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Commercial Lease Agreements
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Flashcards
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Termination and Default
Details what constitutes a breach of the lease and the remedies available to the aggrieved party.
Insurance
Specifies the types and amounts of insurance the tenant must carry. Protects both parties financially in case of damage or liability.
Force Majeure
Frees both parties from liability or obligation when an extraordinary event or circumstance beyond their control occurs.
Security Deposit
A monetary deposit held by the landlord for tenant default. Governed by state laws which dictate the maximum that can be charged and the return process.
Rent
Outlines payment amounts, frequency, and methods. Late or unpaid rent can lead to penalties or termination of the lease.
Option to Purchase
Gives the tenant the right to buy the property under specific conditions, which can be a future financial benefit.
Dispute Resolution
Establishes the process for handling legal disagreements, which may include arbitration or litigation.
Use of Premises
Defines what activities tenants are permitted to conduct on the property, which can prevent illegal or unwanted uses.
Alterations and Improvements
Conditions under which tenants can alter or improve the leased space. Usually requires landlord's consent.
Maintenance and Repairs
Details the responsibilities of tenants and landlords in maintaining the property. Non-compliance can lead to legal disputes.
Term of Lease
Specifies the duration of the lease agreement, often including options for renewal. Failure to comply can lead to eviction.
Renewal Options
Gives the tenant the right to extend the lease under predetermined conditions, providing stability for the tenant's business.
Exclusivity Clause
Prevents the landlord from leasing nearby premises to direct competitors of the tenant, serving as a business protection measure.
Sublease and Assignment
Describes conditions under which the tenant can rent out the space or transfer the lease to another party. Often requires landlord approval.
Compliance with Laws
Requires the tenant to adhere to all local, state, and federal regulations, which guards the landlord against legal liability.
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