Due Diligence & Legal
Change of Control Consent
A third-party contractual right requiring a customer, lender, landlord, or licensor's consent before a target's ownership change, absent which the underlying contract may terminate or default.
Buyer Example
Buyer acquiring a Chandigarh IT services company discovers its largest client contract (30% of revenue) contains a change-of-control clause allowing termination on 30 days' notice. Buyer makes obtaining the client's written consent a hard condition precedent to closing, refusing to close and release funds until that consent is secured in writing.