ASSIGNMENT OF LEASES AND RENTS
EXHIBIT 10.3
AFTER RECORDING RETURN TO:
Xxxxxxx X. Xxxxxxxx, Esq.
Xxxxxx Xxxxxxx Xxxxxxxxx & Xxxx, PLLC
0000 X. Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Xxxxxx Xxxxxxx Xxxxxxxxx & Xxxx, PLLC
0000 X. Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
STATE OF GEORGIA
COUNTY OF XXXXXX
THIS ASSIGNMENT OF LEASES AND RENTS (hereinafter referred to as this “Assignment”), made and
entered into this 17th day of July, 2002, by and between 1945 THE EXCHANGE, LLC, a Georgia limited
liability company (hereinafter referred to as “Borrower”), and THE OHIO NATIONAL LIFE INSURANCE
COMPANY, an Ohio corporation (hereinafter referred to as “Lender”).
THAT FOR AND IN CONSIDERATION of the sum of Ten and No/100 Dollars ($10.00) and other good and
valuable considerations, the receipt and sufficiency whereof are hereby acknowledged, and in order
to secure the indebtedness and other obligations of Borrower hereinafter set forth, Borrower does
hereby grant, transfer and assign to Lender, its successors, successors-in-title and assigns, all
of Borrower’s right, title and interest in, to and under all of those certain leases and rental
agreements more particularly described in Exhibit “B” attached hereto and by this reference
made a part hereof, including any and all extensions, renewals and modifications thereof and
guaranties of the performance or obligations of any tenants or lessees thereunder (said leases and
agreements are hereinafter referred to collectively as the “Leases”, and said tenants and lessees
are hereinafter referred to collectively as “Tenants” or individually as a “Tenant” as the context
requires), which Leases cover portions of certain property (hereinafter referred to as the
“Premises”) located in Xxxx County, Georgia, more particularly described in Exhibit “A”
attached hereto and by this reference made a part hereof; together with all of Borrower’s right,
title and interest in and to all rents, issues and profits from the Leases and from the Premises.
TO HAVE AND TO HOLD unto Lender, its successors and assigns forever, subject to and upon the
terms and conditions set forth herein.
This Assignment is made for the purpose of securing (a) the full and prompt payment when due,
whether by acceleration or otherwise, with such interest as may accrue thereon, either before or
after maturity thereof, of that certain Real Estate Note (hereinafter referred to as the “Note”)
dated of even date herewith, made by Borrower to the order of Lender in the principal face amount
of Four Million Nine Hundred Thousand and No/100 Dollars ($4,900,000.00), together with any
renewals, modifications, consolidations and extensions thereof; (b) the full and prompt payment and
performance of any and all obligations of Borrower to Lender under the terms of that certain Deed
to Secure Debt and Security Agreement (hereinafter referred to as the “Security Deed”) made by
Borrower in favor of Lender dated of event date herewith and conveying the Premises to secure the
indebtedness evidenced by the Note; and (c) the full and prompt payment and performance of any and
all other obligations of Borrower to Lender under any other instruments now or hereafter
evidencing, securing or otherwise relating to the indebtedness evidenced by the Note (the Note,
Security Deed and said other instruments are hereinafter referred to collectively as the “Loan
Documents”, and “Indebtedness”).
ARTICLE I
1.01 Warranties of Borrower: Borrower hereby warrants and represents as follows:
(a) Borrower is the sole holder of the landlord’s interest under the Leases, is
entitled to receive the rents, issues and profits from the Leases and from the Premises, and
has good right to sell, assign, transfer and set over the same and to grant to and confer
upon Lender the rights, interests, powers and authorities herein granted and conferred;
(b) Borrower has made no assignment other than this Assignment of any of the rights of
Borrower under any of the Leases or with respect to any of said rents, issues or profits,
except for an assignment to a lender which is being paid and cancelled from the proceeds of
the Note;
(c) Borrower has neither done any act nor omitted to do any act which might prevent
Lender from, or limit Lender in, acting under any of the provisions of this Assignment;
(d) All Leases provide for rental to be paid monthly, in advance, and Borrower has not
accepted payment of rental under any of the Leases for more than one (1) month in advance of
the due date thereof;
(e) There exists no default or event of default or any state of facts which would, with
the passage of time or the giving of notice, or both, constitute a default or
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event of default on the part of Borrower or by any Tenant under the terms of any of the
Leases;
(f) Neither the execution and delivery of this Assignment or any of the Leases, the
performance of each and every covenant of Borrower under this Assignment and the Leases, or
the meeting of each and every condition contained in this Assignment, conflicts with, or
constitutes a breach or default under any agreement, indenture or other instrument to which
Borrower is a party, or any law, ordinance, administrative regulation or court decree which
is applicable to Borrower;
(g) No action has been brought or is threatened, which would interfere in any way with
the right of Borrower to execute this Assignment and perform all of Borrower’s obligations
contained in this Assignment of Leases; and
(h) The Leases are valid, enforceable and in full force and effect, and have not been
modified or amended, except as expressly set forth in said Exhibit “B” attached
hereto.
1.02 Covenants of Borrower. Borrower hereby covenants and agrees as follows:
(a) Borrower shall give Lender prompt written notice of its intention to let all or any
portion of the Premises, and all leases now or hereafter entered into will be in form and
substance subject to the prior, written approval of Lender. As an accommodation to
Borrower, Lender will approve a standard lease form. Notwithstanding the approval of a
standard lease form, Lender specifically reserves the right to approve each lease
hereinafter entered into wherein (i) the tenant occupies more than five percent (5%) of the
net leasable area of the improvements; (ii) where the lease term, excluding renewal options,
exceeds three (3) years; (iii) where the use of the premises may be different than the
standard building use regardless of length of lease term or square footage; (iv) where the
use may be potentially hazardous (x-ray laboratories, etc.); or (v) where there are
restrictions on competing stores in a shopping center or other similar project. Borrower
may deal with smaller tenants (those taking five percent [5%] of the space or less) in the
ordinary course of business without Lender’s consent. Lender shall notify Borrower within
ten (10) business days after receipt from Borrower of a request to approve a lease requiring
approval together with receipt of the required relevant information if Lender does not
approve the lease. In the event that Lender does not notify Borrower that Lender has not
approved the proposed lease within ten (10) business days, the lease shall be deemed
approved;
(b) Borrower shall (i) fulfill, perform and observe each and every condition and
covenant of landlord or lessor contained in each of the Leases; (ii) give prompt notice to
Lender of any claim of default under any of the Leases, whether given by a Tenant to
Borrower, or given by Borrower to a Tenant, together with a complete copy of any such
notice; (iii) at no cost or expense to Lender, enforce, short of termination, the
performance and observance of each and every covenant and condition of each of the Leases to
be performed or observed by the Tenant thereunder; and (iv) appear in and
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defend any action arising out of, or in any manner connected with, any of the Leases,
or the obligations or liabilities of Borrower as the landlord thereunder, or of the Tenant
or any guarantor thereunder;
(c) Borrower shall not, without the prior written consent of Lender (i) modify any of
the Leases; (ii) terminate the term or accept the surrender of any of the Leases; (iii)
waive or release a Tenant from the performance or observance by a Tenant of any obligation
or condition of any of the Leases; (iv) permit the prepayment of any rents under any of the
Leases for more than one (1) month prior to the accrual thereof; (v) give any consent to any
assignment or sublease by a Tenant under any of the Leases unless such Tenant remains
primarily liable on the lease and the lease is not otherwise modified; or (vi) assign its
interest in, to or under the Leases or the rents, issues and profits from the Leases and
from the Premises to any person or entity other than Lender;
The foregoing part of this Section 1.02(c) to the contrary notwithstanding, Borrower
shall have the following rights respecting the Leases without having to obtain the prior
written consent of Lender: (w) Borrower may deal with smaller tenants (those leasing five
percent (5%) of the space or less) in the ordinary course of business, including, without
limitation, any of the matters specified above in Section 1.02(c) which would otherwise
require Lender’s consent but for this item (w); (x) as provided in the existing License
Agreement with Xxxxxx Industries, Inc., Borrower, as landlord, may terminate the License
Agreement for the 4,210 square feet (Suite 300) by providing thirty (30) days’ prior written
notice to the Tenant but only in the event that Borrower has entered into a lease for said
space under terms approved in writing by Lender with a tenant having a business reputation
and credit worthiness approved in writing by Lender, which approvals shall not be
unreasonably withheld; (y) Borrower may give consent to any assignment by a Tenant under any
of the Leases in the event the assignment is to a new tenant having better credit than the
assigning Tenant, such new tenant, and its business reputation and credit, being subject to
the written approval of Lender which shall not be unreasonably withheld; and (z) with
respect to all Leases, Borrower may act in the ordinary course of business as market
conditions dictate and in a commercially reasonable manner subject, however, to Lender’s
right to consent to and/or approval of certain matters as set forth in this Section 1.02,
such consent and/or approval not to be unreasonably withheld.
In addition, with respect to any written consent and/or approval of Lender pursuant to
this Section 1.02(c), Lender shall notify Borrower if Lender does not consent to or approve
such matter within ten (10) business days after receipt from Borrower of a request to
consent to or approve of any of the matters requiring Lender’s consent or approval together
with receipt of the required relevant information. In the event that Lender does not notify
Borrower that Lender has not consented to or approved the requested matter within ten (10)
business days, the requested matter shall be deemed consented to or approved by Lender.
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(d) Borrower shall take no action which will cause or permit the estate of a Tenant
under any of the Leases to merge with the interest of Borrower in the Premises or any
portion thereof;
(e) Borrower shall protect, indemnify and save harmless Lender from and against all
liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses
(including, without limitation, attorneys’ fees and expenses) imposed upon or incurred by
Lender by reason of this Assignment and any claim or demand whatsoever which may be asserted
against Lender by reason of any alleged obligation or undertaking to be performed or
discharged by Borrower under this Assignment. In the event Lender incurs any liability,
loss or damage by reason of this Assignment, or in the defense of any claim or demand
arising out of or in connection with this Assignment, the amount of such liability, loss or
damage shall be added to the Indebtedness, shall bear interest at the default interest rate
specified in the Note from the date incurred until paid and shall be payable on demand; and
(f) Subject to Article 1.03(a), Borrower shall authorize and direct, and does hereby
authorize and direct, each and every present and future Tenant of the whole or any part of
the Premises to pay all rentals to Lender upon receipt of written demand from Lender to so
pay the same.
1.03 Covenants of Lender. Lender hereby covenants and agrees with Borrower as
follows:
(a) Although this Assignment constitutes a present and current assignment of all rents,
issues and profits from the Premises, so long as there shall exist no Event of Default, as
defined in Paragraph 2.01 below, on the part of Borrower, Lender shall not demand that such
rents, issues and profits be paid directly to Lender, and Borrower shall have the right to
collect, but not more than one (1) month prior to accrual, all such rents, issues and
profits from the Premises (including, but not by way of limitation, all rental payments
under the Leases); and
(b) Upon the payment in full of the Indebtedness, as evidenced by the recording or
filing of an instrument of satisfaction or full release of the Security Deed without the
recording of another Security Deed in favor of Lender affecting the Premises, this
Assignment shall be terminated and released of record by Lender and shall thereupon be of no
further force and effect.
ARTICLE II
2.01 Event of Default. The term, “Event of Default”, wherever used in this
Assignment, shall mean any of one or more of the following events:
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(a) The occurrence of any “default” or “Event of Default” under any of the Loan
Documents;
(b) The failure by Borrower duly and fully to comply with any covenant, condition or
agreement of this Assignment not cured within thirty (30) days following written notice
thereof from Lender to Borrower; or
(c) The breach of any warranty by Borrower contained in this Assignment.
2.02 Remedies. Upon the occurrence of any Event of Default after the expiration of
any applicable cure period, Lender may at its option, with or without notice or demand of any kind,
exercise any or all of the following remedies:
(a) Declare any part or all of the Indebtedness to be due and payable, whereupon the
same shall become immediately due and payable;
(b) Perform any and all obligations of Borrower under any or all of the Leases or this
Assignment and exercise any and all rights of Borrower herein and therein as fully as
Borrower itself could do, including, without limiting the generality of the foregoing;
enforcing, modifying, extending or terminating any or all of the Leases; collecting,
modifying, compromising, waiving or increasing any or all of the rents payable thereunder;
and obtaining new tenants and entering into new leases on the Premises on any terms and
conditions deemed desirable by Lender, and to the extent Lender shall incur any costs in
connection with the performance of any such obligations of Borrower, including costs of
litigation, then all such costs shall become a part of the Indebtedness, shall bear interest
from the incurring thereof at the default interest rate specified in the Note, and shall be
due and payable on demand;
(c) In Borrower’s or Lender’s name, institute any legal or equitable action which
Lender in its sole discretion deems desirable to collect and receive any or all of the
rents, issues and profits assigned herein; and
(d) Collect the rents, issues and profits and any other sums due under the Leases and
with respect to the Premises, and apply the same in such order as Lender in its sole
discretion may elect against (i) all costs and expenses, including reasonable attorneys’
fees, incurred in connection with the operation of the Premises, the performance of
Borrower’s obligations under the Leases and collection of the rents thereunder; (ii) all the
costs and expenses, including reasonable attorneys’ fees, incurred in the collection of any
or all of the Indebtedness, including all costs, expenses and attorneys’ fees incurred in
seeking to realize on or to protect or preserve Lender’s interest in any other collateral
securing any or all of the Indebtedness; and (iii) any or all unpaid principal and interest
on the Indebtedness.
Lender shall have full right to exercise any or all of the foregoing remedies without regard
to the adequacy of security for any or all of the Indebtedness, and with or without the
commencement of any legal or equitable action or the appointment of any receiver or trustee, and
shall have full right to enter upon, take possession of, use and operate all or any portion of the
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Premises which Lender, in its sole discretion, deems desirable to effectuate any or all of the
foregoing remedies.
ARTICLE III
3.01 Successors and Assigns. This Assignment shall inure to the benefit of and be
binding upon Borrower and Lender and their respective heirs, executors, legal representatives,
successors and assigns. Whenever a reference is made in this Assignment to “Borrower” or “Lender”,
such reference shall be deemed to include a reference to the heirs, executors, legal
representatives, successors and assigns of Borrower or Lender.
3.02 Terminology. All personal pronouns used in this Assignment, whether used in the
masculine, feminine or neuter gender, shall include all other genders, and the singular shall
include the plural, and vice versa. Titles of Articles are for convenience only and neither limit
nor amplify the provisions of this Assignment.
3.03 Severability. If any provision of this Assignment or the application thereof to
any person or circumstance shall be invalid or unenforceable to any extent, the remainder of this
Assignment and the application of such provisions to other person or circumstances shall not be
affected thereby and shall be enforced to the greatest extent permitted by law.
3.04 Applicable Law. This Assignment shall be interpreted, construed and enforced
according to the laws of the state wherein the Premises are situated.
3.05 No Third Party Beneficiaries. This Assignment is made solely for the benefit of
Lender and its assigns. No Tenant under any of the Leases nor any other person shall have standing
to bring any action against Lender as the result of this Assignment, or to assume that Lender will
exercise any remedies provided herein, and no person other than Lender shall under any
circumstances be deemed to be a beneficiary of any provision of this Assignment.
3.06 No Oral Modifications. Neither this Assignment nor any provisions hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in writing signed by
the party against whom enforcement of the change, waiver, discharge or termination is sought.
3.07 Cumulative Remedies. The remedies herein provided shall be in addition to or not
in substitution for the rights and remedies vested in Lender in any of the Loan Documents or in law
or equity, all of which rights and remedies are specifically reserved by Lender. The remedies
herein provided or otherwise available to Lender shall be cumulative and may be exercised
concurrently. The failure to exercise any of the remedies herein provided shall not constitute a
waiver thereof, or shall use of any of the remedies herein provided prevent the subsequent or
concurrent resort to any other remedy or remedies. It is intended that this clause shall be
broadly construed so that all remedies herein provided or otherwise available to Lender
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shall continue and be each and all available to Lender until the Indebtedness shall have been
paid in full.
3.08 Cross-Default. An Event of Default by Borrower under this Assignment shall
constitute an event of Default under all other Loan Documents.
3.09 Counterparts. This Assignment may be executed in any number of counterparts all
of which taken together shall constitute one and the same instrument, and any of the parties or
signatories hereto may execute this Assignment by signing any such counterpart.
3.10 Further Assurances. At any time and from time to time upon request by Lender,
Borrower will make, execute and deliver or cause to be made, executed and delivered, to Lender and,
where appropriate, cause to be recorded and/or filed and from time to time thereafter to be
re-recorded and/or refiled at such time and in such offices and places as shall be deemed desirable
by Lender, any and all such other and further assignments, deeds to secure debt, mortgages, deeds
of trust, security agreements, financing statements, continuation statements, instruments of
further assurance, certificates and other documents as may, in the opinion of Lender, be necessary
or desirable in order to effectuate, complete or perfect, or to continue and preserve (a) the
obligations of Borrower under this Assignment and (b) the security interest created by this
Assignment as a first and prior security interest upon the Leases and the rents, issues and profits
from the Premises. Upon any failure of Borrower so to do, Lender may make, execute, record, file,
re-record and/or refile any and all such assignments, deeds to secure debt, mortgages, deeds of
trust, security agreements, financing statements, continuation statements, instruments,
certificates and documents for and in the name of Borrower, and Borrower hereby irrevocably
appoints Lender the agent and attorney-in-fact of Borrower so to do.
3.11 Notices. Any and all notices, elections or demands permitted or required to be
made under this Assignment shall be in writing, signed by the party giving such notice, election or
demand and shall be delivered personally, or sent by registered or certified United States mail,
postage prepaid, to the other party at the address set forth below, or at such other address within
the continental United States of America as may have theretofore been designated in writing. The
time period in which a response to any notice, demand or request must be given, if any, shall
commence to run from the date of receipt of the notice, demand or request by the addressee thereof.
Rejection or other refusal to accept or the inability to deliver because of changed address of
which no notice was given shall be deemed to be receipt of the notice, demand or request sent. For
the purposes of this Assignment:
The address of Lender is:
The Ohio National Life Insurance Company
Xxx Xxxxxxxxx Xxx
Xxxxxxxxxx, Xxxx 00000
Xxx Xxxxxxxxx Xxx
Xxxxxxxxxx, Xxxx 00000
The address of Borrower is:
1945 The Exchange, LLC
c/o Abrams Properties, Inc.
c/o Abrams Properties, Inc.
0000 Xxx Xxxxxxxx X.X.
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: President
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: President
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3.12 Modifications, Etc. Borrower hereby consents and agrees that Lender may at any
time and from time to time, without notice to or further consent from Borrower, either with or
without consideration, substitute for any collateral so held by it, other collateral equal in value
of like kind, or of any kind equal in value; agree to modification of the terms of the Note or the
Loan Documents; extend or renew the Note or any of the Loan Documents for any period; grant
releases, compromises and indulgences with respect to the Note or the Loan Documents to any persons
or entities now or hereafter liable thereunder or hereunder; or take or fail to take any action of
any type whatsoever; and no action which Lender shall take or fail to take in connection with the
Loan Documents, or any of them, or any security for the payment of the Indebtedness or for the
performance of any obligations or undertakings of Borrower, nor any course of dealing with Borrower
or any other person, shall release Borrower’s obligations hereunder, affect this Assignment in any
way or afford Borrower any recourse against Lender. The provisions of this Assignment shall extend
and be applicable to all renewals, amendments, extensions, consolidations and modifications of the
Loan Documents and the Leases, and any and all references herein to the Loan Documents or the
Leases shall be deemed to include any such renewals, amendments, extensions, consolidations or
modifications thereof.
3.13 Reasonable Attorney’s Fees. Any reference made to the payment by Borrower to
Lender of attorney’s fees or of “reasonable attorney’s fees” shall mean and refer to the payment by
Borrower to Lender of actual attorney’s fees incurred based upon the attorney’s normal hourly rate
and the number of hours worked, and not the attorney’s fees statutorily defined in O.C.G.A. §
13-1-11.
3.14 Non-Recourse. Section 3.06 of the Security Deed is hereby incorporated herein by
this reference as though fully set forth herein.
(Signature Page Follows)
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| Signed, sealed and delivered in the presence of: | 1945 THE EXCHANGE, LLC, a Georgia limited liability company |
||||||||
| /s/ [illegible] | By: | Xxxxxx Properties, Inc., a Georgia | |||||||
| Unofficial Witness | corporation, its sole member | ||||||||
/s/ Xxxxxxxxx X. Xxxxx
|
|||||||||
Notary Public
|
By: | /s/ Xxxxxxx X. Xxxxxxx | |||||||
| Xxxxxxx X. Xxxxxxx, President | |||||||||
[NOTARIAL SEAL] |
|||||||||
| (CORPORATE SEAL) | |||||||||
Commission Expiration Date: |
|||||||||
June 29, 2003
|
|||||||||
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EXHIBIT “B”
LEASES
Any and all other leases and usufructs and arrangements of any sort now or hereafter affecting the
Premises and providing for or resulting in the payment of money to Borrower for the use of the
Premises or any part thereof, whether the user enjoys the Premises or any part thereof as tenant
for years, invitee, licensee, tenant at sufferance or otherwise, and irrespective of whether such
arrangements are oral or written.
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