Lease Termination Agreement
(Commercial Lease) (VA)

Summary

This lease termination agreement template provides for the early termination of a lease of commercial property in Virginia. This template includes practical guidance, drafting notes, and alternate and optional clauses. A landlord and tenant may wish to terminate their lease early if the tenant no longer needs the leased space but prefers not to enter into an assignment or sublease (which may require the tenant to remain liable under its lease), the landlord exercises its recapture right under the lease, or the landlord finds another tenant interested in leasing the space on more competitive terms. Whatever the reason, if the parties agree to terminate their lease before the stated expiration of the lease term, they should execute a lease termination agreement (sometimes also called a surrender agreement) to set forth the rights and responsibilities of the parties in connection with early termination. The lease termination agreement should address the timing for the tenant's surrender of the premises; the condition of the premises upon surrender; required payments, such as termination fees and continued rental payments through surrender; the release of the parties; and surviving obligations. Counsel should modify this template as needed to reflect the agreed-upon deal terms. Note that if the tenant is relocating to a different location in the same building, or if the tenant is surrendering only a portion of its premises, the parties may wish to amend the existing lease in lieu of terminating the lease and executing a new one. For guidance on drafting and negotiating commercial lease amendments, see Closing an Office Lease Transaction, Closing an Industrial Lease Transaction, and Closing a Retail Lease Transaction. Conform the capitalized terms in this template to the relevant lease agreement and termination agreement. For further information on lease termination agreements, see Surrender Agreements in Commercial Leasing. For further information on commercial leases in Virginia, see Commercial Real Estate Leasing (VA).