CONDITIONAL ASSIGNMENT OF MANAGEMENT AGREEMENT
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THIS CONDITIONAL ASSIGNMENT OF MANAGEMENT AGREEMENT ("Assignment") is
made as of the 17th day of March, 2004, by Cedar Townfair, LLC, a Delaware
limited liability company, with an address of 00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000,
Xxxx Xxxxxxxxxx, Xxx Xxxx 00000 ("Borrower"), Cedar Shopping Centers
Partnership, LP with an address of 00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000, Xxxx
Xxxxxxxxxx, Xxx Xxxx 00000 ("Agent") and Xxxxx Fargo Bank N.A. f/k/a Norwest
Bank Minnesota, National Association, as Trustee for the registered holders of
NationsLink Funding Corporation, Commercial Mortgage Pass-Through Certificates,
Series 1998-2 (including its successors, transferees and assigns, "Lender"), c/o
Midland Loan Services, Inc., a Delaware corporation, its Attorney-in-Fact, with
an address of 10851 Xxxxxx, Xxxxxxxx Xxxx, Xxxxxx 00000.
RECITALS:
A. This Assignment is being executed in connection with Lender's
consent to the assumption by Borrower of a mortgage loan to Townfair Center
Associates, a Pennsylvania general partnership ("Seller") in the original
principal amount of Ten Million Seven Hundred Thousand Dollars ($10,700,000.00)
(the "Loan"). The Loan assumption is incident to Borrower's purchase of the real
property commonly known as Townfair Center (Phase I & II), 000 Xxxxx Xxx
Xxxxxxxx Xxxx, Xxxxx Xxxxxxxx, Xxxxxxxxxxxx (the "Property").
B. The Loan is evidenced by a Promissory Note (the "Note") dated as of
February 13, 1998, made by Seller and is secured by, among other things, an
Open-End Mortgage, Assignment of Leases and Rents and Security Agreement (the
"Mortgage"), dated as of February 13, 1998, granting a first lien on the
Property. The Lender's consent to the transfer of the Property to Borrower is
being made pursuant to a Consent and Assumption Agreement with Limited Release
dated of even date herewith (the "Assumption Agreement") (the Note, Mortgage,
Assumption Agreement and other documents executed in connection with the Loan
are collectively referred to herein as the "Loan Documents").
C. Pursuant to a certain Property Management Agreement, dated on or
about the date hereof, by and between Borrower and Agent, (the "Management
Agreement") (a true and correct copy of which Management Agreement is attached
hereto as Exhibit A), Borrower employed Agent exclusively to rent, lease,
operate and manage the Property.
D. Lender requires as a condition to giving its consent to the transfer
of the Property that Borrower assign the Management Agreement as set forth
below and Borrower and Agent agree to the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, in consideration of the above and the mutual promises
contained in this Assignment, the receipt and sufficiency of which are
acknowledged, the parties hereto agree as follows:
1. Assignment of Management Agreement. As additional collateral
security for the Loan, Borrower hereby conditionally transfers, sets over and
assigns to Lender all of Borrower's right, title and interest in and to the
Management Agreement, said transfer and assignment to automatically become a
present, unconditional assignment, at Lender's option, in the event of a default
by Borrower under the Loan Documents, including but not limited to escrow
agreements, and the failure of Borrower to cure such default within any
applicable grace period.
2. Termination. At such time as the Loan is paid in full and the
Mortgage is released of record, this Assignment and all of Lender's right, title
and interest hereunder with respect to the Management Agreement shall terminate.
3. Borrower's Covenants. Borrower hereby covenants with Lender that
during the term of this Assignment: (a) Borrower shall not transfer the
responsibility for the management of the Property from Agent to any other person
or entity without the prior written consent of Lender, which consent may be
withheld by Lender in Lender's sole discretion; (b) Borrower shall not terminate
or amend any of the terms or provisions of the Management Agreement without the
prior written consent of Lender, which consent may be withheld by Lender in
Lender's sole discretion; and (c) Borrower shall, in the manner provided for in
this Assignment, give notice to Lender of any notice or information that
Borrower receives which indicates that the Agent is terminating the Management
Agreement or that the Agent is otherwise discontinuing its management of the
Property.
4. Agent's Covenants. Agent warrants and represents to Lender, as of
the date hereof that (a) Agent has agreed to act as manager of the Property
pursuant to the Management Agreement, (b) the entire agreement between Agent and
Borrower for the management of the Property is evidenced by the Management
Agreement, (c) the Management Agreement constitutes the valid and binding
agreement of Agent, enforceable in accordance with its terms, and Agent has full
authority under all state and local laws and regulations, to perform all of its
obligations under the Management Agreement and (d) Borrower is not in default in
the performance of any of its obligations under the Management Agreement and all
payments and fees required to be paid by Borrower to Manager thereunder have
been paid to the date hereof.
5. Agreement by Borrower and Agent. Borrower and Agent hereby agree
that, if an Event of Default (as defined in the Loan Documents) occurs (beyond
any applicable notice, cure and/or grace period) under any of the Loan Documents
during the term of this Assignment, at the option of Lender exercised by written
notice to Borrower and Agent: (a) all rents, security deposits, issues, proceeds
and profits of the Property collected by Agent, after payment of all costs and
expenses of operating the Property (including, without limitation, operating
expenses, real estate taxes, insurance premiums, repairs and maintenance and the
fees and commissions payable under the Management Agreement), shall be applied
in accordance with Lender's written directions to Agent; (b) Lender may exercise
its rights under this Assignment and may immediately terminate the Management
Agreement and require Agent to transfer its responsibility for the management of
the Property to a management company selected by Lender in Lender's reasonable
discretion; and (c) Agent shall, if requested by Lender, or its successors or
assigns, continue performance, on behalf of Lender, or its successors or
assigns, of all of Agent*s obligations under the terms of the Management
Agreement with respect to the Property, provided Lender sends to Agent the
notice set forth in Paragraph 12 hereof and performs or causes to be performed
the obligations of Borrower to Agent under the Management Agreement accruing or
arising from and after, and with respect to the period commencing upon, the
effective date of such notice.
6. Lender's Right to Replace Agent. In addition to the foregoing, in
the event that Lender, in Lender's reasonable discretion, at any time during the
term of this Assignment, determines that the Property is not being managed in
accordance with generally accepted management practices for similarly situated
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properties, Lender shall deliver written notice thereof to Borrower and Agent,
which notice shall specify with particularity the grounds for Lender's
determination. If Lender reasonably determines that the conditions specified in
Lender's notice are not remedied to Lender's reasonable satisfaction by Borrower
or Agent within thirty (30) days from receipt of such notice or that Borrower or
Agent have failed to diligently undertake correcting such conditions within such
thirty (30) day period, Lender may direct Borrower to terminate the Management
Agreement and to replace Agent with a management company reasonably acceptable
to Lender in Lender's sole discretion.
7. Subordination of Management Agreement and Fees. Borrower and Agent
hereby agree that the Management Agreement and any and all liens, rights and
interests (whether xxxxxx or inchoate and including, without limitation, all
mechanic's and materialmen's liens under applicable law) owed, claimed or held,
by Agent in and to the Property, are and shall be in all respects subordinate
and inferior to the liens and security interests created or to be created for
the benefit of Lender, its successors and assigns, and securing the repayment of
the Note including, without limitation, those created under the Mortgage
covering, among other things, the Property, and filed or to be filed of record
in the public records maintained for the recording of mortgages in the
jurisdiction where the Property is located, and all renewals, extensions,
increases, supplements, amendments, modifications and replacements thereof.
Borrower and Agent further agree that Agent shall not be entitled to receive any
fee, commission or other amount payable to Agent under the Management Agreement
for and during any period of time that any amount due and owing Lender under the
Note and the Mortgage is due.
8. Consent and Agreement by Agent. Agent hereby acknowledges and
consents to this Assignment and agrees that Agent will act in conformity with
the provisions of this Assignment and Lender's rights hereunder or otherwise
related to the Management Agreement. In the event that the responsibility for
the management of the Property is transferred from Agent in accordance with the
provisions hereof, Agent shall, and hereby agrees to, fully cooperate in
transferring its responsibility to a new management company and effectuate such
transfer no later than thirty (30) days from the date the Management Agreement
is terminated. Further, Agent hereby agrees (a) not to contest or impede the
exercise by Lender of any right it has under or in connection with this
Assignment; and (b) that it shall, in the manner provided for in this
Assignment, give at least thirty (30) days prior written notice to Lender of its
intention to terminate the Management Agreement or otherwise discontinue its
management of the Property.
9. Lender's Agreement. So long as there does not exist an Event of
Default under any of the Loan Documents, Lender agrees to permit any sums due to
Borrower under the Management Agreement to be paid directly to Borrower.
10. No Joint Venture. Lender has no obligation to Agent with respect to
the Mortgage or Loan Documents and Agent shall not be a third party beneficiary
with respect to any of Lender's obligations to Borrower set forth in the Loan
Documents. The relationship of Lender to Borrower, is one of a creditor to a
debtor, and Lender is not a joint venturer or partner of Borrower.
11. Lender's Reliance on Representations. Agent has executed this
Agreement in order to induce Lender to consent to an assumption of the Loan
Documents and with full knowledge that Lender shall rely upon the
representations, warranties and agreements herein contained, and that but for
this instrument and the representations, warranties and agreements herein
contained, Lender would not take such actions.
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12. Notice. All notices given hereunder shall be in writing and shall
be either hand delivered or mailed, by registered U.S. mail, Return Receipt
Requested, first class postage prepaid, to the parties at their respective
addresses below or at such other address for any party as such party may
designate by notice to the other parties hereto:
To Borrower:
Cedar Townfair, LLC
00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxx Xxxx 00000
To Lender:
Xxxxx Fargo Bank N.A. f/k/a Norwest Bank Minnesota, National
Association, as Trustee for the registered holders of NationsLink
Funding Corporation, Commercial Mortgage Pass-Through Certificates,
Series 1998-2
c/o Midland Loan Services, Inc.
00000 Xxxxxx
Xxxxxxxx Xxxx, Xxxxxx 00000
To Agent:
Cedar Shopping Centers Partnership, LP
00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxx Xxxx 00000
13. Binding Nature of Assignment. This Assignment shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and assigns.
14. Counterparts. This Assignment may be executed in any number of
counterparts all of which taken together shall constitute one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Assignment to
be executed by their duly authorized representatives as of the day, month and
year first above written.
WITNESS/ATTEST: BORROWER:
Cedar Townfair, LLC,
a Delaware limited liability company
By: Cedar Shopping Centers Partnership, L.P.
a Delaware limited partnership
its Sole Member
By: Cedar Shopping Centers, Inc.
a Maryland corporation
its Sole General Partner
_______________________ By:____________________________________
Print Name: Xxx X. Xxxxxx
Title: President
WITNESS/ATTEST: AGENT:
Cedar Shopping Centers Partnership, L.P.
a Delaware limited partnership
By: Cedar Shopping Centers, Inc.
a Maryland corporation
its Sole General Partner
_______________________ By:________________________________________
Print Name: Xxx X. Xxxxxx
Title: President
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WITNESS/ATTEST: LENDER:
Xxxxx Fargo Bank N.A. f/k/a Norwest Bank
Minnesota, National Association, as Trustee for
the registered holders of NationsLink Funding
Corporation, Commercial Mortgage Pass-Through
Certificates, Series 1998-2
By: Midland Loan Services, Inc.,
a Delaware corporation,
Its Attorney-in-Fact
_________________________ By:_____________________________________________
Name:___________________________________________
Title:__________________________________________
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EXHIBIT A
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MANAGEMENT AGREEMENT
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