New Jersey Subordination, Non-Disturbance, and Attornment Agreement of a Lease regarding a Commercial Loan

• Category: Loans and Lending
• State: Multi-State
• Control #: US-1176BG
• Format: Word; Rich Text

Description

The main purpose of this document is to subordinate the lease to the deed of trust or mortgage (if applicable), and have the tenant agree to be bound by the lease to a new owner in the event of foreclosure. A Subordination, Non-Disturbance, and Attornment Agreement (SODA) is a crucial document in the context of a Commercial Loan involving a lease in New Jersey. This agreement establishes the rights of the lender, landlord, and tenant, ensuring that their interests are protected and defining their respective positions in the event of default or foreclosure. It outlines the subordination of the lease to the loan, non-disturbance of the tenant's rights during foreclosure, and the tenant's obligation to attorn to the new owner. There are different types of SODA agreements that can be implemented in New Jersey: 1. Standard SODA Agreement: This is the most common form of the agreement used in commercial loans and leases. It delineates the priority of interests between the lender and the tenant, stating that the lender's interest in the property takes precedence over the tenant's lease. 2. Non-Subordination SODA Agreement: In certain situations, a tenant may negotiate a non-subordination clause. This type of agreement ensures that the tenant's lease maintains priority and is not subordinate to the lender's interest in the property. However, lenders typically prefer standard subordination agreements to safeguard their investments. 3. Limited SODA Agreement: In some cases, the lender may agree to limit the subordination of the lease to specific terms of the loan. This type of agreement provides safeguards to the tenant, ensuring that their lease is not undermined entirely but still maintains a lower priority than the lender's interest in the property. 4. Master SODA Agreement: A master agreement is commonly used in situations where multiple tenants occupy a commercial property, such as a shopping center or office building. Instead of executing separate Sodas for each lease, a single master agreement is established, encompassing all leases within the property. The primary purpose of a New Jersey SODA is to establish a clear understanding between all parties involved, protecting the landlord's and lender's rights while securing the tenant's occupancy rights during foreclosure or sale. It ensures that the tenant's rights are recognized by the new owner or lender, preventing any disturbance to their lease terms. Keywords: Subordination, Non-Disturbance, and Attornment Agreement, Commercial Loan, New Jersey, Lease, Lender, Landlord, Tenant, Default, Foreclosure, Subordination Clause, Non-Subordination Clause, Limited SODA Agreement, Master SODA Agreement, Priority of Interests, Occupancy Rights, Sale, SODA.

A Subordination, Non-Disturbance, and Attornment Agreement (SODA) is a crucial document in the context of a Commercial Loan involving a lease in New Jersey. This agreement establishes the rights of the lender, landlord, and tenant, ensuring that their interests are protected and defining their respective positions in the event of default or foreclosure. It outlines the subordination of the lease to the loan, non-disturbance of the tenant's rights during foreclosure, and the tenant's obligation to attorn to the new owner. There are different types of SODA agreements that can be implemented in New Jersey: 1. Standard SODA Agreement: This is the most common form of the agreement used in commercial loans and leases. It delineates the priority of interests between the lender and the tenant, stating that the lender's interest in the property takes precedence over the tenant's lease. 2. Non-Subordination SODA Agreement: In certain situations, a tenant may negotiate a non-subordination clause. This type of agreement ensures that the tenant's lease maintains priority and is not subordinate to the lender's interest in the property. However, lenders typically prefer standard subordination agreements to safeguard their investments. 3. Limited SODA Agreement: In some cases, the lender may agree to limit the subordination of the lease to specific terms of the loan. This type of agreement provides safeguards to the tenant, ensuring that their lease is not undermined entirely but still maintains a lower priority than the lender's interest in the property. 4. Master SODA Agreement: A master agreement is commonly used in situations where multiple tenants occupy a commercial property, such as a shopping center or office building. Instead of executing separate Sodas for each lease, a single master agreement is established, encompassing all leases within the property. The primary purpose of a New Jersey SODA is to establish a clear understanding between all parties involved, protecting the landlord's and lender's rights while securing the tenant's occupancy rights during foreclosure or sale. It ensures that the tenant's rights are recognized by the new owner or lender, preventing any disturbance to their lease terms. Keywords: Subordination, Non-Disturbance, and Attornment Agreement, Commercial Loan, New Jersey, Lease, Lender, Landlord, Tenant, Default, Foreclosure, Subordination Clause, Non-Subordination Clause, Limited SODA Agreement, Master SODA Agreement, Priority of Interests, Occupancy Rights, Sale, SODA.