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Contract Assignment Agreement

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This Contract Assignment Agreement document is used to transfer rights and responsibilities under an original contract from one Party, known as the Assignor, to another, known as the Assignee. The Assignor who was a Party to the original contract can use this document to assign their rights under the original contract to the Assignee, as well as delegating their duties under the original contract to that Assignee. For example, a nanny who as contracted with a family to watch their children but is no longer able to due to a move could assign their rights and responsibilities under the original service contract to a new childcare provider.

How to use this document

Prior to using this document, the original contract is consulted to be sure that an assignment is not prohibited and that any necessary permissions from the other Party to the original contract, known as the Obligor, have been obtained. Once this has been done, the document can be used. The Agreement contains important information such as the identities of all parties to the Agreement, the expiration date (if any) of the original contract, whether the original contract requires the Obligor's consent before assigning rights and, if so, the form of consent that the Assignor obtained and when, and which state's laws will govern the interpretation of the Agreement.

If the Agreement involves the transfer of land from one Party to another , the document will include information about where the property is located, as well as space for the document to be recorded in the county's official records, and a notary page customized for the land's location so that the document can be notarized.

Once the document has been completed, it is signed, dated, and copies are given to all concerned parties , including the Assignor, the Assignee, and the Obligor. If the Agreement concerns the transfer of land, the Agreement is then notarized and taken to be recorded so that there is an official record that the property was transferred.

Applicable law

The assignment of contracts that involve the provision of services is governed by common law in the " Second Restatement of Contracts " (the "Restatement"). The Restatement is a non-binding authority in all of U.S common law in the area of contracts and commercial transactions. Though the Restatement is non-binding, it is frequently cited by courts in explaining their reasoning in interpreting contractual disputes.

The assignment of contracts for sale of goods is governed by the Uniform Commercial Code (the "UCC") in § 2-209 Modification, Rescission and Waiver .

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Other names for the document:

Assignment Agreement, Assignment of Contract Agreement, Contract Assignment, Assignment of Contract Contract, Contract Transfer Agreement

Country: United States

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How Do You Draft an Assignment Clause?

By Shauna Ng Lawyer

Updated on November 24, 2022 Reading time: 5 minutes

This article meets our strict editorial principles. Our lawyers, experienced writers and legally trained editorial team put every effort into ensuring the information published on our website is accurate. We encourage you to seek independent legal advice. Learn more .

Why Should I Include an Assignment or Novation Clause?

• When Might You Use an Assignment or Novation? 

What Form Does an Assignment or Novation Clause Take?

What are the risks.

• Key Takeaways 

Frequently Asked Questions

An assignment clause allows for a transfer of rights, benefits and obligations under a contract from one party to another. It is important to note that the assignor can only transfer its benefits under the contract. They cannot transfer burdens, obligations or liabilities through an assignment. This means the assignor is not released from their obligations, including any liabilities, under the contract. The assignee does not become a party to the original contract but can enforce their right to receive the benefit that the assignor assigned to them. 

A novation clause is a clause that allows for the release of one party from a contract and their replacement with another party. Unlike an assignment clause, a novation clause allows for the transfer of liabilities but requires consent from all parties to the existing contract. 

This article sets out:

• what an assignment clause looks like; 
• when you may use one; and 
• why you may wish to use one. 

It also explains the risks involved with assignments in contractual relationships. 

Suppose you want to ensure that a third party possesses the right to enforce benefits under a contract. Assignment ensures that the third party can access the benefits under the contract. As mentioned earlier, assignment only applies to benefits in a contract and excludes liabilities. 

Consider a novation if you want to transfer benefits and liabilities under the contract. Novation allows the new party to step into your shoes and take over your interests and obligations, including any burdens or liabilities under the contract. In effect, novation equates to an exchange of one party for another party. 

It is important that an assignment or novation clause clearly defines who is allowed to assign or novate the agreement and the conditions on which this can be done. Similarly, suppose you wish to ensure that you continue to deal with the party you originally contracted with. In that case, you might include the option of terminating the contract in case of an attempt at assignment or novation. 

When Might You Use an Assignment or Novation? 

When purchasing a business, much of the value attributed to that business is in the quality of:

• the existing customer base; and
• established contractual relationships with suppliers. 

If you sell a business, you will likely want to finalise any existing debts or contractual obligations. 

By novating or transferring the contracts to a new party, the new party inherits your contractual relationships. This may include:

• contracts with suppliers and customers; 
• existing debts; and 
• outstanding contractual obligations. 

There are several ways to draft an assignment or novation clause, including where:

• the parties to the agreement may only assign and/or novate the agreement, wholly or partially, with written consent from the other party;
• neither party may assign and/or novate its rights under the agreement; or 
• the agreement binds the parties and their respective heirs, successors and assignees.

Assignment Clause Example

Assignment : A party must not assign, novate or otherwise deal with the whole or any part of its rights or obligations under this Agreement without the prior written consent of the other Party (such consent is not to be unreasonably withheld). 

The effect of the clause above is to limit a party’s ability to assign its rights or benefits under the agreement, or otherwise novate its rights and obligations, by requiring consent from the other party. 

In addition, you could include an option to terminate the contract if the other party attempts to assign its rights or substitute another party into the contract. Often, the nature of an assignment and novation clause will depend on your relationship with the other party. For example, in contractual relationships where one of the parties has the upper hand, assignment clauses might only prevent the weaker party from assigning and expressly permit the stronger party to assign its interests without requiring approval from the other party. 

Change of Control Clause 

You should also consider whether a change of control clause is required. A change of control clause anticipates a situation where there is a change in the ownership or control of a party to the contract. A well-drafted change of control clause should define the set of events that constitute a change of control, which may:

• trigger a certain set of events, such as termination; or
• be considered an assignment, triggering the same information and consent requirements necessary in an assignment situation. 

Why would you care about a change of ownership in the other party? There are several reasons why a change of ownership or control of the other party could be problematic, including where: 

• you have a close business relationship with the existing owners; 
• you are concerned about competitors or potential competitors owning the counterparty; or 
• you have internal policies or prescribed risk structures that determine which companies or group of companies you can contract with. 

If you do not have an effective novation or assignment clause, you risk ending up in a contract with an unknown party. The party you end up in a contract with could have different values and abilities than the party you initially contracted. This can negatively impact your business. 

However, it is important to consider the availability of assignment and novation from a prospective purchaser’s point of view. For example, not being able to assign your contracts with customers or supplies might decrease your business’s overall attractiveness and value to that buyer. 

Know which key terms to negotiate when buying a business to protect your interests and gain a favourable outcome.

Key Takeaways 

When entering into contracts, it is essential that your contract lawyer carefully considers any novation or assignment clauses. These clauses are important mechanisms that allow for the transfer of interest, obligations, rights and benefits within a contractual relationship. In some circumstances, they may increase the value and flexibility of your business. In other circumstances, however, they can pose the risk of losing control of the skillsets, values and abilities of the party you are contracting with. 

If you need help with an assignment clause, our experienced contract lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page .

An assignment clause allows for a transfer of rights, benefits and obligations under a contract from one party to another. 

A novation clause is a clause that allows for the release of one party from a contract and replaces them with another party.

A change of control clause anticipates a situation where there is a change in the ownership or control of a party to the contract.

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Assignment provisions in contracts

Author’s note, Nov. 22, 2014: For a much-improved update of this page, see the Common Draft general provisions article .

(For more real-world stories like the ones below, see my PDF e-book, Signing a Business Contract? A Quick Checklist for Greater Peace of Mind , a compendium of tips and true stories to help you steer clear of various possible minefields. Learn more …. )

Table of Contents

Legal background: Contracts generally are freely assignable

When a party to a contract “ assigns ” the contract to someone else, it means that party, known as the assignor , has transferred its rights under the contract to someone else, known as the assignee , and also has delegated its obligations to the assignee.

Under U.S. law, most contract rights are freely assignable , and most contract duties are freely delegable, absent some special character of the duty, unless the agreement says otherwise. In some situations, however, the parties will not want their opposite numbers to be able to assign the agreement freely; contracts often include language to this effect.

Intellectual-property licenses are an exception to the general rule of assignability. Under U.S. law, an IP licensee may not assign its license rights, nor delegate its license obligations, without the licensor’s consent, even when the license agreement is silent. See, for example, In re XMH Corp. , 647 F.3d 690 (7th Cir. 2011) (Posner, J; trademark licenses); Cincom Sys., Inc. v. Novelis Corp. , 581 F.3d 431 (6th Cir. 2009) (copyright licenses); Rhone-Poulenc Agro, S.A. v. DeKalb Genetics Corp. , 284 F.3d 1323 (Fed. Cir. 2002) (patent licenses). For additional information, see this article by John Paul, Brian Kacedon, and Douglas W. Meier of the Finnegan Henderson firm.

Assignment consent requirements

Model language

[Party name] may not assign this Agreement to any other person without the express prior written consent of the other party or its successor in interest, as applicable, except as expressly provided otherwise in this Agreement. A putative assignment made without such required consent will have no effect.

Optional: Nor may [Party name] assign any right or interest arising out of this Agreement, in whole or in part, without such consent.

Alternative: For the avoidance of doubt, consent is not required for an assignment (absolute, collateral, or other) or pledge of, nor for any grant of a security interest in, a right to payment under this Agreement.

Optional: An assignment of this Agreement by operation of law, as a result of a merger, consolidation, amalgamation, or other transaction or series of transactions, requires consent to the same extent as would an assignment to the same assignee outside of such a transaction or series of transactions.

• An assignment-consent requirement like this can give the non-assigning party a chokehold on a future merger or corporate reorganization by the assigning party — see the case illustrations below.

• A party being asked to agree to an assignment-consent requirement should consider trying to negotiate one of the carve-out provisions below, for example, when the assignment is connection with a sale of substantially all the assets of the assignor’s business {Link} .

Case illustrations

The dubai port deal (ny times story and story ).

In 2006, a Dubai company that operated several U.S. ports agreed to sell those operations. (The agreement came about because of publicity and political pressure about the alleged national-security implications of having Middle-Eastern companies in charge of U.S. port operations.)

A complication arose in the case of the Port of Newark: The Dubai company’s lease agreement gave the Port Authority of New York and New Jersey the right to consent to any assignment of the agreement — and that agency initially demanded $84 million for its consent.

After harsh criticism from political leaders, the Port Authority backed down a bit: it gave consent in return for “only” a $10 million consent fee, plus $40 million investment commitment by the buyer.

Cincom Sys., Inc. v. Novelis Corp., No. 07-4142 (6th Cir. Sept. 25, 2009) (affirming summary judgment)

A customer of a software vendor did an internal reorganization. As a result, the vendor’s software ended up being used by a sister company of the original customer. The vendor demanded that the sister company buy a new license. The sister company refused.

The vendor sued, successfully, for copyright infringement, and received the price of a new license, more than $450,000 as its damages. The case is discussed in more detail in this blog posting.

The vendor’s behavior strikes me as extremely shortsighted, for a couple of reasons: First, I wouldn’t bet much on the likelihood the customer would ever buy anything again from that vendor. Second, I would bet that the word got around about what the vendor did, and that this didn’t do the vendor’s reputation any good.

Meso Scale Diagnostics, LLC v. Roche Diagnostics GmbH, No. 5589-VCP (Del. Ch. Apr. 8, 2011) (denying motion to dismiss).

The Delaware Chancery Court refused to rule out the possibility that a reverse triangular merger could act as an assignment of a contract, which under the contract terms would have required consent. See also the discussion of this opinion by Katherine Jones of the Sheppard Mullin law firm.

Assignment with transfer of business assets

Consent is not required for an assignment of this Agreement in connection with a sale or other disposition of substantially all the assets of the assigning party’s business.

Optional: Alternatively, the sale or other disposition may be of substantially all the assets of the assigning party’s business to which this Agreement specifically relates.

Optional: The assignee must not be a competitor of the non-assigning party.

• A prospective assigning party might argue that it needed to keep control of its own strategic destiny, for example by preserving its freedom to sell off a product line or division (or even the whole company) in an asset sale.

• A non-assigning party might argue that it could not permit the assignment of the agreement to one of its competitors, and that the only way to ensure this was to retain a veto over any assignment.

• Another approach might be to give the non-assigning party, instead of a veto over asset-disposition assignments, the right to terminate the contract for convenience . (Of course, the implications of termination would have to be carefully thought through.)

Assignment to affiliate

[Either party] may assign this Agreement without consent to its affiliate.

Optional: The assigning party must unconditionally guarantee the assignee’s performance.

Optional: The affiliate must not be a competitor of the non-assigning party.

Optional: The affiliate must be a majority-ownership affiliate of the assigning party.

• A prospective assigning party might argue for the right to assign to an affiliate to preserve its freedom to move assets around within its “corporate family” without having to seek approval.

• The other party might reasonably object that there is no way to know in advance whether an affiliate-assignee would be in a position to fulfill the assigning party’s obligations under the contract, nor whether it would have reachable assets in case of a breach.

Editorial comment: Before approving a blanket affiliate-assignment authorization, a party should consider whether it knew enough about the other party’s existing- or future affiliates to be comfortable with where the agreement might end up.

Consent may not be unreasonably withheld or delayed

Consent to an assignment of this Agreement requiring it may not be unreasonably withheld or delayed.

Optional: For the avoidance of doubt, any damages suffered by a party seeking a required consent to assignment of this Agreement, resulting from an unreasonable withholding or delay of such consent, are to be treated as direct damages.

Optional: For the avoidance of doubt, any damages suffered by a party seeking a required consent to assignment of this Agreement, resulting from an unreasonable withholding or delay of such consent, are not subject to any exclusion of remedies or other limitation of liability in this Agreement.

• Even if this provision were absent, applicable law might impose a reasonableness requirement; see the discussion of the Shoney case in the commentary to the Consent at discretion provision.

• A reasonableness requirement might not be of much practical value, whether contractual or implied by law. Such a requirement could not guarantee that the non-assigning party would give its consent when the assigning party wants it. And by the time a court could resolve the matter, the assigning party’s deal could have been blown.

• Still, an unreasonable-withholding provision should make the non-assigning party think twice about dragging its feet too much, becuase of the prospect of being held liable for damages for a busted transaction. Cf. Pennzoil vs. Texaco and its $10.5 billion damage award for tortious interference with an M&A deal.

• Including an unreasonable-delay provision might conflict with the Materiality of assignment breach provision, for reasons discussed there in the summary of the Hess Energy case.

Consent at discretion

A party having the right to grant or withhold consent to an assignment of this Agreement may do so in its sole and unfettered discretion.

• If a party might want the absolute right to withhold consent to an assignment in its sole discretion, it would be a good idea to try to include that in the contract language. Otherwise, there’s a risk that court might impose a commercial-reasonableness test under applicable law (see the next bullet). On the other hand, asking for such language but not getting it could be fatal to the party’s case that it was implicitly entitled to withhold consent in its discretion.

• If a commercial- or residential lease agreement requires the landlord’s consent before the tentant can assign the lease, state law might impose a reasonableness requirement. I haven’t researched this, but ran across an unpublished California opinion and an old law review article, each collecting cases. See Nevada Atlantic Corp. v. Wrec Lido Venture, LLC, No. G039825 (Cal. App. Dec. 8, 2008) (unpublished; reversing judgment that sole-discretion withholding of consent was unreasonable); Paul J. Weddle, Pacific First Bank v. New Morgan Park Corporation: Reasonable Withholding of Consent to Commercial Lease Assignments , 31 Willamette L. Rev. 713 (1995) (first page available for free at HeinOnline ).

Shoney’s LLC v. MAC East, LLC, No. 1071465 (Ala. Jul. 31, 2009)

In 2009, the Alabama Supreme Court rejected a claim that Shoney’s restaurant chain breached a contract when it demanded a $70,000 to $90,000 payment as the price of its consent to a proposed sublease. The supreme court noted that the contract specifically gave Shoney’s the right, in its sole discretion , to consent to any proposed assignment or sublease.

Significantly, prior case law from Alabama was to the effect that a refusal to consent would indeed be judged by a commercial-reasonableness standard. But, the supreme court said, “[w]here the parties to a contract use language that is inconsistent with a commercial-reasonableness standard, the terms of such contract will not be altered by an implied covenant of good faith. Therefore, an unqualified express standard such as ‘sole discretion’ is also to be construed as written.” Shoney’s LLC v. MAC East, LLC , No. 1071465 (Ala. Jul. 31, 2009) (on certification by Eleventh Circuit), cited by MAC East, LLC v. Shoney’s [LLC] , No. 07-11534 (11th Cir. Aug. 11, 2009), reversing No. 2:05-cv-1038-MEF (WO) (M.D. Ala. Jan. 8, 2007) (granting partial summary judgment that Shoney’s had breached the contract).

Termination by non-assigning party

A non-assigning party may terminate this Agreement, in its business discretion , by giving notice to that effect no later than 60 days after receiving notice, from either the assigning party or the assignee, that an assignment of the Agreement has become effective.

Consider an agreement in which a vendor is to provide ongoing services to a customer. A powerful customer might demand the right to consent to the vendor’s assignment of the agreement, even in strategic transactions. The vendor, on the other hand, might refuse to give any customer that kind of control of its strategic options.

A workable compromise might be to allow the customer to terminate the agreement during a stated window of time after the assignment if it is not happy with the new vendor.

Assignment – other provisions

Optional: Delegation: For the avoidance of doubt, an assignment of this Agreement operates as a transfer of the assigning party’s rights and a delegation of its duties under this Agreement.

Optional: Promise to perform: For the avoidance of doubt, an assignee’s acceptance of an assignment of this Agreement constitutes the assignee’s promise to perform the assigning party’s duties under the Agreement. That promise is enforceable by either the assigning party or by the non-assigning party.

Optional: Written assumption by assignee: IF: The non-assigning party so requests of an assignee of this Agreement; THEN: The assignee will seasonably provide the non-assigning party with a written assumption of the assignor’s obligations, duly executed by or on behalf of the assignee; ELSE: The assignment will be of no effect.

Optional: No release: For the avoidance of doubt, an assignment of this Agreement does not release the assigning party from its responsibility for performance of its duties under the Agreement unless the non-assigning party so agrees in writing.

Optional: Confidentiality: A non-assigning party will preserve in confidence any non-public information about an actual- or proposed assignment of this Agreement that may be disclosed to that party by a party participating in, or seeking consent for, the assignment.

The Delegation provision might not be necessary in a contract for the sale of goods governed by the Uniform Commercial Code, because a similar provision is found in UCC 2-210

The Confidentiality provision would be useful if a party to the agreement anticipated that it might be engaging in any kind of merger or other strategic transaction.

Materiality of assignment breach

IF: A party breaches any requirement of this Agreement that the party obtain another party’s consent to assign this Agreement; THEN: Such breach is to be treated as a material breach of this Agreement.

A chief significance of this kind of provision is that failure to obtain consent to assignment, if it were a material breach, would give the non-assigning party the right to terminate the Agreement.

If an assignment-consent provision requires that consent not be unreasonably withheld , then failure to obtain consent to a reasonable assignment would not be a material breach, according to the court in Hess Energy Inc. v. Lightning Oil Co. , No. 01-1582 (4th Cir. Jan. 18, 2002) (reversing summary judgment). In that case, the agreement was a natural-gas supply contract. The customer was acquired by a larger company, after which the larger company took over some of the contract administration responsibilities such as payment of the vendor’s invoices. The vendor, seeking to sell its gas to someone else at a higher price, sent a notice of termination, on grounds that the customer had “assigned” the agreement to its new parent company, in violation of the contract’s assignment-consent provision. The appeals court held that, even if the customer had indeed assigned the contract (a point on which it expressed considerable doubt) without consent, the resulting breach of the agreement was not material, and therefore the vendor did not have the right to terminate the contract.

See also (list is generated automatically) :

• Notebook update: Reverse triangular merger might be an assignment of a contract, requiring consent Just updated the Notebook with a citation to a case in which the Delaware Chancery Court refused to rule out the possibility that a reverse...
• Assignment-consent requirements can cause serious problems in future M&A transactions A lot of contracts provide that Party A must obtain the prior written consent of Party B if it wishes to assign the agreement to a...
• SCOTX rejects implied obligation not to unreasonably withhold consent to assignment of contract In a recent Texas case, two sophisticated parties in the oil and gas busi­ness — let’s call them Alpha and Bravo — were negotiating a contract....
• Ken Adams and the marketplace of ideas I (used to) comment occasionally at Ken Adams’s blog. Recent examples: Here, here, here, here, and here. Ken and I disagree on a number of issues; some...

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How to Draft an Assignment of Contract

Last Updated: January 23, 2022

This article was co-authored by Clinton M. Sandvick, JD, PhD . Clinton M. Sandvick worked as a civil litigator in California for over 7 years. He received his JD from the University of Wisconsin-Madison in 1998 and his PhD in American History from the University of Oregon in 2013. This article has been viewed 5,316 times.

A contract is an agreement between at least two parties—A and B. However, one party might want to transfer the contract to someone else. For example, B might want to assign its rights and obligations to C. Sometimes, a contract prohibits assignment, in which case B can’t assign the contract to anyone. In other contracts, the other party to the original contract (here Party A) must also agree to the assignment from B to C. If the contract allows assignment, then an assignment can take place once a proper assignment agreement has been created.

Starting the Assignment Agreement

• If you are printing the agreement on letterhead, make sure to leave enough room at the top.

• Sample language could read, “This Assignment (‘Assignment’), dated as of [insert date] (‘Effective Date’), is made between [insert your name] (‘Assignor’) and [insert the name of the assignee] (‘Assignee’).” [1] X Research source

• Sample recitals could read, “Whereas, Assignor entered into the following Contract with [the name of the party you contracted with, called the ‘obligor’] on [insert date of the contract] (‘Contract’); and whereas Assignor wishes to assign all of its rights and obligations under the Contract to Assignee. Now, therefore, Assignor and Assignee agree as follows.”

Granting the Assignment

• A sample grant could read: “Assignor and Assignee hereby agree that the Assignor shall assign all its title, right, and interest, and delegate all its obligations, responsibilities, and duties, in and to the Contract to Assignee.”

• “Assignee hereby accepts the assignment of all of Assignor’s obligations, responsibilities, and duties under the Contract and all of Assignor’s right, title, and interest in and to the Contract.”

• A sample modification provision could read: “This Agreement may only be modified if the modification is made in writing and executed by both Assignor and Assignee. No verbal agreement is allowed.”

• The assignor could agree to indemnify the obligor: “Assignor agrees to defend and indemnify [insert name of the obligor] from any and all claims, judgments, actions, proceedings, liabilities, and costs, including reasonable attorneys’ fees and other costs of defense and damages, resulting from Assignor’s performance prior to the assignment of the Contract and resulting from Assignee’s performance after the assignment of the Contract. However, after the assignment of the Contract, [insert name of the obligor] shall first look to Assignee to satisfy all claims, actions, judgments, proceedings, liabilities, and costs, including reasonable attorneys’ fees and other costs of defense and damages resulting from Assignee’s performance.”
• The assignee should also agree to indemnify the obligor: “Assignee agrees to indemnify the [insert name of obligor] from any and all claims, judgments, actions, proceedings, liabilities, and costs, including reasonable attorneys’ fees and other costs of defense and damages, resulting from Assignee’s performance after the assignment of the Contract.”

Finalizing the Agreement

• You could write, “This Assignment shall be construed and interpreted, and the rights of the parties determined by, the laws of the State of Maine (without regard to the conflicts of law principles thereof or any other jurisdiction).” [2] X Research source

• A sample clause could read, “If any part of this Agreement is declared invalid or unenforceable, the remainder of the Agreement shall continue to be valid and enforceable.” [3] X Research source

• Just above the signature line, insert: “In witness whereof, the parties have caused this Assignment to be duly executed as of the date first written above.” [4] X Research source

• If you don’t have an attorney, then you should contact your local or state bar association and ask for a referral.
• When scheduling the consultation, ask how much the attorney charges.

Expert Q&A

You might also like.

• ↑ http://contracts.onecle.com/annies/baking-assignment-2014-03-20.shtml
• ↑ http://www.contractstandards.com/clauses/severability

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Assignment and Subletting Contract Clauses (754)

Grouped into 8 collections of similar clauses from business contracts.

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Assignability

Assignability clause samples

10.3 Assignability .This Agreement may not be assigned by either Party, without the written consent of the other Party, such consent not to be unreasonably withheld.

02/13/2020 (Baudax Bio, Inc.)

SUCCESSION AND ASSIGNABILITY . This Note shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. The Holder may not assign any of his or its rights, interests, or obligations hereunder on his or its own discretion without further approval from the Company.

06/06/2016 (Wrapmail, Inc.)

Section8.13 Non- Assignability . This Agreement and the rights and obligations of the parties under this Agreement may not be assigned or delegated by either party without the prior written consent of the other party, and any purported assignment without such consent shall be void.

02/02/2018 (2017 MANDATORY EXCHANGEABLE TRUST)

4. Non- Assignability . The Restricted Stock Unit shall not be transferable by the Grantee, except as the Plan or this Agreement may otherwise provide.

03/19/2021 (CuriosityStream Inc.)

Assignability . This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit of the Holder and its successors and assigns.

03/15/2021 (MMEX Resources Corp)

17. Assignability . During Employee’s employment, this Agreement may not be assigned by either party without the written consent of the other. However, Employer may assign its rights and obligations under this Agreement without Employee’s consent to a successor by sale, merger or liquidation, if such successor carries on the Business substantially in the form in which it is being conducted at the time of the sale, merger or liquidation. This Agreement is binding upon Employee, Employee’s heirs, personal representatives and permitted assigns and on Employer, its successors and assigns.

03/11/2019 (Trillium Therapeutics Inc.)

10.7. Assignability . This Agreement shall be binding upon, and shall be enforceable by and inure solely to the benefit of, the Parties and their respective successors and permitted assigns; provided, however, that neither this Agreement nor any of a Party’s rights or obligations hereunder may be assigned or delegated by such Party without the prior written consent of the other Party, and any attempted assignment or delegation of this Agreement or any of such rights or obligations by such Party without the other Party’s prior written consent shall be void and of no effect.

01/25/2019 (Edge Therapeutics, Inc.)

6.3 Assignability . Note shall be binding upon the Borrower and its successors and assigns, and shall inure to the benefit of the Holder and its successors and assigns. Subject to the prior written consent of the Company, the Holder may assign or transfer this Note to any transferee or have the shares that it converts under this Note sent to any third party. If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Note registered as the Holder may request and the Company may accept, representing the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal is being transferred, a new Note to the Holder representing the outstanding Principal not being transferred. The Holder and any assignee, by acceptance of this Nate, acknowledge and agree that, following conversion or redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal stated on the face of this Note.

05/26/2016 (NewLead Holdings Ltd.)

5. Assignability . This Amendment shall be binding upon, and shall be enforceable by and inure solely to the benefit of, the Parties and their respective successors and assigns.

12/14/2018 (APRICUS BIOSCIENCES, INC.)

C. Assignability . Neither party to this Agreement may assign all or any part of the party’s rights and obligations under the terms of this Agreement without the prior written consent of the other party. No assignment that is approved by the other party is to relieve the assignor of the assignor’s obligations under the terms of this Agreement if the assignee fails to perform those obligations.

12/12/2017 (Luther Burbank Corp)

6.4 Non- Assignability . This Agreement and the rights and obligations hereunder, shall be fully assignable by the Manager to an affiliate thereof. This Agreement and the rights and obligations hereunder shall not be assignable by any other party hereto without the written consent of all of the other parties hereto. Provided, however, that the foregoing shall not extend to assignments required by any insurance carrier in any matter relating to subrogation and shall not extend to an assignment by any Insured Entity in connection with a sale or financing of a Project or a portion thereof.

05/04/2018 (Spirit MTA REIT)

6. Assignability . This Amendment shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, including any purchasers of the Common Shares or the Warrants.

07/03/2019 (HISTOGENICS CORP)

11. ASSIGNABILITY . This Agreement is not transferable or assignable by the undersigned except as may be provided herein.

09/02/2016 (GEX MANAGEMENT, INC.)

3.4. Assignability . This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to the benefit of the Holder and its successors and assigns, and may not be assigned by the Holder without the prior written consent of the Borrower, which consent may not be unreasonably withheld.

09/02/2016 (Full Spectrum Inc.)

7. Assignability . Assignee shall not assign the Contract or this Assignment or any of its rights, interests, or obligations thereunder or hereunder without the prior written approval of Assignor. Any purported assignment in violation of this paragraph shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported assignee.

03/15/2021 (Aspirational Consumer Lifestyle Corp.)

2. Non- Assignability . This Agreement shall not be assignable without the prior written consent of the non-assigning party.

08/10/2016 (Affinity Gaming)

a. Captions and Headings. The Article and Section headings throughout this Agreement are for convenience of reference only and shall in no way be deemed to define, limit or add to any provision of this Agreement. b. Notification of Changes. Subscriber agrees and covenants to notify the Company immediately upon the occurrence of any event prior to the consummation of this Offering that would cause any representation, warranty, covenant or other statement contained in this Agreement to be false or incorrect or of any change in any statement made herein occurring prior to the consummation of this Offering. c. Assignability . This Agreement is not assignable by Subscriber, and may not be modified, waived or terminated except by an instrument in writing signed by the party against whom enforcement of such modification, waiver or termination is sought. d. Binding Effect. Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the parties and their heirs, executors, administrators, successors, legal representatives and assigns, and the agreements, representations, warranties and acknowledgments contained herein shall be deemed to be made by and be binding upon such heirs, executors, administrators, successors, legal representatives and assigns. e. Obligations Irrevocable. The obligations of Subscriber shall be irrevocable, except with the consent of the Company, until the consummation or termination of the Offering. f. Entire Agreement; Amendment. This Agreement states the entire agreement and understanding of the parties relating to the matters contained herein, superseding all prior contracts or agreements, whether oral or written. No amendment of the Agreement shall be made without the express written consent of the parties. g. Severability. The invalidity or unenforceability of any particular provision of this Agreement shall not affect any other provision hereof, which shall be construed in all respects as if such invalid or unenforceable provision were omitted.

01/12/2021 (Masterworks Collection 001, LLC)

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Legal Templates

Home Business Assignment Agreement

Assignment Agreement Template

Use our assignment agreement to transfer contractual obligations.

Updated February 1, 2024 Reviewed by Brooke Davis

An assignment agreement is a legal document that transfers rights, responsibilities, and benefits from one party (the “assignor”) to another (the “assignee”). You can use it to reassign debt, real estate, intellectual property, leases, insurance policies, and government contracts.

What Is an Assignment Agreement?

What to include in an assignment agreement, how to assign a contract, how to write an assignment agreement, assignment agreement sample.

Partnership Interest

An assignment agreement effectively transfers the rights and obligations of a person or entity under an initial contract to another. The original party is the assignor, and the assignee takes on the contract’s duties and benefits.

It’s often a requirement to let the other party in the original deal know the contract is being transferred. It’s essential to create this form thoughtfully, as a poorly written assignment agreement may leave the assignor obligated to certain aspects of the deal.

The most common use of an assignment agreement occurs when the assignor no longer can or wants to continue with a contract. Instead of leaving the initial party or breaking the agreement, the assignor can transfer the contract to another individual or entity.

For example, imagine a small residential trash collection service plans to close its operations. Before it closes, the business brokers a deal to send its accounts to a curbside pickup company providing similar services. After notifying account holders, the latter company continues the service while receiving payment.

Create a thorough assignment agreement by including the following information:

• Effective Date:  The document must indicate when the transfer of rights and obligations occurs.
• Parties:  Include the full name and address of the assignor, assignee, and obligor (if required).
• Assignment:  Provide details that identify the original contract being assigned.
• Third-Party Approval: If the initial contract requires the approval of the obligor, note the date the approval was received.
• Signatures:  Both parties must sign and date the printed assignment contract template once completed. If a notary is required, wait until you are in the presence of the official and present identification before signing. Failure to do so may result in having to redo the assignment contract.

Review the Contract Terms

Carefully review the terms of the existing contract. Some contracts may have specific provisions regarding assignment. Check for any restrictions or requirements related to assigning the contract.

Check for Anti-Assignment Clauses

Some contracts include anti-assignment clauses that prohibit or restrict the ability to assign the contract without the consent of the other party. If there’s such a clause, you may need the consent of the original parties to proceed.

Determine Assignability

Ensure that the contract is assignable. Some contracts, especially those involving personal services or unique skills, may not be assignable without the other party’s agreement.

Get Consent from the Other Party (if Required)

If the contract includes an anti-assignment clause or requires consent for assignment, seek written consent from the other party. This can often be done through a formal amendment to the contract.

Prepare an Assignment Agreement

Draft an assignment agreement that clearly outlines the transfer of rights and obligations from the assignor (the party assigning the contract) to the assignee (the party receiving the assignment). Include details such as the names of the parties, the effective date of the assignment, and the specific rights and obligations being transferred.

Include Original Contract Information

Attach a copy of the original contract or reference its key terms in the assignment agreement. This helps in clearly identifying the contract being assigned.

Execution of the Assignment Agreement

Both the assignor and assignee should sign the assignment agreement. Signatures should be notarized if required by the contract or local laws.

Notice to the Other Party

Provide notice of the assignment to the non-assigning party. This can be done formally through a letter or as specified in the contract.

File the Assignment

File the assignment agreement with the appropriate parties or entities as required. This may include filing with the original contracting party or relevant government authorities.

Communicate with Third Parties

Inform any relevant third parties, such as suppliers, customers, or service providers, about the assignment to ensure a smooth transition.

Keep Copies for Records

Keep copies of the assignment agreement, original contract, and any related communications for your records.

Here’s a list of steps on how to write an assignment agreement:

Step 1 – List the Assignor’s and Assignee’s Details

List all of the pertinent information regarding the parties involved in the transfer. This information includes their full names, addresses, phone numbers, and other relevant contact information.

This step clarifies who’s transferring the initial contract and who will take on its responsibilities.

Step 2 – Provide Original Contract Information

Describing and identifying the contract that is effectively being reassigned is essential. This step avoids any confusion after the transfer has been completed.

Step 3 – State the Consideration

Provide accurate information regarding the amount the assignee pays to assume the contract. This figure should include taxes and any relevant peripheral expenses. If the assignee will pay the consideration over a period, indicate the method and installments.

Step 4 – Provide Any Terms and Conditions

The terms and conditions of any agreement are crucial to a smooth transaction. You must cover issues such as dispute resolution, governing law, obligor approval, and any relevant clauses.

Step 5 – Obtain Signatures

Both parties must sign the agreement to ensure it is legally binding and that they have read and understood the contract. If a notary is required, wait to sign off in their presence.

Related Documents

• Purchase Agreement : Outlines the terms and conditions of an item sale.
• Business Contract : An agreement in which each party agrees to an exchange, typically involving money, goods, or services.
• Lease/Rental Agreement : A lease agreement is a written document that officially recognizes a legally binding relationship between two parties -- a landlord and a tenant.
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Assignment And Assumption Agreement

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What is an assignment and assumption agreement.

An assignment and assumption agreement transfers one party's rights and obligations to a third party. The party making the assignment is called the assignor, while the third party accepting the assignment is known as the assignee.

The assignor assigns their rights and duties under the contract to the assignee and the assignee accepts, or "assumes," those rights and duties.

The other party to the initial contract must also consent to the transfer of rights and obligations to the assignee. For a valid assignment and assumption agreement, the initial contract must provide for the possibility of assignment by one of the initial contracting parties.

Common Sections in Assignment And Assumption Agreements

Below is a list of common sections included in Assignment And Assumption Agreements. These sections are linked to the below sample agreement for you to explore.

Assignment And Assumption Agreement Sample

Reference : Security Exchange Commission - Edgar Database, EX-99.D.13 3 d416323dex99d13.htm ASSIGNMENT AND ASSUMPTION AGREEMENT , Viewed October 6, 2021, View Source on SEC .

Who Helps With Assignment And Assumption Agreements?

Lawyers with backgrounds working on assignment and assumption agreements work with clients to help. Do you need help with an assignment and assumption agreement?

Post a project  in ContractsCounsel's marketplace to get free bids from lawyers to draft, review, or negotiate assignment and assumption agreements. All lawyers are vetted by our team and peer reviewed by our customers for you to explore before hiring.

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Corporate Attorney that represents startups, businesses, investors, VC/PE doing business throughout the country. Representing in a range of matters from formation to regulatory compliance to financings to exit. Have a practice that represents both domestic and foreign startups, businesses, and entrepreneurs. Along with VC, Private Equity, and investors.

Attorney Skelly is a midwestern transplant from Iowa. She has been in Florida for the past 11 years. She went to undergrad at Buena Vista University, which is a small liberal arts college in Storm Lake, Iowa. After graduating with her Bachelor's degree in criminal justice, she went on to obtain her Master's degree in criminal justice from Kaplan university, which is now Purdue Global. While attending school full time for her Master’s degree, Attorney Skelly worked full time in social services helping children and their families who were involved in the dependency system. Attorney Skelly has a professional background in child welfare and social services having worked for 18 years in the field. Attorney Skelly always had a lifelong dream of becoming a lawyer and decided to fulfill her goal in May of 2019 by starting law school at Western Michigan University Thomas M. Cooley Law School at their Riverview campus. She did their accelerated program and completed law school in just over two years and graduated magna cum laude with honors. Attorney Skelly also received certificate of merit awards, which means attaining the highest grade in the class in secured transactions, research and writing, and family violence practice. While in law school Attorney Skelly was a teaching assistant to two tenured professors as well as a note taker for those students who had accommodations. She was also awarded the Alumni Association’s Distinguished Student Award. In her legal career, Attorney Skelly started out at the State Attorney’s Office in Fort Myers, FL. She helped prosecute several cases and personally worked as second chair on 9 jury trials and one bench trial. Once Attorney Skelly passed the bar, she worked for a family law firm under a board certified marital and family law practitioner where she gained tremendous knowledge in the area of family law which includes divorce, paternity, child custody/parenting plans, alimony and child support as well as domestic relations issues such as domestic violence injunctions. Attorney Skelly is also certified as a Guardian ad Litem and can serve as a Guardian ad Litem in family court cases. Attorney Skelly is a proud member of the Florida Bar, the Lee County Bar Association, and the American Bar Association.

In my thirteen years of practice, I've had the opportunity to argue cases in state, federal, and tribal courts; in subjects as diverse as gaming, land tenure, water rights, treaty rights, finance, employment, criminal defense, conflict of laws, and tort (among others). But the real value I brought my clients came through avoiding litigation, fostering relationships, and developing long-term strategies.

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Owner at Irak Law Office in Merrillville, Indiana. Licensed attorney since 2015. Primary focuses include business/corporate law, startup formation, and contract drafting. Love working with small businesses and entrepreneurs.

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Permitted Transferees: What a Commercial Tenant Needs to Know When Negotiating the Assignment Clause

February 27, 2020

Are you a business owner or franchisee?

Will you be negotiating a lease in the foreseeable future?

Can you see your business model evolving during the lease term?

If the answer to these questions is “yes”, here is what you need to know when negotiating the transfer provisions in your next commercial lease.

What is the Assignment Clause and When is it Triggered?

Every commercial lease contains an assignment provision that lays out the landlord’s and the tenant’s rights and obligations in the event that the tenant seeks to “assign” the lease.

An “assignment” can occur in two scenarios:

Assignment of Lease : The first, and most common to lay people, occurs when the original tenant transfers and grants all of its rights and obligations under the lease to a third party, and the new tenant explicitly accepts these rights and obligations as its own and occupies the leased space.

Transfer of Ownership Interests in Tenant Entity : The second occurs when the tenant entity transfers its stock, membership or partnership interests (depending on whether the tenant entity is a corporation, limited liability company or partnership) to a third party entity, resulting in a change in ownership. In this scenario, the tenant under the lease remains the same — the transfer occurs internally within the tenant’s corporate structure.

Although the transfer that takes place in the second scenario does not seem like a traditional “assignment” (because the existing tenant remains in the space), most leases treat changes in control of the tenant entity as such. What constitutes a “change in control” that triggers an assignment, however, is negotiable. Typically, a transfer of a majority (51% or more) of the tenant’s stock, membership or partnership interests will suffice.

What do Landlords Typically Require to Effectuate an “Assignment”?

What a landlord requires to effectuate an “assignment” varies depending on how tough the landlord is and how much bargaining power it has. Below are several concepts you will typically encounter in a landlord’s form of lease.

Landlord Notice : Almost every commercial landlord will require a tenant to give it notice of any assignment of the lease. Landlords want to stay informed, which is not unreasonable.

Landlord Consent : In addition to notice, the landlord will often condition the assignment on its prior written consent. The key here is the standard of discretion imposed on the landlord — that is, whether the landlord must be “reasonable” in granting its consent, or whether it has “sole discretion” to do so. A tenant should push for the “reasonable” standard so that the landlord does not have the liberty to deny the tenant’s request for any or no reason at all, and should also negotiate to receive the Landlord’s decision promptly.

In determining whether to grant consent to an assignment, a landlord’s goal is to ensure that the proposed assignee will be able to satisfy the tenant’s obligations under the lease. As such, a landlord typically requires the submission of (1) a statement indicating the name and address of the proposed assignee, the nature of its business and the proposed uses of the leased space, (2) the proposed assignee’s most recent financial statements, and (3) an assignment and assumption agreement, stating that (a) the proposed assignee takes on all of the current tenant’s obligations under the lease and (b) the current tenant agrees to remain fully liable for the performance of all of the assignee’s obligations thereunder.

A more aggressive landlord will expressly condition its consent on the presence or absence of certain circumstances, such as: (1) the tenant not being in default under the lease, (2) the tenant not publicly advertising the space for a rental rate lower than the rent then being paid by the tenant, (3) the proposed assignee being financially responsible to the extent required for payment of rent and for successfully operating the business, (4) the proposed assignee having a net worth equal to or greater than that of the tenant, (5) the proposed assignee having a minimum amount of years of successful experience in the field of business to be conducted by it in the leased space, (6) the proposed assignee not being an entity with whom the landlord is then or has recently been negotiating to lease space, and (7) the proposed assignment being made in connection with the tenant’s sale to the proposed assignee of its business then being conducted in the leased space.

Payment of Monies : Also common are provisions requiring the tenant to reimburse the landlord for all of the reasonable costs incurred by it in connection with an assignment, including attorneys’ fees. If a tenant asks its landlord to engage an attorney to review assignment documents, it is only fair that the tenant pays for such costs. However, the tenant should negotiate a cap on these costs.

Sometimes the landlord will also require the proposed assignee to put up additional security, but this provision only passes muster when the proposed assignee is a risky one, making the additional security requirement reasonable.

Less common are instances in which the landlord requires the tenant to pay it a certain percentage of the entire gross consideration that the tenant receives from the proposed assignee (if any) in connection with the assignment, whether it be the monies received in selling the business or those received in a stock transfer.

Right of Termination / Space Recapture : Occasionally, a tenant will encounter a provision stating that upon receipt of the tenant’s request to assign, the landlord will have a right to terminate the lease and recapture the space. In other words, merely giving notice of the intent to assign triggers a landlord’s termination/recapture right. This is worst-case scenario and the tenant should negotiate its way out of such a provision.

What Should a Tenant Push For When Negotiating the Transfer Provisions?

Given the many conditions typically imposed by a landlord to effectuate an “assignment”, a tenant should push to incorporate the “permitted transferee” concept into its lease. A “permitted transferee” is an entity to which the tenant is permitted to carry out a transfer without the landlord’s prior written consent.

Transfers to a “permitted transferee” are not deemed “assignments” under the lease. Therefore, the onerous assignment requirements outlined above are not triggered, allowing the tenant to proceed with a transfer to certain pre-approved entities without having to fulfill any obligations under the lease (other than providing the standard notice to the landlord).

Commonly used examples of “permitted transferees” include: (1) the tenant’s parent, or any of its subsidiaries or affiliates, (2) an entity into which or with which the tenant is merged, consolidated or reorganized, (3) an entity to which all or substantially all of the tenant’s assets, stock or other equity interests are transferred, and (4) the tenant’s franchisor or another franchisee.

Can you see your business model evolving during the term of your next lease? If the answer is “yes”, you should negotiate with your landlord to incorporate the “permitted transferee” concept into your lease. The carve-out will work to save you much time and resources in operating your business.

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