Landlords: Tips When Taking a Lease Guaranty from a Foreign Company

Landlords: Tips When Taking a Lease Guaranty from a Foreign Company

When a landlord leases to a U.S. company affiliated with a foreign company, whether a parent company or sister company, the landlord’s being able to collect on a lease guaranty from the foreign company can be tricky.  Before deciding about the guaranty, consider:

  • Obtaining detailed financial and corporate information on the guarantor

  • Determining who at the foreign company is authorized to execute the guaranty and have the signature authenticated from the guarantor’s foreign country

  • Whether the guarantor has any assets in the U.S.

  • If the foreign company’s principal(s) will also guaranty the lease

  • Requiring the guarantor submit to the landlord’s venue, U.S. laws and jurisdiction

  • How notice and service of a lawsuit will occur upon any default

  • How the landlord will collect the judgment, including whether the judgment will be recognized in the guarantor’s foreign jurisdiction

  • Requiring the guarantor provide collateral here in the U.S. (e.g. letter of credit)

Above all else, keep forefront in the documentation of the guaranty how to enforce the landlord’s rights.

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Information contained in this Memo is intended for informational and educational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.  It is likely considered advertising.  Epps & Coulson, LLP encourages you to call to discuss these matters as they apply to you or your business.  Epps & Coulson, LLP has affiliated Counsel offices in New York and Connecticut with lawyers also admitted in Connecticut, District of Columbia Massachusetts (pending), New Jersey, Hawaii, European Union, England and Whales, France (Paris Bar) and Sweden.

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