Alabama § 7-9A-904 - Requirements for Assignee and Assignment Agreement.

§ 7-9A-904. Requirements for Assignee and Assignment Agreement.

(a) An assignee must be a person that:

(1) Is not a creditor, affiliate, or insider of the assignor;

(2) Is not an affiliate or insider of a creditor of the assignor;

(3) Does not have a claim against the assignment estate, other than a claim for fees and expenses to be paid under the assignment agreement;

(4) Does not have a material financial interest in the outcome of the assignment, other than fees and expenses to be paid under the assignment agreement;

(5) Does not hold an equity interest in the assignor other than a noncontrolling interest in a publicly traded company; and

(6) Is not an affiliate of a person that fails to satisfy subdivision (1), (2), (3), (4), or (5).

(b) A person that satisfies subsection (a) is not precluded from being an assignee merely because the person performed services for the assignor before the assignment.

(c) An assignment agreement must be in a record signed by the assignee and the assignor. The record must:

(1) State the name and address of the assignor and of the assignee;

(2) Transfer or provide for a transfer of all the assignor’s assets;

(3) Describe the assigned assets in sufficient detail to identify the assets;

(4) Provide for the distribution of the assignment estate;

(5) Describe the fees to be charged by the assignee in connection with the assignment, including the basis on which they are to be calculated; and

(6) Include a representation by the assignor, under penalty of perjury, that the assignor is assigning all the assignor’s assets.

(d) If an assignee relies in good faith on the assignor’s representation made under subdivision (c)(6), all the assignor’s assets are deemed to be assigned, even if the representation is inaccurate.