Tacking an Acknowledgment on to the End of a Contract

You sometimes see a contract that has a paragraph entitled “Acknowledgement” added at the end, after the party signatures.

For example, a search on the SEC’s EDGAR system quickly retrieved this document, a “forebearance agreement and amendment to indenture” between Gulfstream International Group, Inc. and Shelter Island Opportunity Fund, LLC. Here’s what came after their signature blocks:

ACKNOWLEDGMENT AND AGREEMENT OF GUARANTORS The undersigned, each a guarantor of the indebtedness of Gulfstream International Group, Inc., a Delaware corporation ( Company ) to Shelter Island Opportunity Fund, LLC ( Holder ), pursuant to the separate Guaranty of each dated as of August 21, 2008 (each, as amended from time to time, a Guaranty ), hereby (i) acknowledges receipt of the foregoing Forbearance Agreement and Amendment to Securities Purchase Agreement and Debenture (the Agreement ); (ii) consents to the terms and execution thereof; (iii) reaffirms all obligations to Holder pursuant to the terms of the Guaranty; and (iv) acknowledges that Holder may amend, restate, extend, renew or otherwise modify the Transaction Documents and any indebtedness or agreement of Company, or enter into any agreement or extend additional or other credit accommodations, without notifying or obtaining the consent of the undersigned and without impairing the liability of the undersigned under the Guaranty for all of Companys present and future indebtedness to Holder.

[Signature blocks omitted.]

I haven’t previously given any thought to the practice of tacking acknowledgements on to the end of a contract. I invite you to suggest whether or not that practice makes sense and, if it does, when it’s appropriate to use it.

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.