EX-4.19



 






Exhibit 4.19


ASSIGNMENT OF RENTS AND LEASES



THIS ASSIGNMENT OF RENTS AND LEASES (this “Assignment”) is made this 29th day
of June 2004 between SHOPSMITH, INC., an Ohio corporation (“Assignor”), and
THE PROVIDENT BANK (“Assignee”).





	A.	 	On even date herewith, Assignor has made and delivered its promontory
note in the amount of Two Million and 00/100 Dollars ($2,000,000.00) (the
“Note”), ‘ payable to the order of Assignee.






	B.	 	This Assignment is executed and delivered as security for the payment
of the Note, including all extensions and renewals thereof and for the
performance by Assignor of the terms, covenants and conditions contained
in the mortgage given by Assignor to Assignee, on even date herewith (the
“Mortgage”).




NOW THEREFORE, in consideration of and as an inducement for the making of the
loan evidenced by the Note, Assignor assigns, transfers and sets over to
Assignee all of the right, title and interest of Assignor in and to all
existing and future leases affecting all or any part of the real property (the
“Property”) situate in the Montgomery County, Ohio being more particularly
described on Exhibit A attached to this Assignment and made a part hereof and
all modifications, renewals and extensions of those leases and all guarantees,
if any, of the lessee’s obligations under those leases (the leases and
guarantees, modifications, renewals and extensions being collectively referred
to as the “Leases”), and, further, all of the right, title and interest of
Assignor in and to all rents, income and profits arising from the use and
occupancy of the Property (those rents, income and profits, including but not
limited to those arising from the Leases, being collectively referred to’ as
the “Rents”).



THIS ASSIGNMENT is a present and irrevocable assignment and is made for the
purpose of securing the Note, the Mortgage, this Assignment, and any security
agreements, guaranties, or other instruments of security executed now or in the
future by Assignor for the purpose of further evidencing or securing all or
part of the indebtedness evidenced by the Note, and payment of all sums
advanced by assignee hereunder or under any of the “Loan documents”, as
hereinafter defined, together with interest thereon at the “Interest Rate”
or, if applicable, the “Default Rate”, each as defined in the Note
(collectively, the “Secured obligations”). The Note, the Mortgage, this
Assignment, and all such additional instruments are collectively referred to as
the “Loan Documents.”



THIS ASSIGNMENT is made on the following additional terms, covenants and
conditions:



1. As long as there shall exist no default by Assignor under this Assignment or
with respect to any of the Secured Obligations which continues beyond any
applicable period provided in the Loan Documents for curing the default (a
“Default”). Assignor shall have the right to collect the Rents at the time
of, but not more than one month prior to the date provided for the





Page 45









 







payment the same. Assignor, without the prior written consent of Assignee, will
not cause or permit the leasehold estate under the Leases to merge with
Assignor’s reversionary interest.



2. Upon or at any time after a Default, Assignee, without in any way waiving
the Default, at its option, may take possession of the Property and have. hold,
manage, lease and operate the same on such terms and for such period of time as
Assignee may deem proper. This action may be taken without further notice and
without regard to the adequacy of the security for assignee’s payment and
performance of the Secured Obligations, either in person or by agent, with or
without bringing any action or proceeding, or by a receiver appointed by a
court. Additionally, Assignee, either with or without taking possession of the
Property in its own name, may demand, sue for or otherwise collect and receive
all Rents, including those past due and unpaid. Assignee shall have full power
to make all alterations, renovations, repairs or replacements to the Property
as may seem proper and to apply the Rents to the payment of: (a) all expenses
of managing the Property, including, but not limited to, the salaries, fees and
wages of a managing agent and such other employees as Assignee may deem
necessary or desirable; all taxes, charges, claims, assessments, water rents,
sewer rents, and any other liens’, premiums for all insurance whirls Assignee
may deem necessary or desirable; the cost of all alterations, renovations,
repairs or replacements, and all expenses incident to taking and retaining
possession of the Properly; and all other expenses of operating and maintaining
the Property; and (b) payment of the Secured Obligations, including any funds
advanced by Assignee to perform any of Assignor’s Secured Obligations under the
Loan Documents together with all costs and attorneys’ fees, in such order of
priority as to any of the items mentioned in this Paragraph 2 as Assignee in
its sole discretion may determine, The exercise by Assignee of one or more of
its rights and remedies under this Assignment shall not be deemed or construed
to make Assignee a mortgagee in possession. After any Default, all Rents
received by Assignor shall be held by Assignor in trust for the benefit of
Assignee. Any amounts received by assignor shall be turned over to Assignee
with or without demand immediately upon receipt.



3. Assignee shill not be liable for any loss sustained by Assignor resulting
from Assignee’s failure to let the Property after Default or from any other act
or omission of Assignee either in collecting the Rents or, if Assignee shall
have taken possession of the Property, in managing the Property after Default,
unless the loss is caused by the willful misconduct and bad faith of Assignee.
Further, Assignee shall not be obligated to perform or discharge any obligation
under the Leases by reason of this Assignment. Assignor agrees to indemnify
Assignee for, and to hold Assignee harmless from, any and all liability, loss
or damage that may be incurred under the Leases or by reason of this
Assignment, except for loss or damage due to the willful misconduct or bad
faith of Assignee while in possession of the Property. This Assignment shall
not operate to place responsibility for the control, care, management or repair
of the Property upon Assignee, or for the carrying out of any of the terms and
conditions of the Leases; nor shall it operate to make Assignee responsible or
liable for any waste committed on the Property by the tenants or any other
parties, or for any dangerous or defective condition of the Property, or for
any negligence in the management, upkeep, repair or control of the Property
resulting in loss or injury or death to any tenant, licensee, employee or
stranger.





Page 46









 







4. The affidavit, certificate, letter or statement of any officer, agent or
attorney of Assignee shall constitute conclusive evidence of the validity,
effectiveness and continuing force of this Assignment, and may be relied upon
by any lessee or other third person. Assignor authorizes and directs any future
lessee or occupant of any part of the Property upon receipt from Assignee of
written notice to the effect that Assignee is then the holder of the Note and
Mortgage and that a Default exists, to pay over to Assignee all Rents and to
continue to do so until otherwise notified by Assignee.



5. Assignee may take or release other security for the payment and performance
of the Secured Obligations, may release any party primarily or secondarily
liable and may apply any other security held by it to the satisfaction of the
Secured Obligations, without prejudice to any of its rights under this
Assignment.



6. Assignor agrees that it will, from time to time, upon demand by Assignee,
deliver to Assignee an executed counterpart of each and every Lease then
affecting the Property. Further, Assignor agrees that it will execute and
record such additional assignments as Assignee may request covering any and all
of the Leases. Those assignments shall be on forms approved by Assignee and
Assignor agrees to pay all costs incurred in connection with the preparation,
execution and recording of the assignments.



7. Assignor consents to the appointment of a receiver for the Property at
Assignee’s request in the event of a Default, and agrees that the receiver may
exercise the rights and powers contained in this Assignment and shall be
entitled to the benefits conveyed to Assignee by this Assignment.



8. Assignor warrants to Assignee that Assignor has not executed any prior
assignment of the Leases or Rents, nor has Assignor performed any act or
executed any other instrument that might prevent or limit Assignee’s rights or
operations under this Assignment. Assignor further warrants to Assignee that
Assignor has not executed or granted any modification of any Leases, except as
previously disclosed in writing.



9. Assignor agrees to observe and perform all the obligations imposed upon the
lessor under the Leases and not to do or permit anything to be done to impair
the security of the Leases. Assignor shall not, without Assignee’s prior
written consent: (a) collect any of the Rents more than one month in advance of
the time when the same shall become due (except in the case of security
deposits); (b) execute any other assignment of lessor’s interest in the Leases
or assignment of Rents; (c) alter, modify or change the terms of the Leases or
give any consent or exercise any option required or permitted by the terms of
the Leases; (d) cancel or terminate the Leases or accept a surrender of the
same; or (e) consent to any assignment of or subletting under the Lease.



10. Wherever used in this Assignment, the singular shall include both the
singular and plural and the use of any gender shall apply to all genders.





Page 47









 







11. Nothing contained in this Assignment and no act done or omitted by Assignee
pursuant to this Assignment shall be deemed to be a waiver by Assignee of any
of its rights and remedies under the Note, Mortgage or other Loan Documents,
Any rights and remedies under any other Loan Documents may be exercised by
Assignee either prior to, simultaneously with, or subsequent to any action
under this Assignment.



12. Any notice, demand or other instrument authorized or required to be given
or furnished under this Assignment to Assignor or Assignee shall be given in
the manner and effective at the time provided in the Mortgage.



13. The terms and conditions of this Assignment shall be binding upon Assignor
and the successors and assigns of Assignor including all successors in interest
in the Property, and shall inure to the benefit of Assignee and its successors
and assigns.



14. All rights, powers and remedies provided in this Assignment may be
exercised only to the extent that the exercise does not violate any law and are
intended to be limited to the extent necessary so that they will not render
this Assignment invalid or unenforceable. In the event that any provision
contained in this Assignment shall be deemed invalid, illegal or unenforceable
in any respect, the validity of the remaining provisions shall be in no way
affected.



15. This Assignment shall be construed and interpreted in accordance with the
laws of the State of Ohio.



16. ASSIGNOR WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
RELATING TO THIS ASSIGNMENT, THE NOTE IT SECURES, THE LOAN DOCUMENTS OR ANY
TRANSACTION CONTEMPLATED HEREIN.




EXECUTED as of the date first written above.




SHOPSMITH, INC.




By: /s/ Robert L. Folkerth




Name: Robert L. Folkerth




Title: President & COO




Page 48









 








	 	 	 
	STATE OF OHIO

	 	)
	

	 	) SS:
	COUNTY OF MONTGOMERY

	 	)






The foregoing instrument was acknowledged before me this 29th day of June 2004,
by Robert L Folkerth, Pres. & COO of Shopsmith Inc., an Ohio corporation, on
behalf of the corporation.




/s/ Cheryl A Griffith




Notary Public




This Instrument Prepared by:




Karen R. Adams, Esq.




Chemesky, Heyman & Kress P.L.L.




1100 Courthouse Plaza S.W.




Dayton, Ohio 45402





Page 49