Tuesday, December 11, 2018, 1:00-2:00pm
Guarantees undergird most real estate transactions.
Lenders, investors and others are often unwilling to finance or otherwise support a real estate transaction without certain substantial guarantees. These guarantees may concern repayment of loan proceeds or cover a host of other performance benchmarks – construction, maintenance and waste prevention, environmental indemnity or something else. The scope of guarantees is highly negotiated, particularly whether the guarantee is recourse or non-recourse and the scope of carve-outs from the guarantees.
This program provides a practical guide to negotiating and drafting guarantees in real estate transactions.
- Types of guarantees – payment, performance, collection, completion
- Essential elements of a guarantee – consideration, scope, carve-outs, waivers
- Guarantees for property maintenance/no waste, environmental indemnity and other non-financial concerns
- Carve-outs – full v. partial, fraud, misappropriation, misapplication, failure to maintain, insurance, and more
- Special Purpose Entity issues – debt, solvency, separateness
Guarantees of construction loans
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