# Asset Sale

> the disposal by the Company of all or substantially all of its undertaking and assets (where disposal may include, without limitation, the grant by

**Term:** Asset Sale  
**Last updated:** 2026-07-29

## Definition

## What Asset Sale Means in a Contract

An asset sale, as a defined term in a contract, refers to the disposal by a company of all or substantially all of its undertaking and assets. This is distinct from a share sale, where ownership of the company itself changes hands while the company continues to hold its assets and liabilities. In an asset sale, the buyer selects and acquires specific assets, such as equipment, contracts, real property, and intellectual property, while the selling entity remains a separate legal person that may continue to exist, wind down, or be dissolved after completion.

The definition typically extends beyond straightforward transfers of title. Many drafters make clear that an asset sale includes the grant of an exclusive licence over intellectual property when that licence is not entered into in the ordinary course of business. This broader framing matters because an exclusive licence can strip a business of the practical value of an asset even though legal title never changes hands, so treating it as equivalent to a disposal closes an obvious gap.

Understanding this term correctly is essential when reviewing warranties, restrictive covenants, change of control clauses, or consent requirements that are triggered by a disposal of substantially all assets. Getting the scope wrong can mean a transaction slips through a contractual restriction that was designed to catch exactly that kind of event.

## How Asset Sale Is Defined or Measured

The core measurement question is what counts as.

## Context

### Relevant circumstances

- When the company sells substantially all of its business and assets
- If exclusive IP licences outside the ordinary course are treated as asset sales
- Where consent or preference rights are triggered by an asset disposal

### Relevant sectors

- Real Estate
- M&A
- IP & Licensing

## Relevant contract types

- [Bill of Sale](https://www.genieai.co/en-us/template-type/bill-of-sale)
- [Deed of Sale](https://www.genieai.co/en-us/template-type/deed-of-sale)
- [Memorandum of Sale](https://www.genieai.co/en-us/template-type/memorandum-of-sale)

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