Amendment Agreement

Summary

This amendment agreement can be used for amending or modifying commercial contracts of any type. This template includes practical guidance, drafting notes, and alternate clauses. This amendment agreement should be read alongside the agreement that will be amended. The provisions should provide exact instructions on how the underlying agreement is to be altered. This includes addressing definitions, punctuation, language, further changes that flow from the amendments (such as numbering), and the like. Counsel should consider how each change will affect the remainder of the underlying agreement, and make such further changes accordingly so that the document retains its consistency and accurateness. For example, if a limited warranty is added by way of amendment, the agreement's "cumulative remedies" provision should be deleted, as it contradicts this addition. Furthermore, the attorney drafting the amendment should use best efforts to add new sections (or subsections) in a manner that least disrupts the underlying agreement. For example, if an additional section (or subsection) can easily and logically be added to the end of the agreement (or subsection), instead of in the middle, then that is how it should be done. This concept applies to all changes to keep the amendment as simple and clean as possible. Commercial contracts routinely incorporate an amendment clause addressing how the parties may amend the agreement. Most of these clauses require amendments (and waivers) to be made in writing and signed either: (1) by all of the parties to the agreement; or (2) by "the party to be charged" (i.e., the party against whom the modification is to be enforced). These provisions are often referred to as "no oral amendments" clauses, and sometimes require the executed writing to be specifically identified as an amendment to the underlying contract. However, parties to an agreement commonly amend or waive certain terms throughout the course of their relationship without preparing and executing the requisite amendment. In such instances, courts regularly uphold oral amendments and waivers based upon the parties' actions and words. Best practices, however, would include preparing the written amendments required pursuant to the underlying agreement. If the parties to an agreement have a tremendous number of changes to their agreement, instead of creating and executing an amendment such as this one, they can create an entirely new agreement, incorporating all of the parties' desired terms, and refer to it as the "Amended and Restated Agreement." Such a document would necessarily include language stating that the prior agreement is "hereby terminated and shall be of no further force or effect." Sometimes, in lieu of amending an agreement, a party is simply looking to obtain a one-time waiver or consent from the other party. This is an appropriate course of action when the other party will not agree to permanently amend a provision of the underlying agreement but agrees to grant a one-time waiver for a particular event or instance of non-performance. For amendment clauses, see Amendments Clauses. For general information regarding contract drafting, see Commercial Contract Drafting and Review.