An Early Lease Termination Agreement is a crucial document used when both landlord and tenant agree to end a lease before its natural expiration date. This document, governed by Hong Kong law, provides a formal framework for early lease termination while ensuring compliance with local regulations, particularly the Landlord and Tenant (Consolidation) Ordinance. It is commonly used in situations where either party needs to terminate the lease early due to business changes, relocation, or other circumstances, and both parties agree to the termination. The agreement typically includes detailed provisions for the termination date, financial settlements, property handover requirements, security deposit arrangements, and mutual releases. It helps prevent future disputes by clearly documenting the agreed terms and conditions of the early termination, making it an essential tool for risk management in property leasing.
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1. Parties: Identification of the landlord and tenant, including full legal names and addresses
2. Background: References to the original lease agreement, its key terms, and the mutual desire to terminate early
3. Definitions: Definitions of key terms used throughout the agreement, including 'Termination Date', 'Original Lease', and 'Settlement Amount'
4. Termination: The core agreement to terminate the lease, specifying the exact termination date and mutual release of future obligations
5. Financial Settlement: Details of any payment arrangements, including return of security deposit, advance rent adjustments, and termination fees
6. Handover Requirements: Specific conditions for returning the property, including state of repair and cleaning requirements
7. Release and Waiver: Mutual release from future obligations and claims under the original lease
8. Surviving Obligations: Specification of any obligations that continue after termination
9. Governing Law: Confirmation that Hong Kong law governs the agreement
10. Execution: Signature blocks and execution details
1. Reinstatement Works: Detailed requirements for property restoration, used when specific renovation or restoration work is required
2. Third Party Consents: Required when the termination needs approval from mortgagees, guarantors, or building management
3. Utility Transfers: Used when specific arrangements for utility account transfers need to be documented
4. Keys and Access Devices: Detailed inventory of keys and access devices when multiple sets or special access tools are involved
5. Outstanding Charges: Used when there are complex arrangements for settling utility bills, management fees, or other charges
6. Forwarding Address: Include when specific arrangements for future correspondence or deposit return are needed
1. Schedule 1 - Original Lease Details: Copy or key details of the original lease agreement
2. Schedule 2 - Financial Settlement Calculation: Detailed breakdown of all financial settlements, including deposit return and any pro-rata calculations
3. Schedule 3 - Property Inspection Report: Current condition report and agreed repair/restoration requirements
4. Schedule 4 - Handover Inventory: List of items to be handed over, including keys, access cards, and any included furnishings
5. Appendix A - Photographic Evidence: Photos documenting the property's condition at termination
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