Do contracts and leases transfer to me in an asset purchase?

An asset purchase buys a list, not a company, so the contracts a business relies on do not arrive by default. The lease, the supplier agreements, the customer contracts and the licences each stay with the seller until something moves them. An Ontario law firm’s guide to asset purchases puts it plainly: each contract the seller has with a third party has to be specifically identified and either assigned to the buyer or replaced.

Why a share purchase is different

The same guide notes that in a share purchase the company itself does not change, so its contracts stay in its name and no assignment is needed. That contrast is the practical cost of choosing an asset purchase for other reasons: someone has to move each contract, and the other side of each one gets a say.

Leases and contracts with consent clauses

In Ontario, section 23 of the Commercial Tenancies Act generally implies that consent to assign a commercial lease is not to be unreasonably withheld, unless the lease says otherwise, so the lease wording governs. Supplier, financing and customer contracts often carry anti-assignment or change-of-control clauses, which can lead to refusal, renegotiation or termination. Our page on the anti-assignment clause explains how they work. Other provinces have their own tenancy rules.

Intellectual property moves by assignment too

The Canadian Intellectual Property Office describes a trademark as a form of property that can be sold or transferred by assignment, and advises telling the Registrar about changes in ownership to avoid disagreements. For copyright, it describes an assignment as the transfer of some or all of your rights, and it lets you register an assignment and receive a certificate of registration.

When a consent does not arrive in time

The Ontario guide lists the options: close without that contract and deal with it afterwards, set up an interim arrangement, make the missing consent a condition of closing, or adjust the price. Its practical advice is to list every material contract, review each for restrictions, start the consent requests early and track each response as a closing condition.