FORM OF ASSIGNMENT OF RENTS AND LEASES
THIS ASSIGNMENT OF RENTS AND LEASES (this "Assignment") is
made as of this ______ day of _________________1998, by ____________________, a
_______________________ with offices at ________________________ ("Borrower") to
ELDERTRUST OPERATING LIMITED PARTNERSHIP, a Delaware limited partnership with
offices at 000 XxXxxxxx Xxxx, Xxxxx 000, Xxxxxxx Xxxxxx, Xxxxxxxxxxxx 00000
(together with its successors and assigns, "Lender").
BACKGROUND
X. Xxxxxx has agreed to advance up to _________ ($ _________)
to Borrower (the "Loan"), pursuant to a Construction Loan Agreement, dated as of
the date hereof, between Borrower and Lender (the "Loan Agreement"), the terms
and conditions of which are incorporated herein by this reference, for the
purpose of financing the construction, erection and completion of certain
improvements at or about the Property (as hereinafter defined) in order to
convert the Property into a senior assisted living facility (the "Project"). The
Loan is evidenced by a Secured Note of Borrower (the "Note") and secured by
certain collateral documents described in the Loan Agreement, all dated as of
the date hereof, including, without limitation, a Mortgage and Security
Agreement (the "Mortgage") from Borrower in favor of Lender encumbering certain
real property situate in the Township of ___________________, ________________
as described more fully in Exhibit A attached hereto and made a part hereof (the
"Property") and a Guaranty and Suretyship Agreement by
_________________________________ ("_____"), an affiliate of Borrower, in favor
of Lender (the "Guaranty"). The Mortgage will be simultaneously recorded in
__________________________________. The Loan Agreement, the Note, the Mortgage,
the Guaranty and other collateral documents described in or accompanying the
Loan Agreement, as the same may be modified, amended, supplemented or assigned
from time to time, are hereinafter sometimes collectively referred to as the
"Loan Documents". The Project and Property are hereinafter referred to
collectively as the "Premises". Capitalized terms not otherwise defined herein
shall have the same meanings as set forth in the Loan Agreement.
B. As a condition of making the Loan to Borrower, Xxxxxx has
required Borrower to execute and deliver this Assignment.
TERMS AND CONDITIONS
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1. Assignment. In consideration of the Loan and Xxxxxx's
undertakings pursuant to the Loan Agreement and in order to secure the payment
of all sums due Lender pursuant to the Note, the Mortgage and the Loan
Agreement, and the timely performance of all of the terms, covenants,
representations, warranties and conditions contained in the Loan Documents,
Borrower hereby absolutely, presently and unconditionally conveys, transfers and
assigns to Lender, its successors and assigns, all of Borrower's rights, title
interest and privileges in and to the following:
1.1. All Residential Living Agreements (as defined in
the Loan Agreement) and leases now or hereafter in existence with respect to the
Premises or any part thereof (all such Residential Living Agreements and leases
are collectively referred to herein as the "Leases"); and
1.2. All rents, income, profits, revenues, proceeds,
deposits, accounts, rights and benefits due or to become due under the Leases
(the "Rents"), it being the intention of the Borrower that this Assignment
constitute a present, absolute assignment of the Leases and the Rents and not a
collateral assignment for additional security only.
This Assignment presently gives Lender the right to collect
the Rents and apply the Rents in partial payment of the Note. Borrower intends
that the Leases and Rents be absolutely assigned and that they no longer be,
during the term of this Assignment, property of Borrower or property of the
estate of Borrower, as defined in 11 U.S.C. ss.541. If any law exists requiring
Lender to take actual possession of the Premises (or some action equivalent to
taking possession of the Premises, such as securing the appointment of a
receiver) in order for Lender to "perfect" or "activate" the rights and remedies
of Lender as provided in this Agreement, Borrower waives the benefit of such
law. Subject to the terms of this Assignment and the Loan Agreement, Lender
grants to Borrower a license, revocable, as hereinafter provided, to collect and
use the Rents subject to the requirements of this Assignment and the Loan
Agreement. Upon the occurrence of any Event of Default (as defined below), the
license granted to Borrower herein shall, at Xxxxxx's election, be revoked by
Xxxxxx, and Xxxxxx shall immediately be entitled to possession of all Rents
collected thereafter (including Rents past due and unpaid) whether or not Xxxxxx
enters upon or takes control of the Premises. Upon such a revocation of the
license granted herein, Lender shall promptly provide Borrower with written
notice of same. Any Rents collected by Xxxxxxxx from and after the date on which
an Event of Default occurred shall be held by Borrower in trust for Lender.
Lender is hereby granted and assigned by Xxxxxxxx the right, at its option, upon
revocation of the license granted herein, to enter upon the Premises in person,
by agent or by court appointed receiver and to take any and all action necessary
to collect the Rents.
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2. Performance by Xxxxxxxx.
2.1. Notwithstanding this Assignment, Borrower shall
remain liable for any obligations undertaken by it pursuant to any Lease. Lender
may elect, in its sole discretion, to assume any and all such obligations of
Borrower under any Lease by written notice to the resident under such Lease with
a copy to Borrower; provided, however, that Borrower shall remain liable for
such obligations notwithstanding such election by Xxxxxx.
2.2. Notwithstanding any legal presumption to the
contrary, Lender shall not be obligated by reason of acceptance of this
Assignment to perform any obligation of Borrower under the Leases. This
Assignment shall not place responsibility for the control, care, management,
upkeep, operation or repair of all or any part of the Premises upon Lender, or
make Lender liable or responsible for any negligence in the control, care,
management, upkeep, operation or repair of all or any part of the Premises
resulting in loss or injury or death to any tenant, resident, licensee, employee
or other person or loss of or damage to the property of any of the foregoing.
2.3. Xxxxxxxx hereby agrees to defend, indemnify and
hold harmless Lender from any and all claims, liability, loss or damage, costs
and expenses (including reasonable attorneys' fees) arising from any claims by
any tenant, resident or licensee under any Lease or any employee or other person
in connection with the Lease, except for actions arising solely by reason of
Xxxxxx's negligence or willful misconduct.
2.4. Xxxxxxxx agrees that it will faithfully observe,
discharge and perform all of the obligations and agreements imposed upon
Borrower under the Leases. Borrower shall not do any of the following without
the prior written consent of Lender, which consent shall not be unreasonably
withheld: (a) consent to any material modification, alteration, cancellation,
extension or assignment of any of the Leases; (b) reduce, waive or defer payment
of the Rent under any of the Leases to any material extent; (c) collect or
accept payment of any of the Rents arising or accruing under any Lease more than
one (1) month in advance of the time when the same shall become due under the
terms of such Lease; or (d) waive or release any resident or tenant from any
material obligation or condition under any of the Leases.
3. Warranties. Borrower represents and warrants as follows:
3.1. Xxxxxxxx has title to and full right to assign
the Leases and the Rents thereunder; and no other assignment other than that
granted hereby to Lender of any interest in any of the Leases has been made.
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3.2. All Leases executed on or before the date hereof
are in full force and effect.
3.3. There is no existing default by Borrower or, to
Xxxxxxxx's knowledge, any resident under the provisions of any of the Leases. No
event has occurred which due to the passage of time, the giving or failure to
give notice, or both, would constitute a default under any of the Leases.
4. Events of Default. The occurrence of any Event of Default
under and as defined in the Loan Agreement, the Note and/or the Mortgage shall
constitute an event of default (an "Event of Default") hereunder.
5. Remedies. Upon the occurrence of an Event of Default,
Lender shall be entitled to exercise any one or more of the following rights,
powers and remedies:
5.1. Enter and take possession of the Premises and
collect, in its own name or in the name of Xxxxxxxx, the Rents accrued but
unpaid and in arrears as of the date of such Event of Default, as well as the
Rents which thereafter become due and payable. Xxxxxxxx hereby authorizes and
directs the residents and tenants under the Leases, upon receipt of written
notice from Xxxxxx, to pay to Lender any and all Rents due thereunder without
the necessity of any inquiry to Xxxxxxxx and notwithstanding any claim by
Borrower to the contrary. Xxxxxxxx further agrees that it shall facilitate in
all reasonable ways Xxxxxx's collection of the Rents and will, upon the request
of Xxxxxx, execute and deliver a written notice to each resident under the
Leases directing such resident to pay the Rents to Lender. Borrower shall have
no right or claim against any parties to any Lease who make payment to Lender
after receipt of written notice from Xxxxxx requesting same.
5.2. Take over and assume the management, operation
and maintenance of the Premises and perform in its own name or in the name of
Xxxxxxxx, all acts necessary and proper, and expend such sums out of the income
of the Premises as may be necessary in connection therewith, including the right
to enter into new Leases, to cancel existing Leases, to alter or amend the terms
of existing Leases, to renew existing Leases or to make concessions to the
parties thereto.
5.3. Endorse as Xxxxxxxx's attorney-in-fact,
Xxxxxxxx's name on all checks, drafts and similar forms of payment received in
payment of the Rents and Borrower hereby appoints Lender its attorney-in-fact
for such purposes and to otherwise enforce the purposes of this Assignment. The
aforesaid power of attorney shall be deemed coupled with an interest and shall
be irrevocable.
5.4. After payment of all proper charges and
expenses, including reasonable compensation to such managing agent as Lender may
select or employ, and after the accumulation of a reserve to meet taxes,
assessments, water rents, fire and
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liability insurance in requisite amounts, Lender shall credit the net proceeds
received by it from the Premises by virtue of this Assignment to any amounts due
and owing to Lender by Borrower under the terms of the Loan Documents, provided
that the manner of application of such proceeds and the items to be credited
shall be determined in the sole discretion of Lender. Lender shall not be
accountable for more monies than it actually receives from the Premises, nor
shall it be liable for failure to collect any such proceeds.
6. Notice to Tenants. Borrower hereby authorizes Xxxxxx to
give written notice of this Assignment at any time to each resident or tenant
under the Leases.
7. No Waiver.
7.1. The acceptance of this Assignment and the
collection of Rents under the Leases assigned hereby shall not constitute a
waiver of any rights of Lender under the terms of the Loan Documents. All rights
and remedies of Xxxxxx xxxxxxxxx and under the Mortgage are cumulative and
concurrent and may be exercised singly, successively or concurrently, at the
sole discretion of Lender.
7.2. The receipt by Lender of any Rents pursuant to
this Assignment after the institution of foreclosure or sale proceedings under
the Mortgage shall not cure such default or affect such proceedings or any sale
pursuant thereto.
8. List of Leases. Borrower shall, upon the request of Xxxxxx,
furnish a complete list, as of the date of such request, of all Leases and
providing such further reasonable detail as may be requested by Xxxxxx. Further,
as requested by Xxxxxx, Borrower shall deliver to Lender executed or certified
copies of all Leases, and all correspondence and memoranda relating thereto.
Such requests may be made at any reasonable time. Monthly requests, or more
frequent requests if made after an Event of Default under this Assignment shall
be deemed to be reasonable.
9. Further Assignments. Borrower shall, upon request of
Xxxxxx, promptly execute, acknowledge and deliver specific separate assignments
of any future Leases.
10. Termination of Assignment. This Assignment shall terminate
upon the repayment in full of the Note and the full performance of the
obligations under the Loan Documents.
11. Construction. When the content so requires, the singular
shall include the plural and conversely and use of any gender shall include all
genders.
12. Notices. All notices and other communications required
under this Assignment shall be made in accordance with the Section 8.6 of the
Loan Agreement.
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13. JURISDICTION. BORROWER HEREBY SUBMITS AND CONSENTS TO THE
JURISDICTION OF THE COURTS OF THE COMMONWEALTH OF PENNSYLVANIA AND THE COURTS OF
THE UNITED STATES LOCATED IN THE COMMONWEALTH OF PENNSYLVANIA IN ANY AND ALL
ACTIONS OR PROCEEDINGS ARISING HEREUNDER OR PURSUANT HERETO, AND IRREVOCABLY
AGREES TO SERVICE OF PROCESS BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS SET FORTH HEREIN OR SUCH OTHER ADDRESS AS BORROWER MAY DIRECT BY NOTICE
TO LENDER. BORROWER IRREVOCABLY AS AN INDEPENDENT COVENANT WAIVES A JURY TRIAL
AND THE RIGHT THERETO IN ANY ACTION OR PROCEEDING BETWEEN BORROWER AND LENDER,
WHETHER HEREUNDER OR OTHERWISE.
14. Headings. The headings preceding the text of the
paragraphs of this Assignment are inserted only for convenience of reference and
shall not constitute a part of this Assignment, nor shall they in any way affect
its meaning, construction or effect.
15. Governing Law. This Assignment shall be governed by the
law of the Commonwealth of Pennsylvania (but not including the choice of law
provisions thereof).
16. Binding Obligation. This Assignment shall be binding upon
Borrower and its successors and assigns and this Assignment shall inure to the
benefit of Lender and its successors and assigns, including any assignee of the
Loan Documents or participant in the Loan.
17. Modification. This Assignment may not be modified except
by a written agreement executed by the parties hereto.
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IN WITNESS WHEREOF, Xxxxxxxx has caused this Assignment to be
duly executed as of the day and year first above mentioned.
BORROWER:
WITNESS:
__________________________ By:______________________________
Name: Name:
Title:
[CORPORATE SEAL]
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____________________________:
: ss.
COUNTY OF :
On this _______________ day of ____________, 1998, before me,
a Notary Public in and for the aforesaid, the undersigned officer, personally
appeared _________________, who acknowledged himself to be the
_______________________ of , a __________________________ corporation, and that
he, as such ______________ being authorized to do so, executed the foregoing
instrument for the purposes therein contained by signing the name of such
corporation by himself as such ___________________.
IN WITNESS WHEREOF, I have hereunto set my hand and official
seal.
[Notarial Seal] _________________________________
Notary Public
My Commission Expires:
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Exhibit A
Description of the Property
