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Difference between revisions of "Commercial Tenancies (19:XIV)"
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Commercial Tenancies (19:XIV) (view source)
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=== 2. Rent Acceleration === | === 2. Rent Acceleration === | ||
An | An agreement may contain a clause for rent acceleration. Rent is usually accelerated by 3 months, meaning for example that if you owe one month’s rent of $2,000, at the end of tenancy that becomes $6,000. | ||
=== 3. Bankruptcy and Insolvency === | === 3. Bankruptcy and Insolvency === | ||
A | A trustee in bankruptcy can take over for a tenant and break the lease with fewer penalties than the tenant. | ||
=== 4. Personal Liabilities === | === 4. Personal Liabilities === | ||
If a personal guarantee is included in the lease agreement, the tenant will be | If a personal guarantee is included in the lease agreement, the tenant will be held personally responsible for monies owed when their company is insolvent. However, personal guarantees do not necessarily require a determination of insolvency in order to obligate a tenant. | ||
Also, | Also, there are issues for a guarantor and a covenantor regarding when liability accrues. Sometimes the guarantor is made a party to the lease (as one of the tenants), as well. | ||
