• Assignment Clause

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Assignment clause defined.

Assignment clauses are legally binding provisions in contracts that give a party the chance to engage in a transfer of ownership or assign their contractual obligations and rights to a different contracting party.

In other words, an assignment clause can reassign contracts to another party. They can commonly be seen in contracts related to business purchases.

Here’s an article about assignment clauses.

Assignment Clause Explained

Assignment contracts are helpful when you need to maintain an ongoing obligation regardless of ownership. Some agreements have limitations or prohibitions on assignments, while other parties can freely enter into them.

Here’s another article about assignment clauses.

Purpose of Assignment Clause

The purpose of assignment clauses is to establish the terms around transferring contractual obligations. The Uniform Commercial Code (UCC) permits the enforceability of assignment clauses.

Assignment Clause Examples

Examples of assignment clauses include:

  • Example 1 . A business closing or a change of control occurs
  • Example 2 . New services providers taking over existing customer contracts
  • Example 3 . Unique real estate obligations transferring to a new property owner as a condition of sale
  • Example 4 . Many mergers and acquisitions transactions, such as insurance companies taking over customer policies during a merger

Here’s an article about the different types of assignment clauses.

Assignment Clause Samples

Sample 1 – sales contract.

Assignment; Survival .  Neither party shall assign all or any portion of the Contract without the other party’s prior written consent, which consent shall not be unreasonably withheld; provided, however, that either party may, without such consent, assign this Agreement, in whole or in part, in connection with the transfer or sale of all or substantially all of the assets or business of such Party relating to the product(s) to which this Agreement relates. The Contract shall bind and inure to the benefit of the successors and permitted assigns of the respective parties. Any assignment or transfer not in accordance with this Contract shall be void. In order that the parties may fully exercise their rights and perform their obligations arising under the Contract, any provisions of the Contract that are required to ensure such exercise or performance (including any obligation accrued as of the termination date) shall survive the termination of the Contract.

Reference :

Security Exchange Commission - Edgar Database,  EX-10.29 3 dex1029.htm SALES CONTRACT , Viewed May 10, 2021, <  https://www.sec.gov/Archives/edgar/data/1492426/000119312510226984/dex1029.htm >.

Sample 2 – Purchase and Sale Agreement

Assignment . Purchaser shall not assign this Agreement or any interest therein to any Person, without the prior written consent of Seller, which consent may be withheld in Seller’s sole discretion. Notwithstanding the foregoing, upon prior written notice to Seller, Purchaser may designate any Affiliate as its nominee to receive title to the Property, or assign all of its right, title and interest in this Agreement to any Affiliate of Purchaser by providing written notice to Seller no later than five (5) Business Days prior to the Closing; provided, however, that (a) such Affiliate remains an Affiliate of Purchaser, (b) Purchaser shall not be released from any of its liabilities and obligations under this Agreement by reason of such designation or assignment, (c) such designation or assignment shall not be effective until Purchaser has provided Seller with a fully executed copy of such designation or assignment and assumption instrument, which shall (i) provide that Purchaser and such designee or assignee shall be jointly and severally liable for all liabilities and obligations of Purchaser under this Agreement, (ii) provide that Purchaser and its designee or assignee agree to pay any additional transfer tax as a result of such designation or assignment, (iii) include a representation and warranty in favor of Seller that all representations and warranties made by Purchaser in this Agreement are true and correct with respect to such designee or assignee as of the date of such designation or assignment, and will be true and correct as of the Closing, and (iv) otherwise be in form and substance satisfactory to Seller and (d) such Assignee is approved by Manager as an assignee of the Management Agreement under Article X of the Management Agreement. For purposes of this Section 16.4, “Affiliate” shall include any direct or indirect member or shareholder of the Person in question, in addition to any Person that would be deemed an Affiliate pursuant to the definition of “Affiliate” under Section 1.1 hereof and not by way of limitation of such definition.

Security Exchange Commission - Edgar Database,  EX-10.8 3 dex108.htm PURCHASE AND SALE AGREEMENT , Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1490985/000119312510160407/dex108.htm >.

Sample 3 – Share Purchase Agreement

Assignment . Neither this Agreement nor any right or obligation hereunder may be assigned by any Party without the prior written consent of the other Parties, and any attempted assignment without the required consents shall be void.

Security Exchange Commission - Edgar Database,  EX-4.12 3 dex412.htm SHARE PURCHASE AGREEMENT , Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1329394/000119312507148404/dex412.htm >.

Sample 4 – Asset Purchase Agreement

Assignment . This Agreement and any of the rights, interests, or obligations incurred hereunder, in part or as a whole, at any time after the Closing, are freely assignable by Buyer. This Agreement and any of the rights, interests, or obligations incurred hereunder, in part or as a whole, are assignable by Seller only upon the prior written consent of Buyer, which consent shall not be unreasonably withheld. This Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and permitted assigns.

Security Exchange Commission - Edgar Database,  EX-2.1 2 dex21.htm ASSET PURCHASE AGREEMENT , Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1428669/000119312510013625/dex21.htm >.

Sample 5 – Asset Purchase Agreement

Assignment; Binding Effect; Severability

This Agreement may not be assigned by any party hereto without the other party’s written consent; provided, that Buyer may transfer or assign in whole or in part to one or more Buyer Designee its right to purchase all or a portion of the Purchased Assets, but no such transfer or assignment will relieve Buyer of its obligations hereunder. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the successors, legal representatives and permitted assigns of each party hereto. The provisions of this Agreement are severable, and in the event that any one or more provisions are deemed illegal or unenforceable the remaining provisions shall remain in full force and effect unless the deletion of such provision shall cause this Agreement to become materially adverse to either party, in which event the parties shall use reasonable commercial efforts to arrive at an accommodation that best preserves for the parties the benefits and obligations of the offending provision.

Security Exchange Commission - Edgar Database,  EX-2.4 2 dex24.htm ASSET PURCHASE AGREEMENT , Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1002047/000119312511171858/dex24.htm >.

Common Contracts with Assignment Clauses

Common contracts with assignment clauses include:

  • Real estate contracts
  • Sales contract
  • Asset purchase agreement
  • Purchase and sale agreement
  • Bill of sale
  • Assignment and transaction financing agreement

Assignment Clause FAQs

Assignment clauses are powerful when used correctly. Check out the assignment clause FAQs below to learn more:

What is an assignment clause in real estate?

Assignment clauses in real estate transfer legal obligations from one owner to another party. They also allow house flippers to engage in a contract negotiation with a seller and then assign the real estate to the buyer while collecting a fee for their services. Real estate lawyers assist in the drafting of assignment clauses in real estate transactions.

What does no assignment clause mean?

No assignment clauses prohibit the transfer or assignment of contract obligations from one part to another.

What’s the purpose of the transfer and assignment clause in the purchase agreement?

The purpose of the transfer and assignment clause in the purchase agreement is to protect all involved parties’ rights and ensure that assignments are not to be unreasonably withheld. Contract lawyers can help you avoid legal mistakes when drafting your business contracts’ transfer and assignment clauses.

no assignment clause meaning

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“Change your partner?” Beware of Non-Assignment Clauses in Commercial Contracts

“ I now pronounce you man and wife .”

Congratulations! You are married.

But what if you woke up one morning and found someone other than your spouse at the breakfast table?

“Who are you ?”

“Hi. I am your new spouse. I hope you don’t mind. Your old one decided to move on and appointed me to take over. But don’t worry. I will fulfill all of your former spouse’s marital responsibilities faithfully. And, of course, I am entitled to all of your former spouse’s benefits. We have an appointment with the bank later today to formalize our new joint account. But enough small talk. What’s for breakfast?”

While that scenario is a bit unusual for domestic partners, when it comes to commercial partners — especially commercial partners who are just entering into a business relationship together — there is often a legitimate concern by one — or both — that they avoid waking up one morning to find out that they are in business with someone else.

So how do commercial partners make sure that the party they thought they were going to be doing business with when they signed their contract remains their partner throughout the life of the agreement?

They include in the contract a non-assignment clause.

The basic idea is simple — we entered into this contract because of who you are and what you bring to the table. We don’t want to wake up one morning and find ourselves in business with anyone else but you. Therefore, you are not allowed to transfer your rights or obligations under this contract to anyone else without our consent. If you do, this contract is over and you may have to pay damages as well.

This is simple in concept but watch what happens when the lawyers try to say it. It comes out like this:

“This Agreement and all rights and duties hereunder are personal to Party B and shall not, without the written consent of Party A, be assigned, mortgaged, or otherwise encumbered by Party B or by operation of law.  For purposes of this Agreement, the term “assignment” shall, in addition to the transfer of this Agreement or the rights or obligations thereunder, whether voluntarily, involuntarily, by operation of law, or otherwise, be deemed to include (i) a sale or other transfer by Party B of all or substantially all of its assets; (ii) the merger, amalgamation, consolidation, or reorganization of Party B into or with another corporation or other entity as a result of which Party B is not the surviving corporation; or (iii) any transaction (including any of the foregoing transactions, as well as any in which Party B is the surviving corporation) which, whether by way of sale, gift, or other transfer, whether involving Party B or the record or beneficial owners of equity interests in Party B, results in the transfer of more than twenty percent (20%)  of the voting control of Party B to a party or parties not a principal of Party B at the time of execution of this Agreement.”

Here are some things to look for when you finally get to the end of the contract where the non-assignment clause is usually hiding.

  • Is it mutual or one-way only ? Very often a contract that calls itself a “mutual” agreement and starts out talking about both parties doing this or that will suddenly change tone in the assignment clause and become one-sided, as follows: Party A can assign to anyone it wants. Party B cannot assign to anyone without Party A’s permission. Watch out for this.
  • Corporate reorganization . Businesses are often organized into parent and subsidiary companies or separate companies with a common owner. Sometimes for business or tax reasons it is a good idea to reorganize the internal corporate structure of a business. Before that happens, you need to check the assignment clause of each contract between any of the companies that is being “reorganized” to make sure that what you are doing is not a breach of that contract. Better yet, when you are negotiating the contract in the first place, try to make sure that you are free to internally organize your business without having to ask permission of any other commercial partner. As long as the reorganization does not result in a different owner or management team, then, in theory, the other side should not care. They are still effectively doing business with the same partner. But some companies can get awfully nitpicky about it.
  • Change of control . One step removed from corporate reorganization is a change of control. Whereas it might be true that the outward looking interface between the company and its customers, vendors and commercial partners has not changed, on the inside there is suddenly a new owner of the business. Many companies are understandably nervous about a change in ownership of their commercial partners and so they make sure to include language that will not allow it to happen without their consent. If you are a company that is getting into business with another party specifically because of who owns or controls the business, make sure you include this language to protect you.
  • You mean I can’t even sub-contract or sub-license ? Well, that depends on what your contract language says. While in theory the job of a non-assignment clause is to prevent you from turning the entire contract over to someone else and moving on, in practice the language will sometimes prevent you from even contracting out part of the job. If you rely heavily on sub-contractors or if your business involves sub-licenses, make sure that the non-assignment clause does not technically trip you up.
  • Can I get rid of it altogether ? One of the most aggravating experiences for a start-up company that has succeeded and is now on the verge of selling out (or going public) is not being able to close the deal until they get permission from every commercial party with whom they signed a contract containing a restrictive non-assignment clause. This can be a frustrating and time consuming process. If only we had thought of this when we were drafting all of those contracts! Well, you can. You can try for something as simple as this in all of your commercial contracts:

Party B may assign this Agreement and its rights and obligations hereunder in connection with a corporate reorganization, merger or combination, or a sale of all or substantially all of the equity or assets of Party B.

But be careful when the other side says yes, and then the contract comes back looking like this:

Party B may assign this Agreement and its rights and obligations hereunder in connection with a corporate reorganization, merger or combination, or a sale of all or substantially all of the equity or assets of Party B; provided, however, that Party B agrees to remain secondarily liable for the performance of its assignee .

Now you are still on the hook! And, worse, you no longer are in control of what happens. This is not where you want to end up when you are looking to make your big exit.

  • Don’t be too nice . Even the most accommodating partners need to set certain limits when it comes to letting the other party assign the contract. For example, under no circumstances should the other party be allowed to assign to a competitor of yours. Or, let’s say you are doing business with the government — the other party should not be allowed to assign to anyone that would cause you to be in breach of specific government regulations such as origin of product or exporting of technology restrictions.

As always, an experienced commercial attorney will be able to recognize the advantages and disadvantages for both parties of an agreement limiting assignability.

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Rethinking the “No Assignment” Provision

27 November 2023 20 November 2012 | Ken Adams

In this post , Brian Rogers explains how, as an experiment in crowdsourcing contract language, he has posted on Quora ( here ) his candidate for “the best anti-assignment provision in a contract ever.” He says that it’s “probably lifted” from Negotiating and Drafting Contract Boilerplate (Tina Stark ed. 2003) ( NDCB ). Here’s Brian’s provision:

Neither party may assign any of its rights under this agreement, either voluntarily or involuntarily, whether by merger, consolidation, dissolution, operation of law, or any other manner, except with the prior written consent of the other party. Neither party may delegate any performance under this agreement, except with the prior written consent of the other party. Any purported assignment of rights or delegation of performance in violation of this section is void.

It so happens that I’ve been idly contemplating shortcomings in standard no-assignment language. That’s something that I’ve tackled previously ( here ), and Brian’s post prodded me to revisit the topic.

I’ll start by offering the following comments on Brian’s provision:

  • In the interest of consistency I prefer using “shall not” for language of prohibition, but that’s something I’m still exploring. Using “neither party may” works too.
  • If you provide for the possibility of consent, it would be safest to assume that consent can’t be unreasonably withheld. If you have a problem with that, omit any mention of consent.
  • Isn’t “voluntarily or involuntarily” needless elaboration, analogous to saying “I don’t eat fish, whether fresh-water or salt-water”?
  • To avoid having to be all encompassing (“or in any other manner”), I’d use “including”.
  • You might want to make it clear whether the prohibition applies to mergers regardless of whether the party is the surviving or disappearing entity (see this post ).
  • The distinction between assigning rights and delegating obligations is pointless; in this context, “assign” and “delegate” constitute what I call “misapplied terms of art” (see this post ). Because the provision refers to what is being assigned and delegated, a generic alternative to both words would work just as well, and I opt for “transfer”. Regarding that choice, NDCB , at 56, says, “The problem, however, is that there are reams of cases that analyze ‘assign,’ but not ‘transfer.’ If ‘transfer’ were used alone, the precedential value of the existing cases might be compromised. Moreover, the cases already question the meaning of ‘transfer.'” This doesn’t worry me, as the context makes it clear what’s going on.
  • It’s unclear what “rights” refers to. (I don’t use the word “rights” anywhere in MSCD .) I think it refers to discretion granted to a party under an agreement and any remedy that a party has under an agreement, and I’d rather make that explicit.
  • By referring to delegation of performance rather than delegation of obligations, Brian’s provision seeks to reflect that a party might delegate not only a duty but also a condition. See NDCB at 26, 74. But I think it’s unrealistic to expect readers to deduce that nuance from a reference to delegation of performance; it would be better to make it explicit.
  • The last sentence is language of policy. I suggest that because it relates to a contingent future event, most native English speakers would say “will be void” rather than “is void”.

So here’s my initial version (it’s certain to change) [ Updated 9 August 2016: Language tidied up]:

Except with the prior written consent of the other party, each party shall not transfer, including by merger (whether that party is the surviving or disappearing entity), consolidation, dissolution, or operation of law, (1) any discretion granted under this agreement, (2) any right to satisfy a condition under this agreement, (3) any remedy under this agreement, or (4) any obligation imposed under this agreement. Any purported transfer in violation of this section X will be void.

Because my version makes explicit what Brian’s version only alludes to, it’s longer, but not by much (85 words versus 72 words).

I’ve posted my version on Quora, under Brian’s. (Hey, Brian! In. Yo. Face!) But crowdsourcing is still no way to identify optimal contract language. In particular, I wouldn’t rely on contract language select by haphazard vote. Instead, what you have here is the usual process of Brian, me, and others hashing stuff out. I look forward to having readers point out the weaknesses in my version.

[ Updated 27 November 2023: Bear in mind that in some contexts—notably bankruptcy—no-transfer provisions are unenforceable by law. See my 2014 article on termination-on-bankruptcy provisions, here .]

no assignment clause meaning

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of  A Manual of Style for Contract Drafting , and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.

17 thoughts on “Rethinking the “No Assignment” Provision”

I have several concerns here. First, I have never been happy with the “each party shall not” formulation. I don’t mind “may not,” or better yet, “no party may,” but if you really want to use “shall not,” then I recommend “a party shall not” as being less awkward and contrary to normal usage.

Second, I’m surprised that you would allow “by operation of law” to survive here. For the most part, this phrase is used to refer to the “automagic” continuation of the disappearing company’s contracts under the aegis of the surviving company in a merger, in which case the language is redundant when you’ve already discussed mergers. Moreover, if this language relates to some other operations of law, for example an order of a bankruptcy court, it’s rather hubristic to think a contract can trump the ruling authority. Better, if it’s such a big deal, to handle the consequences of such a mandated transfer by giving the affected party an explicit termination right (without the nasty consequences of breach).

Third, in my experience the issues surrounding “delegation” are not only that it’s a misapplied term of art, but that it mistakes the transfer of a contractual obligation for a subcontracting of its performance. In fact, reliance on delegation or transfer is misplaced if one is concerned about subcontracting (since it doesn’t really amount to a transfer of any contractual obligation, only having that obligation physically performed by someone else). A drafter should inquire carefully what the client is really concerned about here, and if it’s subcontracting, that should be explicitly mentioned.

Ah, thank you Vance. I thought My discomfort with ‘delegate’ was a translation issue from US to UK English. I,too, Think that is the wrong word to use.

“No purported transfer of one or more of the following arising from this agreement will be valid without prior written consent of the other party: (1) discretion, (2) right to satisfy a condition, (3) remedy under this agreement, and (4) obligation.”

Other than light trimming, the principal thing this version does is dump the duty not to transfer and go solely with the avoidance of purported transfers. Why prohibit killing the dead?

Because failure to comply with a prohibition gives rise to a remedy; voiding purported transfers doesn’t. I can imagine situations where that might be significant.

No one can fail to comply with a prohibition against transfer when purported transfers are void. Void transfers are non-transfers. Killing the dead isn’t wicked, it’s just impossible.

It’s wicked and depraved! Actually, what happens if Acme makes a purported assignment that results in costly and protracted litigation? Widgetco would like to be able to go after Acme. Wouldn’t that be easier if Widgetco could point to breach? Should the obligation refer to not attempting to transfer?

“Any purported transfer by Acme, without Widgetco’s advance written consent, of one or more of Acme’s rights or obligations under this agreement will be void and will constitute a breach of this agreement.”

This game is based so much on underlying US laws on the meaning of assignment, merger, etc, that it is impossible for a non-US lawyer to participate. We don’t generally have mergers where a party disappears into a puff of smoke. A sale of a business [nearly] always happens by a sale of shares or a sale of assets.

I think the concept of assigning rights under a contract is well established in case law and using different terminology is reinventing the wheel.

I think the “if you do it despite the prohibition, it will be void” concept is strange, but one that I have seen before in US contracts. I don’t think it works, under English law, in respect of prohibitions on assignments of IP. I am doubtful whether it works for assignments of rights under contracts.

For what it is worth, my English law version would be very different and would simply say:

Neither party may assign any rights, or transfer any obligations, under this agreement, without the prior written agreement of the parties.

I have used the word “agreement” rather than “consent” to try to avoid case law on whether a term should be implied that consent should not be unreasonably withheld. The terminology of assignment and transfer is based on a House of Lords case, Linden Gardens v Lenesta Sludge – see http://www.bailii.org/uk/cases/UKHL/1993/4.html

As usual, caselaw is of less interest to me than the scope for confusion. I suspect that if you ask many lawyers what is meant by assignment of rights under a contract, you’d get quite a variety of answers.

Okay, Ken I’ll take your word for it. English lawyers who keep Chitty on Contracts under their pillows won’t be so variegated

Mark: Regarding your statement, “I think the ‘if you do it despite the prohibition, it will be void’ concept is strange, but one that I have seen before in US contracts,” consider the probable source of such provisions:

Since U.S. contract law is the province of the states, we have the high court of each of the 50 states reviewing the handiwork of probably twice that number of state appellate courts, which in turn have reviewed the work of probably thousands of trial courts. In addition, we have almost 90 federal district courts trying to predict how the supreme courts of the various states would rule if they were hearing the contracts cases that have fallen into the laps of the federal courts due to accidents of jurisdiction, plus the dozen courts of appeals and the Supreme Court. Then there are specialty federal courts such as the bankruptcy and tax courts which provide an additional source of cases for the federal district and appellate courts to review. And did I mention the extensive administrative law system that probably dwarfs all of the above in scope and which I’m sure has plenty to say about contracts?

Somewhere, sometime in the distant past one of those courts had an unfortunate fact pattern and, wanting to avoid the effect of an anti-assignment provision, decided that although the purported assignment was a breach of the contract in which it was found, the assignment was still effective. Other courts picked up on the work-around, and commercial lawyers have all been covering that base ever since.

Thanks Brian, interesting insight. I would have posted on your site but For the reasons given above I didn’t have a useful contribution.

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The language as being quoted from Negotiating and Drafting Boilerplate is incomplete. Here is the full language, along with explanations of some of the text. Many of my points will be at odds with those of Ken and arise because of differences in drafting philosophy.

Assignment and Delegation.

(a) No Assignments. No party may assign any of its rights under this Agreement, except with the prior written consent of the other party. [That party shall not unreasonably withhold its consent.] All assignments of rights are prohibited under this subsection, whether they are voluntary or involuntary, by merger, consolidation, dissolution, operation of law, or any other manner. For purposes of this Section,

(i) a “change of control” is deemed an assignment of rights; and

(ii) “merger” refers to any merger in which a party participates, regardless of whether it is the surviving or disappearing corporation.

(b) No Delegations. No party may delegate any performance under this Agreement.

(c) Consequences of Purported Assignment or Delegation. Any purported assignment of rights or delegation of performance in violation of this Section is void.

1. The provision is divided into three separate subsections, each dealing with a different topic. A long provision violates the so-called “three-line rule.” Sentences longer than three lines are hard for the reader to take in. Also, by separating assignment from delegation, the drafter is reminded that each of these provisions may need to be elaborated based on facts. (Perhaps delegation is permitted subject to certain conditions.)

2. Generally, exceptions should not begin a sentence. The usual rule is to state the rule – so that the reader has context – and then state the exception. This is also helpful if the sentence contains multiple exceptions that the drafter might want to tabulate.

3. I prefer “No party may” to “Each party shall not.” The sentence’s purpose is to express a prohibition that applies to all – no one can do it. In this context, a negative subject is appropriate: no party/neither party. When using a negative subject “may” is correct. “Shall not” works perfectly well when the subject of the sentence is a single party. “Sam shall not borrow any money.”

4. As to whether consent can be unreasonably withheld is a matter of state law. Some states read into a provision that grants discretionary authority an implied promise of good faith and fair dealing, stated differently, they read in reasonableness. Others do not imply a reasonableness requirement. For example, in New York, landlords may be unreasonable in denying consent to assignment.

5. Courts seriously dislike anti-assignment provisions. They view them as interfering with the free flow of commerce. They insist that if a particular assignment is to be prohibited, it must be listed. For example, if a provision prohibits the assignment of rights, the issue arises as to whether the provision prohibits the assignment of rights by merger. In all states that I’ve checked, unless the assignment by merger is explicitly prohibited, it’s permitted. The courts are rather adamant. They’ll turn their decisions inside out to find the anti-assignment provision unenforceable. They don’t like them and if the provision isn’t explicit, the courts will say that if the parties had really wanted to prohibit assignments by merger, they knew how to use their words. “Voluntarily or involuntarily” is used consistent with these cases.

6. Drafters have tried multiple ways to create all-inclusive provisions, but the courts reject them as not having been specific. “or in any other manner” was blessed by one court, so it’s used in the provision. Another court rejected the phrase “or by any other transfer,” stating that it did not know what “transfer” meant and it therefore could not act as an omnibus savings provision.

7. An anti-assignment provision should also address whether a change of control is deemed an assignment. If Parent Company A sells all of its issued and outstanding shares in Subsidiary A to Buyer Company, Subsidiary A becomes a wholly-owned subsidiary of Buyer Company. Nothing has happened at the Subsidiary A level; there’s been no assignment. Courts hold that unless the change of control is expressly prohibited, it does not rise to the level of an assignment. This prohibition can generally be accomplished in one of two ways: either through a definition, as in the stated provision, or by including a change of control as a default.

8. Assignment and delegation are terms of art, not misapplied terms of art. The Restatement (Second) of Contracts carefully defines them, as do legions of cases. Unfortunately, some lawyers are unfamiliar with them because their contracts courses didn’t cover them. That doesn’t mean new words should be created.

9. Rights are the flip-side of an obligation. If I have an obligation to pay you $100, you have a right to my performance. The transfer of the right to performance is what the assignment is all about. It’s technical. Using terms in a technical way creates precision. If one has discretionary authority, that is a colloquial right but not a contract right. That’s the reason why “right” is not used to signal discretionary authority. Instead, the correct verb to signal discretionary authority is “may”. Incorrect: The publisher has the right to reject the book. Correct: The publisher may reject the book.

Rights can also refer to remedies, but that is consistent with the definition of rights. If a party has a right to have its deposit returned, the flipside obligation is the obligation to return it. If a party has a right to an injunction, the flipside obligation is the promise not to contest the right to the injunction.

10. “Will be void” v. “is void.” I can’t get too excited about this issue. I start from the premise that the contract should always read as if it presently applies and that, therefore, the present tense is correct.

11. Subsection (c) is another consequence of the courts’ dislike for anti-assignment provisions. Mere prohibition does not void the assignment. The courts draw a distinction between the “right” to assign and the “power” to assignment. A flat prohibition merely prohibits the assignment of the right to assignment. Violation of the prohibition is a breach, like any other contract breach. The assignment is enforceable, but gives rise to damages. Unfortunately, the nonassigning party often has trouble finding damages to claim. What difference does it make to whom it pays money? If the nonassigning party’s performance is somehow changed, then damages might be claimed. To make the purported assignment unenforceable, a provision must take away the “power” to assign. That is accomplished through language along the lines of subjection (c).

Tina: Thanks; some readers might find that extract helpful.

More generally, the only drafting philosophy I buy into is identifying the clearest contract language.

Do you see any issues with making the transfer voidable by the non-transferring party instead of void ab initio?

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No Assignment Contract Clauses (923)

Grouped into 44 collections of similar clauses from business contracts.

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What Is an Assignment Clause?

An assignment clause spells out which contractual obligations, rights, and duties may be transferred from one of the contractual parties to another party. 3 min read updated on February 01, 2023

Updated October 29, 2020:

An assignment clause spells out which contractual obligations, rights, and duties may be transferred from one of the contractual parties to another party. The assignment may be in whole or in part, and the clause also details the conditions under which a party can assign these duties.

U.S. law dictates that most contractual rights can be freely assigned or delegated, unless an agreement states otherwise.

The assignment clause often overlaps with two other clauses:

  • Parties in Interest
  • Successors and Assigns

These control who assumes contractual rights and obligations.

Legal Background and Freely Assignable Rights

When one party in a contract “assigns” the agreement to someone else, this means the first party — the assignor — transfers its contractual rights and obligations to the second party — the assignee.

In some instances, one party will not want the other contractual party to freely assign its duties. Contracts will then include language that states this.

One exception to the general assignability rule is intellectual property licenses . Legally, a licensor must first give consent before an IP licensee can assign or delegate its rights or obligations, even in the case where the license agreement is silent.

Requirements for Assignment Consent

There are different ways to say the same thing in a contract. Some people prefer lengthier statements, and others like to keep things brief. The following are various ways to make the same points.

  • One contractual party isn't allowed to assign its agreement to another person without prior written consent of the other contractual party, except as provided for in the contract. If an assignment is made without this consent, it won't be considered valid.
  • One party may not assign any interest or right arising out of this contract — in whole or in part — without prior consent.
  • To keep all doubts at bay, no consent is required for an assignment — including collateral, absolute, or other — for a contractual right to payment.

These are the takeaways from these stipulations:

  • This type of requirement for an assignment clause can create obstacles for the non-assigning party in corporate reorganizations or future mergers.
  • The party that's being asked to consent to an assignment clause requirement may want to negotiate its position. For instance, it may find negotiations helpful in a situation when the assignment involves a substantial sale.

A Party May Not Unreasonably Withhold or Delay Consent

It's not permissible to hold up consent to unreasonable delays.

Other ways to state this include:

  • To avoid doubt, a party that suffers damage due to the unreasonable delay or withholding of consent by the other party can treat them as direct damages.
  • To avoid doubt, damages that arise to one party from the unreasonable delay or withholding of consent by the other party aren't excluded from remedies.

Even when these provisions aren't in place, the law may still impose a reasonableness requirement. This requirement may not hold a lot of practical value, whether it's implied by the law or contractual. A reasonableness requirement can't guarantee that the non-assigning party will give consent when the assigning party wants it. By the time a case has worked its way through the court system to a decision, the deal that the assigning party was working on could have fallen through or otherwise be negated or moot.

However, this provision for unreasonable withholding should get the non-assigning party to carefully consider taking too much time due to the prospect of being held liable for damages. This can result in costly consequences.

On the other hand, having an unreasonable delay provision could create conflict with the provision concerning material breach of contract.

When you enter into a contract, it's important that you know what your rights and obligations are, as well as the other party's rights and obligations. If you don't want certain outcomes — assignment of duties, for instance — you must usually make it clear in the agreement. Getting help from a legal professional in the contract law field is a good idea when writing up a contract . That way, you increase the chances of covering everything you want covered, from the finer points to the bigger ones.

If you need help with contracts, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

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Content Approved by UpCounsel

  • Legal Assignment
  • Assignment Law
  • Consent to Assignment
  • Assignment of Rights and Obligations Under a Contract
  • Assignment of Rights Example
  • Assignment Contract Law
  • Assignability Of Contracts
  • What Is the Definition of Assigns
  • Assignment Legal Definition
  • Delegation vs Assignment

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United States: When Is An "Assignment" Clause Worth Fighting For?

View Megan M. Coneeny Biography on their website

Q. My small business is negotiating with a vendor who has asked to remove our contract’s “assignment” clause entirely. Is it worth the time to argue over whether to include an assignment clause?

A.  First, it’s important to understand the purpose of the assignment clause. “Assignment” occurs when a party transfers its rights and obligations under a contract to another party. Generally, unless the parties have agreed otherwise, each can assign its rights and obligations freely.

Article 2 of the Uniform Commercial Code, a set of laws governing the sale of goods that has been adopted by 49 states, including New Hampshire, provides that a party can freely assign its rights and obligations to another unless such assignment would materially change the duties of the other party, burden the other party, or decrease the other party’s chances of receiving performance under the contract.

If your vendor eliminates the assignment clause and no agreement on the topic is provided in the contract, your vendor will be free to transfer its obligations to another person or company without giving you notice or obtaining your approval.

Parties do have the ability, however, to mutually decide against the free assignability of a contract and this is often accomplished through an assignment clause. An assignment clause spells out which, if any, of a party’s obligations and rights under a contract are able to be assigned, or transferred, to another party. Free assignability and no assignability are not the only options, and you and your vendor can negotiate terms for assignment that are amenable to both of you.

For example, some clauses allow for assignment with the other party’s consent, meaning, the vendor would have to obtain your approval of the assignee prior to assigning any of its rights or obligations under the contract. Other times, assignment clauses allow for free assignment only to certain persons or entities, such as the vendor’s subsidiaries and affiliates, provided that the vendor gives you notice of such permitted assignment. Another option is to allow for assignment by the vendor provided that it guaranties the assignee’s performance.

Consider potential situations in which the vendor may want to assign the contract and determine whether it’s important to you to have control over assignment in each instance.

Consider discussing situations in which it may be important for the vendor to have freedom of assignment and, instead of removing the provision all together, specify those situations in which assignment is permitted, list those rights or obligations that are assignable, and consider whether, when assignment is permitted, notice, consent or a guaranty will be required.

Published in the Union Leader (2/25/2019)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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no assignment clause meaning

no assignment clause meaning

Spotting issues with assignment clauses in M&A Due Diligence

Written by: Kira Systems

January 19, 2016

6 minute read

Although not nearly as complex as change of control provisions , assignment provisions may still present a challenge in due diligence projects. We hope this blog post will help you navigate the ambiguities of assignment clauses with greater ease by explaining some of the common variations. (And, if you like it, please check out our full guide on Reviewing Change of Control and Assignment Provisions in Due Diligence. )

What is an Assignment Clause?

First, the basics:

Anti-assignment clauses are common because without them, generally, contracts are freely assignable. (The exceptions are (i) contracts that are subject to statutes or public policies prohibiting their assignment, such as intellectual property contracts, or (ii) contracts where an assignment without consent would cause material and adverse consequences to non-assigning counterparties, such as employment agreements and consulting agreements.) For all other contracts, parties may want an anti-assignment clause that allows them the opportunity to review and understand the impact of an assignment (or change of control) before deciding whether to continue or terminate the relationship.

In the mergers and acquisitions context, an assignment of a contract from a target company entity to the relevant acquirer entity is needed whenever a contract has to be placed in the name of an entity other than the existing target company entity after consummation of a transaction. This is why reviewing contracts for assignment clauses is so critical.

A simple anti-assignment provision provides that a party may not assign the agreement without the consent of the other party. Assignment provisions may also provide specific exclusions or inclusions to a counterparty’s right to consent to the assignment of a contract. Below are five common occurrences in which assignment provisions may provide exclusions or inclusions.

Common Exclusions and Inclusions

Exclusion for change of control transactions.

In negotiating an anti-assignment clause, a company would typically seek the exclusion of assignments undertaken in connection with change of control transactions, including mergers and sales of all or substantially all of the assets of the company. This allows a company to undertake a strategic transaction without worry. If an anti-assignment clause doesn’t exclude change of control transactions, a counterparty might materially affect a strategic transaction through delay and/or refusal of consent. Because there are many types of change of control transactions, there is no standard language for these. An example might be:

In the event of the sale or transfer by [Party B] of all or substantially all of its assets related to this Agreement to an Affiliate or to a third party, whether by sale, merger, or change of control, [Party B] would have the right to assign any or all rights and obligations contained herein and the Agreement to such Affiliate or third party without the consent of [Party A] and the Agreement shall be binding upon such acquirer and would remain in full force and effect, at least until the expiration of the then current Term.

Exclusion for Affiliate Transactions

A typical exclusion is one that allows a target company to assign a contract to an affiliate without needing the consent of the contract counterparty. This is much like an exclusion with respect to change of control, since in affiliate transfers or assignments, the ultimate actors and responsible parties under the contract remain essentially the same even though the nominal parties may change. For example:

Either party may assign its rights under this Agreement, including its right to receive payments hereunder, to a subsidiary, affiliate or any financial institution, but in such case the assigning party shall remain liable to the other party for the assigning party’s obligations hereunder. All or any portion of the rights and obligations of [Party A] under this Agreement may be transferred by [Party A] to any of its Affiliates without the consent of [Party B].

Assignment by Operation of Law

Assignments by operation of law typically occur in the context of transfers of rights and obligations in accordance with merger statutes and can be specifically included in or excluded from assignment provisions. An inclusion could be negotiated by the parties to broaden the anti-assignment clause and to ensure that an assignment occurring by operation of law requires counterparty approval:

[Party A] agrees that it will not assign, sublet or otherwise transfer its rights hereunder, either voluntarily or by operations of law, without the prior written consent of [Party B].

while an exclusion could be negotiated by a target company to make it clear that it has the right to assign the contract even though it might otherwise have that right as a matter of law:

This Guaranty shall be binding upon the successors and assigns of [Party A]; provided, that no transfer, assignment or delegation by [Party A], other than a transfer, assignment or delegation by operation of law, without the consent of [Party B], shall release [Party A] from its liabilities hereunder.

This helps settle any ambiguity regarding assignments and their effects under mergers statutes (particularly in forward triangular mergers and forward mergers since the target company ceases to exist upon consummation of the merger).

Direct or Indirect Assignment

More ambiguity can arise regarding which actions or transactions require a counterparty’s consent when assignment clauses prohibit both direct and indirect assignments without the consent of a counterparty. Transaction parties will typically choose to err on the side of over-inclusiveness in determining which contracts will require consent when dealing with material contracts. An example clause prohibiting direct or indirect assignment might be:

Except as provided hereunder or under the Merger Agreement, such Shareholder shall not, directly or indirectly, (i) transfer (which term shall include any sale, assignment, gift, pledge, hypothecation or other disposition), or consent to or permit any such transfer of, any or all of its Subject Shares, or any interest therein.

“Transfer” of Agreement vs. “Assignment” of Agreement

In some instances, assignment provisions prohibit “transfers” of agreements in addition to, or instead of, explicitly prohibiting “assignments”. Often, the word “transfer” is not defined in the agreement, in which case the governing law of the contract will determine the meaning of the term and whether prohibition on transfers are meant to prohibit a broader or narrower range of transactions than prohibitions on assignments. Note that the current jurisprudence on the meaning of an assignment is broader and deeper than it is on the meaning of a transfer. In the rarer case where “transfer” is defined, it might look like this:

As used in this Agreement, the term “transfer” includes the Franchisee’s voluntary, involuntary, direct or indirect assignment, sale, gift or other disposition of any interest in…

The examples listed above are only of five common occurrences in which an assignment provision may provide exclusions or inclusions. As you continue with due diligence review, you may find that assignment provisions offer greater variety beyond the factors discussed in this blog post. However, you now have a basic understand of the possible variations of assignment clauses. For a more in-depth discussion of reviewing change of control and assignment provisions in due diligence, please download our full guide on Reviewing Change of Control and Assignment Provisions in Due Diligence.

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no assignment clause meaning

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An assignment clause (AC) is an important part of many contracts, especially for real estate. In this article we discuss:

  • What is an Assignment Clause? (with Example)
  • Anti-Assignment Clauses (with Example)
  • Non-Assignment Clauses
  • Important Considerations
  • How Assets America ® Can Help

Frequently Asked Questions

What is an assignment clause.

An AC is part of a contract governing the sale of a property and other transactions. It deals with questions regarding the assignment of the property in the purchase agreement. The thrust of the assignment clause is that the buyer can rent, lease, repair, sell, or assign the property.

To “assign” simply means to hand off the benefits and obligations of a contract from one party to another. In short, it’s the transfer of contractual rights.

In-Depth Definition

Explicitly, an AC expresses the liabilities surrounding the assignment from the assignor to the assignee. The real estate contract assignment clause can take on two different forms, depending on the contract author:

  • The AC states that the assignor makes no representations or warranties about the property or the agreement. This makes the assignment “AS IS.”
  • The assignee won’t hold the assignor at fault. It protects the assignor from damages, liabilities, costs, claims, or other expenses stemming from the agreement.

The contract’s assignment clause states the “buyer and/or assigns.” In this clause, “assigns” is a noun that means assignees. It refers to anyone you choose to receive your property rights.

The assignment provision establishes the fact that the buyer (who is the assignor) can assign the property to an assignee. Upon assignment, the assignee becomes the new buyer.

The AC conveys to the assignee both the AC’s property rights and the AC’s contract obligations. After an assignment, the assignor is out of the picture.

What is a Lease Assignment?

Assignment Clause Example

This is an example of a real estate contract assignment clause :

“The Buyer reserves the right to assign this contract in whole or in part to any third party without further notice to the Seller; said assignment not to relieve the Buyer from his or her obligation to complete the terms and conditions of this contract should be assigning default.”

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Assignment provision.

An assignment provision is a separate clause that states the assignee’s acceptance of the contract assignment.

Assignment Provision Example

Here is an example of an assignment provision :

“Investor, as Assignee, hereby accepts the above and foregoing Assignment of Contract dated XXXX, XX, 20XX by and between Assignor and ____________________ (seller) and agrees to assume all of the obligations and perform all of the duties of Assignor under the Contract.”

Anti-Assignment Clauses & Non-Assignment Clauses

An anti-assignment clause prevents either party from assigning a contract without the permission of the other party. It typically does so by prohibiting payment for the assignment. A non-assignment clause is another name for an anti-assignment clause.

Anti-Assignment Clause Example

This is an anti-assignment clause example from the AIA Standard Form of Agreement:

” The Party 1 and Party 2, respectively, bind themselves, their partners, successors, assigns, and legal representatives to the other party to this Agreement and to the partners, successors, assigns, and legal representatives of such other party with respect to all covenants of this Agreement. Neither Party 1 nor Party 2 shall assign this Agreement without the written consent of the other.”

Important Considerations for Assignment Contracts

The presence of an AC triggers several important considerations.

Assignment Fee

In essence, the assignor is a broker that brings together a buyer and seller. As such, the assignor collects a fee for this service. Naturally, the assignor doesn’t incur the normal expenses of a buyer.

Rather, the new buyer assumes those expenses. In reality, the assignment fee replaces the fee the realtor or broker would charge in a normal transaction. Frequently, the assignment fee is less than a regular brokerage fee.

For example, compare a 2% assignment fee compared to a 6% brokerage fee. That’s a savings of $200,000 on a $5 million purchase price. Wholesalers are professionals who earn a living through assignments.

Frequently, the assignor will require that the assignee deposit the fee into escrow. Typically, the fee is not refundable, even if the assignee backs out of the deal after signing the assignment provision. In some cases, the assignee will fork over the fee directly to the assignor.

Assignor Intent

Just because the contract contains an AC does not obligate the buyer to assign the contract. The buyer remains the buyer unless it chooses to exercise the AC, at which point it becomes the assignor. It is up to the buyer to decide whether to go through with the purchase or assign the contract.

Nonetheless, the AC signals the seller of your possible intent to assign the purchase contract to someone else. For one thing, the seller might object if you try to assign the property without an AC.

You can have serious problems at closing if you show up with a surprise assignee. In fact, you could jeopardize the entire deal.

Another thing to consider is whether the buyer’s desire for an AC in the contract will frighten the seller. Perhaps the seller is very picky about the type of buyer to whom it will sell.

Or perhaps the seller has heard horror stories, real or fake, about assignments. Whatever the reason, the real estate contract assignment clause might put a possible deal in jeopardy.

Chain of Title

If you assign a property before the closing, you will not be in the chain of title. Obviously, this differs from the case in which you sell the property five minutes after buying it.

In the latter case, your name will appear in the chain of title twice, once as the buyer and again as the seller. In addition, the latter case would involve two sets of closing costs, whereas there would only one be for the assignment case. This includes back-to-back (or double) closings.

Enforceability

Assignment might not be enforceable in all situations, such as when:

  • State law or public policy prohibits it.
  • The contract prohibits it.
  • The assignment significantly changes the expectations of the seller. Those expectations can include decreasing the value of the property or increasing the risk of default.

Also note that REO (real estate owned) properties, HUD properties, and listed properties usually don’t permit assignment contracts. An REO property is real estate owned by a bank after foreclosure. Typically, these require a 90-day period before a property can be resold.

How Assets America Can Help

The AC is a portion of a purchase agreement. When a purchase involves a commercial property requiring a loan of $10 million or greater, Assets America ® can arrange your financing.

We can finance wholesalers who decide to go through with a purchase. Alternatively, we can finance assignees as well. In either case, we offer expedient, professional financing and many supporting services. Contact us today for a confidential consultation.

What rights can you assign despite a contract clause expressly prohibiting assignment?

Normally, a prohibition against assignment does not curb the right to receive payments due. However, circumstances may cause the opposite outcome. Additionally, prohibition doesn’t prevent the right to money that the contract specifies is due.

What is the purpose of an assignment of rents clause in a deed of trust and who benefits?

The assignment of rents clause is a provision in a mortgage or deed of trust. It gives the lender the right to collect rents from mortgaged properties if the borrower defaults. All incomes and rents from a secured property flow to the lender and offset the outstanding debt. Clearly, this benefits the lender.

What is in assignment clause in a health insurance contract?

Commonly, health insurance policies contain assignment of benefits (AOB) clauses. These clauses allow the insurer to pay benefits directly to health care providers instead of the patient. In some cases, the provider has the patient sign an assignment agreement that accomplishes the same outcome. The provider submits the AOB agreement along with the insurance claim.

What does “assignment clause” mean for liability insurance?

The clause would allow the assignment of proceeds from a liability award payable to a third party. However, the insured must consent to the clause or else it isn’t binding. This restriction applies only before a loss. After a first party loss, the insurer’s consent no longer matters.

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Ronny was a pleasure to work with and is extremely knowledgeable. His hard work was never ending until the job was done. They handled a complex lease and guided us through entire process, including the paperwork. Not to mention a below market lease rate and more than all the features we needed in a site. We later used Assets America for a unique equipment financing deal where once again Ronny and team exceeded our expectations and our timeline. Thank you to Assets America for your highly professional service!

Great experience with Assets America. Fast turn around. Had a lender in place in 30 minutes looking to do the deal. Totally amazing. Highly recommend them to anyone looking for financing. Ronny is fantastic. Give them a call if the deal makes sense they can get it funded. Referring all our clients.

Assets America guided us every step of the way in finding and leasing our large industrial building with attached offices. They handled all of the complex lease negotiations and contractual paperwork. Ultimately, we received exactly the space we needed along with a lower than market per square foot pricing, lease length and end of term options we requested. In addition to the real estate lease, Assets America utilized their decades-long financial expertise to negotiate fantastic rates and terms on our large and very unique multimillion dollar equipment purchase/lease. We were thankful for how promptly and consistently they kept us informed and up to date on each step of our journey. They were always available to answer each and every one of our questions. Overall, they provided my team with a fantastic and highly professional service!

Assets America was responsible for arranging financing for two of my multi million dollar commercial projects. At the time of financing, it was extremely difficult to obtain bank financing for commercial real estate. Not only was Assets America successful, they were able to obtain an interest rate lower than going rates. The company is very capable, I would recommend Assets America to any company requiring commercial financing.

Assets America was incredibly helpful and professional in assisting us in purchasing our property. It was great to have such knowledgeable and super-experienced, licensed pros in our corner, pros upon which we could fully rely. They helped and successfully guided us to beat out 9 other competing offers! They were excellent at communicating with us at all times and they were extremely responsive. Having them on our team meant that we could always receive truthful, timely and accurate answers to our questions. We would most definitely utilize their services again and again for all of our real estate needs.

Assets America is a great company to work with. No hassles. Recommend them to everyone. Professional, fast response time and definitely gets the job done.

Ronny at Assets America has been invaluable to us and definitely is tops in his field. Great experience. Would refer them to all our business associates.

We were very pleased with Assets America’s expertise and prompt response to our inquiry. They were very straight forward with us and helped a great deal. We referred them to all our business associates.

I’ve worked with this company for decades. They are reputable, knowledgeable, and ethical with proven results. I highly recommend them to anyone needing commercial financing.

Ronny was incredibly adept and responsive – top-notch professional who arranged impressive term sheets.

Assets America helped us survive a very difficult time and we most definitely give them 5 stars!

Ronny was very friendly and though we were unable to make something happen at the moment he gave me some direction to go.

My business partner and I were looking to purchase a retail shopping center in southern California.  We sought out the services of Ronny, CFO of Assets America.  Ronny found us several commercial properties which met our desired needs.  We chose the property we liked best, and Ronny went to work. He negotiated very aggressively on our behalf. We came to terms with the Seller, entered into a purchase agreement and opened escrow.  Additionally, we needed 80 percent financing on our multimillion-dollar purchase.  Assets America also handled the commercial loan for us.  They were our One-Stop-Shop. They obtained fantastic, low, fixed rate insurance money for us.  So, Assets America handled both the sale and the loan for us and successfully closed our escrow within the time frame stated in the purchase agreement.  Ronny did and performed exactly as he said he would. Ronny and his company are true professionals.  In this day and age, it’s especially rare and wonderful to work with a person who actually does what he says he will do.  We recommend them to anyone needing any type of commercial real estate transaction and we further highly recommend them for any type of commercial financing.  They were diligent and forthright on both accounts and brought our deal to a successful closing.

Questionnaire

No assignment or delegation

No assignment or delegation clause samples

14.6     No Assignment or Delegation. No party may assign any right or delegate any obligation hereunder, including by merger, consolidation, operation of law, or otherwise, without the written consent of the other parties hereto; provided, that such assignment shall not prevent or impede the Acquisition Merger from qualifying for the Intended Tax Treatment. Any purported assignment or delegation that does not comply with the immediately preceding sentence shall be void, in addition to constituting a material breach of this Agreement.

09/10/2020 (Chelsea Worldwide Inc.)

Section 5.12 No Assignment or Delegation. No Party may assign any right or delegate any obligation hereunder, including by merger, consolidation, operation of law, or otherwise, without the written consent of the all of the other Parties and any purported assignment or delegation without such consent shall be void, in addition to constituting a material breach of this Agreement. This Agreement shall be binding on the permitted successors and assigns of the Parties.

11/01/2019 (Lone Star Value Management LLC)

Section9. Binding Effect; No Assignment or Delegation. This Pledge Agreement shall be binding upon and inure to the benefit of the Pledgor, the Pledgee and their respective successors and assigns, except that the Pledgor may not assign or transfer its rights hereunder without the prior written consent of the Pledgee (which consent shall not unreasonably be withheld). Each duty or obligation of the Pledgor to the Pledgee pursuant to the provisions of this Pledge Agreement shall be performed in favor of any person or entity designated by the Pledgee, and any duty or obligation of the Pledgee to the Pledgor may be performed by any other person or entity designated by the Pledgee.

06/06/2016 (Ottawa Bancorp Inc)

Section 10.16 No Assignment or Delegation. No Party may assign any right or delegate any obligation hereunder, including by merger, consolidation, operation of law, or otherwise, without the written consent of the all of the other Parties and any purported assignment or delegation without such consent shall be void, in addition to constituting a material breach of this Agreement. Notwithstanding this restriction, the Buyer may assign this Agreement to an affiliate that effectuates the Roll-Up Transactions (the “Permitted Assignee”). In the event of any assignment to the Permitted Assignee, the capitalization of the Assignee shall be identical to the capitalization of the Buyer as provided for in this Agreement (only with such changes as are not adverse to the Sellers and do not diminish any rights to which the Sellers were otherwise entitled) and all other representations and warranties of the Buyer shall be true and correct as they apply to the Permitted Assignee, and the Buyer shall continue to be bound by the terms of this Agreement as a primary obligor hereunder such that should the Permitted Assignee fail to perform any of its obligations hereunder, the Sellers and Sellers’ Representative shall be entitled to pursue performance against the Buyer. This Agreement shall be binding on the permitted successors and assigns of the Parties; provided, however, no such assignment will relieve any Party of their obligations under this Agreement.

11/05/2020 (HARVEST HEALTH & RECREATION INC.)

no assignment clause meaning

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no assignment clause meaning

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  • Practical Law

If a contract is silent on assignment does the law imply that the assignment can only take place with consent?

Practical law resource id a-014-2191  (approx. 3 pages).

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IMAGES

  1. Wholesaling Real Estate

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  2. Anti-assignment Clauses and Limitations

    no assignment clause meaning

  3. Are Non-Assignment Clauses in Insurance Policies Enforceable?

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  4. No Assignment Policy

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  5. No Assignment Policy

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  6. Wholesaling Real Estate

    no assignment clause meaning

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COMMENTS

  1. Assignment Clause: Meaning & Samples (2022)

    Assignment clauses are legally binding provisions in contracts that give a party the chance to engage in a transfer of ownership or assign their contractual obligations and rights to a different contracting party. In other words, an assignment clause can reassign contracts to another party.

  2. Are Anti-Assignment Clauses Enforceable?

    Anti-assignment clauses—also sometimes referred to as assignment clauses or non-assignment clauses—can appear in various forms. Essentially, they prevent one or both contracting parties from assigning some or all of their respective contractual obligations or rights to a third party. Anti-Assignment Language to Look for in a Contract

  3. Anti-Assignment Clause: Everything You Need To Know

    An anti-assignment clause prevents either of the parties to a contract from assigning tasks to a third party without the consent of the non-assigning party. Anti-assignment clauses are of two types: One that prohibits the assignment of work or service pursuant to the contract. One that prohibits the assignment of payment under the contract.

  4. Beware of Non-Assignment Clauses

    For purposes of this Agreement, the term "assignment" shall, in addition to the transfer of this Agreement or the rights or obligations thereunder, whether voluntarily, involuntarily, by operation of law, or otherwise, be deemed to include (i) a sale or other transfer by Party B of all or substantially all of its assets; (ii) the merger, amalgam...

  5. Rethinking the "No Assignment" Provision

    Rethinking the "No Assignment" Provision 20 November 2012 | Ken Adams In this post, Brian Rogers explains how, as an experiment in crowdsourcing contract language, he has posted on Quora ( here) his candidate for "the best anti-assignment provision in a contract ever."

  6. No Assignment Contract Clause Examples

    View Examples No Assignment. Executive's rights to receive benefits under this Agreement shall not be assignable or transferable whether by pledge, creation of a security interest, or otherwise, other than a transfer by will or by the laws of descent or distribution.

  7. Examples of no assignment clauses in contracts

    17.No Assignment.The Employee represents and warrants that Employee has made no assignment, and will make no assignment, of any claim, action, or right of any kind whatsoever, embodied in any of the matters referred to in this Agreement, and that no person or entity of any kind had or has any interest in any of the demands, obligations, actions, claims, debts, liabilities, rights, contracts ...

  8. No Assignment Sample Clauses: 26k Samples

    Cite No Assignment. This Agreement may not be assigned by any Party hereto except with the prior written consent of the other Parties. Sample 1 Sample 2 Sample 3 See All ( 348) No Assignment.

  9. Non-Assignment Sample Clauses: 5k Samples

    Cite Non-Assignment. This Agreement shall not be assigned by either party without the written consent of the other party. Sample 1 Sample 2 Sample 3 See All ( 170) Non-Assignment.

  10. PDF The nature of assignment and non- assignment clauses

    What effect does assignment have on the contract cr eating the right? Before we turn to non-assignment clauses, the character of assignment, particularly its relation to contract, needs to be explored. A wide variety of rights may be made the subject of an assignment but the concern of this article is with contract rights and debts. 7

  11. Assignability Of Contracts: Everything You Need to Know

    A clause in the contract prohibits assignment. This is usually called an anti-assignment clause. Assignments can't take place if they materially alter what's expected under the contract.

  12. What Is an Assignment of Contract?

    An assignment of contract occurs when one party to an existing contract (the "assignor") hands off the contract's obligations and benefits to another party (the "assignee"). Ideally, the assignor wants the assignee to step into his shoes and assume all of his contractual obligations and rights. In order to do that, the other party to the ...

  13. Non-Assignability of Contracts Without Counterparty Consent

    Non-assignment provisions are designed so that contracts cannot be as freely assigned to third parties; or at least, not without first obtaining the contracting counterparty's consent.

  14. Sublet and Assignment Clauses in Commercial Leases

    By contrast, an "assignment" occurs when you transfer all of your space to someone else (called an "assignee") for the entire remaining term of the lease. As you are with a sublet, you're free to choose your assignee and determine the rent unless your lease says otherwise. In an assignment, the new tenant pays rent directly to the landlord.

  15. What Is an Assignment Clause?

    To keep all doubts at bay, no consent is required for an assignment — including collateral, absolute, or other — for a contractual right to payment. These are the takeaways from these stipulations: This type of requirement for an assignment clause can create obstacles for the non-assigning party in corporate reorganizations or future mergers.

  16. United States: When Is An "Assignment" Clause Worth Fighting For?

    An assignment clause spells out which, if any, of a party's obligations and rights under a contract are able to be assigned, or transferred, to another party. Free assignability and no assignability are not the only options, and you and your vendor can negotiate terms for assignment that are amenable to both of you.

  17. Contract: non-assignment clause

    In Ruttle Plant Hire v Secretary of State for the Environment & Rural Affairs, in a determination of preliminary issues, the High Court held that a clause prohibiting the assignment of a services contract meant that the assignee could not pursue claims in relation to the contract.

  18. Spotting issues with assignment clauses in M&A Due Diligence

    This is why reviewing contracts for assignment clauses is so critical. A simple anti-assignment provision provides that a party may not assign the agreement without the consent of the other party. Assignment provisions may also provide specific exclusions or inclusions to a counterparty's right to consent to the assignment of a contract ...

  19. How Is a Contract Assigned?

    Step 2: Execute an assignment. If you are not prohibited from assigning the contract, prepare and enter into an assignment of contract: an agreement that transfers the parties' rights and obligations. Step 3: Provide notice to the obligor. After you have assigned your contract rights to the assignee, you should provide notice to the other ...

  20. Assignment Clause

    To "assign" simply means to hand off the benefits and obligations of a contract from one party to another. In short, it's the transfer of contractual rights. In-Depth Definition Explicitly, an AC expresses the liabilities surrounding the assignment from the assignor to the assignee.

  21. Don't Confuse Change of Control and Assignment Terms

    An assignment clause governs whether and when a party can transfer the contract to someone else. Often, it covers what happens in a change of control: whether a party can assign the contract to its buyer if it gets merged into a company or completely bought out. But that doesn't make it a change of control clause.

  22. Examples of no assignment or delegation clauses in contracts

    No Party may assign any right or delegate any obligation hereunder, including by merger, consolidation, operation of law, or otherwise, without the written consent of the all of the other Parties and any purported assignment or delegation without such consent shall be void, in addition to constituting a material breach of this Agreement.

  23. If a contract is silent on assignment does the law imply that the

    Where a contract is silent on assignment and transferability, i.e. there is no assignment and transfer provision, am I right that in my understanding that, under English law, the parties are deemed to have an unfettered right to assign and transfer their rights and obligations under the contract to a third party without having the need to obtain...