Exhibits

Definition

Exhibits are attachments to leases, mortgages, and other legal documents that provide additional, detailed, and supplementary information pertinent to the main document. These exhibits ensure that both parties to a contract have access to all necessary information and that all legal obligations are clearly defined.

Examples

Here are some common types of exhibits that might be attached to a real estate lease:

Exhibit A: Legal Description - Describes the precise geographical boundaries and layout of the property.
Exhibit B: Covenant of Operations - Details any specific operations, usage rules, or requirements applicable to the property.
Exhibit C: Cotenancy Agreements - Specifies agreements between tenants sharing the same property.
Exhibit D: Purchase Option - Outlines terms under which the lessee may have the right to purchase the property.

Frequently Asked Questions

1. What is the purpose of exhibits in a lease?

Exhibits provide detailed information that supplements the lease, ensuring that all terms, obligations, and details are clearly communicated.

2. Can exhibits to a lease be changed after signing?

Amendments to exhibits can be made, but typically require the consent of both parties and must be documented properly.

3. Who prepares the exhibits?

Exhibits are usually prepared by attorneys or legal professionals to ensure their accuracy and legal validity.

4. Are exhibits legally binding?

Yes, exhibits are legally binding as they are part of the lease agreement or other legal document they supplement.

5. What should I do if I don’t understand an exhibit?

Always seek clarification from a legal professional if you do not understand any part of an exhibit before signing any document.

Lease - A contract by which one party conveys property to another for a specified time, usually in return for periodic payment.
Addendum - An additional document added to a lease or contract to modify, clarify, or add terms.
Rider - A detailed amendment added to a standard lease or contract to further specify conditions and obligations.
Attachment - Appendices or addendums attached to contracts or agreements, providing additional information.
Covenant - A promise within a lease or deed stipulating certain uses or restrictions on the property.

Online Resources

References

Fisher, Jeffrey E., and Robert Heiman. “The Complete Guide to Real Estate Exhibits and Addendums.”
“Real Estate Principles” by Charles F. Floyd and Marcus T. Allen.
“Commercial Real Estate Leases: Preparation, Negotiation, and Forms” by Mark A. Senn.

Suggested Books for Further Study

“Practical Real Estate Law” by Daniel F. Hinkel
“Real Estate Law” by Marianne Jennings
“Law of Leases” by Benjamin H. Pivar
“Negotiating Commercial Real Estate Leases” by Martin I. Zankel

Real Estate Basics: Exhibits Fundamentals Quiz

### What are exhibits in a lease? - [x] Attachments providing supplementary information to the lease. - [ ] The primary terms of the lease. - [ ] Information about utilities. - [ ] The main financial obligations under the lease. > **Explanation:** Exhibits provide supplemental information to the lease, ensuring that all terms and additional details are precisely communicated. ### What is contained in an exhibit titled "Legal Description"? - [x] Precise geographical boundaries and layout of the property. - [ ] A list of tenants in the building. - [ ] Operational rules for the property. - [ ] An option for purchasing the property. > **Explanation:** "Legal Description" contains the exact geographical boundaries and layout of the property being leased. ### Are exhibits legally binding? - [x] Yes, exhibits are legally binding as they form part of the contract. - [ ] No, exhibits are just for informational purposes. - [ ] Only if both parties sign each exhibit individually. - [ ] Only if the exhibit is over 10 pages long. > **Explanation:** Exhibits are legally binding because they are an integral part of the contractual relationship between the parties. ### Who typically prepares exhibits in a lease? - [ ] The property manager. - [ ] The government real estate office. - [x] Legal professionals or attorneys. - [ ] The accounting department. > **Explanation:** Legal professionals or attorneys usually prepare exhibits to authenticate or add authority that they are accurate and legally valid. ### What is the purpose of a Covenant of Operations exhibit? - [ ] To describe the geographical layout of the property. - [ ] To list the tenants in the property. - [ ] To provide an option to purchase the property. - [x] To detail specific operations, usage rules, or requirements on the property. > **Explanation:** The Covenant of Operations exhibit specifies the operational rules, usage guidelines, or requirements applicable to the property. ### Can exhibits be modified once a lease is signed? - [x] Yes, with mutual consent and proper documentation. - [ ] No, they are fixed once signed. - [ ] Only by the landlord. - [ ] Only under court order. > **Explanation:** Exhibits can be amended with mutual consent from both parties, provided it is documented appropriately. ### If a tenant does not understand an exhibit, what should they do? - [ ] Ignore it. - [ ] Sign it anyway to proceed. - [x] Seek clarification from a legal professional. - [ ] Ask other tenants. > **Explanation:** Tenants should seek clarification from a legal professional if there’s clarity needed to ensure understanding before signing any document. ### Which document typically includes purchase options related to the property? - [ ] Exhibit A: Legal Description - [ ] Exhibit B: Covenant of Operations - [ ] Exhibit C: Cotenancy Agreements - [x] Exhibit D: Purchase Option > **Explanation:** Exhibit D typically outlines the terms under which the lessee may have an option to purchase the property. ### What related term describes a document that modifies existing lease terms? - [ ] Covenants - [ ] Attachments - [x] Addendum - [ ] Legal Description > **Explanation:** An addendum is a separate document that amends specific parts of the existing terms present in the primary lease or document. ### What is the best action if an exhibit does not agree with the main lease terms? - [ ] Ignore the conflicting exhibit - [ ] Sign, highlighting the disagreement - [ ] Mark the lease as impossible to enforce - [x] Discuss and amend with mutual consent > **Explanation:** Discussing and amending with mutual consent ensures that both parties are in agreement and all terms are accurately meant for enforcement.