Both parties should agree on who will bear this additional cost. As a rule, the client pays the fees of the main supplier for the preparatory work. If the amount of the fees cannot be agreed before the start of the preparatory work, it would be desirable to indicate, at least in the customer`s main supplier contract, that the main supplier may claim reasonable costs or related fees for the preparatory work. If the seller needs the current use of IT assets (as part of a sale of only part of its business), it should be checked whether a “Mirror and Split” approach is appropriate. As part of a “Mirror and Split” approach, the seller agrees to replicate the relevant parts of its IT environment so that the seller can continue to use the IT assets to support the retained part of its business. In this context, it is necessary to not only be satisfied with the assets (e.g.B. software and hardware), but also with the contractual agreements that underpin the assets. This involves negotiations with the relevant IT partner in order to set up this thoughtful environment. Buyers and sellers need to agree on who is responsible for creating this environment.

In this article, I`ve highlighted the most common issues a primary vendor faces during contract change and best practices for risk reduction. Generally speaking, the terms of the licence contain a clause indicating the circumstances in which the assignment or novation of licences is permitted, which generally include M&A activities. A recipient of IT services may minimise the risks associated with the future sale of some or all of its business by ensuring, when negotiating agreements with its IT suppliers, that those agreements include: (i) the possibility for the recipient of IT services to transfer the agreement to a purchaser of its assets without the need for the IT provider`s agreement i st; and (ii) the obligation for an IT provider to provide equivalent services to a purchaser of certain assets of the IT service recipient during a transitional period. The greater the volume and complexity of third-party contracts, the higher the cost of pre-novation activities. . . .