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EXHIBIT 10.3
LOAN NO. 99701
ASSIGNMENT OF LEASES AND RENTS
ASSIGNMENT MADE THIS 30th day of March, 1999.
ARDEN REALTY FINANCE V, L.L.C., a Delaware limited liability company
("BORROWER"), of the City of Los Angeles, County of Los Angeles, and State of
California in consideration of ONE HUNDRED FIFTEEN MILLION DOLLARS and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, does hereby absolutely, presently and irrevocably assign,
transfer and set over unto MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
("LENDER"), a corporation organized under the laws of the Commonwealth of
Massachusetts, with its principal place of business in the City of Springfield,
County of Hampden, and Commonwealth of Massachusetts, the following:
A. All of the right, title and interest of Borrower in and to those
certain leases affecting all or a portion of the real property more
particularly described on EXHIBIT A hereto (the "PREMISES") which leases
are listed on EXHIBIT B hereto, and all other and future lease(s) of the
Premises, and all modifications, renewals, and extensions of the leases
listed on EXHIBIT B and of other and future lease(s), and guarantees, if
any, of the lessee's obligations under said leases listed on EXHIBIT B
and under other and future lease(s). Each of said leases and other and
future lease(s) and all modifications, renewals and extensions and
guarantees, if any, relating thereto are hereinafter collectively
referred to as the "Leases" and
B. All rents, issues, income, proceeds and profits arising from the
Lease(s) and from the use and occupancy of the Premises, including,
without limitation, all fixed and additional rents, cancellation
payments, and all sums due and payments made under any guarantee of any
of the Leases or any obligations thereunder (collectively "Rents").
C. All rights, powers, privileges, options and other benefits of
Borrower under the Leases, including without limitation the immediate
and continuing right to make claim for, receive, collect and receipt for
all Rents, including the right to make such claim in a proceeding under
the Bankruptcy Code (hereinbelow defined), and the right to apply the
same to the payment of the Debt (hereinbelow defined).
THIS ASSIGNMENT is an absolute, present and irrevocable assignment and
is given in connection with a loan transaction in which Borrower has undertaken
obligations for the following:
A. The payment of all sums and indebtedness now or hereafter due under
that certain Promissory Note and any amendments, extensions or renewals
thereof, (the Promissory Note together with all amendments, extensions
or renewals thereof is hereinafter referred to as the "NOTE") in the
original principal sum of ONE HUNDRED FIFTEEN MILLION DOLLARS
($115,000,000) made by Borrower to the order of Lender, and dated March
30, 1999, which Note is secured by that certain Deed of Trust and
Security
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Agreement executed as of even date herewith by ▇▇▇▇▇▇▇▇ as trustor,
naming ▇▇▇▇▇▇ as beneficiary and Chicago Title Insurance Company as
trustee, originally encumbering twelve separate real property
developments (such Deed of Trust and Security Agreement, together with
all amendments, extensions or renewals thereof is hereinafter called the
"MORTGAGE") and intended to be duly recorded.
B. The performance and discharge of each and every obligation, covenant
and agreement of Borrower under this Assignment, the Note, the Mortgage
and any other instruments securing the Note (collectively the "LOAN
DOCUMENTS").
C. The payment of all sums now and hereafter becoming due and payable
under the Loan Documents (hereinafter the "DEBT").
THIS ASSIGNMENT is made on the following covenants, terms and
conditions:
SECTION 1. ▇▇▇▇▇▇▇▇'S COVENANTS AND WARRANTIES
Borrower hereby covenants and warrants to Lender as follows:
(a) ▇▇▇▇▇▇▇▇ has not executed any prior assignment of any of the Leases
or Rents which will remain effective after the recording of this
Assignment, nor has it performed any act or executed any other
instrument which might prevent Borrower from fulfilling any of the terms
and conditions of this Assignment or which might prevent Lender from
operating under any of the terms and conditions of this Assignment or
which would limit Lender in such operation;
(b) ▇▇▇▇▇▇▇▇ has not executed or granted any modification whatsoever of
any of the Leases, except as delivered to Lender; the Leases are in full
force and effect; and, except as disclosed to the Lender on a rent roll
delivered to Lender concurrently herewith, there are no material
defaults now existing under any of the Leases, or any conditions which,
after notice, passage of time, or both would constitute material
defaults;
(c) ▇▇▇▇▇▇▇▇ will observe and perform all the obligations imposed upon
the lessor under each of the Leases;
(d) ▇▇▇▇▇▇▇▇ will not collect any of the rents, issues, income, proceeds
and profits arising or accruing under the Leases or from the Premises
more than 1 month in advance of the time when the same shall become due
under the Leases (except customary security deposits) nor execute any
other assignment of the Leases or assignment of rents, issues, income,
proceeds or profits with respect to the Premises; and
(e) Except as permitted pursuant to the Mortgage, Borrower will not
alter or modify the terms of the Leases, give any consent or exercise
any option required or permitted by such terms, accept a surrender
thereof, or consent to any assignment of or subletting under any of the
Leases, whether or not in accordance with their terms.
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SECTION 2. ABSOLUTE ASSIGNMENT OF LEASE(S)
Borrower and ▇▇▇▇▇▇ intend that this Assignment constitute a present,
irrevocable and absolute assignment of the Leases and Rents, and not an
assignment for additional security only. Subject to the terms of this Section
2, Lender grants to Borrower a revocable license ("LICENSE") to collect and
receive the Rents. ▇▇▇▇▇▇▇▇ hereby agrees that ▇▇▇▇▇▇ may authorize direct the
lessees named in the Leases, and any other occupants of the Premises, and all
Lease guarantors, to pay over to Lender or such other party as Lender may
direct, all Rents, upon receipt from Lender of written notice to the effect
that an Event of Default (defined below) exists, and to continue to do so until
the lessees are otherwise notified by ▇▇▇▇▇▇.
SECTION 3. REVOCATION OF LICENSE
Upon or at any time after the occurrence of an Event of Default as
defined in the Note or Mortgage which permits acceleration of the Loan
(collectively, an "EVENT OF Default"), the License granted to Borrower in
Section 2 of this Assignment shall automatically be revoked without the need of
any action by ▇▇▇▇▇▇, and Lender shall immediately be entitled to receipt and
possession of all Rents, whether or not Lender enters upon or takes control of
the Premises.
Upon demand by ▇▇▇▇▇▇ after the occurrence of an Event of Default,
Borrower shall immediately deliver to Lender all Rents in the possession of
Borrower or its agents, and shall cooperate in instructing Borrower's agents
and the lessees under the Leases and all others in possession of the Premises
or any portion thereof to pay directly to Lender all Rents.
Upon revocation of the License, Lender may, at its option, without
waiving such Event Default and without notice or regard to the adequacy of the
security for the Debt, either in person or by agent, nominee or attorney, or by
a receiver appointed by a court, with or without bringing any action or
proceeding, dispossess Borrower and its agents and servants from the Premises,
without liability for trespass, damages or otherwise, and exclude Borrower and
its agents from the Premises.
Upon revocation of the License, ▇▇▇▇▇▇ may also take possession of the
Premises, and books, records and accounts relating thereto and have, hold,
manage, lease and operate the Premises on such terms and for such period of
time as Lender may deem proper. In addition, and with or without taking
possession of the Premises, Lender, in its own name, may demand, sue or
otherwise collect and receive all Rents, including those past due and unpaid
and may apply any Rents collected in such order of priority as Lender in its
sole discretion deems appropriate, to the payment of:
(a) all expenses of managing the Premises, including, without
limitation, the salaries, fees and wages of a managing agent and such
other persons or entities as Lender may deem necessary or desirable, and
all expenses of operating and maintaining the Premises, including,
without limitation, all taxes, claims, assessments, ground rents, water
rents, sewer rents and any other liens or charges, and premiums for all
insurance which Lender may deem necessary or desirable, and the cost of
all alterations, renovations, repairs or replacements, and all expenses
incident to taking and retaining possession of the Premises;
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(b) the Debt; and
(c) all reasonable costs and attorneys' fees incurred in connection with
the enforcement of this Assignment and any of the Loan Documents.
SECTION 4. NO LIABILITY OF LENDER
This Assignment shall not be construed to bind Lender to the performance
of any of the covenants, conditions, or provisions contained in any Lease, or
otherwise impose any obligation upon Lender. Lender shall not be liable for any
loss sustained by Borrower resulting from ▇▇▇▇▇▇'s failure to let the Premises
after an Event of Default, or from any other act or omission of Lender either
in collecting the Rents, or if Lender shall have taken possession of the
Premises, in managing the Premises after an Event of Default, unless such loss
is caused by the gross negligence or willful misconduct of Lender.
SECTION 5. NO MORTGAGEE IN POSSESSION
In the absence of taking of actual possession of the Premises by ▇▇▇▇▇▇,
in its own right and person, Lender (i) shall not be deemed a mortgagee in
possession, (ii) shall not be responsible for the payment of any taxes or
assessments with respect to the Premises, (iii) shall not be liable to perform
any obligation of the lessor under any of the Leases or under applicable law,
(iv) shall not be liable to any person for any dangerous or defective condition
in the Premises nor for any negligence in the management, upkeep, repair, or
control of the said Premises resulting in loss or injury or death to any
person, and (v) shall not be liable in any manner for the remediation of any
environmental impairment.
SECTION 6. BANKRUPTCY
After the occurrence of an Event of Default which permits acceleration
of the Loan, Lender shall have the right to proceed in its own name or in the
name of Borrower in respect of any claim, suit, action or proceeding, relating
to any of the Leases in a proceeding under the bankruptcy laws of the United
States ("Bankruptcy Code") including, without limitation, the right to file and
prosecute, all to the exclusion of Borrower, any proofs of claim, complaints,
motions, applications, notices and other documents.
If there shall be filed by or against Borrower a petition under the Bankruptcy
Code, and Borrower, as lessor under the Leases, shall determine to reject any
Leases pursuant to Section 365(a) of the Bankruptcy Code, the Borrower shall
give Lender not less than ten (10) days' prior notice of the date on which
Borrower shall apply to the bankruptcy court for authority to reject the
Leases. Lender shall have the right, but not the obligation, to serve upon
Borrower within such ten-day period a notice stating that (i) ▇▇▇▇▇▇ demands
that ▇▇▇▇▇▇▇▇ assume and assign the Lease to Lender pursuant to Section 365 of
the Bankruptcy Code and (ii) Lender covenants to cure or provide adequate
assurance of future performance under the Leases. If ▇▇▇▇▇▇ serves upon
Borrower the notice described in the preceding sentence, Borrower shall not
seek to reject the Leases and shall comply with the demand provided for in
clause (i) of the preceding sentence within thirty (30) days after the notice
shall have been given, subject to the performance by ▇▇▇▇▇▇ of the covenant
provided for in clause (ii) of the preceding sentence.
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SECTION 7. INDEMNITY OF LENDER
▇▇▇▇▇▇▇▇ hereby indemnifies Lender for, and holds Lender harmless from,
any and all liability, loss or damage which may be incurred under said Leases,
or under or by reason of this Assignment, and from any and all claims and
demands whatsoever which may be asserted against Lender by reason of any alleged
obligations or undertakings under any of the Leases, except any claims arising
out of ▇▇▇▇▇▇'s gross negligence or will misconduct.
Should Lender incur any such liability under the Leases or under or by
reason of this Assignment or in defense of any such claims or demands, the
amount thereof, including costs, expenses and reasonable attorneys' fees, shall
be secured by the Mortgage and Borrower shall reimburse Lender therefor,
immediately upon demand and upon the failure of Borrower so to Lender, at its
option, may declare all sums secured by the Mortgage immediately due and
payable.
SECTION 8. NO WAIVER OF RIGHTS BY ▇▇▇▇▇▇
Nothing contained in this Assignment and no act done or omitted by
▇▇▇▇▇▇ pursuant to powers and rights granted it hereunder shall be deemed to be
a waiver by Lender of any of its rights and remedies under the Note, Mortgage or
any other instrument securing the Note. This Assignment is made and accepted
without prejudice to any of such rights and remedies possessed by ▇▇▇▇▇▇ to
collect the Debt and to enforce the Loan Documents, and said rights and remedies
may be exercised by ▇▇▇▇▇▇ either prior to, simultaneously with, or subsequent
to any action taken by it hereunder.
SECTION 9. RELEASES OF PARTIES AND SECURITY
Lender may take or release other security for the payment of the Debt,
may release any party primarily or secondarily liable therefor, and may apply
any other security held by it to the satisfaction of any portion of the Debt
without prejudice to any of its rights under this Assignment.
SECTION 10. FUTURE ASSURANCES
▇▇▇▇▇▇▇▇ agrees that it will, from time to time, upon demand therefor by
▇▇▇▇▇▇, deliver to ▇▇▇▇▇▇ an executed counterpart of each of the Leases.
Further, ▇▇▇▇▇▇▇▇ agrees that it will execute, acknowledge and record such
additional assurances and assignments as ▇▇▇▇▇▇ may request covering any and all
of the Leases. Such assignments shall be on forms approved by the Lender, and
▇▇▇▇▇▇▇▇ agrees to pay all costs incurred in connection with the examination of
the Leases and the preparation, execution and recording of such assignments or
any other related documents, including, without limitation, fees of ▇▇▇▇▇▇'s
local counsel.
SECTION 11. AMENDMENTS
This Assignment may not be altered or amended except in a writing,
intended for that specific purpose, signed by both ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇.
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SECTION 12. HEADINGS AND CAPTIONS
The headings and captions of various sections of this Assignment are for
convenience only and are not to be construed as defining or limiting, in any
way, the scope or intent of the provisions hereof.
SECTION 13. NOTICES
The parties agree that all notices, demands or documents which are
required or permitted to be given or served hereunder shall be in writing and
shall be deemed given when sent by registered or certified mail or, wherever
permitted by law, by overnight or express delivery service, or by hand delivery
addressed to the Borrower or Lender, as the case may be, at the address
furnished below, and that such address may be changed from time to time by
either party by serving a notice on the other as provided herein:
Address of Borrower Address of Lender
Arden Realty Finance V, L.L.C. Massachusetts Mutual Life
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Executive Vice President and Attn: Senior Managing Director
Chief Financial Officer Real Estate Finance Group
SECTION 14. GOVERNING LAW
This instrument shall be governed by the laws of the jurisdiction in
which the Premises are located and, upon the occurrence of an Event of Default,
Lender shall have, in addition to the rights and remedies expressly set forth
herein, all rights and remedies available to Lender as the holder of an
assignment of leases, rents, issues and profits in that jurisdiction.
SECTION 15. DISCHARGE
Until the payment in full of the Debt, this Assignment shall continue in
full force and effect, whether or not recorded. Borrower hereby authorizes
▇▇▇▇▇▇ to furnish to any person written notice, that this Assignment of Leases
and ▇▇▇▇▇ remains in effect and agrees that such person may rely upon and shall
be bound by such statement. Upon payment in full of the Debt and the delivery
and recording of a satisfaction or discharge of the Mortgage duly executed,
this Assignment shall be void and of no effect.
SECTION 16. SEVERABILITY
If any one or more of the provisions contained in this Assignment shall for any
reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provision
of this Assignment but this Assignment
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shall be construed as if such invalid, illegal, or unenforceable provision had
never been contained herein.
IN WITNESS WHEREOF, the Borrower has duly executed this Assignment as of
the date first written above.
ARDEN REALTY FINANCE V, L.L.C.,
a Delaware limited liability company
By: ______________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇,
Chief Financial Officer
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ACKNOWLEDGMENT
[California]
STATE OF CALIFORNIA )
) SS.
COUNTY OF ______________________________ )
On __________________ before me, (here insert name and title of the
officer), personally appeared ________________________________
______________________________________________ personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person(s) whose
name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and
that by his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature ________________________________ (Seal)
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EXHIBIT A
PREMISES
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EXHIBIT B
LEASES
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