This review list is intended to educate you about this document and to guide you in its preparation. This is a simple Assignment Agreement that may be updated for further assignments.
- Make several copies so that each party has one original. Include a copy in your minute book, make it accessible to any financial institution requesting copies of capital equipment commitments, and maintain a separate copy in your equipment lease or vendor file.
Assignment Of Equipment Lease
Assignment of Equipment Lease
This Assignment of Equipment Lease (“Assignment”) is made as of _______________ (Date) by and between ___________________________ Original Lessee (“Assignor”) of _______________________________ (Address) and ___________________________ New Lessee (“Assignee”) of _______________________________________________.
Whereas by a lease dated _________ made between ____________________, the original Lessor (the “Lessor”) and the Assignor (the “Lease”), the Lessor leased to the Assignor ___________________________________________ (“Equipment”), subject to the covenants and agreements contained in the Lease, a copy of which is attached hereto as Exhibit 1; and the Assignor wishes to assign to the Assignee, and the Assignee wishes to be assigned, the Lease;
Therefore in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged) the parties hereby agree as follows:
1. The Assignor hereby assigns to the Assignee its interest in the Equipment and the Lease and all benefit and advantage to be derived there from.
2. The Assignee covenants and agrees to pay the monthly lease payments and observe and perform all of the lessee’s covenants and obligations contained in the Lease.
3. The Assignee agrees to be bound by all the terms, covenants, conditions and obligations in the Lease as if the Assignee had entered into the Lease with the Lessor and as if the Assignee were the original lessee under the Lease.
4. The Assignee agrees to obtain a consent from the Lessor, whereby the Lessor consents to the assignment of the Lease to the Assignee.
5. The Assignee indemnifies and holds harmless the Assignor from and against any and all costs, expenses, damages and losses which the Assignor may suffer or incur relating to the Equipment and the Lease from and after the date hereof, including but not limited to any costs, expenses, damages and losses which arise as a result of the failure of the Assignee to comply with the terms of this paragraph.
6. This Assignment shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and assigns.
7. Notices.
Any notice required by this Agreement or given in connection with it, shall be in writing and shall be given to the appropriate party by personal delivery or a recognized over night delivery service such as FedEx.
If to the Assignor: _____________________________________________________.
If to the Assignee: _____________________________________________________.
If to the Lessor: _______________________________________________________.
8. No Waiver.
The waiver or failure of either party to exercise in any respect any right provided in this agreement shall not be deemed a waiver of any other right or remedy to which the party may be entitled.
9. Entirety of Agreement.
The terms and conditions set forth herein constitute the entire agreement between the parties and supersede any communications or previous agreements with respect to the subject matter of this Agreement. There are no written or oral understandings directly or indirectly related to this Agreement that are not set forth herein. No change can be made to this Agreement other than in writing and signed by both parties.
10. Governing Law.
This Agreement shall be construed and enforced according to the laws of the State of ____________________ and any dispute under this Agreement must be brought in this venue and no other.
11. Headings in this Agreement
The headings in this Agreement are for convenience only, confirm no rights or obligations in either party, and do not alter any terms of this Agreement.
12. Severability.
If any term of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, then this Agreement, including all of the remaining terms, will remain in full force and effect as if such invalid or unenforceable term had never been included.
In Witness whereof, the parties have executed this Agreement as of the date first written above.
_________________________ _______________________
Assignor Assignor___________________ _______________________
Date LessorExhibit 1: Original Lease
Assignment of Equipment Lease
Review ListThis review list is provided to inform you about this document in question and assist you in its preparation. This is a straightforward Assignment Agreement, which may be modified for other assignments.
1. Make multiple copies so all parties may have one original copy. Include a copy in your minute book, make it available to any financial institution that requires you to provide copies of capital equipment obligations, and keep a separate copy in the equipment lease or vendor file.
Frequently Asked Questions
What is an Assignment of Equipment Lease?
An Assignment of Equipment Lease is a legal document used to transfer the rights and obligations of an existing equipment lease from the original lessee (Assignor) to a new lessee (Assignee). The document identifies the parties, the original lease, and the equipment, and states that the Assignor assigns its interest in the equipment and the lease to the Assignee. It is commonly used when a business or individual wishes to transfer their lease obligations to another party.
Who are the parties involved in an Assignment of Equipment Lease?
The parties are the Assignor, who is the original lessee transferring the lease, and the Assignee, who is the new lessee receiving the lease rights and obligations. The original lessor may also be involved if consent is required, though the document itself is between the Assignor and Assignee. The Assignor and Assignee are identified by name and address in the assignment.
What information must be included in an Assignment of Equipment Lease?
The assignment must include the date of the assignment, the names and addresses of the Assignor and Assignee, the date of the original lease, the names of the original lessor and lessee, and a description of the equipment being leased. It should also reference the attached copy of the original lease as an exhibit. The document must clearly state the Assignor's intent to assign and the Assignee's acceptance of the assignment.
Why would someone assign an equipment lease?
A lessee might assign an equipment lease to transfer the remaining rights and obligations to another party, often to avoid continuing lease payments or to allow another business to use the equipment. The assignment allows the Assignee to step into the original lessee's position and receive the benefits of the lease. The Assignor may wish to be relieved of the lease obligations, though the assignment itself does not necessarily release the Assignor unless the lessor agrees.
Does the original lessor need to consent to the assignment?
The assignment document provided does not explicitly state whether the original lessor's consent is required. However, most equipment leases contain provisions requiring the lessor's consent before any assignment. The assignment itself is between the Assignor and Assignee, but the original lease terms may govern whether consent is needed. It is advisable to review the original lease and consult with the lessor to ensure compliance.
What happens to the Assignor's obligations after assignment?
The assignment transfers the Assignor's interest in the equipment and the lease to the Assignee, but it does not automatically release the Assignor from its obligations under the original lease. Unless the lessor agrees to release the Assignor, the Assignor may remain liable for the lease obligations. The Assignee covenants and agrees to perform the lease terms, but the Assignor's liability depends on the original lease and any release obtained.
Is an Assignment of Equipment Lease legally binding?
Yes, when properly executed and if it complies with applicable law and the original lease terms, an Assignment of Equipment Lease is a legally binding contract between the Assignor and Assignee. It is supported by mutual covenants and consideration, as stated in the document. However, its enforceability may depend on whether the original lessor's consent was obtained if required.
What is the effect of the assignment on the Assignee?
The Assignee receives the Assignor's interest in the equipment and the lease, including all benefits and advantages derived from it. The Assignee covenants and agrees to assume the obligations under the lease. This means the Assignee becomes responsible for complying with the lease terms and making any required payments.
Can an equipment lease be assigned without the lessor's knowledge?
The assignment document does not address whether the lessor must be notified or consent. In practice, assigning a lease without the lessor's knowledge may violate the original lease terms if it requires consent. The assignment is between the Assignor and Assignee, but the lessor's rights under the original lease may still be affected. It is important to review the lease and obtain any necessary consents.
What should be attached to an Assignment of Equipment Lease?
A copy of the original lease should be attached as an exhibit, as indicated in the document. This provides the Assignee with the full terms and conditions of the lease being assigned. The assignment itself references the attached lease as Exhibit 1. Including the original lease ensures all parties have access to the governing terms.
