Property Management
A Texas commercial property manager signs a lease with a new tenant. The lease contains a 'personal guarantee' clause. This means:
AThe property manager personally guarantees the tenant's performance
BThe individual signing on behalf of the tenant personally guarantees the lease obligations, making them individually liable✓ Correct
CThe property owner personally guarantees to maintain the property
DTREC guarantees the lease terms are legally compliant
Explanation
A personal guarantee in a commercial lease requires an individual (typically a business owner or officer) to personally guarantee the entity-tenant's lease obligations. If the business fails to pay rent, the guarantor is personally liable. Personal guarantees are commonly required for new or small businesses that lack established credit.
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