Financing Payment Obligations for Services: Are 'Hell or High Water' and 'Waiver of Defenses' Clauses Enforceable in Contracts for Future Services?
February 27, 2007
The primordial cornerstone of financing equipment lease receivables has been the ability of funding sources to rely on the enforceability of two related provisions contained in the underlying lease documentation:1) 'Hell or high water' clauses, where the lessee agrees that its payment obligations under the lease are 'absolute and unconditional' and are not subject to any defense, setoff, or counterclaim that the lessee may have against the lessor, its assignee, the manufacturer or seller of the equipment, or against any person for any reason whatsoever — essentially, it agrees to pay 'come hell or high water.'2) 'Waiver of defense' clauses, where the lessee 'agrees not to assert against an assignee' of the lease payments, any defenses, setoffs, or claims it may have against the lessor, as the original payee under the lease.
An Overview of the New FTC Rule
February 27, 2007
On Jan. 22, 2007, after more than a decade of study, the FTC released its long-anticipated new Federal Trade Commission Rule on Franchising. This article outlines the key elements of the New Rule. The New Rule changes the coverage of the existing FTC Rule.
The Leasing Hotline
February 27, 2007
Highlights of the latest commercial leasing cases from around the country.
Which Endorsements Are Right for Your Transaction?
February 27, 2007
A commercial real estate attorney representing a client that needs title insurance in a commercial real estate transaction must consider which endorsements would be best to provide the client with all the necessary title insurance protection. This two-part article addresses which American Land Title Association ('ALTA') endorsements are typical when representing a buyer, tenant, or lender in an acquisition or lease of commercial property. In addition, the article discusses a few non-ALTA endorsements that are available in many states.
In the Spotlight: Planning for Redevelopment
February 27, 2007
For years, the commercial real estate market has been sizzling.Cap rates are down. Prices are up.Nevertheless, you managed to beat out the competition and buy a few shopping centers. To justify the price you paid, however, you need to increase the net operating income ('NOI') from your property. Now, however, the economy may be facing the headwind of a slowdown, if not an outright recession, which creates resistance to rent increases; so you may not be able to rely on ordinary rent increases to bolster your NOI.
Dealing with the Risk of Events of Force Majeure
February 27, 2007
Force majeure clauses are used in leases to extend the date upon which a party's performance of an obligation is due. Often such obligations pertain to the delivery of the building and/or leased premises. This article explains and discusses sample force majeure clauses and suggests ways to protect the party not claiming a delay caused by an event of force majeure.
Powerhouse Industry Firm Divorces
February 27, 2007
Marshall Grossman and Stanton 'Larry' Stein may be in for some awkward elevator rides. The two heavyweights at L.A.'s Alschuler Grossman Stein & Kahan officially divorced Jan. 1, after a year-long tug-of-war over the future of the 90-lawyer firm they'd fused together seven years ago. Now they've got their own firms, but they're just one floor away in Santa Monica's Water Garden building.
