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It has long been the case that whenever the targeted assets in a merger and acquisition transaction include lease rights as to real property, a leasing lawyer has an opportunity to provide valuable services to the client in that M&A transaction. Leasing lawyers educate buying clients about the current status of the target's leased real property assets, operations, rights, obligations, and liabilities and assist with plotting post-closing options. When representing sellers, leasing lawyers help their clients respond to diligence requests, evaluate and negotiate the sellers' representations proposed by the buyer, and craft disclosure schedule content. For many years, these roles have remained largely unchanged. Over the past decade, however, the rising popularity of representations and warranties insurance (RWI) policies invites even the most sure-footed real estate leasing lawyer to consider whether (and if so, how) his or her role changes if the subject M&A transaction includes an RWI policy.
This article provides an overview of the most commonly-accepted purposes of an RWI policy and an overview of the RWI policy underwriting process. Then, a discussion follows regarding matters of which real estate leasing lawyers should be particularly mindful when performing their role in such a transaction.
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