Like any good contract negotiation, the bank should assess its negotiating leverage. If the SNDA isn’t signed, which interest would be superior, the mortgage or the lease? Does the lease contain a provision requiring the tenant to execute an SNDA satisfactory to the bank? How critical is the lease to the cash flow and success of the project and borrower? Each transaction is going to be a bit different based on the underlying deal. Some lenders have had success with educating borrowers in advance to include lease provisions that require the SNDA to be acceptable to the bank. In any event, the bank’s top priorities should always be to ensure its mortgage and interest in the property are adequately protected and that it understands the consequences of the agreements it enters into. This information is provided for general education purposes and is not intended to be legal advice. Please consult legal counsel for specific guidance as to how this information applies to your institution’s circumstances or situation. * A conveyance includes a lease or memorandum of lease for a term exceeding three (3) years. Ind. Code 32-21-4-1(a)(2). Keaton J. Miller Of Counsel Krieg DeVault LLP KMiller@KDLegal.com Keaton is a member of the firm’s Financial Institutions Practice, where he provides strategic and business-focused legal counsel to public and private companies on commercial and consumer lending, corporate governance, risk management, regulatory compliance, and mergers and acquisitions. Krieg DeVault LLP is a Diamond Associate Member of the Indiana Bankers Association. Over 40 years of helping community banks thrive With an elite product suite customized to meet your needs, Bankers’ Bank keeps your bank competitive and thriving in your community; allowing you to focus on what matters most, building meaningful relationships and growing your community. Payments & Cash Management Solutions Bank Cards Commercial Banking & Leasing Residential Mortgage Solutions Investments Risk Management Solutions Faster Payments Reach out to your Indiana team to explore benefits of partnering with Bankers' Bank. BankersBank.com November/December 2025 33
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