Subtenant Recognition Agreement
In certain circumstances, it may be appropriate for the subcontractor to request a recognition agreement from the Oberherrn. Overland advisor recognition protection works in the same way as a mortgage borrower`s non-disruption agreement. An acknowledgment agreement provides that, where the underlying lease is terminated due to the Sublandlord`s breaches, the Overlandlord «acknowledges and does not disturb» the subtenant`s ownership of the premises, provided that the subtenant is not late in his sublease. An important difference between a non-disruption agreement granted by a mortgage borrower and a recognition agreement granted by an overlandlord agreement is that, in the latter case, the parties must decide whether the recognition agreement is based on the terms set out in the sublease (including rent) or, as the Overlandlord will likely prefer, on the terms of the underlying lease. While there is no way to completely reduce this risk of subordination, the subgroup may take certain measures that provide partial protection. While it is always advisable to perform due diligence with a party with whom you wish to enter into a contract, it is especially important to do so before entering into a sublease agreement. .