Exhibit 10.3
AGREEMENT OF SUBLEASE
---------------------
THIS AGREEMENT OF SUBLEASE ("SUBLEASE") is entered into this _____ day
of ____________, 1998, but effective for all purposes as of January 1, 1999, by
and between ________________, a ___________ having its principal office at
__________________________________ ("LANDLORD"), and _____________, a Delaware
limited liability company having its principal office at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("TENANT").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Lease Agreement dated __________,
199_, by and between [Hospitality Properties Trust entity] ("PRIME LANDLORD")
and Landlord dated as of __________________ (the "PRIME LEASE"), a copy of which
is attached hereto as Exhibit A, Landlord has leased property commonly known as
---------
the Residence Inn Hotel located at ____________________________ (the "LEASED
PROPERTY");
WHEREAS, Tenant desires to sublease from Landlord and Landlord desires
to sublease to Tenant the Leased Property upon the terms and conditions set
forth herein;
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements hereinafter set forth, the parties hereto agree as follows:
1. Definitions. Capitalized terms not defined herein shall have the
-----------
meanings ascribed to such terms in the Prime Lease.
2. Leased Property. Subject to the written consent of the Prime
---------------
Landlord, Landlord hereby subleases to Tenant, and Tenant hereby subleases from
Landlord, for the term and upon the conditions hereinafter provided, the Leased
Property.
3. Term. The term of this Sublease shall be for a period commencing
----
January 1, 1999, provided that the Prime Landlord has given its consent to this
Sublease (the "COMMENCEMENT DATE"), and expiring on the day immediately prior to
the expiration date of the Prime Lease (the "EXPIRATION DATE"). If Landlord has
not notified Tenant on or before the Commencement Date that Prime Landlord has
given its consent, this Sublease shall automatically terminate and be of no
further force and effect.
4. Use. Tenant shall use and occupy the Leased Property solely as a
---
limited service hotel in accordance with Article 4 of the Prime Lease, and for
---------
no other purpose without the prior written consent of Landlord.
5. Rent. Tenant shall pay Rent in accordance with the terms and
----
conditions of Schedule 1 attached hereto and made a part hereof, and shall be
----------
prorated on a per diem basis for any partial month.
6. Obligations Under the Prime Lease. Except as may be inconsistent
---------------------------------
with the terms hereof and except as set forth on Schedule 2 attached hereto and
----------
made a part hereof, the terms, provisions, covenants, and conditions of the
Prime Lease shall be applicable to the Sublease with the same force and effect
as if fully set forth herein at length, and as if Landlord were the lessor under
the Prime Lease and Tenant were the lessee thereunder. Tenant shall be
required, however, to pay only the Rent provided for on Schedule 1 hereto and
----------
not the amounts of rent, additional rent and other charges payable by the lessee
pursuant to the Prime Lease. As between the parties hereto, Tenant hereby
assumes all of the obligations of Landlord, as the lessee, under the Prime
Lease. Landlord shall have all of the rights of the lessor under the Prime
Lease as against Tenant and, as between the parties hereto, Landlord agrees to
observe and perform the terms, provisions, covenants and conditions on its part
to be observed and performed hereunder and to use its commercially reasonable
efforts to cause Prime Landlord to observe and perform those applicable terms,
provisions, covenants and conditions to be observed and performed by the lessor
under the Prime Lease.
7. Subordination. This Sublease is subject and subordinate to the
-------------
Prime Lease and to the matters to which the Prime Lease is or shall be subject
or subordinate.
8. Prime Landlord's Right to Enter into a Direct Lease with Tenant;
----------------------------------------------------------------
Prime Landlord's Right to Receive Rent Directly from Tenant. In the event of
-----------------------------------------------------------
termination of the Prime Lease or reentry or dispossession of Landlord by Prime
Landlord under the Prime Lease, Prime Landlord may, at its option, terminate
this Sublease or take over and assume all of the right, title, interest and
obligations of Landlord hereunder, and Tenant shall, at Prime Landlord's option,
attorn to Prime Landlord, provided that neither Prime Landlord nor any Hotel
Mortgagee, as holder of a mortgage or as Prime Landlord under the Prime Lease,
if such mortgagee has succeeded to that position, shall (i) be liable for any
act or omission of Landlord under this Sublease, (ii) be subject to any credit,
counterclaim, offset or defense which theretofore accrued to Tenant against
Landlord, (iii) be bound by any previous modification of this Sublease not
consented to in writing by Prime Landlord or by any previous prepayment of more
than one (1) month's Rent, (iv) be bound by any covenant of Landlord to
undertake or complete any construction of the Leased Property or any portion
thereof, except to the extent required by the Prime Lease, (v) be required to
account for any security deposit of the Tenant other than any security deposit
actually delivered to Prime Landlord by Landlord, (vi) be bound by any
obligation to make any payment to Tenant or grant any credits, except for
services, repairs, maintenance and restoration provided for under this Sublease
or the Prime Lease that are performed after the date of such attornment, (vii)
be responsible for any monies owing by Landlord to the credit of Tenant, or
(viii) be required to remove any Person occupying any portion of the Leased
Property. In the event that Tenant receives a written Notice from Prime
Landlord or any Hotel Mortgagee stating that an Event of Default has occurred
and is continuing under the Prime Lease, Tenant shall thereafter be obligated to
pay all rentals accruing under this Sublease directly to the party giving such
Notice, or as such party may direct. All rentals received from Tenant by Prime
Landlord or the Hotel Mortgagee, as the case may be, shall be credited against
the amounts owing by Landlord under the Prime Lease. Tenant shall, at the
request of Prime Landlord, execute a suitable instrument in confirmation of such
agreement to attorn.
-2-
9. Notices.
-------
(a) Any and all notices, demands, consents, approvals, offers,
elections and other communications required or permitted under this Sublease
shall be deemed adequately given if in writing and the same shall be delivered
either in hand, by telecopier with computer generated acknowledgment of receipt,
or by mail or Federal Express or similar expedited commercial carrier, addressed
to the recipient of the notice, postpaid and certified with return receipt
requested (if by mail), or with all freight charges prepaid (if by Federal
Express or similar carrier).
(b) All notices required or permitted to be sent hereunder shall be
deemed to have been given for all purposes of this Sublease upon the date of
acknowledged receipt, in the case of a notice by telecopier, and, in all other
cases, upon the date of receipt or refusal, except that whenever under this
Sublease a notice is either received on a day which is not a Business Day or is
required to be delivered on or before a specific day which is not a Business
Day, the day of receipt or required delivery shall automatically be extended to
the next Business Day.
(c) All such notices shall be addressed:
if to Landlord to:
Host Marriott Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
--------------------------
with a copy (which shall not constitute notice) to:
Host Marriott Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Counsel
If to Tenant to:
-------------------------------
c/o Crestline Capital Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Counsel
with a copy (which shall not constitute notice) to:
Crestline Capital Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
-3-
(d) By notice given as herein provided, the parties hereto and
their respective successors and assigns shall have the right from time to time
and at any time during the term of this Sublease to change their respective
addresses effective upon receipt by the other parties of such notice and each
shall have the right to specify as its address any other address within the
United States of America.
10. Surrender. Upon the Expiration Date or the earlier termination
---------
of this Sublease, Tenant shall quit the Leased Property and surrender it to
Landlord in accordance with the terms of the Prime Lease.
11. Brokers. Landlord and Tenant warrant and represent to each other
-------
that no broker brought about this transaction or dealt with either party in
connection herewith.
12. General Provisions.
------------------
(a) Benefit and Burden. The covenants, conditions, agreements,
------------------
terms and provisions herein contained shall be binding upon, and shall inure to
the benefit of, the parties hereto and each of their respective personal
representatives, successors, heirs, executors, administrators and assigns.
(b) Governing Law. It is the intention of the parties hereto
-------------
that this Sublease (and the terms and provisions hereof) shall be construed and
enforced in accordance with the laws of the State of Maryland.
(c) Entire Agreement. This Sublease contains the final and
----------------
entire agreement between the parties hereto, and they shall not be bound by any
terms, statements, conditions or representations, oral or written, express or
implied, not herein contained.
(d) Conflicts Between this Sublease and the Prime Lease. With
---------------------------------------------------
respect to the relationship between Landlord and Tenant, the terms and
conditions of this Sublease shall take precedence with respect to any conflict
between the terms and conditions contained herein and the terms and conditions
of the Prime Lease. Nothing herein shall be construed in any way to affect the
rights and obligations of Landlord and the Prime Landlord under the Prime Lease.
(e) Captions. The captions throughout this Sublease are for
--------
convenience of reference only and the words contained therein shall in no way be
held or deemed to define, limit, describe, explain, modify, amplify or add to
the interpretation, construction or meaning of any provision of or the scope or
intent of this Sublease, nor in any way effect this Sublease.
(f) Singular and Plural. Wherever appropriate herein, the
-------------------
singular includes the plural and the plural includes the singular.
(g) Counterparts. This Sublease may be executed in several
------------
counterparts, but all counterparts shall constitute but one and the same
instrument.
-4-
(h) No Recordation. Neither this Sublease nor any short-form
--------------
memorandum or version hereof shall be recorded by either party.
-5-
IN WITNESS WHEREOF, Landlord and Tenant have each executed this
Sublease on the day and year first hereinabove written.
LANDLORD
--------
------------------------------------
By:
--------------------------------
Name:
-------------------------------
Title:
-----------------------------
TENANT:
------
------------------------------------
By:
--------------------------------
Name:
-------------------------------
Title:
-----------------------------
-6-
EXHIBIT A
Prime Lease
-----------
(Attached hereto.)
-7-
Schedule 1
----------
(Rental provisions)
-8-
Schedule 2
----------
Provisions of Prime Lease not applicable to Tenant
1. Section 2.4: Extended Term
2. Section 3.5: Security for Tenant's Performance
[others to be agreed upon]
-9-