Joined: 11/April/2012
Location: Australia
Posts: 15
QuoteReplyTopic: Retail lease - change of lessee Posted: 30/May/2012 at 17:05
Hi,
If there is change of shareholders of lessee, the bond will be increased from original amount. There is term in the Lear stating the topping up band guarantee if there is a change of shareholders in lessee. Could anyone advise under which clause is this stated? Thank you!
Commonly in Commercial Leases, if the Lessee is a Company a change of shareholding in the lessee comapny that alters control (usually 50% or more) it is classed as a 'deemed assignment' of the Lease and the Lessee will have to get consent form the landlord to transfer the shares.
Some leases have conditions that allow the Landlord to request other things such as bank or personal guaruntees/bonds, financial information etc from the new shareholder/s before they grant the consent.
As mentioned above, it all depends what is in your particular lease as they can be quite different. You will have to read through it carefully to see what the Landlord is able to do upon a request to change the shareholding in a Lessee Co.
Thank you. I found the clause as below-if the lessee wishes to assign the lease, the lessee must have the assignee provide such personal guarantees and such other security (including a bank guarantee equivalent to not less than six months '. Rent plus gst) as is satisfactory to the lessor before the lessor is required to consent to that assignment.
This looks in line with what you advised, it this the right clause to apply to the situation if there is a new director joins the company of lessee?it has to be more than or equal to fifty percent of shares to be applicable?
So the lessor can ask for both personal and bank guarantee to be topped up to six months rent? Is that the case?
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