This form provides boilerplate contract clauses that give further assurances and pre-closing assurances to the various parties of the contract agreement. Several different language options are included to suit individual needs and circumstances.
Rhode Island Negotiating and Drafting Further Assurances and Pre-Closing Assurances Provisions
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A good example of this is with an automobile dealership selling a car that requires financing. The dealer's covenant of assurance to the finance company is the assurance the title is perfected by filling out the proper paperwork reflecting the finance company having a lien against the car as collateral for the loan.
A standard boilerplate clause, in which the parties agree to cooperate with one another to take any actions not expressly specified in the agreement to carry out the intent of the agreement or implement its provisions.
A covenant of further assurances is the related promise that the grantor will do whatever is necessary to remove a defect associated with title, such as an encumbrance, if it arises, and if the problem is not fixed, damages will be awarded.
If one party learns that the other is facing financial trouble, for example, the further assurances clause allows them to request assurances from the party in question to prove that no financial problems actually exist. A further assurance clause may appear in a number of different places within a contract.
This clause provides a buyer with the assurance that their right to possess the property won't be negatively impacted by any legal claims made against the property by a third party.
Further assurance clauses are intended to create legal obligations requiring one or more of the parties to a contract to commit to do unspecified acts to reassure the other party will do what is reasonable or necessary to bring home the full benefit of the contract.
A further assurances clause is used to evidence the agreement of the contracting parties to do everything necessary to complete the transactions contemplated by the contract.
By Practical Law Commercial. A boilerplate further assurance clause that seeks to ensure that the parties carry out any additional acts necessary to give effect to the contract, including the procuring of such acts by third parties.