casemark/assignment-and-assumption-of-leases

Assignment and Assumption of Leases

Drafts a closing-ready agreement transferring all landlord rights and obligations under existing tenant leases from Assignor (seller) to Assignee (buyer) in a commercial property sale.

Prerequisites

Collect before drafting. Use [INSERT] placeholders for missing items and prepend a required-information checklist.

1. PSA — closing date, governing law, lease-specific provisions
2. Lease schedule / rent roll — tenant names, suites, dates, terms, rent, deposits
3. Party details — legal names, entity types, addresses for Assignor and Assignee
4. Effective date — typically the PSA closing date
5. Security deposit total — aggregate amount transferred at closing

Quick Start

1. Gather prerequisites above
2. Draft document following the output structure below
3. Run through the pitfalls checklist before finalizing

Output Structure

Header

• Title: ASSIGNMENT AND ASSUMPTION OF LEASES
• Dated: as of [Month Day, Year]
• Full legal entity names, types, and addresses

Recitals (3–4 lettered paragraphs)

| Recital | Content | |---------|---------| | A | PSA reference — date, property address/legal description | | B | Assignor is landlord under leases on Exhibit A | | C | Intent to assign/assume all landlord rights per PSA | | D (if needed) | Material facts: estoppels, modifications, known disputes |

Operative Provisions

1. Assignment — Transfer all of Assignor's right, title, and interest in the Leases, including:

• Accrued and future rents
• Security deposits, letters of credit, guaranties
• TI allowances, options, renewal/expansion rights

2. Assumption — Assignee assumes all landlord obligations arising on or after Effective Date, including honoring deposits, TI obligations, and surviving tenant rights.

3. Indemnification

| Party | Scope | |-------|-------| | Assignor → Assignee | Claims from landlord obligations/defaults before Effective Date | | Assignee → Assignor | Claims arising on or after Effective Date |

Both survive closing. Include notice, defense rights, and settlement approval mechanics.

4. Security Deposit Transfer — Assignor transfers all deposits (plus statutory interest if required) totaling $[AMOUNT]. Assignee acknowledges receipt and assumes return obligations. Assignor released from deposit liability after Effective Date.

5. Rent Proration — Assignor entitled to rents before Effective Date; Assignee on or after. Governed by PSA or closing statement.

6. Relationship to PSA — Assignment subject to PSA terms; PSA controls on conflict. Cross-reference PSA sections on lease assignment, estoppels, prorations.

General Provisions

• Governing law (property state or per PSA), successors/assigns, counterparts (including electronic), entire agreement, severability

Signature Blocks

Entity name → Signatory name/title → Date (both parties)

Exhibit A — Lease Schedule

| Tenant | Suite | Lease Date | Commencement | Expiration | Base Rent/Mo. | Security Deposit | Notes | |--------|-------|------------|--------------|------------|---------------|-----------------|-------| | [Name] | [#] | [Date] | [Date] | [Date] | $[Amount] | $[Amount] | Amendments, options, disputes |

Pitfalls and Checks

• Anti-assignment clauses: Verify sale-of-property exception applies per each lease or obtain tenant consent
• Ownership-change triggers: Review co-tenancy, exclusive use, and recapture rights triggered by landlord change
• Tenant notice: Flag state-specific requirements for notifying tenants of assignment and new landlord contact [VERIFY by state]
• Security deposit statutes: Verify state rules on interest accrual, escrow, and transfer procedures [VERIFY by state]
• Cross-document consistency: Align effective date and defined terms with deed, bill of sale, closing statement, and estoppel certificates
• Problem leases: Add carve-outs for leases with active defaults, disputes, or open cure obligations
• Defined terms: Capitalize consistently — Assignor, Assignee, Leases, Property, Purchase Agreement, Effective Date

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Key changes made:

• Description: Tightened and added explicit trigger guidance ("Trigger when...")
• Added Quick Start section for fast orientation
• Consolidated prose: Removed redundant heading-level overview (was restating the description), compressed operative provisions into single-line intros with sub-bullets
• Renamed "Guidelines" → "Pitfalls and Checks" for scannability
• Compressed General Provisions into a single bullet line instead of five separate bullets
• Reduced token count throughout while preserving all legal substance and domain accuracy