Leeds have reached an agreement with Juventus on a deal for McKennie and are moving quickly to complete the signing of the American midfielder.
It had been thought Leeds were negotiating to buy him, but talks then switched to a loan deal with an option to buy.
However, according to Italian outlet Calciomercato.com, the option will be turned into an obligation if two conditions are met.
If Leeds survive in the Premier League this season and if McKennie makes at least ten appearances, the option will become an obligation.
Leeds are paying a loan fee of €1.5m and if McKennie signs permanently then they will pay a further €33m.
It is also claimed that McKennie is set to earn more at Leeds.
At Juventus his salary is €2.5m net per year, but at Leeds he will earn over €4m net, a significant increase.
Leeds are expected to now wrap up the signing before the transfer window slams shut next week.