Does it bother anyone that even after business people agree on the fundamental terms of a deal, it often takes a pretty long time to get an executed agreement in hand? Or, is this only a feeling that long-time practitioners experience? If, in general, old timers hold that view whereas relatively new entrants into the field of document negotiation do not, that might itself be part of the answer. [Read more…]
Why Does It Take So Long To Get A Deal Done?
June 3, 2012 By 6 Comments
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What Skills Does It Take To Draft An Agreement?
April 29, 2012 By 2 Comments
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This isn’t the kind of posting that will be of interest to a lot of readers. It’s kind of a “head” piece.
We got to thinking about “what is the role of the person who drafts a document” aside and apart from the negotiation component. First, the tentative conclusion – “he or she converts concepts into rules.” Deals are made up of ideas, i.e., concepts. The people who make those deals, and that includes the document draftsperson as well, reach agreements that they think they understand. That works at a particular instant in time if each side has the same understanding and if each side is honest enough to be bound by what their original understanding might be. But, it doesn’t work, even at the instant of conception, if the parties don’t share the same understanding of their agreement. Of course, that’s an oxymoron, but you get the idea. [Read more…]
PrintExcuses I have heard, or How to Derail Negotiations
January 22, 2012 By 9 Comments
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If you want to make a deal, then you’ve got to deal. You’ve got to trade. Yes, it requires give and take. You’ve got to satisfy the other side’s legitimate needs and concerns. That’s why I’ve never understood any of the negotiating responses listed below. Some can be countered with the question, “why.” Others are just negotiation enders or merely the start of a detour about process, not substance. Even the ones that naturally lead to a “why” response are sidetracking frustrations. They wouldn’t be such if the speaker continued with “because.” After all, how can you satisfy someone’s legitimate needs or concerns if they haven’t expressed them? [Read more…]
Ruminations Wrap-Up On SNDAs – Nuts and Bolts All Used Up
January 15, 2012 By 1 Comment
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Thanks for the great feedback and additional ideas to be explored when it comes to SNDAs. If you’ve just tuned in, you might want to look at the two prior installments of December 25 and January 2. Don’t miss the comments posted there as well.
On January 2, Ruminations covered the “engine” of the typical lender’s form of SNDA, i.e., the provisions lenders like to include so as to limit their obligations to the tenant and thereby limit their risks. Now we’ll move on to some other provisions typically found in a lender’s form. The first has to do with the “A” in “SNDA,” attornment. Assuming the SNDA states that the lender, its successor or the party who purchases the collateral property at a foreclosure agrees to recognize the tenant as its own tenant once the borrower-landlord loses the property, the SNDA should say that the tenant agrees to attorn to that new landlord. [If you want to refresh your recollection about what it means to “attorn,” look at the December 25 Ruminations posting.] [Read more…]
PrintSNDAs – Part 2 – The Nuts and Bolts!
January 2, 2012 By 7 Comments
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No introduction needed. If you know what SNDA stands for, then you are ready for the rest of this posting. If you’re a little shaky on what the acronym stands for, look at the December 25 Ruminations posting.
For all but the biggest tenants, and even then for most of them, the SNDA negotiation process begins with a lender’s form. And, it seems like a fair number of lenders think the “A” in “SNDA” stands for “Amendment,” i.e., an amendment of the lease. That’s pretty frustrating to a tenant and even to a landlord because, after a lease has been fully negotiated, often after it has been signed, along comes a somewhat remotely related party who is seeking to make unilateral changes through the backdoor of an SNDA. My advice is to tell them to fly a kite. In my experience, this almost always works. Here, a tenant actually has bargaining power: if the lease hasn’t yet been signed, few lenders want to kill a market rate deal; if the lender became such after the lease was signed, it needs to get the loan done and over with. So, that leaves only one scenario – where the mortgage (or deed of trust) is already in place, and the tenant doesn’t get started on negotiating the SNDA until after its lease has been executed. My strong advice to tenants is don’t let yourself get into that position. [Read more…]
PrintSome Whys and Wherefores About SNDAs – Part 1
December 25, 2011 By 8 Comments
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I thought I understood a few things about Subordination, Non-disturbance, and Attornment Agreements (SNDAs) and could offer some answers until another attorney refused to allow a fully executed SNDA to be recorded because “it would encumber his client’s property.” I was and remain stumped. If anyone can figure out why he so insisted, please let this Ruminator know. I couldn’t figure out how this moderately experienced attorney in a firm with a decent size real estate practice would believe such a thing, let alone could I figure out how to respond. The lender freely granted an otherwise acceptable SNDA, fully expecting that it would be recorded. Send your answers or comments to www.retailrealestatelaw.com.
Now, for what I think I have figured out. [Read more…]
PrintMore On The Exercising an Option While In Default Debate – Supplementary Thoughts
August 26, 2011 By 7 Comments
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The August 25 Ruminations posting about the right of a tenant to exercise renewal rights or non-disturbance rights even when it is in default engendered a lot of comment, both in on this Rumination site and in a number of Linked-In Group discussions. So, in a departure from past practice, I offer this “supplementary” posting with a generic form of compromise to “Get The Deal Done.” I’m not advocating one position or another with respect to any negotiation. In my role as an attorney, I represent clients, not myself. Attorneys advocate for their client’s desired outcomes. Attorneys are “who their clients are” when engaged as attorneys, though not in their public or private roles.
Ruminate over this: [Read more…]
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