A good guy clause limits the liability of the personal guarantor for a tenant when a lease is terminated early. If the tenant defaults on the lease but is current on rent payments and surrenders the property in good condition, payment will not be sought from the guarantor. It provides that the landlord will not enforce the personal guaranty as long as the tenant has vacated the premises and has paid all rent up to the date of termination.
The following is an example of a good guy clause:
Notwithstanding anything herein to the contrary, Guarantor's obligations herein shall only be applicable with respect to period prior to such time as Owner obtains vacant, unencumbered possession of the Demised Premises, free and clear of all tenants, subtenants and occupants.
The reason that the LL might accept this is that it may be hopeless to pursue the tenant for its personal guaranteee and getting the space back in good shape, with everything paid to date of vacating may be worth more to the LL than a hope to recover damages for the remainder of the lease.
I hope this helps... Good luck Damon...
Rob Baird, CA RE License #544165 (One of the oldest, active licenses in CA) 951 515-5855 Email: email@example.com
Nov 22, 2010