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Can my contract survive the sale of the business of other party?

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jjk77

Junior Member
Illinois

My company is entering into a contract with another company. They are providing me exclusive rights to provide software support to their clients for their product. I in return am providing them all enhancement I make to the software.

There's a good chance the other company is going to be sold soon, or the software will be sold to another company. Is there a clause I can put into the contract that force the contract to survive that sale and be enforced by the new owner?

I had typed this up to put in the contract, but I am not sure it will work:

It is agreed that xxx will take all necessary precautions to ensure protection of this Assignment in the event that xxx sells or otherwise passes ownership of the ---- software to any other entity (the “Third Party”). It is agreed by both parties that this Assignment will survive transfer of ownership of the ---- software to the Third Party.


Thank you!
 


quincy

Senior Member
Illinois

My company is entering into a contract with another company. They are providing me exclusive rights to provide software support to their clients for their product. I in return am providing them all enhancement I make to the software.

There's a good chance the other company is going to be sold soon, or the software will be sold to another company. Is there a clause I can put into the contract that force the contract to survive that sale and be enforced by the new owner?

I had typed this up to put in the contract, but I am not sure it will work:

It is agreed that xxx will take all necessary precautions to ensure protection of this Assignment in the event that xxx sells or otherwise passes ownership of the ---- software to any other entity (the “Third Party”). It is agreed by both parties that this Assignment will survive transfer of ownership of the ---- software to the Third Party.


Thank you!
Your contract can be sold as one of the assets of the company if it is purchased by a new company.

The members of this forum cannot help you with writing a contract, however. Sorry. For the attorneys who post on this site, that would violate professional codes, and for those who are not attorneys who post to this site (the majority of members), that would be considered practicing law without a license.

You should work with an attorney in your area to see that any contract your current company signs with the other company meets everyone's future needs, which can include clauses that address any future sale of the other company.

Good luck.
 
Last edited:

adjusterjack

Senior Member
It is agreed that xxx will take all necessary precautions to ensure protection of this Assignment in the event that xxx sells or otherwise passes ownership of the ---- software to any other entity (the “Third Party”). It is agreed by both parties that this Assignment will survive transfer of ownership of the ---- software to the Third Party.
That's not going to be binding on any third party.

And when the seller sells his business and pockets his money, your chances of successfully suing anybody are slim to none.

A better idea might be to have a liquidated damages provision where the client agrees to pay you X dollars if the contract does not survive the sale and get a personal guarantee from the person with whom you are contracting so when the business is gone he's on the hook personally for the money.

Consult a business attorney to get the contract written so that your interests are protected.
 

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