Real estate practitioners are frequently asked to opine on whether particular corporate transactions violate lease provisions that are intended to restrict assignments and changes in control of the tenant. Typically, parties are permitted to freely transfer contractual rights without obtaining permission from their counterparties. However, leases commonly contain provisions restricting assignment, subletting and changes in control. These restrictions will be enforced, but will be construed as restraints on alienation which are to be narrowly construed.
Absent specific provisions restricting stock transactions or mergers, courts generally will not interpret common anti-assignment provisions as prohibiting the transfer of equity interests in either the entity burdened by the provision or any parent entities.
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