The Rent Guarantee Agreement serves as a critical security instrument in Indonesian property transactions, providing landlords with additional protection against tenant default. This document is typically used when a landlord requires extra security beyond the standard lease deposit, or when a tenant's financial standing necessitates additional assurance. The agreement must comply with Indonesian Civil Code (KUHPerdata) requirements for guarantees and property law, including specific provisions for witness signatures and notarization where required. The document outlines the guarantor's obligations, enforcement procedures, and the scope of the guarantee, making it essential for both commercial and residential property transactions where enhanced tenant security is needed.
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1. Parties: Identifies and provides full details of the Landlord, Tenant, and Guarantor including their legal names, addresses, and registration numbers if applicable
2. Background: Explains the context of the agreement, referring to the main lease agreement and the need for a guarantee
3. Definitions: Defines key terms used throughout the agreement including 'Lease Agreement', 'Guaranteed Obligations', 'Property', etc.
4. Scope of Guarantee: Details the extent of the guarantee and specific obligations being guaranteed
5. Guarantor's Obligations: Specifies the guarantor's primary obligations and commitments
6. Duration of Guarantee: Establishes the time period for which the guarantee remains valid
7. Payment Terms: Outlines when and how the guarantor must make payments upon default by the tenant
8. Enforcement: Describes the process for enforcing the guarantee and the landlord's rights
9. Representations and Warranties: Contains statements of fact and promises made by the guarantor
10. Notices: Specifies how formal communications between parties should be made
11. Governing Law and Jurisdiction: Confirms Indonesian law as governing law and specifies jurisdiction for disputes
12. Execution: Signature blocks and execution formalities
1. Multiple Properties: Include when the guarantee covers multiple rental properties
2. Foreign Party Provisions: Include when any party is not Indonesian, addressing specific requirements under Indonesian law
3. Corporate Guarantor Provisions: Include when the guarantor is a company rather than an individual
4. Bank Guarantee Options: Include when allowing for bank guarantee as an alternative to personal/corporate guarantee
5. Step-In Rights: Include when the guarantor has the right to take over the lease instead of making payments
6. Currency Provisions: Include when payments may be made in foreign currency
1. Schedule 1 - Property Details: Detailed description of the rental property including address and specific features
2. Schedule 2 - Main Lease Terms: Key terms from the main lease agreement that are relevant to the guarantee
3. Schedule 3 - Guarantee Amount: Specific details of the guarantee amount and any calculation methods
4. Schedule 4 - Payment Procedures: Detailed procedures for making guarantee payments
5. Appendix A - Form of Demand: Template for the landlord to make a formal demand under the guarantee
6. Appendix B - Required Documents: List of documents required for guarantee enforcement
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