updated October 26, 2023
A website purchase agreement is a legal document between a buyer and a seller that details the sale and transfer of ownership of a website and its related assets. The sale typically includes multiple assets like one or multiple domains, email lists, and social media accounts, and it requires a domain ownership transfer.
Table of Contents |
What is Included in the Sale?
When selling a website, the seller usually hands off more than one asset, including:
- Domain(s) ownership transfer
- CMS credentials (Commonly WordPress or Shopify)
- Social Media accounts
- Email accounts and lists
- Intellectual property: logos, trademarks, and more
Sample Terms
Closing Costs
In some cases, a website broker helps to facilitate the closing, and there could be broker and listing costs associated with the sale of a website. It’s written into the contract whether the buyer, seller, or both parties are responsible for closing costs. Buyers and sellers may also choose to facilitate their own agreement and closing date without a broker.
Continued Support
A common clause in website purchase agreements — but uncommon to other agreements — is continued support after transfer. When a buyer acquires a website, oftentimes the seller will give the buyer 30 days of reasonable technical support to help the buyer get used to the new website or new Content Management System.
Due Diligence
Buyers may be given a set amount of time for due diligence and inspection of the website and its profit and loss statements. Sellers may be asked to grant access to the Seller’s Google Analytics account so that buyers may verify traffic or other metrics.
Where to List Websites
There are a number of marketplaces from which to purchase websites and related assets, with Flippa holding the highest number of listings.
How is the Sale of a Website Taxed?
Sellers that own a website asset for more than one year are taxed according to long-term capital gains rules. Sellers that own a website asset for less than 1 year are subject to normal income tax rates.
- Long-term capital gains (Federal): 15-20%
- Long-term capital gains (State): State income tax rate
- Short-term capital gains (Federal): Federal income tax rate
- Short-term capital gains (State): State income tax rate
(Refer to IRS: Capital Gains and Losses)
Difference Between Domain and Website Purchase
A domain purchase is different from a website purchase. When websites are purchased, the sale includes one or multiple domains and the website asset, but when a domain is purchased, usually through sites like GoDaddy or BlueHost, the domain owner uses a Content Management System (CMS) like WordPress, Shopify or Squarespace to design a website and connect their domain.
Sample Contract
Download: PDF, MS Word, OpenDocument
WEBSITE PURCHASE AGREEMENT
I. THE PARTIES. This Website Purchase Agreement (“Agreement”), made on [DATE] between the following parties:
Buyer: [BUYER’S NAME] with a mailing address of [ADDRESS] (“Buyer”), and
Seller: [SELLER’S NAME] with a mailing address of [ADDRESS] (“Seller”).
Buyer and Seller are each referred to herein as a “Party” and, collectively, as the “Parties.” The Website means hosting credentials, associated domains, the CMS (Content Management System), and all Related Assets included as part of this agreement, and is referred to herein as “Asset(s).”
II. RELATED ASSETS. As part of this Agreement, the Related Assets will also be transferred to the seller in full:
☐ – Social Media Accounts (list): [SOCIAL ACCOUNTS]
☐ – Email Lists
☐ – Trademarks
☐ – Logos
☐ – Other: [LIST]
III. PURCHASE PRICE. The purchase price of the Website and Related Assets is $[PRICE] (“Purchase Price”).
IV. DEPOSIT. As part of this Agreement, an initial payment is: (check one)
☐ – Not Required.
☐ – Required in the amount of $[AMOUNT] (“Deposit”).
The Deposit shall be: (check one)
☐ – Non-Refundable except in the case of Section XVI(b).
☐ – Refundable within the Inspection Period mentioned in Section VI or in the case of Section XVI(b).
V. PAYMENT. The Purchase Price shall be paid: (check one)
☐ – At Closing, less any Deposit paid in Section V.
☐ – By Owner Financing provided by the Seller in accordance with the following payment structure:
a.) Down Payment (at Closing): $[AMOUNT].
b.) Interest Rate: [RATE]%
c.) Term: [NUMBER OF MONTHS OR YEARS] ☐ Month(s) ☐ Year(s)
d.) Payment Due: On the [DAY] of every month.
VI. FINANCING. This Agreement is: (check one)
☐ – Not Contingent on the Buyer obtaining financing.
☐ – Contingent on the Buyer’s ability to obtain financing from a 3rd party.
☐ – Contingent on the Buyer’s ability to obtain financing from the Seller.
VII. APPROVAL OF 3RD PARTY. For the Assets to be sold, there is: (check one)
☐ – No Requirement for consent or approval from any 3rd party.
☐ – Requirement for consent or approval to sell the Assets by the following: [3RD PARTY DETAILS]
VIII. INSPECTION. The Parties agree that there: (check one)
☐ – SHALL BE an Inspection Period. The Buyer shall have a period of [NUMBER OF DAYS] day(s) to review the Assets and shall have the option to terminate this Agreement for any reason.
☐ – SHALL NOT be an Inspection Period.
IX. TRANSITION SUPPORT. The Seller:
☐ – WILL offer reasonable transition support for a period of [NUMBER OF DAYS] days after closing as described: [DESCRIBE]
☐ – WILL NOT offer transition support.
X. CLOSING. This transaction shall be closed on [DATE] at [TIME] ☐ AM ☐ PM or earlier at an agreed upon location by the Parties. (“Closing”).
XI. CLOSING COSTS. All costs associated with the Closing shall be the responsibility of: (check one)
☐ – Both Parties bear their own expenses.
☐ – Buyer
☐ – Seller
XII. SELLER’S REPRESENTATIONS. The Seller covenants and represents the following:
a.) Fiduciary Duty.
b.) Rights and Ownership.
c.) Outstanding Liabilities.
d.) Taxes.
e.) Insurance.
f.) Outstanding Suits.
XIII. PARTIES’ REPRESENTATIONS. The Parties represent and agree to the following:
a.) Compliance with Agreement.
b.) Injunction.
c.) Buyer’s Approval.
d.) Casualty.
e.) Adverse Change.
XIV. SELLER’S INDEMNIFICATION. The Seller agrees to jointly and severally indemnify and hold the Buyer, and assigns, harmless from any and all claims of any nature whatsoever, including without limitation:
a.) Claims.
b.) Taxes.
XV. ACCESS TO INFORMATION. After the execution of this Agreement, the Buyer shall have full access to any and all information in reference to the Assets.
XVI. TRANSFER OF ASSETS. The Seller makes the following covenants to the Buyer:
a.) Title.
b.) Period Until Closing.
XVII. RETURN OF MATERIALS. Any information that is obtained by the Buyer through the Seller shall be returned if there is no Closing.
XVIII. CONFIDENTIALITY. All negotiations regarding the Assets between the Buyer and Seller shall be confidential and not to be disclosed with anyone other than the respective advisors and internal staff of the Parties and necessary third (3rd) parties.
XIX. GOVERNING LAW. This Letter of Intent shall be governed under the laws by the State of [STATE].
XX. SEVERABILITY. In case any provision or wording in this Letter of Intent shall be held invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
XXI. ENTIRE AGREEMENT. This Agreement contains all the terms agreed to by the parties relating to its subject matter including any attachments or addendums. This Agreement replaces all previous discussions, understandings, and oral agreements.
Seller’s Signature: ____________________________ Date: _____________
Buyer’s Signature: ____________________________ Date: _____________