EXHIBIT 10.10
$100,000,000
CREDIT AGREEMENT
Dated as of July 31, 1996
Among
AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P.
as the Borrower,
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SOCIETE GENERALE, SOUTHWEST AGENCY
as Structuring Agent,
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BANK ONE, TEXAS, N.A.
as Administrative Agent,
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and
THE BANKS NAMED HEREIN
as the Banks
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TABLE OF CONTENTS
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ARTICLE IDEFINITIONS AND ACCOUNTING TERMS
Page
Section 1.01 Certain Defined Terms......................................... 1
Section 1.02 Computation of Time Periods................................... 31
Section 1.03 Accounting Terms; Changes in GAAP............................. 31
Section 1.04 Types of Advances............................................. 32
Section 1.05 Miscellaneous................................................. 32
ARTICLE II
THE ADVANCES AND THE LETTERS OF CREDIT
Section 2.01 The Advances; Extension of Initial Maturity Date.............. 32
Section 2.02 Method of Borrowing........................................... 34
Section 2.03 Fees.......................................................... 37
Section 2.04 Reduction of the Commitments.................................. 38
Section 2.05 Repayment of Advances......................................... 39
Section 2.06 Interest, Late Payment Fee.................................... 39
Section 2.07 Prepayments................................................... 40
Section 2.08 Breakage Costs................................................ 43
Section 2.09 Increased Costs............................................... 43
Section 2.10 Payments and Computations..................................... 45
Section 2.11 Taxes......................................................... 47
Section 2.12 Illegality.................................................... 49
Section 2.13 Letters of Credit............................................. 49
Section 2.14 Determination of Borrowing Base............................... 52
Section 2.15 Bank Replacement.............................................. 53
Section 2.16 Sharing of Payments, Etc...................................... 54
Section 2.17 Collateral.................................................... 54
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ARTICLE III
CONDITIONS OF LENDING
Section 3.01 Conditions Precedent to Effectiveness of this Agreement......... 55
Section 3.02 Conditions Precedent for each Borrowing or Letter of Credit..... 57
Section 3.03 Conditions Precedent for Initial Borrowing or Letter of Credit.. 58
Section 3.04 Conditions Precedent to a Hotel Property Qualifying as an
Eligible Property............................................... 60
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01 Existence; Qualification; Partners; Subsidiaries................. 66
Section 4.02 Partnership and Corporate Power.................................. 68
Section 4.03 Authorization and Approvals...................................... 68
Section 4.04 Enforceable Obligations.......................................... 68
Section 4.05 Public Offering.................................................. 69
Section 4.06 Financial Statements............................................. 69
Section 4.07 True and Complete Disclosure..................................... 69
Section 4.08 Litigation....................................................... 70
Section 4.09 Use of Proceeds.................................................. 70
Section 4.10 Investment Company Act........................................... 70
Section 4.11 Taxes............................................................ 70
Section 4.12 Pension Plans.................................................... 71
Section 4.13 Condition of Hotel Property; Casualties; Condemnation............ 71
Section 4.14 Insurance........................................................ 72
Section 4.15 No Burdensome Restrictions; No Defaults.......................... 72
Section 4.16 Environmental Condition.......................................... 73
Section 4.18 Existing Mortgage Debt........................................... 74
Section 4.19 Title; Encumbrances.............................................. 74
Section 4.20 Leasing Arrangements............................................. 75
Section 4.21 Cash Management Systems.......................................... 75
Section 4.22 Franchise Agreements............................................. 75
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ARTICLE V
AFFIRMATIVE COVENANTS
Section 5.01 Compliance with Laws, Etc........................................ 76
Section 5.02 Preservation of Corporate Existence; Corporate Separateness, Etc. 76
Section 5.03 Payment of Taxes, Etc............................................ 78
Section 5.04 Visitation Rights; Bank Meeting.................................. 78
Section 5.05 Reporting Requirements........................................... 78
Section 5.06 Maintenance of Property, Required Work and Approved
Preliminary Property Plan Work................................... 82
Section 5.07 CAPEX Reserve.................................................... 83
Section 5.08 Appraisals....................................................... 84
Section 5.09 Duplicate Louisiana Notes........................................ 85
Section 5.10 Insurance........................................................ 85
Section 5.11 Casualty; Condemnation........................................... 85
Section 5.12 Cash Management Systems.......................................... 87
Section 5.13 Initial Properties............................................... 89
Section 5.14 Supplemental Guaranties.......................................... 89
Section 5.15 Participating Leases............................................. 89
ARTICLE VI
NEGATIVE COVENANTS
Section 6.01 Liens, Etc................................................ 90
Section 6.02 Indebtedness.............................................. 90
Section 6.03 Agreements Restricting Distributions From Subsidiaries.... 91
Section 6.04 Restricted Payments....................................... 91
Section 6.05 Fundamental Changes; Asset Sales.......................... 92
Section 6.06 Personal Property Leases.................................. 93
Section 6.07 Investments, Loans, Future Properties..................... 93
Section 6.08 Affiliate Transactions.................................... 94
Section 6.09 Sale and Leaseback........................................ 94
Section 6.10 Sale or Discount of Receivables........................... 94
Section 6.11 No Further Negative Pledges............................... 94
Section 6.12 Franchise Agreements...................................... 94
Section 6.13 Material Documents........................................ 95
Section 6.14 Other Businesses; Undeveloped Land........................ 95
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Section 6.15 Borrower Debt Service Ratio........................... 96
Section 6.16 Parent Debt Service Ratio............................. 96
Section 6.17 Net Worth............................................. 96
Section 6.18 Bank Accounts......................................... 96
ARTICLE VII
EVENTS OF DEFAULT; REMEDIES
Section 7.01 Events of Default........................................ 97
Section 7.02 Optional Acceleration of Maturity........................ 101
Section 7.03 Automatic Acceleration of Maturity....................... 102
Section 7.04 Cash Collateral Account.................................. 102
Section 7.05 Non-exclusivity of Remedies.............................. 103
Section 7.06 Right of Set-off......................................... 103
ARTICLE VIII
AGENCY AND ISSUING BANK PROVISIONS
Section 8.01 Authorization and Action................................. 104
Section 8.02 Agents' Reliance, Etc.................................... 104
Section 8.03 Each Agent and Its Affiliates............................ 105
Section 8.04 Bank Credit Decision..................................... 105
Section 8.05 Indemnification.......................................... 105
Section 8.06 Successor Agent and Issuing Banks........................ 105
ARTICLE IX
MISCELLANEOUS
Section 9.01 Amendments, Etc....................................... 106
Section 9.02 Notices, Etc.......................................... 108
Section 9.03 No Waiver; Remedies................................... 109
Section 9.04 Costs and Expenses.................................... 109
Section 9.05 Binding Effect........................................ 110
Section 9.06 Bank Assignments and Participations................... 110
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Section 9.07 Indemnification..................................... 112
Section 9.08 Execution in Counterparts........................... 113
Section 9.09 Survival of Representations, Indemnifications, etc.. 113
Section 9.10 Severability........................................ 113
Section 9.11 Business Loans...................................... 113
Section 9.12 Usury Not Intended.................................. 114
Section 9.13 Governing Law....................................... 114
Section 9.14 Consent to Jurisdiction............................. 114
Section 9.15 Knowledge of Borrower............................... 115
Section 9.16 Banks Not in Control................................ 115
Section 9.17 Headings Descriptive................................ 115
Section 9.18 Time is of the Essence.............................. 115
Section 9.19 WAIVERS OF JURY TRIAL............................... 115
Section 9.20 ENTIRE AGREEMENT.................................... 115
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EXHIBITS:
Exhibit A - Form of Note
Exhibit B - Form of Assignment and Acceptance
Exhibit C - Form of Assignment of Leases (Borrower)
Exhibit D - Form of Assignment of Leases (Participating Lessee)
Exhibit E - Form of Assignment of Management Agreement
Exhibit F - Form of Bank One Cash Management Agreement
Exhibit G - Form of Borrower Funding Certificate
Exhibit H - Form of Borrowing Base Certificate
Exhibit I - Form of Collateral Assignment and Security Agreement
Exhibit J - Form of Compliance Certificate
Exhibit K - Form of Credit Card Agreement
Exhibit L - Form of Depository Account Agreement
Exhibit M - Form of Environmental Indemnity
Exhibit N - Form of Franchisor Consent
Exhibit O - Form of General Assignment and Agreement
Exhibit P - Form of Ground Lessor Consent
Exhibit Q - Form of Guaranty
Exhibit R - Form of Irrevocable Direction to Pay
Exhibit S - Form of Liquor License Concession Agreement
Exhibit T - Form of Liquor License Company Consent
Exhibit U - Form of Liquor License Company Pledge Agreement
Exhibit V - Form of Manager Consent
Exhibit W - Form of Mortgages
Exhibit X - Form of Notice of Borrowing
Exhibit Y - Form of Notice of Conversion or Continuation
Exhibit Z - Form of Participating Lessee Estoppel
Exhibit AA - Form of Property Adjustment Report
Exhibit BB - Form of Property Certificate
Exhibit CC - Form of Security Agreement
Exhibit DD - Form of Battle ▇▇▇▇▇▇ L.L.P. Opinion
Exhibit EE - Form of Kane, Russell, ▇▇▇▇▇▇▇ and ▇▇▇▇▇ Opinion
Exhibit FF - Form of Local Counsel Opinion
Exhibit GG - Form of Ballard, Spahr, ▇▇▇▇▇▇▇ & Ingersoll Opinion
Exhibit HH - Form of McDonald, Hopkins, ▇▇▇▇▇ & ▇▇▇▇▇▇ Co. Opinion
Exhibit II Form of ▇▇▇▇▇ & Lardner Opinion
Exhibit JJ Form of McDonald, Carano, Wilson, McCune, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ &Hicks LLP Opinion
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SCHEDULES:
Schedule 1.01(a) - Commitments
Schedule 1.01(b) - Initial Properties, Allocated Debt Amount, Appraisal
Amounts and Cost Basis
Schedule 1.01(c) - Approved Preliminary Property Plan
Schedule 1.01(d) - Engineer Report Scope of Services
Schedule 1.01(e) - Approved Engineers
Schedule 1.01(f) - Environmental Report Scope of Services
Schedule 1.01(g) - Approved Environmental Consultants
Schedule 1.01(h) - Franchisors
Schedule 1.01(i) - Ground Leases
Schedule 1.01(j) - Guarantors
Schedule 1.01(k) - Hotel Capital and Operating Lease Limits
Schedule 1.01(l) - Liquor License Companies
Schedule 1.01(m) - Participating Leases
Schedule 4.01 - Subsidiaries
Schedule 4.08 - Litigation
Schedule 4.15 - Loan and Lease Disclosure
Schedule 4.17 - Legal Requirements; Zoning; Utilities; Access
Schedule 4.19 - Participating Lessee Personal Property
Schedule 4.21 - Cash Management Systems
Schedule 4.22 - Franchise Agreements
Schedule 4.23 - Management Agreements
Schedule 5.06 - Required Work for Initial Properties
Schedule 5.10 - Insurance
Schedule 9.02 - Notice Information
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CREDIT AGREEMENT
This Credit Agreement dated as of July 31, 1996 is among AMERICAN GENERAL
HOSPITALITY OPERATING PARTNERSHIP, L.P., a Delaware limited partnership, as the
Borrower, SOCIETE GENERALE, SOUTHWEST AGENCY, as Structuring Agent, BANK ONE,
TEXAS, N.A., as Administrative Agent, and the Banks.
The parties hereto do hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01 Certain Defined Terms. As used in this Agreement, the
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following terms shall have the following meanings (unless otherwise indicated,
such meanings to be equally applicable to both the singular and plural forms of
the terms defined):
"Accession Agreement" means an Accession Agreement in the form attached
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respectively to the Guaranty and Environmental Indemnity as Annex 1 thereto,
which agreement causes the Person executing and delivering the same to the
Administrative Agent to become a party to the Guaranty and to the Environmental
Indemnity.
"Acquisition Agreements" means for any Hotel Property the agreements entered
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into in connection with the acquisition of such Hotel Property.
"Adjusted Prime Rate" means, for any day, the fluctuating rate per annum of
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interest equal to the greater of (a) the Prime Rate in effect on such day and
(b) the Federal Funds Rate in effect on such day plus 1/2%.
"Adjustment Event" has the meaning set forth in Section 2.14(b).
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"Administrative Agent" means Bank One, Texas, N.A. in its capacity as
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Administrative Agent for the Banks pursuant to Article VIII and any successor
Administrative Agent appointed pursuant to Section 8.06.
"Advance" means an Advance by a Bank to the Borrower, any such Advance being
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either a Prime Rate Advance or a LIBOR Rate Advance.
"Affiliate" means, as to any Person, any other Person that, directly or
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indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such Person or
any Subsidiary of such Person. The term "control" (including the terms
"controlled by" or "under common control with") means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through ownership of a Control Percentage, by
contract or otherwise.
"Agents" means the Administrative Agent and the Structuring Agent, and
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"Agent" means either such agent.
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"Agents' Fee Letter" means the letter agreement dated as of June 12, 1996
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among the Borrower, the Structuring Agent and the Administrative Agent.
"AGH LP" means AGH LP, Inc., a Nevada corporation.
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"Agreement" means this Credit Agreement dated as of July 31, 1996 among the
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Borrower, the Structuring Agent, the Administrative Agent, and the Banks, as it
may be amended hereafter in accordance with its terms.
"Allocated Debt Amount" means for any Initial Property, the amount set forth
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for such Initial Property on Schedule 1.01(b) attached hereto, and for any other
Hotel Property, forty percent (40%) of the Real Estate Value of such Hotel
Property.
"Applicable Lending Office" means, with respect to each Bank, such Bank's
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Domestic Lending Office in the case of a Prime Rate Advance and such Bank's
LIBOR Lending Office in the case of a LIBOR Rate Advance.
"Applicable Margin" means, at any time, (a) with respect to a LIBOR Rate
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Advance, one and 85/100 percent (1.85%), and (b) with respect to a Prime Rate
Advance, one-half of one percent (.50%).
"Appraisal" means an appraisal of the Hotel Property prepared by an M.A.I.
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appraiser approved by the Agents in writing which appraisal is acceptable to the
Agents and done in conformity with the following standards: Uniform Standards
of Professional Appraisal Practice, the requirements of the Code of Professional
Ethics and the Standards of Professional Appraisal Practice of the Appraisal
Institute, the appraisal guidelines set forth by the office of the Comptroller
of the Currency and the Federal Reserve Board.
"Approved Preliminary Property Plan" means (a) with respect to the Initial
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Properties, the preliminary plans and projections of the Capital Expenditures
and the expenditures for FF&E of each Initial Property and set forth on Schedule
1.01(c), as such plans and projections may be amended
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with the approval of the Agents (which approval shall not be unreasonably
withheld) and (b) with respect to any Future Property that the Borrower desires
be an Eligible Property, the preliminary plans and projections of the Capital
Expenditures and the expenditures for FF&E for such Future Property approved by
the Majority Banks within one hundred eighty (180) days of the date of
acquisition of such Future Property (which approval will not be unreasonably
withheld or delayed).
"Approved Preliminary Property Plan Work" means, for any Hotel Property, the
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performance of the Capital Expenditures and the purchase of the FF&E
contemplated by the Approved Preliminary Property Plan for such Hotel Property.
"Asset Sale" means (a) any sale, financing lease (in which the Borrower or a
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Guarantor is lessor but exclusive of the Participating Leases), conveyance,
exchange, transfer, or assignment of any Property by the Borrower or a Guarantor
to a Person other than the Borrower or a Guarantor; and (b) any insured loss or
casualty of Hotel Property owned by the Borrower or any Guarantor if the
insurance proceeds in connection therewith are required by the provisions of
this Agreement to be used to repay Obligations.
"Assignment and Acceptance" means an assignment and acceptance entered into
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by a Bank and an Eligible Assignee, and accepted by the Administrative Agent, in
substantially the form of the attached Exhibit B.
"Assignment of Leases (Borrower)" means an assignment of leases, rents and
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security deposits executed by the Borrower or any Guarantor to secure the
Obligations, each substantially in the form of Exhibit C with such modifications
as may be necessary and appropriate in the opinion of counsel to the Agents to
comply with the state law of the filing jurisdiction and as may be reasonably
satisfactory to the Agents (provided any such modification does not materially
and adversely affect the rights and benefits to be accorded to the
Administrative Agent for the benefit of the Banks), as the same may be amended
or terminated in accordance with their terms.
"Assignment of Leases (Participating Lessee)" means an assignment of leases,
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rents and security deposits executed by the Participating Lessee for the benefit
of the Borrower or Guarantor who is the particular Property Owner for a Hotel
Property to secure the Participating Lessee's obligations under the
Participating Lease for such Hotel Property, each substantially in the form of
Exhibit D with such modifications as may be necessary and appropriate in the
opinion of counsel to the Agents to comply with the state law of the filing
jurisdiction and as may be reasonably satisfactory to the Agents (provided any
such modification does not materially and adversely affect the rights and
benefits accorded thereunder), as the same may be amended or terminated in
accordance with their terms.
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"Assignment of Management Agreement" means an assignment of management
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agreement executed by the Participating Lessee for the benefit of the Borrower
or Guarantor who is the particular Property Owner for a Hotel Property to secure
the Participating Lessee's obligations under the Participating Lease for such
Hotel Property, each substantially in the form of Exhibit E with such
modifications as may be necessary and appropriate in the opinion of counsel to
the Agents to comply with the state law of the filing jurisdiction and as may be
reasonably satisfactory to the Agents (provided any such modification does not
materially and adversely affect the rights and benefits accorded thereunder), as
the same may be amended or terminated in accordance with their terms.
"Associates" means, for any individual, the Associates (as such term is
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defined in Rule 12b-2 promulgated under the Exchange Act) of such individual.
"Banks" means the lenders listed on the signature pages of this Agreement and
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each Eligible Assignee that shall become a party to this Agreement pursuant to
Section 9.06.
"Bank One Cash Management Agreement" means the depository account agreement
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substantially in the form of the attached Exhibit F by and among the Cash
Manager, the Administrative Agent and the Borrower covering the Borrower's Bank
Accounts.
"Borrower" means American General Hospitality Operating Partnership, L.P., a
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Delaware limited partnership.
"Borrower's Bank Accounts" means the CAPEX Reserve, the Concentration Bank
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Account and the Operating Accounts (Borrower).
"Borrower Capitalization Event" means (a) any sale or issuance by the
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Borrower or any of its Subsidiaries of equity securities for consideration other
than a direct or indirect ownership interest in a Person that owns a Hotel
Property, (b) an issuance or incurrence by the Borrower or any of its
Subsidiaries of Indebtedness except for Indebtedness permitted pursuant to the
provisions of Section 6.02.
"Borrower Controlled Group" means all members of a controlled group of
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corporations and all trades (whether or not incorporated) under common control
which, together with the Borrower, are treated as a single employer under
Section 414 of the Code.
"Borrower Funding Certificate" means a certificate of the Borrower in
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substantially the form of the attached Exhibit G.
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"Borrowing" means a borrowing consisting of simultaneous Advances of the same
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Type made by each Bank pursuant to Section 2.01(a) or Converted by each Bank to
Advances of a different Type pursuant to Section 2.02(b).
"Borrowing Base" means an amount equal to the lesser of (i) 40% of the
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aggregate Real Estate Value of all Eligible Properties; and (ii) the product of
(A) the combined trailing twelve months Borrowing Base EBITDA generated by the
Eligible Properties multiplied by (B) 5.
"Borrowing Base Certificate" means a certificate of the Borrower in
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substantially the form of the attached Exhibit H, certified by a Responsible
Officer of Borrower to be true, correct and accurate in all material respects.
"Borrowing Base Determination Date" means any date the Borrowing Base is
---------------------------------
determined in accordance with Section 2.14.
"Borrowing Base EBITDA" means for any period the aggregate Property EBITDA of
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all Eligible Property.
"Business Day" means a day of the year on which banks are not required or
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authorized to close in New York City or Dallas, Texas and, if the applicable
Business Day relates to any LIBOR Rate Advances, on which dealings are carried
on by banks in the London interbank market.
"CAPEX Bills Pending" means, for any calendar quarter, the amount of payables
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for Capital Expenditures and expenditures for FF&E (except for the Approved
Preliminary Property Plan Work and the Required Work for which the Borrower is
not entitled to withdraw funds from the CAPEX Reserve to pay for) for the
Eligible Properties as of the end of such calendar quarter (a) which the
Borrower is at such time processing for payment in the ordinary course of
business and (b) which are not past due, all as certified in writing to the
Administrative Agent by the Borrower.
"CAPEX Reserve" means a bank account complying with the requirements of
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Section 5.07 established by the Borrower with the Administrative Agent.
"CAPEX Reserve Deposit Amount" means, for any calendar quarter, an amount
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equal to (a) 4% of the gross revenues from each Eligible Property for such
calendar quarter minus (b) the amount paid in such calendar quarter for Capital
Expenditures or FF&E for Eligible Properties (except for the Approved
Preliminary Property Plan Work and the Required Work for which the Borrower is
not entitled to withdraw funds from the CAPEX Reserve to pay for) which were
made or purchased in accordance with this Agreement minus (c) the CAPEX Bills
Pending as of the end of such calendar quarter plus (d) the CAPEX Bills Pending
as of the end of the previous calendar quarter.
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"Capital Expenditure" means any payment made directly or indirectly for the
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purpose of acquiring or constructing fixed assets, Real Property or equipment
which in accordance with GAAP would be added as a debit to the fixed asset
account of such Person making such expenditure, including, without limitation,
amounts paid or payable for such purpose under any conditional sale or other
title retention agreement or under any Capital Lease, but excluding repairs of
Property in the normal and ordinary course of business in keeping with the past
practices of the Borrower.
"Capitalization Event" means either a Borrower Capitalization Event or a
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Parent Capitalization Event.
"Capital Lease" means, for any Person, any lease of any Property (whether
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real, personal or mixed) by that Person as lessee which, in accordance with
GAAP, is or should be accounted for as a capital lease on the balance sheet of
that Person.
"Cash Collateral Account" means a special cash collateral account containing
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cash deposited pursuant to the terms of this Agreement to be maintained at the
Administrative Agent's office in accordance with Section 7.04.
"Cash Manager" means Bank One, Texas, N.A. or any successor thereto approved
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by the Agents.
"Cash Management System (Borrower)" means the system of Deposit Accounts of
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the Borrower and the Borrower's Subsidiaries (excluding the Permitted Other
Subsidiaries) including the Borrower's Bank Accounts pursuant to which all cash,
cash equivalents and credit card receipts of the Borrower and the Borrower's
Subsidiaries (excluding that of the Permitted Other Subsidiaries), respectively,
are collected and distributed, all as described in Schedule 4.21 annexed hereto,
as it may be modified from time to time in accordance with the terms hereof.
"Cash Management System (Participating Lessee)" means the system of Deposit
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Accounts of the Participating Lessee including the Operating Account
(Participating Lessee) for each Hotel Property (excluding DFW South and
Meadowlands) pursuant to which all cash, cash equivalents and credit card
receipts of the Participating Lessee (excluding that received in connection with
DFW South and Meadowlands) are collected and distributed, all as described in
Schedule 4.21 annexed hereto, as it may be modified from time to time in
accordance with the terms hereof.
"Cash Management Systems" means collectively the Cash Management System
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(Borrower) and the Cash Management System (Participating Lessee).
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"CERCLA" means the Comprehensive Environmental Response, Compensation, and
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Liability Act of 1980, as amended, state and local analogs, and all rules and
regulations and requirements thereunder in each case as now or hereafter in
effect.
"Closing Date" means the date on which each of the conditions set forth in
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Section 3.01 are satisfied.
"Code" means the Internal Revenue Code of 1986, as amended, and any successor
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statute.
"Collateral Assignment and Security Agreement" means a collateral assignment
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and agreement executed by the Borrower or any Guarantor to secure the
Obligations, each substantially in the form of Exhibit I with such modifications
as may be necessary and appropriate in the opinion of counsel to the Agents to
comply with the state law of the filing jurisdiction and as may be reasonably
satisfactory to the Agents (provided any such modification does not materially
and adversely affect the rights and benefits to be accorded to the
Administrative Agent for the benefit of the Banks), as the same may be amended
or terminated in accordance with their terms.
"Commitment" means, with respect to any Bank, the amount set opposite such
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Bank's name on Schedule 1.01(a) as its Commitment, or if such Bank has entered
into any Assignment and Acceptance, the amount set forth for such Bank as its
Commitment in the Register maintained by the Administrative Agent pursuant to
Section 9.06(c), as such amount may be reduced pursuant to Section 2.04.
"Compliance Certificate" means a certificate of the Borrower in substantially
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the form of the attached Exhibit J.
"Concentration Bank Account" means the Deposit Account maintained with the
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Cash Manager located in Dallas, Texas for the benefit of the Borrower which is a
part of the Cash Management System (Borrower), or any substitute account
maintained with the Cash Manager reasonably acceptable to the Administrative
Agent.
"Conditions to Collateral Release" shall for any Asset Sale (other than Asset
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Sales involving DFW South or Meadowlands) include all of the following
requirements: (a) no Default has occurred and is continuing or would occur upon
the consummation of such Asset Sale; (b) the Borrower, the Parent and their
respective Subsidiaries shall be in compliance with all covenants, terms and
conditions of the Credit Documents and the consummation of such Asset Sale shall
not cause or result in any of such Persons being in non-compliance; (c) the
Borrower shall have delivered to the Administrative Agent a Compliance
Certificate dated as of the date of the Asset Sale certifying that the
Conditions to Collateral Release are satisfied which Compliance Certificate
shall (i) certify that
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the financial covenants contained in this Agreement measured as of the date of
the Asset Sale (without inclusion in the calculation of such covenants the
operating results of the Hotel Property for such Asset Sale) are satisfied and
(ii) set forth the Borrower's calculations of such financial covenants; (d) at
least 10 days prior to such Asset Sale the Borrower shall have delivered to the
Administrative Agent a copy of the documents that have or will be executed in
connection with such Asset Sale and a draft of the Compliance Certificate that
the Borrower is obligated to deliver pursuant to the preceding clause (c); (e)
the Borrower shall have delivered to the Administrative Agent a Property
Adjustment Report in connection with such Asset Sale; (f) the Asset Sale is to a
Person other than the Borrower or a Subsidiary of Borrower and for fair market
value; (g) the written approval of the Administrative Agent has been obtained
which approval shall not be unreasonably withheld; (h) upon consummation of such
Asset Sale the Pool Requirements would be satisfied; and (i) contemporaneously
with such Asset Sale the Borrower makes a prepayment of the Advances as provided
in Section 2.07(c)(iii) in an amount of not less than the Release Amount for
such Hotel Property, provided that if the Asset Sale is a sale of a Permitted
Non-Eligible Property the Borrower shall not have to make a prepayment as long
as no Default has occurred and is continuing or would occur upon the
consummation of such Asset Sale.
"Consolidated" refers to the consolidation of the accounts of the Borrower
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with the Borrower's Subsidiaries and the Parent with the Parent's Subsidiaries,
as applicable, in accordance with GAAP, including, when used in reference to the
Borrower, principles of consolidation consistent with those applied in the
preparation of the Financial Statements.
"Control Percentage" means, with respect to any Person, the percentage of the
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outstanding capital stock of such Person having ordinary voting power which
gives the direct or indirect holder of such stock the power to elect a majority
of the Board of Directors of such Person.
"Controlled Group" means each of the Borrower Controlled Group, the
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Participating Lessee Controlled Group and the Manager Controlled Group, and
"Controlled Groups" means, collectively, all of such groups.
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"Convert", "Conversion", and "Converted" each refers to a conversion of
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Advances of one Type into Advances of another Type pursuant to Section 2.02(b).
"Cost Basis" means for any Hotel Property the sum of (a) for any Initial
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Property, the amount set forth for such Initial Property on Schedule 1.01(b)
attached hereto, and for any other Hotel Property, the aggregate purchase price
paid by the Borrower or its Subsidiary for such other Hotel Property (giving
effect to any securities used to purchase a Hotel Property at the fair market
value of the securities at the time of purchase based upon the price at which
such securities could be exchanged into the Parent's common stock assuming such
exchange occurred on the date of
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acquiring the Hotel Property), and (b) the actual cost of any Capital
Expenditures for such Hotel Property made by the Borrower or its Subsidiaries
pursuant to an Approved Preliminary Property Plan as certified, at the
Borrower's expense, upon the completion of such Capital Expenditures by a
property condition consultant or engineer reasonably acceptable to the Agents
who shall have inspected the Hotel Property and delivered to the Administrative
Agent a certificate that such Capital Expenditures have been made or purchased
and delivered to such Hotel Property.
"Credit Card Agreements" means each credit card agreement among each of the
----------------------
Participating Lessee, the Borrower or the Borrower's Subsidiaries (as
applicable), the credit card companies for all major credit cards accepted by
the Hotel Properties and the Administrative Agent, in each case substantially in
the form of Exhibit K attached hereto with such changes as are acceptable to the
Administrative Agent, and all other agreements with or directions to credit card
companies satisfactory to the Administrative Agent, in either case pursuant to
which, in accordance with Section 5.12 such credit card companies are to direct
funds from credit card receipts of a Hotel Property to either the Deposit
Account or Operating Account (Participating Lessee) of the Participating Lessee
for such Hotel Property which is subject to a Depository Account Agreement.
"Credit Documents" means this Agreement, the Notes, the Guaranties, the
----------------
Environmental Indemnities, the Security Documents, the Agents' Fee Letter, and
each other agreement, instrument or document executed by the Borrower or any of
its Subsidiaries at any time in connection with this Agreement.
"Debt Service" means, for any Person for the period for which such amount is
------------
being determined, the amount (without duplication) of all mandatory principal
payments made and interest accrued with respect to any Indebtedness of such
Person and all payments made in respect of Capital Leases of such Person.
"Debt Service Rate" means, for any Indebtedness for the period for which such
-----------------
amount is being determined, the greatest of (a) the percentage (on an annualized
basis) obtained by dividing the actual Debt Service for such Indebtedness for
such period by the average outstanding amount of such Indebtedness for such
period, (b) the percentage (on an annualized basis) that would be obtained by
dividing (i) the estimated Debt Service that would have been paid for such
Indebtedness for such period based upon (Y) an interest rate for such
Indebtedness for such period equal to 2.25% plus the Treasury Rate (as defined
----
herein) and (Z) a 20 year principal amortization of such Indebtedness with
constant monthly payments of principal and interest by (ii) the amount of such
Indebtedness, and (c) 10%. As used herein, "Treasury Rate" means the rate of
interest on United States Treasury Securities with a ten-year maturity, most
recently published prior to the date of any calculation made hereunder, and
shown in the "Week Ending" column and in the ten-year listing under the heading
"Treasury Constant Maturities" of the Federal Reserve Statistical Release Form
H-15.
-9-
"Deposit Account" means a demand, time, savings, passbook, checking or like
---------------
account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.
"Depository Account Agreements" means (i) the Bank One Cash Management
-----------------------------
Agreement, (ii) each depository account agreement among each of the
Participating Lessee, the Borrower or the Borrower's Subsidiaries (as
applicable), and the financial institutions at which Deposit Accounts are
located pursuant to the Cash Management System (Participating Lessee) with the
consent and acknowledgment of such Persons of the collateral assignment of such
agreement to the Administrative Agent, in each case substantially in the form of
Exhibit L attached hereto with such changes as are acceptable to the
Administrative Agent, and (iii) all other agreements with or directions to the
financial institutions at which Deposit Accounts are located satisfactory to the
Administrative Agent, in either case pursuant to which, in accordance with
Section 5.12 such financial institutions are upon the occurrence of certain
events to direct funds from such Deposit Accounts to the account designated by
the Administrative Agent.
"Default" means (a) an Event of Default or (b) any event or condition which
-------
with notice or lapse of time or both would, unless cured or waived, become an
Event of Default.
"DFW South" means the Holiday Inn Dallas DFW Airport South hotel.
---------
"DFW South LP" means DFW South I Limited Partnership, a Texas limited
------------
partnership.
"Dollar Equivalent" means the equivalent in another currency of an amount in
-----------------
U.S. Dollars to be determined by reference to the rate of exchange quoted by the
Administrative Agent, at 11:00 a.m. (Dallas, Texas time) on the date of
determination, for the spot purchase in the foreign exchange market of such
amount of Dollars with such other currency.
"Dollars" and "$" means lawful money of the United States of America.
------- -
"Domestic Lending Office" means, with respect to any Bank, the office of such
-----------------------
Bank specified as its "Domestic Lending Office" opposite its name on Schedule
9.02 or such other office of such Bank as such Bank may from time to time
specify to the Borrower and the Administrative Agent.
"EBITDA" means for any Person for any period for which such amount is being
------
determined, an amount equal to (a) Net Income for such period plus (b) to the
----
extent deducted in determining Net Income, Interest Expense, income taxes,
depreciation, amortization, and other non-cash items for such period minus (c)
-----
4% of the gross revenues for such Person for such period, as determined in
accordance with GAAP; provided that if any Property of such Person has been sold
--------
or conveyed by
-10-
such Person in such period, the amounts referred to in clauses (a)-(c) above
arising from such Property shall be excluded from the calculation of EBITDA for
such period; and provided further that if such Person has acquired any Property
----------------
in such period, the amounts referred to in clauses (a)-(c) above arising from
such Property during such entire period shall be included in the calculation of
EBITDA for such period.
"Effective Date" means the date all of the conditions precedent set forth in
--------------
Section 3.01 have been satisfied.
"Eligible Assignee" means (a) a commercial bank organized under the laws of
-----------------
the United States, or any State thereof, and having primary capital of not less
than $250,000,000 and approved by the Agents and the Issuing Bank, which
approvals will not be unreasonably withheld, (b) a commercial bank organized
under the laws of any other country which is a member of the Organization for
Economic Cooperation and Development and having primary capital (or its
equivalent) of not less than $250,000,000 (or its Dollar Equivalent) and
approved by the Agents and the Issuing Bank, which approvals will not be
unreasonably withheld, (c) a Bank, and (d) an Affiliate of the respective
assigning Bank, without approval of any Person but otherwise meeting the
eligibility requirements of (a) or (b) above.
"Eligible Property" means, as of any Borrowing Base Determination Date, any
-----------------
Hotel Property which is owned by the Borrower or any Guarantor on such date and
was so owned on the date of the most recent Borrowing Base Certificate delivered
to the Banks, and which satisfies the conditions to qualifying as an Eligible
Property set forth in Section 3.04 on such Borrowing Base Determination Date.
"Engineering Report" means with respect to any Hotel Property, an engineering
------------------
report in accordance with the scope of services attached hereto as Schedule 1.01
(d) reasonably satisfactory to the Agents prepared for the Banks by a Person set
forth on Schedule 1.01(d) or otherwise satisfactory to the Agents covering the
physical condition of the Hotel Property, including without limitation the
structural, electrical, plumbing, mechanical and other essential components of
the Hotel Property.
"Environment" or "Environmental" shall have the meanings set forth in 43
----------- -------------
U.S.C. (S) 9601(8) (1988).
"Environmental Claim" means any third party (including governmental agencies
-------------------
and employees) action, lawsuit, claim, demand, regulatory action or proceeding,
order, decree, consent agreement or notice of potential or actual responsibility
or violation (including claims or proceedings under the
-11-
Occupational Safety and Health Acts or similar laws or requirements relating to
health or safety of employees) which seeks to impose liability under any
Environmental Law.
"Environmental Indemnity" means one or more environmental indemnity
-----------------------
agreements dated of even date herewith in substantially the form of the attached
Exhibit M executed or to be executed by the Borrower, the Parent and all
Subsidiaries of the Borrower (including each Permitted New Subsidiary but
excluding the Permitted Other Subsidiaries), and any future environmental
indemnities executed in connection with any Hotel Property, as any of such
environmental indemnities may be amended hereafter in accordance with the terms
of such agreements.
"Environmental Law" means all Legal Requirements arising from, relating to,
-----------------
or in connection with the Environment, health, or safety, including without
limitation CERCLA, relating to (a) pollution, contamination, injury,
destruction, loss, protection, cleanup, reclamation or restoration of the air,
surface water, groundwater, land surface or subsurface strata, or other natural
resources; (b) solid, gaseous or liquid waste generation, treatment, processing,
recycling, reclamation, cleanup, storage, disposal or transportation; (c)
exposure to pollutants, contaminants, hazardous, medical, infectious, or toxic
substances, materials or wastes; (d) the safety or health of employees; or (e)
the manufacture, processing, handling, transportation, distribution in commerce,
use, storage or disposal of hazardous, medical, infectious, or toxic substances,
materials or wastes.
"Environmental Permit" means any permit, license, order, approval or other
--------------------
authorization under Environmental Law.
"Environmental Report" means with respect to any Hotel Property, an
--------------------
environmental report in accordance with the scope of services attached hereto as
Schedule 1.01 (f) prepared for the Banks by a Person set forth on Schedule
1.01(f) or otherwise satisfactory to the Agents certifying to the Agents and the
Banks that the Hotel Property and the soil and the groundwater thereunder do not
contain Hazardous Substances except for Permitted Hazardous Substances.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
-----
from time to time.
"Escrow Breaking Deadline" means August 9, 1996.
------------------------
"Eurocurrency Liabilities" has the meaning assigned to that term in
------------------------
Regulation D of the Federal Reserve Board (or any successor), as in effect from
time to time.
"Event of Default" has the meaning set forth in Section 7.01.
----------------
-12-
"Expiration Date" means, with respect to any Letter of Credit, the date on
---------------
which such Letter of Credit will expire or terminate in accordance with its
terms.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
------------------
annum equal for each day during such period to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for any such day on such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Federal Reserve Board" means the Board of Governors of the Federal Reserve
---------------------
System or any of its successors.
"FF&E" means furniture, fixtures and equipment.
----
"Financial Statements" means the financial statements described in Section
--------------------
4.06.
"Financing Statement (Borrower)" means any Uniform Commercial Code -
------------------------------
Financing Statement - Form UCC-1 to be executed and delivered by Borrower or any
of its Subsidiaries in connection with perfecting the security interest assigned
by any Security Document, and any extension, renewal, or amendment thereof.
"Financing Statement (Participating Lessee)" means any Uniform Commercial
------------------------------------------
Code - Financing Statement - Form UCC-1 to be executed and delivered by
Participating Lessee in connection with perfecting the security interest
assigned by any Participating Lessee Document, and any extension, renewal, or
amendment thereof.
"Franchise Agreements" means those certain Agreements listed on Schedule 4.22
--------------------
attached hereto and any future franchise or license agreement for an Eligible
Property with a reputable, nationally known, third party franchisor or licensor
approved by the Agents in writing.
"Franchisor" means those certain franchisors listed on Schedule 1.01(h )
----------
attached hereto, or any other franchisor or licensor of a Hotel Property
approved by the Agents in writing.
"Franchisor Consent" means a Franchisor's Consent and Agreement acceptable to
------------------
the Agents and in substantially the form of one of the forms attached as Exhibit
N or such other form as approved by the Agents in writing, executed by a
Franchisor for a Hotel Property.
-13-
"Fund," "Trust Fund," or "Superfund" means the Hazardous Substance Response
---- ---------- ---------
Trust Fund, established pursuant to 42 U.S.C. (S) 9631 (1988) and the Post-
closure Liability Trust Fund, established pursuant to 42 U.S.C. (S) 9641 (1988),
which statutory provisions have been amended or repealed by the Superfund
Amendments and Reauthorization Act of 1986, and the "Fund," "Trust Fund," or
"Superfund" that are now maintained pursuant to 42 U.S.C. (S) 9507.
"Funds from Operations" means for any period an amount equal to the
---------------------
Consolidated Net Income of the Borrower and the Borrower's Subsidiaries for such
period excluding gains (losses) from debt restructuring and sales of property
(including furniture and equipment) plus real estate related depreciation and
amortization (excluding amortization of deferred financing costs) and after
adjustments for unconsolidated partnerships and joint ventures; provided,
however, if any extraordinary items are excluded for purposes of calculating Net
Income, such items shall not be further excluded for purposes of making the
calculation set forth in this definition.
"Future Property" means any Hotel Property except for the Initial Properties,
---------------
the DFW South or the Meadowlands which the Borrower or any Subsidiary of the
Borrower acquires.
"GAAP" means United States generally accepted accounting principles as in
----
effect from time to time, applied on a basis consistent with the requirements of
Section 1.03.
"General Assignment and Agreement" means a general assignment and agreement
--------------------------------
executed by the Participating Lessee for the benefit of the Borrower or
Guarantor who is the particular Property Owner for a Hotel Property to secure
the Participating Lessee's obligations under the Participating Lease for such
Hotel Property, each substantially in the form of Exhibit O with such
modifications as may be necessary and appropriate in the opinion of counsel to
the Agents to comply with the state law of the jurisdiction in which the Hotel
Property is located and as may be reasonably satisfactory to the Agents
(provided any such modification does not materially and adversely affect the
rights and benefits accorded thereunder), as the same may be amended or
terminated in accordance with their terms.
"General Partner" means AGH GP, Inc., a Nevada corporation.
---------------
"Governmental Authority" means any foreign governmental authority, the United
----------------------
States of America, any state of the United States of America and any subdivision
of any of the foregoing, and any agency, department, commission, board,
authority or instrumentality, bureau or court having jurisdiction over any Bank,
the Parent, the Borrower, any Subsidiaries of the Borrower or the Parent, the
Participating Lessee, the Manager or any of their respective Properties.
-14-
"Governmental Proceedings" means any action or proceedings by or before any
------------------------
Governmental Authority, including, without limitation, the promulgation,
enactment or entry of any Legal Requirement.
"Ground Lease" means each of the ground leases or subground leases set forth
------------
on Schedule 1.01(i) hereto and any ground lease for a Future Property acceptable
to the Agents in their sole discretion, together with all right, title and
interest of Borrower or any Subsidiary of Borrower (except the Permitted Other
Subsidiaries), as the case may be, in and to the leasehold estate created
pursuant to each such ground lease as each such ground lease may be amended,
restated, supplemented or otherwise modified from time to time in accordance
with the terms thereof and hereof.
"Ground Lessor Consent" means a Ground Lessor Consent and Agreement
---------------------
acceptable to the Agents and in substantially the form of the attached Exhibit P
or other form approved by the Agents, executed by the then current lessor for
the Ground Lease.
"Guarantor" means Parent and each Subsidiary of the Borrower (except the
---------
Permitted Other Subsidiaries). The Guarantors on the Effective Date are
identified on Schedule 1.01(j).
"Guaranty" means one or more Guaranty and Contribution Agreements in
--------
substantially the form of the attached Exhibit Q executed by the Borrower and
all of the Subsidiaries of the Borrower (including any Permitted New Subsidiary
but excluding the Permitted Other Subsidiaries), evidencing the joint and
several guaranty by the signatories thereto of the obligations of Borrower in
respect of the Credit Documents and the obligations of landlords under
Participating Leases, and any future guaranty and contribution agreement
executed to secure Advances except for Supplemental Guaranties, as any of such
agreements may be amended hereafter in accordance with the terms of such
agreements.
"Hazardous Substance" means the substances identified as such pursuant to
-------------------
CERCLA and those regulated under any other Environmental Law, including without
limitation pollutants, contaminants, petroleum, petroleum products, radio
nuclides, radioactive materials, and medical and infectious waste.
"Hazardous Waste" means the substances regulated as such pursuant to any
---------------
Environmental Law.
"Hotel Capital Lease Limit" means for any Initial Property the amount of
-------------------------
Capital Leases set forth for such Initial Property on Schedule 1.01(k) attached
hereto, and for any Future Property an amount of Capital Leases approved by the
Agents in writing (which approval will not be unreasonably withheld).
-15-
"Hotel Operating Lease Limit" means for any Initial Property the amount of
---------------------------
operating leases set forth for such Initial Property on Schedule 1.01(k)
attached hereto, and for any Future Property an amount of operating leases
approved by the Agents in writing (which approval will not be unreasonably
withheld).
"Hotel Property" for any hotel means the Real Property and the Personal
--------------
Property for such hotel.
"Improvements" for any hotel means all buildings, structures, fixtures,
------------
tenant improvements and other improvements of every kind and description now or
hereafter located in or on or attached to the Land for such hotel; and all
additions and betterments thereto and all renewals, substitutions and
replacements thereof.
"Indebtedness" means (without duplication), at any time and with respect to
------------
any Person, (i) indebtedness of such Person for borrowed money (whether by loan
or the issuance and sale of debt securities) or for the deferred purchase price
of property or services purchased (other than amounts constituting trade
payables or bank drafts payable within 120 days arising in the ordinary course);
(ii) indebtedness of others in the amount which such Person has directly or
indirectly assumed or guaranteed or otherwise provided credit support therefor;
(iii) indebtedness of others in the amount secured by a Lien on assets of such
Person, whether or not such Person shall have assumed such indebtedness; (iv)
obligations of such Person in respect of letters of credit, acceptance
facilities, or drafts or similar instruments issued or accepted by banks and
other financial institutions for the account of such Person (other than trade
payables or bank drafts payable within 120 days arising in the ordinary course);
and (v) obligations of such Person under Capital Leases.
"Initial Properties" means collectively the Hotel Properties listed on
------------------
Schedule 1.01(b), and "Initial Property" means any of such Hotel Properties.
----------------
"Initial Maturity Date" means the date which is the earlier of (i) the date
---------------------
three (3) years from the date hereof or (ii) July 31, 1999.
"Interest Expense" means, for any Person, for any period for which such
----------------
amount is being determined, total interest expense (including that properly
attributable to Capital Leases in accordance with GAAP) and all charges incurred
with respect to letters of credit.
"Interest Period" means, for each LIBOR Rate Advance comprising part of the
---------------
same Borrowing, the period commencing on the date of such Advance or the date of
the Conversion of any Prime Rate Advance into such an Advance and ending on the
last day of the period selected by the Borrower pursuant to the provisions below
and Section 2.02 and, thereafter, each subsequent period commencing on the last
day of the immediately preceding Interest Period and ending on the last day
-16-
of the period selected by the Borrower pursuant to the provisions below and
Section 2.02. The duration of each such Interest Period shall be one, two, or
three months, in each case as the Borrower may select, upon notice received by
the Administrative Agent not later than 11:00 a.m. (Dallas, Texas time) on the
third Business Day prior to the first day of such Interest Period, provided,
--------
however, that:
-------
(a) Interest Periods for Advances of the same Borrowing shall be of the same
duration;
(b) whenever the last day of any Interest Period would otherwise occur on a
day other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day, provided that if such
--------
extension would cause the last day of such Interest Period to occur in the next
following calendar month, the last day of such Interest Period shall occur on
the next preceding Business Day;
(c) any Interest Period which begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of the calendar month in which it would have ended if there were a
numerically corresponding day in such calendar month; and
(d) each successive Interest Period shall commence on the day on which the
next preceding Interest Period expires; and
(e) no Interest Period with respect to any portion of any Advance shall
extend beyond the Maturity Date.
"Irrevocable Direction to Pay Rent" means one or more Irrevocable Direction
---------------------------------
to Pay Rent in substantially the form of the attached Exhibit R executed by the
Parent and all of the Subsidiaries of the Borrower (including any Permitted New
Subsidiary but excluding the Permitted Other Subsidiaries) and acknowledged by
the Participating Lessee, evidencing the direction by the landlords under the
Participating Leases to the Participating Lessee to make rental payments under
the Participating Leases into the Concentration Bank Account, and any future
direction, as any of such directions may be amended hereafter in accordance with
the terms of such directions.
"Issuing Bank" means Bank One, Texas, N.A., or any Bank acting as a successor
------------
issuing bank pursuant to Section 8.06, and "Issuing Banks" means, collectively,
-------------
all of such Banks.
"Land" for any hotel means the real property upon which the hotel is located,
----
together with all rights, title and interests appurtenant to such real property,
including without limitation all rights, title and interests to (a) all strips
and gores within or adjoining such property, (b) ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇,
-▇▇-
sidewalks, alleys, and ways adjacent thereto, (c) all of the tenements,
hereditaments, easements, reciprocal easement agreements, rights-of-way and
other rights, privileges and appurtenances thereunto belonging or in any way
pertaining thereto, (d) all reversions and remainders, (e) all air space rights,
and all water, sewer and wastewater rights, (e) all mineral, oil, gas,
hydrocarbon substances and other rights to produce or share in the production of
anything related to such property, and all other appurtenances appurtenant to
such property, including without limitation, any now or hereafter belonging or
in anywise appertaining thereto.
"Legal Requirement" means any law, statute, ordinance, decree, requirement,
-----------------
order, judgment, rule, regulation (or official interpretation of any of the
foregoing) of, and the terms of any license or permit issued by, any
Governmental Authority.
"Letter of Credit" means, individually, any letter of credit issued by the
----------------
Issuing Bank in accordance with the provisions of Section 2.13 of this
Agreement, and "Letters of Credit" means all such letters of credit
-----------------
collectively.
"Letter of Credit Documents" means, with respect to any Letter of Credit,
--------------------------
such Letter of Credit and any reimbursement or other agreements, documents, and
instruments entered into in connection with or relating to such Letter of
Credit.
"Letter of Credit Exposure" means, at any time, the sum of (a) the aggregate
-------------------------
undrawn maximum face amount of each Letter of Credit at such time and (b) the
aggregate unpaid amount of all Reimbursement Obligations at such time.
"Letter of Credit Obligations" means all obligations of the Borrower arising
----------------------------
in respect of this Agreement or the Letter of Credit Documents.
"LIBOR Lending Office" means, with respect to any Bank, the office of such
--------------------
Bank specified as its "LIBOR Lending Office" opposite its name on Schedule 9.02
(or, if no such office is specified, its Domestic Lending Office) or such other
office of such Bank as such Bank may from time to time specify to the Borrower
and the Administrative Agent.
"LIBOR Rate" means, for the Interest Period for each LIBOR Rate Advance
----------
comprising part of the same Borrowing, an interest rate per annum (rounded
upward to the nearest whole multiple of 1/16 of 1% per annum) equal to (A) the
rate per annum at which deposits in Dollars are offered by the principal office
of the Administrative Agent in London, England to prime banks in the London
interbank market at 11:00 a.m. (London time) three Business Days before the
first day of such Interest Period in an amount substantially equal to the
Administrative Agent's LIBOR Rate Advance comprising part of such Borrowing and
for a period equal to such Interest Period divided
-18-
by (B) one minus the LIBOR Reserve Requirement. It is agreed that for purposes
of this definition, LIBOR Rate Advances made hereunder shall be deemed to
constitute Eurocurrency Liabilities as defined in Regulation D and to be subject
to the reserve requirements of Regulation D.
"LIBOR Rate Advance" means any Advance which bears interest as provided in
------------------
Section 2.06(b).
"LIBOR Reserve Requirement" shall mean, on any day, that percentage
-------------------------
(expressed as a decimal fraction) which is in effect on such date, as provided
by the Federal Reserve System for determining the maximum reserve requirements
generally applicable to financial institutions regulated by the Federal Reserve
Board comparable in size and type to the Administrative Agent (including,
without limitation, basic, supplemental, marginal and emergency reserves) under
Regulation D with respect to "Eurocurrency liabilities" as currently defined as
Regulation D, or under any similar or successor regulation with respect to
Eurocurrency liabilities or Eurocurrency funding (or other category of
liabilities which includes deposits by reference to which the interest rate on a
LIBOR Rate Advance is determined or any category or extensions of credit which
includes loans by a non-United States office of the Administrative Agent to
United States residents). Each determination by the Administrative Agent of the
LIBOR Reserve Requirement, shall, in the absence of manifest error, be
conclusive and binding upon the Borrower.
"Lien" means any mortgage, lien, pledge, charge, deed of trust, security
----
interest, encumbrance or other type of preferential arrangement to secure or
provide for the payment of any obligation of any Person, whether arising by
contract, operation of law or otherwise (including, without limitation, the
interest of a vendor or lessor under any conditional sale agreement, Capital
Lease or other title retention agreement).
"Liquid Investments" means:
------------------
(a) direct obligations of, or obligations the principal of and interest on
which are unconditionally guaranteed by, the United States;
(b) (i) negotiable or nonnegotiable certificates of deposit, time deposits,
or other similar banking arrangements maturing within 180 days from the date of
acquisition thereof ("bank debt securities"), issued by (A) any Bank or (B) any
other bank or trust company which has a combined capital surplus and undivided
profit of not less than $250,000,000 or the Dollar Equivalent thereof, if at the
time of deposit or purchase, such bank debt securities are rated not less than
"A" (or the then equivalent) by the rating service of S&P or of ▇▇▇▇▇'▇
Investors Service, and (ii) commercial paper issued by (A) any Bank or (B) any
other Person if at the time of purchase such commercial paper is rated not less
than "A-2" (or the then equivalent) by the rating service of S&P or not less
than "P-2"
-19-
(or the then equivalent) by the rating service of ▇▇▇▇▇'▇ Investors Service, or
upon the discontinuance of both of such services, such other nationally
recognized rating service or services, as the case may be, as shall be selected
by the Borrower with the consent of the Administrative Agent;
(c) repurchase agreements relating to investments described in clauses (a)
and (b) above with a market value at least equal to the consideration paid in
connection therewith, with any Person who regularly engages in the business of
entering into repurchase agreements and has a combined capital surplus and
undivided profit of not less than $250,000,000 or the Dollar Equivalent thereof,
if at the time of entering into such agreement the debt securities of such
Person are rated not less than "A" (or the then equivalent) by the rating
service of S&P or of ▇▇▇▇▇'▇ Investors Service; and
(d) such other instruments (within the meaning of Article 9 of the Texas
Business and Commerce Code) as the Borrower may request and the Administrative
Agent may approve in writing, which approval will not be unreasonably withheld.
"Liquor License Concession Agreement" means a Lease/Concession Agreement
-----------------------------------
between the Participating Lessee and a Liquor License Company in the form of
Exhibit S attached hereto or such other form as approved by the Agents in
writing.
"Liquor License Companies" means those certain companies listed on Schedule
------------------------
1.01(l) attached hereto and any future company wholly-owned by ▇▇▇▇▇ ▇. ▇▇▇▇▇
having a concession to sell liquor for a Hotel Property approved by the Agents
in writing (which approval will not be unreasonably withheld).
"Liquor License Company Consent" for any Initial Property or Future Property
------------------------------
for which the liquor license(s) for such Hotel Property is held by a Person
(including a Liquor License Company) other than Borrower, a Guarantor owning
such Hotel Property, the Manager or the Participating Lessee, means, a consent
and agreement in the form of Exhibit T attached hereto or such other form as
reasonably approved by the Agents executed by the Liquor License Company.
"Liquor License Pledge Agreement" for any Initial Property or Future Property
-------------------------------
for which the liquor license(s) for such Hotel Property is held by a Person
(including a Liquor License Company) other than Borrower, a Guarantor owning
such Hotel Property, the Manager or the Participating Lessee, means a pledge of
the legal and beneficial ownership interest in such Person to the Participating
Lessee in the form of Exhibit U with such modifications as may be necessary and
appropriate in the opinion of counsel to the Agents to comply with the state law
of the Hotel Property's state and as may be reasonably satisfactory to the
Agents (provided any such modification does not materially and adversely affect
the rights and benefits to be accorded thereunder).
-20-
"Major Renovation" means, for any Hotel Property, renovation of such Hotel
----------------
Property for which the anticipated cost of the Capital Expenditures and FF&E
involved in such renovation equals or exceeds an amount equal to the product of
(a) $15,000 times (b) the number of guest rooms for such Hotel Property.
"Majority Banks" means, at any time, Banks holding at least 66 2/3% of the
--------------
then aggregate unpaid principal amount of the Notes and the Letter of Credit
Exposure of the Banks at such time, or, if no such principal amount of the Notes
and Letter of Credit Exposure is then outstanding, Banks having at least 66 2/3%
of the aggregate amount of the Commitments at such time.
"Management Agreements" means those certain Management Agreements listed on
---------------------
Schedule 4.23 attached hereto and any future management agreement for an
Eligible Property is substantially the same form or as otherwise approved by the
Agents in writing.
"Manager" means American General Hospitality, Inc., a Texas corporation, or
-------
any other manager of a Hotel Property approved by the Agents in writing.
"Manager Consent" means a Manager Consent and Agreement in substantially the
---------------
form of the attached Exhibit V, executed by the Manager for the Hotel Property.
"Manager Controlled Group" means all members of a controlled group of
------------------------
corporations and all trades (whether or not incorporated) under common control
which, together with the Manager, are treated as a single employer under Section
414 of the Code.
"Material Adverse Change" shall mean a material adverse change in the
-----------------------
business, financial condition, or results of operations of (i) the Borrower or
any Guarantor, in each case since the date of the Financial Statements, or (ii)
the Parent, since the date of the Registration Statement.
"Material Lease" means any lease, other than the Participating Lease, either
--------------
(i) demising in excess of 10,000 square feet of the Improvements with respect to
any Hotel Property or (ii) generating in excess of 10% of the gross revenues
with respect to any Hotel Property.
"Maturity Date" means the Initial Maturity Date, unless the Maturity Date is
-------------
extended pursuant to Section 2.01(b), in which event such extended date shall be
the Maturity Date.
"Maximum Rate" means the maximum nonusurious interest rate under applicable
------------
law.
"Meadowlands" means the Courtyard by Marriott-Meadowlands Hotel.
-----------
-21-
"Meadowlands LP" means 455 Meadowland Associates, Ltd., a Texas limited
--------------
partnership.
"Mortgages" means, collectively, the deeds of trust and mortgages executed by
---------
the Borrower or any Guarantor to secure the Obligations, each substantially in
the form of Exhibit W with such modifications as may be necessary and
appropriate in the opinion of counsel to the Agents to comply with the state law
of the filing jurisdiction and as may be reasonably satisfactory to the Agents
(provided any such modification does not materially and adversely affect the
rights and benefits to be accorded to the Administrative Agent for the benefit
of the Banks), as the same may be amended or terminated in accordance with their
terms, and "Mortgage" means any of such instruments.
--------
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
------------------
4001(a)(3) of ERISA to which the Borrower or any member of a Controlled Group is
making or accruing an obligation to make contributions.
"Net Cash Proceeds" means (a) the aggregate cash proceeds (including, without
-----------------
limitation, insurance proceeds) received by the Parent, the Borrower or any of
their respective Subsidiaries (as applicable) in connection with any Asset Sale
or Capitalization Event, minus (b) the reasonable expenses of such Person in
-----
connection with such Asset Sale or such Capitalization Event.
"Net Income" means, for any Person or Hotel Property for any period for which
----------
such amount is being determined, the net income of such Person or Hotel
Property, as applicable, after taxes, as determined in accordance with GAAP,
excluding, however, extraordinary items, including but not limited to (i) any
net gain or loss during such period arising from the sale, exchange, or other
disposition of capital assets (such term to include all fixed assets and all
securities) other than in the ordinary course of business and (ii) any write-up
or write-down of assets.
"Net Worth" means, for any Person, stockholders equity of such Person
---------
determined in accordance with GAAP.
"Note" means a promissory note of the Borrower payable to the order of any
----
Bank, in substantially the form of the attached Exhibit A, evidencing
indebtedness of the Borrower to such Bank resulting from Advances owing to such
Bank, and "Notes means all of such promissory notes.
-----
"Notice of Borrowing" means a notice of borrowing in the form of the attached
-------------------
Exhibit X signed by a Responsible Officer of the Borrower.
"Notice of Conversion or Continuation" means a notice of conversion or
------------------------------------
continuation in the form of the attached Exhibit Y signed by a Responsible
Officer of the Borrower.
-22-
"Obligations" means all Advances, Reimbursement Obligations, and other
-----------
amounts payable by the Borrower to the Structuring Agent, the Administrative
Agent, or the Banks under the Credit Documents.
"Operating Accounts (Borrower)" means (a) a Deposit Account of the Borrower
-----------------------------
to be established and maintained by the Borrower with the Cash Manager at its
offices at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇, Account Name: " American General
Hospitality Operating Partnership, L.P. -Operating Account," and (b) a Deposit
Account of the Property Owner for each Hotel Property (except for DFW South and
Meadowlands) to be established and maintained by the Borrower with the Cash
Manager at its offices at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇, in the name of the
Property Owner.
"Operating Account (Participating Lessee)" means the Deposit Account of the
----------------------------------------
Participating Lessee for each Hotel Property (except for DFW South and
Meadowlands) to be established and maintained by the Participating Lessee with
the Cash Manager at its offices at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇, Account
Name: "AGH Leasing, L.P. - Operating Account [Hotel Property]."
"Parent" means American General Hospitality Corporation, a Maryland
------
corporation.
"Parent Capitalization Event" means any of the following which do not
---------------------------
constitute a Borrower Capitalization Event: (a) any sale or issuance by the
Parent or any of its Subsidiaries of equity securities, or (b) any issuance or
incurrence by the Parent of any Indebtedness.
"Parent Common Stock" means the common stock of Parent, par value $.01 per
-------------------
share.
"Parent's Other Subsidiaries" means all Subsidiaries of the Parent except for
---------------------------
the Borrower and the Subsidiaries of the Borrower.
"Participating Leases" means those certain Participating Leases listed on
--------------------
Schedule 1.01(m) attached hereto and any future participating lease for an
Eligible Property approved by the Agents in writing (which approval shall not
be unreasonably withheld as long as such Person is at least 65% owned by the
same individuals required of a Participating Lessee pursuant to the provisions
of Section 7.01(r).
"Participating Lessee" means AGH Leasing, L.P., a Delaware limited
--------------------
partnership and any future participating lessee for a Hotel Property approved
by the Agents in writing.
-23-
"Participating Lessee Controlled Group" means all members of a controlled
-------------------------------------
group of corporations and all trades (whether or not incorporated) under common
control which, together with the Participating Lessee, are treated as a single
employer under Section 414 of the Code.
"Participating Lessee Estoppel" means a Lessee Estoppel, Acknowledgment and
-----------------------------
Subordination Agreement in substantially the form of the attached Exhibit Z,
executed by the Participating Lessee for the Hotel Property.
"Participating Lessee Documents" for any Initial Property or Future Property,
------------------------------
means collectively (a) an Assignment of Leases (Participating Lessee), (b) a
General Assignment, (c) Financing Statements (Participating Lessee), (d) an
Assignment of Management Agreements, (e), a Depository Account Agreement, (f)
the Credit Card Agreements for such Hotel Property, and (i) such other security
agreements, pledge agreements, assignments, mortgages, financing statements,
stock powers, and other collateral documentation as may be reasonably needed to
confirm or perfect the liens and security interests conveyed to such Hotel
Property's Property Owner pursuant to any of the documents listed in clauses in
(a)-(f) of this definition.
"Participating Lessee Pledged Property" means, for any Hotel Property, the
-------------------------------------
Property of the Participating Lessee assigned or pledged to the Property Owner
of such Hotel Property pursuant to the Participating Lessee Documents for such
Hotel Property.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
----
succeeding to any or all of its functions under ERISA.
"Permitted Encumbrances" means the Liens permitted to exist pursuant to
----------------------
Section 6.01.
"Permitted Hazardous Substances" means (a) Hazardous Substances, petroleum
------------------------------
and petroleum products which are (i) used in the ordinary course of business and
in typical quantities for a mid-market hotel and (ii) generated, used and
disposed of in accordance with all Legal Requirements and good hotel industry
practice and (b) non-friable asbestos to the extent (i) that no applicable Legal
Requirements require removal of such asbestos from the Hotel Property and (ii)
such asbestos is encapsulated in accordance with all applicable Legal
Requirements and such reasonable operations and maintenance program as may be
required by the Agents.
"Permitted Hotel Sale" means the Asset Sale of all, but not a portion, of a
--------------------
Hotel Property for which the Conditions to Collateral Release are satisfied.
"Permitted New Subsidiary" means a Subsidiary at least 99% of the interests
------------------------
therein are owned directly or indirectly by the Borrower which (a) owns a Hotel
Property and does not own and has
-24-
never owned any Property except for such Hotel Property, (b) has delivered to
the Administrative Agent either (i) an original Guaranty and Environmental
Indemnity executed by such Subsidiary or (ii) an Accession Agreement executed by
such Subsidiary, and (c) is newly-formed and bankruptcy remote.
"Permitted Non-Eligible Property" means any Hotel Property (a) which either
-------------------------------
(i) does not satisfy the conditions to qualifying as an Eligible Property set
---
forth in Section 3.04 or (ii) has not been submitted to the Banks as a potential
Eligible Property by the Borrower; (b) which is owned by a Permitted New
Subsidiary; (c) which neither is subject to any Environmental Claim, nor
contains any Hazardous Substance which could reasonably be expected to cause a
Material Adverse Change as evidenced by an Environmental Report delivered to the
Administrative Agent at least 10 days prior to the acquisition of such Hotel
Property by Borrower or one of Borrower's Subsidiaries; (d) for which the
Borrower or the Property Owner (as applicable) shall have satisfied the
conditions precedent set forth in Sections 3.04(a)(i)-(iv), 3.04(a)(vi),
3.04(b)-(c), 3.04(h), 3.04(j), and 3.04(o) within 90 days of the acquisition
date of such Hotel Property, provided that if any of the requirements of this
clause (d) with respect to a Future Property (but not an Initial Property) shall
result in the payment of material mortgage or intangible taxes or in a Material
Adverse Change, the Borrower or the Property Owner (as applicable) shall not
have to satisfy the condition[s] precedent which would result in the payment of
material mortgage or intangible taxes or in a Material Adverse Change until the
occurrence of an Event of Default; (e) which is not subject to any Liens except
for those permitted pursuant to the provisions of Section 6.01; and (f) which
would if considered with the other Permitted Non-Eligible Properties, if any, as
an Eligible Property for the purpose of testing the Pool Requirements, not cause
the Borrower to violate the Pool Requirements.
"Permitted Other Subsidiaries" means (a) DFW South LP; (b) Meadowlands LP;
----------------------------
(c) AGH DFW South LLC, the sole general partner of DFW South LP; (d) AGH
Secaucaus LLC, the sole general partner of Meadowlands LP and (c) such other
Subsidiaries of the Borrower which will not be Guarantors and not own Eligible
Property, as may be approved by the Agents in their sole discretion.
"Permitted Other Subsidiary Indebtedness" means (a) any Indebtedness of DFW
---------------------------------------
South LP in an amount not to exceed $14,250,000; and (b) any Indebtedness of
Meadowlands LP in an amount not to exceed $6,000,000.
"Permitted Other Subsidiary Loan Documents" means the notes, the deeds of
-----------------------------------------
trust, mortgages and the other loan documents executed in connection with or
securing the Permitted Other Subsidiary Indebtedness.
"Permitted Personal Property Replacement" means the removal from any Hotel
---------------------------------------
Property of any items of tangible Personal Property for which the following
requirements are met: (a) no Default has
-25-
occurred and is continuing or would occur upon the consummation of such
Permitted Personal Property Replacement; and (ii) Borrower promptly substitutes
and installs on the Hotel Property other Personal Property of equal or greater
value in the operation of the Hotel Property as a hotel of the class of the
Hotel Property prior to such removal, all of which items shall be free of Liens
and shall be subject to the Liens of the Mortgage encumbering such Hotel
Property, and executes and delivers to the Administrative Agent all documents
required by the Administrative Agent to create and perfect a valid and binding
first priority security interest and the attachment of such Lien to such
Personal Property in favor of the Administrative Agent for the benefit of the
Banks.
"Person" means an individual, partnership, corporation (including a business
------
trust), joint stock company, trust, unincorporated association, limited
liability company, joint venture or other entity, or a government or any
political subdivision or agency thereof or any trustee, receiver, custodian or
similar official.
"Personal Property" for any Hotel Property means all FF&E, inventory and
-----------------
other personal property of every kind, whether now existing or hereafter
acquired, tangible and intangible, now or hereafter located on or about the
Land, and used or to be used in the future in connection with the operation of
such Hotel Property, as more fully described in the Property Security Documents
and the Participating Lessee Documents for such Hotel Property.
"Plan" means an employee benefit plan (other than a Multiemployer Plan)
----
maintained for employees of the Borrower or any member of a Controlled Group and
covered by Title IV of ERISA or subject to the minimum funding standards under
Section 412 of the Code.
"Pool Requirements" means collectively that (a) the Cost Basis for any
-----------------
individual Hotel Property shall not exceed 20% of the Cost Basis for all
Eligible Property; (b) the Cost Basis for all Eligible Property at all times
must exceed $150,000,000; (c) the Cost Basis for Hotel Properties which are
limited service hotels (for purposes of this definition Marriott Courtyards
shall not be deemed limited service hotels) shall not exceed 20% of the Cost
Basis for all Eligible Property; (d) the Cost Basis for Hotel Properties which
do not have Franchise Agreements shall not exceed 20% of the Cost Basis for all
Eligible Property; (e) the occupancy levels, operating revenues and geographic
diversity of the Eligible Property shall be generally comparable to that of the
Initial Properties taken as whole; (f) no Hotel Property or other Property shall
cause the Parent to forfeit the Parent's tax status as a real estate investment
trust under Sections 856-860 of the Code, and (g) any Future Property shall be
comparable in quality to the Initial Properties.
"Prime Rate" means a fluctuating interest rate per annum as shall be in
----------
effect from time to time equal to the rate of interest publicly announced by the
Administrative Agent as its prime commercial
-26-
lending rate (which may not be the lowest rate offered to its customers),
whether or not the Borrower has notice thereof.
"Prime Rate Advance" means an Advance which bears interest as provided in
------------------
Section 2.06(a).
"Property" of any Person means any property or assets (whether real,
--------
personal, or mixed, tangible or intangible) of such Person.
"Property Adjustment Report" means a certificate of the Borrower in
--------------------------
substantially the form of the attached Exhibit AA.
"Property Certificate" for any Hotel Property means a Property Certificate
--------------------
dated of even date herewith executed by the Property Owner in substantially the
form of Exhibit BB, and any future Property Certificate executed by a Property
Owner of any Future Property.
"Property EBITDA" means for any Hotel Property for any period for which such
---------------
amount is being determined, the EBITDA of the Property Owner for such Hotel
Property from such Hotel Property. Property EBITDA shall expressly exclude the
Participating Lessee's Net Income for such Hotel Property.
"Property Information" for any Hotel Property means the information and
--------------------
documentation for such Hotel Property listed in Sections 3.04(a)(ii)-(xiv) and
3.04(f) and a commitment for a Title Policy for such Hotel Property, together
with a legible copy of all documents referred to in such commitment.
"Property Owner" for any Initial Property or Future Property, means the
--------------
Person who owns fee or leasehold title interest (as applicable) in, and to such
Property.
"Property Security Documents" for any Initial Property or Future Property,
---------------------------
means collectively (a) a Mortgage, (b) an Assignment of Leases (Borrower), (c)
Financing Statements (Borrower), (d) a Collateral Assignment and Security
Agreement, (e) the Liquor License Company Consent, (f) a Property Certificate
and (h) such other security agreements, pledge agreements, assignments,
mortgages, financing statements, stock powers, and other collateral
documentation as the Agents may reasonably request.
"Pro Rata Share" means, at any time with respect to any Bank, either (a) the
--------------
ratio (expressed as a percentage) of such Bank's Commitment at such time to the
aggregate Commitments at such time or (b) if the Commitments have been
terminated, the ratio (expressed as a percentage) of such Bank's aggregate
outstanding Advances and participation interest in the Letter of Credit Exposure
at such
-27-
time to the aggregate outstanding Advances and Letter of Credit Exposure of all
the Banks at such time.
"Public Offering" means the initial public offering of approximately
---------------
7,500,000 shares of Parent Common Stock pursuant to the Registration Statement.
"Public Offering Documents" means the collective reference to the
-------------------------
Registration Statement and each certificate, opinion, agreement, instrument or
other document delivered by Parent or any underwriter pursuant thereto.
"Real Estate Value" means, with respect to any Hotel Property, the lesser of
-----------------
(a) the appraised value of such Hotel Property under the most recent Appraisal
for such Hotel Property (appraised value will initially be based upon the "As
Is" value of a Hotel Property and will be based upon the "As Improved" value of
a Hotel Property once the Capital Expenditures are completed in accordance with
the Approved Preliminary Property Plan for such Hotel Property which values for
the Initial Properties are set forth in Schedule 1.01(b)), and (b) the Cost
Basis of such Hotel Property as of the date of the most recent Borrowing Base
Certificate (or, if applicable, Property Adjustment Report) delivered to the
Banks.
"Real Property" for any hotel means the Land and the Improvements for such
-------------
hotel.
"Refund Amount" means for any calendar quarter prior to July 1, 1997 an
-------------
amount (but in no event less than zero) equal to (a) $62,500 minus (b) an amount
-----
equal to (i) one quarter of one percent (.25%) times (ii) the average daily
amount (based on a 360 day year) in such quarter by which the Banks' aggregate
Commitments exceed the sum of the Banks' outstanding Advances and the Letter of
Credit Exposure (as calculated by the Administrative Agent).
"Register" has the meaning set forth in paragraph (c) of Section 9.06.
--------
"Registration Statement" means Registration Statement (No. 333-4596) of
----------------------
Parent on Form S-11 and the prospectus included therein, as filed with the
Securities and Exchange Commission on May 3, 1996, as it may be amended or
supplemented from time to time.
"Reimbursement Obligations" means all of the obligations of the Borrower set
-------------------------
forth in Section 2.13(c) and the Letter of Credit Documents.
"Release" shall have the meaning set forth in CERCLA or under any other
-------
Environmental Law.
-28-
"Release Amount" shall in connection with any Asset Sale mean the greater of
--------------
(a) one-hundred twenty percent (120%) of the Allocated Debt Amount for the Hotel
Property in such Asset Sale, (b) seventy-five percent (75%) of the Net Cash
Proceeds from such Asset Sale, (c) the amount of Advances that would need to be
repaid, if any, to cure a Borrowing Base deficiency under Section 2.07(c)(iii),
and (d) the amount of Advances that would need to be repaid, if any, to satisfy
the financial covenants contained in Sections 6.15 and 6.16 calculating such
tests without inclusion of the results of the Hotel Property in such Asset Sale.
Notwithstanding the foregoing, if an Asset Sale occurs during the Renewal Term
and in connection with such Asset Sale all of the Conditions to Collateral
Release are satisfied except for the payment of the Release Amount, then the
"Release Amount" for such Asset Sale shall not exceed the amount which would
cause the Parent to forfeit the Parent's tax status as a real estate investment
trust under Sections 856-860 of the Code, as evidenced by a written opinion of
the Parent's accountants or legal counsel acceptable to the Agents.
"Renewal Term" shall have the meaning set forth in Section 2.01(b).
------------
"Reportable Event" means any of the events set forth in Section 4043(b) of
----------------
ERISA.
"Required Work" means for any Initial Property, the Capital Expenditures and
-------------
expenditures for FF&E for such Initial Property described on Schedule 5.06
attached hereto as may be modified by agreement between the Borrower and the
Majority Banks, and for any Future Property which the Borrower requests be an
Eligible Property, the Capital Expenditures and expenditures for FF&E agreed
upon by the Borrower and the Majority Banks as the Required Work for such Future
Property, if any.
"Required Work Deadline" means for any Initial Property, the date for
----------------------
completion of the Required Work which is one year following the date of this
Agreement, and for any Future Property, the date for completion of the Required
Work which is the date which is one year following the date of acquisition of
such Future Property.
"Response" shall have the meaning set forth in CERCLA or under any other
--------
Environmental Law.
"Responsible Officer" means the Chief Executive Officer, President, Executive
-------------------
Vice President or Chief Financial Officer of any Person.
"Restricted Payment" means (a) any direct or indirect payment, prepayment,
------------------
redemption, purchase, or deposit of funds or Property for the payment (including
any sinking fund or defeasance), prepayment, redemption or purchase of
Indebtedness not permitted by this Agreement, and (b) the making by any Person
of any dividends or other distributions (in cash, property, or otherwise) on,
-29-
or payment for the purchase, redemption or other acquisition of, any shares of
any capital stock of such Person, other than dividends payable in such Person's
stock.
"Rolling Period" means with respect to any calendar quarter of the Borrower,
--------------
such fiscal quarter and the three immediately preceding calendar quarters.
"S&P" means Standard & Poor's Ratings Group, a division of ▇▇▇▇▇▇-▇▇▇▇, Inc.,
---
or any successor thereof.
"Security Agreement" means the Security Agreement dated of even date herewith
------------------
executed by the Borrower and the Guarantors in substantially the form of Exhibit
CC, as it may be amended from time to time in accordance with its terms.
"Security Documents" means, collectively, the Security Agreement, all
------------------
Property Security Documents, the Bank One Cash Management Agreement, the
Irrevocable Direction to Pay Rent, all Financing Statements (Borrower) and any
other agreement executed in connection with the Liens in favor of the
Administrative Agent for the benefit of the Banks securing the Obligations; and
any "Security Document" means any one of the foregoing.
"Structuring Agent" means Societe Generale, Southwest Agency in its capacity
-----------------
as Structuring Agent for the Banks pursuant to Article VIII and any successor
Structuring Agent pursuant to Section 8.06.
"Subsidiary" of a Person means any corporation, association, partnership or
----------
other business entity of which more than 50% of the outstanding shares of
capital stock (or other equivalent interests) having by the terms thereof
ordinary voting power under ordinary circumstances to elect a majority of the
board of directors or Persons performing similar functions (or, if there are no
such directors or Persons, having general voting power) of such entity
(irrespective of whether at the time capital stock (or other equivalent
interests) of any other class or classes of such entity shall or might have
voting power upon the occurrence of any contingency) is at the time directly or
indirectly owned or controlled by such Person, by such Person and one or more
Subsidiaries of such Person or by one or more Subsidiaries of such Person.
"Supplemental Guarantor" means any partner of the Borrower except for the
----------------------
Parent, the Guarantors, the General Partner or AGH LP that executes a
Supplemental Guaranty.
"Supplemental Guaranty" means any future assumption of liability in a form
---------------------
reasonably acceptable to the Agents executed by a Supplemental Guarantor to
secure Advances, as such future supplemental guaranties may be amended hereafter
in accordance with their terms.
-30-
"Termination Event" means (a) the occurrence of a Reportable Event with
-----------------
respect to a Plan, as described in Section 4043 of ERISA and the regulations
issued thereunder (other than a Reportable Event not subject to the provision
for 30-day notice to the PBGC under such regulations), (b) the withdrawal of the
Borrower or any of a Controlled Group from a Plan during a plan year in which it
was a "substantial employer" as defined in Section 4001(a)(2) of ERISA, (c) the
giving of a notice of intent to terminate a Plan under Section 4041(c) of ERISA,
(d) the institution of proceedings to terminate a Plan by the PBGC, or (e) any
other event or condition which constitutes grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any Plan.
"Title Policy" means a Mortgagee Policy of Title Insurance which (a) is in
------------
the form of American Land Title Association Standard Loan Policy - 1970 (without
modification, revision or amendment) (or such other form as approved by the
Agents) with ALTA Endorsements Form 1, 3.1 (with parking), 6, 9, and
endorsements commonly known Doing Business, Usury, Utility Facility, contiguity,
survey, access, creditor's rights deletion, plat act, revolver, "tie-in" and
specific endorsements relating to encroachments, (b) is issued by underwriters
reasonably acceptable to the Agents, with such reinsurance as the Agents shall
reasonably request, (c) insures that the grantor of the Lien insured by such
policy owns the Real Property subject to such Lien in fee simple or pursuant to
a leasehold estate and that the Mortgage covering the Real Property is a valid
lien on the Real Property in favor of the Administrative Agent for the benefit
of the Banks (subject only to Permitted Encumbrances), (d) does not contain any
exceptions for rights of parties in possession, or unpaid delinquent
installments of taxes, special assessments or subsequent assessments due to
changes in ownership or usage, or any other exceptions to coverage other than
Permitted Encumbrances.
"Total Collateral EBITDA" means for any period the aggregate Property EBITDA
-----------------------
of all Eligible Properties and all Permitted Non-Eligible Properties.
"Type" has the meaning set forth in Section 1.04.
----
Section 1.02 Computation of Time Periods. In this Agreement in the
---------------------------
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".
Section 1.03 Accounting Terms; Changes in GAAP.
---------------------------------
(a) All accounting terms not specifically defined in this Agreement shall be
construed in accordance with GAAP applied on a consistent basis with those
applied in the preparation of the Financial Statements.
-31-
(b) Unless otherwise indicated, all financial statements of the Borrower and
the Parent, all calculations for compliance with covenants in this Agreement,
and all calculations of any amounts to be calculated under the definitions in
Section 1.01 shall be based upon the Consolidated accounts of the Borrower, the
Parent and their respective Subsidiaries (as applicable) in accordance with
GAAP.
(c) If any changes in accounting principles after December 31, 1995 required
by GAAP or the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants or similar agencies results in a change in the
method of calculation of, or affects the results of such calculation of, any of
the financial covenants, standards or terms found in this Agreement, then the
parties shall enter into and diligently pursue negotiations in order to amend
such financial covenants, standards or terms so as to equitably reflect such
change, with the desired result that the criteria for evaluating the financial
condition of Borrower and its Subsidiaries (determined on a Consolidated basis)
shall be the same after such change as if such change had not been made.
Section 1.04 Types of Advances. Advances are distinguished by "Type". The
-----------------
"Type" of an Advance refers to the determination whether such Advance is a LIBOR
Rate Advance or Prime Rate Advance, each of which constitutes a Type.
Section 1.05 Miscellaneous. Article, Section, Schedule and Exhibit
-------------
references are to Articles and Sections of and Schedules and Exhibits to this
Agreement, unless otherwise specified.
ARTICLE II
THE ADVANCES AND THE LETTERS OF CREDIT
Section 2.01 The Advances; Extension of Initial Maturity Date.
------------------------------------------------
(a) Advances. Each Bank severally agrees, on the terms and conditions set
--------
forth in this Agreement, to make Advances to the Borrower from time to time on
any Business Day up to 30 days prior to the Initial Maturity Date in an
aggregate amount not to exceed at any time outstanding an amount equal to such
Bank's Commitment less such Bank's Pro Rata Share of the Letter of Credit
----
Exposure at such time. The aggregate amount of all outstanding Advances and
Letter of Credit Exposure at any time may not exceed either the lesser of (i)
the aggregate Commitments at such time or (ii) the Borrowing Base at such time.
Within the limits of each Bank's Commitment and the Borrowing Base limitation
set forth above, the Borrower may from time to time prepay pursuant to Section
2.07 and reborrow under this Section 2.01(a).
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(b) Extension of Initial Maturity Date. The Borrower shall have a one time
----------------------------------
option, exercisable as hereinafter provided, to extend the Initial Maturity Date
of the Notes for an additional one year period (the "Renewal Term") to the first
anniversary of the Initial Maturity Date upon the completion by the Borrower of
the following conditions prior to the Initial Maturity Date to the satisfaction
of the Agents.
(i) No Default which has not been cured or waived in writing by the
Administrative Agent as set forth in Section 9.01 shall have occurred.
(ii) The Agents shall have received no later than ninety (90) days prior
to the Initial Maturity Date written notice from the Borrower that it
intends to exercise its option to extend the Initial Maturity Date of the
Notes.
(iii) The Borrower shall have paid to the Administrative Agent for the
account of each Bank an extension fee equal to the product of (A) one
quarter of one percent (1/4%) times (B) the aggregate amount of such Bank's
outstanding Advances and Pro Rata Share of the Letter of Credit Exposure as
of the Initial Maturity Date.
(iv) The Borrower shall have delivered to the Administrative Agent (A)
Appraisals of the Eligible Property performed no later than 120 days prior
to the Initial Maturity Date and no earlier than 90 days prior to the
Initial Maturity Date and (B) a Borrowing Base Certificate dated as of the
Initial Maturity Date based upon the new Appraisals.
(v) If, based upon the Borrowing Base Certificate to be delivered to the
Administrative Agent pursuant to the preceding clause (iv) or as otherwise
required under this Agreement, the Borrower is obligated to repay any
Advances, the Borrower shall have repaid such Advances.
(vi) The representations and warranties of the Borrower in Sections
4.04, 4.06 and 4.09 of the Credit Agreement remain true and correct as of
the Initial Maturity Date. The other representations and warranties of the
Borrower, the Parent and the Guarantors in the Credit Documents remain true
and correct in all material respects as of the Initial Maturity Date.
If the Initial Maturity Date has been extended as provided in this Section
2.01(b), the aggregate Banks' Commitments shall be capped at the then
outstanding principal balance of all Advances and the Letter of Credit Exposure
and the Borrower shall have the right to extend the Expiration Date to the new
Maturity Date. After the Initial Maturity Date, the Borrower will no longer
have the right to request any more Advances, or any increase in the Letter of
Credit Exposure and shall repay the Advances in accordance with the provisions
of Section 2.05.
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Section 2.02 Method of Borrowing.
-------------------
(a) Notice. Each Borrowing shall be made pursuant to a Notice of Borrowing,
------
given not later than 11:00 a.m. (Dallas, Texas time) on the third Business Day
before the date of the proposed Borrowing, by the Borrower to the Administrative
Agent, which shall give each Bank prompt notice on the day of receipt of such
timely Notice of Borrowing of such proposed Borrowing by telecopier. Each Notice
of Borrowing shall be in writing or by telecopier specifying the requested (i)
date of such Borrowing, (ii) Type of Advances comprising such Borrowing, (iii)
aggregate amount of such Borrowing, and (iv) if such Borrowing is to be
comprised of LIBOR Rate Advances, the Interest Period for each such Advance. In
the case of a proposed Borrowing comprised of LIBOR Rate Advances, the
Administrative Agent shall promptly notify each Bank of the applicable interest
rate under Section 2.06(b). Each Bank shall, before 11:00 a.m. (Dallas, Texas
time) on the date of such Borrowing, make available for the account of its
Applicable Lending Office to the Administrative Agent at its address referred
to in Section 9.02, or such other location as the Administrative Agent may
specify by notice to the Banks, in same day funds, such Bank's Pro Rata Share of
such Borrowing. After the Administrative Agent's receipt of such funds and upon
fulfillment of the applicable conditions set forth in Article III, the
Administrative Agent will make such funds available to the Borrower at its
account with the Administrative Agent.
(b) Conversions and Continuations. In order to elect to Convert or continue
-----------------------------
Advances comprising part of the same Borrowing under this Section, the Borrower
shall deliver an irrevocable Notice of Conversion or Continuation to the
Administrative Agent at the Administrative Agent's office no later than 11:00
a.m. (Dallas, Texas time) at least three Business Days in advance of the
proposed Conversion or continuation date. Each such Notice of Conversion or
Continuation shall be in writing or by telecopier, specifying (i) the requested
Conversion or continuation date (which shall be a Business Day), (ii) the
Borrowing amount and Type of the Advances to be Converted or continued, (iii)
whether a Conversion or continuation is requested, and if a Conversion, into
what Type of Advances, and (iv) in the case of a Conversion to, or a
continuation of, LIBOR Rate Advances, the requested Interest Period. Promptly
after receipt of a Notice of Conversion or Continuation under this paragraph,
the Administrative Agent shall provide each Bank with a copy thereof and, in
the case of a Conversion to or a continuation of LIBOR Rate Advances, notify
each Bank of the applicable interest rate under Section 2.06(b). For purposes
other than the conditions set forth in Section 3.02, the portion of Advances
comprising part of the same Borrowing that are Converted to Advances of another
Type shall constitute a new Borrowing. If the Borrower shall fail to specify an
Interest Period for a LIBOR Rate Advance including the continuation of a LIBOR
Rate Advance, the Borrower shall be deemed to have selected a Prime Rate
Advance.
(c) Certain Limitations. Notwithstanding anything in paragraphs (a) and (b)
-------------------
above:
-34-
(i) in the case of LIBOR Rate Advances each Borrowing shall be in an
aggregate amount of not less than $2,000,000 or greater multiples of
$100,000;
(ii) except for Borrowings for the acquisition of Future Properties by
the Borrower or a Permitted New Subsidiary, (A) the Borrower may not
request Borrowings on more than two days in any calendar month, and (B) the
Borrower shall not request more than one Borrowing in any calendar month
for the payment of Capital Expenditures and FF&E in connection with a Major
Renovation and any such request in connection with a Major Renovation shall
be made contemporaneously with any request to withdraw funds from the CAPEX
Reserve as set forth in Section 5.07 in such month and shall be accompanied
by the same documentation as required for a withdraw from the CAPEX
Reserve.
(iii) at no time shall there be more than three Interest Periods
applicable to outstanding LIBOR Rate Advances;
(iv) the Borrower may not select LIBOR Rate Advances for any Borrowing
to be made, Converted or continued if a Default has occurred and is
continuing;
(v) if any Bank shall, at any time prior to the making of any requested
Borrowing comprised of LIBOR Rate Advances, notify the Administrative Agent
that the introduction of or any change in or in the interpretation of any
law or regulation makes it unlawful, or that any central bank or other
governmental authority asserts that it is unlawful, for such Bank or its
LIBOR Lending Office to perform its obligations under this Agreement to
make LIBOR Rate Advances or to fund or maintain LIBOR Rate Advances, then
such Bank's Pro Rata Share of such Borrowing shall be made as a Prime Rate
Advance, provided that such Prime Rate Advance shall be considered part of
the same Borrowing and interest on such Prime Rate Advance shall be due and
payable at the same time that interest on the LIBOR Rate Advances
comprising the remainder of such Borrowing shall be due and payable; and
such Bank agrees to use commercially reasonable efforts (consistent with
its internal policies and legal and regulatory restrictions) to designate a
different Applicable Lending Office if the making of such designation would
avoid the effect of this paragraph and would not, in the reasonable
judgment of such Bank, be otherwise materially disadvantageous to such
Bank;
(vi) if the Administrative Agent is unable to determine the LIBOR Rate
for LIBOR Rate Advances comprising any requested Borrowing, the right of
the Borrower to select LIBOR Rate Advances for such Borrowing or for any
subsequent Borrowing shall be suspended until the Administrative Agent
shall notify the Borrower and the Banks that the circumstances causing such
suspension no longer exist, and each Advance comprising such Borrowing
shall be a Prime Rate Advance;
-35-
(vii) if the Majority Banks shall, at least one Business Day before the
date of any requested Borrowing, notify the Administrative Agent that the
LIBOR Rate for LIBOR Rate Advances comprising such Borrowing will not
adequately reflect the cost to such Banks of making or funding their
respective LIBOR Rate Advances, as the case may be, for such Borrowing, the
right of the Borrower to select LIBOR Rate Advances for such Borrowing or
for any subsequent Borrowing shall be suspended until the Administrative
Agent shall notify the Borrower and the Banks that the circumstances
causing such suspension no longer exist, and each Advance comprising such
Borrowing shall be a Prime Rate Advance; and
(viii) if the Borrower shall fail to select the duration or
continuation of any Interest Period for any LIBOR Rate Advances in
accordance with the provisions contained in the definition of "Interest
Period" in Section 1.01 and paragraph (a) or (b) above, the Administrative
Agent will forthwith so notify the Borrower and the Banks and such Advances
will be made available to the Borrower on the date of such Borrowing as
Prime Rate Advances or, if an existing Advance, Converted into Prime Rate
Advances.
(d) Notices Irrevocable. Each Notice of Borrowing and Notice of Conversion
-------------------
or Continuation shall be irrevocable and binding on the Borrower. In the case
of any Borrowing which the related Notice of Borrowing specifies is to be
comprised of LIBOR Rate Advances, the Borrower shall indemnify each Bank against
any loss, out-of-pocket cost or expense incurred by such Bank as a result of any
condition precedent for Borrowing set forth in Article III not being satisfied
for any reason, including, without limitation, any loss, cost or expense
actually incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Bank to fund the Advance to be made by such Bank as
part of such Borrowing when such Advance, as a result of such failure, is not
made on such date.
(e) Administrative Agent Reliance. Unless the Administrative Agent shall
-----------------------------
have received notice from a Bank before the date of any Borrowing that such Bank
will not make available to the Administrative Agent such Bank's Pro Rata Share
of the Borrowing, the Administrative Agent may assume that such Bank has made
its Pro Rata Share of such Borrowing available to the Administrative Agent on
the date of such Borrowing in accordance with paragraph (a) of this Section 2.02
and the Administrative Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount. If and to the
extent that such Bank shall not have so made its Pro Rata Share of such
Borrowing available to the Administrative Agent, such Bank and the Borrower
severally agree to immediately repay to the Administrative Agent on demand such
corresponding amount, together with interest on such amount, for each day from
the date such amount is made available to the Borrower until the date such
amount is repaid to the Administrative Agent, at (i) in the case of the
Borrower, the interest rate applicable on each such day to Advances comprising
such Borrowing and (ii) in the case of such Bank, the Federal Funds Rate for
each such
-36-
day. If such Bank shall repay to the Administrative Agent such corresponding
amount and interest as provided above, such corresponding amount so repaid shall
constitute such Bank's Advance as part of such Borrowing for purposes of this
Agreement even though not made on the same day as the other Advances comprising
such Borrowing.
(f) Bank Obligations Several. The failure of any Bank to make the Advance
------------------------
to be made by it as part of any Borrowing shall not relieve any other Bank of
its obligation, if any, to make its Advance on the date of such Borrowing. No
Bank shall be responsible for the failure of any other Bank to make the Advance
to be made by such other Bank on the date of any Borrowing.
(g) Notes. The indebtedness of the Borrower to each Bank resulting from
-----
Advances owing to such Bank shall be evidenced by the Note of the Borrower
payable to the order of such Bank in substantially the form of Exhibit A.
Section 2.03 Fees.
----
(a) Initial Funding Fees; Bank Refund. If the Borrower delivers the
---------------------------------
Borrower Funding Certificate, the Banks make an Advance hereunder or any Issuing
Bank issues a Letter of Credit hereunder, the Borrower agrees to pay to the
Administrative Agent for the account of each Bank on the date of the earliest to
occur of such events an initial funding fee equal to $1,000,000. The
Administrative Agent shall hold $250,000 of such fee in escrow to be used to pay
the Refund Amount to the Borrower and certain sums to the Banks as hereinafter
provided. If the Borrower has paid such initial funding fee as provided herein
and no Default exists, within 30 days of the end of the calendar quarters ending
September 30, 1996, December 31, 1996, March 31, 1997 and June 30, 1997, the
Administrative Agent shall calculate the Refund Amount for such calendar
quarter. After calculation of the Refund Amount for any calendar quarter the
Administrative Agent will first pay to each Bank out of the escrowed $250,000
such Bank's Pro Rata Share of an amount equal to (i) $62,500 minus (ii) the
-----
Refund Amount for such calendar quarter and second pay to the Borrower on behalf
of the Banks out of such escrowed sums an amount equal to the Refund Amount.
Any sums remaining in such escrowed account after the aforementioned payments
for all four of the stated calendar quarters shall be refunded to the Borrower.
(b) Commitment Fees. For the period from July 1, 1997 until the Initial
---------------
Maturity Date the Borrower agrees to pay to the Administrative Agent for the
account of each Bank a commitment fee on the average daily amount by which such
Bank's Commitment exceeds the sum of such Bank's outstanding Advances and Pro
Rata Share of the Letter of Credit Exposure at a rate per annum equal to one
quarter of one percent (.25%). Such fees shall be due and payable quarterly in
arrears (i) on the date which is 30 days following the end of the last Business
Day of each March, June, September and December and (ii) on the Initial Maturity
Date.
-37-
(c) Letter of Credit Fees. The Borrower agrees to pay to the Administrative
---------------------
Agent for the account of the Banks, fees in respect of all Letters of Credit
outstanding at a rate per annum equal to one and 85/100 percent (1.85%)
calculated based upon a 360-day year and in respect of the maximum amount
available from time to time to be drawn under such outstanding Letters of
Credit, payable in arrears (i) on the last Business Day of each calendar month
and (ii) on the Maturity Date. In addition, the Borrower agrees to pay to the
Issuing Bank for its own account $500 for each Letter of Credit issued,
reissued, amended, increased, or extended by such Issuing Bank, such fees due
and payable at the time of such issuance, reissuance, amendment, increase or
extension.
(d) Agents Fees. The Borrower agrees to pay to the Agents for their benefit
-----------
the fees set forth in the Agents' Fee Letter as and when the same are due and
payable pursuant to the terms of the Agent's Fee Letter.
Section 2.04 Reduction of the Commitments.
----------------------------
(a) Change of Control. Upon the occurrence of any of the following:
-----------------
(i) a change in control is reported by the Borrower, the Parent, a
Participating Lessee or the Manager in response to either Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Securities
Exchange Act of 1934 (the "Exchange Act"), or
(ii) any "person" (as such term is used in Section 13(d) and
Section 14(d)(2) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Borrower, the Parent, a Participating
Lessee or the Manager representing the Control Percentage or more of
the combined voting power of the Borrower's, the Parent's, a
Participating Lessee's or the Manager's, as applicable, then
outstanding securities; then, in such event the Majority Banks may,
at their sole option upon written notice to the Borrower (a
"Termination Notice"), declare the obligation of each Bank to make
Advances and the obligation of the Issuing Bank to issue, increase, or
extend Letters of Credit to be terminated, whereupon the same shall
forthwith terminate and the Commitments shall reduce to zero.
Notwithstanding the foregoing, a "change of control" shall not be deemed to
occur as a result of the acquisition of securities of the Borrower, the Parent,
the Participating Lessee or the Manager by any of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ or
their respective Associates (as such term is defined in Rule 12b-2 promulgated
under the Exchange Act) or controlled Affiliates.
-38-
(b) Borrower Capitalization Event. Upon the occurrence of any Borrower
-----------------------------
Capitalization Event, the aggregate Commitments shall reduce by an amount equal
to 100% of the Net Cash Proceeds of such Borrower Capitalization Event, with
each Bank's Commitment being reduced by such Bank's Pro Rata Share of the
aggregate reduction in Commitments.
Section 2.05 Repayment of Advances.
---------------------
Advances. The Borrower shall repay the outstanding principal amount of each
--------
Advance on the Initial Maturity Date; provided that if the Maturity Date is
extended as provided in Section 2.01(b), the total outstanding balance of all
Advances as of the Initial Maturity Date shall be payable thereafter in
quarterly installments on August 1, 1999, November 1, 1999, February 1, 2000 and
May 1, 2000 in an amount equal to the product of (i) one sixtieth (1/60) times
(ii) the sum of (A) the amount of the Advances on the Initial Maturity Date
following the conversion of the loan to a term loan and (B) the amount of the
Letter of Credit Exposure on the Initial Maturity Date. The Borrower shall on
the Maturity Date repay the outstanding principal amount of Advances.
Section 2.06 Interest, Late Payment Fee. The Borrower shall pay interest
--------------------------
on the unpaid principal amount of each Advance made by each Bank from the date
of such Advance until such principal amount shall be paid in full, at the
following rates per annum:
(a) Prime Rate Advances. If such Advance is a Prime Rate Advance, a rate
-------------------
per annum (computed on the actual number of days elapsed, including the first
day and excluding the last, based on a 365 day year) equal at all times to the
lesser of (i) the Adjusted Prime Rate in effect from time to time plus the
----
Applicable Margin and (ii) the Maximum Rate, payable in arrears on the last
Business Day of each calendar month and on the date such Prime Rate Advance
shall be paid in full, provided that during the continuance of an Event of
--------
Default, Prime Rate Advances shall bear interest at a rate per annum equal at
all times to the lesser of (i) the rate required to be paid on such Advance
immediately prior to the date on which such amount becomes due plus three
----
percent (3%) and (ii) the Maximum Rate.
(b) LIBOR Rate Advances. If such Advance is a LIBOR Rate Advance, a rate
per annum (computed on the actual number of days elapsed, including the first
day and excluding the last, based on a 360 day year) equal at all times during
the Interest Period for such Advance to the lesser of (i) the LIBOR Rate for
such Interest Period plus the Applicable Margin and (ii) the Maximum Rate,
----
payable in arrears on the last day of each calendar month and the last day of
such Interest Period, and on the date such LIBOR Rate Advance shall be paid in
full; provided that during the continuance of an Event of Default, LIBOR Rate
--------
Advances shall bear interest at a rate per annum equal at all times to the
lesser of the rate required to be paid on such Advance immediately prior to the
date on which such amount became due plus three percent (3%) and (ii) the
----
Maximum Rate.
-39-
(c) Usury Recapture. In the event the rate of interest chargeable under
---------------
this Agreement or the Notes at any time is greater than the Maximum Rate, the
unpaid principal amount of the Notes shall bear interest at the Maximum Rate
until the total amount of interest paid or accrued on the Notes equals the
amount of interest which would have been paid or accrued on the Notes if the
stated rates of interest set forth in this Agreement had at all times been in
effect. In the event, upon payment in full of the Notes, the total amount of
interest paid or accrued under the terms of this Agreement and the Notes is less
than the total amount of interest which would have been paid or accrued if the
rates of interest set forth in this Agreement had, at all times, been in effect,
then the Borrower shall, to the extent permitted by applicable law, pay the
Administrative Agent for the account of the Banks an amount equal to the
difference between (i) the lesser of (A) the amount of interest which would have
been charged on the Notes if the Maximum Rate had, at all times, been in effect
and (B) the amount of interest which would have accrued on the Notes if the
rates of interest set forth in this Agreement had at all times been in effect
and (ii) the amount of interest actually paid or accrued under this Agreement on
the Notes. In the event the Banks ever receive, collect or apply as interest
any sum in excess of the Maximum Rate, such excess amount shall, to the extent
permitted by law, be applied to the reduction of the principal balance of the
Notes, and if no such principal is then outstanding, such excess or part thereof
remaining shall be paid to the Borrower.
(d) Other Amounts Overdue. If any amount payable under this Agreement other
---------------------
than the Advances is not paid when due and payable, including without
limitation, accrued interest and fees, then such overdue amount shall accrue
interest hereon due and payable on demand at a rate per annum equal to the
Adjusted Prime Rate plus three percent (3%), from the date such amount became
----
due until the date such amount is paid in full.
(e) Late Payment Fee. Subject to the provisions of Section 9.12, if any
----------------
interest payable under this Agreement is not paid when due and payable (after
taking into account any applicable grace period), then the Borrower will pay to
the Banks contemporaneously with the payment of such past due interest a late
payment fee equal to an amount equal to the product of (i) such overdue interest
times (ii) four percent (4%).
-----
Section 2.07 Prepayments.
-----------
(a) Right to Prepay. The Borrower shall have no right to prepay any
---------------
principal amount of any Advance except as provided in this Section 2.07.
(b) Optional Prepayments. The Borrower may elect to prepay any of the
--------------------
Advances, after giving by 11:00 a.m. (Dallas, Texas time) (i) in the case of
LIBOR Rate Advances, at least three Business Days' or (ii) in case of Prime Rate
Advances, at least one Business Day's prior written notice to the Administrative
Agent stating the proposed date and aggregate principal amount of such
-40-
prepayment, and if applicable, the relevant Interest Period for the Advances to
be prepaid. If any such notice is given, the Borrower shall prepay Advances
comprising part of the same Borrowing in whole or ratably in part in an
aggregate principal amount equal to the amount specified in such notice, and
shall also pay accrued interest to the date of such prepayment on the principal
amount prepaid and amounts, if any, required to be paid pursuant to Section 2.08
as a result of such prepayment being made on such date; provided, however, that
-------- -------
each partial prepayment shall be in an aggregate principal amount not less than
$500,000 and in integral multiples of $100,000.
(c) Mandatory Prepayments.
---------------------
(i) Change of Control. On the fifth Business Day following the
-----------------
Borrower's receipt of a Termination Notice pursuant to Section 2.04 (a)
hereof, the Borrower shall be required to prepay all outstanding Advances
in full and to deposit with the Administrative Agent into the Cash
Collateral Account an amount equal to the Letter of Credit Exposure.
(ii) Borrowing Base Deficiency. On each Borrowing Base Determination
-------------------------
Date, the Borrower shall be required to prepay Advances in an aggregate
amount equal to the excess of (A) the aggregate amount of outstanding
Advances and Letter of Credit Exposure on such date over (B) the Borrowing
Base, as determined on such Borrowing Base Determination Date (or, upon
payment in full of all outstanding Advances, to deposit with the
Administrative Agent into the Cash Collateral Account an amount equal to
the amount of the Letter of Credit Exposure which exceeds the Borrowing
Base).
(iii) Asset Sale. Contemporaneously with the occurrence of any Asset
----------
Sale, the Borrower shall prepay Advances in an amount equal to the Release
Amount of each such Asset Sale (except as otherwise provided in the
definition of Conditions to Collateral Release for a sale of a Permitted
Non-Eligible Property).
(iv) Capitalization Event. Upon the occurrence of any Capitalization
--------------------
Event, the Borrower shall prepay Advances in an amount equal to 100% of the
Net Cash Proceeds of such Capitalization Event on the Business Day such Net
Cash Proceeds are received by the Borrower or the Parent, as applicable
(or, in connection with a Borrower Capitalization Event only, upon payment
in full of all outstanding Advances, to deposit with the Administrative
Agent into the Cash Collateral Account an amount equal to the lesser of the
amount of the Letter of Credit Exposure or the remaining Net Cash
Proceeds).
(v) Accrued Interest. Each prepayment pursuant to this Section 2.07(c)
----------------
shall be accompanied by accrued interest on the amount prepaid to the date
of such prepayment and
-41-
amounts, if any, required to be paid pursuant to Section 2.08 as a result
of such prepayment being made on such date.
(vi) Avoidance of Breakage Costs. In the event that the amount of any
---------------------------
mandatory prepayment of Advances under this Section 2.07(c) exceeds the
aggregate principal amount of Advances which consist of Prime Rate Advances
(the amount of such excess being the "Excess Amount"), the Borrower shall
-------------
have the right, in lieu of making such prepayment in full, to prepay such
outstanding Advances which are Prime Rate Advances and to deposit an amount
equal to the Excess Amount with the Administrative Agent in the Cash
Collateral Account maintained by and in the sole dominion and control of
the Administrative Agent for the ratable benefit of the Banks. Any amount
so deposited shall be held by the Administrative Agent as collateral for
the Obligations and applied to the prepayment of Advances which are LIBOR
Rate Advances at the end of the current Interest Period(s) applicable
thereto. On any day on which amounts collected in the Cash Collateral
Account remain on deposit in or to the credit of the Cash Collateral
Account after giving effect to the payment made on such day pursuant to
this Section 2.07(c), and the Borrower shall have delivered to the
Administrative Agent a written request or a telephonic request (which shall
be promptly confirmed in writing) prior to 11:00 am (Dallas, Texas time)
that such remaining collected amounts be invested in cash equivalents
specified in such request, the Administrative Agent shall invest such
funds, to the extent the Administrative Agent is reasonably able to do so,
in such cash equivalents as are acceptable to, and with no risk to, the
Administrative Agent on an overnight basis or with maturities such that
amounts will be available to pay the Obligations secured thereby as they
become due, whether at maturity, by acceleration or otherwise; provided,
--------
however, that any loss resulting from such investments shall be charged to
-------
and be immediately payable by the Borrower on demand by the Administrative
Agent.
(d) Ratable Payments. Each payment of any Advance pursuant to this Section
----------------
2.07 or any other provision of this Agreement shall be made in a manner such
that all Advances comprising part of the same Borrowing are paid in whole or
ratably in part.
(e) Effect of Notice. All notices given pursuant to this Section 2.07 shall
----------------
be irrevocable and binding upon the Borrower.
(f) Payments with respect to Hotel Property Limitations. Notwithstanding
---------------------------------------------------
anything in this Agreement or any other Credit Document to the contrary, each
payment of any Advance pursuant to this Section 2.07 or any other provision of
this Agreement shall be made in a manner such that all Advances secured by a
Hotel Property for which any of the Security Documents for such Hotel Property
state that the amount of the Obligations secured by such Hotel Property is
limited in some way shall be deemed the last Advances repaid and, to the extent
that the Advances are repaid to an
-42-
amount less than the amount of any such limitation, shall be deemed the first
Advances made to the Borrower if and when the Borrower requests any further
Advances.
Section 2.08 Breakage Costs. If (a) any payment of principal of any LIBOR
--------------
Rate Advance is made other than on the last day of the Interest Period for such
Advance as a result of any payment pursuant to Section 2.07 or the acceleration
of the maturity of the Notes pursuant to Article VIII or otherwise; (b) any
Conversion of a LIBOR Rate Advance is made other than on the last day of the
Interest Period for such Advance pursuant to Section 2.12 or otherwise; or (c)
the Borrower fails to make a principal or interest payment with respect to any
LIBOR Rate Advance on the date such payment is due and payable, the Borrower
shall, within 10 days of any written demand sent by any Bank to the Borrower
through the Administrative Agent, pay to the Administrative Agent for the
account of such Bank any amounts (without duplication of any other amounts
payable in respect of breakage costs) required to compensate such Bank for any
additional losses, out-of-pocket costs or expenses which it may reasonably incur
as a result of such payment or nonpayment, including, without limitation, any
loss (including loss of anticipated profits), cost or expense incurred by reason
of the liquidation or reemployment of deposits or other funds acquired by any
Bank to fund or maintain such Advance.
Section 2.09 Increased Costs.
---------------
(a) LIBOR Rate Advances. If, due to either (i) the introduction of or any
-------------------
change (other than any change by way of imposition or increase of reserve
requirements included in the calculation of the LIBOR Rate) in or in the
interpretation of any law or regulation or (ii) the compliance with any
guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law), there shall be any increase in the
cost to any Bank of agreeing to make or making, funding or maintaining LIBOR
Rate Advances, then the Borrower shall from time to time, upon demand by such
Bank (with a copy of such demand to the Administrative Agent), immediately pay
to the Administrative Agent for the account of such Bank additional amounts
(without duplication of any other amounts payable in respect of increased costs)
sufficient to compensate such Bank for such increased cost; provided, however,
-------- -------
that, before making any such demand, each Bank agrees to use commercially
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Applicable Lending Office if the making
of such a designation would avoid the need for, or reduce the amount of, such
increased cost and would not, in the reasonable judgment of such Bank, be
otherwise disadvantageous to such Bank. A certificate as to the amount of such
increased cost and detailing the calculation of such cost submitted to the
Borrower and the Administrative Agent by such Bank at the time such Bank demands
payment under this Section shall be conclusive and binding for all purposes,
absent manifest error.
-43-
(b) Capital Adequacy. If any Bank or the Issuing Bank determines in good
----------------
faith that compliance with any law or regulation or any guideline or request
from any central bank or other Governmental Authority (whether or not having the
force of law) implemented or effective after the date of this Agreement affects
or would affect the amount of capital required or expected to be maintained by
such Bank or the Issuing Bank and that the amount of such capital is increased
by or based upon the existence of such Bank's commitment to lend or the Issuing
Bank's commitment to issue Letters of Credit or any Bank's commitment to risk
participate in Letters of Credit and other commitments of this type, then, upon
30 days prior written notice by such Bank or the Issuing Bank (with a copy of
any such demand to the Administrative Agent), the Borrower shall immediately pay
to the Administrative Agent for the account of such Bank or to the Issuing Bank,
as the case may be, from time to time as specified by such Bank or the Issuing
Bank, additional amounts (without duplication of any other amounts payable in
respect of increased costs) sufficient to compensate such Bank or the Issuing
Bank, in light of such circumstances, (i) with respect to such Bank, to the
extent that the Issuing Bank reasonably determines such increase in capital to
be allocable to the existence of such Bank's commitment to lend under this
Agreement or its commitment to risk participate in Letters of Credit and (ii)
with respect to the Issuing Bank, to the extent that such Issuing Bank
reasonably determines such increase in capital to be allocable to the issuance
or maintenance of the Letters of Credit. A certificate as to such amounts and
detailing the calculation of such amounts submitted to the Borrower and the
Administrative Agent by such Bank or the Issuing Bank shall be conclusive and
binding for all purposes, absent manifest error.
(c) Letters of Credit. If any change in any law or regulation or in the
-----------------
interpretation thereof by any court or administrative or Governmental Authority
charged with the administration thereof shall either (i) impose, modify, or deem
applicable any reserve, special deposit, or similar requirement against letters
of credit issued by, or assets held by, or deposits in or for the account of,
Issuing Bank or any Bank or (ii) impose on Issuing Bank or any Bank any other
condition regarding the provisions of this Agreement relating to the Letters of
Credit or any Letter of Credit Obligations, and the result of any event referred
to in the preceding clause (i) or (ii) shall be to increase the cost to Issuing
Bank of issuing or maintaining any Letter of Credit, or increase the cost to
such Bank of its risk participation in any Letter of Credit (which increase in
cost shall be determined by Issuing Bank's or such Bank's reasonable allocation
of the aggregate of such cost increases resulting from such event), then, upon
demand by Issuing Bank or such Bank (with a copy sent to the Administrative
Agent), as the case may be, the Borrower shall pay to the Administrative Agent
for the account of Issuing Bank or Bank, as the case may be, from time to time
as specified by Issuing Bank or such Bank, additional amounts which shall be
sufficient to compensate such Issuing Bank or such Bank for such increased cost.
Issuing Bank and each Bank agrees to use commercially reasonable efforts
(consistent with internal policy and legal and regulatory restrictions) to
designate a different Applicable Lending Office for the booking of its Letters
of Credit or risk participations if the making of such designation would avoid
the effect of this paragraph and would not, in the
-44-
reasonable judgment of Issuing Bank or such Bank, be otherwise disadvantageous
to Issuing Bank or such Bank, as the case may be. A certificate as to such
increased cost incurred by Issuing Bank or such Bank, as the case may be, as a
result of any event mentioned in clause (i) or (ii) above, and detailing the
calculation of such increased costs submitted by Issuing Bank or such Bank to
the Borrower and the Administrative Agent, shall be conclusive and binding for
all purposes, absent manifest error.
Section 2.10 Payments and Computations.
-------------------------
(a) Payment Procedures. Except if otherwise set forth herein, the Borrower
------------------
shall make each payment under this Agreement and under the Notes not later than
11:00 a.m. (Dallas, Texas time) on the day when due in Dollars to the
Administrative Agent at the location referred to in the Notes (or such other
location as the Administrative Agent shall designate in writing to the Borrower)
in same day funds. The Administrative Agent will promptly thereafter cause to
be distributed like funds relating to the payment of principal, interest or fees
ratably (other than amounts payable solely to the Administrative Agent, the
Issuing Banks, or a specific Bank pursuant to Section 2.03(c), 2.03(d), 2.06(c),
2.08, 2.09, 2.11, 2.12, or 2.13(c) but after taking into account payments
effected pursuant to Section 9.04) to the Banks in accordance with each Bank's
Pro Rata Share for the account of their respective Applicable Lending Offices,
and like funds relating to the payment of any other amount payable to any Bank
or Issuing Bank for the account of its Applicable Lending Office, in each case
to be applied in accordance with the terms of this Agreement. The Borrower
hereby authorizes the Administrative Agent to instruct the Cash Manager
following and during the continuance of an Event of Default to withdraw from or
offset against the Borrower's and the Borrower's Subsidiaries accounts with the
Cash Manager (including the Borrower's Bank Accounts) in order to cause timely
payment to be made to the Administrative Agent of all principal, interest, fees
and expenses due hereunder or under the Notes or the other Credit Documents
(subject to sufficient funds being available in such accounts for that purpose).
(b) Computations. All computations of interest based on the Adjusted Prime
------------
Rate shall be made by the Administrative Agent on the basis of a year of 365
days and all computations of fees and interest based on the LIBOR Rate and the
Federal Funds Rate shall be made by the Administrative Agent on the basis of a
year of 360 days, in each case for the actual number of days (including the
first day, but excluding the last day) occurring in the period for which such
interest or fees are payable. Each determination by the Administrative Agent of
an interest rate shall be conclusive and binding for all purposes, absent
manifest error.
(c) Non-Business Day Payments. Whenever any payment shall be stated to be
-------------------------
due on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or
-45-
fees, as the case may be; provided, however, that if such extension would cause
--------
payment of interest on or principal of LIBOR Rate Advances to be made in the
next following calendar month, such payment shall be made on the next preceding
Business Day.
(d) Administrative Agent Reliance. Unless the Administrative Agent shall
-----------------------------
have received written notice from the Borrower prior to the date on which any
payment is due to the Banks that the Borrower will not make such payment in
full, the Administrative Agent may assume that the Borrower has made such
payment in full to the Administrative Agent on such date and the Administrative
Agent may, in reliance upon such assumption, cause to be distributed to each
Bank on such date an amount equal to the amount then due such Bank. If and to
the extent the Borrower shall not have so made such payment in full to the
Administrative Agent, each Bank shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Bank, together with
interest, for each day from the date such amount is distributed to such Bank
until the date such Bank repays such amount to the Administrative Agent, at the
Federal Funds Rate for each such day.
(e) Application of Payments. Unless otherwise specified in Section 2.07
-----------------------
hereof, whenever any payment received by the Administrative Agent under this
Agreement is insufficient to pay in full all amounts then due and payable under
this Agreement and the Notes, such payment shall be distributed and applied by
the Administrative Agent and the Banks in the following order: first, to the
-----
payment of fees and expenses due and payable to the Administrative Agent under
and in connection with this Agreement or any other Credit Document; second, to
------
the payment of all expenses due and payable under Section 2.11(c), ratably among
the Banks in accordance with the aggregate amount of such payments owed to each
such Bank; third, to the payment of fees due and payable to the Issuing Bank
-----
pursuant to Section 2.03(c); fourth, to the payment of all other fees due and
------
payable under Section 2.03 ratably among the Banks in accordance with their
applicable Commitments; and fifth, to the payment of the interest accrued on and
-----
the principal amount of all of the Notes and the interest accrued on and all
Reimbursement Obligations, regardless of whether any such amount is then due and
payable, ratably among the Banks in accordance with the aggregate accrued
interest plus the aggregate principal amount owed to such Bank.
(f) Register. The Administrative Agent shall record in the Register the
--------
Commitment and the Advances from time to time of each Bank and each repayment or
prepayment in respect to the principal amount of such Advances of each Bank.
Any such recordation shall be conclusive and binding on the Borrower and each
Bank, absent manifest error; provided however, that failure to make any such
-------- -------
recordation, or any error in such recordation, shall not affect the Borrower's
obligations hereunder in respect of such Advances.
-46-
Section 2.11 Taxes.
-----
(a) No Deduction for Certain Taxes. Any and all payments by the Borrower
------------------------------
shall be made, in accordance with Section 2.10, free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding, in
the case of each Bank, Issuing Bank, and the Administrative Agent, taxes imposed
on its income, and franchise taxes imposed on it, by the jurisdiction under the
laws of which such Bank, Issuing Bank, or the Administrative Agent (as the case
may be) is organized or any political subdivision of the jurisdiction (all such
nonexcluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes") and, in the case of each
Bank and Issuing Bank, Taxes by the jurisdiction of such Bank's Applicable
Lending Office or any political subdivision of such jurisdiction. If the
Borrower shall be required by law to deduct any Taxes from or in respect of any
sum payable to any Bank, Issuing Bank, or the Administrative Agent, (i) the sum
payable shall be increased as may be necessary so that, after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.11), such Bank, Issuing Bank, or the Administrative Agent
(as the case may be) receives an amount equal to the sum it would have received
had no such deductions been made; provided, however, that if the Borrower's
--------
obligation to deduct or withhold Taxes is caused solely by such Bank's, Issuing
Bank's, or the Administrative Agent's failure to provide the forms described in
paragraph (e) of this Section 2.11 and such Bank, Issuing Bank, or the
Administrative Agent could have provided such forms, no such increase shall be
required; (ii) the Borrower shall make such deductions; and (iii) the Borrower
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable Legal Requirements.
(b) Other Taxes. In addition, the Borrower agrees to pay any present or
-----------
future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies which arise from any payment made or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement, the
Notes, or the other Credit Documents (hereinafter referred to as "Other Taxes").
(c) Indemnification. The Borrower indemnifies each Bank, Issuing Bank, and
---------------
the Administrative Agent for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed by any Governmental
Authority on amounts payable under this Section 2.11) paid by such Bank, Issuing
Bank, or the Administrative Agent (as the case may be) and any liability
(including interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
Each payment required to be made by the Borrower in respect of this
indemnification shall be made to the Administrative Agent for the benefit of any
party claiming such indemnification within 30 days from the date the Borrower
receives written demand detailing the calculation of such amounts therefor from
the Administrative Agent on behalf of itself as Administrative Agent, Issuing
Bank, or any such Bank. If any Bank, the
-47-
Administrative Agent, or Issuing Bank receives a refund in respect of any Taxes
or Other Taxes paid by the Borrower under this paragraph (c), such Bank, the
Administrative Agent, or Issuing Bank, as the case may be, shall promptly pay to
the Borrower the Borrower's share of such refund.
(d) Evidence of Tax Payments. The Borrower will pay prior to delinquency all
------------------------
Taxes and other Taxes payable in respect of any payment. Within 30 days after
the date of any payment of Taxes, the Borrower will furnish to the
Administrative Agent, at its address referred to in Section 9.02, the original
or a certified copy of a receipt evidencing payment of such Taxes or Other
Taxes.
(e) Foreign Bank Withholding Exemption. Each Bank and each Issuing Bank that
----------------------------------
is not incorporated under the laws of the United States of America or a state
thereof agrees that it will deliver to the Borrower and the Administrative Agent
on the date of this Agreement or upon the effectiveness of any Assignment and
Acceptance (i) two duly completed copies of United States Internal Revenue
Service Form 1001 or 4224 or successor applicable form, as the case may be,
certifying in each case that such Bank is entitled to receive payments under
this Agreement and the Notes payable to it, without deduction or withholding of
any United States federal income taxes, (ii) if applicable, an Internal Revenue
Service Form W-8 or W-9 or successor applicable form, as the case may be, to
establish an exemption from United States backup withholding tax, and (iii) any
other governmental forms which are necessary or required under an applicable tax
treaty or otherwise by law to reduce or eliminate any withholding tax, which
have been reasonably requested by the Borrower. Each Bank which delivers to the
Borrower and the Administrative Agent a Form 1001 or 4224 and Form W-8 or W-9
pursuant to the next preceding sentence further undertakes to deliver to the
Borrower and the Administrative Agent two further copies of Form 1001 or 4224
and Form W-8 or W-9, or successor applicable forms, or other manner of
certification, as the case may be, on or before the date that any such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form previously delivered by it to the Borrower and
the Administrative Agent, and such extensions or renewals thereof as may
reasonably be requested by the Borrower and the Administrative Agent certifying
in the case of a Form 1001 or 4224 that such Bank is entitled to receive
payments under this Agreement without deduction or withholding of any United
States federal income taxes. If an event (including without limitation any
change in treaty, law or regulation) has occurred prior to the date on which any
delivery required by the preceding sentence would otherwise be required which
renders all such forms inapplicable or which would prevent any Bank from duly
completing and delivering any such letter or form with respect to it and such
Bank advises the Borrower and the Administrative Agent that it is not capable of
receiving payments without any deduction or withholding of United States federal
income tax, and in the case of a Form W-8 or W-9, establishing an exemption from
United States backup withholding tax, such Bank shall not be required to deliver
such forms. The Borrower shall withhold
-48-
tax at the rate and in the manner required by the laws of the United States with
respect to payments made to a Bank failing to timely provide the requisite
Internal Revenue Service forms.
Section 2.12 Illegality. If any Bank shall notify the Administrative Agent
----------
and the Borrower that the introduction of or any change in or in the
interpretation of any Legal Requirement makes it unlawful, or that any central
bank or other Governmental Authority asserts that it is unlawful for such Bank
or its LIBOR Lending Office to perform its obligations under this Agreement to
maintain any LIBOR Rate Advances of such Bank then outstanding hereunder, then,
notwithstanding anything herein to the contrary, the Borrower shall, if demanded
by such Bank by notice to the Borrower and the Administrative Agent no later
than 11:00 a.m. (Dallas, Texas time), (a) if not prohibited by Legal Requirement
to maintain such LIBOR Rate Advances for the duration of the Interest Period, on
the last day of the Interest Period for each outstanding LIBOR Rate Advance of
such Bank or (b) if prohibited by Legal Requirement to maintain such LIBOR Rate
Advances for the duration of the Interest Period, on the second Business Day
following its receipt of such notice from such Bank, Convert all LIBOR Rate
Advances of such Bank then outstanding to Prime Rate Advances, and pay accrued
interest on the principal amount Converted to the date of such Conversion and
amounts, if any, required to be paid pursuant to Section 2.08 as a result of
such Conversion being made on such date. Each Bank agrees to use commercially
reasonable efforts (consistent with its internal policies and legal and
regulatory restrictions) to designate a different Applicable Lending Office if
the making of such designation would avoid the effect of this paragraph and
would not, in the reasonable judgment of such Bank, be otherwise disadvantageous
to such Bank.
Section 2.13 Letters of Credit.
-----------------
(a) Issuance. From time to time from the date of this Agreement until three
--------
months before the Maturity Date, at the request of the Borrower, each Issuing
Bank shall, on any Business Day and on the terms and conditions hereinafter set
forth, issue, increase, decrease, amend, or extend the expiration date of
Letters of Credit for the account of the Borrower (for its own benefit or for
the benefit of any of its Subsidiaries). No Letter of Credit will be issued,
increased, or extended (i) if such issuance, increase, or extension would cause
the Letter of Credit Exposure to exceed the lesser of (x) $10,000,000 or (y) an
amount equal to (A) the lesser of the Borrowing Base or the aggregate
Commitments less (B) the aggregate outstanding Advances and Letter of Credit
----
Exposure at such time; (ii) unless such Letter of Credit has an Expiration Date
not later than the earlier of (A) one year after the date of issuance thereof
and (B) the Maturity Date; (iii) unless such Letter of Credit is in form and
substance acceptable to the respective Issuing Bank; (iv) unless such Letter of
Credit is a standby letter of credit not supporting the repayment of
indebtedness for borrowed money of any Person; (v) unless the Borrower has
delivered to the respective Issuing Bank the completed and executed Letter of
Credit Documents (other than the Letter of Credit) on such Issuing Bank's
standard form, which shall contain terms no more restrictive than the terms of
this Agreement; and
-49-
(vi) unless such Letter of Credit is governed by the Uniform Customs and
Practice for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500 ("UCP") or any successor to the UCP. After the
Initial Maturity Date, the Borrower will no longer have the right to any
increase in the Letter of Credit Exposure. If the terms of any of the Letter of
Credit Documents referred to in the foregoing clause (v) conflicts with the
terms of this Agreement, the terms of this Agreement shall control.
(b) Participations. On the date of the issuance or increase of any Letter of
--------------
Credit on or after the Effective Date, each Issuing Bank shall be deemed to have
sold to each other Bank and each other Bank shall have been deemed to have
purchased from such Issuing Bank a participation in the Letter of Credit
Exposure related to the Letters of Credit issued by such Issuing Bank equal to
such Bank's Pro Rata Share at such date and such sale and purchase shall
otherwise be in accordance with the terms of this Agreement. Each Issuing Bank
shall promptly notify each such participant Bank by telex, telephone, or
telecopy of each Letter of Credit of such Issuing Bank issued, increased or
decreased, and the actual dollar amount of such Bank's participation in such
Letter of Credit. Each Bank's obligation to purchase participating interests
pursuant to this Section and to reimburse the respective Issuing Bank for such
Bank's Pro Rata Share of any payment under a Letter of Credit by such Issuing
Bank not reimbursed in full by the Borrower shall be absolute and unconditional
and shall not be affected by any circumstance, including, without limitation,
(i) any of the circumstances described in paragraph (d) below, (ii) the
occurrence and continuance of a Default, (iii) an adverse change in the
financial condition of the Borrower or any Guarantor, or (iv) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing, except for any such circumstance, happening or event constituting
or arising from gross negligence or willful misconduct on the part of such
Issuing Bank.
(c) Reimbursement. The Borrower shall have the right (but not the
-------------
obligation) to pay promptly on demand to each Issuing Bank in respect of each
Letter of Credit issued by such Issuing Bank an amount equal to any amount paid
by such Issuing Bank under or in respect of such Letter of Credit. In the event
any Issuing Bank makes a payment pursuant to a request for draw presented under
a Letter of Credit and such payment is not promptly reimbursed by the Borrower
upon demand, such Issuing Bank shall give notice of such payment to the
Administrative Agent and the Banks, and each Bank shall promptly reimburse such
Issuing Bank for such Bank's Pro Rata Share of such payment, and such
reimbursement shall be deemed for all purposes of this Agreement to constitute a
Prime Rate Advance to the Borrower from such Bank. If such reimbursement is not
made by any Bank to any Issuing Bank on the same day on which such Issuing Bank
shall have made payment on any such draw, such Bank shall pay interest thereon
to such Issuing Bank for each such day from the date such payment should have
been made until the date repaid at a rate per annum equal to the Federal Funds
Rate for each such day. The Borrower hereby unconditionally and irrevocably
authorizes, empowers, and directs the Administrative Agent and the Banks to
record
-50-
and otherwise treat each payment under a Letter of Credit not immediately
reimbursed by the Borrower as a Borrowing comprised of Prime Rate Advances to
the Borrower.
(d) Obligations Unconditional. The obligations of the Borrower under this
-------------------------
Agreement in respect of each Letter of Credit shall be unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, notwithstanding the following circumstances:
(i) any lack of validity or enforceability of any Letter of Credit
Documents;
(ii) any amendment or waiver of or any consent to departure from any
Letter of Credit Documents;
(iii) the existence of any claim, set-off, defense or other right which
the Borrower or any Bank or any other Person may have at any time against
any beneficiary or transferee of such Letter of Credit (or any Persons for
whom any such beneficiary or any such transferee may be acting), the
respective Issuing Bank or any other Person or entity, whether in
connection with this Agreement, the transactions contemplated in this
Agreement or in any Letter of Credit Documents or any unrelated
transaction;
(iv) any statement or any other document presented under such Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any
respect or any statement therein being untrue or inaccurate in any respect
to the extent the respective Issuing Bank would not be liable therefor
pursuant to the following paragraph (e);
(v) payment by the respective Issuing Bank under such Letter of Credit
against presentation of a draft or certificate which does not comply with
the terms of such Letter of Credit; or
(vi) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing.
(e) Liability of Issuing Banks. The Borrower assumes all risks of the acts
--------------------------
or omissions of any beneficiary or transferee of any Letter of Credit with
respect to its use of such Letter of Credit. No Issuing Bank nor any of its
officers or directors shall be liable or responsible for:
(i) the use which may be made of any Letter of Credit or any acts or
omissions of any beneficiary or transferee in connection therewith;
-51-
(ii) the validity, sufficiency or genuineness of documents, or of any
endorsement thereon, even if such documents should prove to be in any or
all respects invalid, insufficient, fraudulent or forged;
(iii) payment by such Issuing Bank against presentation of documents
which do not comply with the terms of a Letter of Credit, including failure
of any documents to bear any reference or adequate reference to the
relevant Letter of Credit; or
(iv) any other circumstances whatsoever in making or failing to make
payment under any Letter of Credit (including such Issuing Bank's own
negligence),
except that the Borrower shall have a claim against such Issuing Bank, and such
------
Issuing Bank shall be liable to, and shall promptly pay to, the Borrower, to the
extent of any direct, as opposed to consequential, damages suffered by the
Borrower which the Borrower proves were caused by (A) such Issuing Bank's
willful misconduct or gross negligence in determining whether documents
presented under a Letter of Credit comply with the terms of such Letter of
Credit or (B) such Issuing Bank's gross negligence in failing to make lawful
payment under any Letter of Credit after the presentation to it of a draft and
certificate strictly complying with the terms and conditions of such Letter of
Credit. In furtherance and not in limitation of the foregoing, any Issuing Bank
may accept documents that appear on their face to be in order, without
responsibility for further investigation.
Section 2.14 Determination of Borrowing Base. The Borrowing Base shall be
-------------------------------
determined by the Administrative Agent, as follows:
(a) Quarterly. On the 45th day following each calendar quarter the
---------
Administrative Agent shall determine the Borrowing Base upon receipt of a
Borrowing Base Certificate setting forth the components of the Borrowing Base
dated as of the last day of the immediately preceding calendar quarter.
(b) Property Adjustments. Following each addition or deletion of a Hotel
--------------------
Property as an Eligible Property (an "Adjustment Event"), and with respect to
----------------
the addition of an Eligible Property the Administrative Agent's receipt of a
Property Adjustment Report with respect thereto, the Administrative Agent shall
adjust the Borrowing Base accordingly.
(c) Notice of Borrowing Base Change. Promptly following any date the
-------------------------------
Borrowing Base is redetermined in accordance with the preceding paragraphs, the
Administrative Agent shall give notice to the Banks and the Borrower of the new
Borrowing Base.
-52-
Section 2.15 Bank Replacement.
----------------
(a) Right to Replace. The Borrower shall have the right to replace each Bank
----------------
affected by a condition under Section 2.02(c)(v), 2.09, or 2.12 for more than 90
days (each such affected Bank, an "Affected Bank") in accordance with the
procedures in this Section 2.15 and provided that no reduction of the total
Commitments occurs as a result thereof.
(b) First Right of Refusal; Replacement.
-----------------------------------
(i) Upon the occurrence of any condition permitting the replacement of a
Bank, each Bank which is not an Affected Bank shall have the right, but not
the obligation, to elect to increase its respective Commitment by an amount
not to exceed the amount of the Commitments of the Affected Banks, which
election shall be made by written notice from each such Bank to the
Administrative Agent and the Borrower given within 30 days after the date
such condition occurs specifying the amount of such proposed increase in
such Bank's Commitment.
(ii) If the aggregate amount of the proposed increases in Commitments
of all such Banks making such an election is in excess of the Commitments
of the Affected Banks, (A) the Commitments of the Affected Banks shall be
allocated pro rata among such Banks based on the respective amounts of the
proposed increases to Commitments elected by each of such Banks, and (B)
the respective Commitments of such Banks shall be increased by the
respective amounts as so allocated so that after giving effect to such
termination and increases the aggregate amount of the Commitments of the
Banks will be the same as prior to such termination.
(iii) If the aggregate amount of the proposed increases to Commitments
of all Banks making such an election equals the Commitments of the Affected
Banks, the respective Commitments of such Banks shall be increased by the
respective amounts of their proposed increases, so that after giving effect
to such termination and increase the aggregate amount of the Commitments of
all of the Banks will be the same as prior to such termination.
(iv) If the aggregate amount of the proposed increases to Commitments of
all Banks making such an election is less than the Commitments of the
Affected Banks, (A) the respective Commitments of such Banks shall be
increased by the respective amounts of their proposed increases, and (B)
the Borrower shall have the right to add additional Banks which are
Eligible Assignees to this Agreement to replace such Affected Banks, which
additional Banks would have aggregate Commitments no greater than those of
the Affected Banks minus the amounts thereof assumed by the other Banks
-----
pursuant to such increases.
-53-
(c) Procedure. Any assumptions of Commitments pursuant to this Section 2.15
---------
shall be (i) made by the purchasing Bank or Eligible Assignee and the selling
Bank entering into an Assignment and Assumption and by following the procedures
in Section 9.06 for adding a Bank. In connection with the increase of the
Commitments of any Bank pursuant to the foregoing paragraph (b), each Bank with
an increased Commitment shall purchase from the Affected Banks at par such
Bank's ratable share of the outstanding Advances of the Affected Banks and
assume such Bank's ratable share of the Affected Banks' Letter of Credit
Exposure.
Section 2.16 Sharing of Payments, Etc. If any Bank shall obtain any
------------------------
payment (whether voluntary, involuntary, through the exercise of any right of
set-off or otherwise) on account of its Advances or its share of Letter of
Credit Obligations in excess of its Pro Rata Share of payments on account of the
Advances or Letter of Credit Obligations obtained by all the Banks, such Bank
shall notify the Administrative Agent and forthwith purchase from the other
Banks such participations in the Advances made by them or Letter of Credit
Obligations held by them as shall be necessary to cause such purchasing Bank to
share the excess payment ratably in accordance with the requirements of this
Agreement with each of them; provided, however, that if all or any portion of
--------
such excess payment is thereafter recovered from such purchasing Bank, such
purchase from each Bank shall be rescinded and such Bank shall repay to the
purchasing Bank the purchase price to the extent of such Bank's ratable share
(according to the proportion of (a) the amount of the participation sold by such
Bank to the purchasing Bank as a result of such excess payment to (b) the total
amount of such excess payment) of such recovery, together with an amount equal
to such Bank's ratable share (according to the proportion of (a) the amount of
such Bank's required repayment to the purchasing Bank to (b) the total amount of
all such required repayments to the purchasing Bank) of any interest or other
amount paid or payable by the purchasing Bank in respect of the total amount so
recovered. The Borrower agrees that any Bank so purchasing a participation from
another Bank pursuant to this Section 2.16 may, to the fullest extent permitted
by Legal Requirement, unless and until rescinded as provided above, exercise all
its rights of payment (including the right of set-off) with respect to such
participation as fully as if such Bank were the direct creditor of the Borrower
in the amount of such participation.
Section 2.17 Collateral.
----------
(a) Creation and Perfection of Liens. Prior to the termination of the
--------------------------------
Commitments and the repayment in full of the Obligations, a valid, perfected
first priority lien or security interest, as applicable, in the Property of the
Borrower and its Subsidiaries (other than the Permitted Other Subsidiaries) and
in the Participating Lessee Pledged Property (through the Collateral Assignment
and Security Agreement) shall exist in favor of the Administrative Agent for the
benefit of the Banks to secure the Obligations in accordance with the terms of
the Security Documents.
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(b) Further Assurances. The Borrower agrees to promptly, on demand, execute
------------------
and deliver, and cause the Guarantors and the Participating Lessee to execute
and deliver, at the Borrower's expense, such security agreements, pledge
agreements, assignments, mortgages, Financing Statements, stock powers, and
other collateral documentation, and take such other actions deemed by the
Administrative Agent and its counsel to be necessary in order to effect the
foregoing.
(c) Appraisals. The Borrower agrees to obtain, at its own expense and as
----------
promptly as practicable, such other appraisals as any Governmental Authority may
require the Administrative Agent to obtain from time to time to satisfy any
applicable Legal Requirement.
ARTICLE III
CONDITIONS OF LENDING
Section 3.01 Conditions Precedent to Effectiveness of this Agreement. This
-------------------------------------------------------
Agreement shall become effective on the date hereof if on or prior to the close
of business on such date the following conditions precedent have been satisfied:
(a) Documentation. The Administrative Agent shall have received counterparts
-------------
of this Agreement executed by the Borrower and the Banks, and the following duly
executed by all the parties thereto, in form and substance satisfactory to the
Agents, and in sufficient copies for each Bank (except with respect to the
Property Security Documents, the Participating Lessee Documents (except for the
Credit Card Agreements and the Depository Account Agreements with financial
institutions other than the Cash Manager), the Financing Statements (Borrower),
or the Financing Statements (Participating Lessee)):
(i) the Notes, all Guaranties, the Environmental Indemnity, the Security
Agreement, the Mortgages, the other Credit Documents and the Participating
Lessee Documents which have been prepared for execution on the Effective
Date and any related Financing Statements;
(ii) a certificate from the Chief Executive Officer, President or Chief
Financial Officer of the General Partner on behalf of the Borrower dated as
of the Effective Date stating that as of the Effective Date (A) all
representations and warranties of the Borrower set forth in this Agreement
and the Credit Documents are true and correct in all material respects; (B)
no Default has occurred and is continuing; (C) the conditions in this
Section 3.01 have been met or waived in writing; and (D) there are no
claims, defenses, counterclaims or offsets against the Banks under the
Credit Documents;
-55-
(iii) a certificate of the Secretary or an Assistant Secretary of the
General Partner on behalf of the Borrower and each Guarantor dated as of
the date of this Agreement certifying as of the date of this Agreement (A)
the names and true signatures of officers or authorized representatives of
the general partner of the Borrower and such Guarantor authorized to sign
the Credit Documents to which such Person is a party as general partner of
such Person, (B) resolutions of the Board of Directors or the members of
the general partner of such Person with respect to the transactions herein
contemplated, (C) either (x) the copies of the organizational documents of
the general partner of such Person delivered to the Banks are still true
and correct and have not been amended or modified since such date or (y)
copies of any modification or amendment to the organizational documents of
the general partner of such Person made since such date, (D) a true and
correct copy of the partnership agreement for such Person, and (E) a true
and correct copy of all partnership authorizations necessary or desirable
in connection with the transactions herein contemplated;
(iv) a certificate of the Secretary or an Assistant Secretary of the
Parent dated as of the date of this Agreement certifying as of the date of
this Agreement (A) resolutions of the Board of Directors of such Person
with respect to the transactions herein contemplated, (B) the copies of the
charter and bylaws of the Parent and any modification or amendment to the
articles or certificate of incorporation or bylaws of the Parent made since
such date, (C) the issuance of the Parent Common Stock pursuant to the
Public Offering Documents;
(v) a certificate of the Secretary or an Assistant Secretary of the
general partner of the Participating Lessee on behalf of the Participating
Lessee dated as of the date of this Agreement certifying as of the date of
this Agreement (A) the partnership authorization of such Person with
respect to the transactions contemplated by the Participating Leases and
the Participating Lessee Documents, (B) the copies of the Partnership
Agreement and any modification or amendment to the Partnership Agreement of
the Participating Lessee made since such date;
(vi) (A) one or more favorable written opinions of Battle ▇▇▇▇▇▇ L.L.P.,
special counsel for the Borrower, the Parent, and the Participating Lessee
and the Manager and their Subsidiaries, substantially in the form of the
attached Exhibit DD, in each case dated as of the Closing Date and with
such changes as the Agents may approve, (B) one or more favorable written
opinions of Kane, Russell, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, special Texas counsel for the
Borrower, the Parent, and the Participating Lessee and the Manager and
their Subsidiaries, substantially in the form of the attached Exhibit EE,
in each case dated as of the Closing Date and with such changes as the
Agents may approve, (C) a reliance letter from Battle ▇▇▇▇▇▇ L.L.P., as
counsel to the Parent, and each other counsel (other than underwriters'
counsel) delivering an opinion in connection with the Public Offering, in
each case addressed to the Agents and the Banks and
-56-
satisfactory in form and substance to the Agents stating that the Agents
and the Banks may rely on such opinions as if they were original addressees
thereof, and in each case attaching an executed original thereof, (D) one
or more favorable written opinions of the local counsel for the Borrower,
the Parent, the Participating Lessee and the Manager and their Subsidiaries
for each state in which a Hotel Property is located, substantially in the
form of the attached Exhibit FF, in each case dated as of the Closing Date
and with such changes as the Agents may approve, (E) one or more favorable
written opinions of Ballard, Spahr, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, special Maryland
counsel for the Parent, substantially in the form of the attached Exhibit
GG, in each case dated as of the Closing Date and with such changes as the
Agents may approve, (F) one or more favorable written opinions of
McDonald, Hopkins, ▇▇▇▇▇ & ▇▇▇▇▇▇ Co., special Ohio counsel for 3100
Glendale Joint Venture, substantially in the form of the attached Exhibit
HH, in each case dated as of the Closing Date and with such changes as the
Agents may approve, (G) one or more favorable written opinions of ▇▇▇▇▇ &
Lardner, special Wisconsin counsel for Madison Motel Associates,
substantially in the form of the attached Exhibit II, in each case dated as
of the Closing Date and with such changes as the Agents may approve, and
(H) one or more favorable written opinions of McDonald, Carano, Wilson,
McCune, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ &Hicks LLP, special Nevada counsel for the
General Partner, substantially in the form of the attached Exhibit JJ, in
each case dated as of the Closing Date and with such changes as the Agents
may approve;
(vii) a Borrowing Base Certificate dated as of July 31, 1996, each duly
completed and executed by the Chief Financial Officer or Treasurer of the
General Partner on behalf of the Borrower; and
(viii) such other documents, governmental certificates, agreements,
lien searches as either Agent may reasonably request.
(b) Representations and Warranties. The representations and warranties
------------------------------
contained in Article IV hereof, the Guaranties, the Environmental Indemnities
and in each Security Document and Participating Lessee Document shall be true
and correct in all material respects.
(c) Certain Payments. The Borrower shall have paid the fees required to be
----------------
paid as of the Effective Date pursuant to the Agents' Fee Letter.
Section 3.02 Conditions Precedent for each Borrowing or Letter of Credit.
-----------------------------------------------------------
The obligation of each Bank to fund an Advance on the occasion of each Borrowing
(other than the Conversion or continuation of any existing Borrowing) and of any
Issuing Bank to issue or increase or extend any Letter of Credit shall be
subject to the further conditions precedent that on the date of such Borrowing
or the issuance or increase or extension of such Letter of Credit:
-57-
(a) the following statements shall be true (and each of the giving of the
applicable Notice of Borrowing and the acceptance by the Borrower of the
proceeds of such Borrowing or the issuance or increase or extension of such
Letter of Credit shall constitute a representation and warranty by the Borrower
that on the date of such Borrowing or the issuance or increase or extension of
such Letter of Credit such statements are true):
(i) the representations and warranties contained in Article IV hereof,
the Guaranties, the Environmental Indemnities and in each Security Document
and Participating Lessee Document are correct in all material respects on
and as of the date of such Borrowing or the issuance or increase or
extension of such Letter of Credit, before and after giving effect to such
Borrowing or to the issuance or increase or extension of such Letter of
Credit and to the application of the proceeds from such Borrowing, as
though made on and as of such date; and
(ii) no Default has occurred and is continuing or would result from such
Borrowing or from the application of the proceeds therefrom;
(b) the Borrower shall have executed and delivered to the Administrative
Agent a Borrowing Base Certificate dated not earlier than the date 10 days prior
to the anticipated date of such Borrowing;
(c) if all or a portion of such Borrowing is intended to be used to make
Capital Expenditures or purchase FF&E for a Hotel Property in connection with a
Major Renovation, the Administrative Agent shall have received (i) an analysis
of the amount of such renovation performed to date and the actual costs incurred
therefore versus an Approved Preliminary Property Plan or another budget for
such renovation in sufficient detail as the Administrative Agent shall
reasonably request, and (ii) invoices, lien waivers and any additional
information as the Administrative Agent may reasonably request; and
(d) the Administrative Agent shall have received such other approvals,
opinions or documents deemed necessary or desirable by any Bank, the
Structuring Agent or the Administrative Agent as such party may reasonably
request.
Section 3.03 Conditions Precedent for Initial Borrowing or Letter of
-------------------------------------------------------
Credit. The obligation of each Bank to fund an Advance on the occasion of the
------
first Borrowing and of any Issuing Bank to issue the first Letter of Credit
shall be subject to the further conditions precedent that on or prior to the
Escrow Breaking Deadline:
(a) The Borrower shall have executed and delivered to the Administrative
Agent the Borrower Funding Certificate and a Notice of Borrowing;
-58-
(b) The Borrower shall have paid the fees required under Section 2.03 and the
Agents' Fee Letter;
(c) The Agents shall have received evidence satisfactory to it that (i) the
Public Offering shall have been consummated pursuant to the Public Offering
Documents, (ii) the Administrative Agent shall have received executed or
conformed copies of each of the Public Offering Documents and all amendments
thereto, all in form and substance reasonably satisfactory to the Structuring
Agent, (iii) each of the Public Offering Documents shall be in full force and
effect, (iv) the Parent shall have received not less than $130,000,000 in
aggregate gross proceeds from the Public Offering (before deducting expenses and
underwriting discounts and commissions), (v) the Parent shall have contributed
such gross proceeds (net of such amount as may be required to pay underwriting
discounts and commissions and costs and expenses of the Public Offering and the
transactions contemplated hereby) to the Borrower as an equity contribution and
(vi) all other matters with respect to the Public Offering shall be reasonably
satisfactory to the Agents;
(d) The Agents shall have received an Officer's Certificate of the
Responsible Officer of the Parent certifying that, after giving effect to the
Public Offering, (i) the covenants set forth in Section 6.17 of this Agreement
are satisfied, (ii) the Parent owns 100% of the issued and outstanding shares of
the General Partner and AGH LP, (iv) the Parent has no first tier Subsidiaries
(other than the General Partner and AGH LP), (v) the General Partner owns a 1%
general partner interest and AGH LP owns at least 70% of the limited partnership
interests in the Borrower;
(e) The Pool Requirements are met; and
(f) the Agents shall have received such other approvals, opinions or
documents deemed necessary or desirable by any Bank, the Structuring Agent or
the Administrative Agent as such party may reasonably request.
If the conditions set forth in this Section 3.03 are not satisfied on or prior
to the Escrow Breaking Deadline, the obligation of each Bank to make Advances
and the obligation of each Issuing Bank to issue, increase, or extend Letters of
Credit shall immediately and automatically be terminated and the Notes, all
interest on the Notes, all Letter of Credit Obligations, and all other amounts
payable under this Agreement shall immediately and automatically become and be
due and payable in full, without presentment, demand, protest or any notice of
any kind (including, without limitation, any notice of intent to accelerate or
notice of acceleration), all of which are hereby expressly waived by the
Borrower. However, Borrower shall pay to the Agents all fees and expenses as
set forth in Agents' Fee Letter.
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Section 3.04 Conditions Precedent to a Hotel Property Qualifying as an
---------------------------------------------------------
Eligible Property. In order for an Initial Property or a Future Property to
-----------------
qualify initially and thereafter to continue to qualify as an Eligible Property,
the following conditions precedent must be satisfied and remain satisfied for
that Property:
(a) Documents and Information. The Administrative Agent shall have received
-------------------------
each of the following executed by the Borrower, the Property Owner or other
appropriate person, in form and substance satisfactory to the Agents:
(i) the original executed Property Security Documents and the
Participating Lessee Documents (except for the Credit Card Agreements and
the Depository Account Agreements with financial institutions other than
the Cash Manager);
(ii) a copy of each of the following for such Hotel Property certified
as true and correct by the Borrower pursuant to a Property Certificate:
A. If the Hotel Property is subject to a Franchise Agreement, the
Franchise Agreement and any requirements or conditions imposed by the
Franchisor at such time in connection with the Franchise Agreement,
including without limitation any requirements with respect to Capital
Expenditures or expenditures for FF&E for the Hotel Property;
B. Management Agreement;
C. Participating Lease;
D. List of the Personal Property for such Hotel Property;
E. Acquisition Agreements;
F. A rent roll for the Hotel Property identifying all rentable
space within the Hotel Property, the tenant, concessionaire or licensee (or
if vacant, identified as vacant), the monthly rental payable (including any
adjustments to operating expenses), the date through which rent is paid,
the termination date of each such leases, concessions and licenses and a
delinquency report.
G. The occupancy permit;
H. If the Hotel Property is subject to a Ground Lease, the Ground
Lease;
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I. The liquor license for such Hotel Property;
J. Liquor License Concession Agreement and any other agreements
related to the liquor license(s); and
K. The Property Owner's articles of incorporation, by-laws,
partnership agreements, as applicable, and certificates of existence, good
standing and authority to do business from each appropriate state
authority, and partnership or corporate, as applicable, authorizations
authorizing the execution, delivery and performance of the Security
Documents all certified to be true and complete by a duly authorized
officer of such Property Owner;
L. The Participating Lessee's articles of incorporation, by-laws,
partnership agreements, as applicable, and certificates of existence, good
standing and authority to do business from each appropriate state
authority, and partnership or corporate, as applicable, authorizations
authorizing the execution, delivery and performance of the Tenant Documents
all certified to be true and complete by a duly authorized officer of such
Property Owner;
(iii) a ALTA/ASCM survey of the Real Property certified in a manner
reasonably satisfactory to the Agents by a registered surveyor and dated no
more than ninety (90) days prior to the date the Borrower desires that such
Hotel Property be an Eligible Property;
(iv) all financial statements related to the Hotel Property (i)
reasonably required by the Agents; or (ii) necessary to provide the Agents
with a true and complete knowledge of the financial condition of the Hotel
Property;
(v) an Environmental Report;
(vi) an Engineering Report;
(vii) if available, a set of as-built plans for the Hotel Property;
(viii) either (A) evidence from the applicable Governmental Authority
of compliance with zoning for the Hotel Property, (B) a zoning endorsement
to the Title Policy, (C) legal opinion of compliance with zoning for the
Hotel Property in form reasonably acceptable to the Administrative Agent,
or (D) other evidence of compliance with zoning for the Hotel Property
reasonably acceptable to the Administrative Agent;
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(ix) a summary list of the Capital Expenditures and FF&E expenditures
for the Hotel Property for the immediately preceding 12-month period and an
estimate of the Capital Expenditures and FF&E expenditures for the upcoming
12-month period, certified by Borrower;
(x) a tenant estoppel certificate and subordination, non-disturbance and
attornment agreement in forms reasonably acceptable to the Agents from each
tenant of the Hotel Property which has a Material Lease;
(xi) certificates and policies of insurance evidencing that the Hotel
Property is covered by the insurance required pursuant to Section 5.10
hereof, provided that for the required earthquake insurance for the Initial
Properties the policy or policies for such earthquake insurance need only
be delivered within 30 days of the date of this Agreement;
(xii) a written opinion of the Borrower's counsel or counsels covering
such matters relating to the Property Owner, the Participating Lessee, the
Hotel Property, the Security Documents, the Participating Lessee Documents
as the Agents reasonably require;
(xiii) a Manager Consent; and
(xiv) all other documents reasonably required by either Agent.
(b) Recordation and Filing. The Mortgage, the Assignment of Leases
----------------------
(Borrower), the Assignment of Leases (Participating Lessee) and the
Participating Lessee Estoppel, shall each have been recorded in the Official
Public Records of Real Property of the County in which the Hotel Property is
located with all filing fees and applicable mortgage or intangible taxes paid by
Borrower. All appropriate Financing Statements (Borrower) and Financing
Statements (Participating Lessee) shall have been (a) filed with the Secretary
of State of the state in which the Hotel Property is located and the state in
which the Property Owner and Participating Lessee, as applicable, was formed and
of its respective principal place of business, and the Administrative Agent
shall have received a certificate of each Secretary of State showing such
financing statements to be subject to no prior filings; and (b) recorded in the
official records of all appropriate counties.
(c) Perfection; Priority. The Administrative Agent, as agent for the Banks,
--------------------
will have a valid, perfected first priority lien or security interest, as
applicable, in the Hotel Property (including without limitation the
Participating Lessee Pledged Property through the Collateral Assignment and
Security Agreement), subject only to the Permitted Encumbrances.
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(d) Title Insurance. Borrower shall, at its sole expense, have delivered to
---------------
the Administrative Agent the paid Title Policy insuring the Mortgage securing
the Obligations to be a valid, perfected first priority lien on the Real
Property covered thereby, subject only to the Permitted Encumbrances.
(e) Adverse Property Situation. Neither all nor any material portion of the
--------------------------
Hotel Property shall be the subject of any proceeding by a governmental
authority for the condemnation, seizure or appropriation thereof, nor the
subject of any negotiations for sale in lieu of condemnation, seizure or
appropriation. The Hotel Property shall not have been materially damaged or
destroyed by fire or other casualty which cannot be substantially restored or
repaired within ninety (90) days of such occurrence from the proceeds of
insurance maintained by the Borrower, nor shall all or any material portion of
the Hotel Property cease to be in operation; provided, however, that if the
Property Owner is receiving insurance proceeds under any business interruption
(not property) insurance in connection with such event, then such Hotel Property
shall not become ineligible as an Eligible Property because of such event though
the Property EBITDA for such Hotel Property will be adjusted downward to the
extent such proceeds result in a lower Property EBITDA for such Hotel Property.
(f) Appraisal. The Agents shall have received a current Appraisal of the
---------
Hotel Property satisfactory to the Agents.
(g) Subsidiary. In addition, if the Property Owner for such Hotel Property
----------
is not Borrower, the Property Owner is at least a 99%-owned Subsidiary of the
Borrower listed on Schedule 4.01 (other than a Permitted Other Subsidiary) or
Permitted New Subsidiary.
(h) New Guarantor. In addition, if the Property Owner for such Hotel
-------------
Property is not the Borrower or a Guarantor, the following:
(i) The Administrative Agent shall have received financial statements of
the Property Owner (i) reasonably required by the Agents; or (ii) necessary
to provide the Agents with a true and complete knowledge of the financial
condition of the Property Owner, all certified as true and correct by the
Borrower;
(ii) The Property Owner shall be a Permitted New Subsidiary whose sole
asset is the Future Property, who complies with all of the covenants and
requirements of Guarantors under the Credit Documents and who has delivered
to the Administrative Agent either (A) an original Guaranty and
Environmental Indemnity executed by such Subsidiary or (B) an Accession
Agreement executed by such Subsidiary.
(i) Future Property. In addition, if the Hotel Property is a Future
---------------
Property, the following:
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(i) The addition of the Future Property to the Eligible Property shall
not (A) cause the Eligible Property to violate the Pool Requirements, (B)
cause a Default, or (C) cause or result in the Borrower failing to comply
with any of the financial covenants contained herein;
(ii) The Borrower shall have delivered to the Administrative Agent and
the Banks the Property Information for such Future Property 20 days prior
to the date the Borrower proposes such Future Property qualify as an
Eligible Property;
(iii) the Majority Banks shall have approved such Future Property as a
possible Eligible Property and reached agreement with the Borrower as to
the Required Work for such Future Property, if any; and
(iv) within one hundred eighty (180) days of the date such Future
Property initially qualifies as an Eligible Property the Majority Banks
shall have approved the Approved Preliminary Property Plan for such Future
Property.
(j) Ground Leases. In addition, if the Hotel Property is subject to a Ground
-------------
Lease, no default by the lessee under the Ground Lease exists, the Ground Lease
remains in full force and effect and the Administrative Agent shall have
received a Ground Lessor Consent.
(k) Franchise Agreement. In addition, if the Hotel Property is subject to a
-------------------
Franchise Agreement, no default by the franchisee under the Franchise Agreement
exists, the Franchise Agreement remains in full force and effect and the
Administrative Agent shall have received a Franchisor Consent.
(l) Management Agreement Fees and Participating Lessee Net Income. The sum
-------------------------------------------------------------
of (i) the management fees payable to the Manager under the Management Agreement
for a Hotel Property whether payable by the Participating Lessee or the Property
Owner of such Hotel Property and (ii) the actual or expected Net Income for the
Participating Lessee for such Hotel Property shall not in the aggregate exceed
6% of the gross revenues for such Hotel Property.
(m) Depository Account Agreements and Credit Card Agreements. Within 30
--------------------------------------------------------
days of the initial date any property is deemed an Eligible Property but for the
requirements of this subsection (m), the Borrower shall have delivered to the
Administrative Agent the Depository Account Agreements for each financial
institution at which a Deposit Account for such Hotel Property is located
pursuant to the Cash Management System (Participating Lessee) and the Credit
Card Agreements for each credit card company for all major credit cards accepted
by such Hotel Property, which Depository Account Agreements, Credit Card
Agreements and the Cash Management Systems shall be in form and substance
reasonably satisfactory to the Agents.
-64-
(n) Hilton Hotel & Conference Center, Toledo, Ohio. If in connection with
----------------------------------------------
the Hotel Property commonly known as the Hilton Hotel & Conference Center,
Toledo, Ohio either (i) any utility service for such Hotel Property is
interrupted or materially decreased for more than 7 days because no easement or
other legal right exists across such Hotel Property's neighboring properties
permitting such service to the Hotel Property (a "Utility Interruption Event")
or (ii) the Borrower or the Property Owner for such Hotel Property receives
written notice that a Utility Interruption Event will occur and the Borrower and
the Property Owner fails to cure such anticipated Utility Interruption Event as
provided in clause (ii) of the following sentence on or prior to the date 90
days prior to the date such Utility Interruption Event is anticipated to occur,
then such Hotel Property will no longer be deemed an Eligible Property until
such situation is cured as provided in the following sentence. Such situation
will be deemed cured (i) with respect to a Utility Interruption Event, when such
service is restored to substantially the same level as prior to such
interruption or decrease and (ii) with respect to an anticipated Utility
Interruption Event, when the Property Owner shall have received such utility
easements of record and commenced construction and thereafter diligently
continued construction of any Capital Expenditures needed to receive such
affected service in substantially the same level as prior to such anticipated
Utility Interruption Event within a time frame that would prevent a Utility
Interruption Event, all as reasonably acceptable to the Administrative Agent.
(o) Participating Lease. In addition, if the Hotel Property is subject to a
-------------------
Participating Lease, no default by the Participating Lessee or the Property
Owner under the Participating Lease exists beyond any applicable cured period
(provided that for purposes of this subsection (o) such cure period will be
deemed to commence running when the Borrower, the Parent or a Guarantor has
knowledge of such default), the Participating Lease remains in full force and
effect and the Administrative Agent shall have received a Participating Lessee
Estoppel and the Participating Lessee Documents.
(p) Maison De Ville, New Orleans, Louisiana. For the Hotel Property commonly
---------------------------------------
known as the Maison De Ville, New Orleans, Louisiana, the Agents shall have
received a legal opinion or other evidence acceptable to the Agents that such
Hotel Property is exempt from or currently complies with the requirements of the
Americans with Disabilities Act, as amended.
(q) Other Actions. Borrower shall have executed and acknowledged (or caused
-------------
to be executed and acknowledged) and delivered to the Administrative Agent, on
behalf of the Banks, all documents, and taken all actions reasonably required by
Agents from time to time to confirm the rights created or now or hereafter
intended to be created under the Credit Documents, to protect and further the
validity, priority and enforceability of the Security Documents including
without limitation with respect to the Participating Lessee Documents and the
Participating Lessee Pledged
-65-
Property, to subject to the Security Documents and Participating Lessee Pledged
Property any Property intended by the terms of any such document to be covered
by the Security Documents or Participating Lessee Documents, as applicable, or
otherwise to carry out the purposes of the Credit Documents or Participating
Lessee Documents, as applicable, and the transactions contemplated thereunder.
The Agents shall have received all other evidence and information that they may
reasonably require.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants as follows:
Section 4.01 Existence; Qualification; Partners; Subsidiaries.
------------------------------------------------
(a) The Borrower is a limited partnership duly organized, validly existing,
and in good standing under the laws of Delaware and in good standing and
qualified to do business in each jurisdiction where its ownership or lease of
property or conduct of its business requires such qualification, except where
the failure to so qualify would not have a material adverse effect on the
Borrower.
(b) The Parent is a corporation duly organized, validly existing, and in good
standing under the laws of Maryland and in good standing and qualified to do
business in each jurisdiction where its ownership or lease of property or
conduct of its business requires such qualification, except where the failure to
so qualify would not have a material adverse effect on the Parent. The Parent
owns 100% of the issued and outstanding shares of the General Partner and AGH
LP. The Parent has no first tier Subsidiaries (other than the General Partner
and AGH LP).
(c) The General Partner is the Borrower's sole general partner with full
power and authority to bind the Borrower. The General Partner is a corporation
duly organized, validly existing, and in good standing under the laws of Nevada
and in good standing and qualified to do business in each jurisdiction where its
ownership or lease of property or conduct of its business requires such
qualification, except where the failure to so qualify would not have a material
adverse effect on the General Partner.
(d) AGH LP is a limited partnership duly organized, validly existing, and in
good standing under the laws of Nevada and in good standing and qualified to do
business in each jurisdiction where its ownership or lease of property or
conduct of its business requires such qualification, except where the failure to
so qualify would not have a material adverse effect on AGH LP.
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(e) As of the date of this Agreement, the General Partner owns a 1% general
partner interest in and AGH LP owns an approximately 79.2% limited partnership
interest in the Borrower.
(f) Each Subsidiary of the Borrower is a limited partnership, general
partnership or limited liability company duly organized, validly existing, and
in good standing under the laws of its jurisdiction of formation and in good
standing and qualified to do business in each jurisdiction where its ownership
or lease of property or conduct of its business requires such qualification,
except where the failure to so qualify would not have a material adverse effect
on such Subsidiary. The Borrower has no Subsidiaries on the date of this
Agreement other than the Subsidiaries listed on the attached Schedule 4.01, and
Schedule 4.01 lists the jurisdiction of formation and the address of the
principal office of each such Subsidiary existing on the date of this Agreement.
Schedule 4.01 hereto correctly sets forth the ownership interests in each
Subsidiary as of the date of this Agreement. As of the date of this Agreement,
the Borrower owns, directly or indirectly, at least 99% of the interests in each
such Subsidiary.
(g) To the knowledge of the Borrower, the Participating Lessee is a limited
partnership duly organized, validly existing, and in good standing under the
laws of Delaware and in good standing and qualified to do business in each
jurisdiction where its ownership or lease of property or conduct of its business
requires such qualification, except where the failure to so qualify would not
have a material adverse effect on the Participating Lessee. To the knowledge of
the Borrower, the sole general partner of the Participating Lessee is AGHL GP,
Inc. As of the date of this Agreement, to the knowledge of Borrower, ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇ legally and beneficially own, directly or
indirectly, approximately 77% of the partnership interests in the Participating
Lessee. As of the date of this Agreement, to the knowledge of Borrower, ▇▇▇▇▇
▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ legally and beneficially own
approximately 23% of the partnership interests in the Participating Lessee.
(h) To the knowledge of Borrower, the Manager is a corporation duly
organized, validly existing, and in good standing under the laws of Texas and in
good standing and qualified to do business in each jurisdiction where its
ownership or lease of property or conduct of its business requires such
qualification, except where the failure to so qualify would not have a material
adverse effect on the Manager. To the knowledge of the Borrower, as of the date
of this Agreement, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇ legally and
beneficially own, directly or indirectly, approximately 79% of the outstanding
shares of the Manager common stock. To the knowledge of the Borrower, as of the
date of this Agreement, ▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇ legally and
beneficially own approximately 21% of the outstanding shares of the Manager
common stock.
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(i) The principal place of business of the Borrower, the Parent, the
Participating Lessee and the Manager and their Subsidiaries is in the Dallas,
Texas metropolitan area. The principal place of business of the General Partner
and AGH LP is Las Vegas, Nevada.
Section 4.02 Partnership and Corporate Power. The execution, delivery, and
-------------------------------
performance by the Borrower, the Parent, and each Guarantor of the Credit
Documents to which it is a party and the consummation of the transactions
contemplated hereby and thereby (a) are within such Persons' partnership,
limited liability company and corporate powers, as applicable, (b) have been
duly authorized by all necessary corporate, limited liability company and
partnership action, as applicable, (c) do not contravene (i) such Person's
certificate or articles, as the case may be, of incorporation or by-laws,
operating agreement or partnership agreement, as applicable, or (ii) any law or
any contractual restriction binding on or affecting any such Person, the
contravention of which could reasonably be expected to cause a Material Adverse
Change, and (d) will not result in or require the creation or imposition of any
Lien prohibited by this Agreement. At the time of each Borrowing, such
Borrowing and the use of the proceeds of such Borrowing will be within the
Borrower's partnership ▇▇▇▇▇▇, ▇▇▇▇ have been duly authorized by all necessary
partnership action, (a) will not contravene (i) the Borrower's partnership
agreement or (ii) any law or any contractual restriction binding on or affecting
the Borrower, the contravention of which could reasonably be expected to cause a
Material Adverse Change, and (b) will not result in or require the creation or
imposition of any Lien prohibited by this Agreement.
Section 4.03 Authorization and Approvals.
---------------------------
(a) No authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority is required for the due execution,
delivery and performance by the Borrower, the Parent, or any Guarantor of the
Credit Documents to which it is a party or the consummation of the transactions
contemplated thereby. At the time of each Borrowing, no authorization or
approval or other action by, and no notice to or filing with, any Governmental
Authority will be required for such Borrowing or the use of the proceeds of such
Borrowing.
(b) The Parent Common Stock is duly and validly issued, fully paid and
nonassessable. The issuance and sale of such Parent Common Stock, upon issuance
and sale, will either (i) have been registered under applicable federal and
state securities laws or (ii) be exempt therefrom. The Parent Common Stock shall
at all times be duly listed on the New York Stock Exchange, Inc. and the Parent
shall use commercially reasonable efforts to timely file all reports required to
be filed by it with the New York Stock Exchange, Inc. and the Securities and
Exchange Commission.
Section 4.04 Enforceable Obligations. This Agreement, the Notes, and the
-----------------------
other Credit Documents to which the Borrower is a party have been duly executed
and delivered by the Borrower;
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each Guaranty and the other Credit Documents to which each Guarantor and the
Parent is a party have been duly executed and delivered by such Guarantor and
the Environmental Indemnity has been duly executed and delivered by the parties
thereto. Each Credit Document is the legal, valid, and binding obligation of
the Borrower, the Parent, and each Guarantor which is a party to it enforceable
against the Borrower, the Parent, and each such Guarantor in accordance with its
terms, except as such enforceability may be limited by any applicable
bankruptcy, insolvency, reorganization, moratorium, or similar law affecting
creditors' rights generally and by general principles of equity (whether
considered in proceeding at law or in equity). The Participating Lessee
Documents have been duly executed and delivered by the Participating Lessee.
Each Participating Lessee Document is the legal, valid, and binding obligation
of the Participating Lessee enforceable against the Participating Lessee in
accordance with its terms, except as such enforceability may be limited by any
applicable bankruptcy, insolvency, reorganization, moratorium, or similar law
affecting creditors' rights generally and by general principles of equity
(whether considered in proceeding at law or in equity).
Section 4.05 Public Offering. Upon consummation of the Public Offering,
---------------
(i) each of the Public Offering Documents shall be in full force and effect,
(ii) the Parent shall have received not less than $130,000,000 in aggregate
gross proceeds from the Public Offering, (iii) the Parent shall have contributed
such gross proceeds (net of such amount as may be required to pay costs and
expenses of the Public Offering and the transactions contemplated hereby) to the
Borrower as an equity contribution, and (iv) the Parent shall qualify as a real
estate investment trust under Sections 856-860 of the Code, as amended.
Section 4.06 Financial Statements.
--------------------
The Consolidated balance sheet of the Borrower and its Subsidiaries, and
the related Consolidated statements of operations, shareholders' equity and cash
flows, of the Borrower and its Subsidiaries contained in the Registration
Statement, fairly present the estimated financial condition in all material
respects and reflects the Indebtedness of the Borrower and its Subsidiaries as
of the dates indicated in the Registration Statement and the results of the
operations of the Borrower and its Subsidiaries for the periods indicated, and
such balance sheet and statements were prepared in accordance with GAAP. Since
the date of such statements, no Material Adverse Change has occurred.
Section 4.07 True and Complete Disclosure. No representation, warranty, or
----------------------------
other statement made by the Borrower (or on behalf of the Borrower) in this
Agreement or any other Credit Document or any representation, warranty, or other
statement made in the Registration Statement contains any untrue statement of a
material fact or omits to state any material fact necessary to make the
statements contained therein not misleading in light of the circumstances in
which they were
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made as of the date of this Agreement. There is no fact known to any
Responsible Officer of the Borrower or the Parent on the date of this Agreement
that has not been disclosed to the Agents which could reasonably be expected to
cause a Material Adverse Change. All projections, estimates, and pro forma
financial information furnished by the Borrower and the Parent or on behalf of
the Borrower or the Parent were prepared on the basis of assumptions, data,
information, tests, or conditions believed to be reasonable at the time such
projections, estimates, and pro forma financial information were furnished.
Section 4.08 Litigation. Except as set forth in the attached Schedule
----------
4.08, there is no pending or, to the best knowledge of the Borrower, threatened
action or proceeding affecting the Borrower, the Parent, the Manager, the
Participating Lessee or any of their respective Subsidiaries before any court,
Governmental Authority or arbitrator (provided that with respect to the giving
of this representation after the date of this Agreement, the representation
shall only be deemed to apply to those matters for which Administrative Agent
would have been entitled to notice under Section 5.05(n)).
Section 4.09 Use of Proceeds.
---------------
(a) Advances. The proceeds of the Advances have been, and will be used by
--------
the Borrower (i) to refinance the existing indebtedness of each Initial Property
which qualifies as an Eligible Property, (ii) to finance the acquisition of any
Future Property which either qualifies as an Eligible Property or a Permitted
Non-Eligible Property, (iii) to finance the renovation of, Capital Expenditures
for and FF&E for any Eligible Property or a Permitted Non-Eligible Property in
accordance with the provisions of Section 5.06, (iv) for general corporate
purposes of the Borrower and its Subsidiaries, including without limitation
expenses related to the Public Offering.
(b) Regulations. No proceeds of Advances will be used to purchase or carry
-----------
any margin stock in violation of Regulations G, T, U or X of the Federal Reserve
Board, as the same is from time to time in effect, and all official rulings and
interpretations thereunder or thereof. The Borrower is not engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock (within the meaning of Regulation U of the Federal Reserve Board).
Section 4.10 Investment Company Act. Neither the Borrower, the Parent nor
----------------------
any of their respective Subsidiaries is an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
Section 4.11 Taxes. All federal, state, local and foreign tax returns,
-----
reports and statements required to be filed (after giving effect to any
extension granted in the time for filing) by the Borrower, its Subsidiaries, or
any member of a Controlled Group have been filed with the
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appropriate governmental agencies in all jurisdictions in which such returns,
reports and statements are required to be filed, and where the failure to file
could reasonably be expected to cause a Material Adverse Change, except where
contested in good faith and by appropriate proceedings; and all taxes (which are
material in amount) and other impositions due and payable have been timely paid
prior to the date on which any fine, penalty, interest, late charge or loss may
be added thereto for non-payment thereof except where contested in good faith
and by appropriate proceedings. As of the date of this Agreement, neither the
Borrower nor any member of a Controlled Group has given, or been requested to
give, a waiver of the statute of limitations relating to the payment of any
federal, state, local or foreign taxes or other impositions. None of the
Property owned by the Borrower or any other member of a Controlled Group is
Property which the Borrower or any member of a Controlled Group is required to
treat as being owned by any other Person pursuant to the provisions of Section
168(f)(8) of the Code. Proper and accurate amounts have been withheld by the
Borrower and all members of each Controlled Group from their employees for all
periods to comply in all material respects with the tax, social security and
unemployment withholding provisions of applicable federal, state, local and
foreign law. Timely payment of all material sales and use taxes required by
applicable law have been made by the Borrower and all other members of each
Controlled Group, the failure to timely pay of which could reasonably be
expected to cause a Material Adverse Change. The amounts shown on all tax
returns to be due and payable have been paid in full or adequate provision
therefor is included on the books of the appropriate member of the applicable
Controlled Group.
Section 4.12 Pension Plans. All Plans are in compliance in all material
-------------
respects with all applicable provisions of ERISA. No Termination Event has
occurred with respect to any Plan, and each Plan has complied with and been
administered in all material respects in accordance with applicable provisions
of ERISA and the Code. No "accumulated funding deficiency" (as defined in
Section 302 of ERISA) has occurred and there has been no excise tax imposed
under Section 4971 of the Code. To the knowledge of any Responsible Officer of
the Borrower, no Reportable Event has occurred with respect to any Multiemployer
Plan, and each Multiemployer Plan has complied with and been administered in all
material respects with applicable provisions of ERISA and the Code. To the
knowledge of any Responsible Officer of the Borrower, neither the Borrower nor
any member of a Controlled Group has had a complete or partial withdrawal from
any Multiemployer Plan for which there is any material withdrawal liability. As
of the most recent valuation date applicable thereto, neither the Borrower nor
any member of a Controlled Group has received notice that any Multiemployer Plan
is insolvent or in reorganization.
Section 4.13 Condition of Hotel Property; Casualties; Condemnation. Except
-----------------------------------------------------
as disclosed in an Engineering Report, each Initial Property and any Future
Property (a) is and will continue to be in good repair, working order and
condition, normal wear and tear excepted, (b) is free of structural defects, (c)
is not subject to material deferred maintenance and (d) has and will have all
building
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systems contained therein and all other FF&E in good repair, working order and
condition, normal wear and tear excepted. None of the Properties of the
Borrower or of any of its Subsidiaries has been materially and adversely
affected as a result of any fire, explosion, earthquake, flood, drought,
windstorm, accident, strike or other labor disturbance, embargo, requisition or
taking of property or cancellation of contracts, permits or concessions by a
Governmental Authority, riot, activities of armed forces or acts of God or of
any public enemy. No condemnation or other like proceedings that has had, or
could reasonably be expected to result in, a Material Adverse Effect, are
pending and served nor, to the knowledge of the Borrower, threatened against any
Property in any manner whatsoever. No casualty has occurred to any Property that
could reasonably be expected to have a Material Adverse Effect.
Section 4.14 Insurance. The Borrower and each of its Subsidiaries carry
---------
the insurance required pursuant to the provisions of Section 5.10.
Section 4.15 No Burdensome Restrictions; No Defaults.
---------------------------------------
(a) Except as set forth on Schedule 4.15, neither the Borrower nor any of its
Subsidiaries is a party to any indenture, loan or credit agreement or any lease
except for the Participating Leases. Neither the Borrower, the Parent nor any of
their respective Subsidiaries is a party to any agreement or instrument or
subject to any charter or corporate restriction or provision of applicable law
or governmental regulation which could reasonably be expected to cause a
Material Adverse Change. Neither the Borrower, the Parent nor any of their
Subsidiaries is in default under or with respect to (i) any contract, agreement,
lease or other instrument which could reasonably be expected to cause a Material
Adverse Change or (ii) any Ground Lease, Participating Lease, Franchise
Agreement or Management Agreement except as disclosed to the Administrative
Agent in writing prior to the date such representation is deemed given. Neither
the Borrower, the Parent nor any of their Subsidiaries has received any notice
of default under any material contract, agreement, lease or other instrument
which is continuing and which, if not cured, could reasonably be expected to
cause a Material Adverse Change.
(b) No Default has occurred and is continuing (or with respect to the giving
of this representation after the date of this Agreement, as otherwise disclosed
to the Administrative Agent in writing after the date of this Agreement and
prior to the date such representation is deemed given).
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Section 4.16 Environmental Condition.
-----------------------
(a) Except as disclosed in the Environmental Reports (or with respect to the
giving of this representation after the date of this Agreement, as otherwise
disclosed to the Administrative Agent in writing after the date of this
Agreement and prior to the date such representation is deemed given), to the
knowledge of the Borrower, the Borrower and its Subsidiaries (i) have obtained
all Environmental Permits necessary for the ownership and operation of their
respective Properties and the conduct of their respective businesses; (ii) have
been and are in material compliance with all terms and conditions of such
Environmental Permits and with all other requirements of applicable
Environmental Laws; (iii) have not received notice of any violation or alleged
violation of any Environmental Law or Environmental Permit; and (iv) are not
subject to any actual or contingent Environmental Claim.
(b) Except as set forth in the Environmental Reports or the surveys for the
Hotel Properties, to the knowledge of Borrower, none of the present or
previously owned or operated Property of the Borrower or of any of its present
or former Subsidiaries, wherever located, (i) has been placed on or proposed to
be placed on the National Priorities List, the Comprehensive Environmental
Response Compensation Liability Information System list, or their state or local
analogs, or have been otherwise investigated, designated, listed, or identified
as a potential site for removal, remediation, cleanup, closure, restoration,
reclamation, or other response activity under any Environmental Laws which could
reasonably be expected to cause a Material Adverse Change; (ii) is subject to a
Lien, arising under or in connection with any Environmental Laws, that attaches
to any revenues or to any Property owned or operated by the Borrower or any of
its Subsidiaries, wherever located; (iii) has been the site of any Release, use
or storage of Hazardous Substances or Hazardous Wastes from present or past
operations except for Permitted Hazardous Substances, which Permitted Hazardous
Substances have not caused at the site or at any third-party site any condition
that has resulted in or could reasonably be expected to result in the need for
Response or (iv) none of the Improvements are constructed on land designated by
any Governmental Authority having land use jurisdiction as wetlands.
Section 4.17 Legal Requirements, Zoning, Utilities, Access. Except as set
---------------------------------------------
forth on Schedule 4.17 attached hereto, the use and operation of each Hotel
Property as a commercial hotel with related uses constitutes a legal use under
applicable zoning regulations (as the same may be modified by special use
permits or the granting of variances) and complies in all material respects with
all Legal Requirements, and does not violate in any material respect any
material approvals, material restrictions of record or any material agreement
affecting any Hotel Property (or any portion thereof). The Borrower and its
Subsidiaries possess all certificates of public convenience, authorizations,
permits, licenses, patents, patent rights or licenses, trademarks, trademark
rights, trade names rights and copyrights (collectively "Permits") required by
Governmental Authority to
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own and operate the Hotel Properties, except for those Permits if not obtained
would not cause a Material Adverse Change. The Borrower and its Subsidiaries
own and operate their business in material compliance with all applicable Legal
Requirements. To the extent necessary for the full utilization of each Hotel
Property in accordance with its current use, telephone services, gas, steam,
electric power, storm sewers, sanitary sewers and water facilities and all other
utility services are available to each Hotel Property, are adequate to serve
each such Hotel Property, exist at the boundaries of the Land and are not
subject to any conditions, other than normal charges to the utility supplier,
which would limit the use of such utilities. All streets and easements necessary
for the occupancy and operation of each Hotel Property are available to the
boundaries of the Land.
Section 4.18 Existing Mortgage Debt. Except for the Obligations, the only
----------------------
Indebtedness secured by a Lien on Real Property of the Borrower, the Parent or
any of their respective Subsidiaries existing as of the Effective Date is the
Permitted Other Subsidiary Indebtedness, and the respective amounts of such
Indebtedness is approximately the amounts set forth in the definition of
Permitted Other Subsidiary Indebtedness as of the Effective Date. No "default"
or "event of default", however defined, has occurred and is continuing under any
Permitted Other Subsidiary Loan Document or the Lien securing such Permitted
Other Subsidiary Indebtedness (or with respect to the giving of this
representation after the date of this Agreement, as otherwise disclosed to the
Administrative Agent in writing after the date of this Agreement and prior to
the date such representation is deemed given).
Section 4.19 Title; Encumbrances. On the date any Mortgage is filed
-------------------
covering an Eligible Property, the Borrower or any Guarantor, as the case may
be, will have (i) good and marketable fee simple title to the Real Property
(other than for Real Property subject to a Ground Lease, as to which it has a
valid leasehold or subleasehold interest) and (ii) good and marketable title to
the Personal Property (other than Personal Property for any Hotel Property (A)
which has been leased which does not in the aggregate exceed the Hotel Operating
Lease Limit or the Hotel Capital Lease Limit, as applicable, for such Hotel
Property and (B) for which the Property Owner has a valid leasehold interest)
free and clear of all Liens, and there will exist no Liens or other charges
against such Property or leasehold interest or any of the real or personal,
tangible or intangible, Property of the Borrower or any Guarantor (including
without limitation statutory and other Liens of mechanics, workers, contractors,
subcontractors, suppliers, taxing authorities and others), except (A) those
matters expressly set forth as permitted encumbrances in the respective
Mortgages covering such Property, (B) inchoate tax Liens and (C) the Personal
Property listed on Schedule 4.19 and the other Participating Lessee Pledged
Property (plus any replacements thereof) to which the Participating Lessee will
have good and marketable title to free and clear of all Liens. Upon the
recording of the Mortgages and the recording or filing of the other Security
Documents and Participating Lessee Documents, as applicable, the Administrative
Agent, as agent for the Banks, will have a valid, perfected first priority lien
or security interest, as applicable, in the Property of the Borrower and its
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Subsidiaries (other than the Permitted Other Subsidiaries) and the
Participating Lessee Pledged Property.
Section 4.20 Leasing Arrangements. The only leases of Real Property for
--------------------
which either the Borrower or a Guarantor is a lessee are the Ground Leases. The
Borrower or Guarantor which executes the Mortgage for a Real Property subject to
a Ground Lease is the lessee under such Ground Lease and no consent is necessary
to such Person being the lessee under such Ground Lease which has not already
been obtained. The Ground Leases are in full force and effect and no defaults
exist thereunder. The only participating leases burdening the Hotel Properties
are the Participating Leases. The Participating Leases are in full force and
effect and no defaults by the Borrower or any Subsidiary exist thereunder.
Section 4.21 Cash Management Systems. The summary of the Cash Management
-----------------------
Systems attached hereto as Schedule 4.21 is accurate and complete in all
material respects as of the Effective Date and does not omit to state any
material fact necessary to make the statements set forth therein not misleading.
Neither the Participating Lessee, the Borrower nor any of the Borrower's
Subsidiaries owns any Deposit Account which is not described in Schedule 4.21.
Schedule 4.21 lists all major credit cards accepted by the Hotel Properties.
There has been no change to the Cash Management Systems since the date of this
Agreement. The revenues from the DFW South and the Meadowlands are not
commingled with (a) the Deposit Accounts of the Participating Lessee, the
Borrower or any of the Permitted Other Subsidiaries for either the Eligible
Properties or the Permitted Non-Eligible Properties or (b) the Borrower's Bank
Accounts.
Section 4.22 Franchise Agreements. The only franchise or license
--------------------
agreements burdening the Hotel Properties are the Franchise Agreements. The
Participating Lessee which executes the Assignment of Management Agreement for a
Hotel Property subject to a Franchise Agreement is the licensee under such
Franchise Agreement and no consent is necessary to such Person being the
licensee under such Franchise Agreement which has not already been obtained.
The Franchise Agreements are in full force and effect and no defaults by the
Borrower or any Subsidiary exist thereunder (or with respect to the giving of
this representation after the date of this Agreement, as otherwise disclosed to
the Administrative Agent in writing after the date of this Agreement and prior
to the date such representation is deemed given). Schedule 4.22 sets forth, as
of the date of this Agreement, (a) which Franchise Agreements the Borrower
expects to terminate, (b) the expected date of such termination, (c) the
expected fees, if any, which will be owed to the Franchisor being terminated in
connection with such termination and (d) the expected replacement Franchisor and
the material terms of the expected replacement Franchise Agreement.
Section 4.23 Management Agreements. The only management agreements
---------------------
burdening the Hotel Properties are the Management Agreements. To the knowledge
of the Borrower, the
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Participating Lessee which executes the Assignment of Management Agreement for a
Hotel Property subject to a Management Agreement is the owner under such
Management Agreement and no consent is necessary to such Person being the owner
under such Management Agreement which has not already been obtained. To the
knowledge of the Borrower, the Management Agreements are in full force and
effect and no defaults by the Participating Lessee exist thereunder (or with
respect to the giving of this representation after the date of this Agreement,
as otherwise disclosed to the Administrative Agent in writing after the date of
this Agreement and prior to the date such representation is deemed given).
ARTICLE V
AFFIRMATIVE COVENANTS
So long as any Note or any amount under any Credit Document shall remain
unpaid, any Letter of Credit shall remain outstanding, or any Bank shall have
any Commitment hereunder, unless the Administrative Agent shall otherwise
consent in writing, the Borrower agrees to comply with the following covenants.
Section 5.01 Compliance with Laws, Etc. The Borrower will comply, and
-------------------------
cause each of its Subsidiaries to comply, in all material respects with all
Legal Requirements.
Section 5.02 Preservation of Corporate Existence; Corporate Separateness,
------------------------------------------------------------
Etc.
---
(a) The Borrower will preserve and maintain, and cause each of its
Subsidiaries to preserve and maintain, its partnership, limited liability
company or corporate (as applicable) existence, rights, franchises and
privileges in the jurisdiction of its formation, and qualify and remain
qualified, and cause each such Subsidiary to qualify and remain qualified, as a
foreign partnership or corporation as applicable in each jurisdiction in which
qualification is necessary or desirable in view of its business and operations
or the ownership of its properties, and, in each case, where failure to qualify
or preserve and maintain its rights and franchises could reasonably be expected
to cause a Material Adverse Change.
(b) The Borrower shall, and shall cause the Borrower's Subsidiaries, the
Parent and the Parent's Other Subsidiaries to, (i) maintain financial
statements, payroll records, accounting records and other corporate records and
other documents separate from each other and any other Person, (ii) maintain its
own bank accounts in its own name, separate from each other and any other
Person, (iii) pay its own expenses and other liabilities from its own assets and
incur (or endeavor to incur) obligations to other Persons based solely upon its
own assets and creditworthiness and not upon the creditworthiness of each other
or any other Person, and (iv) file its own tax returns or, if part of a
consolidated group, join in the consolidated tax return of such group as a
separate member thereof.
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The Borrower shall, and shall cause the Parent to, use reasonable efforts to
correct any known misunderstanding or misrepresentation regarding the
independence of the Parent and the Parent's Other Subsidiaries from the Borrower
and the Borrower's Subsidiaries.
(c) The Borrower shall, and shall cause the Permitted Other Subsidiaries to,
take all actions necessary to keep the Permitted Other Subsidiaries, separate
from the Borrower and the Borrower's other Subsidiaries, including, without
limitation, (i) the taking of action under the direction of the Board of
Directors, members or partners, as applicable, of the Permitted Other
Subsidiaries and, if so required by the Certificate of Incorporation or the
Bylaws, operating agreement or partnership agreement, as applicable, of the
Permitted Other Subsidiaries or by any Legal Requirement, the approval or
consent of the stockholders, members or partners, as applicable, of the
Permitted Other Subsidiaries, (ii) the preparation of corporate, partnership or
limited liability company minutes for or other appropriate evidence of each
significant transaction engaged in by the Permitted Other Subsidiaries, (iii)
the observance of separate approval procedures for the adoption of resolutions
by the Board of Directors or consents by the partners, as applicable, of the
Permitted Other Subsidiaries, on the one hand, and of the Borrower and the
Borrower's other Subsidiaries, on the other hand, and (iv) the holding of the
annual stockholders meeting, if applicable, of the Permitted Other Subsidiaries,
which are corporations on a date other than the date of the annual stockholders'
meeting of the General Partner or AGH LP.
(d) The Borrower shall, and shall cause the Permitted Other Subsidiaries to,
manage the business of and conduct the administrative activities of the
Permitted Other Subsidiaries independently from the business of the Borrower,
any of the Borrower's other Subsidiaries and any other Person. Any moneys
earned by the Permitted Other Subsidiaries on their assets or proceeds of the
sale of any of their assets shall be deposited in bank accounts separate from
any of the assets of the Borrower, any of the Borrower's other Subsidiaries and
any other Person, and no assets of the Permitted Other Subsidiaries shall become
commingled with assets of such Persons.
(e) The Borrower shall hold itself out, and shall continue to hold itself
out, to the public and to its creditors as a legal entity, separate and distinct
from all other entities, and shall continue to take all steps reasonably
necessary to avoid (i) misleading any other Person as to the identity of the
entity with which such Person is transacting business or (ii) implying that the
Borrower is, directly or indirectly, absolutely or contingently, responsible for
the Indebtedness or other obligations the Permitted Other Subsidiaries or any
other Person.
(f) The Borrower shall, and shall cause the Borrower's Subsidiaries, the
Parent, the Participating Lessee and the Manager and their Subsidiaries to
maintain their principal place of business in Dallas, Texas.
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Section 5.03 Payment of Taxes, Etc. The Borrower will pay and discharge,
---------------------
and cause each of its Subsidiaries to pay and discharge, before the same shall
become delinquent (a) all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or Property that are material in
amount, prior to the date on which penalties attach thereto and (b) all lawful
claims that are material in amount which, if unpaid, might by Legal Requirement
become a Lien upon its Property; provided, however, that neither the Borrower
-------- -------
nor any such Subsidiary shall be required to pay or discharge any such tax,
assessment, charge, levy, or claim (a) which is being contested in good faith
and by appropriate proceedings, (b) with respect to which reserves in conformity
with GAAP have been provided, (c) such charge or claim does not constitute and
is not secured by any cohate Lien on any portion of any Hotel Property and no
portion of any Hotel Property is in jeopardy of being sold, forfeited or lost
during or as a result of such contest, (d) neither the Agents nor any Bank could
become subject to any civil fine or penalty or criminal fine or penalty, in each
case as a result of non-payment of such charge or claim and (e) such contest
does not, and could not reasonably be expected to, result in a Material Adverse
Change.
Section 5.04 Visitation Rights; Bank Meeting. At any reasonable time and
-------------------------------
from time to time and so long as any visit or inspection will not unreasonably
interfere with the Borrower's or any of its Subsidiaries' operations, upon
reasonable notice, the Borrower will, and will cause its Subsidiaries to, permit
the Agents and any Bank or any of its agents or representatives thereof, to
examine and make copies of and abstracts from the records and books of account
of, and visit and inspect at its reasonable discretion the properties of, the
Borrower and any such Subsidiary, to discuss the affairs, finances and accounts
of the Borrower and any such Subsidiary with any of their respective officers or
directors. Without in any way limiting the foregoing, the Borrower will, upon
the request of either Agent, participate in a meeting with the Agents and the
Banks once during each calendar year to be held at the Borrower's office in
Dallas, Texas (or such other location as may be agreed to by the Borrower and
the Agents) at such time as may be agreed to by the Borrower and the Agents.
Section 5.05 Reporting Requirements. The Borrower will furnish to the
----------------------
Administrative Agent and each Bank:
(a) Monthly Financials. As soon as available and in any event not later than
------------------
45 days after the end of each calendar month, statements of the Capital
Expenditures and expenditures for FF&E and the operating income of each Hotel
Property owned by the Borrower, the Parent or any of their respective
Subsidiaries and for all such Hotel Properties in the aggregate (separately
aggregated for (i) the Borrower and the Borrower's Subsidiaries [including the
Permitted Other Subsidiaries], and (ii) the Parent and the Parent's
Subsidiaries) for such month, together with comparisons versus the budgeted
amounts for such Capital Expenditures and expenditures for FF&E and the
operating income of each Hotel Property and for all such Hotel Properties in the
aggregate as aforesaid for
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such month, duly certified by a Responsible Officer of the Borrower as having
been prepared in accordance with GAAP, together with a Compliance Certificate
duly executed by a Responsible Officer of the Borrower.
(b) Quarterly Financials. As soon as available and in any event not later
--------------------
than 45 days after the end of each quarter of each fiscal year of the Borrower
and the Parent, as applicable, the unaudited Consolidated balance sheets of
Borrower, the Parent and their respective Subsidiaries (separately aggregated
for (i) the Borrower and the Borrower's Subsidiaries [including the Permitted
Other Subsidiaries], and (ii) the Parent and the Parent's Subsidiaries) as of
the end of such quarter and the related unaudited statements of income,
shareholders' equity and cash flows of the Borrower, the Parent and their
respective Subsidiaries (separately aggregated for (i) the Borrower and the
Borrower's Subsidiaries [including the Permitted Other Subsidiaries], and (ii)
the Parent and the Parent's Subsidiaries) for the period commencing at the end
of the previous year and ending with the end of such quarter, and the
corresponding figures as at the end of, and for, the corresponding period in the
preceding fiscal year, all in reasonable detail by Hotel Property and duly
certified with respect to such statements (subject to year-end audit
adjustments) by a Responsible Officer of the Borrower and the Parent, as
applicable, as having been prepared in accordance with GAAP, together with (i) a
Compliance Certificate duly executed by a Responsible Officer of the Borrower
and (ii) a completed Borrowing Base Certificate duly executed by a Responsible
Officer of the Borrower setting forth the components of the Borrowing Base as of
the last day of the immediately preceding calendar quarter.
(c) Annual Financials. As soon as available and in any event not later than
-----------------
90 days after the end of each fiscal year of the Borrower and the Parent, as
applicable, (i) a copy of the annual audit report for such year for the
Borrower, the Parent and their respective Subsidiaries (separately aggregated
for (i) the Borrower and the Borrower's Subsidiaries [including the Permitted
Other Subsidiaries], and (ii) the Parent and the Parent's Subsidiaries) as of
the end of such fiscal year and the related Consolidated statements of income,
shareholders' equity and cash flows of the Borrower, the Parent and their
respective Subsidiaries (separately aggregated for (i) the Borrower and the
Borrower's Subsidiaries [including the Permitted Other Subsidiaries], and (ii)
the Parent and the Parent's Subsidiaries) for such fiscal year, and the
corresponding figures as at the end of, and for, the preceding fiscal year, in
each case certified by Coopers & ▇▇▇▇▇▇▇ L.L.P. or other independent certified
public accountants of nationally recognized standing reasonably acceptable to
the Agents and including, if requested by either Agent, any management letters
delivered by such accountants to the Borrower or the Parent in connection with
such audit together with a certificate of such accounting firm to the Banks
stating that, in the course of the regular audit of the business of the
Borrower, the Parent and their respective Subsidiaries, which audit was
conducted by such accounting firm in accordance with generally accepted auditing
standards, such accounting firm has obtained no knowledge that a Default has
occurred and is continuing, or if, in the opinion of such
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accounting firm, a Default has occurred and is continuing, a statement as to the
nature thereof, together with (A) a Compliance Certificate duly executed by a
Responsible Officer and (B) a completed Borrowing Base Certificate duly executed
by a Responsible Officer setting forth the components of the Borrowing Base as
of the last day of the immediately preceding calendar year and (ii) statements
of the Capital Expenditures, expenditures for FF&E and operating income of each
Hotel Property owned by the Borrower, the Parent or any of their respective
Subsidiaries and for all such Hotel Properties in the aggregate (separately
aggregated for (i) the Borrower and the Borrower's Subsidiaries [including the
Permitted Other Subsidiaries], and (ii) the Parent and the Parent's
Subsidiaries). During the occurrence of an Event of Default, either Agent can
require that the audited financial statements required under this Section
5.06(c) be provided for each of such Hotel Properties on a Consolidated and
consolidating basis.
(d) Manager Financials. As soon as available and in any event not later than
------------------
120 days after the end of each fiscal year of the Manager, as applicable, (i) a
copy of the annual audit report for such year for the Manager and its
Subsidiaries, if any, including therein audited Consolidated balance sheets of
the Manager and its Consolidated Subsidiaries as of the end of such fiscal year
and the related Consolidated statements of income, shareholders' equity and cash
flows of the Manager and its Subsidiaries for such fiscal year, and the
corresponding figures as at the end of, and for, the preceding fiscal year, in
each case certified by an independent certified public reasonably accountants
acceptable to the Agents and including, if requested by either Agent, any
management letters delivered by such accountants to the Manager in connection
with such audit. On or prior to the date 120 days following the date of this
Agreement, Borrower will cause the Manager to deliver the financial statements
required under this Section 5.05(d) for the fiscal year ending December 31,
1995.
(e) Annual Budgets. As soon as available and in any event not later than the
--------------
date 30 days prior to the start of each fiscal year, (i) the Consolidated annual
budgets of the Parent and its Subsidiaries for such upcoming fiscal year in
reasonable detail and duly certified by a Responsible Officer of the Parent as
the budgets presented or to be presented to the Parent's Board of Directors for
their review and (ii) annual budgets of the Capital Expenditures and
expenditures for FF&E and the operating income of each Hotel Property owned by
the Borrower, the Parent or any of their respective Subsidiaries and for all
such Hotel Properties in the aggregate (separately aggregated for (i) the
Borrower and the Borrower's Subsidiaries [including the Permitted Other
Subsidiaries], and (ii) the Parent and the Parent's Subsidiaries).
(f) Securities Law Filings. Promptly and in any event within 15 days after
----------------------
the sending or filing thereof, copies of all proxy material, reports and other
information which the Borrower, the Parent or any of their respective
Subsidiaries sends to or files with the United States Securities and Exchange
Commission or sends to all shareholders of the Parent or of any of its
Subsidiaries.
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(g) Defaults. As soon as possible and in any event within five days after
--------
the occurrence of each Default known to a Responsible Officer of the Borrower,
the Parent or any of their respective Subsidiaries, a statement of an authorized
financial officer or Responsible Officer of the Borrower setting forth the
details of such Default and the actions which the Borrower has taken and
proposes to take with respect thereto.
(h) ERISA Notices. As soon as possible and in any event (i) within 30 days
-------------
after the Borrower or any of a Controlled Group knows to know that any
Termination Event described in clause (a) of the definition of Termination Event
with respect to any Plan has occurred, (ii) within 10 days after the Borrower or
any of a Controlled Group knows to know that any other Termination Event with
respect to any Plan has occurred, a statement of the Chief Financial Officer of
the Borrower describing such Termination Event and the action, if any, which the
Borrower or such member of such Controlled Group proposes to take with respect
thereto; (iii) within 10 days after receipt thereof by the Borrower or any of a
Controlled Group from the PBGC, copies of each notice received by the Borrower
or any such member of such Controlled Group of the PBGC's intention to terminate
any Plan or to have a trustee appointed to administer any Plan; and (iv) within
10 days after receipt thereof by the Borrower or any member of a Controlled
Group from a Multiemployer Plan sponsor, a copy of each notice received by the
Borrower or any member of such Controlled Group concerning the imposition or
amount of withdrawal liability pursuant to Section 4202 of ERISA.
(i) Environmental Notices. Promptly upon the knowledge of any Responsible
---------------------
Officer of the Borrower of receipt thereof by the Borrower or any of its
Subsidiaries, a copy of any form of notice, summons or citation received from
the United States Environmental Protection Agency, or any other Governmental
Authority concerning (i) violations or alleged violations of Environmental Laws,
which seeks to impose liability therefor, (ii) any action or omission on the
part of the Parent or Borrower or any of their present or former Subsidiaries in
connection with Hazardous Waste or Hazardous Substances which, based upon
information reasonably available to the Borrower, could reasonably be expected
to cause a Material Adverse Change or an Environmental Claim in excess of
$1,000,000, (iii) any notice of potential responsibility under CERCLA, or (iv)
concerning the filing of a Lien upon, against or in connection with the Parent,
Borrower, their present or former Subsidiaries, or any of their leased or owned
Property, wherever located.
(j) Other Governmental Notices or Actions. Promptly and in any event within
-------------------------------------
five Business Days after receipt thereof by the Borrower, the Parent or any of
their respective Subsidiaries, (i) a copy of any notice, summons, citation, or
proceeding seeking to adversely modify in any material respect, revoke, or
suspend any license, permit, or other authorization from any Governmental
Authority, which action could reasonably be expected to cause a Material Adverse
Change, and (ii) any revocation or involuntary termination of any license,
permit or other authorization from any
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Governmental Authority, which revocation or termination could reasonably be
expected to cause a Material Adverse Change.
(k) Reports Affecting the Borrowing Base. On or prior to the 2nd day
------------------------------------
following any Adjustment Event, a Property Adjustment Report with respect to
such Adjustment Event.
(l) Press Releases. Promptly and in any event within 5 days after the
--------------
sending or releasing thereof, copies of all press releases or other releases of
information to the public by the Borrower, the Parent or any of their respective
Subsidiaries.
(m) Other Notices.
-------------
(i) Upon the request of either Agent, a certified rent roll listing all
of the Real Property of the Borrower and the Guarantors that are subject to
leases and containing such other information regarding such leases that
such Agent may reasonably request,
(ii) As soon as received, a copy of any notice of default or any other
material notice (including without limitation property condition reviews)
received by the Borrower or any Guarantor from any Franchisor, Manager, or
any ground lessor under a Ground Lease,
(iii) Promptly following any merger or dissolution of any Subsidiary of
the Borrower which is permitted hereunder or event which would make any of
the representations in Section 4.01-4.04 untrue, notice thereof, and
(iv) Promptly upon the occurrence of a Utility Interruption Event or
receipt of a notice of an anticipated Utility Interruption Event, notice of
such Utility Interruption Event or a copy of any such notice, as
applicable.
(n) Material Litigation. As soon as possible and in any event within five
-------------------
days of any Responsible Officer of the Borrower, the Parent or any of their
respective Subsidiaries having knowledge thereof, notice of any litigation,
claim or any other event which could reasonably be expected to cause a Material
Adverse Change.
(o) Other Information. Such other information respecting the business or
-----------------
Properties, or the condition or operations, financial or otherwise, of the
Borrower, the Parent or any of their respective Subsidiaries, as any Bank
through the Administrative Agent may from time to time reasonably request.
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Section 5.06 Maintenance of Property, Required Work and Approved
---------------------------------------------------
Preliminary Property Plan Work. The Borrower will, and will cause each of its
------------------------------
Subsidiaries to, (a) maintain their owned, leased, or operated Property in a
manner consistent for hotel properties and related property of the same quality
and character and shall keep or cause to be kept every part thereof and its
other properties in good condition and repair, reasonable wear and tear
excepted, and make all reasonably necessary repairs, renewals or replacements
thereto as may be reasonably necessary to conduct the business of the Borrower
and its Subsidiaries, (b) not remove, demolish or structurally alter, or permit
or suffer the removal, demolition or structural alteration of, any of the
Improvements except as expressly permitted hereunder or pursuant to an Approved
Preliminary Property Plan or with the prior written consent of the
Administrative Agent, (c) not knowingly or willfully permit the commission of
waste or other injury, or the occurrence of pollution, contamination or any
other condition in, on or about any Hotel Property, (d) maintain and repair each
Hotel Property as required by any Franchise Agreement, Management Agreement or
Ground Lease for such Hotel Property, and (e) commence the Required Work and
Approved Preliminary Property Plan Work for any Hotel Property by a date which
would allow a reasonable period of time to complete such work on or prior to the
Required Work Deadline for such Hotel Property, (f) after any commencement of
any of the work described in clause (e) of this Section 5.06 diligently perform
such Required Work or Approved Preliminary Property Plan Work, as applicable,
provide status reports in reasonable of the progress of the Required Work or
Approved Preliminary Property Plan Work, as applicable, to the Administrative
Agent within 45 days of the end of each calendar quarter and complete such
Required Work or Approved Preliminary Property Plan Work, as applicable, prior
to the Required Work Deadline (i) for the Required Work, as described in the
Engineering Reports and/or the Environmental Reports referred to in Schedule
5.06 or as otherwise described for any Future Property, (ii) in a good and
workmanlike manner and (iii) in compliance in all material respects with all
Legal Requirements. Upon the completion of the Required Work or any Major
Renovation for any Hotel Property, at the Borrower's expense, a property
condition consultant or engineer acceptable to the Agents shall inspect the
Hotel Property and deliver to the Administrative Agent a certificate that the
Required Work or the Major Renovation, as applicable, has been made or purchased
and delivered to such Hotel Property. Except as may be required to maintain the
Parent's status as a real estate investment trust under the Code, any Capital
Expenditures or expenditures or leases for FF&E made for any Hotel Property
shall be in the name of the Property Owner for such Hotel Property.
Section 5.07 CAPEX Reserve. On or prior to the date sixty days after the
-------------
date of each calendar quarter the Borrower will (i) deposit into the CAPEX
Reserve the CAPEX Reserve Deposit Amount for such calendar quarter and (ii)
deliver to the Administrative Agent a statement certified by a Responsible
Officer of the Borrower to be true and correct in all material respects, which
statement shall specify the calculation of such gross revenues and the amount of
such Capital Expenditures or FF&E and such other information reasonably
requested by the Administrative
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Agent. The CAPEX Reserve will be used to make or purchase Capital Expenditures
or FF&E (except for those made or purchased under an Approved Preliminary
Property Plan or Required Work performed for any Hotel Property after the date
which is 365 days following the date such Hotel Property initially qualified as
an Eligible Property) for Eligible Properties in accordance with this Agreement.
In addition to the Bank One Cash Management Agreement, Borrower shall execute
such Financing Statements and other documents and execute such other documents
as either Agent shall reasonably require in order for the Administrative Agent
to have a perfected first lien security interest in such CAPEX Reserve. Within
10 days after presentation to the Administration Agent of documentation
reasonably required the Administrative Agent (including without limitation
copies of invoices and a summary of Capital Expenditures) evidencing that in
accordance with this Agreement either (a) Capital Expenditures to an Eligible
Property have been performed or (b) FF&E has been purchased by the Borrower and
delivered to an Eligible Property, the Administrative Agent shall permit the
withdrawal from the CAPEX Reserve of the amounts for such Capital Expenditures
or FF&E (except for those made or purchased under an Approved Preliminary
Property Plan or Required Work performed for any Hotel Property after the date
which is 365 days following the date such Hotel Property initially qualified as
an Eligible Property), including payment to an escrow agent or title company to
disburse such amounts. Any requests for disbursements from the CAPEX Reserve
(a) shall not be made more often than once in any calendar month or for less
than $50,000, (b) shall be made contemporaneously with any request for a
Borrowing in such month pertaining to a Major Renovation, (c) shall be made
contemporaneously with a request for a Borrowing if in the month requested the
Borrower requests Borrowings on 2 days in such month, (d) shall not be made for
Capital Expenditures or FF&E made or purchased under an Approved Preliminary
Property Plan or Required Work performed for any Hotel Property after the date
which is 365 days following the date such Hotel Property initially qualified as
an Eligible Property, (e) shall also include the information and materials
required in the preceding sentence for all Capital Expenditures and FF&E
purchased with funds drawn out of the Concentration Bank Account and a
reconciliation of such amounts with the draws from the CAPEX Reserve and
Borrowings for such expenditures.
Section 5.08 Appraisals. The Borrower agrees that the Administrative Agent
----------
or the Majority Banks may from time to time obtain an Appraisal of any Hotel
Property and the Borrower shall, and shall cause each of its Subsidiaries to,
cooperate fully with the appraiser selected by the Administrative Agent or the
Majority Banks, as applicable, to conduct such Appraisals; it being understood
and agreed that the Borrower shall be required to pay the costs of such
Appraisal if either (a) the Person(s) requesting the Appraisal believe in their
reasonable discretion that Real Estate Value of the Hotel Property has
materially decreased or (b) an Event of Default has occurred. In the event that
the Borrower or any of its Subsidiaries obtains an Appraisal of any Hotel
Property other than pursuant to this subsection, the Borrower shall deliver a
copy of such appraisal to the Administrative Agent promptly upon the completion
thereof and the Administrative Agent may elect, in its sole discretion and
subject to Legal Requirements, to treat such appraisal as an
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"Appraisal." In the event that the Administrative Agent or the Majority Banks
obtains an Appraisal of any Hotel Property pursuant to the provisions of this
Section 5.08, such Person(s) shall deliver a copy of such Appraisal to the
Borrower upon the completion thereof.
Section 5.09 Duplicate Louisiana Notes. For each Hotel Property located
-------------------------
within the State of Louisiana, the Borrower agrees to execute an additional
promissory note for each Bank identical to the Note for such Bank which
additional promissory note (a) shall be held by the Administrative Agent to be
used in connection with the exercise of remedies against such Hotel Property in
accordance with Louisiana law and (b) shall not evidence any additional
Obligations. If any Note is exchanged or issued pursuant to the provisions of
Section 9.06(d), (a) the Borrower shall again execute additional promissory
notes identical to any new Notes issued by the Borrower and (b) the
Administrative Agent shall be authorized to exchange the promissory notes held
pursuant to the provisions of this Section 5.09 for the duplicates of the new
Notes.
Section 5.10 Insurance. The Borrower will maintain, and cause each of its
---------
Subsidiaries to maintain, the insurance required pursuant to Schedule 5.10.
Section 5.11 Casualty; Condemnation.
----------------------
(a) Any proceeds collected (the "Proceeds") under any fire or other physical
damage insurance policy described in this Agreement shall be disbursed as
provided in this Section 5.11. If (i) both (A) the Proceeds for any casualty are
in excess of twenty five percent (25%) of the Real Estate Value of the Hotel
Property affected by such casualty and (B) such casualty would result in a
decrease to the Borrowing Base which would require a prepayment of the
Obligations pursuant to the provisions of this Agreement, (ii) the casualty
shall have occurred within ninety (90) days of the Maturity Date or (iii) in the
Administrative Agent's discretion the casualty cannot be restored by a date
thirty (30) days prior to the Maturity Date, then at the Administrative Agent's
option and in its sole discretion, any Proceeds received by the Administrative
Agent shall be (A) disbursed to the Borrower for repairs and reconstruction;
and/or (B) applied against the outstanding principal balance of and/or unpaid
accrued interest on, the Notes in such order as the Administrative Agent chooses
in its sole discretion . If the Proceeds are not applied against the Notes as
provided in the preceding sentence, any Proceeds received by the Administrative
Agent shall be disbursed to the Borrower for repairs and reconstruction as
provided in Section 5.11(b) but only upon fulfillment of each of the following
conditions within 90 days following the occurrence of the damage for which the
Proceeds are collected:
(i) The Borrower shall demonstrate to the Administrative Agent's
reasonable satisfaction that the Proceeds, together with amounts deposited
by the Borrower pursuant to subparagraph (ii) will be adequate to
accomplish the repair and reconstruction of the
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Improvements and to restore the fair market value of the Hotel Property to
at least the value it had immediately prior to sustaining the damage. Such
demonstration shall include delivery to the Administrative Agent of (i)
plans and specifications satisfactory to the Administrative Agent; and (ii)
a construction contract in form and content, and with a contractor,
satisfactory to the Administrative Agent.
(ii) To the extent that the Proceeds are insufficient in the reasonable
determination of the Administrative Agent to accomplish the repairs and
reconstruction required above, the Borrower shall deliver to the
Administrative Agent funds (the "Shortfall Funds") in the amount of such
shortfall, which funds shall be, at the Administrative Agent's option,
assigned to the Administrative Agent as security for the Borrower's
obligations hereunder and shall be maintained with the Administrative Agent
and disbursed in the same manner as the Proceeds.
(iii) The Borrower shall execute such documents, in form and content
satisfactory to the Administrative Agent, as the Administrative Agent
requires to evidence and secure the Borrower's obligation to use all
amounts disbursed for the prompt repair and reconstruction of the Hotel
Property in accordance with the plans and specifications approved by the
Administrative Agent.
(iv) There shall have occurred no Default which is continuing or has not
otherwise been cured or waived, and the Administrative Agent shall have
received a certificate to that effect signed by a Responsible Officer of
the Borrower.
(b) Any Proceeds and Shortfall Funds to be disbursed to the Borrower shall be
held by the Administrative Agent and disbursed at such times and in such amounts
as the Administrative Agent shall reasonably deem necessary to fund the ongoing
repairs, provided the Administrative Agent is satisfied with such repairs. The
Administrative Agent shall have no obligation to disburse proceeds more than
once per month. Any amounts remaining undisbursed following completion of (and
full payment for) such repairs and reconstruction shall be returned to the
Borrower up to the amount of any Shortfall Funds deposited by Borrower, and any
other amounts remaining shall be applied against the outstanding principal
balance of and/or unpaid accrued interest on, the Notes, in such order as the
Administrative Agent chooses in its sole discretion.
(c) In the event the Borrower fails to fulfill the conditions set forth in
Sections 5.11(a)(i)-(iv) within 90 days following the date on which the damage
occurs, the Proceeds shall be applied by the Administrative Agent against the
outstanding principal balance of and/or unpaid accrued interest on, the Notes in
such order as the Administrative Agent chooses in its sole discretion.
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(d) The Borrower hereby assigns to the Administrative Agent, as security for
the Borrower's obligations under the Credit Documents, all compensation, awards
and other amounts payable to the Borrower in connection with any taking of any
portion of a Hotel Property for public use, and any proceeds of any related
settlement regardless of whether eminent domain proceedings are instituted in
connection therewith (collectively, "Compensation"). The Borrower shall deliver
all Compen sation to the Administrative Agent immediately upon receipt. If
such condemnation or taking would result in a decrease to the Borrowing Base
which would require a prepayment of the Obligations pursuant to the provisions
of this Agreement at the Administrative Agent's option and in its sole
discretion, any Compensation received by the Administrative Agent shall be (i)
disbursed to Borrower for repairs and reconstruction; and/or (ii) paid to
Borrower; and/or (iii) applied against the outstanding principal balance of
and/or unpaid accrued interest on, the Notes in such order as the Administrative
Agent chooses in its sole discretion; all in accordance with the rights,
procedures and other provisions set forth in Sections 5.11(a)-(c) for the
application of casualty insurance proceeds. Otherwise, the Compensation shall be
disbursed by the Administrative Agent to Borrower for repairs and
reconstruction.
Section 5.12 Cash Management Systems. The Borrower shall, and shall cause
-----------------------
each of its Subsidiaries and the Participating Lessee to, maintain the Cash
Management Systems. The Participating Lessee shall establish separate Deposit
Accounts for each Hotel Property with financial institutions having offices in
the same locale as the applicable Hotel Property. The Deposit Accounts for the
Eligible Properties shall be subject to a Depository Account Agreement in form
satisfactory to the Agents. The Participating Lessee also shall establish with
the Cash Manager a separate Operating Account (Participating Lessee) for each
Hotel Property. The Borrower also shall establish with the Cash Manager the
Borrower's Bank Accounts. As of the Effective Date, collections of cash and
cash equivalents for each Hotel Property (except for DFW South and Meadowlands
and any Permitted Non-Eligible Property) shall be deposited on a daily basis by
the Participating Lessee into the Deposit Account established for such Hotel
Property as part of the Cash Management System (Participating Lessee). The
Deposit Account for each Hotel Property (except for DFW South and Meadowlands
and any Permitted Non-Eligible Property) shall be swept at the end of each
Business Day into the respective Operating Account (Participating Lessee) for
such Hotel Property to reduce the net daily balance of good funds in such
Deposit Account to an amount, sufficient in the reasonable opinion of the
Agents, to cover usual and customary account fees and chargebacks applicable to
such Deposit Account. As provided in the Irrevocable Direction to Pay Rent, the
rental payments and other sums owed by the Participating Lessee to the Borrower
and the Borrower's Subsidiaries under the Participating Leases (except for DFW
South and Meadowlands) shall be paid into the Concentration Bank Account
established as part of the Cash Management System (Borrower) for the purpose of
holding and investing such rental payments. Except as provided in subsection (b)
below, the Parent, the Borrower, and their Subsidiaries shall have no right to
withdraw funds from, or otherwise transfer, pledge or assign any funds in the
Borrower's Bank
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Accounts except the pledge to the Administrative Agent pursuant to the Security
Agreement and the Bank One Cash Management Agreement. In addition, the Borrower
shall and shall cause each of its Subsidiaries and the Participating Lessee to,
perform and comply with the following covenants and agreements:
(a) Cash, cash equivalents and other revenues shall be received and held
by the Participating Lessee and any of its officers, employees, agents, managers
or other Persons acting for or in concert with the Participating Lessee to make
collections for or on behalf of the Participating Lessee ("Collecting Agents"),
in trust for the Borrower and the Borrower's Subsidiaries as collateral for the
Participating Lessee's obligations under the Participating Lease.
Notwithstanding any other provision of this Agreement or any other Credit
Document, all such cash, cash equivalents and other revenues from the Eligible
Properties shall be paid by the Collecting Agents into Deposit Accounts subject
to a Depository Account Agreement and the Cash Management Systems. Funds
received from credit card companies pursuant to the Credit Card Agreements for
any Hotel Property (except for DFW South and Meadowlands and any Permitted Non-
Eligible Property) shall be deposited either directly into the Operating Account
( Participating Lessee) for such Hotel Property or Deposit Account for such
Hotel Property subject to a Depository Account Agreement and the Cash Management
System (Participating Lessee).
(b) As long as no Default shall have occurred and be continuing or would
result therefrom, the Borrower may request, but not more often than once in any
calendar week, in written certificate from a Responsible Officer that the
Administrative Agent instruct the Cash Manager to either (i) apply Dollars on
deposit in the Concentration Bank Account to pay the Obligations, (ii) transfer
such Dollars to the CAPEX Reserve, (iii) transfer such Dollars as directed by
the Borrower or its Subsidiaries to make an investment permitted by the
provisions of Section 6.07 or (iv) transfer such Dollars to any of the Operating
Accounts (Borrower) as required by the Borrower to pay for Capital Expenditures,
FF&E, insurance premiums, taxes and general operating expenses incurred in the
ordinary course of business for the Hotel Properties (except for DFW South and
Meadowlands) and to make distributions to the Borrower's or its Subsidiaries
partners as permitted by the provisions of Section 6.04, in each case by
delivering such a request to the Administrative Agent in accordance with the
provisions of the Bank One Cash Management Agreement. Upon receipt by the
Administrative Agent of such a request, the Administrative Agent shall, as
applicable, instruct the Cash Manager to apply or transfer Dollars on deposit in
the Concentration Bank Account as so requested, in each case subject to the
availability of funds on deposit in the Concentration Bank Account. Funds
transferred into any of the Operating Accounts (Borrower) shall be withdrawn by
the Borrower or its Subsidiaries, as applicable, and used to pay for those
matters for which the Borrower had made request.
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(c) The Borrower or all Subsidiaries of Borrower (except for the
Permitted Other Subsidiaries) irrevocably makes, constitutes and appoints the
Administrative Agent, and all Persons designated by Administrative Agent for
that purpose (including the Cash Manager), at any time, as such Person's true
and lawful attorney-in-fact to, during the continuance of an Event of Default,
endorse such Person's name on any checks, notes, drafts or any other form of
payment relating to Hotel Property that come into the Administrative Agent's or
the Cash Manager's possession or under the Cash Managers or the Administrative
Agent's control; provided, however, that such appointment by such Person of the
-------- -------
Administrative Agent as such Person's attorney-in-fact shall in no case impose
upon the Administrative Agent or any such Person any obligation or duty to take
any actions on behalf of such Person or any fiduciary obligations with respect
to such Person.
(d) Within 30 days following the date of acquisition of an Initial
Property and within 30 days following the date of that the Borrower desires that
a Future Property qualify as an Eligible Property, the Borrower shall have
delivered to the Administrative Agent the Depository Account Agreements and the
Credit Card Agreements necessary to qualify such Hotel Property as an Eligible
Property, which documents shall be in form and substance reasonably satisfactory
to the Administrative Agent
(e) No cash, cash equivalents, credit card receipts or other revenues of
the Hotel Properties owned by the Permitted Other Subsidiaries or any other
assets of the Permitted Other Subsidiaries shall be commingled with cash, cash
equivalents, credit card receipts or other revenues collected or applied
pursuant to the Cash Management Systems or collected from the Permitted Non-
Eligible Properties.
Section 5.13 Initial Properties. Except for DFW South or Meadowlands, the
------------------
Borrower will use its best efforts to cause the Initial Properties to qualify as
Eligible Properties within thirty (30) days of the Effective Date, except for
the Maison De Ville, New Orleans, Louisiana for which the Borrower will use
reasonable efforts to qualify as an Eligible Property. If an Initial Property
does not qualify as an Eligible Property within thirty (30) days of the
Effective Date or later no longer qualifies as an Eligible Property, the
Borrower will cause any such Initial Property to qualify as a Permitted Non-
Eligible Property as provided in the definition of Permitted Non-Eligible
Property.
Section 5.14 Supplemental Guaranties. The Borrower has requested and the
-----------------------
Agents have agreed that any partner of the Borrower except the General Partner,
AGH LP or any Guarantor may execute a Supplemental Guaranty. However, the
execution of or release of any Supplemental Guaranty shall not be construed as a
release or modification of any obligation of a Guarantor under a Guaranty or
Environmental Indemnity.
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Section 5.15 Participating Leases. Upon knowledge of a default by a
--------------------
Participating Lessee under a Participating Lease or a Participating Lessee
Document, the Borrower will send, or will cause the Guarantor who is a party to
such Participating Lease or Participating Lessee Document to send, a notice of
such default to such Participating Lessee as provided in the document under
which such default has occurred.
ARTICLE VI
NEGATIVE COVENANTS
So long as any Note or any amount under any Credit Document shall remain
unpaid, any Letter of Credit shall remain outstanding, or any Bank shall have
any Commitment, the Borrower agrees, unless the Administrative Agent shall
otherwise consent in writing, to comply with the following covenants.
Section 6.01 Liens, Etc. The Borrower will not create, assume, incur or
----------
suffer to exist, or permit any of its Subsidiaries (except for Permitted Other
Subsidiaries) to create, assume, incur, or suffer to exist, any Lien on or in
respect of any of its Property whether now owned or hereafter acquired, or
assign any right to receive income, except that the Borrower and its
Subsidiaries may create, incur, assume or suffer to exist Liens:
(a) securing the Obligations;
(b) for taxes, assessments or governmental charges or levies on Property of
the Borrower or any Guarantor to the extent not required to be paid pursuant to
Sections 5.03;
(c) Liens imposed by law (such as landlords', carriers', warehousemen's and
mechanics' liens or otherwise arising from litigation) (a) which are being
contested in good faith and by appropriate proceedings, (b) with respect to
which reserves in conformity with GAAP have been provided, (c) such Liens are
subordinate to the Liens of the Security Documents and no portion of any Hotel
Property is in jeopardy of being sold, forfeited or lost during or as a result
of such contest, (d) neither the Agents nor any Bank could become subject to any
civil fine or penalty or criminal fine or penalty, in each case as a result of
non-payment of such charge or claim and (e) such contest does not, and could not
reasonably be expected to, result in a Material Adverse Change; and
(d) on leased personal property to secure solely the lease obligations
associated with such property.
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Section 6.02 Indebtedness. The Borrower will not incur or permit to exist,
------------
or permit any of its Subsidiaries to incur or permit to exist, any Indebtedness
other than the Obligations and the following:
(a) Permitted Other Subsidiary Indebtedness;
(b) Indebtedness in the form of Capital Leases for any particular Hotel
Property which have over the term of such Capital Leases payments in the
aggregate for all such Capital Leases for such Hotel Property for an amount
which does not exceed the Hotel Capital Lease Limit for such Hotel Property;
(c) Debt in the form of accounts payable to trade creditors for goods or
services for which not more than $50,000.00 for any two Hotel Properties is aged
more than 60 days from the billing date, incurred in the ordinary course of
business, as presently conducted, and paid within the specified time, unless
contested in good faith and by appropriate proceedings; and
(d) extensions, renewals and refinancing of any of the Indebtedness specified
in paragraphs (a) - (b) above so long as the principal amount of such
Indebtedness is not thereby increased.
The Borrower will cause the Parent and the Parent's Other Subsidiaries not to
incur or permit to exist any Indebtedness (except for Indebtedness of the type
listed in clauses (b) and (c) above) without the Majority Bank's written
consent; provided that such consent shall not be withheld if such Indebtedness
will not cause the Borrower or the Parent to breach another covenant of this
Credit Agreement and such Indebtedness will not cause a Material Adverse Change.
The Banks hereby consent to the Parent (a) guaranteeing to the lender under the
Indebtedness secured by the Meadowlands (i) the payment of rent under the ground
lease relating to the Meadowlands, (ii) real estate taxes relating to the
Meadowlands, (iii) capital reserves required under such Indebtedness, and (iv)
after a default under such Indebtedness, the base rent under the applicable
participating lease will be applied to such Indebtedness and (b) an indemnity
for certain acts of malfeasance, misappropriation and misconduct and an
environmental indemnity for the lender under the Indebtedness secured by the DFW
South.
Section 6.03 Agreements Restricting Distributions From Subsidiaries. The
------------------------------------------------------
Borrower will not, nor will it permit any of its Subsidiaries to, enter into any
agreement (other than a Credit Document) which limits distributions to or any
advance by any of the Borrower's Subsidiaries to the Borrower.
Section 6.04 Restricted Payments. The Borrower will not, and will not
-------------------
permit any of its Subsidiaries to, make any Restricted Payment, except that:
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(a) a Subsidiary of the Borrower may make a Restricted Payment to the
Borrower,
(b) provided no Default has occurred and is continuing or would result
therefrom, the Borrower may in any calendar quarter, based on the Rolling Period
for such calendar quarter, make cash distributions to its partners (including in
connection with the repurchase of partnership interests in the Borrower) which
with the previous cash distributions (including in connection with the
repurchase of partnership interests in the Borrower) in such Rolling Period are
not in excess of 90% of Funds from Operations during such Rolling Period,
including without limitation the Rolling Period ending June 30, 1997; provided,
however, that for the calendar quarters ended September 30, 1996, December 31,
1996 and March 31, 1997, the Borrower will be entitled to make additional
distributions to its partners (including in connection with the repurchase of
partnership interests in the Borrower) in an amount which when aggregated with
the other permitted distributions (including in connection with the repurchase
of partnership interests in the Borrower) would allow the Parent to pay a $.4075
per share dividend for such quarter;
(c) the Borrower shall be entitled to distribute to its partners a sufficient
amount received from an Asset Sale in excess of that which would be required to
be used to repay Obligations pursuant to the terms of this Agreement which would
be necessary to permit the Parent to maintain the Parent's status as a real
estate investment trust under the Code;
(d) the Borrower shall be entitled to and covenants to repay the existing
Indebtedness (other than the Obligations) secured by the Hotel Property commonly
known as the Holiday Inn - New Orleans Intercontinental Airport within 2 days of
the initial Borrowing;
(e) the limited partners of the Borrower shall be entitled to exchange
limited partnership interests in the Borrower for the Parent's stock in
accordance with the Registration Statement; and
(f) the Borrower shall be entitled to issue limited partnership interests in
the Borrower in exchange of ownership interests in Permitted New Subsidiaries
which own a Future Property.
Section 6.05 Fundamental Changes; Asset Sales. The Borrower will not, and
--------------------------------
will not permit any of its Subsidiaries (other than the Permitted Other
Subsidiaries) to, (a) merge or consolidate with or into any other Person, unless
(i) a Guarantor is merged into the Borrower and the Borrower is the surviving
Person, and (ii) immediately after giving effect to any such proposed
transaction no Default would exist; (b) sell, transfer, or otherwise dispose of
all or any of the Borrower's or any of the Borrower's Subsidiary's Property
except for a Permitted Hotel Sale, a Permitted Personal Property Replacement or
Hotel Properties which are not Eligible Properties; (c) enter into a Material
Lease (other than a Participating Lease) of all or any portion of any Eligible
Property with any Person without the consent of the Administrative Agent; (d)
sell or otherwise dispose of any shares
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of capital stock, membership interests or partnership interests of any
Subsidiary (except for a Permitted Other Subsidiary); (e) except for sales of
ownership interests permitted under this Agreement and the issuance or limited
partnership interests in the Borrower in exchange for ownership interests in a
Permitted New Subsidiary, alter the corporate, capital or legal structure of the
Borrower or any of its Subsidiaries (except for a Permitted Other Subsidiary);
(f) incorporate or otherwise organize any Subsidiaries except a Permitted New
Subsidiary; (g) liquidate, wind-up or dissolve itself (or suffer any liquidation
or dissolution) provided that nothing herein shall prohibit the Borrower from
dissolving any Subsidiary which has no assets on the date of dissolution.
Section 6.06 Personal Property Leases. For any Eligible Property, the
------------------------
Borrower will not, and will not permit any of its Subsidiaries to (a) enter into
leases of Personal Property which constitute Capital Leases in excess of the
Hotel Capital Lease Limit or (b) enter into leases of Personal Property which do
not constitute Capital Leases in excess of the Hotel Operating Lease Limit.
Section 6.07 Investments, Loans, Future Properties. The Borrower will not,
-------------------------------------
and will not permit any of its Subsidiaries to, acquire by purchase or otherwise
all or substantially all the business, property or fixed assets of any Person or
any Hotel Property, make or permit to exist any loans, advances or capital
contributions to, or make any investment in, or purchase or commit to purchase
any evidences of indebtedness of, stock or other securities, partnership
interests, member interests or other interests in any Person, except the
following (provided that after giving effect thereto there shall exist no
Default):
(a) the purchase of Liquid Investments with the Administration Agent;
(b) trade and customer accounts receivable (including in connection with the
sale of used FF&E) which are for goods furnished or services rendered in the
ordinary course of business and are payable in accordance with customary trade
terms;
(c) wholly-owned Subsidiaries which own an Initial Property;
(d) Permitted Other Subsidiaries;
(e) a Future Property which qualifies as an Eligible Property or a Permitted
Non-Eligible Property;
(f) contributions to, or capital investments in a Person which, prior to such
contribution or investment, is not a Subsidiary but which becomes a Permitted
New Subsidiary as a result of such contribution or investment and which
Permitted New Subsidiary uses such contributions or capital investments to make
an acquisition of a Future Property permitted under the preceding clause (e);
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(g) a loan to the Participating Lessee in amount sufficient to allow the
Participating Lessee to purchase Personal Property from the Property Owners of
the Hotel Properties which qualify as either an Eligible Property or a Permitted
Non-Eligible Property so that the ownership of Personal Property by such
Property Owners does not cause the Parent to forfeit the Parent's status as a
real estate investment trust under the Code;
(h) receivables purchased in connection with the acquisition of a Hotel
Property; and
(i) other assets owned in the ordinary course of owning the Borrower's and
the Borrower's Subsidiaries' Hotel Properties.
Section 6.08 Affiliate Transactions. Except for the Management Agreements,
----------------------
the Participating Lease Agreements, the Liquor License Concession Agreements,
the transactions described in Section 6.07(g), and as expressly permitted
elsewhere in this Agreement, the Borrower will not, and will not permit any of
its Subsidiaries to, make, directly or indirectly: (a) any transfer, sale,
lease, assignment or other disposal of any assets to any Affiliate of the
Borrower or any purchase or acquisition of assets from any such Affiliate except
for sales of new Personal Property (i) which in any calendar year do not exceed
$1,000,000 in the aggregate and (ii) for which the sales price is the actual
cost to the party selling; or (b) any arrangement or other transaction directly
or indirectly with or for the benefit of any such Affiliate (including without
limitation, guaranties and assumptions of obligations of an Affiliate), other
than in the ordinary course of business and at market rates.
Section 6.09 Sale and Leaseback. The Borrower will not, and will not
------------------
permit any of its Subsidiaries to, enter into any arrangement with any Person,
whereby in contemporaneous transactions the Borrower or such Subsidiary sells
essentially all of its right, title and interest in a material asset and the
Borrower or such Subsidiary acquires or leases back the right to use such
property.
Section 6.10 Sale or Discount of Receivables. The Borrower will not, and
-------------------------------
will not permit any of its Subsidiaries to, directly or indirectly, sell with
recourse, or discount or otherwise sell for less than the face value thereof,
any of its notes or accounts receivable.
Section 6.11 No Further Negative Pledges. The Borrower will not, and will
---------------------------
not permit any of its Subsidiaries to, enter into or suffer to exist any
agreement (other than this Agreement and the Credit Documents) (a) prohibiting
the creation or assumption of any Lien upon the Properties of the Borrower or
any of its Subsidiaries (except for the Permitted Other Subsidiaries), whether
now owned or hereafter acquired, or (b) requiring an obligation to be secured if
some other obligation is or becomes secured.
-94-
Section 6.12 Franchise Agreements. The Borrower will not, nor will it
--------------------
permit any of its Subsidiaries (other than Permitted Other Subsidiaries) or any
Participating Lessee to (i) enter into a new Franchise Agreement or (ii) enter
into any termination, or material modification or amendment of any Franchise
Agreement.
Section 6.13 Material Documents. The Borrower will not, nor will it permit
------------------
any of its Subsidiaries (other than Permitted Other Subsidiaries) or any
Participating Lessee to, enter into any termination, modification or amendment
of any:
(a) Management Agreement;
(b) Participating Lease;
(c) Ground Lease; and
(d) Participating Lessee Document.
The Borrower will not, nor will it permit any of its Subsidiaries (other than
Permitted Other Subsidiaries) or any Participating Lessee to, enter into any
termination or material modification or material amendment of any:
(a) Acquisition Agreement;
(b) Material Lease;
(c) Liquor License Concession Agreement and any agreements related to the
liquor license(s); and
(d) Any other material agreement.
Any termination, modification or amendment prohibited under this Section 6.13
without the Administrative Agent's written consent shall, to the extent
permitted by applicable law, be void and of no force and effect. The Borrower
will not, nor will it permit any of its Subsidiaries (other than Permitted Other
Subsidiaries) or any Participating Lessee to, enter into a Participating Lease
which does not provide for (i) base rent to be paid on a weekly basis starting
in the second month of the commencement of the Participating Lease or (ii) the
participating rent to be paid on monthly estimates with a quarterly
reconciliation which payments shall be made on the 10th day of the first and
third month of every calendar quarter and on the last day of the first month of
every calendar quarter.
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Section 6.14 Other Businesses; Undeveloped Land. The Borrower will not,
----------------------------------
and will not permit the Parent or any of their respective Subsidiaries to, (a)
substantially alter the character of their respective businesses from that
conducted as of the date of this Agreement or (b) acquire or develop any real
property except for the expansion of the DFW South or the Meadowlands or for the
acquisition of Land in connection with the expansion of an existing Hotel
Property which expansion will not cost in excess of the lesser of (i) $1,000,000
or (ii) five percent (5%) of the Cost Basis of such Hotel Property.
Section 6.15 Borrower Debt Service Ratio. The Borrower will not permit the
---------------------------
ratio, determined as of the last day of each calendar quarter (commencing with
the quarter ending September 30, 1996), of (a) Borrowing Base EBITDA for the
Rolling Period ending on such date to (b) the product of (i) the Consolidated
Indebtedness of the Borrower and the Borrower's Subsidiaries (other than the
Permitted Other Subsidiaries) as of such date times (ii) the Debt Service Rate
-----
for such Indebtedness for such Rolling Period, to be less than 1.75 to 1.0.
Section 6.16 Parent Debt Service Ratio. The Borrower will not permit the
-------------------------
ratio, determined as of the last day of each calendar quarter (commencing with
the quarter ending September 30, 1996), of (a) the Property EBITDA of all Hotel
Properties owned by the Parent and the Parent's Subsidiaries (including without
limitation the Borrower, the Borrower's Subsidiaries and the Permitted Other
Subsidiaries) for the Rolling Period ending on such date to (b) the product of
(i) the Consolidated Indebtedness of the Parent and the Parent's Subsidiaries as
of such date times (ii) the Debt Service Rate for such Indebtedness for such
-----
Rolling Period, to be less than 1.75 to 1.0.
Section 6.17 Net Worth. The Borrower will not permit the Parent's
---------
Consolidated Net Worth at any time, tested quarterly, to be less than the sum of
(a) $100,000,000 plus ( b) 75% of the Net Cash Proceeds from a Parent
----
Capitalization Event after the Effective Date involving any sale or issuance by
the Parent or any of its Subsidiaries of equity securities.
Section 6.18 Bank Accounts.
-------------
(a) Location of Borrower's Bank Accounts. Neither the Borrower nor any of
------------------------------------
its Subsidiaries (except the Permitted Other Subsidiaries) shall maintain
accounts with any bank or financial institution except those accounts in the
Cash Management System (Borrower).
(b) Concentration Bank Accounts. Neither the Borrower nor any Guarantor
---------------------------
shall move or cancel any of the Borrower's Bank Accounts or make any changes to
the Cash Management System (Borrower) without the prior written consent of the
Administrative Agent.
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(c) Location of Participating Lessee Bank Accounts. The Participating Lessee
----------------------------------------------
shall not maintain accounts with any bank or financial institution except those
accounts in the Cash Management System (Participating Lessee) and those accounts
maintained in connection with DFW South or the Meadowlands.
ARTICLE VII
EVENTS OF DEFAULT; REMEDIES
Section 7.01 Events of Default. The occurrence of any of the following
-----------------
events shall constitute an "Event of Default" under any Credit Document:
(a) Principal or Reimbursement Obligation Payment. The Borrower shall fail
---------------------------------------------
to pay any principal of any Note or any Reimbursement Obligation when the same
becomes due and payable as set forth in this Agreement;
(b) Interest or Other Obligation Payment. The Borrower shall fail to pay any
------------------------------------
interest on any Note or any fee or other amount payable hereunder or under any
other Credit Document when the same becomes due and payable as set forth in this
Agreement, provided however that the Borrower will have a grace period of five
days after the payments covered by this Section 7.01(b) becomes due and payable
for the first two defaults under this Section 7.01(b) in every calendar year;
(c) Representation and Warranties. Any representation or warranty made or
-----------------------------
deemed to be made (i) by the Borrower in this Agreement or in any other Credit
Document, (ii) by the Borrower (or any of its officers) in connection with this
Agreement or any other Credit Document, or (iii) by any Subsidiary in any Credit
Document shall prove to have been incorrect in any material respect when made or
deemed to be made;
(d) Covenant Breaches. (i) The Borrower shall fail to perform or observe any
-----------------
covenant contained in Sections 5.02, 5.03, ▇▇▇▇▇▇▇ ▇.▇▇, ▇▇▇▇▇▇▇ ▇.▇▇ (▇), (▇),
(▇), (▇), (▇) or (n) or Article VI of this Agreement or the Borrower shall fail
to perform or observe, or shall fail to cause any Guarantor to perform or
observe any covenant in any Security Document beyond any notice and/or cure
period for such default expressly provided in such Security Document or (ii) the
Borrower or any Guarantor shall fail to perform or observe any term or covenant
set forth in any Credit Document which is not covered by clause (i) above or any
other provision of this Section 7.01, in each case if such failure shall remain
unremedied for 30 days after the earlier of the date written notice of such
default shall have been given to the Borrower or such Guarantor by the
Administrative Agent or any Bank or the date a Responsible Officer of the
Borrower or any Guarantor has actual knowledge of such default, unless such
default in this clause (ii) cannot be cured in such 30 day period and the
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Borrower is diligently proceeding to cure such default, in which event the cure
period shall be extended to 90 days;
(e) Cross-Defaults. (i) The Borrower, the Parent or any of their respective
--------------
Subsidiaries shall fail to pay any principal of or premium or interest on its
Indebtedness which is outstanding in a principal amount of at least $5,000,000
individually or when aggregated with all such Indebtedness of the Borrower, the
Parent or any of their respective Subsidiaries so in default (but excluding
Indebtedness evidenced by the Notes) when the same becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace period,
if any, specified in the agreement or instrument relating to such Indebtedness;
(ii) any other event shall occur or condition shall exist under any agreement or
instrument relating to Indebtedness which is outstanding in a principal amount
of at least $5,000,000 individually or when aggregated with all such
Indebtedness of the Borrower, the Parent or any of their respective Subsidiaries
so in default, and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate the maturity of such Indebtedness; or (iii) any such
Indebtedness shall be declared to be due and payable, or required to be prepaid
(other than by a regularly scheduled required prepayment), prior to the stated
maturity thereof;
(f) Insolvency. The Borrower, the Parent, any of their respective
----------
Subsidiaries, or the Participating Lessee shall generally not pay its debts as
such debts become due, or shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors; or
any proceeding shall be instituted by or against the Borrower, the Parent, any
of their respective Subsidiaries, or the Participating Lessee seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee or other similar official for it or
for any substantial part of its property and, in the case of any such proceeding
instituted against the Borrower, the Parent, any of their respective
Subsidiaries, or the Participating Lessee, either such proceeding shall remain
undismissed for a period of 60 days or any of the actions sought in such
proceeding shall occur; or the Borrower, the Parent, any of their respective
Subsidiaries, or the Participating Lessee shall take any corporate action to
authorize any of the actions set forth above in this paragraph (f);
(g) Judgments. Any judgment or order for the payment of money in excess of
---------
$5,000,000 (reduced for purposes of this paragraph for the amount in respect of
such judgment or order that a reputable insurer has acknowledged being payable
under any valid and enforceable insurance policy) shall be rendered against the
Borrower, the Parent or any of their respective Subsidiaries which,
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within 30 days from the date such judgment is entered, shall not have been
discharged or execution thereof stayed pending appeal;
(h) ERISA. (i) Any Person shall engage in any "prohibited transaction" (as
-----
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan, (iii) a Reportable
Event shall occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is likely to result in the termination of such Plan for
purposes of Title IV of ERISA, unless such Reportable Event, proceedings or
appointment are being contested by the Borrower in good faith and by appropriate
proceedings, (iv) any Plan shall terminate for purposes of Title IV of ERISA,
(v) the Borrower or any member of a Controlled Group shall incur any liability
in connection with a withdrawal from a Multiemployer Plan or the insolvency
(within the meaning of Section 4245 of ERISA) or reorganization (within the
meaning of Section 4241 of ERISA) of a Multiemployer Plan, unless such liability
is being contested by the Borrower in good faith and by appropriate proceedings,
or (vi) any other event or condition shall occur or exist, with respect to a
Plan; and in each case in clauses (i) through (vi) above, such event or
condition, together with all other such events or conditions, if any, could
subject the Borrower or any Guarantor to any tax, penalty or other liabilities
in the aggregate exceeding $10,000,000;
(i) Guaranty. Any provision of any Guaranty except a Supplemental Guaranty
--------
shall for any reason cease to be valid and binding on any Guarantor or any
Guarantor shall so state in writing;
(j) Environmental Indemnity. Any provision of any Environmental Indemnity
-----------------------
shall for any reason cease to be valid and binding on any Person party thereto
or any such Person shall so state in writing;
(k) Invalidity of Subordination Provisions. The subordination provisions in
--------------------------------------
the Mortgages which provide for the subordination of the Participating Leases to
the liens and security interests securing the Obligations shall be invalidated
or otherwise cease to be in full force and effect;
(l) Franchise Agreement. Any Franchise Agreement has been terminated and not
-------------------
replaced within 60 days of such termination with a temporary Franchise Agreement
with a nationally recognized Franchisor acceptable to the Majority Banks, any
temporary Franchise Agreement has been terminated and not replaced with a long-
term Franchise Agreement with a nationally recognized Franchisor acceptable to
the Majority Banks, or any three (3) Franchise Agreements shall be in default at
the same time;
-99-
(m) Default Under Ground Lease. The occurrence of a default under any Ground
--------------------------
Lease which has not been cured or waived (i) 10 days prior to the date the
ground lessor under such Ground Lease would have the right to terminate such
Ground Lease and (ii) in any event within 30 days of the occurrence of such
default;
(n) Manager. The Participating Lessee shall not have replaced the Manager
-------
with a reputable, nationally known, third party manager acceptable to the
Majority Banks within 120 days of the occurrence of any of the following: Any
Management Agreement shall have been terminated except in connection with an
Asset Sale, or the Manager shall have a Consolidated Net Worth of less than
negative $300,000, or shall generally not pay its debts as such debts become
due, or shall admit in writing its inability to pay its debts generally, or
shall make a general assignment for the benefit of creditors; or any proceeding
shall be instituted by or against the Manager or any of its Subsidiaries seeking
to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee or other similar official for it or
for any substantial part of its property and, in the case of any such proceeding
instituted against the Manager or any of its Subsidiaries, either such
proceeding shall remain undismissed for a period of 60 days or any of the
actions sought in such proceeding shall occur; or the Manager or any of its
Subsidiaries shall take any corporate action to authorize any of the actions set
forth above in this paragraph (n); or
(o) Parent's REIT Status. There shall be a determination from the
--------------------
applicable Governmental Authority from which no appeal can be taken that the
Parent's tax status as a real estate investment trust under Sections 856-860 of
the Code has been lost.
(p) Parent's Indebtedness; Other Tests. Either of the following events
----------------------------------
continues to exist 5 days following the initial occurrence thereof: (i) the
aggregate Indebtedness of the Parent and the Parent's Subsidiaries (including
without limitation the Borrower, the Borrower's Subsidiaries and the Permitted
Other Subsidiaries) exceeds the lesser of (A) 45% of the Real Estate Value of
all Hotel Properties owned by the Parent and the Parent's Subsidiaries
(including without limitation the Borrower, the Borrower's Subsidiaries and the
Permitted Other Subsidiaries); and (B) the product of (A) the aggregate trailing
12 months Property EBITDA for all Hotel Properties owned by the Parent and the
Parent's Subsidiaries (including without limitation the Borrower, the Borrower's
Subsidiaries and the Permitted Other Subsidiaries) multiplied by (B) 5.5 or (ii)
the Parent and the Parent's Subsidiaries fail to comply with the covenants set
forth in Section 6.16 and 6.17.
(q) Parent Common Stock; Parent Capitalization Event The Parent at any time
------------------------------------------------
hereafter fails to (a) cause the Parent Common Stock to be duly listed on the
New York Stock Exchange, Inc. and (b) file timely all reports required to be
filed by the Parent with the New York Stock Exchange,
-100-
Inc. and the Securities and Exchange Commission and, with respect to a failure
under clause (b), such failure remains uncured on the date which is the earlier
of (i) the date 30 days following the initial occurrence of such failure and
(ii) the date specified by the New York Stock Exchange, Inc. or the Securities
and Exchange Commission as the date such failure needs to be cured by. Upon the
receipt by the Parent of any Net Cash Proceeds from a Parent Capitalization
Event, (a) the Parent fails to immediately make a capital contribution to the
Borrower in the aggregate amount of such Net Cash Proceeds or (b) the Borrower
fails to apply such Net Cash Proceeds to repay any outstanding principal of the
Notes, and accrued and unpaid interest thereon and other amounts payable by the
Borrower in respect thereof.
(r) Changes in Ownership. Any of the following occur without the written
--------------------
consent of the Agents: (a) the Parent owns less than 100% of the stock and
beneficial ownership interest in the General Partner and AGH LP; (b) the General
Partner and AGH LP (i) amend the Borrower's partnership agreement in any
material respect, (ii) admit a new general partner to the Borrower, or (iii) own
less than 51% of the partnership interests in and beneficial ownership of the
Borrower; (c) the General Partner resigns as general partner of the Borrower;
(d) ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇ and
their respective Associates legally and beneficially own less than 65% of the
outstanding shares of the Manager common stock; (e) ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇ or any of their respective Associates sells or assigns either the legal or
beneficial interest in any outstanding shares of the Manager common stock except
to ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇ or any of their respective Associates; (f)
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇ and their
respective Associates legally and beneficially owns less than 65% of the
partnership interests in the Participating Lessee; and (g) ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇
▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ or any of their respective Associates sells or
assigns either the legal or beneficial interest in any partnership interests in
the Participating Lessee except to ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇.
▇▇▇▇ or any of their respective Associates.
(s) Participating Lessee. Either (i) a default by the Participating Lessee
--------------------
shall occur under any Participating Lease or Participating Lessee Document or
Participating Lessee Estoppel related to 3 or more Eligible Properties which
shall remain uncured following any notice and cure period under such document,
(ii) the Participating Lessee suffers to exist (for a period in excess of 30
days), creates, assumes or incurs, any Lien on or in respect of any of the
Participating Lessee Pledged Property whether now owned or hereafter acquired,
or assigns any right to receive income except for those Liens created pursuant
to the Participating Lessee Documents, (iii) with respect to 3 or more Eligible
Properties, (A) the Participating Lease or Participating Lessee Document for any
Hotel Property is terminated and the Administrative Agent on behalf of the Banks
no longer has a perfected first lien and security interest in the Participating
Lessee Pledged Property for such Hotel Property or (B) any Participating Lessee
Estoppel is terminated, or (iv) the Participating Lessee
-101-
enters into a Participating Lease or other material agreement except those
directly related to a Hotel Property owned by the Borrower or any of the
Borrower's Subsidiaries.
Section 7.02 Optional Acceleration of Maturity. If any Event of Default
---------------------------------
(other than an Event of Default pursuant to paragraph (f) of Section 7.01) shall
have occurred and be continuing, then, and in any such event,
(a) the Administrative Agent (i) shall at the request, or may with the
consent, of the Majority Banks, by notice to the Borrower, declare the
obligation of each Bank to make Advances and the obligation of each Issuing Bank
to issue, increase, or extend Letters of Credit to be terminated, whereupon the
same shall forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Majority Banks, by notice to the Borrower, declare the Notes,
all interest thereon, the Letter of Credit Obligations, and all other amounts
payable under this Agreement to be forthwith due and payable, whereupon the
Notes, all such interest, all such Letter of Credit Obligations and all such
amounts shall become and be forthwith due and payable in full, without
presentment, demand, protest or further notice of any kind (including, without
limitation, any notice of intent to accelerate or notice of acceleration), all
of which are hereby expressly waived by the Borrower, and
(b) the Borrower shall, on demand of the Administrative Agent at the request
or with the consent of the Majority Banks, deposit with the Administrative Agent
into the Cash Collateral Account an amount of cash equal to the Letter of Credit
Exposure as security for the Obligations to the extent the Letter of Credit
Obligations are not otherwise paid at such time.
Section 7.03 Automatic Acceleration of Maturity. If any Event of Default
----------------------------------
pursuant to paragraph (f) of Section 7.01 shall occur,
(a) the obligation of each Bank to make Advances and the obligation of each
Issuing Bank to issue, increase, or extend Letters of Credit shall immediately
and automatically be terminated and the Notes, all interest on the Notes, all
Letter of Credit Obligations, and all other amounts payable under this Agreement
shall immediately and automatically become and be due and payable in full,
without presentment, demand, protest or any notice of any kind (including,
without limitation, any notice of intent to accelerate or notice of
acceleration), all of which are hereby expressly waived by the Borrower and
(b) to the extent permitted by law or court order, the Borrower shall deposit
with the Administrative Agent into the Cash Collateral Account an amount of cash
equal to the outstanding Letter of Credit Exposure as security for the
Obligations to the extent the Letter of Credit Obligations are not otherwise
paid at such time.
-102-
Section 7.04 Cash Collateral Account.
-----------------------
(a) Pledge. The Borrower hereby pledges, and grants to the Administrative
------
Agent for the benefit of the Banks, a security interest in all funds held in the
Cash Collateral Account from time to time and all proceeds thereof, as security
for the payment of the Obligations, including without limitation all Letter of
Credit Obligations owing to any Issuing Bank or any other Bank due and to become
due from the Borrower to any Issuing Bank or any other Bank under this Agreement
in connection with the Letters of Credit.
(b) Application against Letter of Credit Obligations. The Administrative
------------------------------------------------
Agent may, at any time or from time to time apply funds then held in the Cash
Collateral Account to the payment of any Letter of Credit Obligations owing to
any Issuing Bank, in such order as the Administrative Agent may elect, as shall
have become or shall become due and payable by the Borrower to any Issuing Bank
under this Agreement in connection with the Letters of Credit.
(c) Duty of Care. The Administrative Agent shall exercise reasonable care in
------------
the custody and preservation of any funds held in the Cash Collateral Account
and shall be deemed to have exercised such care if such funds are accorded
treatment substantially equivalent to that which the Administrative Agent
accords its own property, it being understood that the Administrative Agent
shall not have any responsibility for taking any necessary steps to preserve
rights against any parties with respect to any such funds.
Section 7.05 Non-exclusivity of Remedies. No remedy conferred upon the
---------------------------
Administrative Agent or the Banks is intended to be exclusive of any other
remedy, and each remedy shall be cumulative of all other remedies existing by
contract, at law, in equity, by statute or otherwise.
Section 7.06 Right of Set-off. Upon (a) the occurrence and during the
----------------
continuance of any Event of Default and (b) the making of the request or the
granting of the consent, if any, specified by Section 7.02 to authorize the
Administrative Agent to declare the Notes and any other amount payable hereunder
due and payable pursuant to the provisions of Section 7.02 or the automatic
acceleration of the Notes and all amounts payable under this Agreement pursuant
to Section 7.03, each Bank is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Bank to or for the credit
or the account of the Borrower against any and all of the obligations of the
Borrower now or hereafter existing under this Agreement, the Note held by such
Bank, and the other Credit Documents, irrespective of whether or not such Bank
shall have made any demand under this Agreement, such Note, or such other Credit
Documents, and although such obligations may be unmatured. Each Bank agrees to
promptly notify the Borrower after any such set-off and application
-103-
made by such Bank, provided that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Bank
under this Section are in addition to any other rights and remedies (including,
without limitation, other rights of set-off) which such Bank may have.
ARTICLE VIII
AGENCY AND ISSUING BANK PROVISIONS
Section 8.01 Authorization and Action. Each Bank hereby appoints and
------------------------
authorizes the Agents to take such action as Agent on its behalf and to exercise
such powers under this Agreement and the other Credit Documents as are delegated
to the Agents by the terms hereof and of the other Credit Documents, together
with such powers as are reasonably incidental thereto. As to any matters not
expressly provided for by this Agreement or any other Credit Document
(including, without limitation, enforcement or collection of the Notes), the
Agents shall not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully protected
in so acting or refraining from acting) upon the instructions of the Majority
Banks, and such instructions shall be binding upon all Banks and all holders of
Notes; provided, however, that neither Agent shall be required to take any
--------
action which exposes such Agent to personal liability or which is contrary to
this Agreement, any other Credit Document, or applicable law. The functions of
the Agents are administerial in nature and in no event shall the Agents have a
fiduciary or trustee relation in respect of any Bank by reason of this Agreement
or any other Credit Document.
Section 8.02 Agents' Reliance, Etc. Neither the Agents nor any of their
---------------------
respective directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken (including such Person's own negligence) by
it or them under or in connection with this Agreement or the other Credit
Documents, except for its or their own gross negligence or willful misconduct.
Without limitation of the generality of the foregoing, each Agent: (a) may
treat the payee of any Note as the holder thereof until such Agent receives
written notice of the assignment or transfer thereof signed by such payee and in
form satisfactory to the Administrative Agent; (b) may consult with legal
counsel (including counsel for the Borrower), independent public accountants and
other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts; (c) makes no warranty or representation to any
Bank and shall not be responsible to any Bank for any statements, warranties or
representations made in or in connection with this Agreement or the other Credit
Documents; (d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement or any other Credit Document on the part of the Borrower or its
Subsidiaries or to inspect the property (including the books and records) of the
Borrower or its Subsidiaries; (e) shall not be responsible to any Bank for the
due execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other Credit
-104-
Document; and (f) shall incur no liability under or in respect of this Agreement
or any other Credit Document by acting upon any notice, consent, certificate or
other instrument or writing (which may be by telecopier, telegram, cable or
telex) believed by it to be genuine and signed or sent by the proper party or
parties.
Section 8.03 Each Agent and Its Affiliates. With respect to its
-----------------------------
Commitment, the Advances made by it and the Notes issued to it, each Agent shall
have the same rights and powers under this Agreement as any other Bank and may
exercise the same as though it were not an Agent. The term "Bank" or "Banks"
shall, unless otherwise expressly indicated, include each Agent in its
individual capacity. Each Agent and its Affiliates may accept deposits from,
lend money to, act as trustee under indentures of, and generally engage in any
kind of business with, the Borrower or any of its Subsidiaries, and any Person
who may do business with or own securities of the Borrower or any such
Subsidiary, all as if such Agent were not an Agent hereunder and without any
duty to account therefor to the Banks.
Section 8.04 Bank Credit Decision. Each Bank acknowledges that it has,
--------------------
independently and without reliance upon either Agent or any other Bank and based
on the financial statements referred to in Section 4.06 and such other documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Bank also acknowledges that it
will, independently and without reliance upon either Agent or any other Bank and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement.
Section 8.05 Indemnification. The Banks severally agree to indemnify each
---------------
Agent and each Issuing Bank (to the extent not reimbursed by the Borrower),
according to their respective Pro Rata Shares from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against such Agent or such Issuing Bank in
any way relating to or arising out of this Agreement or any action taken or
omitted by such Agent or such Issuing Bank under this Agreement or any other
Credit Document (including such Agent's or such Issuing Bank's own negligence),
provided that no Bank shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from such Agent's or such Issuing Bank's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Bank agrees to reimburse each Agent promptly upon demand for its Pro Rata
Share of any out-of-pocket expenses (including counsel fees) incurred by such
Agent in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement or any other Credit Document, to the
extent that such Agent is not reimbursed for such expenses by the Borrower.
-105-
Section 8.06 Successor Agent and Issuing Banks. Either Agent or any
---------------------------------
Issuing Bank may resign at any time by giving written notice thereof to the
Banks and the Borrower and may be removed at any time with or without cause by
the Majority Banks upon receipt of written notice from the Majority Banks to
such effect. Upon receipt of notice of any such resignation or removal, the
Majority Banks shall have the right to appoint a successor Agent or Issuing
Bank. If no successor Agent or Issuing Bank shall have been so appointed, and
shall have accepted such appointment, within 30 days after the retiring Agent's
or Issuing Bank's giving of notice of resignation or the Majority Banks' removal
of the retiring Agent or Issuing Bank, then the retiring Agent or Issuing Bank
may, on behalf of the Banks and the Borrower, appoint a successor Agent or
Issuing Bank, which shall be a commercial bank meeting the financial
requirements of an Eligible Assignee and, in the case of an Issuing Bank, a
Bank. Upon the acceptance of any appointment as Agent or Issuing Bank by a
successor Agent or Issuing Bank, such successor Agent or Issuing Bank shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent or Issuing Bank, and the retiring Agent or
Issuing Bank shall be discharged from its duties and obligations under this
Agreement and the other Credit Documents, except that the retiring Issuing Bank
shall remain an Issuing Bank with respect to any Letters of Credit issued by
such Issuing Bank and outstanding on the effective date of its resignation or
removal and the provisions affecting such Issuing Bank with respect to such
Letters of Credit shall inure to the benefit of the retiring Issuing Bank until
the termination of all such Letters of Credit. After any retiring Agent's or
Issuing Bank's resignation or removal hereunder as Structuring Agent,
Administrative Agent or Issuing Bank, the provisions of this Article VIII shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was such Agent or Issuing Bank under this Agreement and the other Credit
Documents.
ARTICLE IX
MISCELLANEOUS
Section 9.01 Amendments, Etc. No amendment or waiver of any provision of
---------------
this Agreement, the Notes, or any other Credit Document, nor consent to any
departure by the Borrower or any Guarantor therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Structuring
Agent, the Administrative Agent or the Agents, as specified in the particular
provisions of the Credit Documents, and the Borrower, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no amendment shall increase the
--------
Commitment of any Bank without the written consent of such Bank, and no
amendment, waiver or consent shall, unless in writing and signed by all the
Banks, do any of the following: (a) increase the aggregate Commitments of the
Banks, (b) reduce the principal of, or interest on, the Notes or any fees or
other amounts payable hereunder
-106-
or under any other Credit Document, (c) postpone any date fixed for any payment
of principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, (d) change the number of Banks which shall be required for the Banks
or any of them to take any action hereunder or under any other Credit Document,
(e) amend this Section 9.01, (f) release any Guarantor from its obligations
under any of the Guaranties (provided that the Administrative Agent can release
any Supplemental Guarantor from its obligations under any of the Supplemental
Guaranties), (g) release any Person from its obligations under any or the
Environmental Indemnities, (h) release any Lien in favor of the Administrative
Agent for the benefit of the Banks on Property of the Borrower or Guarantors or
the Participating Lessee, except as contemplated by the Security Documents or
this Agreement, (i) amend the definition of "Majority Banks", (j) increases the
maximum duration of Interest Periods permitted under this Agreement, (k) waives
any covenant prohibiting a second Lien on any Property, (l) amends the
definition of "Borrowing Base or any component of "Borrowing Base"; and
provided, further, that (A) no amendment, waiver or consent shall, unless in
--------
writing and signed by the Structuring Agent, the Administrative Agent, or any
Issuing Bank in addition to the Banks required above to take such action, affect
the rights or duties of the Structuring Agent, the Administrative Agent, or such
Issuing Bank, as the case may be, under this Agreement or any other Credit
Document, and (B) no waiver or consent to departure from any of the conditions
specified in Section 3.01 or 3.02 or 3.03 or 3.04 shall be effective unless in
writing and signed by the Majority Banks and the Agents. In addition, no
Majority Bank Decision (as hereinafter defined) shall be made without the
written consent of the Majority Banks. "Majority Bank Decision" shall mean:
(a) any waiver for more than 30 days of, or any material amendment to,
of the reporting requirements set forth in clauses (a)-(e) or (g) of
Section 5.05 of this Agreement;
(b) any material waiver of, or any material amendment to, the provisions
related to the Cash Management Systems contained in Section 5.12 of this
Agreement;
(c) any determination to make a Borrowing after the occurrence and
during the continuance of an Event of Default;
(d) any waiver of the provisions of the Manager Consent that require
Management Agreements to be subordinate to the Lien of the Mortgages and
terminable upon the conditions specified in the Manager Consent;
(e) any consent pursuant to Section 6.02 of this Agreement to any
additional Indebtedness of the Borrower or any Subsidiary of the Borrower;
-107-
(f) any waiver for a period of more than 60 days of, or any material
amendment to, the financial covenants contained in Sections 6.15, 6.16 or
6.17 of this Agreement;
(g) any material waiver of, or any material amendment to, Section 6.05
of this Agreement to permit a fundamental change of the Borrower or any
Subsidiary of the Borrower;
(h) any approval pursuant to subsection 3.04(i) of this Agreement of a
Future Property as a possible Eligible Property;
(i) any material waiver of the conditions to a Hotel Property qualifying
as either an Eligible Property or a Permitted Non-Eligible Property;
(j) any amendment, supplement or modification to, or waiver of, the
provisions of Section 7.01 of this Agreement;
(k) any determination to send notice to the Borrower of, or otherwise
declare, an Event of Default pursuant to Section 7.01 of this Agreement;
(l) any determination to accelerate the Obligations pursuant to Section
7.02 of this Agreement;
(m) any determination to foreclose on, or exercise remedies in order to
realize upon, any Property after an Event of Default pursuant to any Credit
Document, provided, however, that if an Event of Default has occurred and
is continuing and the Majority Banks cannot agree on a course of action
within 60 days following the occurrence of such Event of Default, the
Administrative Agent shall commence exercising remedies against the
Property securing the Obligations;
(n) any material decision regarding the operation, maintenance, sale or
other disposition of any Property after the foreclosure upon such Property,
provided that Administrative Agent shall be able to take any action it
determines necessary to preserve or maintain any such Property and provided
further that if the Majority Banks cannot agree on the sale or disposition
of such Property, the Administrative Agent shall not sell or dispose of
such Property, but shall continue to hold such Property for the benefit of
the Banks;
(o) any decision regarding a new or substitute Manager or Franchisor or
new or substitute Management Agreement, Franchise Agreement, Ground Lease
or Participating Lease, or any other material decision regarding a
Management Agreement, Franchise Agreement, Ground Lease or Participating
Lease; and
-108-
(p) any modification of any of the following definitions of this
Agreement: "Debt Service Rate", "Pool Requirements" or "Refund Amount".
Section 9.02 Notices, Etc. All notices and other communications shall be
------------
in writing (including telecopy or telex) and mailed, telecopied, telexed, hand
delivered or delivered by a nationally recognized overnight courier, if to the
Borrower, at its address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇; if to any Bank at its Domestic Lending
Office specified opposite its name on Schedule 9.02; if to the Structuring
Agent, at its address at 4900 ▇▇▇▇▇▇▇▇ ▇▇▇▇ Center, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. Day, Vice President (telecopy: (214) 979-
2727; telephone: (▇▇▇) ▇▇▇-▇▇▇▇); if to Bank One, Texas, N.A., in its capacity
as Administrative Agent or an Issuing Bank, at its office at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: Commercial Real Estate Department -
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President (telecopy: (▇▇▇) ▇▇▇-▇▇▇▇; telephone: (214) 290-
2385); or, as to each party, at such other address or teletransmission number as
shall be designated by such party in a written notice to the other parties. All
such notices and communications shall, when mailed, telecopied, telexed or hand
delivered or delivered by overnight courier, be effective three days after
deposited in the mails, when telecopy transmission is completed, when confirmed
by telex answer-back or when delivered, respectively, except that notices and
communications to the Administrative Agent pursuant to Article II or Article
VIII shall not be effective until received by the Administrative Agent.
Section 9.03 No Waiver; Remedies. No failure on the part of any Bank, any
-------------------
Agent, or any Issuing Bank to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies provided in
this Agreement and the other Credit Documents are cumulative and not exclusive
of any remedies provided by law.
Section 9.04 Costs and Expenses. The Borrower agrees to pay on demand all
------------------
out-of-pocket costs and expenses of the Agents in connection with the
preparation, execution, delivery, administration, modification and amendment of
this Agreement, the Notes and the other Credit Documents and syndication
(syndication costs shall not exceed $5,000 per Eligible Assignee) of the
Obligations including, without limitation, (a) the reasonable fees and out-of-
pocket expenses of ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, L.L.P., counsel for the Structuring
Agent, and, with respect to advising either Agent as to its rights and
responsibilities under this Agreement, the Agents (such counsel's fees shall no
longer be capped as initially provided in the Agents' Fee Letter), (b) the
reasonable fees and out-of-pocket expenses of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.C.,
counsel for the Administrative Agent, and (c) all reasonable out-of-pocket costs
and expenses, if any, of each Agent, each Issuing Bank, and each Bank
(including, without limitation, reasonable counsel fees and expenses of each
Agent,
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such Issuing Bank, and each Bank) in connection with the enforcement (whether
through negotiations, legal proceedings or otherwise) of this Agreement and the
other Credit Documents, and (d) to the extent not included in the foregoing, the
costs of any local counsel, travel expenses, Appraisals, Engineering Reports,
Environmental Reports, Title Policies, mortgage and intangible taxes, costs of
recordation or filing of any Mortgage or Financing Statement or continuation
statement, and any related title or Uniform Commercial Code search conducted
subsequent to such recordation, any flood plain search costs, insurance
consultant costs and other costs usual and customary in connection with the
taking of a Lien on any of the Property.
Section 9.05 Binding Effect. This Agreement shall become effective when it
--------------
shall have been executed by the Borrower and the Agents, and when the
Structuring Agent shall have, as to each Bank, either received a counterpart
hereof executed by such Bank or been notified by such Bank that such Bank has
executed it and thereafter shall be binding upon and inure to the benefit of the
Borrower, each Agent, each Issuing Bank, and each Bank and their respective
successors and assigns, except that the Borrower shall not have the right to
assign its rights or delegate its duties under this Agreement or any interest in
this Agreement without the prior written consent of each Bank.
Section 9.06 Bank Assignments and Participations.
-----------------------------------
(a) Assignments. Any Bank may assign to one or more banks or other entities
-----------
all or any portion of its rights and obligations under this Agreement
(including, without limitation, all or a portion of its Commitment, the Advances
owing to it, the Notes held by it, and the participation interest in the Letter
of Credit Obligations held by it); provided, however, that (i) each such
-------- -------
assignment shall be of a constant, and not a varying, percentage of all of such
Bank's rights and obligations under this Agreement and shall involve a ratable
assignment of such Bank's Commitment and such Bank's Advances, (ii) the amount
of the resulting Commitment and Advances of the assigning Bank (unless it is
assigning all its Commitment) and the assignee Bank pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $10,000,000 and shall
be an integral multiple of $1,000,000, (iii) each such assignment shall be to an
Eligible Assignee, (iv) the parties to each such assignment shall execute and
deliver to the Administrative Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance, together with the Notes subject to such
assignment, and (v) each Eligible Assignee (other than the Eligible Assignee of
either Agent or an Eligible Assignee which is an Affiliate of the assigning
Bank) shall pay to the Administrative Agent a $2,500 administrative fee. Upon
such execution, delivery, acceptance and recording, from and after the effective
date specified in each Assignment and Acceptance, which effective date shall be
at least three Business Days after the execution thereof, (A) the assignee
thereunder shall be a party hereto for all purposes and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
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Assignment and Acceptance, have the rights and obligations of a Bank hereunder
and (B) such Bank thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or the remaining
portion of such Bank's rights and obligations under this Agreement, such Bank
shall cease to be a party hereto). Notwithstanding anything herein to the
contrary, any Bank may assign, as collateral or otherwise, any of its rights
under the Credit Documents to any Federal Reserve Bank.
(b) Term of Assignments. By executing and delivering an Assignment and
-------------------
Acceptance, the Bank thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such Bank makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency of
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such Bank makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
Guarantors or the performance or observance by the Borrower or the Guarantors of
any of their obligations under this Agreement or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.05 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon either Agent, such Bank or any other
Bank and based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (v) such assignee appoints and authorizes each
Agent to take such action as agent on its behalf and to exercise such powers
under this Agreement as are delegated to such Agent by the terms hereof,
together with such powers as are reasonably incidental thereto; and (vi) such
assignee agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Bank.
(c) The Register. The Administrative Agent shall maintain at its address
------------
referred to in Section 9.02 a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names and
addresses of the Banks and the Commitments of, and principal amount of the
Advances owing to, each Bank from time to time (the "Register"). The entries in
the Register shall be conclusive and binding for all purposes, absent manifest
error, and the Borrower, each Agent, the Issuing Banks, and the Banks may treat
each Person whose name is recorded in the Register as a Bank hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower or any Bank at any reasonable time and from time to time upon
reasonable prior notice.
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(d) Procedures. Upon its receipt of an Assignment and Acceptance executed by
----------
a Bank and an Eligible Assignee, together with the Note subject to such
assignment, the Administrative Agent shall, if such Assignment and Acceptance
has been completed and is in substantially the form of the attached Exhibit B,
(i) accept such Assignment and Acceptance, (ii) record the information contained
therein in the Register, and (iii) give prompt notice thereof to the Borrower.
Within five Business Days after its receipt of such notice, the Borrower, at its
own expense, shall execute and deliver to the Administrative Agent in exchange
for the surrendered Note, a new Note payable to the order of such Eligible
Assignee in amount equal to, respectively, the Commitment and the outstanding
Advances assumed by it pursuant to such Assignment and Acceptance, and if the
assigning Bank has retained any Commitment hereunder, a new Note payable to the
order of such Bank in an amount equal to, respectively, the Commitment and the
outstanding Advances retained by it hereunder. Such new Note shall be dated the
effective date of such Assignment and Acceptance and shall otherwise be in
substantially the form of the attached Exhibit A.
(e) Participations. Each Bank may sell participations to one or more banks
--------------
or other entities in or to all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its
Commitment, the Advances owing to it, its participation interest in the Letter
of Credit Obligations, and the Notes held by it); provided, however, that (i)
-------- -------
such Bank's obligations under this Agreement (including, without limitation, its
Commitment to the Borrower hereunder) shall remain unchanged, (ii) such Bank
shall remain solely responsible to the other parties hereto for the performance
of such obligations, (iii) such Bank shall remain the holder of any such Note
for all purposes of this Agreement, (iv) the Borrower, each Agent, and the
Issuing Banks and the other Banks shall continue to deal solely and directly
with such Bank in connection with such Bank's rights and obligations under this
Agreement, (v) such Bank shall not require the participant's consent to any
matter under this Agreement, except for change in the principal amount of any
Note in which the participant has an interest, reductions in fees or interest,
or extending the Maturity Date except as permitted in this Agreement, and (vi)
such Bank shall give prompt notice to the Borrower of each such participation
sold by such Bank. The Borrower hereby agrees that participants shall have the
same rights under Sections 2.08, 2.09, 2.11(c), and 9.07 hereof as the Bank to
the extent of their respective participations.
(f) Confidentiality. Each Bank may furnish any information concerning the
---------------
Borrower and its Subsidiaries in the possession of such Bank from time to time
to assignees and participants (including prospective assignees and
participants); provided that, prior to any such disclosure, the assignee or
--------
participant or proposed assignee or participant shall agree in writing to
preserve the confidentiality of any confidential information relating to the
Borrower and its Subsidiaries received by it from such Bank. Such Bank shall
promptly deliver a signed copy of any such confidentiality agreement to the
Borrower.
-112-
Section 9.07 Indemnification. The Borrower shall indemnify each Agent, the
---------------
Banks (including any lender which was a Bank hereunder prior to any full
assignment of its Commitment), the Issuing Banks, and each affiliate thereof and
their respective directors, officers, employees and agents from, and discharge,
release, and hold each of them harmless against, any and all losses,
liabilities, claims or damages to which any of them may become subject, insofar
as such losses, liabilities, claims or damages arise out of or result from (i)
any actual or proposed use by the Borrower or any Affiliate of the Borrower of
the proceeds of any Advance, (ii) any breach by the Borrower or any Guarantor of
any provision of this Agreement or any other Credit Document, (iii) any
investigation, litigation or other proceeding (including any threatened
investigation or proceeding) relating to the foregoing, or (iv) any
Environmental Claim or requirement of Environmental Laws concerning or relating
to the present or previously-owned or operated properties, or the operations or
business, of the Borrower or any of its Subsidiaries, and the Borrower shall
reimburse each Agent, each Issuing Bank, and each Bank, and each affiliate
thereof and their respective directors, officers, employees and agents, upon
demand for any reasonable out-of-pocket expenses (including legal fees) incurred
in connection with any such investigation, litigation or other proceeding; and
expressly including any such losses, liabilities, claims, damages, or expense
incurred by reason of the Person being indemnified's own negligence, but
excluding any such losses, liabilities, claims, damages or expenses incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified.
THE BORROWER ACKNOWLEDGES AND AGREES THAT CERTAIN OF ITS OBLIGATIONS AND
INDEMNITIES UNDER THIS AGREEMENT INCLUDE ANY CLAIMS RESULTING FROM THE
NEGLIGENCE OR ALLEGED NEGLIGENCE OF THE STRUCTURING AGENT, THE ADMINISTRATIVE
AGENT, THE BANKS, OR ANY OTHER PERSON BEING INDEMNIFIED.
Section 9.08 Execution in Counterparts. This Agreement may be executed in
-------------------------
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Section 9.09 Survival of Representations, Indemnifications, etc. All
--------------------------------------------------
representations, warranties contained in this Agreement or made in writing by or
on behalf of the Borrower in connection herewith shall survive the execution and
delivery of this Agreement and the Credit Documents, the making of the Advances
and any investigation made by or on behalf of the Banks, none of which
investigations shall diminish any Bank's right to rely on such representations
and warranties. All obligations of the Borrower provided for in Sections 2.08,
2.09, 2.11(c), 8.05 and 9.07 shall survive any termination of this Agreement and
repayment in full of the Obligations.
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Section 9.10 Severability. In case one or more provisions of this
------------
Agreement or the other Credit Documents shall be invalid, illegal or
unenforceable in any respect under any applicable law, the validity, legality
and enforceability of the remaining provisions contained herein or therein shall
not be affected or impaired thereby.
Section 9.11 Business Loans. The Borrower warrants and represents that the
--------------
Advances evidenced by the Notes are and shall be for business, commercial,
investment or other similar purposes and not primarily for personal, family,
household or agricultural use, as such terms are used in Chapter One ("Chapter
One") of the Texas Credit Code. At all such times, if any, as Chapter One shall
establish a Maximum Rate, the Maximum Rate shall be the "indicated rate ceiling"
(as such term is defined in Chapter One) from time to time in effect.
Section 9.12 Usury Not Intended. It is the intent of the Borrower and each
------------------
Bank in the execution and performance of this Agreement and the other Credit
Documents to contract in strict compliance with applicable usury laws, including
conflicts of law concepts, governing the Advances of each Bank including such
applicable laws of the State of Texas and the United States of America from time
to time in effect. In furtherance thereof, the Banks and the Borrower stipulate
and agree that none of the terms and provisions contained in this Agreement or
the other Credit Documents shall ever be construed to create a contract to pay,
as consideration for the use, forbearance or detention of money, interest at a
rate in excess of the Maximum Rate and that for purposes hereof "interest" shall
include the aggregate of all charges which constitute interest under such laws
that are contracted for, charged or received under this Agreement; and in the
event that, notwithstanding the foregoing, under any circumstances the aggregate
amounts taken, reserved, charged, received or paid on the Advances, include
amounts which by applicable law are deemed interest which would exceed the
Maximum Rate, then such excess shall be deemed to be a mistake and each Bank
receiving same shall credit the same on the principal of its Notes (or if such
Notes shall have been paid in full, refund said excess to the Borrower). In the
event that the maturity of the Notes is accelerated by reason of any election of
the holder thereof resulting from any Event of Default under this Agreement or
otherwise, or in the event of any required or permitted prepayment, then such
consideration that constitutes interest may never include more than the Maximum
Rate and excess interest, if any, provided for in this Agreement or otherwise
shall be canceled automatically as of the date of such acceleration or
prepayment and, if theretofore paid, shall be credited on the applicable Notes
(or, if the applicable Notes shall have been paid in full, refunded to the
Borrower). The provisions of this Section shall control over all other
provisions of this Agreement or the other Credit Documents which may be in
apparent conflict herewith.
Section 9.13 Governing Law. This Agreement, the Notes and the other Credit
-------------
Documents shall be governed by, and construed and enforced in accordance with,
the laws of the State of Texas.
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Section 9.14 Consent to Jurisdiction. The Borrower hereby irrevocably
-----------------------
submits to the jurisdiction of any Texas state or federal court sitting in
Dallas, Texas in any action or proceeding arising out of or relating to this
Agreement, the Notes and the other Credit Documents, and the Borrower hereby
irrevocably agrees that all claims in respect of such action or proceeding may
be heard and determined in such court. The Borrower hereby irrevocably waives,
to the fullest extent it may effectively do so, any right it may have to the
defense of an inconvenient forum to the maintenance of such action or
proceeding. The Borrower hereby agrees that service of copies of the summons
and complaint and any other process which may be served in any such action or
proceeding may be made by mailing or delivering a copy of such process to the
Borrower at its address specified in Section 9.02. The Borrower agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Section shall affect the rights of any Bank,
the Structuring Agent, or the Administrative Agent to serve legal process in any
other manner permitted by the law or affect the right of any Bank, the
Structuring Agent or the Administrative Agent to bring any action or proceeding
against the Borrower or its Property in the courts of any other jurisdiction.
Section 9.15 Knowledge of Borrower. For purposes of this Agreement,
---------------------
"knowledge of the Borrower" means the actual knowledge of any of the executive
officers and all other Responsible Officers of the Parent or the general manager
of each Hotel Property.
Section 9.16 Banks Not in Control. None of the covenants or other
--------------------
provisions contained in the Credit Documents shall or shall be deemed to, give
the Banks the rights or power to exercise control over the affairs and/or
management of the Borrower, any of its Subsidiaries or any Guarantor, the power
of the Banks being limited to the right to exercise the remedies provided in the
Credit Documents; provided, however, that if any Bank becomes the owner of any
stock, or other equity interest in, any Person whether through foreclosure or
otherwise, such Bank shall be entitled (subject to requirements of law) to
exercise such legal rights as it may have by being owner of such stock, or other
equity interest in, such Person.
Section 9.17 Headings Descriptive. The headings of the several Sections
--------------------
and paragraphs of the Agreement are inserted for convenience only and shall not
in any way affect the meaning or construction of any provision of this
Agreement.
Section 9.18 Time is of the Essence. Time is of the essence under the
----------------------
Credit Documents.
SECTION 9.19 WAIVERS OF JURY TRIAL. THE BORROWER, THE AGENTS AND THE BANKS
---------------------
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL
PROCEEDING RELATING TO THIS AGREEMENT OR THE
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NOTES OR ANY OTHER CREDIT DOCUMENT OR TO ANY COUNTERCLAIM THEREIN.
SECTION 9.20 ENTIRE AGREEMENT. PURSUANT TO SECTION 26.02 OF THE TEXAS
----------------
BUSINESS AND COMMERCE CODE, A LOAN AGREEMENT IN WHICH THE AMOUNT INVOLVED IN THE
LOAN AGREEMENT EXCEEDS $50,000 IN VALUE IS NOT ENFORCEABLE UNLESS THE LOAN
AGREEMENT IS IN WRITING AND SIGNED BY THE PARTY TO BE BOUND OR THAT PARTY'S
AUTHORIZED REPRESENTATIVE.
THE RIGHTS AND OBLIGATIONS OF THE PARTIES TO AN AGREEMENT SUBJECT TO THE
PRECEDING PARAGRAPH SHALL BE DETERMINED SOLELY FROM THE WRITTEN LOAN AGREEMENT,
AND ANY PRIOR ORAL AGREEMENTS BETWEEN THE PARTIES ARE SUPERSEDED BY AND MERGED
INTO THE LOAN AGREEMENT. THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS, AS
DEFINED IN THIS AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES.
THE BORROWER ACKNOWLEDGES AND AGREES THAT CERTAIN OF ITS OBLIGATIONS AND
INDEMNITIES UNDER THIS AGREEMENT INCLUDE ANY CLAIMS RESULTING FROM THE
NEGLIGENCE OR ALLEGED NEGLIGENCE OF THE STRUCTURING AGENT, THE ADMINISTRATIVE
AGENT, THE BANKS, OR ANY OTHER PERSON BEING INDEMNIFIED.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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EXECUTED as of the date first referenced above.
BORROWER:
--------
AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P.
By: AGH GP, Inc., its general partner
By:______________________________
Name:____________________________
Title:___________________________
ADMINISTRATIVE AGENT:
--------------------
BANK ONE, TEXAS, N.A.
______________________________________
By:___________________________________
Title:________________________________
STRUCTURING AGENT:
-----------------
SOCIETE GENERALE,
SOUTHWEST AGENCY
______________________________________
By:___________________________________
Title:________________________________
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BANKS:
-----
SOCIETE GENERALE,
SOUTHWEST AGENCY
______________________________________
By:___________________________________
Title:________________________________
BANK ONE, TEXAS, N.A.
______________________________________
By:___________________________________
Title:________________________________
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SCHEDULE 5.10
INSURANCE
A. INSURANCE.
---------
1. POLICIES REQUIRED. While any obligation of the Borrower or any
-----------------
Guarantor under any Credit Document remains outstanding, the Borrower shall
procure and maintain or shall cause to be procured and maintained continuously
in effect policies of insurance in form and amounts and issued by companies,
associations or organizations licensed to do business in the states the Hotel
Properties are located, with a Best's Rating of no less than A, XI and otherwise
satisfactory to the Agents covering such casualties, risks, perils, liabilities
and other hazards required by Agents. All original policies, or certificates
thereof, and endorsements and renewals thereof shall be delivered to and
retained by the Administrative Agent unless the Administrative Agent waives this
requirement in writing. All policies shall expressly protect or recognize
Administrative Agent's interest as required by the Administrative Agent.
Without limiting the generality of the foregoing, the Borrower shall provide or
cause to be provided the following types of insurance coverage:
(a) until repayment of the Notes and satisfaction of all
obligations under the Credit Documents: (i) property insurance on an "all
risks" full replacement cost basis without deduction for depreciation (or
fire, extended coverage and difference in conditions basis), including
flood, earthquake and sinkhole coverages in an amount equal to the
replacement cost of the Improvements (except for earthquake insurance which
for each Eligible Property and Permitted Non-Eligible Property shall be in
an amount which is equal to or greater than the greater of (A) 50% of the
Real Estate Value of such Hotel Property or (b) the Allocated Debt Amount
for such Hotel Property), naming the Administrative Agent in its capacity
as administrative agent, as mortgagee under a standard form mortgagee
clause; (ii) Comprehensive General Liability Insurance (including
contractual liability, owners and contractors protective coverages,
products & completed operations, personal & advertising injury liability,
fire damage legal liability and alienated premises coverage) and
Comprehensive Auto Liability Insurance in a minimum amount of $50,000,000
each occurrence; (iii) Statutory Workers' Compensation and Employer's
Liability Insurance in the minimum amounts of $1,000,000 each accident,
$1,000,000 each employee - disease, $1,000,000 policy limit - disease; and
(iv) Rent loss insurance against loss of income by reason of any hazard
covered under the insurance required under this subparagraph (a) in an
amount sufficient to avoid any co-insurance penalty, but in any event for
not less than two (2) years gross receipts from all sources of income from
the Hotel Property. Each such policy of property insurance shall contain a
replacement cost endorsement and such other endorsements as are sufficient
to prevent the Borrower, the Agents
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and/or the Borrower's Subsidiaries from becoming a co-insurer with respect
to such buildings and improvements.
(b) During the renovation of any Hotel Property the Borrower will
additionally provide: (i) Builder's Risk Insurance on an "all risks" basis
including flood, earthquake (in the amount stated in clause (a)) and
sinkhole coverages, and also including Stored Materials and materials while
in transit, naming the Administrative Agent as mortgagee under a standard
form mortgagee clause, and (ii) Statutory Workers' Compensation and
Employer's Liability Insurance in the minimum amounts of $1,000,000 each
accident, $1,000,000 each employee - disease, $1,000,000 policy limit -
disease, covering each contractor and all other contractors or
subcontractors who may have occasion to be at the job site.
(c) Such additional insurance as may be reasonably required by the
Administrative Agent from time to time in the event that any Hotel Property
is exposed to hazards and risks with respect to which the Administrative
Agent deems the existing insurance inadequate to properly protect its
interests.
All policies of insurance shall either have attached thereto a lender's
loss payable endorsement for the benefit of the Administrative Agent as loss
payee, in form satisfactory to the Agents or shall name the Agents, the Banks
and their respective directors, officers, representatives, agents and employees
(the "Banks' Parties") as additional insureds, as applicable. The Borrower
shall furnish the Administrative Agent with a certified copy of an original or a
certificate of insurance of all policies of insurance required. All policies or
certificates, as the case may be, of insurance shall set forth the coverage, the
limits of liability, the name of the carrier, the policy number, the Best's
Rating of the carrier and the period of coverage. In addition, all policies of
insurance required under the terms hereof shall contain an endorsement or
agreement by the insurer that any loss shall be payable in accordance with the
terms of such policy notwithstanding any act or negligence of the Borrower, the
Participating Lessee, the Manager or any party holding under any such Person
which might otherwise result in a forfeiture of said insurance and the further
agreement of the insurer waiving all rights of setoff, counterclaim or
deductions against the Borrower. At least 15 days prior to the expiration of
each required policy, the Borrower shall deliver to the Administrative Agent
evidence of the renewal or replacement of such policy, continuing such insurance
in the form as required by this Agreement. All such policies shall contain a
provision that notwithstanding any contrary agreement between the Borrower and
the applicable insurance company, such policies will not be canceled, allowed to
lapse without renewal, surrendered or amended (which provision shall include any
reduction in the scope or limits of coverage) without at least 15 days' prior
written notice to the Administrative Agent.
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EXHIBIT A
FORM OF NOTE
$ __________ __________ 19__
For value received, the undersigned American General Hospitality
Operating Partnership L.P., a Delaware limited partnership ("Borrower"), hereby
promises to pay to the order of _____________________ ("Bank") the principal
amount of ____________________ and ____/100 Dollars ($_____) or, if less, the
aggregate outstanding principal amount of each Advance (as defined in the Credit
Agreement referred to below) made by the Bank to the Borrower, together with
interest on the unpaid principal amount of each such Advance from the date of
such Advance until such principal amount is paid in full, at such interest
rates, and at such times, as are specified in the Credit Agreement.
The Note is one of the Notes referred to in, and is entitled to the
benefits of, and is subject to the terms of, the Credit Agreement dated as of
July 31, 1996 (as the same may be amended or modified from time to time, the
"Credit Agreement"), among the Borrower, the Banks, Societe Generale, Southwest
Agency, as Structuring Agent, and Bank One, Texas, N.A., as Administrative
Agent. Capitalized terms used in this Note that are defined in the Credit
Agreement and not otherwise defined in this Note have the meanings assigned to
such terms in the Credit Agreement. The Credit Agreement, among other things,
(a) provides for the making of Advances by the Bank to the Borrower from time to
time in an aggregate amount not to exceed at any time outstanding the Dollar
amount first above mentioned, the indebtedness of the Borrower resulting form
each such Advance being evidenced by this Note and (b) contains provisions for
acceleration of the maturity of this Note upon the happening of certain events
stated in the Credit Agreement and for prepayments of principal prior to the
maturity of this Note upon the terms and conditions specified in the Credit
Agreement.
Both principal and interest are payable in lawful money of the United
States of America to the Administrative Agent at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ Real Estate Lending, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (or at such other location
or address as may be specified by the Administrative Agent to the Borrower) in
same day funds. The Bank shall record all Advances and payments of principal
made under this Note, but no failure of the Bank to make such recordings shall
affect the Borrower's repayment obligations under this Note.
Except as specifically provided in the Credit Agreement, the Borrower
hereby waives presentment, demand, protest, notice of intent to accelerate,
notice of acceleration, and any other notice of any kind. No failure to
exercise, and no delay in exercising, any rights hereunder on the part of the
holder of this Note shall operate as a waiver of such rights
This Note shall be governed by, and construed and enforced in accordance
with, the laws of the state of Texas (except that Tex. Rev. Civ. Stat. ▇▇▇. Art.
▇▇▇▇, ▇▇. 15, which regulates certain revolving credit loan accounts shall not
apply to this Note).
AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P.
By: AGH GP, Inc., its general partner
By:_______________________________
Name:_______________________
Title:______________________
-2-
EXHIBIT _
ASSIGNMENT AND ACCEPTANCE
Dated ______________, 19__
Reference is made to the Credit Agreement dated as of _________, 1996 (as
the same may be amended or modified from time to time, the "Credit Agreement")
among American General Hospitality Operating Partnership, L.P., a Delaware
limited partnership (the "Borrower"), the Banks, Societe Generale, Southwest
Agency, as Structuring Agent, and Bank One, Texas, N.A., as Administrative
Agent. Capitalized terms not otherwise defined in this Assignment and Acceptance
shall have the meanings assigned to them in the Credit Agreement.
Pursuant to the terms of the Credit Agreement, _________________ wishes to
assign and delegate ___%/1/ of its rights and obligations under the Credit
Agreement. Therefore, ____________________ ("Assignor"), ________________
("Assignee"), and the Administrative Agent agree as follows:
1. As of the Effective Date (as defined below), the Assignor hereby sells
and assigns and delegates to the Assignee, and the Assignee hereby purchases and
assumes from the Assignor, without recourse to the Assignor and without
representation or warranty except for the representations and warranties
specifically set forth in clauses (i), (ii), and (iii) of Section 2, a ___%
interest in and to all of the Assignor's rights and obligations under the Credit
Agreement in connection with its Commitment, including, without limitation, such
percentage interest in the Assignor's Commitment and the Advances owing to the
Assignor, the participation interest in the Letter of Credit Obligations held by
the Assignor, the Note held by the Assignor, and the obligation to pay to the
Borrower the Refund Amount.
2. The Assignor (i) represents and warrants that, prior to executing this
Assignment and Acceptance, its Commitment is $__________, the aggregate
outstanding principal amount of Advances owed to it by the Borrower is
$________, its Pro Rata Share of the Letter of Credit Exposure is
$___________, and its Pro Rata Share of the Refund Amount is
$__________________; (ii) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (iii) makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties, or representations made in or in connection with the Credit
Agreement or any other Credit Document or the execution,
________________________
/1/ Specify percentage in no more than 5 decimal points.
legality, validity, enforceability, genuineness, sufficiency, or value of the
Credit Agreement or any other Credit Document or any other instrument or
document furnished pursuant thereto; (iv) makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower or any Guarantor or the performance or observance by the Borrower or
any Guarantor of any of its obligations under the Credit Agreement or any other
Credit Document or any other instrument or document furnished pursuant thereto;
and (v) attaches the Note referred to in paragraph 1 above and requests that the
Administrative Agent exchange such Note for a new Note dated __________, 19__ in
the principal amount of $_________________, payable to the order of the Assignee
[, and a new Note dated ______________, 19__ in the principal amount of
$___________, payable to the order of Assignor].
3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 4.06 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and without
reliance upon the Structuring Agent, the Administrative Agent, the Assignor, or
any other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement or any other Credit Document; (iii)
appoints and authorizes the Administrative Agent to take such action as
administrative agent on its behalf and to exercise such powers under the Credit
Agreement and any other Credit Document as are delegated to the Administrative
Agent by the terms thereof, together with such powers as are reasonably
incidental thereto; (iv) appoints and authorizes the Structuring Agent to take
such action as structuring agent on its behalf and to exercise such powers under
the Credit Agreement and any other Credit Document as are delegated to the
Structuring Agent by the terms thereof, together with such powers as are
reasonably incidental thereto; (v) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Credit
Agreement or any other Credit Document are required to be performed by it as a
Bank; (vi) specifies as its Domestic Lending Office (and address for notices)
and LIBOR Lending Office the offices set forth beneath its name on the signature
pages hereof; (vii) attaches the forms prescribed by the Internal Revenue
Service of the United States certifying as to the Assignee's status for purposes
of determining exemption from United States withholding taxes with respect to
all payments to be made to the Assignee under the Credit Agreement and its Note
or such other documents as are necessary
-2-
to indicate that all such payments are subject to such rates at a rate reduced
by an applicable tax treaty/2/, and (viii) represents that it is an Eligible
Assignee.
4. The effective date for this Assignment and Acceptance shall be
______________ (the "Effective Date")/3/ and following the execution of this
Assignment and Acceptance, the Administrative Agent will record it.
5. Upon such recording, and as of the Effective Date, (i) the Assignee
shall be a party to the Credit Agreement for all purposes, and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations of a
Bank thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights (other than rights against the
Borrower pursuant to Sections 2.09, 2.11(c) and 9.07 of the Credit Agreement,
which shall survive this assignment) and be released from its obligations under
the Credit Agreement.
6. Upon such recording, from and after the Effective Date, the
Administrative Agent shall make all payments under the Credit Agreement and the
Notes in respect of the interest assigned hereby (including, without limitation,
all payments of principal, interest, and commitment fees) to the Assignee. The
Assignor and Assignee shall make all appropriate adjustments in payments under
the Credit Agreement and the Notes for periods prior to the Effective Date
directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed and
enforced in accordance with, the laws of the State of Texas.
______________________
/2/ If the Assignee is organized under the laws of a jurisdiction outside the
United States.
/3/ See Section 9.06. Such date shall be at least three Business Days after
the execution of this Assignment and Acceptance.
-3-
The parties hereto have caused this Assignment and Acceptance to be duly
executed as of the date first above written.
[ASSIGNOR]
By:________________________________________
Name:____________________________________
Title:___________________________________
Address: _________________________________
_________________________________
_________________________________
Attention:_________________________________
Telecopy:__________________________________
Telephone:_________________________________
[ASSIGNEE]
By:________________________________________
Name:____________________________________
Title:___________________________________
Domestic Lending Office:
Address: _________________________________
______________________________________
Attention:_________________________________
Telecopy:__________________________________
Telephone:_________________________________
LIBOR Lending Office:
Address: _________________________________
______________________________________
Attention:_________________________________
Telecopy:__________________________________
Telephone:_________________________________
Bank One, Texas, N.A.,
as Administrative Agent
By:________________________________________
Name:______________________________
Title:_____________________________
Address: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
P.O. Box 655415
Commercial Real ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention:___________________________
Telecopy:____________________________
Telephone:___________________________
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THIS INSTRUMENT PREPARED BY,
AND WHEN RECORDED, RETURN TO:
Bracewell & ▇▇▇▇▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
ASSIGNMENT OF LEASES,
RENTS AND SECURITY DEPOSITS
---------------------------
THIS ASSIGNMENT OF LEASES, RENTS AND SECURITY DEPOSITS ("Assignment") dated
___________, 1996, is made by AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P., a Delaware limited partnership (the "Assignor") in favor of
BANK ONE, TEXAS, N.A., a national banking association, as administrative agent
(such administrative agent and any successor administrative agent shall be
referred to hereinafter as "Assignee"), and is executed concurrently with that
certain Credit Agreement of even date herewith (the "Credit Agreement") by and
among Assignor, Assignee, as the administrative agent, Societe Generale,
Southwest Agency, as the structuring agent and those other banks and lenders a
party thereto (collectively the "Banks") pursuant to which the Banks have agreed
to make a loan (the "Loan") to Assignor in the amount of $100,000,000.00,
subject to the terms and conditions set forth therein, and is one of the
Assignments of Leases described therein. All words and phrases used in this
Assignment with their initial letters capitalized shall have the meaning
assigned to them in the Credit Agreement, unless such words and phrases are
otherwise specifically defined herein.
1. ASSIGNMENT. For good and valuable consideration, the receipt and
----------
sufficiency of which is acknowledged, Assignor presently, absolutely,
irrevocably and unconditionally grants, sells, conveys, transfers, assigns and
delivers unto Assignee all the right, title and interest of Assignor in and to
the rents, issues, profits, revenues, royalties, rights and benefits
(hereinafter referred to as the "Rents") from all or any portion of the property
more fully described on Exhibit "A" attached hereto and made a part hereof for
all purposes and the improvements located or to be located thereon (hereinafter
referred to as the "Property"); and to that end Assignor presently, absolutely,
irrevocably
and unconditionally assigns and sets over to Assignee all of Assignor's right,
title and interest as "Landlord" or "Lessor" under all leases covering any
portion of said Property or the improvements located or to be located thereon,
whether now or hereafter made, executed or delivered, and whether written or
verbal, including without limitation that certain Participating Lease by and
between Assignor and AGH Leasing, L.P. dated as of __________, 1996 (which,
together with any and all leases of the Property or the improvements located or
to be located thereon which are entered into following the date hereof, shall be
referred to herein as the "Leases"), including all guaranties thereof and all
security deposits thereunder.
2. AUTHORIZATION TO COLLECT. Assignor authorizes and empowers Assignee to
------------------------
collect the Rents, including, without limitation, security deposits, as they
shall become due, and by this Assignment authorizes and directs each and all of
the tenants under any of the Leases to pay the Rents including, without
limitation, security deposits, as may now be due and shall hereafter become due,
to Assignee. It is understood and agreed, however, that except during the
existence of an Event of Default, Assignor shall have the revocable license to
collect the Rents and take all actions with respect to all Leases, present and
future, and Assignee shall refrain from exercising its rights hereunder subject
to the terms of this Assignment; but that such license to collect or continue
collecting as aforesaid by Assignor shall not operate to permit a collection by
Assignor of any installment of Rent more than one month in advance thereof
without the written consent of Assignee. For so long as Assignor's license to
collect such Rents remains in effect, Assignor shall apply all such Rents first
to the Notes and other indebtedness secured by that certain
[LEASEHOLD/SUBLEASEHOLD] Deed of Trust, Security Agreement, Assignment of Rents,
Fixture Filing and Financing Statement dated as of even date herewith executed
by Assignor (the "Deed of Trust") and Assignor's satisfaction and discharge of
all of their respective obligations pertaining to the Property under the Leases
and Loan Documents. Thereafter, Assignor may apply the balance of the Rents
collected by Assignor in any manner not inconsistent with the Loan Documents.
For purposes of this Assignment and the Deed of Trust, Rents shall be deemed
earned over the entire period to which they relate, and if Assignor has received
any Rents which are properly allocable to any period following a foreclosure of
the Property under the Loan Documents or transfer in lieu thereof, Assignor
shall pay the amount so allocable to the then owner of the Property immediately
upon demand. Upon or at any time after an Event of Default, the license granted
herein may be revoked by Assignee, and Assignee or a receiver may enter upon the
Property, and collect, retain and apply the Rents toward payment of the Notes
and other indebtedness secured by the Deed of Trust in such priority and
proportions as Assignee in its discretion shall elect. Assignor hereby consents
to the appointment of a receiver after the occurrence of an Event of Default if
Assignee believes it is necessary or desirable to enforce Assignee's rights
under this Assignment, the Credit Agreement or any other Loan Document and
Assignor waives notice of any application therefor.
3. NOTES: DEED OF TRUST. The term of this Assignment shall be until the
--------------------
Notes, together with all interest thereon, and all other indebtedness secured by
the Deed of Trust, shall have been
-2-
fully paid and satisfied. At the end of such term this Assignment is to be
canceled, released and reassigned to Assignor and any release of the Deed of
Trust in full shall automatically cancel, release, and reassign to Assignor all
interests conveyed herein.
4. NO PAYMENT OF RENT. Assignor covenants that at the time of the
------------------
execution and delivery of this Assignment there has been no prepayment of any
Rents by any tenant under any Lease for more than one month in advance.
5. LEASES. Assignor hereby represents and warrants that all of the
------
Leases existing as of the date hereof (the "Existing Leases") are in full force
and effect and that there are no defaults by any tenant under any of the
Existing Leases nor, to the knowledge of Assignor, by Assignor. Except as
otherwise expressly permitted in the Credit Agreement, Assignor hereby covenants
and agrees that Assignor will comply with all of the obligations of the
"Landlord" or "Lessor" under all of the Leases without relying on any grace
period provided therein; that Assignor will immediately furnish to Assignee
copies of all notices of default received from any tenant under any Lease; that
Assignee shall have the right, at Assignor's expense (but shall not be
obligated) to cure any default by Assignor under any Lease; that Assignor will
not, except as a result of a default thereunder, terminate any Lease; and that
Assignor will not decrease the rental rate, shorten the lease term or make any
material modification to any Lease.
6. MORTGAGEE IN POSSESSION. Nothing herein contained shall be construed
-----------------------
as making Assignee a mortgagee in possession or shall Assignee be liable for
laches, or failure to collect any Rents and it is understood that Assignee is
obligated to account to Assignor only for such sums as are actually collected by
Assignee.
7. NO WAIVER. It is understood and agreed that neither the existence of
---------
this Assignment nor the exercise of the privilege to collect Rents hereunder
including, without limitation, security deposits, shall be construed as a waiver
by the Assignee of the right to enforce payment of the Loan in strict accordance
with the terms and provisions of the Credit Agreement and by any means provided
in the Credit Agreement, and the rights hereby given are in addition to and
cumulative of all rights given by the Credit Agreement or any other Loan
Document.
8. SUCCESSORS AND ASSIGNS. The covenants and obligations herein
----------------------
undertaken by Assignor shall be binding upon the successors and assigns of
Assignor and the rights and benefits herein conferred upon Assignee shall inure
to the benefit of its successors and assigns.
9. NOTICES. Unless expressly provided otherwise in this Assignment, all
-------
notices, demands, approvals and other communications provided for in this
Assignment shall be in writing and shall be delivered to the addresses set forth
in, and in accordance with, the Deed of Trust.
-3-
10. FURTHER ASSURANCES. Until the indebtedness evidenced by the Notes and
------------------
secured by the Deed of Trust is paid in full, Assignor covenants and agrees upon
demand to confirm to Assignee the assignment contained herein of any and all
Leases entered into following the date hereof and the Rents relating thereto,
and to make, execute and deliver to Assignee upon demand any and all instruments
that may be necessary or desirable therefor, but the terms and provisions of
this Assignment shall apply to any such subsequent Lease, whether or not such
assignment is so confirmed.
11. CHOICE OF LAW. To the extent, and only to the extent, that an
-------------
election of the laws of a forum other than California would be ineffective under
California law, the validity, construction, and enforcement of this instrument
shall be governed by the laws of the State of California applicable to contracts
executed and performed entirely within that state with respect to real estate
remedies, perfection and other matters so inherently local that an election of
the laws of a forum other than California would be ineffective under California
law. In all other respects, including, but not limited to, matters of usury law
and general contract law applicable to agreements between lenders and borrowers,
the validity, construction and enforcement hereof shall be determined according
to the substantive laws (but not the conflicts laws) of the State of Texas, in
which state the Assignee and the Banks originated the Said Indebtedness and in
which state the Notes are payable.
IN WITNESS WHEREOF, Assignor has executed this assignment as of the date
first set forth above.
ASSIGNOR:
AMERICAN GENERAL
HOSPITALITY OPERATING
PARTNERSHIP, L.P., a
Delaware limited partnership
By: AGH GP, Inc., a Nevada corporation
By:___________________________________
Name:_________________________________
Title:________________________________
-4-
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
================================================================================
STATE OF _______________
COUNTY OF ______________
On ____________________ before me, ____________________________________________,
Date NAME, TITLE OF OFFICER-E.G. "▇▇▇▇ ▇▇▇,
NOTARY PUBLIC"
personally appeared ____________________________________________________________
_______ personally known to me - OR - _______ proved to me on the basis of
satisfactory evidence to be 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 OF NOTARY
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons
relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
____ INDIVIDUAL
____ CORPORATE OFFICER
___________________________________ ___________________________________
TITLE(S) TITLE OR TYPE OF DOCUMENT
____ PARTNER(S) ____ LIMITED
____ GENERAL
___________________________________
____ ATTORNEY-IN-FACT NUMBER OF PAGES
____ TRUSTEE(S)
____ GUARDIAN/CONSERVATOR
____ OTHER:________________________ ___________________________________
_____________________________ DATE OF DOCUMENT
_____________________________
SIGNER IS REPRESENTING:
================================================================================
-5-
EXHIBIT "A"
PROPERTY DESCRIPTION
(DUPLICATE ONLY)
FORM OF ASSIGNMENT OF LEASES,
RENTS AND SECURITY DEPOSITS
---------------------------
THE STATE OF _______ (S)
(S)
COUNTY OF _________ (S)
THIS ASSIGNMENT OF LEASES, RENTS AND SECURITY DEPOSITS ("Assignment") dated
______________, 1996 is made by AGH LEASING, L.P., a Delaware limited
partnership (the "Assignor") in favor of [________________________, a
_____________________] [AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP,
L.P., A DELAWARE LIMITED PARTNERSHIP] (the "Assignee"), its landlord pursuant to
that certain Lease Agreement dated as of even date herewith (the "Lease
Agreement"). Assignor is making this Assignment as a condition precedent to and
security for its obligations under the Lease Agreement.
1. ASSIGNMENT. For good and valuable consideration, the receipt and
----------
sufficiency of which is acknowledged, Assignor presently, absolutely,
irrevocably and unconditionally conveys, transfers, assigns and delivers unto
Assignee all the right, title and interest of Assignor in and to the rents,
issues, profits, revenues, royalties, rights and benefits (hereinafter referred
to as the "Rents") from all or any portion of the property more fully described
on Exhibit "A" attached hereto and made a part hereof for all purposes and the
improvements located or to be located thereon (hereinafter referred to as the
"Property"); and to that end Assignor presently, absolutely, irrevocably and
unconditionally assigns and sets over to Assignee all of Assignor's right, title
and interest as "Landlord", "Lessor" or "Sublessor" under all leases covering
any portion of said Property or the improvements located or to be located
thereon, whether now or hereafter made, executed or delivered, and whether
written or verbal (which, together with any and all leases of the Property or
the improvements located or to be located thereon which are entered into
following the date hereof, shall be referred to herein as the "Leases"),
including all guaranties thereof and all security deposits thereunder.
2. AUTHORIZATION TO COLLECT. Assignor authorizes and empowers Assignee to
------------------------
collect the Rents, including, without limitation, security deposits, as they
shall become due, and by this Assignment authorizes and directs each and all of
the tenants under any of the Leases to pay the Rents including, without
limitation, security deposits, as may now be due and shall hereafter become due,
to Assignee. It is understood and agreed, however, that except during the
existence of a default beyond applicable notice and cure period by Assignor
under the Lease Agreement (an "Event of Default"), Assignor shall have the
revocable license to collect the Rents and take all actions with respect to all
Leases, present and future, and Assignee shall refrain from exercising its
rights hereunder subject to the terms of this Assignment; but that such license
to collect or continue collecting as aforesaid by Assignor shall not operate to
permit a collection by Assignor of any
installment of Rent more than one month in advance thereof without the written
consent of Assignee. For so long as Assignor's license to collect such Rents
remains in effect, Assignor shall apply all such Rents first to its obligations
under the Lease Agreement. Thereafter, Assignor may apply the balance of the
Rents collected by Assignor in any manner not inconsistent with the Lease
Agreement. For purposes of this Assignment and the Lease Agreement, Rents shall
be deemed carried over the entire period to which they relate, and if Assignor
has received any Rents which are properly allocable to any period following
termination of the Lease Agreement, Assignor shall pay the amount so allocable
to the Assignee immediately upon demand. Upon or at any time after an Event of
Default, the license granted herein may be revoked by Assignee, and Assignee may
enter upon the Property, and collect, retain and apply the Rents toward payment
of the Assignor's obligations under the Lease Agreement.
3. SURVIVAL. The provisions of this Assignment shall survive any
--------
termination of the Lease Agreement.
4. NO PAYMENT OF RENT. Assignor covenants that at the time of the
------------------
execution and delivery of this Assignment there has been no prepayment of any
Rents by any tenant under any Lease for more than one month in advance.
5. LEASES. Assignor hereby represents and warrants that all of the Leases
------
existing as of the date hereof (the "Existing Leases") are in full force and
effect and that to the best of its knowledge there are no defaults by any tenant
under any of the Existing Leases nor, to the knowledge of Assignor, by Assignor.
Assignor hereby represents, warrants and covenants that no prior assignment of
the property assigned by Assignor under this Assignment has occurred and that
except for this Assignment no such assignment will occur prior to the expiration
of the Lease Agreement. Assignor hereby covenants and agrees that Assignor will
comply with all of the obligations of the "Landlord", "Lessor" or "Sublessor"
under all of the Leases without relying on any grace period provided therein;
that Assignor will immediately furnish to Assignee copies of all notices of
default received from any tenant under any Lease; that Assignee shall have the
right, at Assignor's expense (but shall not be obligated) after sending Assignor
notice thereof and ten days to perform same to cure any default by Assignor
under any Lease; that Assignor will not, except as a result of a default
thereunder, terminate any Lease; and that Assignor will not decrease the rental
rate, shorten the lease term or make any material modification to any Lease.
6. MORTGAGEE IN POSSESSION. Nothing herein contained shall be construed
-----------------------
as making Assignee a mortgagee in possession nor shall Assignee be liable for
laches, or failure to collect any Rents and it is understood that Assignee is
obligated to account to Assignor only for such sums as are actually collected by
Assignee.
7. NO WAIVER. It is understood and agreed that neither the existence of
---------
this Assignment nor the exercise of the privilege to collect Rents hereunder
including, without limitation, security
-2-
deposits, shall be construed as a waiver by the Assignee of the right to
enforce payments of the sums due any payable pursuant to the Lease Agreement in
strict accordance with the terms and provisions thereof and by any means
provided therein.
8. SUCCESSORS AND ASSIGNS. The covenants and obligations herein
----------------------
undertaken by Assignor shall be binding upon the successors and assigns of
Assignor and the rights and benefits herein conferred upon Assignee shall inure
to the benefit of its successors and assigns. Assignee may collaterally assign
this Assignment and its rights, in whole or in part, under this Assignment as
collateral for any credit facility secured in whole or in part, under this
Assignment as collateral for any credit facility secured in whole or in part by
the Property, and Assignor hereby irrevocably consents and agrees to the same.
Upon such collateral assignment: (i) this Assignment shall inure to the benefit
of the lender or lenders providing such credit facility, and upon Assignor's
receipt of the address(es) of such lender or lenders, Assignor shall send lender
or lenders a copy of any notices sent by Assignor to Assignee under this
Assignment, and such lender or lenders shall have the right, but not the
obligation, to take any action of Assignee under this Assignment, and (ii) no
consent on behalf of Assignee or amendment, modification or termination of this
Assignment shall be effective or binding without the written consent of such
lender or lenders and all such actions taken without such lender or lenders
consent shall be void.
9. NOTICES. Unless expressly provided otherwise in this Assignment, all
-------
notices, demands, approvals and other communications provided for in this
Assignment shall be in writing and shall be delivered to the addresses set forth
in, and in accordance with, the Lease Agreement.
10. FURTHER ASSURANCES. Assignor covenants and agrees upon demand to
------------------
confirm to Assignee the assignment contained herein of any and all Leases
entered into following the date hereof and the Rents relating thereto, and to
make, execute and deliver to Assignee upon demand any and all instruments that
may be necessary or desirable therefor, but the terms and provisions of this
Assignment shall apply to any such subsequent Lease, whether or not such
assignment is so confirmed.
-3-
IN WITNESS WHEREOF, Assignor has executed this assignment as of the date
first set forth above.
ASSIGNOR:
AGH LEASING, L.P., a Delaware limited partnership
By: AGHL GP, INC., a Delaware corporation.
its sole general partner
By:_________________________________________
Name:_______________________________________
Title:______________________________________
[ADD APPROPRIATE FORM OF ACKNOWLEDGMENT]
-4-
EXHIBIT "A"
PROPERTY DESCRIPTION
BANK ONE, TEXAS, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
July 31, ▇▇▇▇
▇▇▇▇ ▇▇▇, ▇▇▇▇▇, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Commercial Real Estate Lending
Re: Concentration Bank Account No. 1892347897
Operating Account (Borrower) No. 1822924542
CapEx Reserve Account No. 1892347905
Certain accounts described on Schedule A (Other Accounts)
---------------------------------------------------------
Ladies and Gentlemen:
This letter agreement (this "Agreement") will confirm our arrangements
---------
regarding (i) Account No. 1892347897 (the "Concentration Bank Account"), which
--------------------------
Bank One, Texas N.A. (the "Bank") maintains in the name of Bank One, Texas,
----
N.A., as Administrative Agent for the Banks (in such capacity, the "Secured
-------
Party") under that certain Credit Agreement dated July 30, 1996, as amended from
-----
time to time, by and among American General Hospitality Operating Partnership,
L.P. ("Borrower"), Societe Generale, as structuring agent, the lenders named
--------
therein and the Secured Party (the "Credit Agreement") for the account of and at
----------------
the request of Borrower, (ii) Account No. 1892347905 (the "CapEx Reserve
-------------
Account"), an interest bearing account which the Bank maintains in the name of
-------
the Secured Party for the account of and at the request of the Borrower, (iii)
Account No. 1822924542 (the "Operating Account") which the Bank maintains in the
-----------------
name "American General Hospitality Operating Partnership, L.P. - Operating
Account", and (iv) the accounts set forth on Schedule A attached hereto (the
----------
"Other Accounts") which the Bank maintains for the account of and at the request
--------------
of the Borrower and/or the Guarantors (except for the Parent) (herein, the
"Subsidiary Guarantors"). All interest accruing in respect of funds on deposit
---------------------
in the CapEx Reserve Account shall be applied to the balance on deposit in said
account. The Concentration Bank Account, the CapEx Reserve Account, the
Operating Account and the Other Accounts are referred to herein, collectively,
as the "Accounts"). Capitalized terms
--------
CASH MANAGEMENT AGREEMENT - Page 1 of 14
-------------------------
used herein without definition shall have the meaning ascribed to such terms in
the Credit Agreement.
Pursuant to that certain Security Agreement (as amended, restated,
supplemented or otherwise modified from time to time, the "Security Agreement"),
------------------
dated as of July 31, 1996, by and among the Borrower, the Subsidiary Guarantors,
and the Secured Party, the Secured Party has been assigned and granted a
security interest in all of Borrower's and Subsidiary Guarantor's right, title
and interest in and to all funds, and any investments of and earnings of said
funds, now or hereafter held by the Bank in the Accounts.
The Secured Party, the Borrower and the Subsidiary Guarantors hereby direct
the Bank as follows:
(i) the Bank will not permit the withdrawal of any funds from the
Concentration Bank Account and the CapEx Reserve Account by the
Borrower; and
(ii) upon the written request of the Secured Party following the
occurrence of an Event of Default under the Credit Agreement, the
Bank will transfer funds on deposit in the Concentration Bank
Account (subject to the availability of funds then on deposit in the
Concentration Bank Account) to the Secured Party for application to
any amounts then outstanding under the Credit Agreement; or
(iii) so long as the Bank has not received prior written notice from the
Secured Party of the occurrence of either an Event of Default or a
Bankruptcy Event (as hereinafter defined), upon receipt by the Bank
of a request from the Secured Party (which shall specify the
Accounts to which funds shall be transferred), the Bank will
transfer funds on deposit in the Concentration Bank Account (in the
amount specified in such request, subject to the availability of
funds then on deposit in the Concentration Bank Account) to the
Operating Account or to any of the Other Accounts;
(iv) upon receipt by the Bank of written or tested telex request from the
Borrower (1) the Bank will invest in the Secured Party's name funds
held in the Concentration Bank Account as Liquid Investments (as
defined in the Credit Agreement) as may be specified in said
instructions, and/or (2) the Bank will sell any such Liquid
Investments whether at maturity or prior thereto as may be specified
in the Borrower's request;
CASH MANAGEMENT AGREEMENT - Page 2 of 14
-------------------------
(v) upon receipt by the Bank of a written request from the Secured Party
to transfer funds on deposit in the CapEx Reserve Account to the
Operating Account, the Bank will transfer funds (in the amount
specified in such request, subject to the availability of funds then
on deposit in the CapEx Reserve Account) to the Operating Account or
such other Account, subject to the terms of the Credit Agreement;
and
(vi) so long as the Bank has not received prior written notice from the
Secured Party of the occurrence of an Event of Default or a
Bankruptcy Event, the Borrower and the Subsidiary Guarantors shall
have the right, subject to their respective interests in such
Accounts, to withdraw funds from the Operating Account and the Other
Accounts, provided, however, that after receipt of such notice by
-------- -------
the Bank, the Bank will not permit the Borrower or the Subsidiary
Guarantors to withdraw funds from the Operating Account or the Other
Accounts and any funds on deposit in, or payable with respect to,
the Operating Account or the Other Accounts shall thereafter be due
and payable to the Secured Party.
As used herein, the term "Bankruptcy Event" shall mean and refer to the
----------------
occurrence of one or more of the following events: any one of the Borrower or
the Subsidiary Guarantors (A) executes an assignment for the benefit of
creditors, or takes any action in furtherance thereof; (B) admits in writing its
inability to pay, or fails to pay, its debts generally as they become due; (C)
as a debtor, files a petition, case, proceeding or other action pursuant to, or
voluntarily seeks the benefit of any applicable laws pertaining to liquidation,
bankruptcy, insolvency, reorganization, receivership, or similar laws, domestic
or foreign, affecting the rights or remedies of creditors generally, in effect
from time to time (collectively, "Debtor Relief Law"), or takes any action in
-----------------
furtherance thereof; (D) seeks the appointment of a receiver, trustee, custodian
or liquidator of any part of the Eligible Property or of any significant portion
of its other property; or (E) suffers the filing of a petition, case, proceeding
or other action against it as a debtor under any Debtor Relief Law or seeking
appointment of a receiver, trustee, custodian or liquidator of any part of the
Eligible Property or of any significant portion of its other property.
The directions set forth above may not be rescinded, amended or modified
without the written consent of the Secured Party.
By its execution below, the Borrower and the Subsidiary Guarantors hereby
(i) irrevocably direct the Bank to follow any instructions (including, without
limitation, any requests for withdrawals, transfers, investments, sale of
investments or requests for information) with respect to the Accounts and any
funds from time to time held therein, that the Bank may receive from the
CASH MANAGEMENT AGREEMENT _ Page 3 of 14
-------------------------
Secured Party in accordance with this Agreement, (ii) agree that any funds that
are received by the Borrower or the Subsidiary Guarantors from the Operating
Account and the Other Accounts on or after the occurrence of an Event of Default
or a Bankruptcy Event shall be held IN TRUST for the benefit of the Secured
Party and immediately delivered to the Secured Party or immediately paid into
the Operating Account, and (iii) acknowledge and agree that neither the Borrower
nor any of the Subsidiary Guarantors shall have the right to withdraw funds from
or close the CapEx Reserve Account or the Concentration Bank Account or give any
instructions with respect thereto (other than the rights of Borrower in respect
of investment instructions and directions to the Secured Party) and, following
the occurrence of an Event of Default or a Bankruptcy Event, neither Borrower
nor any of the Subsidiary Guarantors shall have the right to withdraw funds from
the Operating Account or the Other Accounts, all such rights being expressly
reserved for the Secured Party, and for purposes of following any instructions
of the Secured Party, the Bank shall treat the Secured Party as if it were sole
owner of such Accounts and the funds from time to time held therein, without
regard to any interests the Borrower or the Subsidiary Guarantors may have
therein. Without limiting any of the foregoing, the Borrower and the Subsidiary
Guarantors hereby acknowledge and agree that all fees, expenses and other costs
in connection with the Accounts shall be for the sole account of the Borrower
and/or the Subsidiary Guarantors or as may otherwise be agreed to by the Bank,
the Borrower and the Subsidiary Guarantors.
Notwithstanding any instructions to the contrary from the Secured Party to
the Bank, the Bank may charge back the Accounts for any customary and usual
service charges and any credit given for any items which are returned unpaid for
any reason and for related account adjustments, and if the funds in the Accounts
have been charged and are insufficient to compensate the Bank, then the Bank
shall be entitled to offset the aggregate amounts owed to the Bank against any
funds subsequently deposited in the Accounts.
The Bank may rely upon any instructions given to it in writing by any
person purporting to be a vice president of the Secured Party or by any other
officer of the Secured Party designated by a person purporting to be a vice
president of the Secured Party in a writing delivered to the Bank.
At the end of each month the Bank shall furnish its regular statements
covering the deposits to and withdrawals from the Concentration Bank Account and
the CapEx Reserve Account to the Secured Party, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, Commercial Real Estate Lending.
The Borrower and the Subsidiary Guarantors hereby agree that they will,
jointly and severally, indemnify and hold harmless the Bank from and against any
and all liabilities,
CASH MANAGEMENT AGREEMENT - Page 4 of 14
-------------------------
obligations, claims, suits, judgments, actions, losses, costs and expenses
(including reasonable attorneys' fees) arising out of or relating to this
Agreement or the Accounts (except those arising from the gross negligence or
willful misconduct of the Bank).
The Bank may terminate this letter only upon 30 days' prior written notice
to that effect to the Borrower, the Subsidiary Guarantors and the Secured Party:
To Borrower and the Subsidiary Guarantors at:
American General Hospitality
Operating Partnership, L.P.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
To the Secured Party at:
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Commercial Real Estate Lending
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
This Agreement may be terminated upon 30 days' prior written notice to the Bank
by the Secured Party stating that the security interest of the Secured Party in
the Accounts has been released.
This Agreement shall become effective upon its execution by all parties
hereto and shall then be binding upon the parties hereto and their respective
successors and assigns. This Agreement may be executed by one or more of the
parties hereto in any number of counterparts, each of which when so executed
shall be an original, but all such counterparts together shall constitute but
one and the same instrument. This Agreement may not be amended except in writing
and signed by each of the Secured Party, the Borrower, the Subsidiary
Guarantors and the Bank. To the extent that any other agreement between the
Bank, the Borrower and the Subsidiary Guarantors contradicts the terms of this
Agreement, the terms of this Agreement shall govern. This Agreement supersedes
all previous agreements between the Borrower, the Subsidiary
CASH MANAGEMENT AGREEMENT - Page 5 of 14
-------------------------
Guarantors and the Bank, whether written or oral, and contains the entire
understanding between the Borrower, the Subsidiary Guarantors and the Bank with
respect to the subject matter hereof.
Notwithstanding that the Bank may have knowledge of, or be a party to, any
other agreement between the Secured Party and the Borrower and the Subsidiary
Guarantors, including the Credit Agreement, the Secured Party hereby agrees that
the Bank shall have no duty independently to determine whether or not any
request or instruction made hereunder by the Borrower or the Subsidiary
Guarantors is valid or permissible under the Credit Documents, or otherwise.
The Secured Party further acknowledges and agrees that the Bank, in the
performance of its obligations hereunder, shall only be obligated to exercise
reasonable diligence, and shall be liable only for losses, or other costs or
expenses to the Secured Party or others (including attorneys' fees), if (i) such
losses, cost or expenses arise out of or relate to the requests and instructions
of the Secured Party hereunder and (ii) are caused by the willful misconduct or
gross negligence of the Bank.
This Agreement shall be governed and construed in accordance with the
substantive laws of the State of Texas.
BANK ONE, TEXAS, N.A.
as the Secured Party
By: ______________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
ACKNOWLEDGED AND AGREED
this 31st day of July, ▇▇▇▇
▇▇▇▇ ▇▇▇, ▇▇▇▇▇, N.A.
as Cash Manager
By: ______________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
CASH MANAGEMENT AGREEMENT - Page 6 of 14
-------------------------
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership
By: AGH GP, Inc., a Nevada corporation,
its general partner
By:____________________
Name:__________________
Title:_________________
CASH MANAGEMENT AGREEMENT - Page 7 of 14
-------------------------
3100 GLENDALE JOINT VENTURE,
an Ohio general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:_______________________
Name:_____________________
Title:____________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc., its general
partner
By:_______________________
Name:_____________________
Title:____________________
By: American General Hospitality Operating
Partnership, L.P., its partner
By: AGH GP, Inc., general partner
By:_______________________
Name:_____________________
Title:____________________
CASH MANAGEMENT AGREEMENT - Page 8 of 14
-------------------------
MDV LIMITED PARTNERSHIP,
a Texas limited partnership
By: AGH UPREIT LLC, its general
partner
By: American General Hospitality
Corporation, member
By:_________________________
Name:_______________________
Title:______________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:_________________________
Name:_______________________
Title:______________________
CASH MANAGEMENT AGREEMENT - Page 9 of 14
-------------------------
MADISON MOTEL ASSOCIATES,
a Wisconsin general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:_________________________
Name:_______________________
Title:______________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc., its
general partner
By:_________________________
Name:_______________________
Title:______________________
By: American General Hospitality Operating
Partnership, L.P., its partner
By: AGH GP, Inc., general partner
By:____________________
Name:__________________
Title:_________________
CASH MANAGEMENT AGREEMENT - Page 10 of 14
-------------------------
183 HOTEL ASSOCIATES, LTD.,
a Texas limited partnership
By: AGH UPREIT LLC, its general
partner
By: American General Hospitality
Corporation, member
By:_________________________
Name:_______________________
Title:______________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:_________________________
Name:_______________________
Title:______________________
CASH MANAGEMENT AGREEMENT - Page 11 of 14
-------------------------
RICHMOND WILLIAMSBURG
ASSOCIATES, LTD., a Texas limited
partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:___________________________
Name:_________________________
Title:________________________
By: American General Hospitality
Operating Partnership, L.P.,
member
By: AGH GP, Inc.,
general partner
By:___________________________
Name:_________________________
Title:________________________
CASH MANAGEMENT AGREEMENT - Page 12 of 14
-------------------------
2929 ▇▇▇▇▇▇▇▇ LIMITED LIABILITY
COMPANY, a Delaware limited liability
company
By: AGH UPREIT, LLC, its member
By: American General Hospitality
Corporation, member
By:_______________________________
Name:_____________________________
Title:____________________________
By: American General Hospitality
Operating Partnership, L.P.,
member
By: AGH GP, Inc., general
partner
By:_______________________________
Name:_____________________________
Title:____________________________
By: American General Hospitality Operating
Partnership, L.P., its member
By: AGH GP, Inc., general partner
By:_______________________________
Name:_____________________________
Title:____________________________
CASH MANAGEMENT AGREEMENT - Page 13 of 14
-------------------------
AGH UPREIT, LLC, a Delaware limited liability
company
By: American General Hospitality Corporation,
member
By:_________________________
Name:_______________________
Title:______________________
CASH MANAGEMENT AGREEMENT - Page 14 of 14
-------------------------
Schedule A
----------
LIST OF OTHER ACCOUNTS
----------------------
================================================================================
ACCOUNT NAME ACCOUNT NO.
================================================================================
AGH UPREIT LLC 1822924625
--------------------------------------------------------------------------------
3100 Glendale Joint Venture 1822924641
Hilton Hotel and Conference Center, Toledo, OH
--------------------------------------------------------------------------------
MDV Limited Partnership 1822924658
Hotel Maison de Ville, New Orleans, LA
--------------------------------------------------------------------------------
Madison Motel Associates 1822924666
Holiday Inn Select, Madison, WI
--------------------------------------------------------------------------------
183 Hotel Associates, Ltd. 1822924674
Holiday Inn DFW Airport West
--------------------------------------------------------------------------------
Richmond Williamsburg Associates, Ltd. 1822924682
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇
--------------------------------------------------------------------------------
2929 ▇▇▇▇▇▇▇▇ Limited Liability Company 1822924732
Holiday Inn New Orleans Airport, LA
================================================================================
CASH MANAGEMENT AGREEMENT -- Schedule A
-------------------------
EXHIBIT __
BORROWER FUNDING CERTIFICATE
JULY 31, 1996
Bank One, Texas, N.A.,
as Administrative Agent under the Credit Agreement herein described
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 4th Floor
Commercial Real Estate Lending
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
Ladies and Gentlemen:
The undersigned, American General Hospitality Operating Partnership, L.P., a
Delaware limited partnership (the "Borrower"), refers to the Credit Agreement
dated as of July 13, 1996 (as the same may be amended or modified from time to
time, the "Credit Agreement," the defined terms of which are used in this
Borrower Funding Certificate unless otherwise defined in this Borrower Funding
Certificate) among the Borrower, the Banks, the Agent, the Structuring Agent and
the Administrative Agent, and hereby gives you irrevocable notice pursuant to
Section 3.03(a) of the Credit Agreement that the undersigned hereby requests the
initial Borrowing, and in connection with that request acknowledges and agrees
that all Credit Documents, if any, held in escrow are hereby released from such
escrow.
The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the initial Borrowing;
(a) the representations and warranties contained in the Credit Agreement
and the other Security Documents are correct in all material respects,
before and after giving effect to the Proposed Borrowing and the
application of the proceeds therefrom, as though made on the date of the
Proposed Borrowing; and
Bank One, Texas, N.A.
[Date]
Page 2
(b) no Default has occurred and remains uncured, or would result from such
Proposed Borrowing or from the application of the proceeds therefrom.
Very truly yours,
AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P.
By: AGH GP, Inc., its general partner
By:________________________________
Name:______________________________
Title:_____________________________
EXHIBIT ___
BORROWING BASE CERTIFICATE
This Borrowing Base Certificate is executed this ___ day of _____________,
1996 and is prepared pursuant to Section 2.14 of that certain Credit Agreement
(the "Agreement") between AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP,
L.P., a Delaware limited partnership (the "Borrower"), SOCIETE GENERALE,
SOUTHWEST AGENCY, as Structuring Agent, BANK ONE, TEXAS, N.A., as Administrative
Agent, and the Banks parties to the Credit Agreement. Capitalized terms used
herein but not otherwise defined herein shall have the meanings specified by the
Agreement:
1. Aggregate Real Estate Value of all Eligible Properties $________
2. Line 1 above multiplied by 40% $________
3. The combined trailing twelve months Borrowing Base EBITDA
generated by the Eligible Properties $________
4. Line 3 above multiplied by five (5) $________
5. BORROWING BASE
(Lesser of Lines 2 and 4) $________
The Borrower has caused this Borrowing Base Certificate to be executed this
____ day of ______________, 199_.
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P.
By: AGH GP, Inc., its general
partner
By:___________________________
Name:_________________________
Title:________________________
BORROWING BASE CERTIFICATE
--------------------------------------------------------------------------------------------------------------------
Real Estate Value
Hotel Propertis Owned by the Parent Appraised (Lesser of Cost Basis Trailing 12-Month
or Parent's Subsidiaries Cost Basis Value or Appraised Value) Property EBITDA
--------------------------------------------------------------------------------------------------------------------
ELIGIBLE PROPERTIES
--------------------------------------------------------------------------------------------------------------------
1. Holiday Inn, ▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇
--------------------------------------------------------------------------------------------------------------------
2. ▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇
--------------------------------------------------------------------------------------------------------------------
3. Hilton Hotel, Toledo, OH
--------------------------------------------------------------------------------------------------------------------
4. Holiday Inn-N.O. Airport,
(Holiday Inn Select
Conversion), Kenner, LA
--------------------------------------------------------------------------------------------------------------------
5. Holiday Inn Select,
(Crowne Plaza Conversion),
Madison, WI
--------------------------------------------------------------------------------------------------------------------
6. Holiday Inn (Crowne Plaza
Conversion), San Jose, CA
--------------------------------------------------------------------------------------------------------------------
7. Best Western,
Albuquerque, NM
--------------------------------------------------------------------------------------------------------------------
8. Hotel Maison de Ville,
New Orleans, LA
--------------------------------------------------------------------------------------------------------------------
9. Days Inn, Ocean City, MD
--------------------------------------------------------------------------------------------------------------------
10. Holiday Inn, Mission
Valley, San Diego, CA
--------------------------------------------------------------------------------------------------------------------
11. ▇▇ ▇▇▇▇▇ Airport Hotel,
San Jose, CA
--------------------------------------------------------------------------------------------------------------------
(Combined 12-Month
(Eligible Properties Borrowing Base
Aggregate Real Estate EBITDA for Eligible
Value) Properties)
$________(1) X 40%=(2) $________(3) X 5=(4)
--------------------------------------------------------------------------------------------------------------------
-2-
FORM OF
Recording Requested By And
When Recorded Mail to:
Bracewell & ▇▇▇▇▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
THE STATE OF __________ (S)
(S)
COUNTY OF _____________ (S)
COLLATERAL ASSIGNMENT AND SECURITY AGREEMENT
This Collateral Assignment and Security Agreement dated as of July _____,
1996 (as may be hereafter amended or otherwise modified from time to time, this
"Assignment") is between ______________________, a [Delaware] limited
partnership ("Debtor") having an office and mailing address at ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇ ▇▇▇▇ in favor
of BANK ONE, TEXAS, N.A., a national banking association, as administrative
agent ("Secured Party") for the Banks (as hereinafter defined), having an office
and mailing address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 4th Floor, Commercial Real ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice
President.
WITNESSETH:
WHEREAS, [AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., A
DELAWARE LIMITED PARTNERSHIP ("BORROWER"), WHICH IS THE DIRECT OR INDIRECT OWNER
OF DEBTOR] [DEBTOR], Secured Party, as Administrative Agent, Societe Generale,
Southwest Agency, as Structuring Agent, and the banks and other lenders party
thereto (collectively the "Banks") have entered into a Credit Agreement dated as
of _________, 1996 (as amended or otherwise modified from time to time, the
"Credit Agreement"); and
WHEREAS, the [BORROWER/DEBTOR] has executed promissory notes of even date
with the Credit Agreement in favor of the Banks in the original aggregate
principal amount of $100,000,000.00 (the "Notes", which term includes any
modification, renewal, extension or alteration thereof); and
WHEREAS, the Notes were executed and delivered to Secured Party and the
Banks, and shall be due and payable in accordance with the Credit Agreement; and
WHEREAS, Debtor is leasing or subleasing the land described on Exhibit "A"
attached hereto and the improvements, equipment, fixtures, furniture and other
personal property located on such land (collectively, the "Hotel Property") to
AGH Leasing, L.P. (the "Lessee") under that certain lease executed between
Debtor and Lessee (the "Hotel Lease"); and
WHEREAS, the terms and provisions of the Notes and Credit Agreement are
incorporated herein by reference and made a part of this Assignment to the same
extent as though set forth in full herein; and
WHEREAS, as a condition to the acceptance of the Notes and the making of
the credit facility evidenced by the Credit Agreement (the "Credit Facility"),
Debtor agreed to execute and deliver this Assignment to secure the payment of
the indebtedness from time to time evidenced by the Notes, the payment of all
other sums now or hereafter owing by [BORROWER AND] Debtor and the other
Guarantors (all such Persons being collectively referred to herein as the
"Obligors") hereunder, under the Credit Agreement or under any other document or
instrument now or hereafter evidencing or securing the aforesaid indebtedness or
otherwise executed in connection herewith or therewith (this Assignment, the
Notes, the Credit Agreement and all other documents and instruments now or
hereafter evidencing or securing the aforesaid indebtedness or otherwise
executed in connection herewith or therewith, being hereinafter referred to
collectively as the "Credit Documents"), and the performance and observance of
all covenants, agreements, conditions and other provisions set forth herein, in
the Notes and in the Other Credit Documents;
NOW THEREFORE, and for in consideration of the sum of Ten and No/100
Dollars ($10.00) paid by Secured Party to Debtor and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Debtor and Secured Party hereby agree as follows:
1. Definitions. Unless otherwise defined in this Assignment, each
-----------
capitalized term shall have the meaning given to such term in the Note.
2. Assignment. To secure the payment of the indebtedness from time to
----------
time evidenced by the Notes, the payment of all other sums now or hereafter
owing by the Obligors hereunder, under the Credit Agreement or any other Credit
Document and the performance and observance of all covenants, agreements,
conditions and other provisions set forth herein, in the Notes, the Credit
Agreement or any other Credit Document (collectively the "Obligations"), and to
charge the properties, interests and rights hereinafter described with such
payment, performance and observance, Debtor hereby assigns as security to
Secured Party, and hereby grants to Secured Party, a continuing security
interest in the following and Debtor's right, title and interest in, to and
under the following, including without limitation all of Debtor's right, title
and interest, if any, in and to the real and
-2-
personal property serving as collateral under any of the following
(collectively, the "Collateral"):
a. the Assignment of Management Agreements executed by Lessee
to Lessor in connection with the Hotel Property;
b. the Assignment of Leases, Rents and Security Deposits
executed by Lessee to Lessor in connection with the Hotel Property;
c. the General Assignment and Agreement executed by Lessee to
Lessor in connection with the Hotel Property;
d. those instruction letters or agreements executed in
connection with Hotel Property pursuant to which upon the occurrence of
certain events certain depository institutions have agreed wire transfer
funds in various bank accounts of Lessee to a bank account at Secured Party
held in the name of the [BORROWER/DEBTOR];
e. those instruction letters or agreements executed in
connection with the Hotel Property pursuant to which certain credit card
companies have agreed to wire transfer funds owed Lessee into certain bank
accounts of Lessee;
f. any other agreements, pledges assignments or mortgages
pursuant to which Lessee's obligations to Lessor under the Hotel Lease are
secured; and
g. all amendments, modifications, replacements, products and
proceeds of the foregoing.
3. Power and Authority. Debtor has full power and authority to make
-------------------
this agreement.
4. Obligations and This Agreement. Debtor shall perform promptly all
------------------------------
agreements herein, in the Note, and in the other Credit Documents to which
Debtor is a party. Debtor agrees that any amounts paid to Secured Party pursuant
to this Agreement shall be applied in accordance with the provisions of the
Credit Agreement.
5. Ownership of Collateral. At the time Debtor assigns and grants to
-----------------------
Secured Party a security interest in any Collateral, Debtor shall be the
absolute owner thereof and shall have the right to assign and grant such
security interest. Debtor shall defend the Collateral against all claims and
demands of all persons at any time claiming any interest therein adverse to
Secured Party. Debtor shall keep the Collateral free from all liens and security
interests except those for taxes not yet due and the security interest hereby
created.
-3-
6. Delivery of Collateral. Debtor represents and warrants that Debtor has
----------------------
provided to Secured Party, a current, true and complete original of the
Collateral and shall continue to provide Secured Party a current, true and
complete original of any additional Collateral until Debtor satisfies the
Obligations in full, including without limitation any securities, cash, cash
equivalents or other personal property constituting Collateral delivered to
Debtor.
7. Events of Default. An "Event of Default" under the Credit Agreement
-----------------
shall be deemed an Event of Default hereunder ("Event of Default").
8. Remedies of Secured Party. When an Event of Default occurs, at any
-------------------------
time thereafter during the continuance of the Event of Default, Secured Party,
without notice, may take all actions permitted under the Credit Documents and
exercise any rights under the Uniform Commercial Code of the State of Texas (the
"Uniform Commercial Code"), rights and remedies of Secured Party under this
Agreement, or otherwise. Secured Party may require Debtor to assemble the
Collateral and make it available to Secured Party at a place which is reasonably
convenient to both parties. Unless the Collateral threatens to decline quickly
in value or is of a type customarily sold on a recognized market, Secured Party
will give Debtor reasonable notice of the time and place of any public sale
thereof or of the time after which any private sale or other intended
disposition thereof is to be made. Expenses of retaking, holding, preparing for
sale, selling, leasing or the like shall include Secured Party's reasonable
attorney's fees and legal expenses. Secured Party shall have the authority to
enter upon any premises upon which any of the same, or any Collateral, may be
situated and remove the same therefrom without liability. Debtor shall be
entitled to any surplus and shall be liable to Secured Party for any deficiency.
The proceeds of any disposition after default available to satisfy the
Obligations shall be applied to the Obligations in such order and in such manner
as Secured Party in its discretion shall decide. In addition, Debtor
acknowledges that during the continuance of a monetary Event of Default or
following a foreclosure or deed in lieu of foreclosure, pursuant to the
Manager's Consent Secured Party or any subsequent owner of any Hotel Property
shall have the continuing right to terminate the Management Agreement for the
Hotel Property upon no less than thirty (30) days prior written notice to
Manager without any obligation to pay a termination or cancellation fee or
penalty to Manger.
9. Attorney-in-Fact. Debtor hereby irrevocably appoints Secured Party,
----------------
and any officer or agent of Secured Party as Secured Party may select in its
sole discretion, as Debtor's true and lawful attorney-in-fact, with full power
of substitution (a) from and after the occurrence and during the continuance of
an Event of Default, to (i) endorse Debtor's name on all applications,
documents, paper and instruments necessary or desirable for Secured Party in the
use of the Collateral or (ii) take any other actions with respect to the
Collateral as Secured Party deems in the best interest of Secured Party, and (b)
from and after the occurrence and during the continuance of an Event of Default,
to assign, pledge, convey
-4-
or otherwise transfer title in or dispose of the Collateral to anyone. Debtor
hereby ratifies all that such attorney shall lawfully do or cause to be done by
virtue hereof. This power of attorney is coupled with an interest and shall be
irrevocable until the Obligations shall have been paid in full and discharged or
the security interests granted to Debtor by this Security Agreement have been
released.
10. License Back; Consents. Unless and until there shall have occurred an
----------------------
Event of Default which is not cured within the appropriate cure period and is
continuing or waived in writing by Secured Party, Secured Party hereby grants to
Debtor the exclusive, nontransferable right and license, for Debtor's own
benefit and account and none other, to use the Collateral in connection with the
Hotel Property; provided that Secured Party shall retain possession of all
securities constituting Collateral. If any Event of Default shall have occurred
and be continuing, Debtor's license shall terminate (unless Secured Party
consents to an extension in writing), and Secured Party shall have all of the
rights and remedies described herein. Debtor agrees that until the Obligations
shall have been satisfied in full and the security interest granted hereby has
been released, Debtor will not, without Secured Party's prior written consent,
enter into any agreement which is inconsistent with Debtor's obligations under
this Assignment or amends, modifies or terminates any of the Collateral. Debtor
further agrees that it will not take any action, or permit any action to be
taken by other subject to its control, including licensees, or fail to take any
action, which would affect the validity or enforcement of the rights transferred
to Secured Party under this Assignment. Notwithstanding the foregoing, however,
Debtor shall not grant any consent or approval under any of the Collateral
without the written consent of Secured Party. Debtor acknowledges that certain
ground lessors, managers, franchisors, licensors and liquor license companies
have executed or will execute consents and agreements for the benefit of Secured
Party, and Debtor hereby consents to all existing or hereinafter executed
consents and agreements.
11. Rights Cumulative. All of Secured Party's rights and remedies with
-----------------
respect to the Collateral, whether established by this Assignment, by the Notes,
by any other Credit Documents, or by law shall be cumulative and may be
exercised singularly or concurrently. Debtor acknowledges and agrees that this
Assignment is not intended to limit or restrict in any way the rights and
remedies of Secured Party under the Notes or any other Credit Document, but
rather is intended to facilitate the exercise of such rights and remedies
Secured Party shall have, in addition to all other rights and remedies given to
it by the terms of this Assignment, all rights and remedies allowed by law and
the rights and remedies of a secured party under the Uniform Commercial Code as
enacted in any jurisdiction in which the Collateral or Debtor may be located.
12. Additional Documents. Debtor shall sign any papers furnished by
--------------------
Secured Party which are necessary or desirable in the judgment of Secured Party
to obtain, maintain and perfect the security interest hereunder and to enable
Secured Party to comply with any
-5-
federal or state law in order to obtain or perfect Secured Party's interest in
the Collateral or to obtain proceeds of the Collateral.
13. Amendments, Etc. No amendment or waiver of any provision of this
---------------
Assignment nor consent to any departure by Debtor from this Assignment, shall be
effective unless the same is in writing and signed by Secured Party, and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.
14. Governing Law. This Assignment shall be governed by and construed and
-------------
enforced in accordance with the laws of the State of Texas and the relevant laws
of the United States of America.
15. Recordation and Filing. Secured Party shall have the continuing right
----------------------
to record or file a copy of this Assignment in any public records that Secured
Party desires.
16. Subordination. Debtor has subordinated and does hereby subordinate
-------------
all of its rights, liens and security interests in and to the Collateral and in,
to and under the Lease to the following: (i) the Credit Documents; (ii) all
renewals, substitutions, extensions, modifications, replacements or amendments
of the Credit Documents; and (iii) the Obligations and all other indebtedness
secured by the Credit Documents and all advances thereunder.
17. Credit Agreement. To the extent that any of the terms or provisions
----------------
of this Assignments are inconsistent with the terms or provisions of the Credit
Agreement, the terms and provisions of the Credit Agreement shall control.
18. Complete Agreement. THIS WRITTEN ASSIGNMENT, THE NOTES AND ALL OTHER
------------------
CREDIT DOCUMENTS ENTERED INTO BETWEEN THE PARTIES REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL
AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, Debtor has caused this Assignment to be duly executed
as of the date first set forth above.
DEBTOR:
___________________________
By:____________________
Name:__________________
Title:_________________
-6-
SECURED PARTY:
BANK ONE, TEXAS, N.A.
By:_____________________
Name:___________________
Title:__________________
-7-
[ADD APPROPRIATE FORM OF ACKNOWLEDGMENTS]
-8-
EXHIBIT A
LEGAL DESCRIPTION
-9-
Exhibit "J"
-
COMPLIANCE CERTIFICATE
This Compliance Certificate is executed this ___ day of _____________, 1996
and is prepared pursuant to Section 5.05 of that certain Credit Agreement (the
"Agreement") between AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership (the "Borrower"), SOCIETE GENERALE, SOUTHWEST
AGENCY, as Structuring Agent, BANK ONE, TEXAS, N.A., as Administrative Agent,
and the Banks parties to the Credit Agreement. Capitalized terms used herein but
not otherwise defined herein shall have the meanings specified by the Agreement.
1. REPRESENTATIONS, COVENANTS, DEFAULTS. Borrower hereby certifies to
------------------------------------
the Agents and the Banks, effective as of the date of execution of this
Compliance Certificate, as follows:
1.1 Covenants. All covenants of Borrower set forth in Articles V and
---------
VI of the Agreement required to be performed as of the date hereof have been
performed and maintained in all material respects, and such covenants continue
to be performed and maintained as of the execution date of this certificate,
except as follows:
___________________________________________________
___________________________________________________
1.2. Event of Default. There exists no Event of Default except as
----------------
follows:
___________________________________________________
___________________________________________________
___________________________________________________
2. OPERATING COVENANTS. Borrower hereby certifies to the Agents and the
-------------------
Banks, effective as of the calendar quarter ending ___________, 199__, that the
following amounts and calculations made pursuant to Sections 6.15, 6.16 and 6.17
of the Agreement are true and correct:
2.1 Borrower Debt Service Test
--------------------------
(a) Borrowing Base EBITDA for the Rolling
Period ending on _________ equals: __________
(b) Consolidated Indebtedness of the Borrower
and the Borrower's Subsidiaries (other than
the Permitted Other Subsidiaries) as of
______________ equals $__________________
times ______ (the Debt Service Rate) equals: __________
-----
Ratio of 2.1(a) to 2.1(b): __________
2.2 Parent Debt Service Test
------------------------
(a) Property EBITDA of all Hotel Properties
owned by the Parent and the Parent's
Subsidiaries (including without limitation
the Borrower, the Borrower's Subsidiaries
and the Permitted Other Subsidiaries)
for the Rolling Period equals: __________
(b) The Consolidated Indebtedness of the
Parent and the Parent's Subsidiaries as
of ___________ equal $_______________
times ___________ (the Debt Service Rate)
-----
equals: __________
Ratio of 2.2(a) to 2.2(b) __________
2.3 Parent's Net Worth Test
-----------------------
Parent's Consolidated Net Worth:
$100,000,000 plus 75% of the Net Cash
----
Proceeds from the Parent Capitalization
Event dated _____________ involving any
sale or issuance by the Parent or any of its
Subsidiaries of equity securities equals: __________
-2-
EXECUTED as of the date first referenced above.
BORROWER:
--------
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P.
By: AGH GP, Inc., its general partner
By:________________________________
Name:______________________________
Title:_____________________________
-3-
AGREEMENT AND DIRECTION TO PAY
------------------------------
[CREDIT CARD COMPANY AND CLEARINGHOUSE]
_______________________________________
_______________________________________
_______________________________________
Attention:_______________________________
This Agreement and Direction to Pay (this "Agreement") is made and entered
---------
into effective for all purposes as of the 31st day of July, 1996, by the parties
signatory hereto.
AGH Leasing L.P. ("Pledgor") and _______________________ ("Property Owner")
------- --------------
have entered into that certain Lease Agreement dated of even date herewith (the
"Lease Agreement") regarding certain real property and the improvements located
---------------
thereon (the "Property").
--------
Pledgor also has executed and delivered to Property Owner that certain
General Assignment and Agreement (as amended, restated, supplemented, or
otherwise modified from time to time, the "Assignment Agreement"), dated as of
--------------------
July 31, 1996, to and for the benefit of Property Owner, pursuant to which
Pledgor granted, assigned and pledged to Property Owner, among other things, all
credit card receipts and other income and receivables now or hereafter payable
to Pledgor in respect of certain hotel properties (the "Pledged Proceeds").
----------------
Pledgor and Property Owner desire to execute this Agreement to evidence
their agreement in respect of all the Pledged Proceeds which may now or
hereafter be due and payable by ______________________ (the "Company") to
-------
Pledgor and to direct the Company to pay such Pledged Proceeds as herein
provided.
Pledgor is executing this Agreement in consideration for and in connection
with the Lease Agreement.
In consideration of the foregoing, Pledgor and Property Owner hereby agree
and direct the Company as follows:
1. Commencing on the date hereof, and continuing until such time as the
Assignment Agreement has been terminated or the obligations secured thereby have
been fully performed or satisfied, the Company shall make all payments of the
Pledged Proceeds by wire transfer into the
AGREEMENT AND DIRECTION TO PAY - Page 1 of 8
------------------------------
following account (the "Account") maintained at Bank One, Texas, N.A., Dallas,
-------
Texas, or any successor bank appointed pursuant to the Credit Agreement
described herein (the "Cash Manager") and neither Pledgor nor the Company shall
------------
transfer, or permit the transfer of, any payment of the Pledged Proceeds to any
other account, without the prior written consent of Property Owner.
Account No. Account Name Name and Address
---------- ------------ ----------------
of the Depository Bank
----------------------
___________ ____________ Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
2. The directions herein are irrevocable and shall remain in full force
and effect until the Assignment Agreement has been terminated or the obligations
secured thereby have been fully performed or satisfied.
3. This Agreement shall be governed and construed in accordance with the
substantive laws of the State of Texas (without regard to conflict of laws
principles) and applicable United States federal law.
4. This Agreement may be executed in a number of identical counterparts,
each of which shall be deemed an original. In making proof of this Agreement, it
shall not be necessary for any party hereto to account for all counterparts, and
it shall be sufficient for such party to produce a counterpart signed by the
party to be bound hereby. It is not necessary that all parties execute the same
counterpart hereof, so long as each party executes an identical counterpart
hereof.
5. Property Owner may collaterally assign this Agreement and its rights,
in whole or in part, under this Agreement as collateral for any credit facility
secured in whole or in part by the Property, and Pledgor hereby irrevocably
consents and agrees to the same. In accordance therewith, the parties hereto
acknowledge and agree that all of the rights and interests of Property Owner
hereunder and under the Assignment Agreement in respect of the Pledged Proceeds
have been assigned to Bank One, Texas, N.A.("BOT"), as administrative agent
---
(BOT, or any successor to BOT as administrative agent, herein, the
"Administrative Agent") pursuant to that certain Credit Agreement dated July 31,
--------------------
1996, as amended from time to time, executed by and among American General
Hospitality Operating Partnership, L.P., Societe Generale, as structuring agent,
the lenders now or hereafter made a party thereto, and the Administrative Agent
(the "Credit Agreement"), as evidenced, in part, by that certain Joinder and
----------------
Agreement dated of even date herewith attached hereto
AGREEMENT AND DIRECTORY TO PAY - Page 2 of 8
------------------------------
and made a part of this Agreement for all purposes. Pledgor hereby consents to
such assignment by Property Owner to Administrative Agent. Pledgor acknowledges
that, until such time as Pledgor receives written notice from the Administrative
Agent that the Administrative Agent no longer has any interest in the Pledged
Proceeds, Property Owner shall have no rights in respect of the Pledged Proceeds
and Pledgor shall treat the Administrative Agent, for all purposes herein, as
the sole holder of the security interests created hereby or by the Assignment
Agreement.
EXECUTED effective as of the date first set forth above
PLEDGOR:
-------
AGH LEASING, L.P.,
a Delaware limited partnership
By: AGHL GP, Inc., a Delaware
corporation, its sole general
partner
By:_______________________
Name:_____________________
Title:____________________
PROPERTY OWNER:
--------------
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership.
By: AGH GP, Inc., its general
partner
By:____________________
Name:__________________
Title:_________________
AGREEMENT AND DIRECTION TO PAY - page 3 of 8
------------------------------
OR
_________________________
By: ________________ its
general partner
By:______________________
Name:____________________
Title:___________________
AGREEMENT AND DIRECTION TO PAY - Page 4 of 8
------------------------------
ACKNOWLEDGMENT AND CONSENT TO AGREEMENT AND DIRECTION TO PAY
------------------------------------------------------------
The undersigned hereby acknowledges the foregoing Agreement and Direction
to Pay and agrees for the benefit of Property Owner and the Administrative Agent
to pay all of the Pledged Proceeds into the Account as directed above.
The undersigned further agrees to continue to make such payments until the
earlier of (i) the date on which the agreement between Pledgor and the Company
in respect of the collection and payment of the Pledged Proceeds terminates, or
(ii) the date on which the undersigned is notified by a writing signed by
Property Owner and Administrative Agent that all obligations secured by the
Assignment Agreement have been fully performed or satisfied and the Assignment
Agreement has been terminated.
COMPANY:
-------
______________________________
By:___________________________
Name:_________________________
Title_________________________
AGREEMENT AND DIRECTION TO PAY - Page 5 or 8
------------------------------
JOINDER AND CONSENT
-------------------
This Joinder and Consent is attached to and forms a material part of that
Agreement and Direction to Pay (the "Agreement") dated as of July 31, 1996,
---------
executed by and between [CREDIT CARD COMPANY] (the "Company"), AGH Leasing, L.P.
-------
("Pledgor"), and American General Hospitality Operating Partnership, L.P. or___
-------
__________ ("Property Owner").
--------------
Pursuant to that certain Collateral Assignment and Security Agreement
("Security Agreement") dated as of July 31, 1996, executed by Property Owner to
------------------
and for the benefit of Bank One, Texas, N.A., as administrative agent (in such
capacity, "Administrative Agent") under that certain Credit Agreement dated as
--------------------
of July 31, 1996, as amended from time to time, executed by and among [PROPERTY
OWNER OR AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P.],
Administrative Agent, Societe Generale, as structuring agent, and the other
lenders now or hereafter made a party thereto ("Credit Agreement"), Property
----------------
Owner assigned, pledged and granted to Administrative Agent a continuing lien
and security interest in and to certain collateral including all of its rights
under the Assignment Agreement and all of its rights, title and interest in and
to the Pledged Proceeds granted to it under the Assignment Agreement.
Property Owner hereby (i) irrevocably directs Pledgor and the Company to
follow any instructions (including, without limitation, any requests for
withdrawals or information or any instructions in respect of the Pledged
Proceeds) with respect to the Pledged Proceeds that Pledgor or the Company may
receive from Administrative Agent in accordance with this Agreement; (ii)
acknowledges and agrees that Property Owner will have no rights in respect of
the Pledged Proceeds, including any rights to give any instructions with respect
thereto, all such rights hereafter being expressly reserved for Administrative
Agent, and for purposes of following any instructions of Administrative Agent,
Pledgor and the Company shall treat Administrative Agent as if it were sole
holder of all liens and security interests encumbering the Pledged Proceeds and
the funds from time to time held therein, without regard to any interest
Property Owner may have therein by virtue of the Assignment Agreement or
otherwise, and (iii) any funds from the Pledged Proceeds that are received by
Property Owner on or after the occurrence of an Event of Default under the
Credit Document shall be held IN TRUST for the benefit of Administrative Agent
and immediately delivered to Administrative Agent. Property Owner further
acknowledges and agrees that, during the term of the Agreement, Property Owner
will not take any action to exercise any of its rights and interest in respect
of the Assignment Agreement or the Pledged Proceeds without the prior written
consent of Administrative Agent, all such rights being assigned to and expressly
reserved for Administrative Agent.
Notwithstanding anything to the contrary in the Agreement, the Agreement
may not be amended or terminated by Property Owner without the prior written
consent of Administrative Agent. Any notice in respect of the Pledged Proceeds
or the Agreement shall be sent, simultaneously with the delivery of such notice
to Property Owner, to Administrative Agent at the
AGREEMENT AND DIRECTION TO PAY - Page 6 of 8
------------------------------
following address: Bank One, Texas, N.A., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Commercial Real Estate Lending (Telecopier:
(▇▇▇)▇▇▇-▇▇▇▇).
Dated as of 31st day of July, 1996.
BANK ONE TEXAS, N.A.
By:______________________________
Name:____________________________
Title:___________________________
The undersigned hereby acknowledge that the foregoing Joinder and Consent
is attached to and forms a material part of the Agreement and Direction to Pay
and agree for the benefit of Administrative Agent to comply with the directions
set forth above.
COMPANY:
-------
______________________________
By:___________________________
Name:_________________________
Title:________________________
PROPERTY OWNER:
--------------
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership
By: AGH GP, Inc., its general partner
By:_______________________
Name:_____________________
Title:____________________
AGREEMENT AND DIRECTION TO PAY - Page 7 of 8
------------------------------
OR,
_____________________________
By: ______________, its general partner
By:______________________
Name:____________________
Title:___________________
AGREEMENT AND DIRECTION TO PAY - Page 8 of 8
------------------------------
Property: ________________________________
Deposit Account No. ______________________
General Manager Account No. ______________
DEPOSIT ACCOUNT AGREEMENT
-------------------------
THIS DEPOSIT ACCOUNT AGREEMENT (this "Agreement") is executed effective as
---------
of the 31st day of July, 1996, by and among ____________________ [DEPOSITORY
BANK] (the "Bank"), AGH LEASING, L.P., a Delaware limited partnership
----
("Pledgor") and [AMERICAN GENERAL HOSPITALITY OPERATING LIMITED PARTNERSHIP,
-------
L.P., A DELAWARE LIMITED PARTNERSHIP OR ______________________] ("Property
--------
Owner").
-----
RECITALS:
A. Pledgor and Property Owner entered into that certain Lease Agreement
dated of even date herewith (the "Lease Agreement") regarding certain real
---------------
property and the improvements thereon more particularly described therein (the
"Property").
--------
B. Pledgor also executed and delivered to Property Owner that certain
General Assignment and Agreement (as amended, restated, supplemented, or
otherwise modified from time to time, the "Assignment Agreement"), dated as of
--------------------
July 31, 1996, pursuant to which Pledgor granted, assigned and pledged to
Property Owner a continuing lien and security interest in and to, among other
things, all right, title and interest in and to Account No. ___________ and
Account No. ____________________ each maintained with the Bank for and at the
request of Pledgor (together, the "Deposit Accounts"), together with all funds,
----------------
including any investments of and earnings on said funds, now or hereafter on
deposit in the Deposit Accounts, among other accounts (the "Pledged
-------
Collateral").
----------
NOW THEREFORE, for and in consideration of Ten Dollars ($10.00) and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. All monies received by the Bank for the account of Pledgor shall be
credited to the Deposit Accounts. All charges incurred in connection with the
operation of the Deposit Accounts will be charged to the Deposit Accounts.
2. The Bank agrees that, on or before the close of each business day (on
which both the Bank and Bank One, Texas, N.A. are open for the transaction of
business), the Bank will wire transfer all funds in the Deposit Accounts to the
following account (the "Operating Account")
-----------------
DEPOSIT ACCOUNT AGREEMENT - Page 1 of 10
-------------------------
maintained at Bank One, Texas, N.A., Dallas, Texas, or any successor bank
appointed pursuant to the Credit Agreement described herein (the "Cash
----
Manager"), and the Bank shall not transfer, or permit the transfer of, any funds
-------
from the Deposit Accounts to any other account, without the prior written
consent of Property Owner:
Account No. Account Name Name and Address of the
----------- ------------ -----------------------
Depository Bank
---------------
___________ ____________ Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
3. Pledgor hereby authorizes Property Owner, from and after the
occurrence of a Bankruptcy Event (as hereinafter defined) or a default (which
has not been remedied by the end of the applicable cure period) by Pledgor in
the payment or performance of any obligation secured by the Assignment Agreement
(a "Pledgor Default"), (i) to withdraw, collect and receipt for any and all
---------------
funds on deposit in or payable on the Deposit Accounts; (ii) on behalf of
Pledgor to endorse the name of Pledgor upon any checks, drafts or other
instruments payable to Pledgor evidencing payment on the Deposit Accounts; and
(iii) to surrender or present for notation of withdrawal the passbook,
certificate or other documents issued to Pledgor in connection with the Deposit
Accounts. Property Owner shall not be liable for any loss of interest on or any
penalty or charge assessed by the Bank against funds in, payable on, or
credited to the Deposit Accounts as a result of Property Owner exercising any of
its rights or remedies under this Agreement.
As used herein, the term "Bankruptcy Event" shall mean and refer to the
----------------
occurrence of one or more of the following events: Pledgor (A) executes an
assignment for the benefit of creditors, or takes any action in furtherance
thereof; (B) admits in writing its inability to pay, or fails to pay, its debts
generally as they become due; (C) as a debtor, files a petition, case,
proceeding or other action pursuant to, or voluntarily seeks the benefit of any
applicable laws pertaining to liquidation, bankruptcy, insolvency,
reorganization, receivership, or similar laws, domestic or foreign, affecting
the rights or remedies of creditors generally, in effect from time to time
(collectively, "Debtor Relief Law"), or takes an action in furtherance thereof;
-----------------
(D) seeks the appointment of a receiver, trustee, custodian or liquidator of any
part of the Eligible Property or of any significant portion of its other
property; or (E) suffers the filing of a petition, case, proceeding or other
action against it as a debtor under any Debtor Relief Law or seeking appointment
of a receiver, trustee, custodian or liquidator of any part of the Eligible
Property or of any significant portion of its other property.
4. The Bank agrees that, upon written demand from Property Owner
following the occurrence of a Bankruptcy Event or any Pledgor Default, the Bank
will promptly place a hold on
DEPOSIT ACCOUNT AGREEMENT - Page 2 of 10
-------------------------
the withdrawal of funds on deposit in the Deposit Accounts, except the daily
transfers by the Bank to the Operating Account. The Bank shall be fully
protected in relying upon the written statement of Property Owner that the
Deposit Accounts are at the time of such demand assigned hereunder and that
Property Owner is entitled to enforce its rights hereunder. Property Owner's
receipt for sums paid to it or withdrawn from the Deposit Accounts pursuant to
such demand shall be a full and complete release, discharge and acquittance to
the Bank to the extent of the amount so paid or withdrawn.
5. Pledgor hereby (i) irrevocably directs the Bank to follow any
instructions (including, without limitation, any requests for withdrawals or
information or any instructions to close the Deposit Accounts) with request to
the Deposit Accounts and any funds from time to time held therein, that the Bank
may receive from Property Owner in accordance with this Agreement, (ii)
acknowledges and agrees that, from and after the date that the Bank receives
written notice from Property Owner of the occurrence of a Bankruptcy Event or a
Pledgor Default, the Bank will place a hold on the withdrawal of funds on
deposit in the Deposit Account and prohibit withdrawals of funds from the
Deposit Accounts except by Property Owner, and Pledgor agrees that Pledgor will
have no right thereafter to withdraw funds from or close the Deposit Accounts or
give any instructions with respect thereto, all such rights thereafter being
expressly reserved for Property Owner, and for purposes of following any
instructions of Property Owner, the Bank shall treat Property Owner as if it
were sole owner of such Deposit Accounts and the funds from time to time held
therein, without regard to any interest Pledgor may have therein, and (iii) any
funds from the Deposit Accounts that are received by Pledgor on or after the
occurrence of a Pledgor Default or a Bankruptcy Event shall be held IN TRUST for
the benefit of Property Owner and immediately delivered to Property Owner or
immediately paid into the Deposit Accounts. Without limiting any of the
foregoing, Pledgor hereby acknowledges and agrees that all fees, expenses and
other costs in connection with the Deposit Accounts shall continue to be for the
sole account of Pledgor or as may otherwise be agreed to by Pledgor.
6. The directions set forth above may not be rescinded, amended or
modified without the prior written consent of Property Owner.
7. The Bank may charge back the Deposit Accounts for any customary and
usual service charges any credit given for any items which are returned
unpaid for any reason and for related account adjustments (such service charges,
returns and adjustments, and if the funds in the Deposit Accounts have been
charged and are insufficient to compensate the Bank, then the Bank shall be
entitled to offset the aggregate amounts owned to the Bank against any funds
subsequently deposited in the Deposit Accounts.
8. The Bank may rely upon any instructions given to it in writing by any
person purporting to be a representative of Property Owner in a writing
delivered to the Bank.
DEPOSIT ACCOUNT AGREEMENT - Page 3 of 10
-------------------------
9. Pledgor hereby agrees that it will indemnify and hold harmless the
Bank from and against any and all liabilities, obligations, claims, suits,
judgments, actions, losses, costs and expenses (including reasonable attorneys'
fees) arising out of or relating to this Agreement or the Pledged Collateral
(except those arising from the gross negligence or willful misconduct of the
Bank).
10. The Bank may terminate this Agreement only upon 30 days' prior written
notice to Pledgor and Property Owner. All notices sent hereunder shall be
addressed as follows:
To Pledgor at:
AGH Leasing, L.P.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
To Property Owner at:
[__________________________________________OR
AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P.]
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
To the Bank at:
_________________________________
_________________________________
_________________________________
Telecopier:______________________
This Agreement may be terminated upon 30 days' prior notice to the Bank (i) by a
writing signed by Pledgor and acknowledged by Property Owner, stating Pledgor's
desire to terminate this Agreement and close the Deposit Accounts, or (ii) by
Property Owner stating that the security interest of Property Owner in the
Deposit Accounts has been released.
DEPOSIT ACCOUNT AGREEMENT - Page 4 of 10
-------------------------
11. This Agreement shall become effective upon its execution by all
parties hereto and shall then be binding upon the parties hereto and their
respective successors and assigns. This Agreement may be executed by one or more
of the parties hereto in any number of counterparts, each of which when so
executed by one or more of the parties hereto in any number of counterparts,
each of which when so executed shall be an original, but all such counterparts
together shall constitute but one and the same instrument. This Agreement may
not be amended except in writing and signed by each of Property Owner, Pledgor
and the Bank. To the extent that any other agreement between the Bank and
Pledgor contradicts the terms of this Agreement, the terms of this Agreement
shall govern. This Agreement supersedes any previous agreements between the
parties hereto, whether written or oral, and contains the entire understanding
between the parties hereto with respect to the subject matter hereof.
12. This Agreement shall be governed and construed in accordance with the
substantive laws of the State of Texas (without regard to conflict of laws
principles) and applicable United States federal law.
13. This Agreement may be executed in a number of identical counterparts,
each of which shall be deemed an original. In making proof of this Agreement, it
shall not be necessary for any party hereto to account for all counterparts, and
it shall be sufficient for such party to produce a counterpart signed by the
party to be bound hereby. It is not necessary that all parties execute the same
counterpart hereof, so long as each party executes an identical counterpart
hereof.
14. Property Owner may collaterally assign this Agreement and its rights,
in whole or in part, under this Agreement as collateral for any credit facility
(including the credit facility evidenced by the Credit Agreement) secured in
whole or in part by the Property, and Pledgor hereby irrevocably consents and
agrees to the same. In connection therewith, the parties hereto acknowledge and
agree that all of the rights and interests of Property Owner hereunder and under
the Assignment Agreement in respect of the Pledged Collateral have been assigned
to Bank One, Texas, N.A. ("BOT"), as Administrative Agent (BOT, or any successor
---
to BOT as administrative agent, herein the "Administrative Agent") under that
--------------------
Credit Agreement dated July 31, 1996, as amended from time to time, executed by
and among American General Hospitality Operating Partnership, L.P., Societe
Generale, as structuring agent, the lenders now or hereafter made a party
thereto and the Administrative Agent (the "Credit Agreement"), as evidenced, in
----------------
part, by that certain Joinder and Agreement dated of even date herewith attached
hereto and made a part of this Agreement for all purposes. The Bank acknowledges
that, until such time as the Bank receives written notice from the
Administrative Agent that the Administrative Agent no longer has any interest in
the Pledged Collateral, Property Owner shall have no rights in respect of the
Deposit Accounts and the Bank shall treat the Administrative Agent, for all
purposes herein, as the sole holder of the security interests created hereby or
by the Assignment Agreement.
DEPOSIT ACCOUNT AGREEMENT - Page 5 of 10
----------------------------------------
EXECUTED as of the effective date set forth above.
BANK:
----
__________________________________
By:_____________________________________
Name:___________________________________
Title:__________________________________
PLEDGOR:
-------
AGH LEASING, L.P.,
a Delaware limited partnership
By: _____________________, a __________
corporation
its general partner
By:________________________________
Name:______________________________
Title:_____________________________
PROPERTY OWNER:
--------------
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership
By: AGH GP, Inc., its general
partner
By:________________________________
Name:______________________________
Title:_____________________________
DEPOSIT ACCOUNT AGREEMENT - Page 6 of 10
-------------------------
OR,
________________________________________
By: _________________, its general
partner
By:_____________________________________
Name:___________________________________
Title:__________________________________
DEPOSIT ACCOUNT AGREEMENT - Page 7 of 10
-------------------------
JOINDER AND CONSENT
-------------------
This Joinder and Consent is attached to and forms a material part of that
Deposit Account Agreement (the "Deposit Account Agreement") dated as of July 31,
-------------------------
1996, executed by and between AGH Leasing, L.P. ("Pledgor"), [AMERICAN GENERAL
-------
HOSPITALITY OPERATING PARTNERSHIP, L.P. OR ____________________] ("Property
--------
Owner") and ___________________________ ("Bank").
----- ----
Pursuant to that certain Collateral Assignment and Security Agreement
("Security Agreement") dated as of July 31, 1996, executed by Property Owner to
------------------
and for the benefit of Bank One, Texas, N.A., as administrative agent (in such
capacity, "Secured Party") under that certain Credit Agreement dated as of July
-------------
31, 1996, as amended from time to time, executed by and among [PROPERTY OWNER OR
AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P.], Secured Party,
Societe Generale, as Structuring Agent, and the other lenders now or hereafter
made a party thereto ("Credit Agreement"), Property Owner assigned, pledged and
----------------
granted to Secured Party a continuing lien and security interest in and to
certain collateral including all of its rights under the Deposit Account
Agreement and all of its rights, title and interest in and to the Deposit
Accounts granted to it under the Deposit Account Agreement (the "Pledged
-------
Collateral").
----------
Property Owner hereby (i) irrevocably directs the Bank to follow any
instructions (including, without limitation, any requests for withdrawals or
information or any instructions to close the Deposit Accounts) with respect to
the Deposit Accounts and any funds from time to time held therein, that the Bank
may receive from Secured Party in accordance with this Joinder and Consent and
the foregoing Deposit Account Agreement, (ii) acknowledges and agrees that
Property Owner will have no rights in respect of the Deposit Accounts, including
any rights to give any instructions with respect thereto, all such rights
hereafter being expressly reserved for Secured Party, and for purposes of
following any instructions of Secured Party, the Bank shall treat Secured Party
as if it were sole holder of all liens and security interests encumbering the
Deposit Accounts and the funds from time to time held therein, without regard to
any interest Property Owner may have therein by virtue of the Assignment
Agreement or otherwise, and (iii) any funds from the Deposit Accounts that are
received by Property Owner on or after the occurrence of a Pledgor Default or a
Bankruptcy Event (as those terms are defined in the Deposit Account Agreement)
shall be held IN TRUST for the benefit of Secured Party and immediately
delivered to Secured Party. Property Owner further acknowledges and agrees that,
during the term of this Agreement, Property Owner will not take any action to
exercise any of its rights and interests in respect of the Assignment Agreement
or the Pledged Collateral without the prior written consent of Secured Party,
all such rights being assigned to and expressly reserved for Secured Party.
The Bank shall furnish copies of its regular statements covering the
deposits to and withdrawals from the Deposit Accounts to Pledgor and, upon the
request of Secured Party, to Secured Party at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇ Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Commercial Real Estate Lending.
DEPOSIT ACCOUNT AGREEMENT - Page 8 of 10
-------------------------
Notwithstanding anything to the contrary in the Deposit Account Agreement,
the Deposit Account Agreement may not be amended or terminated by Property Owner
without the prior written consent of Secured Party. Any notice in respect of the
Pledged Collateral, the Deposit Accounts or the Deposit Account Agreement
delivered or sent by the Bank to the Property Owner shall be sent to Secured
Party simultaneously with the delivery of such notice to Property Owner at the
following address: Bank One, Texas, N.A., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Commercial Real Estate Lending
(Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇).
BANK ONE, TEXAS, N.A.
By:_____________________________________
Name:___________________________________
Title:__________________________________
ACKNOWLEDGED
AND AGREED:
BANK:
----
_________________________________
By:______________________________
Name:____________________________
Title:___________________________
PROPERTY OWNER:
--------------
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership
By: AGH GP, Inc., its general partner
By:______________________________
Name:____________________________
Title:___________________________
DEPOSIT ACCOUNT AGREEMENT - Page 9 0f 10
-------------------------
OR,
_______________________________
By: _______________, its general partner
By:_______________________
Name:_____________________
Title:____________________
DEPOSIT ACCOUNT AGREEMENT - Page 10 of 10
-------------------------
EXHIBIT "M"
-
ENVIRONMENTAL INDEMNIFICATION AGREEMENT
---------------------------------------
This Environmental Indemnification Agreement (this "Agreement") is made and
entered into effective for all purposes as of the _____ day of _____________,
1996, by the parties signatory hereto or to an Accession Agreement
(collectively, the "Indemnitor" whether one or more), to and for the benefit of
SOCIETE GENERALE, SOUTHWEST AGENCY, as Structuring Agent, BANK ONE, TEXAS, N.A.,
as Administrative Agent, and their respective successors, assigns and
participants (collectively referred to herein as the "Banks").
RECITALS
--------
A. On the date of this Agreement the Banks have extended a loan (the
"Loan") to American General Hospitality Operating Partnership, L.P. a Delaware
limited partnership (the "Borrower") in the original stated principal amount of
One Hundred Million and No/100 Dollars ($100,000,000) in accordance with the
terms of a Credit Agreement (the "Credit Agreement") of even date herewith
between Borrower and the Banks. The Borrower and Subsidiaries of the Borrower
now or hereafter will own certain Hotel Properties which include without
limitation the Initial Properties, the Future Properties, the Permitted
Non-Eligible Properties and the properties owned by the Permitted Other
Subsidiaries (said properties together with all property owned by the
Participating Lessees in connection with such Hotel Properties, all rights and
appurtenances to such Hotel Properties and all improvements presently located or
hereafter constructed on such Hotel Properties are hereinafter collectively call
the "Properties").
B. The Borrower is the principal financing equity for capital
requirements of its Subsidiaries, and from time to time the Borrower has made
and will continue to make capital contributions and advances to its
Subsidiaries, including the Subsidiaries which are parties hereto. Other than
the Parent, each Indemnitor is a direct or indirect subsidiary of the Borrower.
Each Indemnitor will derive substantial direct and indirect benefit from the
transactions contemplated by the Credit Agreement.
C. The Banks have required the execution and delivery of this Agreement
as a condition precedent to the extension of the Loan. The Banks would not be
willing to extend the Loan in the absence of the execution and delivery by
Indemnitor of this Agreement.
D. All terms used in this Agreement but not defined in this Agreement
shall have the meaning ascribed to such terms in the Credit Agreement.
AGREEMENT
---------
NOW, THEREFORE, Indemnitor, as an inducement to the Banks to make the Loan,
hereby covenants and agrees to and for the benefit of the Banks as follows:
1. HAZARDOUS MATERIAL. As used in this Agreement, the term "Hazardous
------------------
Materials" shall mean any flammable explosives, radioactive materials, hazardous
wastes, hazardous materials; hazardous or toxic substances, or related materials
as defined in the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. (S) 9601 et. seq.), the Hazardous
Materials Transportation Act, as amended (49 U.S.C. (S) 1801 et seq.), the
Resource Conservation and Recovery Act, as amended (42 U.S.C. (S) 6901 et seq.),
and in the regulations adopted and publications promulgated pursuant thereto,
and all friable asbestos, petroleum derivatives, polychlorinated biphenyls, and
materials defined as hazardous materials under any federal, state or local laws,
ordinances, codes, rules, orders, regulations or policies governing the use,
storage, treatment, transportation, manufacture, refinement, handling,
production or disposal thereof (collectively, "Environmental Laws").
2. REPRESENTATION. Except as set forth in the Environmental Reports,
--------------
Indemnitor warrants and represents to the Banks that it has no knowledge of (a)
the presence of any Hazardous Materials on any of the Properties except for
Permitted Hazardous Substances; or (b) any material spills, releases, discharges
or disposal of Hazardous Materials that have occurred or are presently occurring
off any of the Properties as a result of any construction on or operation and
use of any of the Properties. In connection with the operation and use of any of
the Properties, Indemnitor warrants and represents that, as of the date of this
Agreement, it has no knowledge of any failure to comply in all material respects
with all applicable law, state and federal environmental laws, regulations,
ordinances and administrative and judicial orders relating to the generation,
recycling, reuse, sale, storage, handling, transport and disposal of any
Hazardous Materials other than as set forth in the Environmental Reports.
3. COVENANT. Indemnitor covenants and agrees not to cause or permit the
--------
presence, use, generation, release, discharge, storage, disposal or
transportation of any Hazardous Materials on, under, in, about, to or from any
of the Properties except for Permitted Hazardous Substances.
4. INDEMNIFICATION. Indemnitor shall exonerate, indemnify, pay and
---------------
protect, defend (with counsel approved pursuant to the Credit Agreement) and
save the Structuring Agent, the Administrative Agent, the Banks, and their
respective directors, trustees, beneficiaries, officers, shareholders, employees
and agents of the Banks (collectively,the "Indemnified Parties"), harmless from
and against any claims (including, without limitation, third party claims for
personal injury or real or personal Properties damage), actions, administrative
proceedings (including informal
-2-
proceedings), judgments, damages, punitive damages, penalties, fines, costs,
taxes, assessments, liabilities (including, without limitation, sums paid in
settlements of claims), interest or losses, including reasonable attorneys' fees
and expenses (including, without limitation, any such reasonable fees and
expenses incurred in enforcing this Agreement or collecting any sums due
hereunder), consultant fees, and expert fees, together with all other reasonable
costs and expenses of any kind or nature (collectively, the "Costs") that arise
directly or indirectly in connection with the presence, suspected presence,
release or suspected release of any Hazardous Materials in or into the air,
soil, ground water, surface water or improvements at, on, about, under or within
any of the Properties, or any portion thereof, or elsewhere in connection with
the transportation of Hazardous Materials to or from any of the Properties (any
such release being referred to herein as a "Release"; provided however that
Indemnitor shall not be so liable for any Costs arising because of the gross
negligence or wilful misconduct of an Indemnified Party or Costs arising because
of a Release for a Property after the Administrative Agent or the Administrative
Agent's nominee acquires title to such Property. INDEMNITOR'S OBLIGATION TO SO
INDEMNIFY THE INDEMNIFIED PARTIES SHALL INCLUDE INDEMNIFICATION FOR ANY OF SUCH
MATTERS CAUSED IN WHOLE OR IN PART BY THE NEGLIGENCE OF ANY OF THE INDEMNIFIED
PARTIES. The indemnification provided in this paragraph shall specifically apply
to and include claims or actions brought by or on behalf of tenants or employees
of Indemnitor; Indemnitor hereby expressly waives (with respect to any claims of
the Indemnified Parties arising under this Agreement) any immunity to which
Indemnitor may otherwise be entitled under any industrial or worker's
compensation laws. In the event any of the Indemnified Parties shall suffer or
incur any such Costs, Indemnitor shall pay to the Administrative Agent for the
benefit of the Indemnified Party the total of all such Costs suffered or
incurred by such Indemnified Party within ten (10) days after demand therefor,
such payment to be disbursed by Administrative Agent in accordance with the
Credit Agreement. Without limiting the generality of the foregoing, the
indemnification provided by this paragraph 4 shall specifically cover Costs,
including, without limitation, capital, operating and maintenance costs,
incurred in connection with any investigation or monitoring of site conditions,
any clean-up, containment, remedial, removal or restoration work required or
performed by any federal, state or local governmental agency or political
subdivision ("Governmental Agency") or performed by any non-governmental entity
or person as required or requested, by any Governmental Agency because of the
presence, suspected presence, release or suspected release of any Hazardous
Materials in or into the air, soil, groundwater, surface water or improvements
at, on, under or within any of the Properties (or any portion thereof), or
elsewhere in connection with the transportation of Hazardous Materials to or
from any of the Properties, and any claims of third parties for loss or damage
due to such Hazardous Materials.
5. REMEDIAL WORK. In the event any investigation or monitoring of site
-------------
conditions or any clean-up, containment, restoration, removal or other remedial
work ("Remedial Work") is required (a) under any Environmental Law, (b) by any
judicial, arbitral or administrative order, (c)
-3-
in order to comply with any agreements affecting any of the Properties, or (d)
to maintain any of the Properties in a standard of environmental condition which
prevents the release or generation of any Hazardous Materials except for
Permitted Hazardous Substances, Indemnitor shall perform or cause to be
performed such Remedial Work; provided, that Indemnitor may withhold
commencement of such Remedial Work pending resolution of any good faith contest
regarding the application, interpretation or validity of any law, regulation,
order or agreement, subject to the requirements of Paragraph 6 below. All
Remedial Work shall be conducted (i) in a diligent and timely fashion by a
licensed environmental engineer, (ii) pursuant to a detailed written plan for
the Remedial Work approved by any Governmental Agency with a legal or
contractual right to such approval, (iii) with such insurance coverage
pertaining to liabilities arising out of the Remedial Work as is then
customarily maintained with respect to such activities and (iv) only following
receipt of all required permits, licenses or approvals. In addition, Indemnitor
shall submit to the Banks promptly upon receipt or preparation, copies of any
and all reports, studies, analyses, correspondence, governmental comments or
approvals, proposed removal or other Remedial Work contracts and similar
information prepared or received by Indemnitor in connection with any Remedial
Work or Hazardous Materials relating to any of the Properties. All costs and
expenses of such Remedial Work shall be paid by Indemnitor, including, without
limitation, the charges of the Remedial Work contractors and the consulting
environmental engineer, any taxes or penalties assessed in connection with the
Remedial Work and the Banks' reasonable fees and costs incurred in connection
with monitoring or review of such Remedial Work. In the event Indemnitor should
fail to commence or cause to be commenced such Remedial Work, in a timely
fashion, or fail diligently to prosecute to completion, such Remedial Work, the
Administrative Agent following consent of the Majority Banks (following thirty
(30) days written notice to Indemnitor) may, but shall not be required to, cause
such Remedial Work to be performed, and all costs and expenses thereof, or
incurred in connection therewith shall be Costs within the meaning of paragraph
4 above. All such Costs shall be due and payable to the Administrative Agent by
Indemnitor upon (30) days after demand therefor, such payments to be disbursed
by the Administrative Agent in accordance with the Credit Agreement.
6. PERMITTED CONTESTS. Notwithstanding any provision of this Agreement
------------------
to the contrary, Indemnitor may contest by appropriate action any Remedial Work
requirement imposed by any Governmental Agency provided that (a) if the Loan
then remains outstanding, no "Event of Default" has occurred and is continuing
under the Credit Agreement or any Credit Documents, (b) Indemnitor has given the
Banks written notice that Indemnitor is contesting or shall contest and
Indemnitor does in fact contest the application, interpretation or validity of
the law, regulation, order or agreement pertaining to the Remedial Work by
appropriate legal or administrative proceedings conducted in good faith and with
due diligence and dispatch, (c) such contest shall not subject any of the
Indemnified Parties nor any assignee of all or any portion of the Banks'
interest in the Loan nor any of the Properties to civil or criminal liability
and does not jeopardize any such party's lien upon or interest in any of the
Properties and (d) if the estimated cost of the Remedial Work is greater
-4-
than $2,500,000, Indemnitor shall give such security or assurances as may be
reasonably required by the Banks as determined pursuant to the Credit Agreement
to ensure ultimate compliance with all legal or contractual requirements
pertaining to the Remedial Work (and payment of all costs, expenses, interest
and penalties in connection therewith) and to prevent any sale, forfeiture or
loss by reason of nonpayment or noncompliance.
7. REPORTS AND CLAIMS. Indemnitor shall deliver to the Banks copies of
------------------
any reports, analyses, correspondence, notices, licenses, approvals, orders or
other written materials relating to the environmental condition of any of the
Properties promptly upon receipt, completion or delivery thereof. Indemnitor
shall give notice to the Banks of any claim, action, administrative proceeding
(including, without limitation, informal proceedings) or other demand by any
governmental agency or other third party involving Costs or Remedial Action at
the time such claim or other demand first becomes known to Indemnitor. Receipt
of any such notice shall not be deemed to create any obligation on the Banks to
defend or otherwise respond to any claim or demand. All notices, approvals,
consents, requests and demands upon the respective parties hereto shall be in
writing, including telegraphic communication and delivered or teletransmitted to
the Administrative Agent, as set forth in the Credit Agreement and to each
Indemnitor, at the address set forth beneath such Indemnitor's signature or in
the Accession Agreement executed by such Indemnitor, or to such other address as
shall be designated by any Indemnitor or the Administrative Agent in written
notice to the other parties. All such notices and other communications shall be
effective when delivered or teletransmitted to the above addresses.
8. BANKS AS OWNER. If for any reason, including foreclosure of the
--------------
Mortgages, the Administrative Agent or any of the Banks (or any successor or
assign of such parties) becomes the fee owner of any of the Properties and any
claim, action, notice, administrative proceeding (including, without limitation,
informal proceedings) or other demand is made by any governmental agency or
other third party which implicate Costs or Remedial Work, Indemnitor shall
cooperate with such party in any defense or other appropriate response to any
such claim or other demand; provided however that Indemnitor shall not be
so liable for any Costs arising because of the gross negligence or wilful
misconduct of an Indemnified Party. Indemnitor's duty to cooperate and right to
participate in the defense or response to any such claim or demand shall not be
deemed to limit or otherwise modify Indemnitor's obligations under this
Agreement. Any Party subject to a claim or other proceeding referenced in the
first sentence of this paragraph 8 shall give notice to Indemnitor of any claim
or demand governed by this paragraph 8 at the time such claim or other demand
first becomes known to such party.
9. SUBROGATION OF INDEMNITY RIGHTS. If Indemnitor fails to fully perform
-------------------------------
its obligations under paragraphs 4 and 5 above, the Indemnified Parties shall be
subrogated to any rights or claims Indemnitor may have against any present,
future or former owners, tenants or other
-5-
occupants or users of any of the Properties, any portion thereof or any adjacent
or proximate properties, relating to the recovery of Costs or the performance of
Remedial Work.
10. ASSIGNMENT BY AGENTS AND BANKS. No consent by Indemnitor shall be
------------------------------
required for any assignment or reassignment of the rights of the Structuring
Agent, the Administrative Agent or the Banks under this Agreement to any
successor of such party or a purchaser of the Loan or any interest in or portion
of the Loan including participation interests.
11. MERGER, CONSOLIDATION, OR SALE OF ASSETS. In the event Indemnitor is
----------------------------------------
dissolved, liquidated or terminated or all or substantially all the assets of
Indemnitor are sold or otherwise transferred to one or more persons or other
entities, the surviving entity or transferee or assets, as the case may be, (i)
shall be formed and existing under the laws of a state, (ii) shall deliver to
the Banks an acknowledged instrument in recordable form assuming all
obligations, covenants and responsibilities of Indemnitor under this Agreement.
12. INDEPENDENT OBLIGATIONS: SURVIVAL. The obligations of Indemnitor
---------------------------------
under this Agreement shall survive the consummation of the Loan transaction
described above and the repayment of the Loan and reconveyance or foreclosure of
the Mortgages. The obligations of Indemnitor under this Agreement are separate
and distinct from the obligations of Indemnitor under the Credit Documents, and
are not secured by the Mortgages or by any of the other Credit Documents
encumbering any of the Properties. This Agreement may be enforced by the Banks
without regard to or affecting any rights and remedies the Administrative Agent
and/or the Banks may have against Indemnitor under the Credit Documents and
without regard to any limitations on the Administrative Agent's or Banks'
recourse for recovery of the Loan as may be provided in the Credit Documents.
Enforcement of this Agreement is not and shall not be deemed to constitute an
action for recovery of the indebtedness of the Loan or for recovery of a
deficiency judgment against Indemnitor following foreclosure of the Mortgages or
any other Credit Documents encumbering any of the Properties.
13. DEFAULT INTEREST. In addition to all other rights and remedies of the
----------------
Banks against Indemnitor as provided herein, or under applicable law, Indemnitor
shall pay to the Administrative Agent, immediately upon demand therefor, Default
Interest (as defined below) on any Costs and other payments required to be paid
by Indemnitor to the Banks under this Agreement which are not paid within ten
(10) days after demand therefor, such payments to be disbursed by the
Administrative Agent in accordance with the Credit Agreement. Default Interest
shall be paid by Indemnitor from the date such payment becomes delinquent
through and including the date of payment of such delinquent sums. "Default
Interest" shall mean a per annum interest rate equal to three points above the
Adjusted Prime Rate or reference rate for the then current calendar month, as
-6-
of the first day of such calendar month, which is publicly announced from time
to time by the Administrative Agent.
14. CONTRIBUTION. As a result of the transactions contemplated by the
------------
Credit Agreement, each of the Indemnitors will benefit, directly and indirectly,
from the Obligations and in consideration thereof desire to enter into a
contribution agreement among themselves as set forth in this Section 14 to
allocate such benefits among themselves and to provide a fair and equitable
arrangement to make contributions in the event any payment is made by any
Indemnitor hereunder to the Structuring Agent, the Administrative Agent or the
Banks (such payment being referred to herein as a "Contribution," and for
purposes of this Agreement, includes any exercise of recourse by the
Administrative Agent against any Property of a Contributor designated as
collateral under any Security Document and application of proceeds of such
collateral in satisfaction of such Indemnitor's obligations under this
Agreement). The Indemnitors hereby agree as follows:
14.01 Calculation of Contribution. In order to provide for just and
---------------------------
equitable contribution among the Indemnitors in the event any Contribution
is made by a Indemnitor (a "Funding Indemnitor"), such Funding Indemnitor
shall be entitled to a contribution from certain other Indemnitors for all
payments, damages and expenses incurred by that Funding Indemnitor in
discharging any of the obligations under this Agreement (the
"Obligations"), in the manner and to the extent set forth in this Section.
The amount of any Contribution under this Agreement shall be equal to the
payment made by the Funding Indemnitor to the Administrative Agent or any
other beneficiary pursuant to this Agreement and shall be determined as of
the date on which such payment is made.
14.02 Benefit Amount Defined. For purposes of this Agreement, the
----------------------
"Benefit Amount" of any Indemnitor as of any date of determination shall be
the net value of the benefits to such Indemnitor and all of its
Subsidiaries (including any Subsidiaries which may be Indemnitors) from
extensions of credit made by the Banks to the Borrower under the Credit
Agreement; provided, that in determining the contribution liability of any
Indemnitor which is a Subsidiary to its direct or indirect parent
corporation or of any Indemnitor to its direct or indirect Subsidiary, the
Benefit Amount of such Subsidiary and its Subsidiaries, if any, shall be
subtracted in determining the Benefit Amount of the parent corporation.
Such benefits shall include benefits of funds constituting proceeds of
Advances made to the Borrower by the Banks which are in turn advanced or
contributed by the Borrower to such Indemnitor or its Subsidiaries and
benefits of Letters of Credit issued pursuant to the Credit Agreement on
behalf of, or the proceeds of which are advanced or contributed or
otherwise benefit, directly or indirectly, such Indemnitor and its
Subsidiaries (collectively, the "Benefits"). In the case of any proceeds of
Advances or Benefits advanced or contributed to a Person (an "Owned
Entity") any of the equity interests of which are owned directly or
-7-
indirectly by a Indemnitor, the Benefit Amount of a Indemnitor with respect
thereto shall be that portion of the net value of the benefits attributable
to Advances or Benefits equal to the direct or indirect percentage
ownership of such Indemnitor in its Owned Entity.
14.03. Contribution Obligation. Each Indemnitor shall be liable to a
-----------------------
Funding Indemnitor in an amount equal to the greater of (A) the (i) ratio
of the Benefit Amount of such Indemnitor to the total amount of
Obligations, multiplied by (ii) the amount of Obligations paid by such
Funding Indemnitor and (B) 95% of the excess of the fair saleable value of
the property of such Indemnitor over the total liabilities of such
Indemnitor (including the maximum amount reasonably expected to become due
in respect of contingent liabilities) determined as of the date on which
the payment made by a Funding Indemnitor is deemed made for purposes of
this Agreement (giving effect to all payments made by other Funding
Indemnitors as of such date in a manner to maximize the amount of such
contributions).
14.04 Allocation. In the event that at any time there exists more
----------
than one Funding Indemnitor with respect to any Contribution (in any such
case, the "Applicable Contribution"), then payment from other Indemnitors
pursuant to this Agreement shall be allocated among such Funding
Indemnitors in proportion to the total amount of the Contribution made for
or on account of the Borrower by each such Funding Indemnitor pursuant to
the Applicable Contribution. In the event that at any time any Indemnitor
pays an amount under this Agreement in excess of the amount calculated
pursuant to clause (A) of Subsection 14.03 above, that Indemnitor shall be
deemed to be a Funding Indemnitor to the extent of such excess and shall be
entitled to contribution from the other Indemnitors in accordance with the
provisions of this Section.
14.05 Subsidiary Payment. The amount of contribution payable under
------------------
this Section by any Indemnitor shall be reduced by the amount of any
contribution paid hereunder by a Subsidiary of such Indemnitor.
14.06 Equitable Allocation. If as a result of any reorganization,
--------------------
recapitalization, or other corporate change in the Borrower or any of its
Subsidiaries, or as a result of any amendment, waiver or modification of
the terms and conditions of other Sections of this Agreement or the
Obligations, or for any other reason, the contributions under this Section
become inequitable as among the Indemnitors, the Indemnitors shall promptly
modify and amend this Section to provide for an equitable allocation of
contributions. Any of the foregoing modifications and amendments shall be
in writing and signed by all Indemnitors.
-8-
14.07. Asset of Party to Which Contribution is Owing. The
---------------------------------------------
Indemnitors acknowledge that the right to contribution hereunder shall
constitute an asset in favor of the Indemnitor to which such contribution
is owing.
14.08. Subordination. No payments payable by a Indemnitor pursuant
-------------
to the terms of this Section 14 shall be paid until all amounts then due
and payable by the Borrower to the Administrative Agent, the Structuring
Agent or any Bank, pursuant to the terms of the Credit Documents, are paid
in full in cash. Nothing contained in this Section 14 shall affect the
obligations of any Indemnitor to the Administrative Agent, the Structuring
Agent or any Bank under the Credit Agreement or any other Credit Documents.
15. MISCELLANEOUS. If there shall be more than one Indemnitor hereunder,
-------------
or pursuant to any other indemnification of Banks relating to Hazardous
Materials arising out of or in connection with the Loan ("Other Indemnitor"),
each Indemnitor and Other Indemnitor agrees that (a) the obligations of the
Indemnitor hereunder, and each Other Indemnitor, are joint and several, (b) a
release of any one or more Indemnitors or Other Indemnitors or any limitation of
this Agreement in favor of or for the benefit of one or more Indemnitors or
Other Indemnitors shall not in any way be deemed a release of or limitation in
favor of or for the benefit of any other Indemnitor or Other Indemnitor and (c)
a separate action hereunder may be brought and prosecuted against any or all
Indemnitors or Other Indemnitors. If any term of this Agreement or any
application thereof shall be invalid, illegal or unenforceable, the remainder of
this Agreement and any other application of such term shall not be affected
thereby. No delay or omission in exercising any right hereunder shall operate as
a waiver of such right or any other right. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by Indemnitor and the Banks, and
their respective successors and assigns, including (without limitation) any
assignee or purchaser of all or any portion of the Banks' interest in (i) the
Loan, (ii) the Credit Documents, or (iii) any of the Properties.
16. GOVERNING LAW. This Agreement shall be governed by, and construed and
-------------
enforced in accordance with, the laws of the State of Texas. Each Indemnitor
hereby irrevocably submits to the jurisdiction of any Texas state or federal
court sitting in Dallas, Texas in any action or proceeding arising out of or
relating to this Agreement and the other Credit Documents, and such Indemnitor
hereby irrevocably agrees that all claims in respect of such action or
proceeding may be heard and determined in such court. Each Indemnitor hereby
irrevocably waives, to the fullest extent it may effectively do so, any right it
may have to the defense of an inconvenient forum to the maintenance of such
action or proceeding. Each Indemnitor hereby agrees that service of copies of
the summons and complaint and any other process which may be served in any such
action or proceeding may be made by mailing or delivering a copy of such process
to such Indemnitor at its address specified below. Each Indemnitor agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment
-9-
or in any other manner provided by law. Nothing in this Section shall affect the
rights of any of the Banks to serve legal process in any other manner permitted
by the law or affect the right of any of the Banks to bring any action or
proceeding against any Indemnitor or its Property in the courts of any other
jurisdiction.
17. WAIVERS OF JURY TRIALS. EACH INDEMNITOR HEREBY IRREVOCABLY AND
----------------------
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATING TO THIS
AGREEMENT OR THE NOTES OR ANY OTHER CREDIT DOCUMENT OR TO ANY COUNTERCLAIM
THEREIN.
18. AMENDMENTS/ACCESSION AGREEMENT. No waiver of any provision of this
------------------------------
Agreement nor consent to any departure by any Indemnitor therefrom shall be
effective unless the same shall be in writing and signed by the Administrative
Agent and the Majority Banks, and no amendment of this Agreement shall be
effective unless the same shall be in writing and signed by the Administrative
Agent, with the consent of the Majority Banks; provided that any amendment or
--------
waiver releasing any Indemnitor from any liability hereunder shall be signed by
all the Banks; and provided further that any waiver or consent shall be
----------------
effective only in the specific instance and for the specific purpose for which
given. Notwithstanding the foregoing, in the event that any Subsidiary or
Affiliate of the Borrower hereafter is required in accordance with the terms of
the Credit Agreement or otherwise agrees to become a Indemnitor under this
Agreement, then such Subsidiary or Affiliate may become a party to this
Agreement by executing an Accession Agreement ("Accession Agreement") in the
form attached hereto as Annex 1, and each Indemnitor and the Administrative
-------
Agent hereby agrees that upon such Subsidiary's or Affiliate's execution of such
Accession Agreement, this Agreement shall be deemed to have been amended to make
such Person an Indemnitor hereunder for all purposes and a party hereto and no
signature is required on behalf of the other Indemnitors or the Administrative
Agent to make such an amendment to this Agreement effective.
-10-
IN WITNESS WHEREOF, Indemnitor has caused this Agreement to be executed as
of the day and year first written above.
INDEMNITORS:
AMERICAN GENERAL HOSPITALITY
CORPORATION, a Maryland corporation
By:______________________________________________
Name:____________________________________________
Title:___________________________________________
Address: ▇▇▇▇ ▇.▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone:(▇▇▇)▇▇▇-▇▇▇▇
Telecopy: (▇▇▇)▇▇▇-▇▇▇▇
AGH UPREIT, LLC, a Delaware limited liability company
By: American General Hospitality Corporation, member
By:_________________________________________
Name:_______________________________________
Title:______________________________________
Address: ▇▇▇▇ ▇.▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone:(▇▇▇)▇▇▇-▇▇▇▇
Telecopy: (▇▇▇)▇▇▇-▇▇▇▇
-11-
3100 GLENDALE JOINT VENTURE,
an Ohio general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:___________________________________
Name:_________________________________
Title:________________________________
By: American General Hospitality Operating
Partnership, L.P., member
By: AGH GP, Inc., its general partner
By:______________________________
Name:____________________________
Title:___________________________
By: American General Hospitality Operating
Partnership, L.P., its partner
By: AGH GP, INC., general partner
By:___________________________________
Name:_________________________________
Title:________________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-12-
MDV LIMITED PARTNERSHIP,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:___________________________________
Name:_________________________________
Title:________________________________
By: American General Hospitality Operating
Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:______________________________
Name:____________________________
Title:___________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-13-
MADISON MOTEL ASSOCIATES,
a Wisconsin general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc., its general
partner
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., its
partner
By: AGH GP, Inc., general partner
By:___________________________
Name:_________________________
Title:________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-14-
183 HOTEL ASSOCIATES, LTD.,
a Texas limited partnership
By: AGH UPREIT LLC, its general manager
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:___________________________
Name:_________________________
Title:________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-▇▇-
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ASSOCIATES, LTD.,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:___________________________
Name:_________________________
Title:________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-16-
2929 ▇▇▇▇▇▇▇▇ LIMITED LIABILITY COMPANY, a
Delaware limited liability company
By: AGH UPREIT, LLC
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc., general partner
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., its
member
By: AGH GP, Inc., general partner
By:________________________________
Name:______________________________
Title:_____________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-17-
ANNEX 1
to Environmental Indemnification Agreement
ACCESSION AGREEMENT
_______________________[NAME OF ENTITY], a __________________ [limited
partnership/corporation] (the "Company"), hereby agrees with (i) BANK ONE,
TEXAS, N.A., as Administrative Agent (the "Agent") under the Credit Agreement
dated as of ________ __, 1996 among AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P., a Delaware limited partnership, as the Borrower, SOCIETE
GENERALE, SOUTHWEST AGENCY, as Structuring Agent, BANK ONE, TEXAS, N.A., as
Administrative Agent, and the Banks (as such agreement is amended from time to
time in accordance with its terms, the "Credit Agreement"; capitalized terms
used herein and not otherwise defined having the meanings set forth therein),
(ii) the parties to the Environmental Indemnity Agreement (the "Environmental
Indemnity Agreement") dated as of __________ __, 1996 executed in connection
with the Credit Agreement, and (iii) the parties to the Guaranty and
Contribution Agreement (the "Guaranty") dated as of _________ __, 1996 executed
in connection with the Credit Agreement as follows:
The Company hereby agrees and confirms that, as of the date hereof, it (a)
intends to be a party to the Environmental Indemnity Agreement and the Guaranty
and undertakes to perform all the obligations expressed therein, respectively,
of an Indemnitor and a Guarantor (as defined in the Environmental Indemnity
Agreement and the Guaranty, respectively), (b) agrees to be bound by all of the
provisions of the Environmental Indemnity Agreement and the Guaranty as if it
had been an original party to such agreements, and (c) confirms that the
representations and warranties set forth in the Environmental Indemnity
Agreement and the Guaranty, respectively, with respect to the Company, a party
thereto, are true and correct in all material respects as of the date of this
Accession Agreement.
For purposes of notices under the Environmental Indemnity Agreement and the
Guaranty the address for the Company is as follows:
________________________________________
________________________________________
Attention:______________________________
Telephone:______________________________
Telecopy:_______________________________
This Accession Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
IN WITNESS WHEREOF this Accession Agreement was executed and delivered as
of the ___ day of ________________, 19__.
[NAME OF ENTITY]
________________________________________
By:_____________________________________
Title:__________________________________
EXHIBIT "N"
FORM OF
FRANCHISOR'S CONSENT AND AGREEMENT
----------------------------------
THIS FRANCHISOR'S CONSENT AND AGREEMENT ("Agreement"), dated as of
___________, 1996, is executed by ________________________________________, a
______________________________ ("Franchisor"), having its address at
_______________________________________, in connection with that certain Credit
Agreement (the "Credit Agreement") dated as of ______________, 1996, by and
between AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a Delaware
limited partnership ("Borrower"); SOCIETE GENERALE, a French banking corporation
acting through its Southwest Agency, as Structuring Agent (the bank in such
capacity and its successors and assigns are referred to herein as "Structuring
Agent"); BANK ONE, TEXAS, N.A., a national banking association, having its
address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 4th Floor, P.O. Box 655415, Commerical Real Estate
Department - ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, as Administrative Agent
(the bank in such capacity and its successors and assigns are referred to herein
as "Administrative Agent"; the Structuring Agent and the Administrative Agent
are collectively referred to herein as the "Agents"); and the banks and other
financial institutions a party thereto (the "Banks").
WHEREAS, pursuant to the Credit Agreement the Banks have agreed to make a
loan (the "Loan") in the amount of $100,000,000.00 to Borrower to be secured by,
among other things, certain real property situated on the land more particularly
described in Exhibit "A" attached hereto and incorporated herein by this
reference (the "Property");
WHEREAS, either Borrower or an affiliate of Borrower ("Owner") has or will
become the owner of the Property;
WHEREAS, Owner will lease the Property to AGH Leasing, L.P., a Delaware
limited partnership ("Lessee");
NOW, THEREFORE, in consideration of the foregoing recitals and ten dollars
($10.00) in hand paid to Franchisor by Borrower, Franchisor warrants, represents
and agrees with the Agents and the Banks as follows:
1. FRANCHISOR'S REPRESENTATIONS: Franchisor warrants and represents to
----------------------------
the Agents and the Banks that the following are true and correct:
(a) That Franchisor has granted a license or franchise to Lessee in
connection with the Property and the improvements on the Property (the
"Improvements").
(b) That the entire agreement between Franchisor and Lessee for such
license or franchise is evidenced by an agreement (hereinafter referred to as
the "Franchise Agreement"), a true and correct copy of which is attached hereto
as Exhibit "B" and made a part hereof for all purposes.
(c) That the Franchise Agreement constitutes the valid and binding
agreement of Franchisor, enforceable in accordance with its terms, and
Franchisor has full authority under all state or local laws and regulations to
perform all of its obligations under said Franchise Agreement.
(d) That the licensee or franchisee under the Franchise Agreement is not
in default in the performance of any of its obligations under the Franchise
Agreement.
2. FRANCHISOR'S AGREEMENTS: Lease has advised Franchisor that Lessee
-----------------------
intends to pledge the Franchise Agreement as additional collateral for the Loan.
Franchisor hereby consents to the assignment of the Franchise Agreement to
Administrative Agent for the benefit of the Banks to secure the Loan. Further,
Franchisor hereby agrees to each and every one of the following for the benefit
of the Banks and as an inducement to the Banks to extend credit to Borrower
pursuant to the terms of the Credit Agreement:
(a) In the event of a default by Lessee or Borrower under any term,
covenant or provision of the Franchise Agreement, Franchisor will give
Administrative Agent thirty (30) days prior written notice of such default prior
to Franchisor's exercise of any of its rights or remedies under such Franchise
Agreement or at law, and Administrative Agent and the other Banks shall have the
right, but not the obligation, during said thirty (30) day period to cure such
default; provided, however, that if such default cannot be reasonably cured
during such thirty (30) day period, Administrative Agent and the Banks shall
have such longer period as is reasonably necessary to cure such default as long
as Administrative Agent or any Bank commences such cure within such thirty (30)
day period. Only in the event Administrative Agent and the Banks fail to timely
cure or cause to be cured any such default as provided in the foregoing sentence
shall Franchisor have the right to terminate the Franchise
-2-
Agreement. Franchisor will deliver to Administrative Agent a copy of all
notices of termination given by Franchisor to Lessee under the Franchise
Agreement simultaneously with the delivery of any such notice of termination to
Lessee.
(b) the Franchise Agreement and any and all liens, rights and interests
(whether ▇▇▇▇▇▇ or inchoate and including, without limitation, all mechanic's
and materialman's liens under applicable law) owned, claimed or held, or to be
owned, claimed or held by the Franchisor in and to the Property and the
Improvements now or hereafter constructed thereon, are and shall be in all
things subordinate and inferior to the full repayment of the Loan and the liens
and security interests created or to be created for the benefit of the Banks,
its successors and assigns, and securing the repayment of the Loan and
including, without limitation, those created under and by virtue of that certain
[Deed of Trust/Mortgage], Security Agreement, Assignment of Rents and Financing
Statement dated as of the date of the Credit Agreement (the "Mortgage"),
executed by Owner in favor of the Administrative Agent, as agent for the Banks,
covering the Property and filed or to be filed of record in the public records
maintained for the recording of mortgages and/or deeds of trust in the county
and state in which the Property is located, and all renewals and extensions
thereof.
(c) Upon the occurrence of an Event of Default (as defined in the Credit
Agreement), Franchisor shall, at the request of Administrative Agent, its
successors or assigns, continue performance on Administrative Agent's, its
successors' or assigns', behalf in accordance with the terms of the Franchise
Agreement, provided that Franchisor shall be paid all sums due or to become due
it in accordance with said Franchise Agreement following the date Administrative
Agent makes such request.
(d) Franchisor will not amend or modify the Franchise Agreement without
the prior written consent of Administrative Agent. In the event Franchisor
fails to secure such approval, the Franchise Agreement shall, for the purposes
of Franchisor's obligation aforesaid to continue performance thereunder for
Administrative Agent's and the Banks' benefit, be deemed not to have been
modified by such amendment.
(e) Neither the Agents, nor the Banks have an obligation to Franchisor
with respect to the Loan, and Agents and the Banks' obligations to Borrower and
Owner with respect thereto are set forth in the Credit Agreement and certain
other Credit Documents by and between Bank, Borrower and Owner ("Credit
Documents"), with respect to which the Franchisor is not a third party
beneficiary. The relationship of Bank to Borrower
-3-
and to Owner is one of a creditor to a debtor, and Bank is not a joint
venturer or partner of Owner.
(f) Franchisor further agrees that nothing herein shall impose upon the
Agents or the Banks any obligation for payment or performance in favor of
Franchisor unless Administrative Agent notifies Franchisor in writing after an
Event of Default, that (i) Administrative Agent has elected to assert the
Lessee's rights under the Franchise Agreement and (ii) Administrative Agent
agrees to pay Franchisor the sums due Franchisor under the terms of the
Franchise Agreement.
(g) Franchisor covenants and agrees that, upon Administrative Agent or any
Bank or any other party (a "Subsequent Owner") acquiring title to the Property
and Improvements either through foreclosure or by acceptance of a deed,
assignment or other conveyance in lieu thereof (collectively, "Foreclosure") or
after Foreclosure, any Subsequent Owner shall have the continuing right to
terminate the Franchise Agreement upon no less than thirty (30) days prior
written notice to Franchisor without any obligation to pay a termination or
cancellation fee or penalty to Franchisor. A Subsequent Owner shall only incur
liability to Franchisor under the Franchise Agreement during such Subsequent
Owner's ownership of the Property and Improvements. Upon a sale, conveyance,
transfer or other assignment of the Property and Improvements or a termination
of the Franchise Agreement, a Subsequent Owner shall have no further liability
to Franchisor under the Franchise Agreement from the date of such sale,
conveyance, transfer, assignment or termination.
(h) Franchisor hereby represents and warrants that no prior assignment of
Franchisor's interest in the Agreements has been made, and Franchisor agrees and
covenants not to assign, sell, pledge, transfer or otherwise encumber
Franchisor's interest in the Agreements so long as any portion of the Loan
remains outstanding.
(i) Franchisor has executed this Agreement for the purpose of inducing
the Banks to advance sums to Borrower under the Credit Agreement and with full
knowledge and intent that the Banks shall rely upon the representations,
warranties and agreements herein contained when making advances to Borrower, and
that but for this instrument and the representations, warranties and agreements
herein contained, the Banks would not take such actions.
3. NOTICES: All notices hereunder shall be hand-delivered or sent by
-------
United States registered or certified mail, with return receipt requested,
postage prepaid to the parties hereto at their respective addresses set forth
above
-4-
(or at such other address as shall be given in writing in the manner set forth
above) and shall be deemed given upon receipt.
4. LESSEE'S CONSENT: Lessee has joined herein to evidence its consent to
----------------
all the agreements of Franchisor contained in this Agreement.
EXECUTED this the ______ day of ____________, 199__.
FRANCHISOR:
___________________________________
By:________________________________
Name:______________________________
Title:_____________________________
[ADD ACKNOWLEDGMENT IN THE FORM OF THE STATE IN WHICH THE PROPERTY IS LOCATED]
-5-
LESSEE:
AGH LEASING, L.P., a
Delaware limited partnership
By:_________________________,
its general partner
BY:__________________________
NAME:________________________
TITLE:_______________________
[ADD ACKNOWLEDGEMENT IN THE FORM OF THE STATE IN WHICH THE PROPERTY IS LOCATED]
-6-
EXHIBITS
--------
Exhibit "A" - Legal Description
Exhibit "B" - Franchise Agreement
[LETTERHEAD OF HOLIDAY INN]
July 11, 1996 VIA OVERNIGHT COURIER
---------------------
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Lending
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
RE: LICENSE AGREEMENT BETWEEN HOLIDAY INNS FRANCHISING, INC. ("HIFI") AND
AGH LEASING, L.P. ("LICENSEE") DATED JULY 18, 1996, (THE "LICENSE")
FOR THE HOLIDAY INN HOTEL LOCATED AT DALLAS-FT. WORTH-ARPT-WEST,
TX/#1814 ("HOTEL")
Ladies and Gentlemen:
HIFI has entered into a License pertaining to the operation of the Hotel as
a Holiday Inn hotel. Attached hereto on Exhibit "A" is a list of lenders
("Lenders") that are entitled to have the benefits of this Letter Agreement. The
initial Lender to have the benefits of this Letter Agreement is Bank One, Texas,
N.A., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ("Servicing Lender").
Bank One, Texas, N.A. may in the future designate in writing to HIFI any other
Lender identified on Exhibit "A" to have the benefits of this Letter Agreement
in its place and such Lender shall thereafter be the Servicing Lender.
1. HIFI shall use its reasonable efforts to give Servicing Lender 30
days' prior written notice of any voluntary surrender by Licensee of the
License (to the extent that HIFI is aware in advance of any such voluntary
surrender); and HIFI shall also give Servicing Lender 30 days' prior written
notice of any action it intends to take under the License as a result of any
default(s) by Licensee under the License, provided (a) that the first mortgage
of which Servicing Lender is involved and the License are in full force and
effect at the time of the event(s) set out above; (b) that Servicing Lender is
not in receivership or conservatorship; (c) that Servicing Lender has not been
taken over by any state or federal regulatory agency; and (d) that neither
Servicing Lender nor any of its respective directors or officers have entered
into any cease and desist order or any other formal or informal written
agreement with a federal or state regulatory agency. The notice given to
Servicing Lender concerning Licensee's default(s) will allow Servicing Lender 30
days from the date thereof to cure or cause to be cured the default(s). HIFI may
at its option, upon Servicing Lender's written request to it, deliver to
Servicing Lender copies of any of its product quality reports and/or notices of
non-payment of fees pertaining to the Hotel.
Bank One, Texas, N.A.
July 11, 1996
Page -2-
2. (A) In the event Servicing Lender acquires possession and control of
the Hotel by foreclosure or deed in lieu of foreclosure or otherwise, either:
(1) while the License is in full force and effect; or (2) within 60 days
following the date of HIFI's termination of the License; Servicing Lender shall
have 30 days from such acquisition to elect, by written notice to HIFI
accompanied by a non-refundable processing charge of $5,000.00, to obtain a new
License in the form and specifying the royalty and other fees then being used or
charged by HIFI and for a term equal to the balance of the original term under
the License, except that Servicing Lender shall not be charged the initial fee
(as same as described in HIFI's then current Franchise Offering Circular for
Prospective Franchisees), provided: (a) that Servicing Lender is not in
receivership or conservatorship; (b) that Servicing Lender has not been taken
over by any state or federal regulatory agency; and (c) that neither Servicing
Lender, nor any of its respective directors or officers have entered into any
cease and desist order or any other formal or informal written agreement with a
federal or state regulatory agency.
(B) All defaults and breaches under the License must be cured by
Servicing Lender within 30 days from the date of Servicing Lender's election to
obtain a new License including, but not limited to any monies due with respect
to the Hotel, to HIFI, or its parent, subsidiaries, divisions or affiliates.
With respect to any defaults or breaches of a non-monetary nature which are not
reasonably capable of being cured within said 30-day period, HIFI may extend,
for such time as it in its sole discretion may reasonably determine, the period
of time in which such defaults(s) may be cured. A new License will not be
issued to Servicing Lender until all defaults are cured. Servicing Lender shall
further comply with HIFI's then-current procedures concerning the issuance of a
License.
(C) In the event that Servicing Lender acquires the Hotel as set out
in paragraph 2 above, Servicing Lender shall furnish HIFI with reasonably
satisfactory evidence of such acquisition.
(D) If you have a receiver appointed with respect to the Hotel during
a foreclosure proceeding against Licensee, HIFI shall enter into its standard
form short term receivership license with such receiver, which will not exceed a
term of 12 months, provided: (a) you are entitled to make and have made your
election to exercise your rights hereunder; (b) HIFI and you have reached
agreement concerning any cure under paragraph 2 (B) hereof and any financial
defaults, including any defaults under any agreements with HIFI's subsidiaries
or affiliates, have been cured; (c) you guaranty such receiver's obligation
under its license in HIFI's standard form of guaranty; and (d) such receiver
meets HIFI's licensing criteria.
3. Neither Servicing Lender nor any of the Lenders shall have the right
to assign, transfer, sell or otherwise convey the License, and any License that
may be issued to Servicing Lender pursuant to the terms of this letter shall not
be assignable. Neither Servicing Lender nor
Bank One, Texas, N.A.
July 11, 1996
Page-3-
any of the Lenders' rights under this letter are assignable. A new owner of the
Hotel may apply for a Holiday Inn hotel License Agreement, and such application
will be processed in accordance with HIFI's then-current requirements and
procedures.
4. By its signature below, Licensee acknowledges that this letter was
provided to Servicing Lender at Licensee's request in order to induce Servicing
Lender to provide financing for the Hotel, and in consideration thereof,
Licensee hereby releases Servicing Lender and the Lenders, and HIFI, as well as
each of our respective subsidiaries, parents, divisions, successors, assigns,
heirs and representatives, including but not limited to our respective
employees, agents, officers, directors and stockholders of and from any and all
actions, causes of action, suits, claims, demands, contingencies, debts,
accounts and judgments whatsoever, at law or in equity, whether known or
unknown, arising from the exercise by Servicing Lender or any Lender of any of
the rights granted hereunder and the recognition and compliance with such
exercise by HIFI. It is further acknowledged and agreed that HIFI shall be
entitled to rely upon any written notice or request by Servicing Lender made
pursuant to the provisions hereof without requirement of necessitating the
accuracy or authenticity of such written notice or any fact or allegations
contained therein.
5. (A) Servicing Lender and the Lenders agree to notify HIFI, by mail,
10 days in advance of any action to: (a) commence foreclosure proceedings
regarding the Hotel; or (b) petition for appointment of a receiver, obtain the
entry of an order for relief or take any action under federal or state
bankruptcy laws or similar laws with regard to the Hotel; or (c) accept a deed
for the Hotel in lieu of foreclosure; or (d) take ownership or possession of the
Hotel in any manner.
(B) Servicing Lender agrees to notify HIFI promptly upon: (a) any
change in your address; or (b) the satisfaction, cancellation, sale or
assignment of Servicing Lenders or any Lenders' mortgage on the Hotel.
6. Notwithstanding anything else herein to the contrary, Servicing Lender
may, upon written notice to HIFI, designate any of the Lenders as a substitute
Servicing Lender ("Sub-Servicing lender") under the terms of this Comfort
Letter. At such time, the Sub-Servicing Lender shall obtain all of present
Servicing Lender's rights under the Comfort Letter, provided that, it enters
into a new Comfort Letter agreement with HIFI under the same terms and
conditions hereof.
Bank One, Texas, N.A.
July 11, 1996
Page -4-
7. The provisions of this letter are not intended to and do not in any
way alter, modify or amend the License or assign any rights thereunder.
8. Notices shall be addressed to HIFI as follows:
Holiday Inns Franchising, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Vice President, Franchise Administration
Notices shall be addressed to you as follows:
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Lending
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Notices shall be given by certified mail, return receipt requested, or
by Federal Express or other express delivery service.
Bank One, Texas, N.A.
July 11, 1996
Page -5-
9. This letter constitutes an offer which shall be deemed revoked and
null and void unless the duplicate originals hereof are signed by both Servicing
Lender and Licensee and received by HIFI on or before August 12, 1996. An
executed copy will be returned to Servicing Lender and Licensee.
Sincerely,
▇▇▇ ▇▇▇▇▇
Vice President
Franchise Administration
Agreed and Accepted:
AGH Leasing, L.P. Bank One, Texas, N.A.
By: AGHL GP, Inc., General Partner
By: xxx By:__________________________
-----------------------------
Title: Executive Vice President Title:_______________________
--------------------------
Attest: xxx Attest:______________________
-------------------------
Senior Vice President Secretary
Date: 7/12/96 Date:________________________
--------------------------
Loan No._____________________
EXHIBIT "A"
List of Lenders
First National Bank of Commerce
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Bank of Nova Scotia
New York Agency
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Sociate Generale
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
[LETTERHEAD OF CROWNE PLAZA APPEARS HERE]
July 11, 1996 VIA OVERNIGHT COURIER
---------------------
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Lending
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
RE: LICENSE AGREEMENT BETWEEN HOLIDAY INNS FRANCHISING, INC.("HIFI")
AND AGH LEASING, L.P. ("LICENSEE") DATED JULY 31, 1996
(THE "LICENSE") FOR THE CROWNE PLAZA HOTEL LOCATED AT SAN
▇▇▇▇-PARK, CENTER PLAZA, CA /#4367 ("HOTEL")
Ladies and Gentlemen:
HIFI has entered into a License pertaining to the operation of the Hotel as
a Holiday Inn hotel. Attached hereto on Exhibit "A" is a list of lenders
("Lenders") that are entitled to have the benefits of this Letter Agreement. The
initial Lender to have the benefits of this Letter Agreement is Bank One, Texas,
N.A., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ("Servicing Lender").
Bank One, Texas, N.A. may in the future designate in writing to HIFI any other
Lender identified on Exhibit "A" to have the benefits of this Letter Agreement
in its place and such Lender shall thereafter be the Servicing Lender.
1. HIFI shall use its reasonable efforts to give Servicing Lender 30
days' prior written notice of any voluntary surrender by Licensee of the License
(to the extent that HIFI is aware in advance of any such voluntary surrender);
and HIFI shall also give Servicing Lender 30 days' prior written notice of any
action it intends to take under the License as a result of any default(s) by
Licensee under the License, provided (a) that the first mortgage of which
Servicing Lender is involved and the License are in full force and effect at the
time of the event(s) set out above; (b) that Servicing Lender is not in
receivership or conservatorship; (c) that Servicing Lender has not been taken
over by any state or federal regulatory agency; and (d) that neither Servicing
Lender nor any of its respective directors or officers have entered into any
cease and desist order or any other formal or informal written agreement with a
federal or state regulatory agency. The notice given to Servicing Lender
concerning Licensee's default(s) will allow Servicing Lender 30 days from the
date thereof to cure or cause to be cured the default(s). HIFI may at its
option, upon Servicing Lender's written request to it, deliver to Servicing
Lender copies of any of its product quality reports and/or notices of
non-payment of fees pertaining to the Hotel.
HOLIDAY INN/F/ WORLDWIDE HOTELS
HOLIDAY INNS, INC., A BASS COMPANY
Bank One, Texas, N.A.
July 11, 1996
Page -2-
2. (A) In the event Servicing Lender acquires possession and control of
the Hotel by foreclosure or deed in lieu of foreclosure or otherwise, either:
(1) while the License is in full force and effect; or (2) within 60 days
following the date of HIFI's termination of the License; Servicing lender shall
have 30 days from such acquisition to elect, by written notice to HIFI
accompanied by a non-refundable processing charge of $5,000.00, to obtain a new
License in the form and specifying the royalty and other fees then being used
or charged by HIFI and for a term equal to the balance of the original term
under the License, except that Servicing Lender shall not be charged the
initial fee (as same as described in HIFI's then current Franchise Offering
Circular for Prospective Franchisees), provided: (a) that Servicing Lender is
not in receivership or conservatorship; (b) that Servicing Lender has not been
taken over by any state or federal regulatory agency; and (c) that neither
Servicing Lender, nor any of its respective directors or officers have entered
into any cease and desist order or any other formal or informal written
agreement with a federal or state regulatory agency.
(B) All defaults and breaches under the License must be cured by
Servicing Lender within 30 days from the date of Servicing Lender's election to
obtain a new License including, but not limited to any monies due with respect
to the Hotel, to HIFI, or its parent, subsidiaries, divisions or affiliates.
With respect to any defaults or breaches of a non-monetary nature which are not
reasonably capable of being cured within said 30-day period, HIFI may extend,
for such time as it in its sole discretion may reasonably determine, the period
of time in which such default(s) may be cured. A new License will not be issued
to Servicing Lender until all defaults are cured. Servicing Lender shall further
comply with HIFI's then-current procedures concerning the issuance of a License.
(C) In the event that Servicing Lender acquires the Hotel as set out
in paragraph 2 above, Servicing Lender shall furnish HIFI with reasonably
satisfactory evidence of such acquisition.
(D) If you have a receiver appointed with respect to the Hotel during
a foreclosure proceeding against Licensee, HIFI shall enter into its standard
form short term receivership license with such receiver, which will not exceed a
term of 12 months, provided: (a) you are entitled to make and have made your
election to exercise your rights hereunder; (b) HIFI and you have reached
agreement concerning any cure under paragraph 2(B) hereof and any financial
defaults, including any defaults under any agreements with HIFI's subsidiaries
or affiliates, have been cured; (c) you guaranty such receiver's obligation
under its license in HIFI's standard form of guaranty; and (d) such receiver
meets HIFI's licensing criteria.
3. Neither Serving Lender nor any of the Lenders shall have the right to
assign, transfer, sell or otherwise convey the License, and any License that may
be issued to Servicing Lender pursuant to the terms of this letter shall not be
assignable. Neither Servicing Lender nor
Bank One, Texas, N.A.
July 11, 1996
Page -3-
any of the Lenders' rights under this letter are assignable. A new owner of the
Hotel may apply for a Holiday Inn hotel License Agreement, and such application
will be processed in accordance with HIFI's then-current requirements and
procedures.
4. By its signature below, Licensee acknowledges that this letter was
provided to Servicing Lender at Licensee's request in order to induce Servicing
Lender to provide financing for the Hotel, and in consideration thereof,
Licensee hereby releases Servicing Lender and the Lenders, and HIFI, as well as
each of our respective subsidiaries, parents, divisions, successors, assigns,
heirs and representatives, including but not limited to our respective
employees, agents, officers, directors and stockholders of and from any and all
actions, causes of action, suits, claims, demands, contingencies, debts,
accounts and judgments whatsoever, at law or in equity, whether known or
unknown, arising from the exercise by Servicing Lender or any Lender or any
Lender of any of the rights granted hereunder and the recognition and compliance
with such exercise by HIFI. It is further acknowledged and agreed that HIFI
shall be entitled to rely upon any written notice or request by Servicing Lender
made pursuant to the provisions hereof without requirement of necessitating the
accuracy or authenticity of such written notice or any facts or allegations
contained therein.
5. (A) Servicing Lender and the Lenders agree to notify HIFI, by mail,
10 days in advance of any action to: (a) commence foreclosure proceedings
regarding the Hotel; or (b) petition for appointment of a receiver, obtain the
entry of an order for relief or take any action under federal or state
bankruptcy laws or similar laws with regard to the Hotel; or (c) accept a deed
for the Hotel in lieu of foreclosure; or (d) take ownership or possession of the
Hotel in any manner.
(B) Servicing Lender agrees to notify HIFI promptly upon: (a) any
change in your address; or (b) the satisfaction, cancellation, sale or
assignment of Servicing Lenders or any Lenders' mortgage on the Hotel.
6. Notwithstanding anything else herein to the contrary, Servicing Lender
may, upon written notice to HIFI, designate any of the Lenders as a substitute
Servicing Lender ("Sub-Servicing Lender") under the terms of this Comfort
Letter. At such time, the Sub-Servicing Lender shall obtain all of present
Servicing Lender's rights under the Comfort Letter, provided that, it enters
into a new Comfort Letter agreement with HIFI under the same terms and
conditions hereof.
Bank One, Texas, N.A.
July 11, 1996
Page -4-
7. The provisions of this letter are not intended to and do not in any
way alter, modify or amend the License or assign any rights thereunder.
8. Notices shall be addressed to HIFI as follows:
Holiday Inns Franchising, Inc
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Vice President, Franchise Administration
Notices shall be addressed to you as follows:
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Lending
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Notices shall be given by certified mail, return receipt requested, or
by Federal Express or other express delivery service.
Bank One, Texas, N.A.
July 11, 1996
Page -5-
9. This letter constitutes an offer which shall be deemed revoked and
null and void unless the duplicate originals hereof are signed by both Servicing
Lender and Licensee and received by HIFI on or before August 12, 1996. An
executed copy will be returned to Servicing Lender and Licensee.
Sincerely,
/s/ ▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇ ▇▇▇▇▇
Vice President
Franchise Administration
Agreed and Accepted:
AGH Leasing, L.P. Bank One, Texas, N.A.
By: AGHL GP, Inc., General Partner
By: xxx By:__________________________
-----------------------------
Title: Executive Vice President Title:_______________________
--------------------------
Attest: xxx Attest:______________________
-------------------------
Senior Vice President Secretary
Date: 7/12/96 Date:________________________
--------------------------
Loan No._____________________
EXHIBIT "A"
List of Lenders
First National Bank of Commerce
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Bank of Nova Scotia
New York Agency
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Sociate Generale
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
[LETTERHEAD OF PROMUS HOTEL CORPORATION]
July 30, ▇▇▇▇
▇▇▇▇ ▇▇▇, ▇▇▇▇▇, N.A.,
as Administrative Agent
Commercial Real Estate Department
▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
4th Floor, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
RE: Comfort Letter for Hampton Inn hotel located at located at ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, (▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇), ▇▇▇▇▇▇▇▇ (the
"Hotel")
Dear ▇▇. ▇▇▇▇▇▇▇:
As requested by ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, please find enclosed three execution
originals of our standard comfort letter regarding the referenced property,
which have been executed by Promus Hotels, Inc. ("Promus").
While we do not allow the transfer or assignment of comfort letters, Promus
will, as an accommodation to you, allow the appointment of Societe Generale to
replace you as Administrative Agent, provided your request is received by Promus
in writing prior to the appointment. If you wish to appoint an entity other than
Societe Generale as Administrative agent, your written request must be received
prior to the appointment, such entity must be accepted and approved by Promus,
and be fully guaranteed by Bank One Texas, N.A. and/or Societe Generale. This
assignment condition is for the benefit of Bank One, Texas, N.A. and will not be
extended to any substituted or appointed entity.
Please have each of the three originals signed (as indicated) by the Lender
and Licensee with each retaining one original for their respective files. The
third fully executed original must be returned to my attention within thirty
(30) days from the date of the letter, or the letter becomes null and void. A
self-addressed return envelope is enclosed for your convenience.
Should you have any questions, please let me know.
Very truly yours,
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Franchise Administrator
Development Administration
/cpc
Enclosure(s)
[LETTERHEAD OF PROMUS HOTEL CORPORATION]
July 30,1996
Bank One, Texas, N.A.,
as Administrative Agent
Commercial Real Estate Department
▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
4th Floor, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Hampton Inn License Agreement ("License") with AGH Leasing, L.P.
("Licensee") for the Hampton Inn hotel located at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇ (Richmond-Airport), Virginia (the "Hotel")
Gentlemen:
Promus Hotels, Inc. ("Promus") is about to enter into the License with the
Licensee regarding the development and operation of the Hotel. It is my
understanding that you, have entered or are about to enter into a loan with
American General Hospitality Group, Inc. ("Borrower") and the loan will be
secured by a first mortgage on the Hotel which Borrower has leased to Licensee.
The Licensee has requested that Promus issue this letter relative to the
License.
1. Promus will use its best efforts to send you copies of any default
notices that it issues under the License so long as your first
mortgage on the Hotel is still in effect. You will have the right but
not the responsibility to cure or cause to be cured any default(s)
within thirty (30) days from the date of the notice. For a non-
monetary default that is not capable of being cured within the 30-day
period, Promus may, at its reasonable discretion, grant an extension
of the cure period provided you have commenced and are diligently
proceeding in good faith with the curing of such default(s). Failure
to cure such default(s) within such period or the termination of the
License shall not prevent you from entering into a new Hampton Inn
license agreement as hereafter provided.
2. You agree to notify Promus in advance of any action that will result
in your taking possession and/or ownership of the Hotel. Such actions
may include, but are not limited to, foreclosure, deed in lieu of
foreclosure, or appointment of a receiver.
3. Within thirty (30) days after the occurrence of any of the following
events: (a) Licensee loses possession of the Hotel, (b) a court-
appointed receiver takes possession of the Hotel, (c) you commence
foreclosure proceedings or you agree to accept a deed in lieu of
foreclosure on the Hotel, or (d) Licensee seeks relief under or action
is taken voluntarily or involuntarily under bankruptcy laws and such
actions affect the Hotel, you will notify Promus in writing (the
"Acquisition
Bank One, Texas, N.A., as Administrative Agent
Commercial Real Estate Department
▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
July 30, 1996; Page 2
Notice"), as permitted by applicable law, if you elect to obtain a new
Hampton Inn license agreement. Failure to send the Acquisition Notice
means that you have waived your right to obtain a new Hampton Inn
license agreement.
4. If you (a) comply with the terms of this letter, (b) acquire legal
title and possession to the Hotel within 180 days from the date of the
Acquisition Notice, and (c) cure any default(s) capable of being cured
by you within thirty (30) days after you obtain possession of the
Hotel, Promus will issue its then current Hampton Inn license
agreement to you for a term equal to the balance of the term of
Licensee's License, without payment of the standard Hampton Inn
application fee. If the default(s) are not capable of being cured
within the 30-day period, Promus may, in its reasonable discretion,
extend such time period, provided you have commenced and are
diligently proceeding in good faith to cure such default(s). If you
send the Acquisition Notice but fail to sign the current Hampton Inn
license agreement within thirty (30) days after you obtain possession
of the Hotel (or such longer period as may be specified pursuant to
the previous sentence), you shall promptly pay Promus liquidated
damages of $50,000.
5. Neither this letter nor any Hampton Inn license agreement issued to
you pursuant to this letter is assignable. A third party that buys the
Hotel from you may apply for a Hampton Inn license. The application
will be processed according to Promus' then current requirements and
procedures.
6. While you are in possession of the Hotel, you will (a) maintain
insurance on the Hotel as specified in the then current Hampton Inn
license agreement, (b) promptly pay to Promus (or its parent or
affiliates) all fees and royalties that are specified in the then
current Hampton Inn license agreement (and reservation system
contract, etc.), and (c) comply with Promus' current policies and
procedures.
7. Licensee acknowledges that this letter was provided to you at
Licensee's request. Licensee releases Promus (its parent,
subsidiaries, affiliates and their officers and employees) and you
from any and all actions, claims, demands, costs, debts, causes and
judgments, whether in law or equity, known or unknown, arising from
the exercise of any of the rights granted hereunder by Promus and/or
you. Licensee also agrees that Promus may rely on any notice from you
pursuant to the terms of this letter without having to investigate or
ascertain the accuracy of any fact or allegation in the notice.
8. Notices to you will be given by certified mail or overnight delivery
to you at the address on page one of this letter. Notice to Promus
will be sent in the same manner and addressed as follows: Promus
Hotels, Inc., ATTN: Development Administration, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
Bank One, Texas, N.A., as Administrative Agent
Commercial Real Estate Department
▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
July 30, 1996; Page 3
Please sign the three duplicate originals and return one fully executed
original to Promus in the enclosed self-addressed envelope. You and Licensee
should each retain one original. THIS LETTER WILL AUTOMATICALLY BECOME VOID
IF ONE FULLY SIGNED ORIGINAL IS NOT RECEIVED BY PROMUS WITHIN THIRTY (30)DAYS
FROM THE DATE OF THIS LETTER.
Sincerely,
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
Development - Eastern Region
AGREED AND ACCEPTED:
AGH LEASING, L.P. BANK ONE, TEXAS, N.A.
BY: AGHL BP, INC., General Partner By:____________________________
By:______________________________ Title:_________________________
Title:___________________________ Date:__________________________
Date:____________________________ Loan #:________________________
[LETTERHEAD OF HILTON INNS. Inc.]
July ___, 1996
Bank One, Texas, N.A.,
as Administrative Agent
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
commercial Real Estate Lending
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
RE: TOLEDO HILTON, TOLEDO, OHIO
Ladies and Gentlemen:
Reference is made to that certain amended and restated Hilton Inns, Inc.
License Agreement (the "License Agreement") dated June 14, 1996, as assigned, by
and between Hilton Inns, Inc. ("Hilton Inns") and AGH Leasing, L.P.
("Licensee"), with respect to the Toledo Hilton ("Hotel"), located or to be
located at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇, and to the closing of a mortgage
loan ("Loan") in the aggregate principal amount of $100,000,000, dated July ___,
1996, from Bank One, Texas, N.A., as administrative agent (the bank in such
capacity and its successors and assigns are referred to herein as "Agent") under
that certain Credit Agreement (the "Credit Agreement") by and between American
General Hospitality Operating Partnership, L.P., a Delaware limited partnership,
and the banks and other financial institutions a party thereto (the "Banks"); in
regard to the Hotel and certain other hotel properties. The term "Agent" as used
herein shall also include (i) any special-purpose entity formed by the Agent and
the Banks to hold title to the Hotel, (ii) any successor administrative agent as
provided for in the Credit Agreement and (iii) any Affiliate of Agent. The term
"Affiliate" with respect to any entity means any natural person or firm,
corporation, partnership, association, trust or other entity which, directly or
indirectly, controls, is controlled by, or is under common control with, the
subject entity; a natural person or entity which has an entity as an Affiliate
under the foregoing shall also be deemed to be an Affiliate of such entity. For
purposes hereof, the term "control" shall mean the possession, directly, or
indirectly, of the power to direct or cause the direction of the management and
policies of any such entity, or the power to veto major policy decisions of any
such entity, whether through the ownership of voting securities, by contract or
otherwise.
In connection with such closing, this will set forth the agreement of the
parties in regard to the following matters:
1. Cure Period.
-----------
(a) Hilton Inns shall notify Agent in writing of any default of
Licensee under the License Agreement and Agent shall have a cure period of
thirty (30) days from the date of receipt
of such notice to cure any such default (or if such default is not curable
within said 30-day period, such additional time as is required provided Agent
commences to cure said default within such 30-day period and thereafter
diligently proceeds to cure such default) prior to any termination of the
License Agreement becoming effective pursuant to notice by Hilton Inns given in
accordance with the License Agreement. With respect to physical standards
default, diligent cure as used herein shall mean actual physical renovation work
on the property. Commencement of proceedings designed to allow Agent to assume
title to the property, without commencement of actual physical renovation work,
shall not satisfy the cure requirements set forth herein. The notice
requirements hereunder shall be satisfied by sending to Agent a copy of the
default notice sent to Licensee. Agent's 30-day cure period shall begin upon
Agent's receipt of said copy and shall run concurrently with any cure period of
Licensee. Any such notice by Hilton Inns to Agent shall be sent to the above
address for Agent, or to such other address of which Agent may notify Hilton
Inns in writing from time to time; provided, however, that only one address may
be used by Agent for such notice purposes at any one time. Any change in Agent's
address shall be submitted to Hilton Inns by hand delivery; certified mail,
return receipt requested; or overnight courier at the address for Hilton Inns
set forth in Paragraph 7 below.
(b) Notwithstanding anything to the contrary set forth above in
Paragraph 1(a), in the event of a physical standards default or any other
non-monetary default which requires possession by Agent in order to effect a
cure, Hilton Inns will not terminate the License Agreement for such additional
period of time as is reasonably required for Agent to obtain possession of the
Hotel through foreclosure or other appropriate proceedings in the nature
thereof, including any proceedings required due to any prohibition by any
process or injunction issued by any court or by reason of any action by any
court having jurisdiction of any bankruptcy or insolvency proceeding
involving Licensee, but in no event to exceed one hundred twenty (120) days,
provided that Agent (i) commences such proceedings within forty five (45) days
from the date of Agent's receipt of notice of default pursuant to Paragraph 1(a)
and diligently prosecutes such proceeding to completion, (ii) diligently cures
said default within the periods of time set forth in Paragraph 1(a) above
following Agent's possession of the Hotel and thereafter performs all
obligations of Licensee arising under the License Agreement, (iii) pays all
monetary obligations of Licensee arising under the License Agreement, and (iv)
in all other respects complies with the requirements of Paragraph 1(a) above
with respect to any other obligation of Licensee under the License Agreement. If
any such default or any subsequent default occurring during the period
contemplated by this Paragraph is of a nature that, in the sole opinion of
Hilton Inns, damages the image or reputation of Hilton Inns or the "Hilton"
name, or if Hilton Inns is required to terminate the License Agreement by court
order or action of any trustee in bankruptcy or debtor in possession of the
Hotel, which
2
shall include but not be limited to a rejection of the License Agreement by a
trustee or debtor-in-possession, or if the one hundred twenty (120) day period
set forth in Paragraph 1(b) above expires, then notwithstanding the above,
Hilton Inns may terminate the License Agreement. Provided, however, anything to
the contrary in this Paragraph 1(b) notwithstanding, should Licensee reject the
License Agreement in bankruptcy prior to the end of Agent's one hundred twenty
day-period to obtain possession of the Hotel, and should Agent subsequently
acquire possession of the Hotel and cure any non-monetary defaults within the
time periods set forth in this Paragraph 1(b), Agent shall have thirty (30) days
from the date of such acquisition to elect, by written notice to Hilton Inns, to
enter into a new license agreement for a term equal to the then remaining term
under the License Agreement under Hilton Inns' then current form, subject to any
renovation or other operational requirements which Hilton Inns may reasonably
require. Should Agent elect to enter into such new license agreement, Agent
shall execute such new license agreement within fifteen (15) business days of
its election.
2. Assumption.
----------
(a) In the event Agent becomes the owner of the Hotel, Agent shall
have the right to elect, at its sole option, at any time within thirty (30) days
after Agent becomes the owner of the Hotel, to terminate the License Agreement
effective upon thirty (30) days prior written notice to Hilton Inns. During this
election and notice period Agent shall pay all fees due Hilton Inns and its
affiliates from and after the time Agent becomes owner of the Hotel. Should
Agent elect to terminate the License Agreement in accordance with the terms of
this paragraph 2(a), Agent shall not be liable to Hilton Inns for any
cancellation or termination fees, or for any other fees incurred under the
License Agreement prior to the time Agent became owner of the Hotel.
(b) If Agent, upon becoming owner, does not elect by thirty (30) days
prior written notice to Hilton Inns, to terminate the License Agreement, then
the License Agreement shall not be cancelled or terminated and shall continue in
full force and effect. In such event it is hereby agreed that Agent and Hilton
Inns shall fully and completely recognize each other as "Licensee" and
"Licensor" respectively under the License Agreement for the balance of the term
thereof, upon all terms and conditions therein provided, so as to establish
direct privity of contract between Agent and Hilton Inns. The provisions of this
paragraph 2(b) shall be effective and self-operative without the execution of
any further instrument.
(c) If Agent shall have acquired the Hotel and failed to exercise its
right to terminate and cancel the License Agreement in accordance with paragraph
2(a), then within ten (10) business days after written request by Hilton Inns,
Agent shall execute and deliver to Hilton Inns a written instrument, in form
3
reasonably satisfactory to Hilton Inns, confirming its assumption of the License
Agreement and its agreement hereunder to perform all of the obligations of
Licensee under the License Agreement. Failure to execute and deliver to Hilton
Inns a written instrument in accordance with the provisions of this paragraph
2(c) shall be a default under the License Agreement.
3. Licensee's Obligations. Notwithstanding any assignment and assumption
----------------------
of the License Agreement, the Licensee shall not be released from any of its
obligations under the License Agreement.
4. Subsequent Sale. In the event Agent acquires the fee simple title to
---------------
the Hotel through foreclosure or deed in lieu thereof, become assignee of the
License Agreement under Paragraph 2 above, and subsequently sells, assigns or
transfers said Hotel to a third party, Hilton Inns shall not unreasonably
withhold its consent to the transfer of the License Agreement to such third
party, and upon such transfer consented to by Hilton Inns, Agent shall be
released from any liability or obligations under the License Agreement arising
subsequent to the date of such transfer.
5. Subordination. Hilton Inns hereby acknowledges and agrees that the
-------------
License Agreement, to the extent that it creates any interest in the Hotel, is
and shall be subordinate to the mortgage of Agent placed or to be placed on the
Hotel in accordance with the terms of the Loan. Hilton Inns further acknowledges
and agrees that a conveyance to Agent by foreclosure or deed in lieu of
foreclosure shall not be deemed a sale or lease of the Hotel under Paragraph
9(b) of the License Agreement.
6. Management. In the event Agent becomes owner of the Hotel, (i)
----------
notwithstanding the provisions of Paragraph 5(j) of the License Agreement, Agent
shall have the right to employ a reputable and qualified firm or person to
manage the Hotel, and (ii) Agent shall not be bound by the provisions of
Paragraph 8 of the License Agreement.
7. Execution. This Agreement shall not be binding upon Hilton Inns and
---------
shall be deemed null and void unless a fully executed counterpart original
hereof is received by Hilton Inns at the following address within ten (10)
business days of the date of the Loan closing:
Hilton Inns, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
4
8. Assignment. This Agreement may not be assigned by Agent without the
----------
written consent of Hilton Inns.
Very truly yours,
HILTON INNS, INC.
BY: /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
SR. VICE PRESIDENT MARKETING
----------------------------
(Print Name and Title)
Accepted and agreed to this ___________ day of _________________, 1996.
BANK ONE, TEXAS, N.A.,
in its capacity as administrative
agent under the Credit Agreement
By: ______________________________
______________________________
(Print Name and Title)
In consideration of the closing of the above-referenced Loan, Licensee
consents to each of the terms of the above Letter Agreement.
AGH LEASING, L.P. Dated: _______________, 1996
By: ___________________________
___________________________
(Print Name and Title)
d3979.daw
5
[LETTERHEAD OF DOUBLETREE APPEARS HERE]
July 12, ▇▇▇▇
▇▇▇▇ ▇▇▇, ▇▇▇▇▇, ▇.▇., as Administrative Agent
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
4th Floor
Commercial Real Estate Department
Dallas, TX 75201
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇
RE: License Agreement (the "LICENSE AGREEMENT") between Doubletree Hotel
Systems, Inc., ("DOUBLETREE") and AGH Leasing, L.P. ("LICENSEE") dated
_______________, in connection with the Doubletree Hotel located at ▇▇▇▇ ▇.
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (the "HOTEL).
Gentlemen:
Doubletree and Licensee have entered into the License Agreement under which
Licensee has been granted a license to operate the Hotel under the tradename
DOUBLETREE HOTEL (the "TRADENAME"). Licensee and you have advised us that you
and certain other lenders (the "Lenders") have entered, or are about to enter,
into a loan arrangement (the "LOAN") whereby your loan will be secured by a
mortgage/deed of trust on the premises on which the Hotel is situated. Licensee
and you have requested that we enter into this Letter Agreement with respect to
the parties' rights in connection with the Hotel, the License Agreement and the
Loan. This letter shall only remain in effect if you are one of the Lenders.
1. Doubletree shall give you 30 days' prior written notice of any voluntary
surrender by Licensee of the License Agreement (to the extent that Doubletree is
aware in advance of any such voluntary surrender), and Doubletree shall also
give you 30 days' prior written notice of a default and any action Doubletree
intends to take under the License Agreement as a result of any default(s) by
Licensee thereunder, provided in each instance that (a) your mortgage/deed of
trust and the License Agreement are in full force and effect at the time of the
event(s) set out above; (b) you are not in receivership or conservatorship; (c)
you have not been taken over by any state or federal regulatory agency; and (d)
neither you nor any of your institution's directors or officers have entered
into any cease and desist order or any other formal or informal written
agreement with a federal or state regulatory agency. The notice given to you
concerning Licensee's default(s) will allow you 30 days from the date thereof to
cure or cause to be cured the default(s) or such longer period as provided in
Section 2B. Doubletree may, at its option upon your written request, deliver to
you copies of any of its product quality reports and/or notices of non-payment
of fees pertaining to the Hotel.
2. A. In the event you or your nominee acquire the Hotel (including the
right to possession thereof) by foreclosure, deed in lieu of foreclosure or
otherwise, either: (a) while the License Agreement is in full force and effect,
or (b) within 60 days following the date of Doubletree's termination of the
License Agreement, then you shall have 30 days from such acquisition to elect,
by written notice to Doubletree, accompanied by a non-refundable
processing charge of $5,000.00, to obtain a new license agreement in the form
then being used (and specifying the royalty and other fees then being charged)
by Doubletree and for a term equal to the balance of the original term under
the License Agreement, except that you shall not be charged the initial fee (as
the same is described in Doubletree's then current Uniform Franchise Offering
Circular for Prospective Franchisees), provided that (i) you are not in
receivership or conservatorship; (ii) you have not been taken over by any state
or federal regulatory agency; and (iii) neither you nor any of your
institution's directors or officers have entered into any cease and desist order
or any other formal or informal written agreement with a federal or state
regulatory agency.
B. All monetary defaults under the License Agreement must be cured by you
within 30 days from the date of your election to obtain a new license agreement,
including, without limitation, payment of any monies due to Doubletree or its
affiliates. With respect to any defaults of a non-monetary nature which are not
reasonably capable of being cured within said 30-day period, you will have a
reasonable period of time in which such default(s) may be cured, including the
period of time reasonably necessary to take possession of the Hotel. A new
license agreement will not be issued to you until all defaults are cured which
are capable of being cured by you; provided that you will be able to operate the
Hotel under the terms hereof. You shall further comply with Doubletree's
then-current procedures concerning the issuance of a new license agreement.
C. In the event you acquire the Hotel as set out in paragraph 2A above,
you shall furnish Doubletree with reasonably satisfactory evidence of such
acquisition.
3. In executing this document, you acknowledge that neither Licensee nor you
have any right to assign, transfer, sell or otherwise convey the License
Agreement except if, and to the extent, expressly provided therein, and any new
license agreement that may be issued to you pursuant to the terms of this letter
shall be assignable only to the extent, if any, expressly provided therein. Your
rights under this letter are not assignable, provided the Lenders may appoint
another administrative agent. A new owner of the Hotel may apply for a new
license agreement, and such application will be processed in accordance with
Doubletree's then-current requirements and procedures.
4. By its signature below, Licensee acknowledges that this letter was provided
to you at its request in order to induce you to make the Loan, and in
consideration thereof, Licensee hereby releases Doubletree, its subsidiaries,
parents, divisions, successors, assigns, heirs and representatives, and their
respective employees, agents, officers, directors and stockholders, of and from
any and all actions, causes of action, suits, claims, demands, contingencies,
debts, accounts and judgments whatsoever, at law or in equity, whether known or
unknown, arising from the exercise by you of any of the rights granted hereunder
and the recognition and compliance with such exercise by Doubletree. It is
further acknowledged and agreed that Doubletree shall be entitled to rely upon
any written notice or request by you made pursuant to the provisions hereof
without any requirement of investigating the accuracy or authenticity of such
notice or any facts or allegations contained therein.
5. A. You agree to notify Doubletree by mail 10 days in advance of any
action to (a) commence foreclosure proceedings regarding the Hotel; and/or (b)
petition for appointment of a receiver obtain the entry of an order for
relief or take any action under federal or state bankruptcy laws or similar laws
with regard to the Hotel; and/or (c) accept a deed for the Hotel in lieu of
foreclosure; and/or (d) take ownership or possession of the Hotel in any manner.
B. You agree to notify Doubletree promptly upon: (a) any change in your
address; and/or (b) the satisfaction, cancellation, sale or assignment of your
mortgage/deed of trust.
6. It is understood and agreed that (a) the provisions of this letter are not
intended to and do not in any way alter, modify or amend, or effect Doubletree's
rights under the License Agreement with respect to the Licensee or assign any
rights thereunder, (b) Doubletree shall in no event be liable or be deemed
liable directly or indirectly, for any obligations under the Loan, (c) during
any period of time that the License Agreement is in effect or the Hotel is
otherwise being operated under the Tradename, Doubletree shall be entitled to be
paid from the revenues of the Hotel all amounts due it in connection therewith
(including, without limitation, royalty fees and marketing contributions) in a
timely manner, but in no event less frequently than monthly, (d) Doubletree's
liability to Licensee, you and/or any other party for breach of or default under
any duty, covenant, agreement, representation and/or warranty under the License
Agreement, shall not, in the aggregate, exceed that for which Doubletree would
have been liable to Licensee for breach of or default under such duty, covenant,
agreement, representation and/or warranty in the absence of this letter, (e)
subject to the rights to cure as set forth in the License Agreement and herein,
Doubletree's obligations to perform its duties under the License Agreement (and
any party's rights to use the Tradename at the Hotel) shall be conditioned upon
the performance of all material duties of the "Licensee" thereunder, (f) any
acquisition of the Hotel under paragraph 2A above shall be deemed, as between
Doubletree and Licensee only, a termination of the License Agreement by
Doubletree as a result of Licensee's default, and Doubletree may pursue all
available rights and remedies against Licensee upon such termination, but any
termination fees shall be subordinate to the Loan to the extent the payment of
such fees was subordinate to the Loan prior to the date of your acquisition of
the Hotel, (g) Doubletree shall be entitled to rely on, and to comply with any
demand or request contained in, any notice provided to it by you, and Doubletree
shall have no liability to Licensee or you arising out of any action taken by
you or Doubletree pursuant to any such notice or the terms and conditions
hereof, and (h) Doubletree's agreements contained herein are for the benefit of
you, and Licensee shall acquire no rights therefrom.
7. Doubletree hereby consents to the assignment of the License Agreement by
Licensee to American General Hospitality Operating Partnership, L.P., a Delaware
limited partnership ("Lessor") and the collateral assignment of, and granting of
a security interest in, the License Agreement by Lessor to you as security for
the loan; provided, however, that in connection with the assignment of the
-------- -------
License Agreement by Licensee to Lessor the provisions of paragraphs 6(a), (b),
(c), (d), (f), (g) and (h) shall be deemed to be incorporated by reference into
the documentation evidencing such assignment as if fully sets forth therein,
with all references to "you" contained in such sections deemed to refer to
Lessor.
8. Notices shall be addressed to Doubletree as follows:
Doubletree Hotel Systems, Inc.
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Sr. Vice President, Franchising
Notices shall be given by certified mail, return receipt requested, or by
FedEx or other express delivery service.
9. This letter constitutes an offer which shall be deemed revoked and null and
void unless the duplicate originals hereof are signed by both you and Licensee
and received by Doubletree on or before August 12, 1996. An executed copy will
be returned to you and Licensee.
10. As of the date of this letter, the License Agreement is in full force and
effect, and Doubletree has no knowledge of any defaults by Licensee thereunder.
Sincerely,
Doubletree Hotel Systems, Inc.
By: xxx
-------------------------------
Its: xxx
----------------------------
Agreed and Accepted:
AGH Leasing, LP
Licensee Lender
By: AGHL GP, Inc., General Partner
By: xxx By:___________________________
-------------------------------
Title: Executive Vice President Title:________________________
----------------------------
Date: 7/15/96 Date:_________________________
-----------------------------
Loan No.______________________
Agreed and Accepted as to Paragraph 7 only:
American General Hospitality Operating Partnership, LP
Lessor
By: AGH GP, Inc., General Partner
By: xxx
------------------------------
Title: Executive Vice President
---------------------------
Date: 7/15/96
----------------------------
EXHIBIT "O"
NOTE: NEED PARTICIPATING LESSEE BANK ACCOUNTS AND LIQUOR LICENSE COMPANY
REFERENCE FOR DOCUMENT
FORM OF
GENERAL ASSIGNMENT AND AGREEMENT
THIS GENERAL ASSIGNMENT AND AGREEMENT ("Agreement") is made as of the ____
day of JULY, 1996, by AGH LEASING, L.P., a Delaware limited partnership
("Lessee"), having an office and mailing address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇ ▇▇▇▇, in favor of
[BORROWER/GUARANTOR], a [Delaware] limited partnership ("Lessor") having an
office and mailing address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇ ▇▇▇▇.
WHEREAS, Lessor is the owner of that certain real property more
particularly described on Exhibit "A" attached hereto and incorporated herein by
reference (the "Land"), and the improvements and personal property located
thereon, consisting generally of a hotel together with a restaurant, bars,
conference rooms and related facilities (the "Hotel"). The Land and the Hotel
shall sometimes be collectively referred to herein as the "Property;"
WHEREAS, pursuant to that certain Lease Agreement (the "Lease") between
Lessor, as Lessor, and Lessee, as Lessee, dated as of even date herewith, with
respect to the Property, Lessor leased to Lessee and Lessee leased from Lessor
the Property;
WHEREAS, as a condition precedent to executing the Lease, Lessor has
required that Lessee execute this Agreement;
NOW, THEREFORE, IN CONSIDERATION of the sum of TEN AND NO/100 DOLLARS
($10.00) in hand paid by Lessor to Lessee, Lessee hereby makes certain
assignments, covenants and agreements in favour of Lessor as set forth herein.
1. Bank Accounts. Lessee represents and warrants to Lessor that all
-------------
rents, royalties, issues, profits, revenues, income, money, accounts and all
funds (collectively, "Funds") generated by or in connection with the Property,
including without limitation those generated through credit card sales and
receipts, are deposited and held in the bank accounts described on Exhibit "B"
attached hereto (the "Bank Accounts") and that Lessee has no other checking;
savings, custodian and other accounts in connection with the Property. Except as
expressly consented to in writing by Lessor (which consent Lessor can withhold
in its sole and absolute discretion), Lessee agrees not to deposit any Funds
into any checking; savings, custodian and other accounts except for the Bank
Accounts.
2. Grant of Security Interest. To secure the prompt and complete
--------------------------
performance by Lessee of its covenants and obligations set forth in the Lease,
Lessee hereby assigns, conveys, mortgages,
pledges, hypothecates, transfers, and hereby grants to Lessor a continuing lien
on and security interest in, and a right of setoff and compensation against, all
of Lessee's right, title, and interest in, to, and under, or right to acquire,
the following, whether now owned or existing or hereafter acquired or arising
out of or relating to the Property (collectively, "Collateral"):
a. All Funds on deposit in checking; savings, custodian and other
accounts, including the "Bank Accounts," related to the Property or the Hotel;
all accounts receivable; all income and revenues, including revenues from the
rental and/or leasing of suites, rooms, banquet facilities, conference and
meeting rooms and related facilities; all occupancy fees and user fees; all
revenues from the sales of food, beverages, alcoholic beverages and concessions;
all parking revenues; and all other revenues, profits, proceeds, benefits and
income of the Property from any source whatsoever generated by the Property or
arising from the use or enjoyment of all or any portion thereof;
b. All intangible property and rights relating to the Property or
the operation or development thereof, or used in connection therewith,
including, without limitation, all governmental permits and licenses (including,
without limitation, liquor licenses), grants or approval of any kind relating to
the operation, occupancy or development of the Properties, and including all of
Lessee's right, title and interest in and to (i) all leases, service contracts,
operating agreements or other agreements for the operation and/or maintenance of
the Property except for those agreements or leases described in either that
certain Assignment of Management Agreements or that certain Assignment of
Leases, Rents and Security Deposits both executed by Lessee to Lessor
contemporaneously with the execution of this Agreement, (ii) all leases of
furniture, fixtures and equipment used on or in connection with the Property and
the aforesaid property (including, but not limited to, computing, communications
and electronic equipment), all indemnities and other agreements delivered in
connection with such agreements, (iii) other than the trade names of third party
franchisors, all names under or by which the Property or the Hotel thereon may
at any time be operated or known, all rights to carry on business under such
names or any variant thereof, and all good will, trade names and trademarks
relating in any way to the Property or the Hotel and (iv) the rights, title and
interests of Lessee under that certain Pledge Agreement (the "Pledge Agreement")
with the shareholders of [INSERT LIQUOR LICENSE COMPANY NAME] (the "Liquor
License Company") and the stock powers executed in connection with the Pledge
Agreement.
c. All goods, personal property, furniture, fixtures and equipment
owned by Lessee and now or hereafter located in or on the Property and/or used
in the operation and occupancy thereof, including, without limitation, all
furniture and furnishings; and
d. All accessions to, substitutions and replacements for, and all
proceeds and claims arising on account of any damage to or taking of, the
aforesaid property or any improvements
-2-
thereon or any part thereof, including, without limitation, proceeds of
insurance policies, and all causes of action and recoveries for any loss or
diminution in the value thereof of any improvements.
Lessee agrees that Lessee shall have all of the rights and remedies of
a first priority secured party under the Uniform Commercial Code as enacted in
the State of Texas, including the right of set-off against any funds on deposit
with Lessor. All of the rights and remedies available to the Lessor under the
Uniform Commercial Code, as enacted in the State of Texas, are in addition to
any other rights of Lessor set forth in this Agreement, and the security
interest pledged, assigned and granted to the Lessor by this Agreement is not
intended in any way to limit the aforesaid rights and remedies of the Lessor.
Lessee agrees to execute all other reasonable documentation (including UCC
financing statements) necessary to effectuate the foregoing.
3. Bankruptcy of Lessee. Lessee hereby acknowledges and agrees that to
--------------------
the extent permitted by applicable law, the accounts comprising a portion of the
Collateral, including without limitation the Bank Accounts, and all Funds
(collectively, "Accounts") shall not constitute the property of Lessee or any
estate of Lessee, and, in the event of the filing of a voluntary of involuntary
bankruptcy petition with respect to Lessee, the Accounts shall not be subject to
Lessee's use during the pendency of any such proceeding and shall not constitute
cash collateral within the meaning of the federal bankruptcy laws. Lessee
further agrees that immediately upon the filing of a petition in bankruptcy with
respect to Lessee, Lessee shall consent to the entry of an order by the
appropriate court granting the Lessor such relief as may be necessary to allow
Agent, on behalf of Lessor, to possess and use freely all funds in the Accounts.
4. Disclaimer of Responsibility. This Agreement shall not operate to
----------------------------
place any responsibility, liability or obligation whatsoever upon Lessor, except
as expressly set forth herein.
5. No Waiver. Any forbearance or failure or delay by Lessor in
---------
exercising any right, power or remedy shall not preclude the further exercise
thereof, and every right, power or remedy of Lessor shall continue in full force
and effect until such right, power or remedy is specifically waived in a writing
executed by Lessor.
6. Expenses. If Lessee fails to comply with the terms of this Agreement,
--------
Lessee shall pay all reasonable attorneys' fees and expenses actually incurred
by the Lessor in connection with the enforcement of this Agreement.
7. Representations and Warranties. Lessee represents and warrants to
------------------------------
Lessor as follows:
-3-
a. Lessee is duly organized and validly existing under the laws of
the State of its organization and is duly qualified to do business in all
jurisdictions in which the Hotels are located.
b. The execution, delivery and performance by Lessee of this
Agreement (i) are within the power of Lessee, (ii) have been duly authorized by
all requisite action of Lessee, (iii) have received all necessary governmental
approvals which are applicable to Lessee, and (iv) will not violate (a) any
provision of law which is applicable to Lessee, (b) any order of any court or
agency of government which is applicable to Lessee, (c) the organizational
documents of Lessee, or (d) any indenture, agreement or any other instrument to
which Lessee is a party or by which Lessee or its property is bound, or result
in a breach of or constitute (with due notice and/or lapse of time) a default
under any such indenture, agreement or other instrument or result in the
creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of Lessee's property or assets.
c. With respect to the Lease, all restaurant leases between Lessee
and third party operators of the restaurants located at the Property, and the
Pledge Agreement, as of the date hereof:
(1) each such agreement or instrument is in full force and
effect;
(2) to best of Lessee's knowledge no default exists on the part
of Lessee under any such agreement or instrument, and to the best of
Lessee's knowledge, any other party to any such agreement or instrument;
(3) no rent or other consideration has been collected by Lessee
more than one month in advance under any such agreement or instrument;
(4) no such agreement or instrument or any interest of Lessee
has been assigned or pledged except in connection with this Agreement;
(5) to the best of Lessee' knowledge, no party to any such
agreement has any defense, set off or counterclaim against Lessee under its
respective agreement or instrument; and
(6) all rent and other consideration due to date under each such
agreement or instrument has been collected and no concession has been
granted to any party thereto in the form of a waiver, release, reduction,
discount, or other alteration of rent or other consideration due or to
become due other than as set forth in such agreements or instruments.
-4-
8. Collateral Assignment; Binding Effect. Lessor may collaterally assign
-------------------------------------
this Agreement and its rights, in whole or in part, under this Agreement as
collateral for any credit facility secured in whole or in part by the Property,
and Lessee hereby irrevocably consents and agrees to the same. Upon such
collateral assignment, this Agreement shall inure to the benefit of the lender
or lenders providing such credit facility, and upon Lessee receiving the address
of such lender or lenders, (a) Lessee shall send such lender or lenders a copy
of any notice sent by Lessee to Lessor under this Agreement, (b) such lender or
lenders shall have the right, but not the obligation, to take any action of
Lessor under this Agreement and (c) no consent on behalf of Lessor or
amendment, modification or termination of this Agreement shall be effective or
binding without the written consent of such lender or lenders and all such
actions taken without such lender or lenders consent shall be void. This
Agreement shall benefit the successors and assigns of the Lessor and shall inure
to the benefit of and bind the successors and assigns of Lessee.
9. Governing Law. THIS AGREEMENT AND ANY DEALINGS BETWEEN THE PARTIES
-------------
TO THIS AGREEMENT RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR THE
RELATIONSHIPS THAT ARE BEING ESTABLISHED HEREBY AND THEREBY SHALL BE GOVERNED
BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE OF TEXAS, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. WHERE
APPLICABLE AND EXCEPT AS OTHERWISE DEFINED HEREIN, THE TERMS HEREOF SHALL HAVE
THE MEANINGS GIVEN THEM IN THE UNIFORM COMMERCIAL CODE, AS ENACTED IN THE STATE
OF TEXAS.
10. Consent to Jurisdiction and Services of Process. Lessee hereby
-----------------------------------------------
irrevocably submits generally and unconditionally for itself and in respect of
its property to the jurisdiction of any state court, or any United States court,
sitting in the State of Texas, over any suit, action or proceeding arising out
of or relating to this Agreement or the other assignments executed by Lessee for
the benefit of Lessor. Lessee hereby irrevocably waives, to the fullest extent
permitted by law, any objection that it may now or hereafter have to the laying
of venue in any such court and any claim that any such court is an inconvenient
forum. Any such proceeding against Lessee brought in the State of Texas may be
removed to a federal court of competent jurisdiction in the State of Texas.
Lessee hereby agrees and consents that, in addition to any methods of service of
process provided for under the laws of the State of Texas, all service of
process in any such suit, action or proceeding in any state court, or any United
States federal court, sitting in the State of Texas, may be made by certified or
registered mail, return receipt requested, directed to Lessee at its address for
notice stated herein or at a subsequent address of which Lessor received actual
written notice from Lessee in accordance with this Agreement, and service so
made shall be complete within five (5) days after the same shall have been so
mailed. Nothing herein shall affect the right of Lessor to serve process
-5-
in any manner permitted by law or limit the right of Lessor to bring proceedings
against Lessee in any other court or jurisdiction.
11. Waiver of Jury Trial. THE PARTIES HERETO HEREBY IRREVOCABLY AND
--------------------
UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATING TO THIS
AGREEMENT OR THE OTHER ASSIGNMENTS EXECUTED BY LESSEE FOR THE BENEFIT OF LESSOR
OR TO ANY COUNTERCLAIM INVOLVING ANY OF THE FOREGOING.
12. Notices. All notices and demand given under this Agreement shall be
-------
in writing and shall be served by personal delivery courier service or
registered or certified mail. Any such notice shall be fully prepaid and
addressed to the party served at its address as set forth in the introduction to
this Agreement. Service of any such notice or demand so made shall be deemed
effective as of the date of actual delivery if sent by personal courier service,
or if sent by registered or certified mail, three (3) days after the date of
actual delivery as shown by the addressee's return receipt, except that service
of any notice of default provided or required by law shall, if mailed, be deemed
effective on the date of mailing.
-6-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective duly authorized representatives under seal as of
the day and year first above written.
LESSEE:
Signed, sealed and AGH LEASING, L.P.,
delivered in the presence of: a Delaware limited partnership
______________________________ By: ____________________,
Unofficial Witness its general partner
By:_________________________
______________________________ Name:_______________________
Notary Public Title:______________________
My Commission Expires:
[AFFIX NOTARIAL SEAL]
LESSOR:
Signed, sealed and _____________________________
delivered in the presence of:
______________________________ By:______________________________
Unofficial Witness Name:____________________________
______________________________ Title:___________________________
Notary Public
My Commission Expires:
[AFFIX NOTARIAL SEAL]
-7-
Exhibit "A" - Legal Description
Exhibit "B" - Bank Accounts
-8-
EXHIBIT "B"
1. Bank One, Texas, N.A. account number:______________________
2. _______________________ account number:________________________
-9-
EXHIBIT "P"
FORM OF
GROUND LESSOR'S ESTOPPEL CERTIFICATE AND AGREEMENT
The undersigned ______________________________ ("Landlord") hereby executes
this estoppel certificate and agreement (this "Certificate") in connection with
that certain Credit Agreement (the "Credit Agreement") dated as of ________,
1996, by and between AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership ("Borrower"); SOCIETE GENERALE, a French banking
corporation acting through its Southwest Agency, as Structuring Agent (the bank
in such capacity and its successors and assigns are referred to herein as
"Structuring Agent"); BANK ONE, TEXAS, N.A., a national banking association,
having its address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, as Administrative Agent (the bank in such capacity and its
successors and assigns are referred to herein as "Administrative Agent"; the
Structuring Agent and the Administrative Agent are collectively referred to
herein as the "Agents"); and the banks and other financial institutions a party
thereto (the "Banks"). Pursuant to the Credit Agreement the Banks have agreed to
make a loan (the "Loan") in the amount of $100,000,000.00 to Borrower to be
secured by a number of hotels, including among other things, the tenant's
interest in that certain lease agreement (as amended, the "Lease") stated on
Exhibit "B" attached hereto covering real property situated in ___________
County, _________, more particularly described in Exhibit "A" attached hereto
(the "Property"). __________________ ("Tenant") [, an affiliate of Borrower,] is
or will become the tenant under the Lease.
Landlord understands and acknowledges that the Banks are considering making
the Loan to Borrower which will be secured by certain security instruments
(collectively the "Security Documents"), including without limitation, a [Deed
of Trust/Mortgage], Security Agreement, Assignment of Rents and Financing
Statement covering the tenant's interest in the Lease, and as a condition to
making the Loan, the Banks have required Landlord to make the certifications,
warranties and representations to and agreements with the Banks set forth
hereinbelow; and
Landlord is willing to make such certifications, warranties,
representations and agreements set forth below; and
In consideration of the foregoing and the sum of Ten Dollars ($10.00) paid
by Tenant to Landlord, the receipt and sufficiency of which is hereby
acknowledged, Landlord hereby certifies, warrants, and represents to and agrees
with the Agents and Banks as follows:
1. Landlord is the landlord under the Lease [and Tenant is the tenant
under the Lease]. The Lease is in full force and effect, and except as set forth
on Exhibit "B", the Lease has not been amended, modified, supplemented or
assigned in any manner. The Lease is the entire agreement between Tenant and
Landlord related to the Property. The rent and all other sums due and payable to
Landlord under the Lease have been paid through the date
of this Certificate. To the best knowledge of Landlord, the tenant under the
Lease is not in default of its obligations under the Lease and no event has
occurred and no condition exists which, with the giving of notice or the lapse
of time, or both, will constitute a default by the tenant under the Lease.
2. The undersigned hereby acknowledges (a) the Banks' recording the
Security Documents against the tenant's interest under the Lease and the
tenant's interest in the Property, (b) that any liens or security interests of
Landlord against the tenant's interest in Lease or Property are subordinate to
those granted in the Security Documents and (c) that the Banks' exercising the
Banks' rights and remedies under the Security Documents shall not constitute a
default by the tenant under the Lease.
3. Landlord agrees that no surrender (except a surrender upon the
expiration of the term of the Lease) of the Lease to Landlord, or of the
Property, or any part thereof, or any interest herein, and no termination,
amendment or modification of the Lease by Tenant shall be valid or effective,
without the prior written consent of the Agents so long as the Loan remains
outstanding.
4. The Administrative Agent shall be entitled to and shall receive from
Landlord under the Lease prompt written notice of defaults by tenant under the
Lease. The Administrative Agent shall have thirty (30) days to cure monetary
defaults and as long as the Administrative Agent reasonably requires to cure
non-monetary defaults so long as the Administrative Agent is proceeding
diligently to cure non-monetary defaults and so long as all rentals and other
sums to be paid by the tenant under the Lease are timely paid. In the event of a
default by the tenant under the Lease, other than a default in the payment of
money under the Lease (whether of rents, taxes or other sums payable), Landlord
shall not terminate the Lease without first giving to the Administrative Agent
reasonable time within which either (a) to obtain possession of the Property (by
appointment of a receiver, foreclosure or otherwise) and cure such default with
reasonable diligence, in the case of a default which is susceptible of being
cured after the Administrative Agent obtains possession of the Premises, or (b)
to institute foreclosure proceedings and complete such foreclosure with
reasonable diligence or otherwise acquire the tenant's interest under the Lease
with reasonable diligence, in the case of default which is not susceptible of
being cured by the Administrative Agent (any such noncurable default shall be
deemed to have been cured upon the completion of such foreclosure or acquisition
of the Tenant's interest in the Lease); provided, however, that the
-------- -------
Administrative Agent shall pay all rent and other sums payable under the Lease
(including, without limitation, taxes) within thirty (30) days after any such
sums become due and payable, together with interest on any past due sums from
the due date at the rate specified in the Lease (or, if no rate is specified, at
two percent (2%) per annum above the "prime rate" announced from time to time by
the Administrative Agent).
-2-
5. The Administrative Agent may, at any time before the termination of
the Lease, pay any amount or do any act or thing required of the tenant by the
terms of the Lease, and all payments so made and all acts or things so done by
the Administrative Agent shall be as effective to prevent a forfeiture of the
rights of the tenant under the Lease as if same had been done or performed by
the tenant under the Lease rather than the Administrative Agent.
6. If the Lease is terminated prior to its expiration date, by reason of
the tenant's default or rejection of the Lease by the tenant in a bankruptcy
case or for any other reason. Landlord will enter into a new lease of the
Property with the nominee of the Administrative Agent for the remainder of the
term of the Lease, at the rent and additional rent and upon all of the
covenants, agreements, terms, provisions and limitations contained in the Lease
if the Administrative Agent requests such a new lease within sixty (60) days
after the date of termination of the Lease and if all sums then due to the
Landlord under the Lease, including interest at the rate specified in the Lease
(or as otherwise specified herein), are paid to Landlord.
7. Any notices sent to Landlord under the Lease shall, until further
notice, be sent by registered mail and addressed as follows:
_____________________________________
_____________________________________
_____________________________________
Any notices sent to the Administrative Agent shall, until further
notice, be sent by registered mail and addressed as follows:
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Commercial Real Estate Department - ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Notices shall be effective upon deposit in the mails as aforesaid; however, the
period in which a response thereto must be given or taken shall run from the
date of receipt by the addressee. Rejection, refusal to accept delivery or
inability to deliver due to changed addresses of which no notice has been given
shall be deemed receipt.
-3-
8. This Certificate may be executed in any number of counterparts, each
of which when so executed and delivered shall be deemed to be an original and
all of which counterparts taken together shall constitute but one and the same
instrument.
9. This Certificate may not be modified except by an agreement in writing
signed by Landlord and the Administrative Agent or their respective successors
in interest. This Agreement shall inure to the benefit of the parties hereto,
the Agents, the Banks, and their successors and assigns. The rights and
obligations under this Agreement shall be appurtenant to and run with the
Property. Landlord will deliver to the Administrative Agent an estoppel
certificate in form reasonably acceptable to the Administrative Agent and
Landlord pertaining to the Lease within twenty (20) days after the
Administration Agent's request, so long as the Administrative Agent agrees to
pay Landlord's reasonable costs and expenses (including attorneys' fees)
associated therewith. Either Agent shall have the continuing right to record the
original or a copy of this Certificate in the real property records in which the
Property is located.
[10. Landlord consents to Tenant becoming the tenant under the Lease,
provided that Tenant assumes the obligations of the tenant under the Lease
arising from and after the date of the assignment.]
-4-
IN WITNESS WHEREOF, Landlord has executed this document this ______ day of
_____________, 1996.
LANDLORD:
______________________________
By:___________________________
Name:_________________________
Title:________________________
[INSERT ACKNOWLEDGMENT FORM FOR STATE IN WHICH PROPERTY IS LOCATED]
-5-
CONSENT OF LENDER
The undersigned lender ("Lender") hereby acknowledges that it is the
current holder of a mortgage lien and other liens and security interests
affecting the Property described in the attached Certificate pursuant to that
certain Deed of Trust or Mortgage dated ____________, 199_, recorded in the Real
Property Records of______________ County, ____________, under Volume ______,
Page ________ (collectively, the "Liens"), and hereby joins in the execution of
the attached Certificate for the purpose of subordinating the Liens to the terms
of the Certificate and agreeing that in the event of a foreclosure by Lender (or
its successors and assigns) on the Property, Lender (or its successors and
assigns) will take title thereto subject to the terms of the Certificate.
EXECUTED as of the ________ day of _______________, 1996.
LENDER:
_______________________________
By:____________________________
Name:__________________________
Title:_________________________
[INSERT ACKNOWLEDGMENT FORM FOR STATE IN WHICH PROPERTY IS LOCATED]
-6-
EXHIBIT "Q"
GUARANTY AND CONTRIBUTION AGREEMENT
-----------------------------------
This Guaranty and Contribution Agreement (this "Agreement") is made and
entered into effective for all purposes as of the date of the Credit Agreement
herein described, by the parties signatory hereto or to an Accession Agreement
(collectively, the "Guarantor" whether one or more), to and for the benefit of
SOCIETE GENERALE, SOUTHWEST AGENCY, as Structuring Agent, BANK ONE, TEXAS, N.A.,
as Administrative Agent, and the Banks parties to the Credit Agreement herein
described.
INTRODUCTION
A. This Agreement is given in connection with the Credit Agreement (the
"Credit Agreement") dated as of July __, 1996 among AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P., a Delaware limited partnership, as the Borrower,
Structuring Agent, Administrative Agent and the Banks.
B. The Borrower is the principal financing entity for capital
requirements of its Subsidiaries, and from time to time the Borrower has made
and will continue to make capital contributions and advances to its
Subsidiaries, including the Subsidiaries which are parties hereto. Other than
the Parent, each Guarantor is a direct or indirect subsidiary of the Borrower.
Each Guarantor will derive substantial direct and indirect benefit from the
transactions contemplated by the Credit Agreement.
C. Under the Credit Agreement, it is a condition to the making of the
Advances by the Banks and the issuance of the Letters of Credit by the Issuing
Bank that each Guarantor shall have executed and delivered this Agreement.
Therefore, in order to induce the Banks to make the Advances and the
Issuing Bank to issue its Letters of Credit, each Guarantor hereby agrees as
follows:
Section 1. Definitions. All capitalized terms not otherwise defined in this
-----------
Agreement that are defined in the Credit Agreement shall have the meaning
assigned to such terms by the Credit Agreement.
Section 2. Guaranty. Each Guarantor hereby unconditionally guarantees (a)
--------
the punctual payment when due, whether at stated maturity, by acceleration or
otherwise, of all obligations of the Borrower now or hereafter existing under
the Credit Agreement, the Notes and any other Credit Document, whether for
principal, Reimbursement Obligations, interest, fees, expenses, or otherwise and
(b) the payment and performance of the lessor's obligations under the
Participating Leases (such obligations being the "Guaranteed Obligations") and
any and all expenses (including reasonable
counsel fees and expenses) incurred by the Structuring Agent, the Administrative
Agent or any Bank in enforcing any rights under this Agreement. Each Guarantor
agrees that its guaranty obligation under this Agreement is a guarantee of
payment, not of collection and that such Guarantor is primarily liable for the
payment of the Guaranteed Obligations.
Section 3. Limit of Liability. Each Guarantor that is a Subsidiary of the
------------------
Borrower shall be liable under this Agreement with respect to the Guaranteed
Obligations only for amounts aggregating up to the largest amount that would not
render its guaranty obligation hereunder subject to avoidance under Section 548
of the United States Bankruptcy Code or any comparable provisions of any state
law.
Section 4. Guaranty Absolute. Each Guarantor guarantees that the
-----------------
Guaranteed Obligations will be paid and performed strictly in accordance with
the terms of the Credit Agreement, the other Credit Documents and the
Participating Leases, as applicable, regardless of any law, regulation, or order
now or hereafter in effect in any jurisdiction affecting any of such terms or
the rights of the Structuring Agent, the Administrative Agent, the Banks or the
Participating Lessees with respect thereto. The liability of each Guarantor
under this Agreement shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the Credit Agreement, any
other Credit Document, any Participating Lease or any other agreement or
instrument relating thereto;
(b) any change in the time, manner, or place of payment of, or in any
other term of, any of the Guaranteed Obligations, or any other amendment or
waiver of or any consent to departure from the Credit Agreement, any Credit
Document or any Participating Lease;
(c) any exchange, release, or nonperfection of any collateral, or any
release or amendment or waiver of or consent to departure from any other
agreement or guaranty, for any of the Guaranteed Obligations; or
(d) any other circumstances which might otherwise constitute a defense
available to, or a discharge of the Borrower or a Guarantor.
Section 5. Continuation and Reinstatement, Etc. Each Guarantor agrees
-----------------------------------
that, to the extent that the Borrower makes payments to the Structuring Agent,
the Administrative Agents or any Bank or the Structuring Agent, the
Administrative Agent or any Bank receives any proceeds of collateral and such
payments or proceeds or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside, or otherwise required to be repaid,
then to the extent of such
-2-
repayment the Guaranteed Obligations shall be reinstated and continued in full
force and effect as of the date such initial payment or collection of proceeds
occurred. The Guarantor shall defend and indemnify the Structuring Agent, the
Administrative Agent and each Bank from and against any claim or loss under this
Section 5 (including reasonable attorneys' fees and expenses) in the defense of
any such action or suit.
Section 6. Certain Waivers.
---------------
6.01. Notice. Each Guarantor hereby waives promptness, diligence, notice
------
of acceptance, notice of acceleration, notice of intent to accelerate and any
other notice with respect to any of the Guaranteed Obligations and this
Agreement.
6.02. Other Remedies. Each Guarantor hereby waives any requirement that
--------------
the Structuring Agent, the Administrative Agent or any Bank protect, secure,
perfect, or insure any Lien or any Property subject thereto or exhaust any right
or take any action against the Borrower or any other Person or any
collateral, including any action required by Chapter 34 of the Texas Business
and Commerce Code.
6.03. Waiver of Subrogation. (a) Each Guarantor hereby irrevocably waives,
---------------------
until payment in full of all Guaranteed Obligations and termination of all
Commitments, any claim or other rights which it may acquire against the Borrower
that arise from such Guarantor's obligations under this Agreement or any other
Credit Document, including, without limitation, any right of subrogation
(including, without limitation, any statutory rights of subrogation under
Section 509 of the Bankruptcy Code, 11 U.S.C. (S) 509, or otherwise),
reimbursement, exoneration, contribution, indemnification, or any right to
participate in any claim or remedy of the Structuring Agent, the Administrative
Agent or any Bank against the Borrower or any collateral which the Structuring
Agent, the Administrative Agent or any Bank now has or acquires. If any amount
shall be paid to any Guarantor in violation of the preceding sentence and the
Guaranteed Obligations shall not have been paid in full and all of the
Commitments terminated, such amount shall be held in trust for the benefit of
the Structuring Agent, the Administrative Agent or any Bank and shall promptly
be paid to the Administrative Agent for the benefit of Structuring Agent, the
Administrative Agent and the Banks to be applied to the Guaranteed Obligations,
whether matured or unmatured, as the Administrative Agent may elect. Each
Guarantor acknowledges that it will receive direct and indirect benefits from
the financing arrangements contemplated by the Credit Agreement and that the
waiver set forth in this Section 6.03(a) is knowingly made in contemplation of
such benefits.
(b) Each Guarantor further agrees that it will not enter into any
agreement providing, directly or indirectly, for any contribution,
reimbursement, repayment, or indemnity by the Borrower
-3-
or any other Person on account of any payment by such Guarantor to the
Structuring Agent, the Administrative Agent or the Banks under this Agreement.
6.04. California Waivers.
------------------
(a) Guarantor understands and agrees that the waivers contained in this
Section 6.04 are waivers of substantive rights and defenses to which Guarantor
might otherwise be entitled under state and federal law. The rights and defenses
waived include, without limitation, those provided by California laws of
suretyship and guaranty, antideficiency laws, and the Uniform Commercial Code.
Guarantor acknowledges that Guarantor has provided these waivers of rights and
defenses with the intention that they be fully relied upon by the Banks and/or
Agents.
(b) Guarantor waives Guarantor's rights of subrogation, reimbursement,
indemnity and contribution, and any other rights and defenses available to
Guarantor by reason of Section 2787 to 2855, inclusive, of the California Civil
Code, as amended or recodified from time to time, including without limitation
(i) any defenses Guarantor may have to the Guaranteed Obligations by reason of
an election of remedies by the Banks and/or Agents, and (ii) any rights or
defenses Guarantor may have by reason of protection afforded to Borrower with
respect to the Guaranteed Obligations pursuant to the antideficiency or other
laws of the State of California limiting or discharging Borrower's indebtedness,
including, without limitation, Section 580a, 580b, 580d, or 726 of the
California Code of Civil Procedure, as amended or recodified from time to time.
(c) If and to the extent such waivers of Guarantor's rights of
subrogation, reimbursement, indemnity and contribution, and any other rights and
defenses waived by Guarantor hereunder are unenforceable, Guarantor hereby
agrees that all such rights shall be junior and subordinate to the rights of the
Banks and/or Agents to obtain payment and performance of the Guaranteed
Obligations and to all rights of the Banks and/or Agents in and to any property,
including the Property, which now or hereafter serves as collateral security for
the Guaranteed Obligations.
(d) The above waivers include, but are not limited to, the waiver by
Guarantor of:
(i) all rights and defenses arising out of an election of remedies
by the Banks and/or Agents, even though that election of remedies, such as
a nonjudicial foreclosure with respect to security for the Guaranteed
Obligations, has destroyed Guarantor's rights or subrogation and/or
reimbursement against Borrower by the operation of Section 580d of the
California Code of Civil Procedure or otherwise;
-4-
(ii) all rights and protections of any kind which Guarantor may
have for any reason which would affect or limit the amount of any recovery
by the Banks and/or Agents from Guarantor following a nonjudicial or
judicial foreclosure of any security for the Guaranteed Obligations,
including, without limitation, the right to any fair market value hearing
pursuant to Section 580a of the California Code of Civil Procedure.
(iii) any and all benefits available to sureties and creditors which
might otherwise be available to Guarantor under California Civil Code
Sections 2809 (reduction of surety's obligation where larger than
principal's), 2810 (liability of surety when principal is not liable), 2815
(revocation of continuing guaranty), 2819 (exoneration of surety), 2839
(performance of principal obligation or offer of performance), 2845
(requiring creditor to proceed against principal), 2849 (security for
performance of principal obligation), 2850 (hypothecation of surety's
property), 2899 (order of resort to property), and 3433 (creditor's
entitlement to satisfy claim from several funds), as amended or recodified
from time to time.
(iv) all rights which Guarantor may have under any law which may
prohibit the Banks and/or Agents from enforcing its rights and remedies
against Guarantor by both a private trustee's sale and an action in court
or any law which requires that a court action to enforce the Bank's and/or
Agents' rights be an action to foreclose the Deed of Trust, including
without limitation, waivers of the benefit of California Code of Civil
Procedure Sections 564 (cases in which appointment of receiver is
authorized) and 726.5 (right of election by secured lender where security
is environmentally impaired), and California Civil Code Section 2929.5 (the
lender's inspection of real property security), as amended or recodified
from time to time; and
(e) Guarantor shall not be discharged, released or exonerated, in any
way, from its absolute, unconditional and independent liabilities hereunder,
even though any rights or defenses which Guarantor may have against Borrower,
the Banks, the Agents or others may be destroyed, diminished or otherwise
affected, by:
(i) Any declaration by the Banks and/or Agents of a default in
respect of any of the Guaranteed Obligations;
(ii) The exercise by the Banks and/or Agents of any rights or
remedies against Borrower or any other person;
(iii) The failure of the Banks and/or Agents to exercise any rights
or remedies against Borrower or any other person; or
-5-
(iv) The sale or enforcement of, or realization upon (through
judicial foreclosure, power of sale or any other means) any security for
any of the Guaranteed Obligations, even though (A) recourse may not
thereafter be had against Borrower for any deficiency or (B) the Banks
and/or Agents fail to pursue any such recourse which might otherwise be
available, whether by way of deficiency judgment following judicial
foreclosure, or otherwise.
Section 7. Representations and Warranties. Each Guarantor hereby
------------------------------
represents and warrants as follows:
7.01. Corporate Authority. Such Guarantor is either a corporation, limited
-------------------
liability company or limited partnership duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization. The
execution, delivery and performance by such Guarantor of this Agreement are
within such Guarantor's organizational powers, have been duly authorized by all
necessary organizational action and do not contravene (a) such Guarantor's
organizational authority or (b) any law or material contractual restriction
affecting such Guarantor or its Property.
7.02. Government Approval. No authorization or approval or other action by
-------------------
and no notice to or filing with, any Governmental Authority is required for the
due execution, delivery and performance by such Guarantor of this Agreement.
7.03. Binding Obligations. This Agreement is the legal, valid and binding
-------------------
obligation of such Guarantor enforceable against such Guarantor in accordance
with its terms subject to the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium, or similar law affecting creditors' rights (whether
considered in a proceeding at law or in equity).
Section 8. Covenants. Each Guarantor will comply with all covenant
---------
provisions of Article V and Article VI of the Credit Agreement to the extent
such provisions are applicable.
8.01. Additional Covenant. As soon as possible and in any event within
-------------------
five days after the incurrence of any Indebtedness by the Parent or any
Subsidiary of the Parent other than the Obligations or the Permitted Other
Subsidiary Indebtedness, the Parent shall notify the Administrative Agent in
writing of such incurrence.
Section 9. Contribution. As a result of the transactions contemplated by
------------
the Credit Agreement, each of the Guarantors will benefit, directly and
indirectly, from the Guaranteed Obligations and in consideration thereof desire
to enter into a contribution agreement among themselves as set forth in this
Section 9 to allocate such benefits among themselves and to provide
-6-
a fair and equitable arrangement to make contributions in the event any payment
is made by any Guarantor hereunder to the Structuring Agent, the Administrative
Agent or the Banks (such payment being referred to herein as a "Contribution,"
and for purposes of this Agreement, includes any exercise of recourse by the
Administrative Agent against any Property of a Contributor designated as
collateral under any Security Document and application of proceeds of such
collateral in satisfaction of such Guarantor's obligations under this
Agreement). The Guarantors hereby agree as follows:
9.01. Calculation of Contribution. In order to provide for just and
---------------------------
equitable contribution among the Guarantors in the event any Contribution is
made by a Guarantor (a "Funding Guarantor"), such Funding Guarantor shall be
entitled to a contribution from certain other Guarantors for all payments,
damages and expenses incurred by that Funding Guarantor in discharging any of
the Guaranteed Obligations, in the manner and to the extent set forth in this
Section. The amount of any Contribution under this Agreement shall be equal to
the payment made by the Funding Guarantor to the Administrative Agent or any
other beneficiary pursuant to this Agreement and shall be determined as of the
date on which such payment is made.
9.02. Benefit Amount Defined. For purposes of this Agreement, the "Benefit
----------------------
Amount" of any Guarantor as of any date of determination shall be the net value
of the benefits to such Guarantor and all of its Subsidiaries (including any
Subsidiaries which may be Guarantors) from extensions of credit made by the
Banks to the Borrower under the Credit Agreement and the benefit of entering
into the Participating Leases; provided, that in determining the contribution
liability of any Guarantor which is a Subsidiary to its direct or indirect
parent corporation or of any Guarantor to its direct or indirect Subsidiary, the
Benefit Amount of such Subsidiary and its Subsidiaries, if any, shall be
subtracted in determining the Benefit Amount of the parent corporation. Such
benefits shall include benefits of funds constituting proceeds of Advances made
to the Borrower by the Banks which are in turn advanced or contributed by the
Borrower to such Guarantor or its Subsidiaries and benefits of Letters of Credit
issued pursuant to the Credit Agreement on behalf of, or the proceeds of which
are advanced or contributed or otherwise benefit, directly or indirectly, such
Guarantor and its Subsidiaries (collectively, the "Benefits"). In the case of
any proceeds of Advances or Benefits advanced or contributed to a Person (an
"Owned Entity") any of the equity interests of which are owned directly or
indirectly by a Guarantor, the Benefit Amount of a Guarantor with respect
thereto shall be that portion of the net value of the benefits attributable to
Advances or Benefits equal to the direct or indirect percentage ownership of
such Guarantor in its Owned Entity.
9.03. Contribution Obligation. Each Guarantor shall be liable to a Funding
-----------------------
Guarantor in an amount equal to the greater of (A) the (i) ratio of the Benefit
Amount of such Guarantor to the total amount of Guaranteed Obligations,
multiplied by (ii) the amount of Guaranteed Obligations paid by
-7-
such Funding Guarantor and (B) 95% of the excess of the fair saleable value of
the property of such Guarantor over the total liabilities of such Guarantor
(including the maximum amount reasonably expected to become due in respect of
contingent liabilities) determined as of the date on which the payment made by a
Funding Guarantor is deemed made for purposes of this Agreement (giving effect
to all payments made by other Funding Guarantors as of such date in a manner to
maximize the amount of such contributions).
9.04. Allocation. In the event that at any time there exists more than one
----------
Funding Guarantor with respect to any Contribution (in any such case, the
"Applicable Contribution"), then payment from other Guarantors pursuant to this
Agreement shall be allocated among such Funding Guarantors in proportion to the
total amount of the Contribution made for or on account of the Borrower by each
such Funding Guarantor pursuant to the Applicable Contribution. In the event
that at any time any Guarantor pays an amount under this Agreement in excess of
the amount calculated pursuant to clause (A) of Subsection 9.03 above, that
Guarantor shall be deemed to be a Funding Guarantor to the extent of such excess
and shall be entitled to contribution from the other Guarantors in accordance
with the provisions of this Section.
9.05. Subsidiary Payment. The amount of contribution payable under this
------------------
Section by any Guarantor shall be reduced by the amount of any contribution paid
hereunder by a Subsidiary of such Guarantor.
9.06. Equitable Allocation. If as a result of any reorganization,
--------------------
recapitalization, or other corporate change in the Borrower or any of its
Subsidiaries, or as a result of any amendment, waiver or modification of the
terms and conditions of other Sections of this Agreement or the Guaranteed
Obligations, or for any other reason, the contributions under this Section
become inequitable as among the Guarantors, the Guarantors shall promptly modify
and amend this Section to provide for an equitable allocation of contributions.
Any of the foregoing modifications and amendments shall be in writing and signed
by all Guarantors.
9.07. Asset of Party to Which Contribution is Owing. The Guarantors
---------------------------------------------
acknowledge that the right to contribution hereunder shall constitute an asset
in favor of the Guarantor to which such contribution is owing.
9.08. Subordination. No payments payable by a Guarantor pursuant to the
-------------
terms of this Section 9 shall be paid until all amounts then due and payable by
the Borrower to any Bank, pursuant to the terms of the Credit Documents, are
paid in full in cash. Nothing contained in this Section 9 shall affect the
obligations of any Guarantor to any Bank under the Credit Agreement or any other
Credit Documents.
-8-
Section 10 Miscellaneous.
-------------
10.01. Addresses for Notices. All notices and other communications provided
---------------------
for hereunder shall be in writing, including telegraphic communication and
delivered or teletransmitted to the Administrative Agent, as set forth in the
Credit Agreement and to each Guarantor, at the address set forth beside such
Guarantor's signature hereto or in the Accession Agreement executed by such
Guarantor, or to such other address as shall be designated by any Guarantor or
the Administrative Agent in written notice to the other parties. All such
notices and other communications shall be effective when delivered or
teletransmitted to the above addresses.
10.02. Amendments, Etc. No waiver of any provision of this Agreement nor
----------------
consent to any departure by any Guarantor therefrom shall be effective unless
the same shall be in writing and signed by the Administrative Agent, the
Majority Banks and the Borrower and no amendment of this Agreement shall be
effective unless the same shall be in writing and signed by each Guarantor and
the Administrative Agent, with the consent of the Majority Banks; provided that
--------
any amendment or waiver releasing any Guarantor from any liability hereunder
shall be signed by all the Banks; and provided further that any waiver or
----------------
consent shall be effective only in the specific instance and for the specific
purpose for which given. Notwithstanding the foregoing, in the event that any
Subsidiary or Affiliate of the Borrower hereafter is required in a accordance
with the terms of the Credit Agreement or otherwise agrees to become a guarantor
of the Borrower's obligations under the Credit Documents, then such Subsidiary
or Affiliate may become a party to this Agreement by executing an Accession
Agreement ("Accession Agreement") in the form attached hereto as Annex 1 and
-------
each Guarantor and the Administrative Agent hereby agrees that upon such
Subsidiary's or Affiliate's execution of such Accession Agreement, this
Agreement shall be deemed to have been amended to make such Person a Guarantor
hereunder for all purposes and a party hereto and no signature is required on
behalf of the other Guarantors or the Administrative Agent to make such an
amendment to this Agreement effective.
10.03. No Waiver; Remedies. No failure on the part of Structuring Agent,
-------------------
the Administrative Agent or any Bank to exercise, and no delay in exercising,
any right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
10.04 Right of Set-Off. Upon the occurrence and during the continuance of
----------------
any Event of Default, the Structuring Agent, the Administrative Agent and the
Banks are hereby authorized at any time, to the fullest extent permitted by law,
to set off and apply any deposits (general or special, time or demand,
provisional or final) and other indebtedness owing by the Structuring Agent, the
-9-
Administrative Agent or the Banks to the account of any Guarantor against any
and all of the obligations of such Guarantor under this Agreement, irrespective
of whether or not the Structuring Agent, the Administrative Agent or the Banks
shall have made any demand under this Agreement and although such obligations
may be contingent and unmatured. The Structuring Agent, the Administrative Agent
and the Banks agree promptly to notify each Guarantor affected by any such set-
off after any such set-off and application made by the Structuring Agent, the
Administrative Agent or the Banks provided that the failure to give such notice
shall not affect the validity of such set-off and application. The rights of the
Structuring Agent, the Administrative Agent and the Banks under this Section
10.04 are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which the Structuring Agent, the
Administrative Agent and the Banks may have.
10.05. Continuing Guaranty: Transfer of Interest. This Agreement shall
-----------------------------------------
create a continuing guaranty and shall (a) remain in full force and effect until
payment in full and termination of the Guaranteed Obligations, (b) be binding
upon each Guarantor, its successors and assigns, and (c) inure, together with
the rights and remedies of the Administrative Agent hereunder, to the benefit of
the Structuring Agent, the Administrative Agent, the Banks and their respective
successors, transferees and assigns. Without limiting the generality of the
foregoing clause, when any Bank assigns or otherwise transfers any interest held
by it under the Credit Agreement or other Credit Document to any other Person
pursuant to the terms of the Credit Agreement or other Credit Document, that
other Person shall thereupon become vested with all the benefits held by such
Bank under this Agreement. Upon the payment in full and termination of the
Guaranteed Obligations, the guaranties granted hereby shall terminate and all
rights hereunder shall revert to each Guarantor to the extent such rights have
not been applied pursuant to the terms hereof. Upon any such termination, the
Administrative Agent will, at each Guarantor's expense, execute and deliver to
such Guarantor such documents as such Guarantor shall reasonably request and
take any other actions reasonably requested to evidence or effect such
termination.
10.06. Governing Law. This Agreement shall be governed by and construed
-------------
and enforced in accordance with, the laws of the State of Texas. Each Guarantor
hereby irrevocably submits to the jurisdiction of any Texas state or federal
court sitting in Dallas, Texas in any action or proceeding arising out of or
relating to this Agreement and the other Credit Documents and such Guarantor
hereby irrevocably agrees that all claims in respect of such action or
proceeding may be heard and determined in such court. Each Guarantor hereby
irrevocably waives, to the fullest extent it may effectively do so, any right it
may have to the defense of an inconvenient forum to the maintenance of such
action or proceeding. Each Guarantor hereby agrees that service of copies of the
summons and complaint and any other process which may be served in any such
action or proceeding may be made by mailing or delivering a copy of such process
to such Guarantor at its
-10-
address specified below. Each Guarantor agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Section shall affect the rights of any Bank, the Structuring
Agent or the Administrative Agent to serve legal process in any other manner
permitted by the law or affect the right of any Bank, the Structuring Agent or
the Administrative Agent to bring any action or proceeding against any Guarantor
or its Property in the courts of any other jurisdiction.
SECTION 10.07. WAIVERS OF JURY TRIAL. THE GUARANTORS HEREBY IRREVOCABLY
---------------------
AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATING TO THIS
AGREEMENT OR THE NOTES OR ANY OTHER CREDIT DOCUMENT OR TO ANY COUNTERCLAIM
THEREIN.
SECTION 10.08. ENTIRE AGREEMENT. PURSUANT TO SECTION 26.02 OF THE TEXAS
----------------
BUSINESS AND COMMERCE CODE, A LOAN AGREEMENT IN WHICH THE AMOUNT INVOLVED IN THE
LOAN AGREEMENT EXCEEDS $50,000 IN VALUE IS NOT ENFORCEABLE UNLESS THE LOAN
AGREEMENT IS IN WRITING AND SIGNED BY THE PARTY TO BE BOUND OR THAT PARTY'S
AUTHORIZED REPRESENTATIVE.
THE RIGHTS AND OBLIGATIONS OF THE PARTIES TO AN AGREEMENT SUBJECT TO THE
PRECEDING PARAGRAPH SHALL BE DETERMINED SOLELY FROM THE WRITTEN LOAN AGREEMENT
AND ANY PRIOR ORAL AGREEMENTS BETWEEN THE PARTIES ARE SUPERSEDED BY AND MERGED
INTO THE LOAN AGREEMENT. THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS, AS
DEFINED IN THIS AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
-11-
Each Guarantor has caused this Agreement to be duly executed as of the date
first above written.
GUARANTORS:
AMERICAN GENERAL HOSPITALITY
CORPORATION, a Maryland corporation
By:__________________________________________
Name:________________________________________
Title:_______________________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
AGH UPREIT, LLC, a Delaware limited liability
company
By: American General Hospitality
Corporation, member
By:_____________________________________
Name:___________________________________
Title:__________________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-12-
3100 GLENDALE JOINT VENTURE,
an Ohio general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc., its general
partner
By:___________________________
Name:_________________________
Title:________________________
By: American General Hospitality
Operating Partnership, L.P., its
partner
By: AGH GP, Inc., general partner
By:________________________________
Name:______________________________
Title:_____________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-13-
MDV LIMITED PARTNERSHIP,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:___________________________
Name:_________________________
Title:________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-14-
MADISON MOTEL ASSOCIATES,
a Wisconsin general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc., its general
partner
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., its
partner
By: AGH GP, Inc., general partner
By:___________________________
Name:_________________________
Title:________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-15-
183 HOTEL ASSOCIATES, LTD.,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:___________________________
Name:_________________________
Title:________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-▇▇-
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ASSOCIATES, LTD.,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:________________________________
Name:______________________________
Title:_____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:___________________________
Name:_________________________
Title:________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-17-
2929 ▇▇▇▇▇▇▇▇ LIMITED LIABILITY COMPANY, a
Delaware limited liability company
By: AGH UPREIT, LLC
By: American General Hospitality
Corporation, member
By:___________________________________
Name:_________________________________
Title:________________________________
By: American General Hospitality Operating
Partnership, L.P., member
By: AGH GP, Inc., general partner
By:___________________________________
Name:_________________________________
Title:________________________________
By: American General Hospitality Operating
Partnership, L.P., its member
By: AGH GP, Inc., general partner
By:______________________________
Name:____________________________
Title:___________________________
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-18-
ANNEX 1
to Guaranty and Contribution Agreement
ACCESSION AGREEMENT
____________________ [NAME OF ENTITY], a ______________ [limited
partnership/corporation] (the "Company"), hereby agrees with (i) BANK ONE,
TEXAS, N.A., as Administrative Agent (the "Agent") under the Credit Agreement
dated as of _______ __, 1996 among AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P., a Delaware limited partnership, as the Borrower, SOCIETE
GENERALE, SOUTHWEST AGENCY, as Structuring Agent, BANK ONE, TEXAS, N.A., as
Administrative Agent, and the Banks (as such agreement is amended from time to
time in accordance with its terms, the "Credit Agreement", capitalized terms
used herein and not otherwise defined having the meanings set forth therein),
(ii) the parties to the Environmental Indemnity Agreement (the "Environmental
Indemnity Agreement") dated as of ___________ __, 1996 executed in connection
with the Credit Agreement, and (iii) the parties to the Guaranty and
Contribution Agreement (the "Guaranty") dated as of __________ __, 1996 executed
in connection with the Credit Agreement, as follows:
The Company hereby agrees and confirms that, as of the date hereof, it (a)
intends to be a party to the Environmental Indemnity Agreement and the Guaranty
and undertakes to perform all the obligations expressed therein, respectively,
of an Indemnitor and a Guarantor (as defined in the Environmental Indemnity
Agreement and the Guaranty, respectively), (b) agrees to be bound by all of the
provisions of the Environmental Indemnity Agreement and the Guaranty as if it
had been an original party to such agreements, and (c) confirms that the
representations and warranties set forth in the Environmental Indemnity
Agreement and the Guaranty, respectively, with respect to the Company, a party
thereto, are true and correct in all material respects as of the date of this
Accession Agreement.
For purposes of notices under the Environmental Indemnity Agreement and the
Guaranty the address for the Company is as follows:
____________________________
____________________________
Attention:________________________
Telephone:________________________
Telecopy:_________________________
This Accession Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
IN WITNESS WHEREOF this Accession Agreement was executed and delivered as
of the ____ day of ______________, 19__.
[NAME OF ENTITY]
________________________________________
By:_____________________________________
Title:__________________________________
EXHIBIT "R"
IRREVOCABLE DIRECTION TO PAY RENT
TO:
AGH Leasing, L.P.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇
This Irrevocable Direction to Pay Rent (this "Direction") is made and
entered into effective for all purposes as of the 31st day of July, 1996, by the
parties signatory hereto or to an Accession Agreement (collectively, the
"Lessor" whether one or more).
AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a Delaware
limited partnership ("Borrower"); SOCIETE GENERALE, a French banking corporation
acting through its Southwest Agency, as Structuring Agent (the bank in such
capacity and its successors and assigns are referred to herein as "Structuring
Agent"); BANK ONE, TEXAS, N.A., a national banking association, having its
address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ Department, Dallas, Texas
75201, as Administrative Agent (the bank in such capacity and its successors and
assigns are referred to herein as "Administrative Agent"; the Structuring Agent
and the Administrative Agent are collectively referred to herein as the
"Agents"); and the banks and other financial institutions a party thereto (the
"Banks") have entered into a Credit Agreement dated as of July 31, 1996 (as
amended or otherwise modified from time to time, the "Credit Agreement")
pursuant to which the Banks have agreed to provide a credit facility ("Credit
Facility") in an amount of up to $100,000,000.00 to Borrower.
Pursuant to those certain Lease Agreements between Lessor, as lessor, and
AGH Leasing, L.P., a Delaware limited partnership ("Lessee"), as lessee, dated
as of even date herewith and more particularly described on Exhibit "A" attached
hereto and incorporated herein by reference (the "Leases"), Lessor leased to
Lessee and Lessee leased from Lessor the property described in such Leases.
Lessor is executing this Direction in consideration for and as a condition
precedent to the Bank's making the Credit Facility to Borrower. Lessee is
executing the Acknowledgment to this Direction in consideration for and in
connection with the Leases.
All capitalized terms not otherwise defined in this instrument shall have
the meaning assigned to such terms by the Credit Agreement.
AGH Leasing, L.P.
July 30, 1996
Page 2
In consideration of the foregoing, you are hereby authorized and directed
to pay all lease rentals due under the Leases ("Rental Payments"), as follows:
1. Commencing on the date hereof, and until such time as the Obligations
due and owing under the Credit Agreement and all of the Credit
Documents have been fully performed or satisfied pay Rental Payments
to BANK ONE, TEXAS, N.A., Account No. 1892347897 (in the name of
Borrower).
2. This Direction is irrevocable and shall remain in full force and
effect until the Obligations due and owing under the Credit Agreement
and all of the Credit Documents have been fully performed or
satisfied.
3. Payment of the Rental Payments as provided in Paragraph 1 hereof to
the foregoing account shall be deemed payment to Lessor, as lessor
under the Leases, and to the extent so paid shall satisfy your
obligation to pay rent under the Leases. All payments of Rental
Payments into the account described in Paragraph 1 under Leases in
which the lessor is a Lessor other than Borrower shall be deemed for
the account of the applicable Lessor notwithstanding that the account
may be in the name of Borrower, and Borrower shall be deemed to be
acting as such Lessor's agent with respect to such payments.
LESSORS:
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P.
By: AGH GP, Inc., its general partner
By:___________________________________
Name:____________________________
Title:___________________________
-2-
AGH Leasing, L.P.
July 30, 1996
Page 3
3100 GLENDALE JOINT VENTURE,
an Ohio general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:_______________________________
Name:_____________________________
Title:____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc., its general
partner
By:__________________________
Name:________________________
Title:_______________________
By: American General Hospitality Operating
Partnership, L.P., its partner
By: AGH GP, Inc., general partner
By:_______________________________
Name:_____________________________
Title:____________________________
-3-
AGH Leasing, L.P.
July 30, 1996
Page 4
MDV LIMITED PARTNERSHIP,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:_______________________________
Name:_____________________________
Title:____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:__________________________
Name:________________________
Title:_______________________
-4-
AGH Leasing, L.P.
July 30, 1996
Page 5
MADISON MOTEL ASSOCIATES,
a Wisconsin general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:____________________________________
Name:__________________________________
Title:_________________________________
By: American General Hospitality
Operating Partnership, L.P., its
Partner
By: AGH GP, Inc., general partner
By:_______________________________
Name:_____________________________
Title:____________________________
By: American General Hospitality Operating
Partnership, L.P., member
By: AGH GP, Inc., its general partner
By:_________________________________________
Name:_______________________________________
Title:______________________________________
-5-
AGH Leasing, L.P.
July 30, 1996
Page 6
183 HOTEL ASSOCIATES, LTD.,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:__________________________________
Name:________________________________
Title:_______________________________
By: American General Hospitality Operating
Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By:_____________________________
Name:___________________________
Title:__________________________
-6-
AGH Leasing, L.P.
July 30, 1996
Page 7
RICHMOND WILLIAMSBURG ASSOCIATES, LTD.,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality Corporation,
member
By:_____________________________________
Name:___________________________________
Title:__________________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc.,
general partner
By;________________________________
Name:______________________________
Title:_____________________________
-7-
AGH Leasing, L.P.
July 30, 1996
Page 8
2929 ▇▇▇▇▇▇▇▇ LIMITED LIABILITY COMPANY, a
Delaware limited liability company
By: AGH UPREIT, LLC
By: American General Hospitality
Corporation, member
By:_______________________________
Name:_____________________________
Title:____________________________
By: American General Hospitality
Operating Partnership, L.P., member
By: AGH GP, Inc., general partner
By:_______________________________
Name:_____________________________
Title:____________________________
By: American General Hospitality Operating
Partnership, L.P., its member
By: AGH GP, Inc., general partner
By:_________________________________
Name:_______________________________
Title:______________________________
-8-
AGH Leasing, L.P.
July 30, 1996
Page 9
Acknowledgment and Consent to the Irrevocable Direction to Pay Rent
-------------------------------------------------------------------
The undersigned hereby acknowledges the foregoing Direction, and agrees for
the benefit of the Agents and the Banks, to pay Rental Payments in the amounts
and to the account as directed above.
The undersigned further agrees to continue to make such payments until the
earlier of (i) the date on which the Leases are terminated in accordance with
their terms or (ii) the date on which the undersigned is notified by Bank One,
Texas, N.A. in its capacity as Administrative Agent for the Banks pursuant to
Credit Agreement or any successor Administrative Agent appointed pursuant to the
Credit Agreement that all Obligations due and owing under the Credit Agreement
and all of the Credit Documents have been fully performed or satisfied.
AGH LEASING, L.P.
a Delaware limited partnership
By: AGHL GP, INC.,
a Delaware corporation,
its sole general partner
By:________________________________
Name:______________________________
Title:_____________________________
WITNESS:
___________________________
___________________________
-9-
ANNEX 1
to Irrevocable Direction to Pay Rent
ACCESSION AGREEMENT
_______________ [NAME OF ENTITY], a _______________ [limited
partnership/corporation] (the "Company"), hereby agrees with the parties to the
Irrevocable Direction to Pay Rent (the "Direction") dated as of _____ ___, 1996,
as follows:
The Company hereby agrees and confirms that, as of the date hereof, it (a)
intends to be a party to the Direction, (b) agrees to be bound by all of the
provisions of the Direction as if it had been an original party to such
agreement, and (c) acknowledges that it has received and reviewed a copy of the
Direction and the Acknowledgment and Consent to the Irrevocable Direction to Pay
Rent.
For purposes of notices under the Direction the address for the Company is
as follows:
_____________________________
_____________________________
Attention:___________________
Telephone:___________________
Telecopy:____________________
This Accession Agreement shall be governed by and construed in
accordance with the laws of the State of Texas. IN WITNESS WHEREOF this
Accession Agreement was executed and delivered as of the ____ day of ________,
19__.
[NAME OF ENTITY]
_____________________________________
By:__________________________________
Title:_______________________________
Agreed to and Accepted By:
AGH LEASING L.P.,
a Delaware limited partnership
By: AGHL GP, INC.,
a Delaware corporation,
its sole general partner
By:_________________________________
Name:_______________________________
Title:______________________________
EXHIBIT "S"
LEASE/CONCESSION AGREEMENT
THIS AGREEMENT is made on the _______ day of _____________, 1996, between
AGH Leasing, L.P., a Delaware limited partnership ("Lessee"), and SDBMI, a
California corporation ("Licensee").
Whereas, Lessee has leased the hotel facility known as the Holiday Inn
Mission Valley, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
("Hotel"), from American General Hospitality Operating Partnership, L.P.
("Owner"), pursuant to that certain Lease Agreement (herein so called) dated the
same date as the date hereof; and
Whereas, Lessee has retained American General Hospitality, Inc. ("Manager")
to manage the Hotel pursuant to that certain Management Agreement (herein so
called) of today's date between Lessee and Manager; and
Whereas, in connection with the operation of the Hotel and the services to
be provided by Manager, Lessee desires that Licensee operate a concession for
the sale of alcoholic beverages at the Hotel and Manager has agreed to provide
the personnel and management necessary for the operation of the alcoholic
beverage sales which are attendant to the management and operation of the Hotel
by Manager.
Now therefore, in consideration of the mutual covenants herein contained,
and for other good and valuable consideration as set forth herein, the parties
agree as follows:
1. Lessee grants to Licensee the right to dispense alcoholic beverages on
the premises of the Hotel under general guidelines and rules established from
time to time by Manager, on condition that all such sales shall be legally made
under valid licenses or permits therefor, and further conditioned that Licensee
shall conform to and comply with all applicable laws, ordinances, rules and
regulations of the applicable governmental or quasi-governmental authorities
having jurisdiction over the sale, service and/or dispensing of alcoholic
beverages at the Hotel ("Applicable Laws"). The rights of Licensee granted in
this section shall be subject to the terms and provisions of the Management
Agreement relating to the use and operation of the Hotel, and Licensee
acknowledges that it has received and reviewed a copy of the Management
Agreement.
2. Lessee will furnish, or will cause Manager to furnish, insurance,
including, as necessary, a waiver of liquor liability exclusion or specific
liquor liability coverage, so as to protect Licensee, Manager and Lessee in
regard to the concession granted herein and will as well furnish utilities,
furniture, fixtures, advertising, related bar supplies (other than alcoholic
beverages) and personnel necessary to conduct the business of dispensing
alcoholic beverages upon the premises. Licensee agrees to pay to Lessee the
following: (i) thirty percent (30%) of the gross receipts ("gross receipts"
being net however of beverage purchases, sales taxes, including penalties and
assessments, and Licensee's State and local taxes and fees, for all of
which Licensee shall be solely responsible) from the dispensing and sale of
alcoholic beverages by Licensee hereunder, payable monthly, and (ii)
reimbursement of the actual cost of supplies and services furnished by Lessee,
or by Manager as the agent of Lessee, based on a prorata formula of the costs
where joint use of the same is made, provided that, at the request of Lessee,
such payments to Lessee shall be made periodically and adjusted on a monthly
basis or upon final audit. The formula to be used in determining shared expenses
shall be the ratio between total sales of Licensee to total revenues of the
Hotel.
3. Licensee agrees to furnish such management, training and supervision
of Manager's employees as necessary to enable such personnel to transact the
actual sale of alcoholic beverages on behalf of Licensee so as to comply with
Applicable Laws. Manager agrees that, in the use of such employees by Licensee,
Licensee shall have the exclusive right and obligation to make all decisions
relating to all activities of such employees affecting the permits of Licensee
under Applicable Laws. Licensee shall have the right to terminate the
application of this Agreement to the employees of Manager upon reasonable notice
to Manager, or without notice in regard to any particular employee when such
employee violates any part of the Applicable Laws. Any activity relating to the
beverage permit of Licensee by any such employee shall remain under the
exclusive control of Licensee.
4. Licensee agrees that in the event of termination of this Agreement,
the physical assets on and about the Hotel shall remain the property of Lessee
or the Owner of the Hotel, as the case may be. The physical assets furnished by
Licensee (in particular, the alcoholic beverages) shall remain the property of
Licensee.
5. Each party is solely responsible for its own acts and activities, and
neither Lessee nor Manager shall be held liable for any acts or omissions of
Licensee in the preparation and serving of beverages. Licensee shall retain the
exclusive right to select and purchase all alcoholic beverages dispensed upon
the premises covered by the beverage permit and to establish the price of each
such item served on the licensed premises.
6. This Agreement is entered into for the mutual benefit of both parties
and for the purpose of providing a complete beverage service to the public at
the Hotel. Both parties agree to take all actions reasonably necessary to
achieve such result.
7. The term of this Agreement shall be indefinite but is subject to
termination at will by either party upon 30 days notice, provided that this
Agreement shall immediately terminate upon termination of the Lease Agreement,
or in the event that any of the stock of Licensee is transferred to or owned by
anyone other than ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (Licensee's sole shareholder). In the event of
termination hereof, the business operated hereunder by Licensee shall be
terminated in an orderly fashion, and, if required by law, all alcoholic
beverage permits and licenses issued to Licensee with respect to the Hotel shall
be surrendered to the appropriate authority for cancellation or voluntary
suspension.
-2-
8. The terms of this Agreement are subject and subordinate in all
respects to the terms of the Lease Agreement and any mortgage or deed of trust
encumbering the Hotel.
Dated the day and year first above written.
AGH LEASING. L.P.
By: AGHL GP., Inc., its
General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
SDBMI
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
AGREED TO:
AMERICAN GENERAL HOSPITALITY, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
-3-
EXHIBIT "T"
FORM OF
LIQUOR LICENSE COMPANY CONSENT AND AGREEMENT
--------------------------------------------
THIS LIQUOR LICENSE COMPANY CONSENT AND AGREEMENT ("Agreement"), dated as
of ___________, 1996, is executed by ___________________________, a ____________
corporation (the "Company") and AGH LEASING, L.P., a Delaware limited
partnership (the "Tenant") in connection with that certain Credit Agreement (the
"Credit Agreement") dated as of ___________, 1996, by and between AMERICAN
GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a Delaware limited partnership
("Borrower"), BANK ONE, TEXAS, N.A., a national banking association, as
administrative agent, (Bank One, Texas, N.A. and any subsequent Administrative
Agent under the Credit Agreement, are referred to hereinafter as the
"Administrative Agent"), SOCIETE GENERALE, a French banking corporation acting
through its Southwest Agency, as structuring agent (the "Structuring Agent")
(the Structuring Agent and Administrative Agent are collectively referred to
hereinafter as the "Agents"), and the banks and other lenders a party thereto
(collectively the "Banks"), pursuant to which the Banks have agreed to provide a
credit facility (the "Credit Facility") in an amount of up to $100,000,000.00 to
Borrower. All terms used, but not defined, in this Agreement shall have the
meaning given such terms in the Credit Agreement. The Credit Facility is or will
be secured by, among other things, the Initial Properties and Future Properties
(collectively, the "Properties").
Company is executing this Agreement in consideration for and in connection
with the Lease/Concession Agreement dated as of even date herewith executed with
Tenant (the "Lease/Concession Agreement"). Tenant is consenting to this
Agreement in consideration for and in connection with the Lease Agreement
between Tenant and Borrower or an affiliate of Borrower (the "Landlord") for the
use of the Improvements on the Property (as hereinafter defined). Execution and
delivery of this Agreement is a condition precedent to the Bank's making the
Credit Facility to Borrower.
1. COMPANY'S REPRESENTATIONS: Company warrants and represents to the
-------------------------
Agents and the Banks that the following are true and correct:
(a) That Company has agreed to act as liquor concessionaire for the hotel
located on the property more particularly described on Exhibit "A" attached
hereto (the "Property").
(b) That the only agreement between Tenant and Company, for the concession
of liquor is the Lease/Concession Agreement.
(c) That the Lease/Concession Agreement constitutes the valid and binding
agreement of Company, enforceable in accordance with its terms, and Company has
full authority under all state or local laws and regulations to perform all of
its obligations under said Lease/Concession Agreement.
(d) That to the best of Company's knowledge Tenant is not in default in
the performance of any of its obligations under the Lease/Concession Agreement.
2. COMPANY'S AGREEMENTS: Landlord and Tenant have advised Company that
--------------------
Borrower intends to obtain the Credit Facility from the Banks. The Credit
Facility is evidenced by, among other things, those certain Promissory Notes
dated as of the date of the Credit Agreement, executed by Borrower and payable
to the order of Banks in the aggregate original principal sum equal to the
amount of the Credit Facility (the "Notes"). Company hereby agrees to each and
every one of the following for the benefit of Agents and the Banks and as an
inducement to Banks to extend credit to Borrower pursuant to the terms of the
Credit Agreement:
(a) In the event of a default by Tenant under any term, covenant or
provision of the Lease/Concession Agreement, Company will give Administrative
Agent thirty (30) days prior written notice of such default prior to Company's
exercise of any of its rights or remedies under the Lease/Concession Agreement
or at law, and Administrative Agent shall have the right, but not the
obligation, during said thirty (30) day period to cure such default; provided,
however, that if such default cannot be reasonably cured during such thirty (30)
day period, Administrative Agent shall have such longer period as is reasonably
necessary to cure such default as long as Administrative Agent commences such
cure within thirty (30) day period. Only in the event Administrative Agent fails
to timely cure or cause to be cured any such default as provided in the
foregoing sentence shall Company have the right to terminate the
Lease/Concession Agreement. Company will deliver to Administrative Agent a copy
of all notices of termination given by Company to Tenant under the
Lease/Concession Agreement simultaneously with the delivery of any such notices
of termination to Tenant.
(b) Without the written consent of the Administrative Agent, Company will
not terminate or amend any arrangement or agreement with respect to the liquor
license for or the sale of alcoholic beverages in connection with the Property.
(c) The Lease/Concession Agreement and any and all liens, rights and
interests (whether ▇▇▇▇▇▇ or inchoate and including, without limitation, all
mechanic's and materialman's liens under applicable law) owned, claimed or held,
or to be owned, claimed or held by the Company in and to the Property and
Improvements now or hereafter constructed thereon, are and shall be in all
things subordinate and inferior to the full repayment of the Credit Facility and
the liens and security interests created or to be created for the benefit of the
Agents and the Banks, their respective successors and assigns, and securing the
repayment of the above described Notes including, without limitation, those
created under and by virtue of the Mortgage covering the Property and filed or
to be filed of record in the public records maintained for the recording of
mortgages and/or deeds of trust in the state and county in which the Property is
located (the "Records"), and all renewals and extensions hereof.
(d) Upon the occurrence of an Event of Default (as defined in the Credit
Agreement), Company shall, at the request of Administrative Agent, its
successors or assigns, continue performance on Administrative Agent's, its
successors' or assigns', behalf in accordance with the terms of the
Lease/Concession Agreement, provided that Company shall be paid all sums due or
to become due it in accordance with said Lease/Concession Agreement following
the date the Administrative Agent makes such request. Company further agrees
that upon the occurrence of
-2-
such an Event of Default, the Administrative Agent shall have the continuing
right to reject the Lease/Concession Agreement.
(e) Company will not voluntarily terminate, nor materially amend or modify
the Lease/Concession Agreement without the prior written consent of
Administrative Agent. In the event Company fails to secure such approval, the
Lease/Concession Agreement shall, for the purposes of Company's obligation
aforesaid to continue performance thereunder for Administrative Agent's benefit,
be deemed not to have been modified by such amendment.
(f) Company further agrees to (i) execute such affidavits and certificates
as Administrative Agent shall reasonably require to further evidence the
agreements herein contained, (ii) on request from Administrative Agent, furnish
Administrative Agent with copies of such information as Tenant is entitled to
receive under the Lease/Concession Agreement, and (iii) cooperate with
Administrative Agent's representatives in any inspection of the Improvements on
the Property.
(g) Administrative Agent has no obligation to Company with respect to the
Credit Facility, and Administrative Agent's obligations to Borrower and its
affiliates with respect thereto are set forth in the Credit Agreement and
certain other credit documents by and between Banks, Agents, Borrower and
Borrower's affiliates ("Credit Documents"), with respect to which the Company is
not a third party beneficiary. The relationship of Agents and Banks to Borrower
and Borrower's affiliates is one of a creditor to a debtor, and Agents and Banks
are not joint venturers or partners of Borrower or Borrower's affiliates.
(h) Company further agrees that nothing herein shall impose upon
Administrative Agent any obligation for payment or performance in favor of
Company unless Administrative Agent notifies Company in writing after an Event
of Default, that (i) Administrative Agent has elected to assert Tenant's rights
under of the Lease/Concession Agreement and (ii) Administrative Agent agrees to
pay Company the sums due Company under the terms of such Lease/Concession
Agreement.
(i) Company covenants and agrees that, upon Administrative Agent or any
other party (a "Subsequent Owner") acquiring title to the Property and
Improvements thereon either through foreclosure or by acceptance of a deed,
assignment or other conveyance in lieu thereof (collectively, "Foreclosure") or
after Foreclosure, (1) Company shall immediately deliver to a Subsequent Owner
originals of: (A) all authorizations, approvals, permits held by it in
connection with the Property and Improvements; and (B) all licenses and
agreements including, without limitation, to the extent permitted by law, all
liquor licenses obtained by Company in connection with the Property and
Improvements thereon (the items described in (A) and (B) being hereinafter
collectively referred to as the "Agreements") and Company shall, to the maximum
extent permitted by law, upon request of any Subsequent Owner, promptly transfer
to such Subsequent Owner all of such Agreements, and will cooperate with such
Subsequent Owner to effectuate a full assignment, conveyance and transfer of
such Agreements so that the smooth and continual operation of the Property and
Improvements thereon is not impaired or hindered, (2) Company shall execute such
further instruments or documents as a Subsequent Owner may reasonably require to
further effect the purposes hereof, including, without limitation, upon the
occurrence of a Foreclosure, such documents as may be necessary to vest title in
such Subsequent Owner to any liquor licenses then held by Company in
-3-
connection with the Property and Improvements thereon and (3) any Subsequent
Owner shall have the continuing right to terminate the Lease/Concession
Agreement, in whole or in part, upon no less than thirty (30) days prior written
notice to Company without any obligation to pay a termination or cancellation
fee or penalty to Company. Notwithstanding any provision contained herein to the
contrary, the obligations of Company pursuant to this Agreement shall survive
any termination of the Lease/Concession Agreement. A Subsequent Owner shall only
incur liability to Company under the Lease/Concession during such Subsequent
Owner's ownership of the Property and Improvements. Upon a sale, conveyance,
transfer or other assignment of the Property and Improvements thereon or a
termination of the Lease/Concession Agreement, a Subsequent Owner shall have no
further liability to Company under such terminated Lease/Concession Agreement
from the date of such sale, conveyance, transfer, assignment or termination. In
addition, no Subsequent Owner shall have personal liability under the
Lease/Concession Agreement or this Agreement, and Company agrees to look solely
to such Subsequent Owner's interest in the Property and Improvements thereon for
satisfaction of any sums or other obligations owed Company under the
Lease/Concession Agreement.
(j) Company hereby represents and warrants that no prior assignment of
Company's interest in the Lease/Concession Agreement has been made, and Company
agrees and covenants not to assign, sell, pledge, transfer or otherwise encumber
Company's interest in the Lease/Concession Agreement.
(k) Company has executed this Agreement for the purpose of inducing Banks
to advance sums to Borrower under the above described Notes and with full
knowledge and intent that Banks shall rely upon the representations, warranties
and agreements herein contained when making advances to Borrower, and that but
for this instrument and the representations, warranties and agreements herein
contained, Banks would not take such actions.
(l) The Administrative Agent shall have the continuing right to file a
copy of this Agreement in any of the Records without the need for further
consent of Company, Tenant or any of their respective affiliates.
3. TENANT'S CONSENT: Tenant has joined herein to evidence its consent to
----------------
all the agreements of Company contained in this Agreement.
-4-
EXECUTED this the ____ day of ____________, 1996.
TENANT:
AGH LEASING, L.P., A DELAWARE LIMITED PARTNERSHIP
By: AGHL GP, INC., a Delaware corporation, its
sole general partner
By: _________________________________________
Name:________________________________________
Title:_______________________________________
COMPANY:
_____________________________________________
By:__________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title:_______________________________________
-5-
THE STATE OF _________ (S)
(S)
COUNTY OF ____________ (S)
This instrument was acknowledged before me on the ____ day of ______, 1996
by _____________, _______________ of AGHL GP, Inc., a Delaware corporation the
sole general partner of AGH Leasing, L.P., a Delaware limited partnership on
behalf of such partnership.
_____________________________________________
Notary Public in and for the
State of ____________________________________
Name: _______________________________________
My Commission Expires: ______________________
THE STATE OF _________ (S)
(S)
COUNTY OF ____________ (S)
This instrument was acknowledged before me on the ____ day of ______, 1996,
by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, _____________ of _______________, a ________________________
corporation on behalf of said corporation.
_____________________________________________
Notary Public in and for the
State of ____________________________________
Name: _______________________________________
My Commission Expires: ______________________
-6-
EXHIBITS
--------
Exhibit "A" - Property Description
-7-
EXHIBIT "U"
FORM OF
PLEDGE AGREEMENT
This Pledge Agreement dated as of _________, 1996 ("Pledge Agreement") is
executed by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, an individual living in the State of Texas [▇▇▇▇▇
▇▇▇▇▇ FOR MADISON, WISCONSIN] (the "Pledgor") and AGH LEASING, L.P., a Delaware
limited partnership (the "Secured Party").
INTRODUCTION
A. AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a Delaware
limited partnership ("Borrower"), BANK ONE, TEXAS, N.A., a national banking
association, as administrative agent, SOCIETE GENERALE, a French banking
corporation, acting through its Southwest agency, as structuring agent, and the
banks and the other lenders a party thereto (collectively, the "Lenders"), have
entered into a Credit Agreement dated as of even date herewith (as amended,
restated or otherwise modified from time-to-time, the "Credit Agreement").
B. Pledgor is the sole shareholder of ______________________________ (the
"Liquor Company"). The Liquor Company has entered into that certain
Lease/Concession Agreement ("Concession Agreement") with the Secured Party. The
Pledgor is executing this Pledge Agreement in order to secure its obligations to
Secured Party pursuant to the Concession Agreement.
C. Pledgor understands and acknowledges that the Secured Party will be
collaterally assigning its rights under this Pledge Agreement to Borrower or an
affiliate of Borrower (the "Landlord") as security for its obligations to
Landlord pursuant to that certain Lease Agreement (the "Lease") dated as of even
date herewith by and between Secured Party and Landlord and that such rights are
being further collaterally assigned by Landlord to the Lenders as security for
Borrower's, and its affiliates', obligations under the Credit Agreement and the
other Credit Documents. The Pledgor will derive substantial benefit (both direct
and indirect) from the transactions contemplated by the Credit Agreement.
Therefore, the Pledgor hereby agrees with the Secured Party as follows:
Section 1. Definitions. All capitalized terms not otherwise defined in this
-----------
Pledge Agreement that are defined in the Credit Agreement shall have the meaning
assigned to such terms by the Credit Agreement. Any terms used in this Pledge
Agreement that are defined in the Uniform Commercial Code as adopted in the
State of Texas ("UCC") shall have the meaning assigned to those terms by the
UCC, whether specified elsewhere in this Pledge Agreement or not.
Section 2. Pledge.
------
2.1. Grant of Pledge. The Pledgor hereby pledges as security for the
---------------
obligations described in Section 3 the Pledged Collateral, as defined in Section
2.2 below to the Secured Party.
2.2. Pledged Collateral. "Pledged Collateral" shall mean all of Pledgor's
------------------
right, title, and interest in the following, whether now owned or hereafter
acquired:
(a) the shares of stock listed in the attached Schedule 2.2(a) and
all additional shares of stock of any issuer of such shares of stock issued to
Pledgor (the "Pledged Shares"), the certificates representing the Pledged
Shares, and all dividends, cash, instruments, and other property from
time-to-time received or otherwise distributed in respect of any of the Pledged
Shares (exclusive of, at the time of distribution, payments distributed on
account of taxes and allocated corporate expenses in accordance with past
practice); and
(b) all proceeds from the Pledged Collateral described in paragraph
(a) of this Section 2.2.
2.3. Delivery of Pledged Collateral. All certificates or instruments
------------------------------
representing the Pledged Collateral shall be delivered to the Secured Party and
shall be accompanied by duly executed instruments of assignment in blank in the
form attached hereto as Exhibit "A". After the occurrence and during the
continuance of a default under the Concession Agreement beyond applicable notice
and cure periods (an "Event of Default"), the Secured Party shall have the
right, upon prior written notice to the Pledgor, to transfer to or to register
in the name of the Secured Party or any of its nominees any of the Pledged
Collateral, subject to the rights specified in Section 2.4. In addition, after
the occurrence and during the continuance of an Event of Default, the Secured
Party shall have the right at any time to exchange the certificates or
instruments representing the Pledged Collateral for certificates or instruments
of smaller or larger denominations.
2.4. Rights Retained by Pledgor. Notwithstanding the pledge in Section
--------------------------
2.1, so long as no Event of Default shall have occurred and remain uncured:
(a) the Pledgor shall be entitled to receive and retain any
dividends and other distributions paid on or in respect of the Pledged
Collateral and the proceeds of any sale of the Pledged Shares and all payments
of principal and interest on loans and advances made by Pledgor to the issuer of
the Pledged Collateral;
(b) and, if an Event of Default shall have occurred and remain
uncured, until such time thereafter as such voting and other consensual rights
have been terminated pursuant to Section 6 hereof, the Pledgor shall be entitled
to exercise any voting and other consensual rights pertaining to
-2-
the Pledged Collateral for any purpose not inconsistent with the terms of this
Pledge Agreement or the Concession Agreement; provided, however, that the
-------- -------
Pledgor shall not exercise or shall refrain from exercising any such right if
such action would have a materially adverse effect on the value of the Pledged
Collateral; and
(c) at and after such time as voting and other consensual rights have been
terminated pursuant to Section 6 hereof, the Pledgor shall execute and deliver
(or cause to be executed and delivered) to the Secured Party all proxies and
other instruments as the Secured Party may reasonably request to (i) enable the
Secured Party to exercise the voting and other rights which the Pledgor is
entitled to exercise pursuant to paragraph (b) of this Section 2.4, and (ii) to
receive the dividends or other distributions and proceeds of sale of the Pledged
Shares and payments of principal and interest which the Pledgor is authorized to
receive and retain pursuant to paragraph (a) of this Section 2.4.
Section 3. Obligations Secured by Pledge. The pledge made in Section 2 above
-----------------------------
shall secure (a) all obligations of the Liquor Company now or hereafter existing
under the Concession Agreement, including any extensions, modifications,
substitutions, amendments and renewals thereof, whether for principal, interest,
fees, expenses, indemnification, or otherwise; and (b) all obligations of the
Pledgor now or hereafter existing under this Pledge Agreement. All such
obligations of the Liquor Company and the Pledgor secured hereby are referred to
as the "Secured Obligations."
Section 4. Pledgor's Representations and Warranties. The Pledgor represents and
----------------------------------------
warrants as follows:
4.1. The Pledged Shares listed on the attached Schedule 2.2(a) have been
duly authorized and validly issued and are fully paid and nonassessable.
4.2. The Pledgor is the legal and beneficial owner of the Pledged
Collateral free and clear of any lien or option, except for the security
interest created by this Pledge Agreement.
4.3. No authorization, approval, or other action by, and no notice to or
filing with, any Governmental Authority or regulatory body, that has not
occurred, is required either (i) for the pledge by the Pledgor of the
Pledged Collateral pursuant to this Pledge Agreement or for the execution,
delivery, or performance of this Pledge Agreement by the Pledgor (except to the
extent that financing statements are required under the UCC to be filed in order
to maintain a perfected security interest in that portion of the Pledged
Collateral not constituting Pledged Shares) or (ii) for the exercise by the
Secured Party of the voting or other rights provided for in this Pledge
Agreement or the remedies in respect of the Pledged Collateral pursuant to this
Pledge Agreement (except as may be required in connection with such disposition
by laws affecting the offering and sale of
-3-
securities generally or affecting the transfer of rights in and to liquor
licenses and the qualification of persons to maintain such licenses).
4.4. The Pledged Shares listed on the attached Schedule 2.2(a) constitute
all of the issued and outstanding shares of capital stock of the issuer thereof.
Section 5. Pledgor's Covenants.
-------------------
5.1. Further Assurances. The Pledgor agrees that, at the expense of the
------------------
Pledgor, the Pledgeor will promptly execute and deliver all further instruments
and documents, and take all further action, that may be reasonably necessary and
that the Secured Party may reasonably request, in order to perfect and protect
any security interest granted or purported to be granted hereby or to enable the
Secured Party to exercise and enforce its rights and remedies hereunder with
respect to any Pledged Collateral.
5.2. Transfer, Other liens, and Additional Shares. The Pledgor agrees that
--------------------------------------------
he will not (a) sell or otherwise dispose of, or grant any option with respect
to, any of the Pledged Shares or (b) create or permit to exist any lien upon or
with respect to any of the Pledged Collateral, except for the security
interest under this Pledge Agreement. The Pledgor agrees that he will (a) cause
each issuer of the Pledged Shares not to issue any capital stock or other equity
securities in addition to or in substitution for the Pledged Shares issued by
such issuer, except to the Pledgor and (b) pledge hereunder, immediately upon
its acquisition (directly or indirectly) thereof, any additional shares of
capital stock or other equity securities of an issuer of the Pledged Shares.
Section 6. Remedies upon Default. If any Event of Default shall have occurred
---------------------
and remain uncured:
6.1. UCC Remedies. To the extent permitted by law, the Secured Party may
------------
exercise in respect of the Pledged Collateral, in addition to other rights and
remedies provided for in this Pledge Agreement or otherwise available to it, all
the rights and remedies of a secured party under the UCC (whether or not the UCC
applies to the affected Pledged Collateral).
6.2. Dividends and Other Rights.
--------------------------
(a) All rights of the Pledgor to exercise the voting and other
consensual rights which they would otherwise be entitled to exercise pursuant to
Section 2.4(b) may be exercised by the Secured Party if Secured Party so elects
and gives written notice of such election to the Pledgor and all rights of the
Pledgor to receive the dividends and other distributions on or in respect of the
Pledged Shares and the proceeds of sale of the Pledged Shares and interest and
principal payments which it would otherwise be authorized to receive and retain
pursuant to Section 2.4(a) shall cease.
-4-
(b) All dividends and other distributions on or in respect of the
Pledged Shares and the proceeds of sale of the Pledged Shares and interest and
principal payments which are received by the Pledgor shall be received in trust
for the benefit of the Secured Party, shall be segregated from other funds of
the Pledgor, and shall be promptly paid over to the Secured Party as Pledged
Collateral in the same form as so received (with any necessary indorsement).
6.3. Sale of Pledged Collateral. The Secured Party may upon five days prior
--------------------------
written notice to the Pledgor sell all or part of the Pledged Collateral at
public or private sale, at any of the Secured Party's offices or elsewhere, for
cash, on credit, or for future delivery, and upon such other terms as are
commercially reasonable. The Secured Party shall not be obligated to make any
sale of the Pledged Collateral regardless of notice of sale having been given.
The Secured Party may adjourn any public or private sale from time-to-time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned.
6.4. Exempt Sale. If, in the opinion of the Secured Party there is any
-----------
question that a public or semi-public sale or distribution of any Pledged
Collateral will violate any state or federal securities law, Secured Party in
its discretion (a) may offer and sell securities privately to purchasers who
will agree to take them for investment purposes and not with a view to
distribution and who will agree to imposition of restrictive legends on the
certificates representing the security, or (b) may sell such securities in an
intrastate offering under Section 3(a)(11) of the Securities Act of 1933, as
amended, and no sale so made in good faith by Secured Party shall be deemed to
be not "commercially reasonable" solely because so made. Pledgor shall cooperate
fully with Secured Party in all reasonable respects in selling or realizing upon
all or any part of the Pledged Collateral.
6.5. Application of Collateral. Any cash held by the Secured Party as
-------------------------
Pledged Collateral and all cash proceeds received by the Secured Party from the
sale of, collection of, or other realization of any part of the Pledged
Collateral may, in the discretion of the Secured Party, be held by the Secured
Party as Pledged Collateral or applied by the Secured Party against part of the
Secured Obligations in the following order:
first, to payment of the reasonable expenses of such sale or other
-----
realization, including reasonable compensation to the Secured Party and its
agents and counsel, and all reasonable expenses, liabilities and advances
incurred or made by the Secured Party in connection therewith, and to the
ratable payment of any other unreimbursed reasonable expenses for which the
Secured Party is to be reimbursed pursuant to the Concession Agreement;
second, to the ratable payment of the Secured Obligations; and
------
-5-
third, to the ratable payment of all other amounts payable by the
-----
Liquor Company under the Concession Agreement and this Pledge Agreement.
Any surplus of such cash or cash proceeds held by the Secured Party and
remaining after payment in full of all the Secured Obligations shall be promptly
paid over to the Pledgor or to whoever may be lawfully entitled to receive such
surplus.
Section 7. Secured Party as Agent for Pledgor.
----------------------------------
7.1. Secured Party Appointed Attorney-in-Fact. The Pledgor hereby
----------------------------------------
irrevocably appoints the Secured Party the Pledgor's attorney-in-fact, with full
authority after the occurrence and during the continuance of an Event of Default
to act for the Pledgor and in the name of the Pledgor, and, in the Secured
Party's discretion, subject to the Pledgor's revocable rights specified in
Section 2.4, to take any action and to execute any instrument which the Secured
Party may deem necessary or advisable to accomplish the purposes of this Pledge
Agreement, including, without limitation, to receive, indorse, and collect all
instruments made payable to the Pledgor representing any dividend, or the
proceeds of the sale of the Pledged Shares, or other distribution in respect of
the Pledged Shares and to give full discharge for the same.
7.2. Secured Party May Perform. If the Pledgor fails to perform any
-------------------------
covenant contained herein, the Secured Party may, after sending written notice
thereof to Pledgor and 10 days to perform same, itself perform, or cause
performance of, such covenant. Pledgor shall pay for the reasonable expenses of
the Secured Party incurred in connection therewith.
7.3. Reasonable Care. The Secured Party shall be deemed to have exercised
---------------
reasonable care in the custody and preservation of the Pledged Collateral in its
possession if the Pledged Collateral is accorded treatment substantially equal
to that which the Secured Party accords its own property, it being understood
that the Secured Party shall have no responsibility for (a) ascertaining or
taking action with respect to calls, conversions, exchanges, maturities,
tenders, or other matters relative to any Pledged Collateral, whether or not the
Secured Party has or is deemed to have knowledge of such matters, or (b) taking
any necessary steps to preserve rights against any parties with respect to any
Pledged Collateral.
Section 8. Miscellaneous.
-------------
8.1 Amendments, Etc. No amendment or waiver of any provision of this Pledge
---------------
Agreement nor consent to any departure by the Pledgor herefrom shall be
effective unless made in writing and signed by the Secured Party and the
Pledgor, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
-6-
8.2. Addresses for Notices. All notices and other communications to be
---------------------
given under this Pledge Agreement by any party to another shall be in writing
and shall be delivered by telephonic facsimile, overnight air courier, personal
delivery or registered or certified U.S. Mail with return receipt requested,
postage paid, to the appropriate party at its address as follows:
To the Pledgor:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
To the Secured Party:
AGH Leasing, L.P.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Addresses for notice may be changed from time to time by written notice to all
other parties. Any communication given by mail will be effective upon the
earlier of (a) three Banking Days following deposit in a post office or other
official depository under the care and custody of the United States Postal
Service; or (b) actual receipt, as indicated by the return receipt; if given by
telephonic facsimile or telex, when sent; and if given by personal delivery or
by overnight air courier, when delivered to the appropriate address set forth
above.
8.3. Continuing Security Interest; Transfer of Interest. This Pledge
--------------------------------------------------
Agreement shall create a continuing security interest in the Pledged Collateral
and shall (a) remain in full force and effect until payment in full and
termination of the Secured Obligations, (b) be binding upon the Pledgor, his
successors and assigns, and (c) inure, together with the rights and remedies of
the Secured Party hereunder, to the benefit of and be binding upon, the Secured
Party and its respective successors, transferees, and assigns. Secured Party,
and its successors and assigns, may collaterally assign this Pledge Agreement
and its rights, in whole or in part, under this Pledge Agreement to Landlord as
collateral for Secured Party's obligations under the Lease, and Landlord can in
turn collaterally assign the same as collateral for any credit facility secured
in whole or in part by any of the
-7-
Properties, and Pledgor hereby irrevocably consents and agrees to the same. Upon
such collateral assignment: (i) this Pledge Agreement shall inure to the benefit
of the Landlord and the lender or lenders providing such credit facility, and
Pledgor shall send Landlord and such lender or lenders a copy of any notice sent
by Pledgor to Secured Party under this Pledge Agreement, and Landlord and such
lender or lenders shall have the right, but not the obligation to take any
action of Secured Party under this Pledge Agreement and (ii) no material
amendment, material modification or termination of this Pledge Agreement shall
be effective or binding without the written consent of Landlord and such lender
or lenders and all such actions taken without such consents shall be void. Upon
the payment in full and termination of the Secured Obligations, the security
interest granted hereby shall terminate and all rights to the Pledged Collateral
shall revert to the Pledgor to the extent such Pledged Collateral shall not have
been sold or otherwise applied pursuant to the terms hereof. Upon any such
termination, the Secured Party will, at the Pledgor's expense, deliver all
Pledged Collateral to the Pledgor, execute and deliver to the Pledgor such
documents as the Pledgor shall reasonably request and take any other actions
reasonably requested to evidence or effect such termination.
8.4. Choice of Law. This Pledge Agreement shall be governed by and
-------------
construed and enforced in accordance with the laws of the state of Texas, except
to the extent that the validity or perfection of the security interests
hereunder, or remedies hereunder, in respect of any particular Collateral are
governed by the laws of a jurisdiction other than the state of Texas.
-8-
The parties hereto have caused this Pledge Agreement to be duly executed as
of the date first above written.
PLEDGOR:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
________________________________________________
SECURED PARTY:
AGH LEASING, L.P., a Delaware limited partnership
By: AGHL GP, INC., a Delaware corporation, its
sole general partner
By:________________________________________
Name:______________________________________
Title:_____________________________________
-9-
SCHEDULE 2.2(a)
Attached to and forming a part of that certain Pledge Agreement dated
__________, by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, as Pledgor, to the Secured Party.
Stock Certificate Number
Stock Issuer Class of Stock No(s). Par Value of Shares
------------ -------------- ----------------- --------- ---------
EXHIBIT A
ASSIGNMENT SEPARATE FROM STOCK CERTIFICATE
FOR VALUE RECEIVED, ____________________("Assignor"), hereby sells, assigns
and transfers ________________ shares of the common stock of _________________,
a _____________ corporation (the "Corporation"), to __________________________,
all of such shares of common stock as registered in Assignor's name on the
books of the Corporation, as represented by Certificate No. ___________
herewith, and does hereby irrevocably constitute and appoint
_____________________________ as its attorney-in-fact to take any and all
actions Assignor could take if acting on its own behalf to effectuate a transfer
of such stock to the indicated assignees on the books of the Corporation with
full power of substitution in the premises, and does hereby ratify and confirm
all that such attorney-in-fact shall lawfully do by virtue hereof.
Date:___________________
[Assignor]
By:__________________________________________
Name:________________________________________
Title:_______________________________________
IN THE PRESENCE OF:
_________________________________
FORM OF
PLEDGE AGREEMENT
This Pledge Agreement dated as of _____________, 1996 ("Pledge Agreement")
is executed by [▇▇▇▇▇▇ ▇. ▇▇▇▇▇], an individual living in the [State of Texas]
(the "Pledgor") and AGH LEASING, L.P., a Delaware limited partnership (the
"Secured Party").
INTRODUCTION
A. AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a Delaware
limited partnership ("Borrower"), BANK ONE, TEXAS, N.A., a national banking
association, as administrative agent, SOCIETE GENERALE, a French banking
corporation, acting through its Southwest agency, as structuring agent, and the
banks and the other lenders a party thereto (collectively, the "Lenders"), have
entered into a Credit Agreement dated as of even date herewith (as amended,
restated or otherwise modified from time-to-time, the "Credit Agreement").
B. Pledgor is the sole shareholder of ______________________________ (the
"Liquor Company"). The Liquor Company has entered into that certain
Lease/Concession Agreement ("Concession Agreement") with the Secured Party. The
Pledgor is executing this Pledge Agreement in order to secure its obligations to
Secured Party pursuant to the Concession Agreement.
C. Pledgor understands and acknowledges that the Secured Party will be
collaterally assigning its rights under this Pledge Agreement to Borrower or an
affiliate of Borrower (the "Landlord") as security for its obligations to
Landlord pursuant to that certain Lease Agreement (the "Lease") dated as of even
date herewith by and between Secured Party and Landlord and that such rights are
being further collaterally assigned by Landlord to the Lenders as security for
Borrower's, and its affiliates', obligations under the Credit Agreement and the
other Credit Documents. The Pledgor will derive substantial benefit (both direct
and indirect) from the transactions contemplated by the Credit Agreement.
Therefore, the Pledgor hereby agrees with the Secured Party as follows:
Section 1. Definitions. All capitalized terms not otherwise defined in this
-----------
Pledge Agreement that are defined in the Credit Agreement shall have the meaning
assigned to such terms by the Credit Agreement. Any terms used in this Pledge
Agreement that are defined in the Uniform Commercial Code as adopted in the
State of Texas ("UCC") shall have the meaning assigned to those terms by the
UCC, whether specified elsewhere in this Pledge Agreement or not.
Section 2. Pledge.
------
2.1. Grant of Pledge. The Pledgor hereby pledges as security for the
---------------
obligations described in Section 3 the Pledged Collateral, as defined in Section
2.2 below to the Secured Party.
2.2. Pledged Collateral. "Pledged Collateral" shall mean all of Pledgor's
------------------
right, title, and interest in the following, whether now owned or hereafter
acquired:
(a) the shares of stock listed in the attached Schedule 2.2(a)
and all additional shares of stock of any issuer of such shares of stock issued
to Pledgor (the "Pledged Shares"), the certificates representing the Pledged
Shares, and all dividends, cash, instruments, and other property from
time-to-time received or otherwise distributed in respect of any of the Pledged
Shares (exclusive of, at the time of distribution, payments distributed on
account of taxes and allocated corporate expenses in accordance with past
practice); and
(b) all proceeds from the Pledged Collateral described in
paragraph (a) of this Section 2.2.
2.3. Delivery of Pledged Collateral. All certificates or instruments
------------------------------
representing the Pledged Collateral shall be delivered to the Secured Party and
shall be accompanied by duly executed instruments of assignment in blank in the
form attached hereto as Exhibit "A". After the occurrence and during the
continuance of a default under the Concession Agreement beyond applicable notice
and cure periods (an "Event of Default"), the Secured Party shall have the
right, upon prior written notice to the Pledgor, to transfer to or to register
in the name of the Secured Party or any of its nominees any of the Pledged
Collateral, subject to the rights specified in Section 2.4. In addition, after
the occurrence and during the continuance of an Event of Default, the Secured
Party shall have the right at any time to exchange the certificates or
instruments representing the Pledged Collateral for certificates or instruments
of smaller or larger denominations.
2.4. Rights Retained by Pledgor. Notwithstanding the pledge in Section
--------------------------
2.1, so long as no Event of Default shall have occurred and remain uncured:
(a) the Pledgor shall be entitled to receive and retain any
dividends and other distributions paid on or in respect of the Pledged
Collateral and the proceeds of any sale of the Pledged Shares and all payments
of principal and interest on loans and advances made by Pledgor to the issuer of
the Pledged Collateral;
(b) and, if an Event of Default shall have occurred and remain
uncured, until such time thereafter as such voting and other consensual rights
have been terminated pursuant to Section 6 hereof, the Pledgor shall be entitled
to exercise any voting and other consensual rights pertaining to
-2-
the Pledged Collateral for any purpose not inconsistent with the terms of this
Pledge Agreement or the Concession Agreement; provided, however, that the
-------- -------
Pledgor shall not exercise or shall refrain from exercising any such right if
such action would have a materially adverse effect on the value of the Pledged
Collateral; and
(c) at and after such time as voting and other consensual rights
have been terminated pursuant to Section 6 hereof, the Pledgor shall execute and
deliver (or cause to be executed and delivered) to the Secured Party all proxies
and other instruments as the Secured Party may reasonably request to (i) enable
the Secured Party to exercise the voting and other rights which the Pledgor is
entitled to exercise pursuant to paragraph (b) of this Section 2.4, and (ii) to
receive the dividends or other distributions and proceeds of sale of the Pledged
Shares and payments of principal and interest which the Pledgor is authorized to
receive and retain pursuant to paragraph (a) of this Section 2.4.
Section 3. Obligations Secured by Pledge. The pledge made in Section 2 above
-----------------------------
shall secure (a) all obligations of the Liquor Company now or hereafter existing
under the Concession Agreement, including any extensions, modifications,
substitutions, amendments and renewals thereof, whether for principal, interest,
fees, expenses, indemnification, or otherwise; and (b) all obligations of the
Pledgor now or hereafter existing under this Pledge Agreement. All such
obligations of the Liquor Company and the Pledgor secured hereby are referred to
as the "Secured Obligations."
Section 4. Pledgor's Representations and Warranties. The Pledgor represents and
----------------------------------------
warrants as follows:
4.1 The Pledged Shares listed on the attached Schedule 2.2(a) have been
duly authorized and validly issued and are fully paid and nonassessable.
4.2 The Pledgor is the legal and beneficial owner of the Pledged Collateral
free and clear of any lien or option, except for the security interest created
by this Pledge Agreement.
4.3 No authorization, approval, or other action by, and no notice to or
filing with, any Governmental Authority or regulatory body, that has not
occurred, is required either (i) for the pledge by the Pledgor of the Pledged
Collateral pursuant to this Pledge Agreement or for the execution, delivery, or
performance of this Pledge Agreement by the Pledgor (except to the extent that
financing statements are required under the UCC to be filed in order to maintain
a perfected security interest in that portion of the Pledged Collateral not
constituting Pledged Shares) or (ii) for the exercise by the Secured Party of
the voting or other rights provided for in this Pledge Agreement or the remedies
in respect of the Pledged Collateral pursuant to this Pledge Agreement (except
as may be required in connection with such disposition by laws affecting the
offering and sale of
-3-
securities generally or affecting the transfer of rights in and to liquor
licenses and the qualification of persons to maintain such licenses).
4.4. The Pledged Shares listed on the attached Schedule 2.2(a) constitute
all of the issued and outstanding shares of capital stock of the issuer thereof.
Section 5. Pledgor's Covenants.
-------------------
5.1. Further Assurances. The Pledgor agrees that, at the expense of the
------------------
Pledgor, the Pledgor will promptly execute and deliver all further instruments
and documents, and take all further action, that may be reasonably necessary and
that the Secured Party may reasonably request, in order to perfect and protect
any security interest granted or purported to be granted hereby or to enable the
Secured Party to exercise and enforce its rights and remedies hereunder with
respect to any Pledged Collateral.
5.2. Transfer, Other liens, and Additional Shares. The Pledgor agrees that
--------------------------------------------
he will not (a) sell or otherwise dispose of, or grant any option with respect
to, any of the Pledged Shares or (b) create or permit to exist any lien upon or
with respect to any of the Pledged Collateral, except for the security interest
under this Pledge Agreement. The Pledgor agrees that he will (a) cause each
issuer of the Pledged Shares not to issue any capital stock or other equity
securities in addition to or in substitution for the Pledged Shares issued by
such issuer, except to the Pledgor and (b) pledge hereunder, immediately upon
its acquisition (directly or indirectly) thereof, any additional shares of
capital stock or other equity securities of an issuer of the Pledged Shares.
Section 6. Remedies upon Default. If any Event of Default shall have occurred
---------------------
and remain uncured:
6.1. UCC Remedies. To the extent permitted by law, the Secured Party may
------------
exercise in respect of the Pledged Collateral, in addition to other rights and
remedies provided for in this Pledge Agreement or otherwise available to it, all
the rights and remedies of a secured party under the UCC (whether or not the UCC
applies to the affected Pledged Collateral).
6.2. Dividends and Other Rights.
--------------------------
(a) All rights of the Pledgor to exercise the voting and other
consensual rights which they would otherwise be entitled to exercise pursuant to
Section 2.4(b) may be exercised by the Secured Party if Secured Party so elects
and gives written notice of such election to the Pledgor and all rights of the
Pledgor to receive the dividends and other distributions on or in respect of the
Pledged Shares and the proceeds of sale of the Pledged Shares and interest and
principal payments which it would otherwise be authorized to received and retain
pursuant to Section 2.4(a) shall cease.
-4-
(b) All dividends and other distributions on or in respect of the
Pledged Shares and the proceeds of sale of the Pledged Shares and interest and
principal payments which are received by the Pledgor shall be received in trust
for the benefit of the Secured Party, shall be segregated from other funds of
the Pledgor, and shall be promptly paid over to the Secured Party as Pledged
Collateral in the same form as so received (with any necessary indorsement).
6.3. Sale of Pledged Collateral. The Secured Party may upon five days prior
--------------------------
written notice to Pledgor sell all or part of the Pledged Collateral at public
or private sale, at any of the Secured Party's offices or elsewhere, for cash,
on credit, or for future delivery, and upon such other terms as are commercially
reasonable. The Secured Party shall not be obligated to make any sale of the
Pledged Collateral regardless of notice of sale having been given. The Secured
Party may adjourn any public or private sale from time-to-time by announcement
at the time and place fixed therefor, any such sale may, without further notice,
be made at the time and place to which it was so adjourned.
6.4. Exempt Sale. If, in the opinion of the Secured Party there is any
-----------
question that a public or semi-public sale or distribution of any Pledged
Collateral will violate any state or federal securities law, Secured Party in
its discretion (a) may offer and sell securities privately to purchasers who
will agree to take them for investment purposes and not with a view to
distribution and who will agree to imposition of restrictive legends on the
certificates representing the security, or (b) may sell such securities in an
intrastate offering under Section 3(a)(11) of the Securities Act of 1933, as
amended, and no sale so made in good faith by Secured Party shall be deemed to
be not "commercially reasonable" solely because so made. Pledgor shall cooperate
fully with Secured Party in all reasonable respects in selling upon all or any
part of the Pledged Collateral.
6.5. Application of Collateral. Any cash held by the Secured Party as
-------------------------
Pledged Collateral and all cash proceeds received by the Secured Party from the
sale of, collection of, or other realization of any part of the Pledged
Collateral may, in the discretion of the Secured Party, be held by the Secured
Party as Pledged Collateral or applied by the Secured Party against part of the
Secured Obligations in the following order:
first, to payment of the reasonable expenses of such sale or other
-----
realization, including reasonable compensation to the Secured Party and its
agents and counsel, and all reasonable expenses, liabilities and advances
incurred or made by the Secured Party in connection therewith, and to the
ratable payment of any other unreimbursed reasonable expenses for which the
Secured Party is to be reimbursed pursuant to the Concession Agreement;
second, to the ratable payment of the Secured Obligations; and
------
-5-
third, to the ratable payment of all other amounts payable by the
-----
Liquor Company under the Concession Agreement and this Pledge Agreement.
Any surplus of such cash or cash proceeds held by the Secured Party and
remaining after payment in full of all the Secured Obligations shall be promptly
paid over to the Pledgor or to whoever may be lawfully entitled to receive such
surplus.
Section 7. Secured Party as Agent for Pledgor
----------------------------------
7.1. Secured Party Appointed Attorney-in-Fact. The Pledgor hereby
----------------------------------------
irrevocably appoints the Secured Party the Pledgor's attorney-in-fact, with full
authority after the occurrence and during the continuance of an Event of Default
to act for the Pledgor and in the name of the Pledgor, and, in the Secured
Party's discretion, subject to the Pledgor's revocable rights specified in
Section 2.4, to take any action and to execute any instrument which the Secured
Party may deem necessary or advisable to accomplish the purposes of this Pledge
Agreement, including, without limitation, to receive, indorse, and collect
all instruments made payable to the Pledgor representing any dividend, or the
proceeds of the sale of the Pledged Shares, or other distribution in respect of
the Pledged Shares and to give full discharge for the same.
7.2. Secured Party May Perform. If the Pledgor fails to perform any
-------------------------
covenant contained herein, the Secured Party may, after sending written notice
thereof to Pledgor and 10 days to perform same, itself perform, or cause
performance of, such covenant. Pledgor shall pay for the reasonable expenses of
the Secured Party incurred in connection therewith.
7.3. Reasonable Care. The Secured Party shall be deemed to have exercised
---------------
reasonable care in the custody and preservation of the Pledged Collateral in its
possession if the Pledged Collateral is accorded treatment substantially equal
to that which the Secured Party accords its own property, it being understood
that the Secured Party shall have no responsibility for (a) ascertaining or
taking action with respect to calls, conversions, exchanges, maturities,
tenders, or other matters relative to any Pledged Collateral, whether or not the
Secured Party has or is deemed to have knowledge of such matters, or (b) taking
any necessary steps to preserve rights against any parties with respect to any
Pledged Collateral.
Section 8. Miscellaneous.
-------------
8.1. Amendments, Etc. No amendment or waiver of any provision of this
---------------
Pledge Agreement nor consent to any departure by the Pledgor herefrom shall be
effective unless made in writing and signed by the Secured Party and the
Pledgor, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
-6-
8.2. Addresses for Notices. All notices and other communications to be
---------------------
given under this Pledge Agreement by any party to another shall be in writing
and shall be delivered by telephonic facsimile, overnight air courier, personal
delivery or registered or certified U.S. Mail with return receipt requested,
postage paid, to the appropriate party at its address as follows:
To the Pledgor:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
To the Secured Party:
AGH Leasing, L.P.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn. ▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Addresses for notice may be changed from time to time by written notice to all
other parties. Any communication given by mail will be effective upon the
earlier of (a) three Banking Days following deposit in a post office or other
official depository under the care and custody of the United States Postal
Service; or (b) actual receipt, as indicated by the return receipt; if given by
telephonic facsimile or telex, when sent; and if given by personal delivery or
by overnight air courier, when delivered to the appropriate address set forth
above.
8.3. Continuing Security Interest. Transfer of Interest. This Pledge
--------------------------------------------------
Agreement shall create a continuing security interest in the Pledged
Collateral and shall (a) remain in full force and effect until payment in full
and termination of the Secured Obligations, (b) be binding upon the Pledgor, his
successors and assigns, and (c) inure, together with the rights and remedies of
the Secured Party hereunder, to the benefit of and be binding upon, the Secured
Party and its respective successors, transferees, and assigns. Secured Party,
and its successors and assigns, may collaterally assign this Pledge Agreement
and its rights, in whole or in part, under this Pledge Agreement to Landlord as
collateral for Secured Party's obligations under the Lease, and Landlord can in
turn collaterally assign the same as collateral for any credit facility secured
in whole or in part by any of the
-7-
Properties, and Pledgor hereby irrevocably consents and agrees to the same. Upon
such collateral assignment: (i) this Pledge Agreement shall inure to the benefit
of the Landlord and the lender or lenders providing such credit facility, and
Pledgor shall sent Landlord and such lender or lenders a copy of any notice sent
by Pledgor to Secured Party under this Pledge Agreement, and Landlord and such
lender or lenders shall have the right, but not the obligation to take any
action of Secured Party under this Pledge Agreement and (ii) no material
amendment, material modification or termination of this Pledge Agreement shall
be effective or binding without the written consent of Landlord and such lender
or lenders and all such actions taken without such consents shall be void. Upon
the payment in full and termination of the Secured Obligations, the security
interest granted hereby shall terminate and all rights to the Pledged Collateral
shall revert to the Pledgor to the extent such Pledged Collateral shall not have
been sold or otherwise applied pursuant to the terms hereof. Upon any such
termination, the Secured Party will, at the Pledgor's expense, deliver all
Pledged Collateral to the Pledgor, execute and deliver to the Pledgor such
documents as the Pledgor shall reasonably request and take any other actions
reasonably requested to evidence or effect such termination.
8.4 Choice of Law. This Pledge Agreement shall be governed by and
-------------
construed and enforced in accordance with the laws of the state of Texas, except
to the extent that the validity or perfection of the security interests
hereunder, or remedies hereunder, in respect of any particular Collateral are
governed by the laws of a jurisdiction other than the state of Texas.
-8-
The parties hereto have caused this Pledge Agreement to be duly executed as
of the date first above written.
PLEDGOR:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_____________________________________________
SECURED PARTY:
AGH LEASING, L.P., a Delaware limited
partnership
By: AGHL GP, INC., a Delaware corporation,
its sole general partner
By:_____________________________________
Name:___________________________________
Title:__________________________________
-9-
SCHEDULE 2.2(a)
Attached to and forming a part of that certain Pledge Agreement dated
__________, by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, as Pledgor, to the Secured Party.
Stock Certificate Number
Stock Issuer Class of Stock No(s). Par Value of Shares
------------ -------------- ----------------- --------- ---------
EXHIBIT A
ASSIGNMENT SEPARATE FROM STOCK CERTIFICATE
FOR VALUE RECEIVED, __________________________ ("Assignor"), hereby sells,
assigns and transfers _____________ shares of the common stock of ______________
________, a _________ corporation (the "Corporation"), to
______________________________, all of such shares of common stock as registered
in Assignor's name on the books of the Corporation, as represented by
Certificate No. ____________ herewith, and does hereby irrevocably constitute
and appoint __________________________________ as its attorney-in-fact to take
any and all actions Assignor could take if acting on its own behalf to
effectuate a transfer of such stock to the indicated assignees on the books of
the Corporation with full power of substitution in the premises, and does hereby
ratify and confirm all that such attorney-in-fact shall lawfully do by virtue
hereof.
Date:____________________
[Assignor]
By:__________________________________________
Name:________________________________________
Title:_______________________________________
IN THE PRESENCE OF:
_________________________________
EXHIBIT "V"
MANAGER'S CONSENT AND AGREEMENT
-------------------------------
THIS MANAGER'S CONSENT AND AGREEMENT ("Agreement"), dated as of ________,
1996, is executed by AMERICAN GENERAL HOSPITALITY, INC., a Texas corporation
(the "Manager"), and AGH LEASING, L.P., a Delaware limited partnership ("AGH"),
in connection with that certain Credit Agreement (the "Credit Agreement") dated
_________, 1996, by and between AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P., a Delaware limited partnership ("Borrower"), BANK ONE, TEXAS,
N.A., a national banking association, as administrative agent, (Bank One, Texas,
N.A. and any subsequent Administrative Agent under the Credit Agreement, are
referred to hereinafter as the "Administrative Agent"), SOCIETE GENERALE, a
French banking corporation acting through its Southwest Agency, as structuring
agent (the "Structuring Agent") (the Structuring Agent and Administrative Agent
are collectively referred to hereinafter as the "Agents"), and the banks and
other lenders a party thereto (collectively the "Banks"), pursuant to which the
Banks have agreed to provide a credit facility (the "Credit Facility") in an
amount of up to $100,000,000.00 to Borrower. All terms used, but not defined, in
this Agreement shall have the meaning given such terms in the Credit Agreement.
The Credit Facility is or will be secured by, among other things, the Initial
Properties and Future Properties (collectively, the "Properties").
Manager is executing this Agreement in consideration for and in connection
with all of the agreements now or hereafter executed with AGH, the tenant in
possession of each of the Properties, for the management of the Improvements
thereon (hereinafter referred to as the "Management Agreements") and as a
condition precedent to the Banks' providing the Credit Facility to Borrower, AGH
is consenting to this Agreement in consideration of and as a condition precedent
to the Bank's making the Credit Facility to Borrower.
1. MANAGER'S REPRESENTATIONS: Manager warrants and represents to the
-------------------------
Agents and the Banks that the following are true and correct:
(a) That Manager has agreed to act as manager of the Improvements on the
Properties.
(b) That all of the Management Agreements as of the date hereof are listed
on Exhibit "A" attached hereto and made a part hereof for all purposes.
(c) That the Management Agreements constitute the valid and binding
agreements of Manager, enforceable in accordance with their terms, and Manager
has full authority under all state or local laws and regulations to perform all
of its obligations under said Management Agreements.
(d) That to the best of Manager's knowledge AGH is not in default in the
performance of any of its obligations under any of the Management Agreements.
2. MANAGER'S AGREEMENTS: AGH has advised Manager that Borrower intends
--------------------
to obtain the Credit Facility from the Banks. The Credit Facility is evidenced
by, among other things, those certain Promissory Notes dated as of the date of
the Credit Agreement, executed by Borrower and payable to the order of Banks in
the aggregate original principal sum equal to the amount of the Credit Facility
(the "Notes"). Manager hereby consents to and agrees to be bound by all the
terms of those certain Assignments of Management Agreements by AGH for the
benefit of Borrower and its affiliates (the "Assignments"), the provisions of
which are hereby incorporated fully by reference. Manager also understands and
acknowledges that the rights conveyed pursuant to such Assignments have been or
will be collaterally assigned by Borrower and its affiliates to Agents and the
Banks as additional security for the Credit Facility. In connection therewith,
Manager further agrees to each and every one of the following for the benefit of
Agents and the Banks and as an inducement to Banks to extend credit to Borrower
pursuant to the terms of the Credit Agreement:
(a) In the event of a default by AGH under any term, covenant or provision
of any of the Management Agreements, Manager will give Administrative Agent
thirty (30) days prior written notice of such default prior to Manager's
exercise of any of its rights or remedies under any of the Management Agreements
or at law, and Administrative Agent shall have the right, but not the
obligation, during said thirty (30) day period to cure such default; provided,
however, that if such default cannot be reasonably cured during such thirty (30)
day period, Administrative Agent shall have such longer period as is reasonably
necessary to cure such default as long as Administrative Agent commences such
cure within such thirty (30) day period. Only in the event Administrative Agent
fails to timely cure or cause to be cured any such default as provided in the
foregoing sentence shall Manager have the right to terminate the Management
Agreement(s) under which such default has occurred. Manager will deliver to
Administrative Agent a copy of all notices of termination given by Manager to
AGH under the Management Agreements simultaneously with the delivery of any such
notices of termination to AGH.
(b) Without the written consent of the Administrative Agent, Manager will
not terminate or amend any arrangement or agreement with respect to the liquor
license for or the sale of alcoholic beverages in connection with any of the
Properties.
(c) The Management Agreements and any and all liens, rights and interests
(whether ▇▇▇▇▇▇ or inchoate and including, without limitation, all mechanic's
and materialman's liens under applicable law) owned, claimed or held, or to be
owned, claimed or held by the Manager in and to the Properties and the
Improvements now or hereafter constructed thereon, are and shall be in all
things subordinate and inferior to the full repayment of the Credit Facility and
the liens and security interests created or to be created for the benefit of the
Agents and the Banks, their respective successors and assigns, and securing the
repayment of the above described Notes including, without limitation, those
created under and by virtue of the Mortgages covering the Properties and filed
or to be filed of record in the public records maintained for the recording of
mortgages and/or deeds of trust in the counties and states in which the
Properties are located (the "Records"), and all renewals and extensions hereof.
(d) Upon the occurrence and during the continuance of an Event of Default
(as defined in the Credit Agreement), Manager shall, at the request of
Administrative Agent, its successors or
-2-
assigns, continue performance on Administrative Agent's, its successors' or
assigns', behalf in accordance with the terms of the Management Agreements,
provided that Manager shall be paid all sums due or to become due it in
accordance with said Management Agreements following the date the Administrative
Agent makes such request. Manager further agrees that, upon the occurrence of
such an Event of Default, the Administrative Agent shall be entitled to accept
or reject each of the Management Agreements on a property by property basis.
Once the Administrative Agent has selected the Properties at which Manager is to
continue performance under the Management Agreements, the remaining Management
Agreements for the Properties not so selected shall terminate and no sums shall
be due and payable by Administrative Agent thereunder. Upon the occurrence and
during the continuance of a monetary Event of Default, Administrative Agent
shall have the continuing right to terminate any or all of the Management
Agreements on a property by property basis, in whole or in part as to certain
Properties, upon no less than thirty (30) days prior written notice to Manager
without any obligation to pay a termination or cancellation fee or penalty to
Manager.
(e) Manager will not voluntarily terminate, or materially amend or modify
any of the Management Agreements without the prior written consent of
Administrative Agent. In the event Manager fails to secure such approval, the
Management Agreements shall, for the purposes of Manager's obligation aforesaid
to continue performance thereunder for Administrative Agent's benefit, be deemed
not to have been modified by such amendment.
(f) Manager further agrees to (i) execute such affidavits and certificates
as Administrative Agent shall reasonably require to further evidence the
agreements herein contained, (ii) on request from Administrative Agent, furnish
Administrative Agent with copies of such information as AGH is entitled to
receive under the Management Agreements, and (iii) cooperate with Administrative
Agent's representatives in any inspection of the Improvements on the Properties.
(g) Manager acknowledges that, in connection with the Credit Facility, AGH
has executed and delivered to Borrower and its affiliates, Assignments of
Leases, Rents and Security Deposits ("Assignments of Leases"), assigning to such
entities all of the right, title and interest in and to any lease of the
Improvements on the Properties, including any security deposits thereunder, and
all revenues, accounts and proceeds from the Properties and Improvements.
Manager also acknowledges that the rights conveyed pursuant to the Assignments
of Leases have been or will be collaterally assigned to Agents and the Banks as
additional security for the Credit Facility. Manager hereby agrees that upon
receipt of written notice from Administrative Agent that an Event of Default has
occurred under the Credit Facility, Manager shall henceforth deliver to
Administrative Agent, for application in accordance with the terms and
conditions of the Credit Agreement, all rents and other proceeds received from
and after the date thereof from any and all tenants, concessionaires, or other
parties occupying or using any portion of the Improvements, and all revenues,
accounts and proceeds from the Properties and Improvements received from and
after the date thereof. Manager acknowledges that, in connection with the Credit
Facility, Cash Management Systems (as defined in the Credit Agreement) have been
set up with respect to the Properties which Cash Management Systems Manager is
familiar with and agrees to abide by in connection with any cash, cash
equivalents or credit card receipts received by Manager with respect to such
Properties.
-3-
(h) Administrative Agent has no obligation to Manager with respect to the
Credit Facility, and Administrative Agent's obligations to Borrower with respect
thereto are set forth in the Credit Agreement and certain other credit documents
by and between Banks, Agents, Borrower and Borrower's affiliates ("Credit
Documents"), with respect to which the Manager is not a third party beneficiary.
The relationship of Agents and Banks to Borrower and Borrower's affiliates is
one of a creditor to a debtor, and Agents and Banks are not joint venturers or
partners of Borrower or Borrower's affiliates.
(i) Manager further agrees that nothing herein shall impose upon
Administrative Agent any obligation for payment or performance in favor of
Manager unless Administrative Agent notifies Manager in writing after an Event
of Default under the Notes or Credit Documents, that (i) Administrative Agent
has elected to assert AGH's rights under all or certain of the Management
Agreements and (ii) Administrative Agent agrees to pay Manager the sums due
Manager under the terms of such Management Agreements.
(j) Manager covenants and agrees that, upon Administrative Agent or any
other party (a "Subsequent Owner") acquiring title to any of the Properties and
Improvements either through foreclosure or by acceptance of a deed, assignment
or other conveyance in lieu thereof (collectively, "Foreclosure") or after
Foreclosure, (1) Manager shall deliver to a Subsequent Owner originals or copies
if originals are not available of: (A) all authorizations, approvals, permits,
variances and land use entitlement required for the development and maintenance
of the Properties and Improvements; (B) all permits, licenses and agreements
required for the use, occupancy or operation of the Properties and Improvements,
including, without limitation, to the extent permitted by law, all liquor
licenses obtained by Manager in connection with the Properties and Improvements
and (C) all leases of personal property now or hereafter entered into by Manager
in connection with the development, use, occupancy or operation of the
Properties or Improvements, whether such leases are owned by or issued in the
name of Manager or some other party (the items described in (A), (B) and (C)
being hereinafter collectively referred to as the "Agreements"). Manager shall,
to the maximum extent permitted by law, upon request of any Subsequent Owner,
immediately transfer to such Subsequent Owner all of such Agreements, and will
cooperate with such Subsequent Owner to effectuate a full assignment, conveyance
and transfer of such Agreements so that the smooth and continual operation of
the Properties and Improvements is not impaired or hindered, (2) Manager shall
execute such further instruments or documents as a Subsequent Owner may
reasonably require to further effect the purposes hereof, including, without
limitation, upon the occurrence of a Foreclosure, such documents as may be
necessary to vest title in such Subsequent Owner to any liquor licenses then
held by Manager in connection with the Properties and Improvements and (3) any
Subsequent Owner shall have the continuing right to terminate any or all of the
Management Agreements on a property by property basis, in whole or in part as to
certain Properties, upon no less than thirty (30) days prior written notice to
Manager without any obligation to pay a termination or cancellation fee or
penalty to Manager. Notwithstanding any provision contained herein to the
contrary, the obligations of Manager pursuant to this Agreement shall survive
any termination of the Management Agreements. A Subsequent Owner shall only
incur liability to Manager under all or certain of the Management Agreements
during such Subsequent Owner's ownership of the corresponding Properties and
Improvements. Upon a sale, conveyance, transfer or other assignment of any of
the Properties and Improvements or a termination of the corresponding Management
Agreement(s), a
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Subsequent Owner shall have no further liability to Manager under such
terminated Management Agreement(s) from the date of such sale, conveyance,
transfer, assignment or termination. In addition, no Subsequent Owners shall
have personal liability under the Management Agreement(s) or this Agreement, and
Manager agrees to look solely to such Subsequent Owner's interest in the
Properties and Improvements for satisfaction of any sums or other obligations
owed Manager under the Management Agreement(s).
(k) Manager hereby represents and warrants that no prior assignment of
Manager's interest in the Management Agreements has been made, and Manager
agrees and covenants not to assign, sell, pledge, transfer or otherwise encumber
Manager's interest in the Management Agreements so long as any portion of the
Credit Facility remains outstanding.
(l) Manager has executed this Agreement for the purpose of inducing Banks
to advance sums to Borrower under the above described Notes and with full
knowledge and intent that Banks shall rely upon the representations, warranties
and agreements herein contained when making advances to Borrower, and that but
for this instrument and the representations, warranties and agreements herein
contained, Banks would not take such actions.
(m) The Administrative Agent shall have the continuing right to file a
copy of this Agreement in any of the Records without the need for further
consent of Manager, AGH or any of their respective affiliates.
3. AGH's CONSENT: AGH has joined herein to evidence its consent to all
-------------
the agreements of Manager contained in this Agreement.
EXECUTED this the _____ day of ______________, 1996.
MANAGER:
AMERICAN GENERAL HOSPITALITY, INC.
By:_________________________________
Name:_______________________________
Title:______________________________
AGH:
AGH LEASING, L.P., A DELAWARE LIMITED
PARTNERSHIP,
By: AGHL GP, Inc., a Delaware corporation,
its sole general partner
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By:____________________________________
Name:__________________________________
Title:_________________________________
-6-
THE STATE OF ___________ (S)
(S)
COUNTY OF _____________ (S)
This instrument was acknowledged before me on the ___ day of ______, 1996
by _______________, ________________ of American General Hospitality, Inc., a
__________ corporation on behalf of said corporation.
_____________________________
Notary Public in and for the
State of _____________
Name:_________________________
My Commission Expires: _______
THE STATE OF __________ (S)
(S)
COUNTY OF ___________ (S)
This instrument was acknowledged before me on the ______ day of ________,
1996, by _____________________,_______________ of AGHL GP, Inc., the sole
general partner of AGH Leasing, L.P., a Delaware limited partnership, on behalf
of said partnership.
__________________________________
Notary Public in and for the
State of _________________
Name:______________________________
My Commission Expires:_________
-7-
EXHIBITS
--------
Exhibit "A" - Management Agreements
-8-
EXHIBIT "W"
FORM OF DEED OF TRUST, SECURITY AGREEMENT ASSIGNMENT
OF RENTS AND FINANCING STATEMENT
THE STATE OF______ (S)
(S) KNOWN ALL MEN BY THESE PRESENTS:
COUNTY OF_________ (S)
THAT the undersigned,________________________("Grantor"), a
_______________, having an office and mailing address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention ___________ and whose address
is set forth opposite its signature, in consideration of TEN AND NO/100 DOLLARS
($10.00) in hand paid, and of the debt and trust hereinafter mentioned, has
GRANTED, BARGAINED, SOLD, CONVEYED, TRANSFERRED, ASSIGNED and SET OVER, and by
these presents does GRANT, BARGAINED, SELL, CONVEY, TRANSFER, ASSIGN and SET
OVER unto ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, TRUSTEE [INSERT OTHER TRUSTEE WHERE STATE REQUIRES
THAT THE TRUSTEE BE A RESIDENT], having an address at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (hereafter called the "Trustee")
and to his substitutes or successors in trust, the following described land and
property situated in the County of __________, State of _________.
and being more particularly described by metes and bounds on Exhibit "A"
attached hereto and incorporated herein for all purposes (the "Land");
together with all buildings, fixtures and other improvements on the Land or
hereafter placed on the Land; all rights, titles and interests now owned or
hereinafter acquired by Grantor in and to all easements, streets and rights of
way of every kind and nature adjoining the Land, and all public or private
utility connections thereto and all leasehold interests, appurtenances,
servitudes, rights, privileges, prescriptions and advantages thereunto belonging
or in anywise appertaining; all materials, goods (including without limitation
consumables and inventories), equipment, appliances, apparatus, furniture,
furnishings, inventory and other property, real or personal, now owned or
hereafter acquired by Grantor and now or hereafter installed, used or located on
the above described property or the improvements thereon, whether or not the
same have or would become a part of the Land by attachment thereto, including,
but not limited to, all heating, lighting, refrigeration, plumbing, ventilating,
laundry, incinerating, water-heating, cooking, dishwashing, radio,
communication, electrical and air conditioning equipment, appliances, fixtures
and appurtenances, together with all disposals, dishwashers, machinery,
elevators, pumps, generators, sprinklers, wiring, pipe, doors, motors,
compressors, boilers, condensing units, range hoods, windows, window screens,
window shades, venetian blinds, awnings, drapes, shelving, mantels, cabinets,
paneling, rugs and other floor coverings, and shrubbery and other chattels and
personal property as are ever used, usable or furnished in connection with any
present or future operation, use or enjoyment of the Land and the improvements
on the Land, and all renewals,
replacements and substitutions thereof and additions thereto and Grantor's
current and future rights as lessee under leases of any of the foregoing; all
rights, titles and interests of Grantor in and to all crops located on and
timber to be cut from the Land and all minerals in, under and upon, produced or
to be produced from the Land; all rights to the present or future use of
wastewater, drainage water or other utility facilities to the extent such use
benefits the Land or the improvements now or hereafter located thereon; and
without limitation of the foregoing, any and all permits, licenses, approvals,
rights, rents, revenues, benefits, leases, concessions, licenses, contracts,
accounts (including without limitation all rights to payment from any consumer
credit/charge card organization or entity), general intangibles, trade names,
monies, instruments, documents, tenements, hereditaments and appurtenances now
or hereafter owned by Grantor and appertaining to, generated from, arising out
of or belonging to the above described properties or any part thereof (including
without limitation the Grantor's Concentration Bank Account); and Grantor's
interest in all 1-800 and other telephone numbers (all of the aforesaid being
hereinafter sometimes called the "Mortgaged Premises"). The Mortgaged Premises
shall also include the Grantor's interest, if any, in all current and future
management, franchise and license agreements related to the Land or improvements
thereon and the Hotel Lease (as hereinafter defined). Some of the said items are
or are to become "fixtures" (as that term is defined in the Uniform Commercial
Code, as adopted in the state in which the Mortgaged Premises are located (the
"Code")) on the Land and as provided under the Code, this Deed of Trust,
Security Agreement, Assignment of Rents and Financing Statement upon being filed
for record in the real property records of the state and county where the
Mortgaged Premises are located, shall operate also as a "fixture filing" and
financing statement upon such of the items as are or may become fixtures.
TO HAVE AND TO HOLD the Mortgaged Premises unto the Trustee and his
substitutes or successors forever. And Grantor does hereby bind itself, its
heirs, executors, administrators, successors and assigns to warrant and forever
defend the title to the Mortgaged Premises, or any part thereof, unto the
Trustee, his substitutes or successors forever against all persons whomsoever
claiming or to claim the same or any part thereof.
1. CREDIT AGREEMENTS AND NOTES.
(a) [AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., A
DELAWARE LIMITED PARTNERSHIP (THE "BORROWER"), WHICH IS THE DIRECT OR INDIRECT
OWNER OF THE GRANTOR] [GRANTOR], Bank One, Texas, N.A., as Administrative Agent
(the "Administrative Agent"), and Societe Generale, Southwest Agency, as
Structuring Agent, and the banks and other lenders party thereto (collectively
the "Banks") have entered into a Credit Agreement dated as of __________, 1996
(as amended or otherwise modified from time to time, the "Credit Agreement").
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(b) [BORROWER/GRANTOR] has executed promissory notes of even date
with the Credit Agreement in favor of the Banks in the original aggregate
principal amount of $100,000,000.00, the final payments of which are due on or
before June 30, 2000 (the "Notes", which term includes any modification,
renewal, extension or alteration thereof).
(c) The Notes were executed and delivered to Administrative Agent and
the Banks, and shall be due and payable in accordance with the Credit Agreement.
(d) All capitalized terms not otherwise defined in this
instrument shall have the meaning assigned to such terms by the Credit
Agreement.
(e) Grantor is [LEASING/SUBLEASING] a portion of the Mortgaged
Premises to AGH Leasing, L.P. ("the Tenant") under that certain lease executed
between Grantor and Tenant (the "Hotel Lease").
(f) The terms and provisions of the Notes and Credit Agreement are
incorporated herein by reference and made a part of this Deed of Trust to the
same extent as though set forth in full herein.
(g) As a condition to the acceptance of the Notes and the making of
the loan evidenced by the Credit Agreement (the "Loan), Grantor agreed to
execute and deliver this Deed of Trust to secure the payment of the indebtedness
from time to time evidenced by the Notes, the payment of all other sums now or
hereafter owing by [BORROWER AND] Grantor and the Guarantors (all such Persons
being collectively referred to herein as the "Obligors") hereunder, under the
Credit Agreement or under any other document or instrument now or hereafter
evidencing or securing the aforesaid indebtedness or otherwise executed in
connection herewith or therewith (this Deed of Trust, the Notes, the Credit
Agreement and all other documents and instruments now or hereafter evidencing or
securing the aforesaid indebtedness or otherwise executed in connection herewith
or therewith, being hereinafter referred to collectively as the "Loan
Documents"), and the performance and observance of all covenants, agreements,
conditions and other provisions set forth herein, in the Notes and in the other
Loan Documents.
This conveyance is made in trust on the terms and conditions herein set forth to
secure the payment of the indebtedness from time to time evidenced by the Notes,
the payment of all other sums now or hereafter owing by the Obligors hereunder,
under the Credit Agreement or any other Loan Document and the performance and
observance of all covenants, agreements, conditions and other provisions set
forth herein, in the Notes, the Credit Agreement or any other Loan Document.
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2. FUTURE ADVANCES AND ADDITIONAL INDEBTEDNESS. In addition, this
conveyance is made in trust (i) to secure the performance and discharge of each
and every promise, obligation, covenant and agreement contained in the Notes,
this Deed of Trust, the Credit Agreement and any other instrument pertaining to
the herein described Said Indebtedness or the security therefor and (ii) to
secure the following (all of the following, including the hereinabove described
Notes and the foregoing, herein sometimes called "Said Indebtedness"):
(a) The payment of all other amounts with interest thereon becoming due
and payable to the Administrative Agent and the Banks under the terms
of the Notes, this Deed of Trust, or any instrument securing or
executed in connection with the Notes, including (but not limited to)
any moneys advanced thereunder by Administrative Agent or the Banks on
behalf of Obligors;
(b) Any extension, modification, renewal or reamortization of said Notes,
and any increase or addition thereto; and
(c) The payment of all other indebtedness, of whatever kind or character,
now owing or which may hereafter become owing by the Obligors to
Administrative Agent and the Banks, pursuant to the terms and
conditions of the Credit Agreement or any other Loan Document, whether
such indebtedness is direct or indirect, primary or secondary, fixed
or contingent or arises out of or is evidenced by note, deed of trust,
open account, overdraft, endorsement, surety agreement, guaranty or
otherwise, it being contemplated that the Obligors may hereafter
become indebted to Administrative Agent and the Banks for further sum
or sums.
3. ADDITIONAL SECURITY. As additional security for the payment of the
Said Indebtedness, Grantor hereby transfers, assigns and conveys unto the
Administrative Agent, for its benefit and the ratable benefit of the Banks, and
hereby grants Administrative Agent a security interest in the following and all
products and proceeds of the same (hereinafter collectively referred to as the
"Income"), but the mention of products and proceeds herein shall not be
construed as an authorization for the transfer or surrender by Grantor of the
Income:
(a) All judgments, awards of damages, insurance proceeds and settlements
hereafter made resulting from condemnation proceedings or the taking
of all or any part of the Mortgaged Premises under the power of
eminent domain, or for any damage (whether caused by a taking, a
casualty or otherwise) to
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the Mortgaged Premises or any part thereof, or to any rights
appurtenant thereto, including, but not limited to, any award for
change of grade of streets. The Administrative Agent is hereby
authorized, but shall not be required, on behalf and in the name of
Grantor, to execute and deliver valid acquittances for, and to appeal
from, any such judgments or awards. Subject to the terms and
conditions of the Credit Agreement, the Administrative Agent may apply
all such sums or any part thereof so received, after the payment of
all expenses, including costs and attorney's fees, as a payment on
Said Indebtedness in such manner as the Administrative Agent elects.
(b) All bonuses, rents and royalties accrued or to accrue under all oil,
gas or mineral leases affecting the Mortgaged Premises, now existing
or which may hereafter come into existence. Grantor directs payment of
the same to the Administrative Agent, for the benefit of the Banks at
the option of the Administrative Agent upon written demand of the
Administrative Agent therefor, to be applied to Said Indebtedness
until paid, whether due or not, and either before or after any default
under the terms of this Deed of Trust or Said Indebtedness.
(c) All rents, income and profits issuing or to hereafter issue from the
Mortgaged Premises, and in the event of a Default hereunder,
Administrative Agent, for the benefit of the Banks shall have the
right, at its option, and with or without taking possession of the
Mortgaged Premises, to collect said rents, income and profits, or if
the Mortgaged Premises are vacant to rent the same and collect the
rents, and apply the same to the payment of Said Indebtedness after
deducting all costs of collection and administration. The collection
of said rents, income and profits by the Administrative Agent shall
not constitute a waiver of its right to accelerate the maturity of the
Notes nor of its right to proceed with the enforcement of this Deed of
Trust. Grantor shall not assign the whole or any part of the rents,
income or profits arising from the Mortgaged Premises without the
prior written consent of Administrative Agent and any assignment
thereof without such consent will be null and void; and upon notice
and demand, Grantor shall transfer and assign to Administrative Agent,
in form satisfactory to Administrative Agent, the lessor's interest in
any lease now or hereafter affecting the whole or any part of the
Mortgaged Premises. Grantor agrees that it shall duly and timely
perform all of its obligations as provided for in any leases or other
rental contracts covering or relating to any of the Mortgaged
Premises.
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The liens, security interests and rights granted by this Deed of Trust shall not
affect or be affected by any other security taken for the Said Indebtedness or
any part thereof. The taking of additional security, or the extension or
renewal of Said Indebtedness or any part thereof, shall at no time release or
impair the liens, security interests and rights granted hereby, or affect the
liability of any endorser, guarantor, or surety, or improve the right of any
junior lienholder; and this Deed of Trust, as well as any instrument given to
secure any renewal or extension of Said Indebtedness, or any part thereof, shall
be and remain the first and prior lien and security interest on all of the
Mortgaged Premises not expressly released, until the Said Indebtedness is
completely paid.
4. SUBROGATION TO EXISTING LIENS. It is agreed that the lien hereby
created shall take precedence over and be a prior lien to any other lien of any
character whether vendor's materialman's or mechanic's lien hereafter created on
the Mortgaged Premises, and in the event the proceeds of the Notes are used to
acquire or to pay off and satisfy any indebtedness and liens heretofore existing
on the Mortgaged Premises, then the Administrative Agent is, and shall be for
the benefit of the Banks, subrogated to all of the rights, liens and remedies of
the holders of the indebtedness and liens so acquired or paid off, regardless of
whether said indebtedness and liens are acquired by the Administrative Agent by
assignment or are released by the holders thereof upon payment.
5. COVENANTS, REPRESENTATIONS AND AGREEMENTS OF GRANTOR. Grantor
covenants, represents and agrees:
(a) That Grantor will timely perform all of its obligations under the
Notes, the Credit Agreement and every other Loan Document (as defined
in the Credit Agreement), in accordance with their respective terms
and conditions.
(b) That Grantor shall pay, prior to delinquency, all taxes and
assessments levied or assessed against the Mortgaged Premises,
including, without limitation, all taxes in lieu of ad valorem taxes,
as the same become due and payable. In the event of the passage after
date of this Deed of Trust of any law or regulation deducting from the
Mortgaged Premises for the purposes of taxation any lien thereon, or
changing in any way the laws now in force for the taxation of
mortgages, deeds of trust, or indebtedness secured thereby, for state
or local purposes, or the manner of the operation of any such taxes so
as to affect the interest of Administrative Agent or the Banks, then
and in such event, Grantor shall bear and pay the full amount of such
taxes. If Grantor fails to pay any such taxes and assessments
including, without limitation, taxes in lieu of ad valorem taxes and
taxes against this Deed of Trust or Said Indebtedness secured hereby,
Administrative Agent may pay the same,
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together with all costs and penalties thereon, at Grantor's expense;
provided, however, that if for any reason payment by Grantor of any
such new or additional taxes would be unlawful or if the payment
thereof would constitute usury or render Said Indebtedness wholly or
partially usurious under any of the terms or provisions of the Notes
or this Deed of Trust, or otherwise, Administrative Agent may, at its
option and for benefit of the Banks, declare Said Indebtedness with
all accrued interest thereon to be immediately due and payable, or
Administrative Agent may, at its option, pay the amount or portion of
such taxes as renders Said Indebtedness unlawful or usurious, in which
event Grantor shall concurrently therewith pay the remaining lawful
and nonusurious portion or balance of said taxes.
(c) That Grantor shall keep every part of the Mortgaged Premises in good
condition and presenting an appearance customary for like-situated
properties and in compliance with all requirements of any franchisor
with respect to the business operated on the Mortgaged Premises, make
promptly all repairs, renewals and replacements necessary to such end,
prevent waste to any part of the Mortgaged Premises, and do promptly
all else necessary to such end; and Grantor shall discharge all claims
for labor performed and material furnished therefor, and shall not
suffer any lien of mechanics or materialmen therefor to attach to any
part of the Mortgaged Premises. Grantor shall guard every part of the
Mortgaged Premises from removal, destruction and damage, and shall not
do or suffer to be done any act whereby the value of any part of the
MOrtgaged Premises may be lessened. No building or other property now
or hereafter covered by the lien of this Deed of Trust shall be
removed, demolished or materially altered or enlarged, nor shall any
new building be constructed, without the prior written consent of
Administrative Agent, which consent shall not be unreasonably withheld
or delayed. Administrative Agent and the Banks and their respective
agents or representatives shall have access to the Mortgaged Premises
at all reasonable times in order to inspect same and verify Grantor's
compliance with its duties and obligations under this document.
(d) That in the event Grantor shall fail to keep the improvements on the
Mortgaged Premises in the condition required hereby, or to pay
promptly when due all taxes and assessments, as aforesaid, or to
preserve the prior lien of this Deed of Trust on the Mortgaged
Premises, or to keep the buildings and improvements insured, as
provided in the Credit Agreement, or to deliver the policy, or
policies, of insurance or the renewal thereof to the Administrative
Agent, as provided in the Credit Agreement, then the Administrative
Agent
-7-
may, at its option, but without being required to do so, make such
repairs, pay such taxes and assessments, purchase any tax title
thereon, remove any prior liens, and prosecute or defend any suits in
relation to the preservation of the prior lien of this Deed of Trust
on the Mortgaged Premises, or insure and keep the improvements thereon
insured in an amount not to exceed that stipulated in the Credit
Agreement; that any suns which may be so paid out by the
Administrative Agent and all sums paid for insurance premiums, as
aforesaid, including, but not limited to, the costs, expenses and
reasonable attorney's fees paid in any proceeding, transaction or suit
affecting the Mortgaged Premises when necessary to protect the lien
hereof shall bear interest from the dates of such payments as the
Default Rate (as defined in the Credit Agreement), and shall be paid
by Obligors and Grantor to the Administrative Agent and the Banks in
accordance with the Credit Agreement, as the same place at which the
Notes are payable, and shall be deemed a part of the debt hereby
secured and recoverable as such in all respects.
(e) That Grantor shall comply with all restrictive covenants and all laws,
ordinances, regulations and rules, whether state, federal or
municipal, applicable to the Mortgaged Premises and its ownership, use
and occupancy, and that Grantor has obtained all approvals, licenses
and permits necessary for the ownership, use and occupancy of the
Mortgaged Premises.
(f) That in the six (6) months prior to the recordation of this Deed of
Trust in the real property records of the county or counties in which
the Mortgaged Premises or any part thereof is situated, (i) no
construction of any proposed above or below ground improvements,
structures, additions or alterations has commenced, (ii) no materials
or supplies have been delivered to or labor performed on the Mortgaged
Premises, and (iii) Grantor has not entered into any contracts or
agreements for the construction of any improvements, structures,
additions or alterations, or the delivery of any materials or supplies
or the performance of said labor.
6. RELEASE. If Grantor shall well and truly pay, or cause to be paid, the
Said Indebtedness, and any other indebtedness that may be owing thereunder or
hereunder, and does keep and perform each and every covenant, condition, and
stipulation contained in the Notes and this Deed of Trust, then this conveyance
shall become null and void and shall be released by Administrative Agent upon
request and at the expense of Grantor.
-8-
7. DEFAULT. The term "Default", as used herein, shall mean the
occurrence of any one of the following events:
(a) The occurrence of an "Event of Default" as defined in the Credit
Agreement; or
(b) Grantor abandons all or a portion of the Mortgaged Premises; or
(c) The holder of any lien or security interest on the Mortgaged Premises
institutes foreclosure or other proceedings for the enforcement of its
remedies thereunder; or
(d) Except as expressly provided otherwise in the Credit Agreement, if
Grantor, or any partner thereof, dissolves, liquidates, terminates, or
conveys, transfers, assigns, or pledges any interest in the Mortgaged
Premises or Grantor or any other Transfer shall occur which has not
been approved in writing by Administrative Agent.
Grantor's failure to perform or observe any covenant contained in this Deed of
Trust, other than those contained in Section 21 below and except as provided to
the contrary herein, shall not constitute a Default: (1) until such failure
shall remain unremedied for thirty (30) days after the date written notice of
such default shall have been given to the Grantor by the Administrative Agent or
any of the Banks or (2) if such performance is incapable of being completed
within thirty (30) days, unless Grantor fails to commence the performance of
such covenant, agreement or other obligation within said thirty (30) day period
and thereafter diligently pursue such performance until completion.
Upon the occurrence of a Default, Administrative Agent, at its option, and
without notice of intent to accelerate, notice of acceleration, or any notice,
demand, or presentment, which are hereby expressly waived by Grantor and the
other Obligors, may declare the entire unpaid balance of principal of, and all
accrued interest on, the Said Indebtedness immediately due and payable, in
addition to exercising any and all remedies provided for under this Deed of
Trust, the instruments evidencing Said Indebtedness and all other instruments
securing Said Indebtedness, or any part thereof. Upon the occurrence of a
Default, Administrative Agent shall also have the right to proceed with
foreclosure either through the courts or by directing the Trustee to proceed
with foreclosure as set forth in Paragraph 8 below. The filing of a suit to
foreclose this Deed of Trust, either on any matured portion of Said
Indebtedness or for the entire Said Indebtedness, shall never be considered an
election so as to preclude foreclosure by the Trustee under the provisions of
Paragraph 8 after dismissal of the suit; nor shall the filing of the necessary
notices of foreclosure, as provided in
-9-
Paragraph 8 below preclude the prosecution of a later suit thereon. Upon the
occurrence of a Default, Administrative Agent shall also have the right to
exercise any and all other rights, remedies and recourse now or hereafter
existing in equity, at law, by virtue of statute or otherwise.
8. FORECLOSURE. Upon the occurrence of a Default, Administrative Agent
may, at its option, and in addition to any and every other remedy, request
Trustee to proceed with foreclosure (which request shall be presumed), and in
such event Trustee is hereby authorized and empowered and it shall be his
special duty, upon such request of Administrative Agent, to: [ADD APPROPRIATE
STATE FORECLOSURE PROVISION.]
9. APPLICATION OF PROCEEDS OF SALE. The proceeds of any sale held by the
Trustee or any receiver or public officer in foreclosure of the liens evidenced
hereby shall be applied:
FIRST, to the payment of all necessary costs and expenses incident to
such foreclosure sale, including, but not limited to, all court costs and
charges of every character in the event foreclosed by suit, and a reasonable fee
to the Trustee acting under the provisions of Paragraph 8 above, if foreclosed
by power of sale as provided in said paragraph;
SECOND, to the payment in full of the Said Indebtedness (including
specifically without limitation the principal, interest and attorneys' fees due
and unpaid on the Notes and the amounts due and unpaid and owed to the
Administrative Agent under this Deed of Trust) in such order as the
Administrative Agent may elect; and
THIRD, the remainder, if any there shall be, shall be paid to Grantor
or to Grantor's heirs, personal representatives, successors or assigns.
10. ADMINISTRATIVE AGENT MAY PURCHASE. The Administrative Agent and the
Banks shall have the right to become the purchaser at any sale held by any
Trustee or substitute or successor or by any receiver or public officer, and
shall have the right to credit upon the amount of the bid made therefor, to the
extent necessary to satisfy such bid, the Said Indebtedness (or a part thereof)
owing to such party, or if such party holds less than all of Said Indebtedness
the pro rata part thereof owing to such party, accounting to all other parties
secured hereby not joining in such bid in cash for the portion of such bid or
bids apportionable to them.
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11. FORECLOSURE WITHOUT MATURING ENTIRE NOTES. Upon the occurrence of a
Default, the Administrative Agent shall have the option to proceed with
foreclosure of the liens and security interests evidenced hereby in satisfaction
of such item either through the courts or by proceeding or by directing the
Trustee to proceed as if under a full foreclosure, conducting the sale as herein
provided, all without declaring the entire Said Indebtedness due, and provided
that if sale of the Mortgaged Premises are made because of default in the
payment of a part of the Said Indebtedness, such sale may be made subject to the
unmatured part of the Said Indebtedness; and such sale, if so made, shall not in
any manner affect the unmatured part of the Said Indebtedness, but as to such
unmatured part this Deed of Trust shall remain in full force and effect just as
though no sale had been made. The proceeds of any sale shall be applied as
provided in Paragraph 9 above except that the amount paid under subparagraph
SECOND thereof shall be only the matured portion of the Said Indebtedness and
any proceeds of such sale in excess of those provided for in subparagraphs FIRST
and SECOND (modified as provided above) shall be applied to installments of
principal and interest on the Said Indebtedness in proportion to the unpaid
principal balances thereof in the inverse order of maturity. Several sales may
be made hereunder without exhausting the right of sale for any unmatured part of
the Said Indebtedness. It is the purpose hereof to provide for a foreclosure and
sale of the Mortgaged Premises for any matured portion of the Said Indebtedness
without exhausting the power to foreclosure and to sell the Mortgaged Premises
for any other part of the Said Indebtedness whether matured at the time or
subsequently maturing.
12. OCCUPANCY AFTER FORECLOSURE. In the event there is a foreclosure sale
hereunder and at the time of such sale Grantor or Grantor's representatives,
successors or assigns or any other persons claiming any interest in the
Mortgaged Premises by, through or under Grantor are occupying or using the
Mortgaged Premises or any part thereof, each and all shall, at the option of the
Administrative Agent or the purchaser at such sale, as the case may be,
immediately become the tenant of the purchaser at such sale, which tenancy shall
be a tenancy from day-to-day, terminable at the will of either landlord or
tenant, at a reasonable rental per day based upon the value of the Mortgaged
Premises occupied, such rental to be due daily to purchaser. In the event the
tenant fails to surrender possession of said property upon the exercise of such
option, the purchaser shall be entitled to institute and maintain an eviction
proceeding before the appropriate court of the County and State in which the
Mortgaged Premises, or any part thereof, is situated.
13. SUBSTITUTE OR SUCCESSOR TRUSTEE. The Trustee may resign by an
instrument in writing addressed to the Administrative Agent, or the Trustee may
be removed at any time with or without cause by the Administrative Agent. In
case of the death, resignation, removal or disqualification of the Trustee or if
for any reason the Administrative Agent shall deem it desirable to appoint a
substitute or successor trustee to act instead of the
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herein named trustee or any substitute or successor trustee, then the
Administrative Agent shall have the right and is hereby authorized and empowered
to appoint a successor trustee, or a substitute trustee, without other formality
than appointment and designation in writing executed by the Administrative
Agent, and the authority hereby conferred shall extend to the appointment of
other successor and substitutes trustees successively until the indebtedness
secured hereby has been paid in full or until the Mortgaged Premises are sold
hereunder. In the event the indebtedness secured hereby is held by more than one
person or entity, the holder or holders of not less than a majority in the
amount of such indebtedness shall have the right and authority to make the
appointment of a successor or substitute trustee provided for in the preceding
sentence. Such appointment and designation by the Administrative Agent or by the
holder or holders of not less than a majority of the indebtedness secured hereby
shall be full evidence of the right and authority to make the same and of all
facts therein recited. If the Administrative Agent is a corporation and such
appointment is executed in its behalf by an officer of such corporation, such
appointment shall be conclusively presumed to be executed with authority and
shall be valid and sufficient without proof of any action by the board of
directors or any superior officer of the corporation. Upon the making of any
such appointment and designation, all of the estate and title of the Trustee in
the Mortgage Premises shall vest in the named successor or substitute trustee
and he shall thereupon succeed to and shall hold, possess and execute all the
rights, powers, privileges, immunities and duties herein conferred upon the
Trustee; but nevertheless, upon the written request of the Administrative Agent
or of the successor of substitute trustee, the Trustee ceasing to act shall
execute and deliver an instrument transferring to such successor or substitute
trustee all of the estate and title in the Mortgaged Premises of the Trustee so
ceasing to act, together with all rights, powers, privileges, immunities and
duties herein conferred upon the Trustee, and shall duly assign, transfer and
deliver any of the properties and moneys held by said Trustee hereunder to said
successor or substitute trustee. All references herein to the Trustee shall be
deemed to refer to the Trustee (including any successor or substitute appointed
and designated as herein provided) from time to time acting hereunder. Grantor
hereby ratifies and confirms any and all acts which the herein named Trustee or
his successor or successors, substitute or substitutes, in this trust, shall do
lawfully by virtue hereof.
14. LIABILITY OF TRUSTEE. The Trustee shall not be liable for any error
of judgment or act done by the Trustee in good faith, or be otherwise
responsible or accountable under any circumstances whatsoever, except for the
Trustee's gross negligence or willful misconduct. The Trustee shall have the
right to rely on any instrument, document or signature authorizing or supporting
any action taken or proposed to be taken by him hereunder, believed by him in
good faith to be genuine. All moneys received by the Trustee shall, until used
or applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated in any manner from any other moneys
(except
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to the extent required by law), and the Trustee shall be under no liability for
interest on any moneys received by him hereunder. Grantor will reimburse the
Trustee for, and indemnify and save him harmless against, any and all liability
and expenses which may be incurred by him in the performance of his duties
hereunder.
15. JUDICIAL FORECLOSURE. This instrument shall be effective as a mortgage
as well as a deed of trust and upon the occurrence of a Default may be
foreclosed as to any of the Mortgaged Premises in any manner permitted by the
laws of the State of Texas or of any other state in which any part of the
Mortgaged Premises are situated, and any foreclosure suit may be brought by the
Trustee or by the Administrative Agent. In the event a foreclosure hereunder
shall be commenced by the Trustee, or his substitute or successor, the
Administrative Agent may at any time before the sale of the Mortgaged Premises
direct the said Trustee to abandon the sale, and may then institute suit for the
collection of Said Indebtedness and the other secured indebtedness, and for the
foreclosure of this Deed of Trust. It is agreed that if the Administrative Agent
should institute a suit for the collection of the Said Indebtedness or any other
secured indebtedness, and for the foreclosure of this Deed of Trust, the
Administrative Agent may at any time before the entry of a final judgment in
said suit dismiss the same, and require the Trustee, his substitute or successor
to sell the Mortgaged Premises in accordance with the provisions of this Deed of
Trust.
16. APPOINTMENT OF A RECEIVER. In addition to all other remedies herein
provided for, Grantor agrees that upon the occurrence of a Default, or any event
or circumstance which, with the lapse of time or the giving of notice, or both,
would constitute a Default hereunder, the Administrative Agent shall as a matter
of right be entitled to the appointment of a receiver or receivers for all or
any part of the Mortgaged Premises, whether such receivership be incident to a
proposed sale of such property or otherwise, and without regard to the value of
the Mortgaged Premises or the solvency of any person or persons liable for the
payment of the indebtedness secured hereby, and Grantor does hereby consent to
the appointment of such receiver or receivers, waives any and all defenses to
such appointment and agrees not to oppose any application therefor by the
Administrative Agent, but nothing herein is to be construed to deprive the
Administrative Agent or any of the Banks of any other right, remedy or privilege
it may now have under the law to have a receiver appointed; provided, however,
that the appointment of such receiver, trustee or other appointee by virtue of
any court order, statute or regulation shall not impair or in any manner
prejudice the rights of the Administrative Agent and the Banks to receive
payment of the rents and income pursuant to this Deed of Trust. Any money
advanced by the Administrative Agent in connection with any such receivership
shall be a demand obligation owing by Grantor to the Administrative Agent and
shall bear interest from the date of making such advancement by the
Administrative Agent until paid at the highest rate of interest for which
Grantor may legally contract under applicable law and shall be a part of the
Said Indebtedness and shall
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be secured by this Deed of Trust and by any other instrument securing the
secured indebtedness.
17. POSSESSION BY ADMINISTRATIVE AGENT. Upon the occurrence of a Default
the Administrative Agent is authorized prior or subsequent to the institution of
any foreclosure proceedings to enter upon the Mortgaged Premises, or any part
thereof, and to take possession of the Mortgaged Premises and of all books,
records and accounts relating thereto and to exercise without interference from
Grantor any and all rights which Grantor has with respect to the management,
possession, operation, protection or preservation of the Mortgaged Premises,
including the right to rent the same for the account of Grantor and to deduct
from such rents all costs, expenses and liabilities of every character incurred
by the Administrative Agent in collecting such rents and in managing, operating,
maintaining, protecting or preserving the Mortgaged Premises, and to apply the
remainder of such rents on the indebtedness secured hereby in such manner as the
Administrative Agent may elect. All such reasonable costs, expenses and
liabilities incurred by the Administrative Agent in collecting such rents and in
managing, operating, maintaining, protecting or preserving the Mortgaged
Premises, if not paid out of rents as hereinabove provided, shall constitute a
demand obligation owing by Grantor and the Obligors and shall draw interest from
the date of expenditure until paid at the highest rate for which Grantor and
Obligors may legally contract under applicable law, all of which shall
constitute a portion of the Said Indebtedness. If necessary to obtain the
possession provided for above, the Administrative Agent may invoke any and all
legal remedies to dispossess Grantor, including specifically one or more actions
for forcible entry and detainer, trespass to try title and restitution. In
connection with any action taken by the Administrative Agent pursuant to this
Paragraph 17, the Administrative Agent shall not be liable for any loss
sustained by Grantor, resulting from any failure to let the Mortgaged Premises,
or any part thereof, or from any other act or omission of the Administrative
Agent in managing the Mortgaged Premises unless such loss is caused by the
willful misconduct and bad faith of the Administrative Agent, nor shall the
Administrative Agent be obligated to perform or discharge any obligation, duty
or liability under any lease agreement covering the Mortgaged Premises or any
part thereof or under or by reason of this instrument or the exercise of rights
or remedies hereunder. Grantor and the Obligors shall and do hereby agree to
indemnify the Administrative Agent for, and to hold the Administrative Agent
harmless from, any and all liability, loss or damage which may or might be
incurred by the Administrative Agent under any such lease agreement or under or
by reason of this Deed of Trust or the exercise of rights or remedies hereunder
and from any and all claims and demands whatsoever which may be asserted against
the Administrative Agent by reason of any alleged obligations or undertakings on
its part to perform or discharge any of the terms, covenants or agreements
contained in any such lease agreement. GRANTOR'S AND THE OBLIGORS' OBLIGATION TO
SO INDEMNIFY THE ADMINISTRATIVE AGENT SHALL INCLUDE INDEMNIFICATION FOR ANY
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OF SUCH MATTERS CAUSED IN WHOLE OR IN PART BY THE NEGLIGENCE OF THE
ADMINISTRATIVE AGENT. Should the Administrative Agent incur any such liability,
the amount thereof, including costs, expenses and reasonable attorney's fees,
shall be secured hereby and Grantor and the Obligors shall reimburse the
Administrative Agent therefor immediately upon demand. Nothing in this Paragraph
17 shall impose any duty, obligation or responsibility upon the Administrative
Agent for the control, care, management or repair of the Mortgaged Premises, or
for the carrying out of any of the terms and conditions of any such lease
agreement; nor shall it operate to make the Administrative Agent responsible or
liable for any waste committed on the Mortgaged Premises by the tenants or by
any other parties or for any dangerous or defective condition of the Mortgaged
Premises, or for any negligence in the management, upkeep, repair or control of
the Mortgaged Premises resulting in loss or injury or death to any tenant,
licensee, employee or stranger. Grantor hereby assents to, ratifies and confirms
any and all actions of the Administrative Agent with respect to the Mortgaged
Premises taken under Paragraph 17.
18. NON-WAIVER. It is expressly agreed that (i) no waiver of any Default
on the part of Grantor or any of the Obligors or breach of any of the provisions
of this Deed of Trust shall be considered a waiver of any other or subsequent
Default or breach, and no delay or omission in exercising or enforcing the
rights and powers herein granted shall be construed as a waiver of such rights
and powers, and likewise no exercise or enforcement of any rights or powers
hereunder shall be held to exhaust such rights and powers, and every such right
and power may be exercised from time to time; (ii) any failure by Administrative
Agent to insist upon the strict performance by Grantor of any of the terms and
provisions hereof shall not be deemed to be a waiver of any of the terms and
provisions hereof, and Administrative Agent, notwithstanding any such failure,
shall have the right thereafter to insist upon the strict performance by Grantor
of any and all of the terms and provisions of this Deed of Trust; (iii) neither
Grantor nor any of the Obligors nor any other person now or hereafter obligated
for the payment of the whole or any part of Said Indebtedness shall be relieved
of such obligation by reason of the failure of Administrative Agent or Trustee
to comply with any request of Grantor, or any of the Obligors, or of any other
person so obligated, to take action to foreclose this Deed of Trust or otherwise
enforce any of the provisions of this Deed of Trust or of any obligations
secured by this Deed of Trust, or by reason of the release, regardless of
consideration, of the whole or any party of the security held for Said
Indebtedness, or by reason of the subordination in whole or in part by
Administrative Agent of the lien, security interest or rights evidenced hereby,
or by reason of any agreement or stipulation with any subsequent owner or owners
of the Mortgaged premises extending the time of payment or modifying the terms
of Said Indebtedness or this Deed of Trust without first having obtained the
consent of Grantor or the Obligors or such other person, and in the latter
event, Grantor, the Obligors and all such other persons shall continue to be
liable to make such payments according to the terms of any such agreement
-15-
of extension or modification unless expressly released and discharged in writing
by Administrative Agent; (iv) regardless of consideration and without the
necessity for any notice to or consent by the holder of any subordinate lien or
security interest on the Mortgaged Premises, Administrative Agent may release
the obligation of anyone at any time liable for any of Said Indebtedness or any
part of the security held for Said Indebtedness and may extend the time of
payment or otherwise modify the terms of Said Indebtedness and/or this Deed of
Trust without, as to the security or the remainder thereof, in anywise impairing
or affecting the lien or security interest of this Deed of Trust or the priority
of such lien or security interest, as security for the payment of Said
Indebtedness as it may be so extended or modified, over any subordinate lien or
security interest; (v) the holder of any subordinate lien or security interest
shall have no right to terminate any lease affecting the Mortgaged Premises
whether or not such lease be subordinate to this Deed of Trust; and (vi)
Administrative Agent may resort or the payment of Said Indebtedness to any
security therefor held by Administrative Agent in such order and manner as
Administrative Agent may elect.
19. APPRAISEMENT AND REDEMPTION LAWS. To the full extent Grantor may do
so, Grantor agrees that Grantor will not at any time insist upon, plead, claim
or take the benefit or advantage of any law now or hereafter in force providing
for any appraisement, valuation, stay, extension or redemption, and Grantor, for
Grantor and Grantor's representatives, successors and assigns, and for any and
all persons ever claiming any interest in the Mortgaged Premises, to the extent
permitted by law, hereby waives and releases all rights of redemption,
valuation, appraisement, stay of execution, notice of intention to mature or
declare due the whole or any part of the Said Indebtedness, notice of election
to mature or declare due the whole or any part of the Said Indebtedness and all
rights to a marshaling of the assets of Grantor, including the Mortgaged
Premises, or to a sale in inverse order of alienation in the event of
foreclosure of the liens and security interests hereby created. Grantor shall
not have or assert any right under any statute or rule of law pertaining to the
marshaling of assets, sale in inverse order of alienation, the exemption of
homestead, the administration of estates of decedents or other matters whatever
to defeat, reduce or affect the right of the Administrative Agent and the Banks
under the terms of this Deed of Trust to a sale of the Mortgaged Premises for
the collection of the Said Indebtedness without any prior or different resort
for collection, or the right of the Administrative Agent and the Banks under the
terms of this Deed of Trust to the payment of such indebtedness out of the
proceeds of sale of the Mortgaged Premises in preference to every other claimant
whatever. If any law referred to in this paragraph and now in force, of which
Grantor or Grantor's representatives, successors and assigns and such other
persons claiming any interest in the Mortgaged Premises might take advantage
despite this paragraph, shall hereafter be repealed or cease to be in force,
such law shall not thereafter be deemed to preclude the application of this
paragraph.
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20. RENEWAL AND EXTENSION. The Administrative Agent, without notice, may
release any part of the Mortgaged Premises, or any person liable on the Said
Indebtedness, without in any way affecting the lien hereof upon any portion of
the Mortgaged Premises not expressly released, and may agree with any party
obligated on Said Indebtedness, or having any interest in the Mortgaged
Premises, to renew and extend the time or manner of payment of all or any part
of Said Indebtedness. Such agreement shall not in any way release or impair the
lien hereof, but shall renew and extend the lien hereof against the Mortgaged
Premises without altering or affecting the priority of the lien created by this
Deed of Trust in favor of any junior encumbrancer, mortgagee or purchaser, or
any person acquiring an interest in the Mortgaged Premises, and this Deed of
Trust shall remain first and superior to any liens that may be placed thereon,
or that may be fixed, given or imposed by law thereon after the execution of
this instrument notwithstanding any such extension of the time of payment, or
the release of a portion of said property from this lien.
21. SALE AND ADDITIONAL ENCUMBRANCES. Grantor hereby expressly agrees
that in the event the following occurs (hereinafter referred to as a "Transfer")
without the prior written consent of Administrative Agent, except as expressly
provided otherwise in the Credit Agreement, whether by a direct or indirect
method, then, in any such event, the Administrative Agent shall have the right,
for the benefit of the Banks, at its option, to declare the entire amount of
Said Indebtedness to be immediately due and payable, and the liens and security
interests evidenced hereby shall be subject to foreclosure in any manner
provided for herein or provided for by law as the Administrative Agent may
elect:
(a) Grantor shall cease to own the entire actual and beneficial title
and interest to all of the Mortgaged Premises, free and clear from all
liens, security interests and encumbrances except (i) the lien and
security interest evidenced by this Deed of Trust and (ii) such other
matters as are expressly permitted hereunder or in the Credit
Agreement;
(b) If any entity who has acquired title to the Mortgaged Premises (a
"Transferee") as a result of a transfer that has been approved by
Administrative Agent (a "Permitted Transfer") shall cease to own the
entire actual and beneficial title and interest to all of the
Mortgaged Premises, free and clear from all liens, security interests
and encumbrances except (i) the lien and security interest evidenced
by this Deed of Trust, and (ii) such other matters as are expressly
permitted hereunder or in the Credit Agreement;
(c) Except as provided otherwise in the Credit Agreement, if any one of
the following shall occur with respect to Grantor or any Transferee
during the period of time preceding the date on which Grantor or any
such Transferee,
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as the case may be, transfers title to the Mortgaged Premises as a
result of a Permitted Transfer:
(i) If Grantor or any Transferee is a general partnership, limited
partnership, or joint venture and Grantor or said Transferee
dissolves, terminates, liquidates or ceases to be a general
partnership, limited partnership or joint venture, as the case
may be, duly organized and validly existing under the laws of
the state of its creation pursuant to a partnership or joint
venture agreement that has been approved in writing by
Administrative Agent or if the general partners or joint
venturers of said partnership or joint venture change from
individuals or entities that have been approved in writing by
Administrative Agent;
(ii) If Grantor or any Transferee is a corporation and said
corporation shall dissolve, merge, liquidate or cease to be a
corporation duly organized and validly existing under the laws
of the state of its incorporation;
(iii) If Grantor or any Transferee is a general partnership, limited
partnership or joint venture and there shall be a transfer of
any of the general partnership interest or joint venture
interest in Grantor or said Transferee;
(iv) If Grantor or any Transferee is a corporation and there is a
transfer of any of the stock of said corporation or the
issuance of new stock of said corporation; or
(d) Except as provided otherwise in the Credit Agreement, if Grantor or
any Transferee shall enter into any contractual arrangement to sell,
transfer, convey or mortgage all or any part of the actual or
beneficial title and interest to the Mortgaged Premises that is not
expressly conditioned upon the consent of Administrative Agent to the
transaction contemplated thereby.
Administrative Agent, for the benefit of the Banks, shall have such right and
option to declare the entire amount of Said Indebtedness to be immediately due
and payable, irrespective of whether or not any such Transfer would or might (i)
diminish the value of any security for the Said Indebtedness, (ii) increase the
risk of default under this instrument, (iii) increase the likelihood of
Administrative Agent's having to resort to any security for the Said
Indebtedness after default, or (iv) add or remove the liability of any person or
entity for
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payment or performance of the Said Indebtedness or any covenant or obligation
under this Deed of Trust. Except where Administrative Agent's consent is not
required pursuant to the Credit Agreement, if Administrative Agent's consent to
a proposed Transfer is requested, Administrative Agent shall have the right (in
addition to its absolute right to refuse to consent to any such Transfer) to
condition its consent upon satisfaction of any one or more of the following
requirements:
(a) That the interest rate on the Notes be increased to a rate acceptable
to Administrative Agent and the Banks, but not in access of the
Default Rate; or
(b) That a reasonable transfer fee, in an amount determined by
Administrative Agent be paid; or
(c) That a principal amount deemed appropriate by Administrative Agent be
paid against said Notes; or
(d) That Grantor and each proposed transferee execute such Assumption
Agreement and other instruments as Administrative Agent shall require.
22. GRANTOR NOT RELEASED. In the event the Administrative Agent approves a
future conveyance of the Mortgaged Premises, or any part thereof, and title
becomes vested in a person other than Grantor, the Administrative Agent may,
without notice to Grantor, deal with such successor or successors in interest
with reference to this Deed of Trust and to the Notes in the same manner as with
Grantor without in any way vitiating or discharging Grantor's and the Obligors'
liability hereunder or upon Said Indebtedness. No sale of the Mortgaged Premises
and no forbearance on the part of the Administrative Agent and no extension of
the time for the payment of the Notes, given by the Administrative Agent and the
Obligors, shall operate to release, modify, change or affect the original
liability of Grantor, either in whole or in part.
23. ACCEPTANCE ON ACCOUNT. Acceptance by the Administrative Agent or any
of the Banks of any payment in an amount less than the amount then due on Said
Indebtedness shall be deemed an acceptance on account only, and the failure to
pay the entire amount then due shall be and continue to be a Default; at any
time thereafter, and until the entire amount then due on the Said Indebtedness
has been paid, the Administrative Agent shall be entitled to exercise all rights
conferred upon it in this Deed of Trust.
24. SECURITY INTEREST. To further secure Said Indebtedness, Grantor hereby
grants a security interest to Administrative Agent, for its benefit and the
ratable
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benefit of the Banks, in and to the Income and all personal property and
fixtures hereinabove described and all of Grantor's bank accounts including
without limitation the Grantor's Concentration Bank Account (all of such Income,
personal property, fixtures and the proceeds thereof and bank accounts being
herein called the "collateral," but the mention of proceeds of collateral herein
shall not be construed as an authorization for the sale or surrender by Grantor
of collateral and collateral as used in this Deed of Trust shall be included in
the term "Mortgaged Premises" when used herein). This document shall constitute
a security agreement as well as a mortgage and deed of trust. The following
applies with respect to collateral:
(a) In addition to and cumulative of any other remedies granted in this
Deed of Trust to Administrative Agent, Administrative Agent may, upon
Default hereunder, proceed under the Code as to all or any part of the
collateral and shall have and may exercise with respect to all or any
part of the collateral all of the rights, remedies and powers of a
secured party under the Code, including, without limitation, the right
and power to repossess, retain and sell, at public or private sale or
sales, or otherwise dispose of, lease or utilize the collateral or any
part thereof and to dispose of the proceeds in any manner authorized
or permitted under the applicable provisions of the Code, and to apply
the proceeds thereof toward payment of Administrative Agent's
reasonable attorney's fees and other expenses and costs of pursuing,
searching for, receiving, taking, keeping, storing, advertising, and
selling the collateral thereby incurred by Administrative Agent, and
toward payment of Said Indebtedness in such order and manner as
Administrative Agent may elect consistent with the provisions of the
Code. Nothing in this Paragraph 24 shall be construed to impair or
limit any other right or power to which Administrative Agent may be
entitled at law or in equity.
(b) Among the rights of Administrative Agent upon Default, and without
limitation, Administrative Agent shall have the right (but not the
obligation), without being deemed guilty of trespass and without
liability for damages thereby occasioned, (i) to enter upon any
premises where said collateral may be situated and take possession of
the collateral, or render it unusable, or dispose of the collateral on
Grantor's premises, and Grantor agrees not to resist or to interfere
and (ii) to take any action deemed necessary or appropriate or
desirable by Administrative Agent and at Administrative Agent's
option, and in its discretion, to repair, refurbish or otherwise
prepare the collateral for sale, lease or other use or disposition as
herein authorized. Administrative Agent may at Administrative Agent's
discretion require Grantor to assemble the collateral and make it
available to Administrative
-20-
Agent at a place designated by Administrative Agent that is reasonably
convenient to both parties.
(c) Administrative Agent shall give Grantor notice, by certified mail,
postage prepaid, of the time and place of any public sale of any of
the collateral or of the time after which any private sale or other
intended disposition thereof is to be made by sending notice to
Grantor at the address of Grantor set out below opposite its signature
at least five (5) days before the time of the sale or other
disposition, which provisions for notice Grantor and Administrative
Agent agree are reasonable; provided, however, that nothing herein
shall preclude Administrative Agent from proceeding as to both real
and personal property in accordance with Administrative Agent's rights
and remedies in respect to real property as provided in the Code, and
without any notice to Grantor except for the notice provided for in
Paragraph 8 hereof.
(d) To the extent such may now or hereafter be permitted under the laws of
the state in which the Mortgaged Premises are located, Administrative
Agent is authorized to execute and file financing statements and
continuation statements under the Code with respect to the collateral
without joinder of Grantor in such execution or filing. Grantor shall
execute and deliver to Administrative Agent such financing statements,
continuation statements and other documents relating to the collateral
as Administrative Agent may reasonably request from time to time to
preserve and maintain the priority of the security interest created by
this Deed of Trust and shall pay to Administrative Agent on demand any
expenses and attorneys' fees incurred by Administrative Agent in
connection with the preparation, execution and filing of this Deed of
Trust and of any financing statements, continuation statements,
partial releases, termination statements or other documents necessary
or desirable to continue or confirm Administrative Agent's security
interest or any modification thereof. This document, and any carbon,
photographic or other reproduction of this document may be filed by
Administrative Agent and shall be sufficient as a financing statement.
All or part of the collateral is or is to become fixtures, crops,
timber or minerals on the real estate constituting a portion of the
Mortgaged Premises, but this statement shall not impair or limit the
effectiveness of this document as a security agreement or financing
statement, for other purposes, and this Deed of Trust shall constitute
a fixture, crops, timber and mineral financing statement and, as such,
shall be filed for record in the real estate records of the county in
which the land covered hereby is located. Grantor shall not change its
name without the prior express written consent of Administrative
-21-
Agent which shall not be unreasonably withheld. The name of the record
owner of the land covered hereby is the party defined as Grantor.
(e) Unless otherwise disclosed to Administrative Agent as herein provided,
Grantor agrees that, except for the security interest granted hereby
in the collateral, Grantor is the owner of the collateral free of any
adverse claim, security interest or encumbrance, and Grantor shall
defend the collateral against all claims and demands of any person at
any time claiming the same or any interest therein. Grantor has not
heretofore signed any financing statement and no financing statement
signed by Grantor is now on file in any public office except those
statements, true and correct copies of which have been delivered to
Administrative Agent. So long as any amount remains unpaid on Said
Indebtedness, Grantor shall not except in connection with those Liens
expressly permitted by the Credit Agreement execute and there shall
not be filed in any public office any such financing statement or
statements affecting the collateral other than financing statements in
favor of Administrative Agent hereunder.
(f) The security interest granted herein shall not be construed or deemed
to constitute Administrative Agent or Trustee as a trustee or
mortgagee in possession of the Mortgaged Premises so as to obligate
Administrative Agent or Trustee to lease the Mortgaged Premises or
attempt to do the same, or to take any action, incur any expenses or
perform or discharge any obligation, duty or liability with respect to
the Mortgaged Premises or any part thereof or otherwise.
(g) Grantor's and Administrative Agent's addresses are as hereinbelow set
forth.
Without limitation, the "collateral" also includes all right, title and interest
now owned or hereafter acquired by Grantor in and to the following described
property and all replacements or substitutions thereof and all products and
proceeds thereof:
(a) All contracts now or hereafter entered into by and between Grantor and
any contractor or supplier as well as all right, title and interest of
Grantor under any subcontracts, providing for the construction
(original, restorative or otherwise) of any improvements to or on any
of the Mortgaged Premises or the furnishing of any materials,
supplies, equipment or labor in connection with such construction;
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(b) All of the plans, specifications and drawings (including, but not
limited to plot plans, foundations plans, floor plans, elevations,
framing plans, cross-sections of walls, mechanical plans, electrical
plans and architectural and engineering plans, and architectural and
engineering studies and analyses) heretofore or hereafter prepared by
any architect or engineer, in respect of any of the Mortgaged
Premises;
(c) All agreements now or hereafter entered into with any party in respect
of architectural, engineering, management or consulting services
rendered or to be rendered in respect of planning, design, inspection
or supervision of the construction or management of any of the
Mortgaged Premises;
(d) Any commitment issued by any lender or investor other than
Administrative Agent to finance or invest in any of the Mortgaged
Premises.
(e) Any completion bond, performance bond or labor and material payment
bond and any other bond relating to the Mortgaged Premises or to any
contract providing for construction of improvements to any of the
Mortgaged Premises.
To the extent that any of the collateral is not subject to the Uniform
Commercial Code of the state or states where it is situated, Grantor hereby
assigns to Administrative Agent all of Grantor's right, title and interest in
the collateral to secure the Said Indebtedness. Release of the lien of this Deed
of Trust shall automatically terminate this assignment.
25. EXCESS INTEREST. The invalidity, or unenforceability in particular
circumstances, of any provision of this Deed of Trust shall not extend beyond
such provision or such circumstances and no other provision of this instrument
shall be affected thereby. As used herein, the term "Maximum Legal Rate of
Interest" shall mean and refer to the maximum rate of nonusurious interest, if
any, that Administrative Agent may from time to time charge Grantor and the
Obligors and in regard to which Grantor and the Obligors would be prevented
successfully from raising the claim or defense of usury under applicable law as
now, or to the extent permitted by law, as may hereafter be, in effect (said law
permitting the highest rate being herein referred to as the "Interest Law").
Unless changed in accordance with law, the applicable rate ceiling under Texas
law shall be indicated (weekly) rate ceiling, from time to time in effect, as
provided in Article 5069-1.04 of the Texas Revised Civil Statues, as amended. It
is the intention of Grantor, the Obligors and Administrative Agent to conform
strictly to the Interest Law applicable to this loan transaction. Accordingly,
it is agreed that notwithstanding any provision to the contrary in this Deed of
Trust, the Notes or in any of the documents securing payment of Said
-23-
Indebtedness or otherwise relating thereto, the aggregate of all interest and
any other charges or consideration constituting interest under applicable
Interest Law that is taken, reserved, contracted for, charged or received under
this Deed of Trust, or under any of the other aforesaid agreements or otherwise
in connection with this loan transaction shall under no circumstances exceed the
maximum amount of interest allowed by the Interest Law applicable to this loan
transaction. If any excess of interest in such respect is provided for, or shall
be adjudicated to be so provided for, in this Deed of Trust, in the Notes or in
any of the documents securing payment of Said Indebtedness or otherwise relating
thereto, then in such event (a) the provisions of this paragraph shall govern
and control, (b) neither Grantor, the Obligors nor their respective heirs, legal
representatives, successors or assigns or any other party liable for the payment
of Said Indebtedness shall be obligated to pay the amount of such interest to
the extent that it is excess of the maximum amount of interest allowed by the
Interest Law applicable to this loan transaction, (c) any excess shall be deemed
a mistake and canceled automatically and, if theretofore paid, shall be credited
on Said Indebtedness by Administrative Agent (or if Said Indebtedness shall have
paid in full, refunded to Grantor or the Obligors, as applicable) and (d) the
effective rate of interest shall be automatically subject to reduction to the
Maximum Legal Rate of Interest allowed under such Interest Law as now or
hereafter construed by courts of appropriate jurisdiction. All sums paid or
agreed to be paid the Administrative Agent for the use, forbearance or detention
of the indebtedness secured hereby shall, to the extent permitted by the
Interest Law applicable to this loan transaction, be amortized, prorated,
allocated and spread throughout the full term of the Note.
26. PARTIAL INVALIDITY. If the lien of this Deed of Trust is invalid or
unenforceable as to any part of the Notes or indebtedness secured hereby, or if
the lien is invalid or unenforceable as to any part of the Mortgaged Premises,
the unsecured or partially unsecured portion of the Notes or indebtedness shall
be completely paid prior to the payment of the remaining and secured or
partially secured portion of the Notes or indebtedness, and payments made on the
Notes or indebtedness, whether voluntary or under foreclosure or other
enforcement action or procedure, shall be considered to have been first paid on
and applied to the full payment of that portion of the Notes or indebtedness
which is not secured or fully secured by the lien of this Deed of Trust.
27. REINSTATEMENT. In the event Administrative Agent shall elect to
invoke any of the rights or remedies provided for herein, but shall thereafter
determine to withdraw or discontinue same for any reason, it shall have the
unqualified right to do so, whereupon all parties shall be automatically
restored and returned to their respective positions regarding the Said
Indebtedness and this document as shall have existed prior to the invocation of
Administrative Agent's rights hereunder and the rights, powers and remedies of
Administrative Agent hereunder shall be and remain in full force and effect.
-24-
28. FURTHER DOCUMENTS. Grantor agrees that it shall execute and deliver
such other and further documents and do and perform such other acts as may be
reasonably necessary and proper to carry out the intention of the parties as
herein expressed and to effect the purposes of this document and the loan
transaction referred to herein. Without limitation of the foregoing, Grantor
agrees to execute and deliver such documents as may be necessary to cause the
liens and security interests granted hereby to cover and apply to any property
placed in, on or about the Mortgaged Premises in addition to, or replacement or
substitution of any of the Mortgaged Premises.
29. SUCCESSORS AND ASSIGNS. The covenants herein contained shall inure to
the benefit of Administrative Agent, the Banks and Trustee, their respective
heirs, legal representatives, successors and assigns, and shall be binding upon
the respective heirs, legal representatives, successors and assigns of Grantor
[AND BORROWER], but nothing in this paragraph shall constitute an authorization
for Grantor to sell or in any way dispose of the Mortgaged Premises or any part
thereof.
30. TERMINOLOGY. Whenever used in this document, unless the context
clearly indicates a contrary intent or unless otherwise specifically provided
herein, the words "Deed of Trust" shall mean this Deed of Trust and Security
Agreement and any supplement or supplements hereto, the word "Grantor" shall
mean "Grantor, its heirs, legal representatives, successors and assigns, and/or
any subsequent owner or owners of the Mortgaged Premises," the word
"Administrative Agent" shall mean "Administrative Agent or any subsequent
Administrative Agent under the Credit Agreement," the word "Notes" shall mean
"Notes secured by this Deed of Trust and any renewals, extensions and
rearrangements thereof," the word "Person" shall mean "an individual,
corporation, trust, partnership or unincorporated association," the word
"Obligors" shall mean "Obligors, their respective heirs, legal representatives,
successors and assigns," and the pronouns of any gender shall include the other
genders, and either the singular or plural shall include the other.
31. HEADINGS. The paragraph entitlements hereof are inserted for
convenience of reference only and shall in no way alter, modify or define, or be
used in construing, the text of such paragraphs.
32. WARRANTIES OF TITLE. Notwithstanding anything to the contrary herein
set forth, the warranties of title herein contained are subject to those matters
set forth on Exhibit "B" attached hereto and made a part hereof for all
-----------
purposes, to the extent, but only to the extent, the same are valid and
subsisting and affect the Mortgaged Premises.
33. CREDIT AGREEMENT. It is expressly agreed that the Notes evidence a
loan from Administrative Agent and the Banks to [GRANTOR/BORROWER] pursuant to
----------------
the terms
-25-
of the Credit Agreement, which Credit Agreement is hereby incorporated herein
for all purposes as if set forth herein in its entirety. To the extent the
specific terms and provisions of this Deed of Trust expressly conflict with the
specific terms and provisions of said Credit Agreement, the specific terms and
provisions of said Credit Agreement shall control.
34. TIME IS OF THE ESSENCE. Time is of the essence in this Deed of Trust.
35. CHOICE OF LAW. To the extent, and only to the extent, that an
election of the laws of a forum other than ___________ would be ineffective
under _____________ law, the validity, construction, and enforcement of this
instrument shall be governed by the laws of the State of _____________
applicable to contracts executed and performed entirely within that state with
respect to real estate remedies, perfection and other matters so inherently
local that an election of the laws of a forum other than _______________ would
be ineffective under _____________ law. In all other respects, including, but
not limited to, matters of usury law and general contract law applicable to
agreements between lenders and borrowers, the validity, construction and
enforcement hereof shall be determined according to the substantive laws (but
not the conflicts laws) of the State of Texas, in which state the Administrative
Agent and the Banks originated the Said Indebtedness and in which state the
Notes are payable.
[36. COVENANTS, REPRESENTATIONS AND AGREEMENTS OF GRANTOR WITH RESPECT TO
THE GROUND LEASE.
(A) THE GRANTOR REPRESENTS AND WARRANTS THAT (I) THE GROUND LEASE IS IN
FULL FORCE AND EFFECT, (II) THE GROUND LEASE HAS NOT BEEN MODIFIED IN
ANY RESPECT AND (III) TO ITS KNOWLEDGE THERE ARE NO DEFAULTS BY EITHER
PARTY TO THE GROUND LEASE.
(B) THE GRANTOR SHALL PERFORM AND/OR OBSERVE ALL COVENANTS AND CONDITIONS
TO BE PERFORMED AND/OR OBSERVED BY THE GRANTOR UNDER THE GROUND LEASE
AND SHALL DELIVER TO ADMINISTRATIVE AGENT PHOTOCOPIES OF ALL NOTICES
RECEIVED BY THE GRANTOR FROM THE LESSOR UNDER THE GROUND LEASE WITHIN
FIVE (5) DAYS AFTER RECEIPT THEREOF.
(C) SIMULTANEOUSLY WITH THE MAKING OF EACH PAYMENT TO THE LESSOR UNDER THE
GROUND LEASE, THE GRANTOR SHALL DELIVER TO THE ADMINISTRATIVE AGENT A
COPY OF THE CHECK IN THE AMOUNT OF SUCH PAYMENT DELIVERED TO THE
LESSOR UNDER THE GROUND LEASE.
-26-
(D) IF THERE SHALL BE FILED BY OR AGAINST THE GRANTOR A PETITION UNDER THE
REVISED BANKRUPTCY ACT OF 1978, ET. SEQ., AS AMENDED AND ANY SUCCESSOR
--- -----
ACT THERETO (THE "BANKRUPTCY CODE") AND THE GRANTOR, SHALL DETERMINE
TO REJECT THE GROUND LEASE, THE GRANTOR SHALL GIVE THE ADMINISTRATIVE
AGENT NOT LESS THAN FIFTEEN (15) DAYS' PRIOR WRITTEN NOTICE OF THE
DATE ON WHICH THE GRANTOR SHALL APPLY TO ANY COURT OR OTHER
GOVERNMENTAL AUTHORITY FOR AUTHORITY AND PERMISSION TO REJECT THE
GROUND LEASE. THE ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT, BUT NOT
THE OBLIGATION, TO SERVE UPON THE GRANTOR WITHIN SUCH FIFTEEN (15) DAY
PERIOD A NOTICE STATING THAT (I) THE ADMINISTRATIVE AGENT DEMANDS THAT
THE GRANTOR ASSUME AND ASSIGN THE GROUND LEASE TO THE ADMINISTRATIVE
AGENT PURSUANT TO THE BANKRUPTCY CODE, AND (II) THE ADMINISTRATIVE
AGENT COVENANTS TO CURE AND/OR PROVIDE ADEQUATE ASSURANCE OF PROMPT
CURE OF ALL DEFAULTS REASONABLY SUSCEPTIBLE OF BEING CURED BY THE
ADMINISTRATIVE AGENT AND OF FUTURE PERFORMANCE UNDER THE GROUND LEASE.
IF THE ADMINISTRATIVE AGENT SERVES UPON THE GRANTOR THE NOTICE
DESCRIBED ABOVE, THE GRANTOR SHALL NOT SEEK TO REJECT THE GROUND LEASE
AND SHALL COMPLY WITH THE DEMAND PROVIDED FOR IN CLAUSE (I) ABOVE
WITHIN FIFTEEN (15) DAYS AFTER THE NOTICE SHALL HAVE BEEN GIVEN BY THE
ADMINISTRATIVE AGENT.
(E) THE GRANTOR HEREBY IRREVOCABLY APPOINTS THE ADMINISTRATIVE AGENT ITS
AGENT AND ATTORNEY-IN-FACT (WHICH APPOINTMENT IS COUPLED WITH AN
INTEREST) TO PERFORM OR OBSERVE ON BEHALF OF THE GRANTOR, THE
GRANTOR'S OPTION TO PURCHASE THE MORTGAGED PREMISES (IF ANY), PURSUANT
TO THE GROUND LEASE, AND ANY COVENANT OR CONDITION WHICH THE GRANTOR
FAILS TO PERFORM OR OBSERVE UNDER THE GROUND LEASE WITHIN ANY
APPLICABLE GRACE PERIOD SPECIFIED IN THE GROUND LEASE, AND ANY
ADVANCES MADE BY THE ADMINISTRATIVE AGENT IN CONNECTION WITH SUCH
PERFORMANCE OR OBSERVANCE SHALL BE REPAID BY THE GRANTOR [AND
BORROWER] WITHIN TEN (10) DAYS OF DEMAND WITH INTEREST AT THE INTEREST
RATE TO BE PAID UNDER THE CREDIT AGREEMENT DURING AN EVENT OF DEFAULT
(THE "DEFAULT RATE") AND THE AMOUNT SO ADVANCED, AND SHALL BE A LIEN
UPON THE MORTGAGED PREMISES, OR ANY PART THEREOF, AND SHALL BE SECURED
BY THIS DEED OF TRUST. SUCH PERFORMANCE OR OBSERVANCE BY THE
ADMINISTRATIVE AGENT SHALL NOT PREVENT THE GRANTOR'S FAILURE SO TO
PERFORM OR OBSERVE FROM CONSTITUTING A DEFAULT UNDER THIS DEED OF
TRUST. IN PERFORMING OR OBSERVING ANY SUCH COVENANT OR CONDITION, THE
ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT TO ENTER UPON THE MORTGAGED
PREMISES OR ANY PART THEREOF. UPON RECEIPT BY THE ADMINISTRATIVE AGENT
FROM THE LESSOR UNDER THE GROUND LEASE OF ANY
-27-
NOTICE OF DEFAULT UNDER THE GROUND LEASE, THE ADMINISTRATIVE AGENT MAY
RELY THEREON AND TAKE ANY ACTION PERMITTED BY THIS SECTION TO REMEDY
SUCH DEFAULT NOTWITHSTANDING THAT THE EXISTENCE OF SUCH DEFAULT OR THE
NATURE THEREOF MAY BE QUESTIONED OR DENIED BY THE GRANTOR.
(F) IF THE GRANTOR EXERCISES THE OPTION TO PURCHASE THE MORTGAGED PREMISES
(IF ANY), PURSUANT TO THE GROUND LEASE, SUCH PURCHASE OF THE MORTGAGED
PREMISES SHALL IMMEDIATELY BECOME SUBJECT TO THE LIEN HEREOF, AND
SECURED BY THIS DEED OF TRUST AS FULLY AND COMPLETELY, AND WITH THE
SAME EFFECT, AS THOUGH NOW OWNED BY THE GRANTOR AND SPECIFICALLY
DESCRIBED IN THE GRANTING CLAUSE HEREOF. NOTWITHSTANDING THE
FOREGOING, AT ANY AND ALL TIMES, THE GRANTOR SHALL EXECUTE, DELIVER
AND ACKNOWLEDGE SUCH FURTHER ASSURANCES, DEED OF TRUSTS AND/OR
SECURITY INSTRUMENTS THE ADMINISTRATIVE AGENT MAY REQUIRE TO CONFIRM
THE MORTGAGED PREMISES SO PURCHASED ARE SECURED BY THE LIEN OF THIS
DEED OF TRUST.
(G) THE GRANTOR EXPRESSLY AGREES THAT IF THERE SHALL BE FILED BY OR
AGAINST THE LESSOR UNDER THE GROUND LEASE ANY PETITION, ACTION AND/OR
PROCEEDING UNDER THE BANKRUPTCY CODE OR ANY OTHER SIMILAR FEDERAL AND
OR STATE LAW NOW OR HEREAFTER IN EFFECT (COLLECTIVELY HEREINAFTER
REFERRED TO AS THE "GRANTOR'S BANKRUPTCY"), THE GRANTOR SHALL NOT
ELECT TO TREAT THE GROUND LEASE AS TERMINATED, CANCELED AND/OR
SURRENDERED PURSUANT TO APPLICABLE PROVISIONS OF THE BANKRUPTCY CODE
INCLUDING, BUT NOT LIMITED TO, SECTION 365(H)(1), WITHOUT THE
ADMINISTRATIVE AGENT'S PRIOR WRITTEN CONSENT. IN THE EVENT OF THE
GRANTOR'S BANKRUPTCY, THE GRANTOR EXPRESSLY COVENANTS AND AGREES,
INTENDING THAT THE ADMINISTRATIVE AGENT RELY THEREON, THAT IT SHALL
REAFFIRM AND RATIFY THE LEGALITY, VALIDITY, BINDING EFFECT AND
ENFORCEABILITY OF THE GROUND LEASE TO THE ADMINISTRATIVE AGENT AND THE
GRANTOR ALSO COVENANTS AND AGREES THAT IT SHALL REMAIN IN POSSESSION
OF THE MORTGAGED PREMISES AND THE LEASEHOLD ESTATE CREATED BY THE
GROUND LEASE, NOTWITHSTANDING ANY REJECTION THEREOF BY THE LESSOR
UNDER THE GROUND LEASE AND/OR ANY TRUSTEE, CUSTODIAN, RECEIVER OR
OTHER SIMILAR OFFICIAL.
(H) THE LIEN OF THIS DEED OF TRUST ATTACHES TO ALL OF THE GRANTOR'S RIGHTS
AND REMEDIES NOW AND HEREAFTER ARISING UNDER OR PURSUANT TO THE
BANKRUPTCY CODE, INCLUDING, BUT NOT LIMITED TO, THE GRANTOR'S RIGHT TO
ELECT TO REMAIN IN POSSESSION OF THE MORTGAGED PREMISES AND THE
LEASEHOLD ESTATE CREATED BY THE GROUND LEASE IN THE EVENT OF THE
GRANTOR'S BANKRUPTCY PURSUANT TO SECTION 365(H)(1). ANY SUCH ELECTION
-28-
TO TERMINATE, CANCEL AND/OR SURRENDER THE GROUND LEASE IN THE EVENT OF
THE GRANTOR'S BANKRUPTCY WITHOUT THE ADMINISTRATIVE AGENT'S PRIOR
WRITTEN CONSENT SHALL BE NULL AND VOID.
(I) THE GRANTOR HEREBY UNCONDITIONALLY ASSIGNS, TRANSFERS, AND SETS OVER
TO THE ADMINISTRATIVE AGENT FOR THE BENEFIT OF THE BANKS (I) ALL OF
THE GRANTOR'S CLAIMS AND RIGHTS TO DAMAGES, AND ANY OTHER REMEDIES IN
CONNECTION THEREWITH ARISING FROM ANY REJECTION OF THE GROUND LEASE BY
THE LESSOR THEREUNDER PURSUANT TO THE BANKRUPTCY CODE IN THE EVENT OF
THE GRANTOR'S BANKRUPTCY, AND/OR BY ANY TRUSTEE, CUSTODIAN, RECEIVER
OR OTHER SIMILAR OFFICIAL. THE ADMINISTRATIVE AGENT SHALL HERE THE
RIGHT, BUT NOT THE OBLIGATION, TO PROCEED IN ITS OWN NAME AND/OR IN
THE NAMES OF THE GRANTOR IN RESPECT OF ANY CLAIM, SUIT, ACTION AND/OR
PROCEEDING RELATING TO SUCH REJECTION OF THE GROUND LEASE, INCLUDING,
BUT NOT LIMITED TO, THE RIGHT TO FILE AND PROSECUTE, TO THE EXCLUSION
OF THE GRANTOR, ANY AND ALL PROOFS OF CLAIMS, COMPLAINTS, NOTICES AND
OTHER DOCUMENTS IN ANY CASE IN RESPECT OF THE LESSOR OF THE GROUND
LEASE UNDER AND PURSUANT TO THE BANKRUPTCY CODE, AND (II) THE
GRANTOR'S RIGHT OF ELECTION TO REMAIN IN POSSESSION OF THE MORTGAGED
PREMISES IN THE EVENT OF THE GRANTOR'S BANKRUPTCY UNDER AND PURSUANT
TO SECTION 365(H)(L) OF THE BANKRUPTCY CODE. THIS ASSIGNMENT
CONSTITUTES A PRESENT, ABSOLUTE, IRREVOCABLE AND UNCONDITIONAL
ASSIGNMENT OF THE FOREGOING CLAIMS, ELECTIONS, RIGHTS AND REMEDIES,
AND SHALL CONTINUE IN FULL FORCE AND EFFECT UNTIL THE NOTES AND THE
SAID INDEBTEDNESS HAVE BEEN PAID IN FULL AND THIS DEED OF TRUST HAS
BEEN SATISFIED AND DISCHARGED. ANY AMOUNTS RECEIVED BY THE
ADMINISTRATIVE AGENT AND THE BANKS AS DAMAGES ARISING OUT OF THE
REJECTION OF THE GROUND LEASE BY THE LESSOR THEREUNDER SHALL BE
APPLIED IN THE MANNER SET FORTH IN PARAGRAPH 9 OF THIS DEED OF TRUST.
(J) IF, PURSUANT TO ANY APPLICABLE SECTION OF THE BANKRUPTCY CODE, THE
GRANTOR SEEKS TO OFFSET, COUNTERCLAIM, DEDUCT, AND/OR ASSERTS A
DEFENSE AGAINST THE RENT, ADDITIONAL RENT OR OTHER SUMS DUE UNDER THE
GROUND LEASE, THE AMOUNT OF ANY DAMAGES CAUSED BY THE NON-OBSERVANCE
AND/OR NON-PERFORMANCE OF THE LESSOR UNDER THE GROUND LEASE, THE
GRANTOR SHALL, PRIOR TO SUCH OFFSET, COUNTERCLAIM, DEFENSE AND/OR
DEDUCTION NOTIFY THE ADMINISTRATIVE AGENT OF ITS INTENT TO DO SO,
SETTING FORTH WITH SPECIFICITY THE AMOUNTS PROPOSED TO BE OFFSET,
COUNTERCLAIMED, DEDUCTED, AND/OR DEFENDED AGAINST AND FOR WHAT
PURPOSES. THE ADMINISTRATIVE AGENT FOR THE BENEFIT OF THE BANKS SHALL
THEREUPON HAVE THE RIGHT, BUT NOT THE OBLIGATION, TO OBJECT TO ALL OR
ANY PART OF SUCH OFFSET, COUNTERCLAIM
-29-
AND/OR DEDUCTION AND, IN THE EVENT OF SUCH OBJECTION, THE GRANTOR
SHALL NOT EFFECT ANY SUCH OFFSET COUNTERCLAIM AND/OR DEDUCTION.
NEITHER THE ADMINISTRATIVE AGENT'S FAILURE TO OBJECT TO ANY SUCH
OFFSET, COUNTERCLAIM AND/OR DEDUCTION NOR ANY OBJECTION OR OTHER
COMMUNICATION BETWEEN THE ADMINISTRATIVE AGENT AND THE GRANTOR SHALL
CONSTITUTE AN APPROVAL OF ANY SUCH OFFSET, COUNTERCLAIM, DEDUCTION
AND/OR DEFENSE BY THE ADMINISTRATIVE AGENT. THE GRANTOR [AND BORROWER]
EXPRESSLY AGREE[S] TO PAY, PROTECT, INDEMNIFY AND SAVE HARMLESS THE
ADMINISTRATIVE AGENT FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS,
ACTIONS, SUIT, PROCEEDINGS, DAMAGES, LOSSES, LIABILITIES, JUDGMENTS,
COSTS AND EXPENSES OF EVERY KIND AND NATURE (INCLUDING REASONABLE
ATTORNEYS' FEES) ARISING FROM OR RELATING TO ANY OFFSET, COUNTERCLAIM
DEDUCTION AND/OR ASSERTION OF A DEFENSE BY THE GRANTOR AS HEREIN
DESCRIBED.
(K) IF ANY ACTION, PROCEEDING, MOTION AND/OR NOTICE SHALL BE COMMENCED OR
FILED WITH RESPECT TO THE GRANTOR OR THE MORTGAGED PREMISES, OR ANY
PART THEREOF, IN CONNECTION WITH THE BANKRUPTCY CODE, THE
ADMINISTRATIVE AGENT SHALL BE ENTITLED TO APPROVE OF GRANTOR'S
SELECTION OF ANY COUNSEL RETAINED IN CONNECTION THEREWITH AND SHALL
ALSO HAVE APPROVAL RIGHTS OVER ALL ASPECTS OF ANY ENSUING LITIGATION.
ALTERNATIVELY, THE ADMINISTRATIVE AGENT MAY PROCEED IN ITS OWN NAME IN
CONNECTION WITH ANY SUCH LITIGATION, AND THE GRANTOR EXPRESSLY AGREES
TO EXECUTE AND DELIVER ALL AND EVERY POWER, CONSENT, AUTHORIZATION AND
OTHER DOCUMENTS REQUIRED BY THE ADMINISTRATIVE AGENT IN CONNECTION
THEREWITH. THE GRANTOR [AND BORROWER] SHALL PAY TO THE ADMINISTRATIVE
AGENT ON DEMAND ANY AND ALL COSTS AND EXPENSES (INCLUDING REASONABLE
ATTORNEYS' FEES) PAID OR INCURRED AND PAYABLE BY THE ADMINISTRATIVE
AGENT IN CONNECTION WITH SUCH LITIGATION AND THE COSTS AND EXPENSES
SHALL BE SECURED BY THE LIEN OF THIS DEED OF TRUST. THE GRANTOR ALSO
AGREES NOT TO COMMENCE ANY ACTION, SUIT, PROCEEDING AND/OR CASE OR
FILE ANY APPLICATION OR MAKE ANY MOTION IN RESPECT OF THE GROUND LEASE
IN THE EVENT OF THE GRANTOR'S BANKRUPTCY WITHOUT THE PRIOR WRITTEN
CONSENT OF THE ADMINISTRATIVE AGENT.
(L) THE GRANTOR HEREBY IRREVOCABLY APPOINTS THE ADMINISTRATIVE AGENT ITS
AGENT AND ATTORNEY-IN-FACT (WHICH APPOINTMENT IS COUPLED WITH AN
INTEREST) TO OBSERVE AND PERFORM ON BEHALF OF THE GRANTOR THE
COVENANTS AND AGREEMENTS CONTAINED IN THIS SECTION AND ANY ADVANCES
MADE BY THE ADMINISTRATIVE AGENT IN CONNECTION WITH SUCH PERFORMANCE
OR OBSERVANCE SHALL BE REPAID BY THE GRANTOR [AND BORROWER] WITHIN TEN
(10) DAYS OF DEMAND WITH INTEREST AT THE DEFAULT RATE AND THE AMOUNT
SO
-30-
ADVANCED, AND INTEREST THEREON, SHALL BE A LIEN UPON THE MORTGAGED
PREMISES AND SHALL BE SECURED BY THIS DEED OF TRUST. SUCH PERFORMANCE
OR OBSERVANCE BY THE ADMINISTRATIVE AGENT SHALL NOT PREVENT THE
GRANTOR'S FAILURE TO PERFORM OR OBSERVE FROM CONSTITUTING A DEFAULT
UNDER THIS DEED OF TRUST.
(M) IF THE GRANTOR SHALL DEFAULT UNDER ANY OF ITS OBLIGATIONS WITH RESPECT
TO THE GROUND LEASE, AND SUCH DEFAULT IS NOT CURED WITHIN ANY
APPLICABLE GRACE PERIOD PROVIDED FOR IN THE GROUND LEASE, OR IF THE
ESTATE CREATED BY THE GROUND LEASE SHALL BE SURRENDERED, OR IF THE
GROUND LEASE SHALL BE ASSIGNED, CANCELED, TERMINATED, SUPPLEMENTED,
EXTENDED, MODIFIED AND/OR AMENDED WITHOUT THE PRIOR WRITTEN CONSENT OF
THE ADMINISTRATIVE AGENT, THEN SUCH SHALL AUTOMATICALLY AND WITHOUT
ANY NOTICE TO THE GRANTOR BY THE ADMINISTRATIVE AGENT, BE A DEFAULT
UNDER THIS DEED OF TRUST.]
EXECUTED this the ________ day of __________, 1996.
Grantor's Address: GRANTOR:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ __________________________
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: _____________
By: ___________________________
Name:__________________________
Title:_________________________
Administrative Agent's Address:
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
P.O. Box 655415
Commerical Real ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
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[ADD APPROPRIATE FORM OF ACKNOWLEDGMENT]
-32-
EXHIBITS
Exhibit "A" - Legal Description
Exhibit "B" - Permitted Exceptions
-33-
THIS INSTRUMENT WAS PREPARED BY
AND THE RECORDED ORIGINAL SHOULD
BE RETURNED TO THE FOLLOWING:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
BRACEWELL & ▇▇▇▇▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
FORM OF
MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS
AND FINANCING STATEMENT
________________________________________________________________________________
THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY AND FUTURE ADVANCE PROVISIONS.
THIS INSTRUMENT COVERS THE INTEREST OF DEBTOR IN MINERALS OR THE LIKE (INCLUDING
OIL AND GAS) BEFORE EXTRACTION AND THE SECURITY INTEREST CREATED BY THIS
INSTRUMENT ATTACHES TO SUCH MINERALS AS EXTRACTED AND TO THE ACCOUNTS RESULTING
FROM THE SALE THEREOF AT THE WELLHEAD.
THIS INSTRUMENT COVERS THE INTEREST OF DEBTOR IN FIXTURES.
THIS FINANCING STATEMENT IS TO BE FILED FOR RECORD, AMONG OTHER PLACES, IN THE
REAL ESTATE RECORDS.
PRODUCTS OF THE COLLATERAL ARE ALSO COVERED.
________________________________________________________________________________
THE STATE OF __________ (S)
(S) KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF _____________ (S)
THIS MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND FINANCING
STATEMENT (as amended from time to time, the "Mortgage") is made this _____ day
of _________, 1996 by _______________________________ ("Mortgagor"), a
______________________________________, having an office and mailing address at
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention _________
in favor of BANK ONE, TEXAS, N.A., a national banking association, as
administrative agent ("Mortgagee") for the Banks (as hereinafter defined),
having an office and mailing address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 4th Floor, P.O. Box
655415, Commercial Real ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President.
W I T N E S S E T H
WHEREAS, [AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., A
DELAWARE LIMITED PARTNERSHIP (THE "BORROWER"), WHICH IS THE DIRECT OR INDIRECT
OWNER OF THE MORTGAGOR] [MORTGAGOR], Bank One, Texas, N.A., as Administrative
Agent, and Societe Generale, Southwest Agency, as Structuring Agent, and the
banks and other lenders party thereto (collectively the "Banks") have entered
into a Credit Agreement dated as of ____________, 1996 (as amended or otherwise
modified from time to time, the "Credit Agreement"); and
WHEREAS, [BORROWER/MORTGAGOR] has executed promissory notes of even date
with the Credit Agreement in favor of the Banks in the original aggregate
principal amount of $100,000,000.00, the final payments of which are due on or
before June 30, 2000 (the "Notes", which term includes any modification,
renewal, extension or alteration thereof); and
WHEREAS, the Notes were executed and delivered to Mortgagee and the Banks,
and shall be due and payable in accordance with the Credit Agreement; and
WHEREAS, all capitalized terms not otherwise defined in this instrument
shall have the meaning assigned to such terms by the Credit Agreement; and
WHEREAS, Mortgagor is [LEASING/SUBLEASING] a portion of the Mortgaged
Premises (as hereinafter defined) to AGH Leasing, L.P. (the "Tenant") under that
certain lease executed between Mortgagor and Tenant (the "Hotel Lease"); and
-2-
WHEREAS, the terms and provisions of the Notes and Credit Agreement are
incorporated herein by reference and made a part of this Mortgage to the same
extent as though set forth in full herein; and
WHEREAS, as a condition to the acceptance of the Notes and the making of
the loan evidenced by the Credit Agreement (the "Loan"), Mortgagor agreed to
execute and deliver this Mortgage to secure the payment of the indebtedness from
time to time evidenced by the Notes, the payment of all sums now or hereafter
owing by [BORROWER AND] Mortgagor and the Guarantors (all such Persons being
collectively referred to herein as the "Obligors") hereunder, under the Credit
Agreement or under any other document or instrument now or hereafter evidencing
or securing the aforesaid indebtedness or otherwise executed in connection
herewith or therewith (this Mortgage, the Notes, the Credit Agreement and all
other documents and instruments now or hereafter evidencing or securing the
aforesaid indebtedness or otherwise executed in connection herewith or
therewith, being hereinafter referred to collectively as the "Loan Documents"),
and the performance and observance of all covenants, agreements, conditions and
other provisions set forth herein, in the Notes and in the other Loan Documents;
NOW THEREFORE, to secure the payment of the indebtedness from time to time
evidenced by the Notes, the payment of all other sums now or hereafter owing by
the Obligors hereunder, under the Credit Agreement or any other Loan Document
and the performance and observance of all covenants, agreements, conditions and
other provisions set forth herein, in the Notes, the Credit Agreement or
any other Loan Document, and to charge the properties, interests and rights
hereinafter described with such payment, performance and observance, and for and
in consideration of the sum of Ten and No/100 Dollars ($10.00) paid by Mortgagee
to Mortgagor and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Mortgagor does hereby grant,
bargain, sell, alienate, devise, release, convey, assign, transfer, mortgage,
hypothecate, pledge, deliver, set over, warrant and confirm unto Mortgagee, its
successors and assigns forever, and, if applicable, grants a security interest
to Mortgagee, its successors and assigns, in the [FOLLOWING DESCRIBED LEASE
WHICH COVERS THE] land or property described on Exhibit "A" attached hereto and
------- ---
made a part hereof for all purposes (the "Land"):
[DESCRIBE GROUND LEASE, IF ANY (THE "GROUND LEASE")],
together with all buildings, fixtures and other improvements located on the Land
or hereafter placed on the Land; all rights, titles and interests now owned or
hereinafter acquired by Mortgagor in and to all easements, streets and rights of
way of every kind and nature adjoining the above the Land and all public or
private utility connections thereto and all leasehold interests, appurtenances,
servitudes, rights, privileges, prescriptions and advantages thereunto
belonging or in anywise appertaining; all materials, goods (including without
-3-
limitation consumables and inventories), equipment, appliances, apparatus,
furniture, furnishings, inventory, and other property, real or personal, now
owned or hereafter acquired by Mortgagor and now or hereafter installed, used or
located on the above described property or the improvements thereon, whether or
not the same have or would become a part of the Land by attachment thereto,
including, but not limited to, all heating, lighting, refrigeration, plumbing,
ventilating, laundry, incinerating, water-heating, cooking, dishwashing, radio,
communication, electrical and air conditioning equipment, appliances, fixtures
and appurtenances, together with all disposals, dishwashers, machinery,
elevators, pumps, generators, sprinklers, wiring, pipe, doors, motors,
compressors, boilers, condensing units, range hoods, windows, window screens,
window shades, venetian blinds, awnings, drapes, shelving, mantels, cabinets,
paneling, rugs and other floor coverings, and shrubbery and other chattels and
personal property as are ever used, usable or furnished in connection with any
present or future operation, use or enjoyment of the Land and the improvements
on the Land, and all renewals, replacements and substitutions thereof and
additions thereto and Mortgagor's current and future rights as lessee under
leases of any of the foregoing; all rights, titles and interests of Mortgagor in
and to all crops located on and timber to be cut from the Land and all minerals
in, under and upon, produced or to be produced from the Land; all rights to the
present or future use of wastewater, drainage water or other utility facilities
to the extent such use benefits the Land or the improvements now or hereafter
located thereon; and without limitation of the foregoing, any and all permits,
licenses, approvals, rights, rents, revenues, benefits, leases, concessions,
licenses, contracts, accounts (including without limitation all rights to
payment from any consumer credit/charge card organization or entity), general
intangibles, trade names, moneys, instruments, documents, tenements,
hereditaments and appurtenances now or hereafter owned by Mortgagor and
pertaining to, generated from, arising out of or belonging to the above
described properties or any part thereof (including without limitation the
Mortgagor's Concentration Bank Account); and Mortgagor's interest in all 1-800
and other telephone numbers (all of the aforesaid being hereinafter sometimes
called the "Mortgaged Premises"). The Mortgaged Premises shall also include the
Mortgagor's interest, if any, in all current and future management, franchise
and license agreements related to the Land or the improvements thereon and the
Hotel Lease. Some of the said items are or are to become "fixtures" (as that
term is defined in the Uniform Commercial Code, as adopted in the state in which
the Mortgaged Premises are located (the "Code")) on the above described land and
as provided under the Code, this Mortgage, upon being filed for record in the
real property records of the state and county where the Mortgaged Premises are
located, shall operate also as a "fixture filing" and financing statement upon
such of the items which as are or may become fixtures.
TO HAVE AND TO HOLD the Mortgaged Premises and all parts thereof unto the
Mortgagee, its successors and assigns, to its own proper use and benefit
forever, subject, however, to those matters set forth on Exhibit "B" hereto and
the terms and conditions herein and Mortgagor hereby binds itself, its
respective successors and assigns to forever warrant
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and defend the Mortgaged Premises and every part thereof unto Mortgagee and its
successors and assigns against the claims and demands of every person whomsoever
lawfully claiming or to claim the same or any part thereof except for those
matters set forth on Exhibit "B" hereto.
PROVIDED ALWAYS, that if the Obligors pay to the Mortgagee and the Banks
the Notes at the times, in the amounts and in the manner stipulated therein,
together with any and all sums payable pursuant to any other Loan Document, and
faithfully perform all the covenants and agreements in the Notes, the Credit
Agreement and every other Loan Document, to be kept, performed or observed by
the Obligors, then this Mortgage shall cease and be void, but shall otherwise
remain in full force and effect.
1. FUTURE ADVANCES AND ADDITIONAL INDEBTEDNESS. In addition, this
Mortgage is made (i) to secure the performance and discharge of each and every
promise, obligation, covenant and agreement contained in the Notes, this
Mortgage, the Credit Agreement and any other Loan Document and (ii) to secure
the following (all of the following, including the hereinabove described Notes
and the foregoing, herein sometimes called "Said Indebtedness"):
(a) The payment of all other amounts with interest thereon becoming due
and payable to the Mortgagee and the Banks under the terms of the
Notes, this Mortgage, or any other Loan Document, including (but not
limited to) any moneys advanced thereunder by Mortgagee and the Banks
on behalf of the Obligors;
(b) Any extension, modification, renewal or reamortization of the Notes,
and any increase or addition thereto; and
(c) The payment of all other indebtedness, of whatever kind or character,
now owing or which may hereafter become owing by the Obligors to
Mortgagee and the Banks, pursuant to the terms of the Credit Agreement
or any other Loan Document, whether such indebtedness is direct or
indirect, primary or secondary, fixed or contingent or arises out of
or is evidenced by note, deed of trust, open account, overdraft,
endorsement, surety agreement, guaranty or otherwise, it being
contemplated that the Obligors may hereafter become indebted to
Mortgagee and the Banks for further sum or sums.
2. ADDITIONAL SECURITY. As additional security for the payment of the
Said Indebtedness, Mortgagor hereby transfers, assigns and conveys unto the
Mortgagee, for its benefit and the ratable benefit of the Banks, the following
and all products and
-5-
proceeds of the same (hereinafter collectively referred to as the "Income"), but
the mention of products and proceeds herein shall not be construed as an
authorization for the transfer or surrender by Mortgagor of the Income:
(a) All judgments, awards of damages, insurance proceeds and settlements
hereafter made resulting from condemnation proceedings or the taking
of all or any part of the Mortgaged Premises under the power of
eminent domain, or for any damage (whether caused by a taking, a
casualty or otherwise) to the Mortgaged Premises or any part thereof,
or to any rights appurtenant thereto, including, but not limited to,
any award for change of grade of streets. The Mortgagee is hereby
authorized, but shall not be required, on behalf and in the name of
Mortgagor, to execute and deliver valid acquittances for, and to
appeal from, any such judgments or awards. Subject to the terms and
conditions of the Credit Agreement, the Mortgagee may apply all such
sums or any part thereof so received, after the payment of all
expenses, including costs and attorney's fees, as a payment on Said
Indebtedness in such manner as the Mortgagee elects.
(b) All bonuses, rents and royalties accrued or to accrue under all oil,
gas or mineral leases affecting the Mortgaged Premises, now existing
or which may hereafter come into existence. Mortgagor directs payment
of the same to the Mortgagee, for the benefit of the Banks, at the
option of the Mortgagee and upon written demand of the Mortgagee
therefor, to be applied to Said Indebtedness until paid, whether due
or not, and either before or after any Default under the terms of this
Mortgage.
(c) All rents, income and profits issuing or to hereafter issue from the
Mortgaged Premises, and in the event of a Default hereunder,
Mortgagee, for the benefit of the Banks, shall have the right, at its
option, and with or without taking possession of the Mortgaged
Premises, to collect said rents, income and profits, or if the
Mortgaged Premises are vacant to rent the same and collect the rents,
and apply the same to the payment of Said Indebtedness after deducting
all costs of collection and administration. The collection of said
rents, income and profits by the Mortgagee shall not constitute a
waiver of its right to accelerate the maturity of the Notes nor of its
right to proceed with the enforcement of this Mortgage. Mortgagor
shall not assign the whole or any part of the rents, income or profits
arising from the Mortgaged Premises without the prior written consent
of Mortgagee and any assignment thereof without such consent will be
null and void; and upon notice and demand, Mortgagor shall transfer
and assign to Mortgagee, in form satisfactory to Mortgagee, the
lessor's interest in any lease now or hereafter affecting the
-6-
whole or any part of the Mortgaged Premises. Mortgagor agrees that it
shall duly and timely perform all of its obligations as provided for
in any leases or other rental contracts covering or relating to any of
the Mortgaged Premises.
The liens, security interests, and rights granted by this Mortgage shall not
affect or be affected by any other security taken for the Said Indebtedness or
any part thereof. The taking of additional security, or the extension or renewal
of Said Indebtedness or any part thereof, shall at no time release or impair the
liens, security interests and rights granted hereby, or affect the liability of
any endorser, guarantor, or surety, or improve the right of any junior
lienholder; and this Mortgage, as well as any instrument given to secure any
renewal or extension of Said Indebtedness, or any part thereof, shall be and
remain the first and prior lien and security interest on all of the Mortgaged
Premises not expressly released, until the Said Indebtedness is completely paid.
3. SUBROGATION TO EXISTING LIENS. It is agreed that the lien hereby
created shall take precedence over and be a prior lien to any other lien of any
character whether vendor's, materialman's or mechanic's lien hereafter created
on the Mortgaged Premises, and in the event the proceeds of the Notes are used
to acquire or to pay off and satisfy any indebtedness and liens heretofore
existing on the Mortgaged Premises, then the Mortgagee is, and shall be for the
benefit of the Banks, subrogated to all of the rights, liens and remedies of the
holders of the indebtedness and liens so acquired or paid off, regardless of
whether said indebtedness and liens are acquired by the Mortgagee by assignment
or are released by the holders thereof upon payment.
4. COVENANTS, REPRESENTATIONS AND AGREEMENTS OF MORTGAGOR. Mortgagor
covenants, represents and agrees:
(a) That Mortgagor will timely perform all of its obligations under the
Notes, the Credit Agreement and every other Loan Document in
accordance with their respective terms and conditions.
(b) That Mortgagor shall pay, prior to delinquency, all taxes and
assessments levied or assessed against the Mortgaged Premises,
including, without limitation, all taxes in lieu of ad valorem taxes,
as the same become due and payable; provided that, Mortgagor may
contest the amount of such taxes and assessments so long as Mortgagor
does so in good faith and by appropriate proceedings, and furnishes
Mortgagee with a bond or other security in form, substance and amount
satisfactory to Mortgagee. In the event of the passage after date of
this Mortgage of any law or regulation deducting from the Mortgaged
Premises for the purposes of taxation any lien thereon, or changing in
any way the laws now in force for the taxation of mortgages,
-7-
deeds of trust, or indebtedness secured thereby, for state or local
purposes, or the manner of the operation of any such taxes so as to
affect the interest of Mortgagee or the Banks, then and in such event,
Mortgagor shall bear and pay the full amount of such taxes. If
Mortgagor fails to pay any such taxes and assessments including,
without limitation, taxes in lieu of ad valorem taxes and taxes
against this Mortgage or Said Indebtedness secured hereby, Mortgagee
may pay the same, together with all costs and penalties thereon, at
Mortgagor's expense; provided, however, that if for any reason payment
by Mortgagor of any such new or additional taxes would be unlawful or
if the payment thereof would constitute usury or render Said
Indebtedness wholly or partially usurious under any of the terms or
provisions of the Notes or this Mortgage, or otherwise, Mortgagee may,
at its option and for the benefit of the Banks, declare Said
Indebtedness with all accrued interest thereon to be immediately due
and payable, or Mortgagee may, at its option, pay the amount or
portion of such taxes as renders Said Indebtedness unlawful or
usurious, in which event Mortgagor shall concurrently therewith pay
the remaining lawful and nonusurious portion or balance of said taxes.
(c) That Mortgagor shall keep every part of the Mortgaged Premises in good
condition and presenting an appearance customary for like-situated
properties and in compliance with all requirements of any franchisor
with respect to the business operated on the Mortgaged Premises, make
promptly all repairs, renewals and replacements necessary to such end,
prevent waste to any part of the Mortgaged Premises, and do promptly
all else necessary to such end; and Mortgagor shall discharge all
claims for labor performed and material furnished therefor, and shall
not suffer any lien of mechanics or materialmen therefor to attach to
any part of the Mortgaged Premises. Mortgagor shall guard every part
of the Mortgaged Premises from removal, destruction and damage, and
shall not do or suffer to be done any act whereby the value of any
part of the Mortgaged Premises may be lessened. No building or other
property now or hereafter covered by the lien of this Mortgage shall
be removed, demolished or materially altered or enlarged, nor shall
any new building be constructed, without the prior written consent of
Mortgagee, which consent shall not be unreasonably withheld or
delayed. Mortgagee and the Banks and their respective agents or
representatives shall have access to the Mortgaged Premises at all
reasonable times in order to inspect same and verify Mortgagor's
compliance with its duties and obligations under this document.
(d) That in the event Mortgagor shall fail to keep the improvements on the
Mortgaged Premises in the condition required hereby,or to pay promptly
-8-
when due all taxes and assessments, as aforesaid, or to preserve the
prior lien of this Mortgage on the Mortgaged Premises, or to keep the
buildings and improvements insured, as provided in the Credit
Agreement, or to deliver the policy, or policies, of insurance or the
renewal therof to the Mortgagee, as provided in the Credit Agreement,
then the Mortgagee may, at its option but without being required to do
so, make such repairs, pay such taxes and assessments, purchase any
tax title thereon, remove any prior liens, and prosecute or defend any
suits in relation to the preservation of the prior lien of this
Mortgage on the Mortgaged Premises, or insure and keep the
improvements thereon insured in an amount not to exceed that
stipulated in the Credit Agreement; that any sums which may be so paid
out by the Mortgagee and all sums paid for insurance premiums, as
aforesaid, including, but not limited to, the costs, expenses and
attorney's fees paid in any proceeding, transaction or suit affecting
the Mortgaged Premises when necessary to protect the lien hereof shall
bear interest from the dates of such payments at the Default Rate (as
defined in the Credit Agreement), and shall be paid by Obligors and
Mortgagor to the Mortgagee and the Banks in accordance with the Credit
Agreement, at the same place at which the Notes are payable, and shall
be deemed a part of the debt hereby secured and recoverable as such in
all respects.
(e) That Mortgagor shall comply with all restrictive covenants and all
laws, ordinances, regulations and rules, whether state, federal or
municipal, applicable to the Mortgaged Premises and its ownership, use
and occupancy, and that Mortgagor has obtained all approvals, licenses
and permits necessary for the ownership, use and occupancy of the
Mortgaged Premises.
(f) That in the six (6) months prior to the recordation of this Mortgage
in the real property records of the county or counties in which the
Mortgaged Premises or any part thereof is situated, (i) no
construction of any proposed above or below ground improvements,
structures, additions or alterations has commenced, (ii) no materials
or supplies have been delivered to or labor performed on the
Mortgaged Premises, and (iii) Mortgagor has not entered into any
contracts or agreements for the construction of any improvements,
structures, additions or alterations, or the delivery of any materials
or supplies or the performance of said labor.
5. DEFAULT. The term "Default," as used herein, shall mean the occurrence
of any one of the following events:
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(a) The occurrence of an "Event of Default" as defined in the Credit
Agreement; or
(b) Mortgagor abandons all or a portion of the Mortgaged Premises; or
(c) The holder of any lien or security interest on the Mortgaged Premises
institutes foreclosure or other proceedings for the enforcement of its
remedies thereunder; or
(d) Except as expressly provided otherwise in the Credit Agreement, if
Mortgagor or any partner thereof dissolves, liquidates, terminates, or
conveys, transfers, assigns or pledges any interest in the Mortgaged
Premises or Mortgagor or any other Transfer shall occur which has not
been approved in writing by Mortgagee.
Mortgagor's failure to perform or observe any covenant contained in this
Mortgage, other than those contained in Section 16 below and except as provided
to the contrary herein, shall not constitute a Default: (1) until such failure
shall remain unremedied for thirty (30) days after the date written notice of
such default shall have been given to the Mortgagor by the Mortgagee or any of
the Banks or (2) if such performance is incapable of being completed within
thirty (30) days, unless Mortgagor fails to commence the performance of such
covenant, agreement or other obligation within said thirty (30) day period and
thereafter diligently pursue such performance until completion.
Upon the occurrence of a Default, Mortgagee, at its option, and without notice
of intent to accelerate, notice of acceleration, or any other notice, demand, or
presentment, which are hereby expressly waived by Mortgagor and the other
Obligors, may declare the entire unpaid balance of principal of, and all accrued
interest on, the Said Indebtedness immediately due and payable, in addition to
exercising any and all remedies provided for under this Mortgage, the
instruments evidencing Said Indebtedness and all other instruments securing Said
Indebtedness, or any part thereof. Upon the occurrence of a Default, the
Mortgagee may, either with or without entry or taking possession as hereinabove
provided or otherwise, proceed by suit or suits at law or in equity or by any
other appropriate proceeding or remedy: (a) to enforce payment of the Notes or
the performance of any term hereof, of any other Loan Document, or of any other
right; (b) to foreclose this Mortgage and to sell, as an entirety or in separate
lots or parcels, the Mortgage and to sell, as an entirety or in separate lots or
parcels, the Mortgaged Premises, under the judgment or decree of a court or
courts of competent jurisdiction, or in such manner or manners as allowed under
applicable law; and (c) to pursue any other remedy available to it. The
Mortgagee shall take action either by such proceedings or by the exercise of its
powers with respect to entry or taking possession, or both, as the Mortgagee may
determine. Upon the occurrence of a Default, Mortgagee shall also have the
right, for the benefit of the Banks, to exercise any and
-10-
all other rights, remedies and recourse now or hereafter existing in equity, at
law, by virtue of statute or otherwise.
6. MORTGAGEE'S RIGHT TO ENTER AND TAKE POSSESSION, OPERATE AND APPLY
INCOME.
(a) Upon the occurrence of a Default, the Mortgagor, upon demand of the
Mortgagee, shall forthwith surrender to the Mortgagee the actual
possession, and if and to the extent permitted by law, the Mortgagee
itself, or by the officers or agents as it may appoint, may enter and
take possession of all or any portion of the Mortgaged Premises, and
may exclude the Mortgagor and its agents and employees wholly
therefrom, and may have joint access with the Mortgagor to the books,
papers and accounts of the Mortgagor;
(b) If the Mortgagor shall for any reason fail to surrender or deliver the
Mortgaged Premises or any part thereof after the Mortgagee's demand,
the Mortgagee may obtain a judgment or decree conferring on the
Mortgagee the right to immediate possession or requiring the Mortgagor
to deliver immediate possession of all or part of the Mortgaged
Premises to the Mortgagee, to the entry of which judgment or decree
the Mortgagor hereby specifically consents;
(c) The Mortgagor shall pay to the Mortgagee, upon demand, all costs and
expenses of obtaining such judgment or decree and reasonable
compensation to the Mortgagee, its attorneys and agents, and all such
costs, expenses and compensation shall, until paid, be secured by the
lien of this Mortgage; and
(d) Upon every entering upon or taking of possession, the Mortgagee may
hold, store, use, operate, manage and control the Mortgaged Premises
and conduct the business thereof, and, from time to time:
(i) make all necessary and proper maintenance, repairs, renewals,
replacements, additions, betterments and improvements thereto
and thereon and purchase or otherwise acquire additional
fixtures, personalty and other property;
(ii) insure or keep the Mortgaged Premises insured;
(iii) manage and operate the Mortgaged Premises and exercise all the
rights and powers of the Mortgagor in its name or otherwise,
with respect to the same; and
-11-
(iv) enter into agreements with others to exercise the powers
herein granted the Mortgagee;
all as the Mortgagee from time to time may determine; and the Mortgagee,
for the benefit of the Banks, may collect and receive all the income,
revenues, rents, issues and profits of the same, including those past due
as well as those accruing thereafter; and shall apply the monies so
received by the Mortgagee in the priority as the Mortgagee may determine to
(1) the payment of accrued interest on the Notes; (2) any deposits for
taxes and assessments and insurance premiums due; (3) the payment of
overdue installments of principal (whether by acceleration or otherwise);
(4) the cost of insurance, taxes, assessments and other proper charges upon
the Mortgaged Premises or any part thereof; (5) the reasonable
compensation, expenses and disbursements of the agents, attorneys and other
representatives of the Mortgagee; and (6) any and all other charges or fees
payable by any of the Obligors to Mortgagee and the Banks pursuant to the
Credit Agreement or any other Loan Document. Mortgagor hereby assents to,
ratifies and confirms any and all actions of Mortgagee with respect to the
Mortgaged Premises, taken under this Paragraph 6.
The Mortgagee shall surrender possession of the Mortgaged Premises to the
Mortgagor only when (i) all that is due upon such interest, tax and insurance
deposits (if any) and principal installments, and under any of the terms of this
Mortgage or any other Loan Document, shall have been paid and all defaults made
good or (ii) should Said Indebtedness have been accelerated, payment in full
thereof shall have been made together with all other amounts due thereunder or
under any other Loan Document. The same right of taking possession, however,
shall exist if any subsequent Default shall occur and be continuing.
7. LEASES. The Mortgagee, at its option, is authorized to foreclose this
Mortgage subject to the rights of any tenants of the Mortgaged Premises, and the
failure to make any such tenants parties to any such foreclosure proceedings and
to foreclose their rights will not be, nor be asserted by the Mortgagor to be,
a defense to any proceedings instituted by the Mortgagee to collect the sums
secured hereby or to collect any deficiency remaining unpaid after the
foreclosure sale of the Mortgaged Premises.
8. PURCHASE BY MORTGAGEE. Upon any foreclosure sale, the Mortgagee may
bid for and purchase the Mortgaged Premises and, upon compliance with terms of
sale, may hold, retain and possess and dispose of such property in its own
absolute right without further accountability.
9. APPLICATION OF INDEBTEDNESS TOWARD PURCHASE PRICE. Upon any
foreclosure sale, the Mortgagee may, if permitted by law, after allowing for the
portion of the total purchase price required to be paid in cash and for the
costs and expenses
-12-
of the sale, compensation and other charges, in paying the purchase price, apply
any portion of or all sums due to Mortgagee and the Banks under the Notes, this
Mortgage or any other Loan Document, in lieu of cash, to the amount which shall,
upon distribution of the net proceeds of the sale, be payable thereon.
10. FORECLOSURE WITHOUT MATURING ENTIRE NOTES. Upon the occurrence of a
Default, the Mortgagee shall have the option to proceed with foreclosure of the
liens and security interests evidenced hereby in satisfaction of such item
either through the courts or by proceeding, all without declaring the entire
Said Indebtedness due, and provided that if sale of the Mortgaged Premises is
made because of default in the payment of a part of the Said Indebtedness, such
sale may be made subject to the unmatured part of the Said Indebtedness; and
such sale, if so made, shall not in any manner affect the unmatured part of the
Said Indebtedness, but as to such unmatured part this Mortgage shall remain in
full force and effect just as though no sale had been made. The proceeds of any
sale shall be applied as provided in Paragraph 9 above. Several sales may be
made hereunder without exhausting the right of sale for any unmatured part of
the Said Indebtedness. It is the purpose hereof to provide for a foreclosure and
sale of the Mortgaged Premises for any matured portion of the Said Indebtedness
without exhausting the power to foreclose and to sell the Mortgaged Premises for
any other part of the Said Indebtedness whether matured at the time or
subsequently maturing.
11. OCCUPANCY AFTER FORECLOSURE. In the event there is a foreclosure sale
hereunder and at the time of such sale Mortgagor or Mortgagor's representatives,
successors or assigns or any other persons claiming any interest in the
Mortgaged Premises by, through or under Mortgagor are occupying or using the
Mortgaged Premises or any part thereof, each and all shall, at the option of the
Mortgagee or the purchaser at such sale, as the case may be, immediately become
the tenant of the purchaser at such sale, which tenancy shall be a tenancy from
day-to-day, terminable at the will of either landlord or tenant, at a reasonable
rental per day based upon the value of the Mortgaged Premises occupied, such
rental to be due daily to purchaser. In the event the tenant fails to surrender
possession of said property upon the exercise of such option, the purchaser
shall be entitled to institute and maintain an eviction proceeding before the
appropriate court of the County and State in which the Mortgaged Premises, or
any part thereof, are located.
12. APPOINTMENT OF A RECEIVER. In addition to all other remedies herein
provided for, Mortgagor agrees that upon the occurrence of a Default, or any
event or circumstance which, with the lapse of time or the giving of notice, or
both, would constitute a Default hereunder, the Mortgagee shall as a matter of
right be entitled to the appointment of a receiver or receivers for all or any
part of the Mortgaged Premises, whether such receivership be incident to a
proposed sale of such property or otherwise, and without regard to the value of
the Mortgaged Premises or the solvency of any person or persons liable for
-13-
the payment of the indebtedness secured hereby, and Mortgagor does hereby
consent to the appointment of such receiver or receivers, waive any and all
defenses to such appointment and agrees not to oppose any application therefor
by the Mortgagee, but nothing herein is to be construed to deprive the Mortgagee
or any of the Banks of any other right, remedy or privilege they may now have
under the law to have a receiver appointed; provided, however, that the
appointment of such receiver, trustee or other appointee by virtue of any court
order, statute or regulation shall not impair or in any manner prejudice the
rights of the Mortgagee and the Banks to receive payment of the rents and income
pursuant to this Mortgage. Any money advanced by the Mortgagee in connection
with any such receivership shall be a demand obligation owing by Mortgagor to
the Mortgagee and shall bear interest from the date of making such advancement
by the Mortgagee until paid at the Default Rate and shall be a part of the Said
Indebtedness and shall be secured by this Mortgage and by any other instrument
securing the secured indebtedness.
13. NON-WAIVER. It is expressly agreed that (i) no waiver of any Default
on the part of Mortgagor or any of the Obligors or breach of any of the
provisions of this Mortgage shall be considered a waiver of any other or
subsequent Default or breach, and no delay or omission in exercising or
enforcing the rights and powers herein granted shall be construed as a waiver of
such rights and powers, and likewise no exercise or enforcement of any rights or
powers hereunder shall be held to exhaust such rights and powers, and every such
right and power may be exercised from time to time; (ii) any failure by
Mortgagee to insist upon the strict performance by Mortgagor of any of the terms
and provisions hereof shall not be deemed to be a waiver of any of the terms and
provisions hereof, and Mortgagee, notwithstanding any such failure, shall have
the right thereafter to insist upon the strict performance by Mortgagor of any
and all of the terms and provisions of this Mortgage; (iii) neither Mortgagor
nor any of the Obligors nor any other person now or hereafter obligated for the
payment of the whole or any part of Said Indebtedness shall be relieved of such
obligation by reason of the failure of Mortgagee to comply with any request of
Mortgagor or any of the Obligors or of any other person so obligated, to take
action to foreclose this Mortgage or otherwise enforce any of the provisions of
this Mortgage or of any obligations secured by this Mortgage, or by reason of
the release, regardless of consideration, of the whole or any part of the
security held for Said Indebtedness, or by reason of the subordination in whole
or in part by Mortgagee of the lien, security interest or rights evidenced
hereby, or by reason of any agreement or stipulation with any subsequent owner
or owners of the Mortgaged Premises extending the time of payment or modifying
the terms of Said Indebtedness or this Mortgage without first having obtained
the consent of Mortgagor or the Obligors or such other person, and in the latter
event, Mortgagor, the Obligors and all such other persons shall continue to be
liable to make such payments according to the terms of any such agreement of
extension or modification unless expressly released and discharged in writing by
Mortgagee; (iv) regardless of consideration and without the necessity for any
notice to or consent by the holder of any subordinate lien or
-14-
security interest on the Mortgaged Premises, Mortgagee may release the
obligation of anyone at any time liable for any of Said Indebtedness or any part
of the security held for Said Indebtedness and may extend the time of payment or
otherwise modify the terms of Said Indebtedness and/or this Mortgage without, as
to the security or the remainder thereof, in anywise impairing or affecting the
lien or security interest of this Mortgage or the priority of such lien or
security interest, as security for the payment of Said Indebtedness as it may be
so extended or modified, over any subordinate lien or security interest; (v) the
holder of any subordinate lien or security interest shall have no right to
terminate any lease affecting the Mortgaged Premises whether or not such lease
be subordinate to this Mortgage; and (vi) Mortgagee may resort for the payment
of Said Indebtedness to any security therefor held by Mortgagee in such order
and manner as Mortgagee may elect.
14. APPRAISEMENT AND REDEMPTION LAWS. To the full extent Mortgagor may do
so, Mortgagor agrees that Mortgagor will not at any time insist upon, plead,
claim or take the benefit or advantage of any law now or hereafter in force
providing for any appraisement, valuation, stay, extension or redemption, and
Mortgagor, for Mortgagor and Mortgagor's representatives, successors and
assigns, and for any and all persons ever claiming any interest in the Mortgaged
Premises, to the extent permitted by law, hereby waives and releases all rights
of redemption, valuation, appraisement, stay of execution, notice of intention
to mature or declare due the whole or any part of the Said Indebtedness, notice
of election to mature or declare due the whole or any part of the Said
Indebtedness and all rights to a marshalling of the assets of Mortgagor,
including the Mortgaged Premises, or to a sale in inverse order of alienation in
the event of foreclosure of the liens and security interests hereby created.
Mortgagor shall not have or assert any right under any statute or rule of law
pertaining to the marshalling of assets, sale in inverse order of alienation,
the exemption of homestead, the administration of estates of decedents or other
matters whatever to defeat, reduce or affect the right of the Mortgagee and the
Banks under the terms of this Mortgage to a sale of the Mortgaged Premises for
the collection of the Said Indebtedness without any prior or different resort
for collection, or the right of the Mortgagee and the Banks under the terms of
this Mortgage to the payment of such indebtedness out of the proceeds of sale of
the Mortgaged Premises in preference to every other claimant whatever. If any
law referred to in this paragraph and now in force, of which Mortgagor or
Mortgagor's representatives, successors and assigns and such other persons
claiming any interest in the Mortgaged Premises might take advantage despite
this paragraph, shall hereafter be repealed or cease to be in force, such law
shall not thereafter be deemed to preclude the application of this paragraph.
15. RENEWAL AND EXTENSION. The Mortgagee, without notice, may release any
part of the Mortgaged Premises, or any person liable on the Said Indebtedness,
without in any way affecting the lien hereof upon any portion of the Mortgaged
Premises not expressly released, and may agree with any party obligated on Said
Indebtedness, or having
-15-
any interest in the Mortgaged Premises, to renew and extend the time or manner
of payment of all or any part of Said Indebtedness. Such agreement shall not
in any way release or impair the lien hereof, but shall renew and extend the
lien hereof against the Mortgaged Premises without altering or affecting the
priority of the lien created by this Mortgage in favor of any junior
encumbrancer, mortgagee or purchaser, or any person acquiring an interest in the
Mortgaged Premises, and this Mortgage shall remain first and superior to any
liens that may be placed thereon, or that may be fixed, given or imposed by law
thereon after the execution of this instrument notwithstanding any such
extension of the time of payment, or the release of a portion of said property
from this lien.
16. SALE AND ADDITIONAL ENCUMBRANCES. Mortgagor hereby expressly agrees
that in the event the following occurs (hereinafter referred to as a "Transfer")
without the prior written consent of Mortgagee, except as expressly provided
otherwise in the Credit Agreement, whether by a direct or indirect method, then,
in any such event, the Mortgagee shall have the right, for the benefit of the
Banks, at its option, to declare the entire amount of Said Indebtedness to be
immediately due and payable, and the liens and security interests evidenced
hereby shall be subject to foreclosure in any manner provided for herein or
provided for by law or in equity as the Mortgagee may elect:
(a) Mortgagor shall cease to own the entire actual and beneficial title
and interest to all of the Mortgaged Premises, free and clear from all
liens, security interests and encumbrances except (i) the lien and
security interest evidenced by this Mortgage and (ii) such other
matters as are expressly permitted hereunder or in the Credit
Agreement;
(b) If anyone who has acquired title to the Mortgaged Premises (a
"Transferee") as a result of a transfer that has been approved by
Mortgagee (a "Permitted Transfer") shall cease to own the entire
actual and beneficial title and interest to all of the Mortgaged
Premises, free and clear from all liens, security interests and
encumbrances except (i) the lien and security interest evidenced by
this Mortgage, and (ii) such other matters as are expressly permitted
hereunder or in the Credit Agreement;
(c) Except as provided otherwise in the Credit Agreement, if any one of
the following shall occur with respect to Mortgagor or any Transferee
during the period of time preceding the date on which Mortgagor or any
such Transferee, as the case may be, transfers title to the Mortgaged
Premises as a result of a Permitted Transfer:
(i) If Mortgagor or any Transferee is a general partnership, limited
partnership or joint venture and Mortgagor or the Transferee
-16-
dissolves, terminates, liquidates or ceases to be general
partnership, limited partnership or joint venture, as the case
may be, duly organized and validly existing under the laws of
the state of its creation pursuant to a partnership or joint
venture agreement that has been approved in writing by
Mortgagee, or if the general partners or joint ventures of said
partnership or joint venture change from individuals or
entities that have been approved in writing by Mortgagee;
(ii) If Mortgagor or any Transferee is a corporation and said
corporation shall dissolve, merge, liquidate or cease to be a
corporation duly organized and validly existing under the laws
of the state of its incorporation;
(iii) If Mortgagor or any Transferee is a general partnership,
limited partnership or joint venture and there shall be a
transfer of any of the general partnership interest or joint
venture interest in Mortgagor or said Transferee;
(iv) If Mortgagor or any Transferee is a corporation and there is a
transfer of any of the stock of said corporation or the
issuance of new stock of said corporation; or
(d) Except as provided otherwise in the Credit Agreement, if Mortgagor or
any Transferee shall enter into any contractual arrangement to sell,
transfer, convey or mortgage all or any part of the actual or
beneficial title and interest to the Mortgaged Premises that is not
expressly conditioned upon the consent of Mortgagee to the transaction
contemplated thereby.
Mortgagee, for the benefit of the Banks, shall have such right and option to
declare the entire amount of Said Indebtedness to be immediately due and
payable, irrespective of whether or not any such Transfer would or might (i)
diminish the value of any security for the Said Indebtedness, (ii) increase the
risk of default under this instrument, (iii) increase the likelihood of
Mortgagee's having to resort to any security for the Said Indebtedness after
default, or (iv) add or remove the liability of any person or entity for payment
or performance of Said Indebtedness or any covenant or obligation under this
Mortgage. Except where Mortgagee's consent is not required pursuant to the
Credit Agreement, if Mortgagee's consent to a proposed Transfer is requested,
Mortgagee shall have the right (in addition to its absolute right to refuse to
consent to any such Transfer) to condition its consent upon satisfaction of any
one or more of the following requirements:
-17-
(a) That the interest rate on the Notes be increased to a rate acceptable
to Mortgagee and the Banks, but not in excess of the Default Rate; or
(b) That a reasonable transfer fee, in an amount determined by Mortgagee
be paid; or
(c) That a principal amount deemed appropriate by Mortgagee be paid
against said Notes; or
(d) That Mortgagor and each proposed transferee execute such Assumption
Agreement and other instruments as Mortgagee shall require.
17. MORTGAGOR NOT RELEASED. In the event the Mortgagee approves a future
conveyance of the Mortgaged Premises, or any part thereof, and title becomes
vested in persons other than Mortgagor, the Mortgagee may, without notice to
Mortgagor, deal with such successor or successors in interest with reference to
this Mortgage and to the Notes in the same manner as with Mortgagor without in
any way vitiating or discharging Mortgagor's and the Obligors' liability
hereunder or upon Said Indebtedness. No sale of the Mortgaged Premises and no
forbearance on the part of the Mortgagee and no extension of the time for the
payment of the Notes, given by the Mortgagee, shall operate to release, modify,
change or affect the original liability of Mortgagor and the Obligors either in
whole or in part.
18. ACCEPTANCE ON ACCOUNT. Acceptance by the Mortgagee or any of the Banks
of any payment in an amount less than the amount then due on Said Indebtedness
shall be deemed an acceptance on account only, and the failure to pay the entire
amount then due shall be and continue to be a Default; at any time thereafter,
and until the entire amount then due on the Said Indebtedness has been paid, the
Mortgagee shall be entitled to exercise all rights conferred upon it in this
Mortgage.
19. SECURITY INTEREST. To further secure Said Indebtedness, Mortgagor
hereby grants a security interest to Mortgagee, for its benefit and the ratable
benefit of the Banks, in and to the Income and all personal property and
fixtures hereinabove described and all of Mortgagor's bank accounts, including
without limitation the Mortgagor's Concentration Bank Account, (all of such
Income, personal property, fixtures and the proceeds thereof and the bank
accounts being herein called the "collateral," but the mention of proceeds of
collateral herein shall not be construed as an authorization for the sale or
surrender by Mortgagor of collateral and collateral as used in this Mortgage
shall be included in the term "Mortgaged Premises " when used herein). This
document shall constitute a security agreement as well as a mortgage. The
following applies with respect to collateral:
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(a) In addition to and cumulative of any other remedies granted in this
Mortgage to Mortgagee, Mortgagee may, upon Default hereunder, proceed
under the Code as now adopted and existing and as it may hereafter be
amended or succeeded, as to all or any part of the collateral and
shall have and may exercise with respect to all or any part of the
collateral all of the rights, remedies and powers of a secured party
under the Code, including, without limitation, the right and power to
repossess, retain and sell, at public or private sale or sales, or
otherwise dispose of, lease or utilize the collateral or any part
thereof and to dispose of the proceeds in any manner authorized or
permitted under the applicable provisions of the Code, and to apply
the proceeds thereof toward payment of Mortgagee's reasonable
attorneys' fees and other expenses and costs of pursuing, searching
for, receiving, taking, keeping, storing, advertising, and selling the
collateral thereby incurred by Mortgagee, and toward payment of Said
Indebtedness in such order and manner as Mortgagee may elect
consistent with the provisions of the Code. Nothing in this Paragraph
19 shall be construed to impair or limit any other right or power to
which Mortgagee may be entitled at law or in equity.
(b) Among the rights of Mortgagee upon Default, and without limitation.
Mortgagee shall have the right (but not the obligation), without being
deemed guilty of trespass and without liability for damages thereby
occasioned, (i) to enter upon any premises where said collateral may
be situated and take possession of the collateral, or render it
unusable, or dispose of the collateral on Mortgagor's premises, and
Mortgagor agrees not to resist or to interfere and (ii) to take any
action deemed necessary or appropriate or desirable by Mortgagee and
at Mortgagee's option, and in its discretion, to repair, refurbish or
otherwise prepare the collateral for sale, lease or other use or
disposition as herein authorized. Mortgagee may at Mortgagee's
discretion require Mortgagor to assemble the collateral and make it
available to Mortgagee at a place designated by Mortgagee that is
reasonably convenient to both parties.
(c) Mortgagee shall give Mortgagor notice, by certified mail, postage
prepaid, of the time and place of any public sale of any of the
collateral or of the time after which any private sale or other
intended disposition thereof is to be made by sending notice to
Mortgagor at the address of Mortgagor set out below opposite its
signature at least five (5) days before the time of the sale or other
disposition, which provisions for notice Mortgagor and Mortgagee agree
are reasonable; provided, however, that nothing herein shall preclude
Mortgagee from proceeding as to both real and personal property in
-19-
accordance with Mortgagee's rights and remedies in respect to real
property as provided in the Code.
(d) To the extent such may now or hereafter be permitted under laws of the
state in which the Mortgaged Premises are located, Mortgagee is
authorized to execute and file financing statements and continuation
statements under the Code with respect to the collateral without
joinder of Mortgagor in such execution or filing. Mortgagor shall
execute and deliver to Mortgagee such financing statements,
continuation statements and other documents relating to the collateral
as Mortgagee may reasonably request from time to time to preserve and
maintain the priority of the security interest created by this
Mortgage and shall pay to Mortgagee on demand any expenses and
attorneys' fees incurred by Mortgagee in connection with the
preparation, execution and filing of this Mortgage and of any
financing statements, continuation statements, partial releases,
termination statements or other documents necessary or desirable to
continue or confirm Mortgagee's security interest or any modification
thereof. This document, and any carbon, photographic or other
reproduction of this document may be filed by Mortgagee and shall be
sufficient as a financing statement. All or part of the collateral is
or is to become fixtures, crops, timber or minerals on the real estate
constituting a portion of the Mortgaged Premises, but this statement
shall not impair or limit the effectiveness of this document as a
security agreement or financing statement, for other purposes, and
this Mortgage shall constitute a fixture, crops, timber and mineral
financing statement and, as such, shall be filed for record in the
real estate records of the county in which the land covered hereby is
located. Mortgagor shall not change its name without the prior express
written consent of Mortgagee which shall not be unreasonably withheld.
The name of the record owner of the land covered hereby the party
defined herein as Mortgagor.
(e) Unless otherwise disclosed to Mortgagee as herein provided, Mortgagor
agrees that, except for the security interest granted hereby in the
collateral, Mortgagor is the owner of the collateral free of any
adverse claim, security interest or encumbrance, and Mortgagor shall
defend the collateral against all claims and demands of any person at
any time claiming the same or any interest therein. Mortgagor has not
heretofore signed any financing statement and no financing statement
signed by Mortgagor now on file in any public office except those
statements, true and correct copies of which have been delivered to
Mortgagee. So long as any amount remains unpaid on Said Indebtedness,
Mortgagor shall not, except in connection with those Liens expressly
permitted by the Credit Agreement, execute and there shall not be
-20-
filed in any public office any such financing statement or statements
affecting the collateral other than financing statements in favor of
Mortgagee hereunder.
(f) The security interest granted herein shall not be construed or deemed
to constitute Mortgagee as a trustee or mortgagee in possession of the
Mortgaged Premises so as to obligate Mortgagee to lease the Mortgaged
Premises or attempt to do the same, or to take any action, incur any
expenses or perform or discharge any obligation, duty or liability
with respect to the Mortgaged Premises or any part thereof or
otherwise.
(g) Mortgagor's and Mortgagee's addresses are as herein below set forth.
Without limitation, the "collateral" also includes all right, title and interest
now owned or hereafter acquired by Mortgagor in and to the following described
property and all replacements or substitutions therefor and all products and
proceeds thereof:
(a) All contracts now or hereafter entered into by and between Mortgagor
and any contractor or supplier as well as all right, title and
interest of Mortgagor under any subcontracts, providing for the
construction (original, restorative or otherwise) of any improvements
to or on any of the Mortgaged Premises or the furnishing of any
materials, supplies, equipment or labor in connection with any such
construction;
(b) All of the plans, specifications and drawings (including, but not
limited to plot plans, foundations plans, floor plans, elevations,
framing plans, cross-sections of walls, mechanical plans, electrical
plans and architectural and engineering plans, and architectural and
engineering studies and analyses) heretofore or hereafter prepared by
any architect or engineer, in respect of any of the Mortgaged
Premises;
(c) All agreements now or hereafter entered into with any party in respect
of architectural, engineering, management or consulting services
rendered or to be rendered in respect of planning, design, inspection
or supervision of the construction or management of any of the
Mortgaged Premises;
(d) Any commitment issued by any lender or investor other than Mortgagee
to finance or invest in any of the Mortgaged Premises; and
(e) Any completion bond, performance bond or labor and material payment
bond and other bond relating to the Mortgaged Premises or to any
contract
-21-
providing for construction of improvements to any of the Mortgaged
Premises
To the extent that any of the collateral is not subject to the Uniform
Commercial Code of the state or states where it is situated, Mortgagor hereby
assigns to Mortgagee all of Mortgagor's right, title and interest in the
collateral to secure the Said Indebtedness. Release of the lien of this Mortgage
shall automatically terminate this assignment.
20. EXCESS INTEREST. The invalidity, or unenforceability in particular
circumstances, of any provision of this Mortgage shall not extend beyond such
provision or such circumstances and no other provision of this instrument shall
be affected thereby. As used herein, the term "Maximum Legal Rate of Interest"
shall mean and refer to the maximum rate of nonusurious interest, if any, that
Mortgagee may from time to time charge Mortgagor and the Obligors and in regard
to which Mortgagor and the Obligors would be prevented successfully from raising
the claim or defense of usury under applicable law as now, or to the extent
permitted by law, as may hereafter be, in effect (said law permitting the
highest rate being herein referred to as the "Interest Law"). Unless changed in
accordance with law, the applicable rate ceiling under Texas law shall be the
indicated (weekly) rate ceiling, from time to time in effect, as provided in
Article 5069-1.04 of the Texas Revised Civil Statues, as amended. It is the
intention of Mortgagor and the Obligors and Mortgagee to conform strictly to the
Interest Law applicable to this loan transaction. Accordingly, it is agreed that
notwithstanding any provision to the contrary in this Mortgage, the Notes or
in any other Loan Document, the aggregate of all interest and any other charges
or consideration constituting interest under applicable Interest Law that is
taken, reserved, contracted for, charged or received under this Mortgage, or
under any of the other aforesaid agreements or otherwise in connection with this
loan transaction shall under no circumstances exceed the maximum amount of
interest allowed by the Interest Law applicable to this loan transaction. If any
excess of interest in such respect is provided for, or shall be adjudicated to
be so provided for, in this Mortgage, in the Notes or in any other Loan
Document, then in such event (a) the provisions of this paragraph shall govern
and control, (b) neither Mortgagor, the Obligors nor their respective heirs,
legal representatives, successors or assigns or any other party liable for the
payment of Said Indebtedness shall be obligated to pay the amount of such
interest to the extent that it is in excess of the maximum amount of interest
allowed by the Interest Law applicable to this loan transaction, (c) any excess
shall be deemed a mistake and canceled automatically and, if thereto paid, shall
be credited on Said Indebtedness by Mortgagee (or if Said Indebtedness shall
have been paid in full, refunded to Mortgagor or the Obligors, as applicable),
and (d) the effective rate of interest shall be automatically subject to
reduction to the Maximum Legal Rate of Interest allowed under such Interest Law
as now or hereafter construed by courts of appropriate jurisdiction. All sums
paid or agreed to be paid the Mortgagee for the use, forbearance or detention of
the indebtedness secured hereby shall, to the extent permitted by the Interest
Law applicable to
-22-
this loan transaction, be amortized, prorated, allocated and spread throughout
the full term of the Notes.
21. PARTIAL INVALIDITY. If the lien of this Mortgage is invalid or
unenforceable as to any part of the Notes or indebtedness secured hereby, or if
the lien is invalid or unenforceable as to any part of the Mortgaged Premises,
the unsecured or partially unsecured portion of the Notes or indebtedness shall
be completely paid prior to the payment of the remaining and secured or
partially secured portion of the Notes in indebtedness, and payments made on the
Notes or indebtedness, whether voluntary or under foreclosure or other
enforcement action or procedure, shall be considered to have been first paid on
and applied to the full payment of that portion of the Notes or indebtedness
which is not secured or fully secured by the lien of this Mortgage.
22. REINSTATEMENT. In the event Mortgagee shall elect to invoke any of the
rights or remedies provided for herein, but shall thereafter determine to
withdraw or discontinue same for any reason, it shall have the unqualified right
to do so, whereupon all parties shall be automatically restored and returned to
their respective positions regarding the Said Indebtedness and this document as
shall have existed prior to the invocation of Mortgagee's rights hereunder and
the rights, powers and remedies of Mortgagee hereunder shall be and remain in
full force and effect.
23. FURTHER DOCUMENTS. Mortgagor agrees that it shall execute and deliver
such other and further documents and do and perform such other acts as may be
reasonably necessary and proper to carry out the intention of the parties as
herein expressed and to effect the purposes of this document and the loan
transaction referred to herein. Without limitation of the foregoing, Mortgagor
agrees to execute and deliver such documents as may be necessary to cause the
liens and security interests granted hereby to cover and apply to any property
placed in, on or about the Mortgaged Premises in addition to, or replacement or
substitution of any of the Mortgaged Premises.
24. SUCCESSORS AND ASSIGNS. The covenants herein contained shall inure to
the benefit of Mortgagee, the Banks, their respective legal representatives,
successors and assigns, and shall be binding upon the respective heirs, legal
representatives, successors and assigns of Mortgagor [AND BORROWER] but nothing
in this paragraph shall constitute an authorization for Mortgagor to sell or in
any way dispose of the Mortgaged Premises or any part thereof.
25. TERMINOLOGY. Wherever used in this document, unless the context
clearly indicates a contrary intent or unless otherwise specifically provided
herein, the words "Mortgage" shall mean this Mortgage, Security Agreement,
Assignment of Rents and Financing Statement, and any supplement or supplements
hereto, the word "Mortgagor" shall
-23-
mean "Mortgagor, its respective heirs, legal representatives, successors and
assigns, and/or any subsequent owner or owners of the Mortgaged Premises, "the
word "Mortgagee" shall mean "Mortgagee or any subsequent Administrative Agent
under the Credit Agreement," the word "Notes" shall mean "Notes secured by this
Mortgage and any renewals, extensions and rearrangements thereof," the word
"Person" shall mean "an individual, corporation, trust, partnership or
unincorporated association," the word "Obligors" shall mean "Obligors, their
respective heirs, legal representatives, successors and assigns," and the
pronouns of any gender shall include the other genders, and either the singular
or plural shall include the other.
26. HEADINGS. The paragraph entitlements hereof are inserted for
convenience of reference only and shall in no way alter, modify or define, or be
used in construing, the text of such paragraphs.
27. WARRANTIES OF TITLE. Notwithstanding anything to the contrary herein
set forth, the warranties of title herein contained are subject to those matters
set forth on Exhibit"B" attached hereto and made a part hereof for all purposes,
----------
to the extent, but only to the extent, the same are valid and subsisting and
effect the Mortgaged Premises.
28. CREDIT AGREEMENT. It is expressly agreed that the Notes evidence a
loan from Mortgagee and the Banks to the [MORTGAGOR/BORROWER] pursuant to the
terms of the Credit Agreement, which Credit Agreement is hereby incorporated
herein for all purposes as if set forth herein in its entirety. To the extent
the specific terms and provisions of this Mortgage expressly conflict with the
specific terms and provisions of the Credit Agreement, the specific terms and
provisions of the Credit Agreement shall control.
29. TIME IS OF THE ESSENCE. Time is of the essence in this Mortgage.
30. CHOICE OF LAW. To the extent, and only to the extent, that an election
of the laws of a forum other than ___________ would be ineffective under________
law, the validity, construction, and enforcement of this instrument shall be
governed by the laws of the State of ___________ applicable to contracts
executed and performed entirely within that state with respect to real estate
remedies, perfection and other matters so inherently local that an election of
the laws of a forum other than ____________ would be ineffective under _________
law. In all other respects, including, but not limited to, matters of usury law
and general contract law applicable to agreements between lenders and borrowers,
the validity, construction and enforcement hereof shall be determined according
to the substantive laws (but not the conflicts laws) of the State of Texas, in
which state the Mortgagee and the Banks originated the Said Indebtedness and in
which state the Notes are payable.
-24-
[31. COVENANTS, REPRESENTATIONS AND AGREEMENTS OF MORTGAGOR WITH RESPECT TO
THE GROUND LEASE.
(A) THE MORTGAGOR REPRESENTS AND WARRANTS THAT (I) THE GROUND LEASE IS IN
FULL FORCE AND EFFECT, (II) THE GROUND LEASE HAS NOT BEEN MODIFIED IN
ANY RESPECT AND (III) TO ITS KNOWLEDGE THERE ARE NO DEFAULTS BY EITHER
PARTY TO THE GROUND LEASE.
(B) THE MORTGAGOR SHALL PERFORM AND/OR OBSERVE ALL COVENANTS AND
CONDITIONS TO BE PERFORMED AND/OR OBSERVED BY THE MORTGAGOR UNDER THE
GROUND LEASE AND SHALL DELIVER TO MORTGAGEE PHOTOCOPIES OF ALL NOTICES
RECEIVED BY THE MORTGAGOR FROM THE LESSOR UNDER THE GROUND LEASE
WITHIN FIVE (5) DAYS AFTER RECEIPT THEREOF.
(C) SIMULTANEOUSLY WITH THE MAKING OF EACH PAYMENT TO THE LESSOR UNDER THE
GROUND LEASE, THE MORTGAGOR SHALL DELIVER TO THE MORTGAGEE A COPY OF
THE CHECK IN THE AMOUNT OF SUCH PAYMENT DELIVERED TO THE LESSOR UNDER
THE GROUND LEASE.
(D) IF THERE SHALL BE FILED BY OR AGAINST THE MORTGAGOR A PETITION UNDER
THE REVISED BANKRUPTCY ACT OF 1978, ET. SEQ., AS AMENDED AND ANY
-- ---
SUCCESSOR ACT THERETO (THE "BANKRUPTCY CODE") AND THE MORTGAGOR, SHALL
DETERMINE TO REJECT THE GROUND LEASE, THE MORTGAGOR SHALL GIVE THE
MORTGAGEE NOT LESS THAN FIFTEEN (15) DAYS' PRIOR WRITTEN NOTICE OF THE
DATE ON WHICH THE MORTGAGOR SHALL APPLY TO ANY COURT OR OTHER
GOVERNMENTAL AUTHORITY FOR AUTHORITY AND PERMISSION TO REJECT THE
GROUND LEASE. THE MORTGAGEE SHALL HAVE THE RIGHT, BUT NOT THE
OBLIGATION, TO SERVE UPON THE MORTGAGOR WITHIN SUCH FIFTEEN (15) DAY
PERIOD A NOTICE STATING THAT (I) THE MORTGAGEE DEMANDS THAT THE
MORTGAGOR ASSUME AND ASSIGN THE GROUND LEASE TO THE MORTGAGEE PURSUANT
TO THE BANKRUPTCY CODE, AND (II) THE MORTGAGEE COVENANTS TO CURE
AND/OR PROVIDE ADEQUATE ASSURANCE OF PROMPT CURE OF ALL DEFAULTS
REASONABLY SUSCEPTIBLE OF BEING CURED BY THE MORTGAGEE AND OF FUTURE
PERFORMANCE UNDER THE GROUND LEASE. IF THE MORTGAGEE SERVES UPON THE
MORTGAGOR THE NOTICE DESCRIBED ABOVE, THE MORTGAGOR SHALL NOT SEEK TO
REJECT THE GROUND LEASE AND SHALL COMPLY WITH THE DEMAND PROVIDED FOR
IN CLAUSE (I) ABOVE WITHIN FIFTEEN (15) DAYS AFTER THE NOTICE SHALL
HAVE BEEN GIVEN BY THE MORTGAGEE.
(E) THE MORTGAGOR HEREBY IRREVOCABLY APPOINTS THE MORTGAGEE ITS AGENT AND
ATTORNEY-IN-FACT (WHICH APPOINTMENT IS COUPLED WITH AN INTEREST) TO
PERFORM OR OBSERVE ON BEHALF OF THE MORTGAGOR, THE MORTGAGOR'S OPTION
-25-
TO PURCHASE THE MORTGAGED PREMISES (IF ANY), PURSUANT TO THE GROUND LEASE,
AND ANY COVENANT OR CONDITION WHICH THE MORTGAGOR FAILS TO PERFORM OR
OBSERVE UNDER THE GROUND LEASE WITHIN ANY APPLICABLE GRACE PERIOD SPECIFIED
IN THE GROUND LEASE, AND ANY ADVANCES MADE BY THE MORTGAGEE IN CONNECTION
WITH SUCH PERFORMANCE OR OBSERVANCE SHALL BE REPAID BY THE MORTGAGOR [AND
BORROWER] WITHIN TEN (10) DAYS OF DEMAND WITH INTEREST [AT THE INTEREST
RATE TO BE PAID UNDER THE CREDIT AGREEMENT DURING AN EVENT OF DEFAULT (THE
"DEFAULT RATE") AND THE AMOUNT SO ADVANCED, AND SHALL BE A LIEN UPON THE
MORTGAGED PREMISES, OR ANY PART THEREOF, AND SHALL BE SECURED BY THIS
MORTGAGE. SUCH PERFORMANCE OR OBSERVANCE BY THE MORTGAGEE SHALL NOT PREVENT
THE MORTGAGOR'S FAILURE SO TO PERFORM OR OBSERVE FROM CONSTITUTING A
DEFAULT UNDER THIS MORTGAGE. IN PERFORMING OR OBSERVING ANY SUCH COVENANT
OR CONDITION, THE MORTGAGEE SHALL HAVE THE RIGHT TO ENTER UPON THE
MORTGAGED PREMISES OR ANY PART THEREOF. UPON RECEIPT BY THE MORTGAGEE FROM
THE LESSOR UNDER THE GROUND LEASE OF ANY NOTICE OF DEFAULT UNDER THE GROUND
LEASE, THE MORTGAGEE MAY RELY THEREON AND TAKE ANY ACTION PERMITTED BY
THIS SECTION TO REMEDY SUCH DEFAULT NOTWITHSTANDING THAT THE EXISTENCE OF
SUCH DEFAULT OR THE NATURE THEREOF MAY BE QUESTIONED OR DENIED BY THE
MORTGAGOR.
(F) IF THE MORTGAGOR EXERCISES THE OPTION TO PURCHASE THE MORTGAGED PREMISES
(IF ANY), PURSUANT TO THE GROUND LEASE, SUCH PURCHASE OF THE MORTGAGED
PREMISES SHALL IMMEDIATELY BECOME SUBJECT TO THE LIEN HEREOF, AND SECURED
BY THIS MORTGAGE AS FULLY AND COMPLETELY, AND WITH THE SAME EFFECT, AS
THOUGH NOW OWNED BY THE MORTGAGOR AND SPECIFICALLY DESCRIBED IN THE
GRANTING CLAUSE HEREOF. NOTWITHSTANDING THE FOREGOING, AT ANY AND ALL
TIMES, THE MORTGAGOR SHALL EXECUTE, DELIVER AND ACKNOWLEDGE SUCH FURTHER
ASSURANCES, MORTGAGES AND/OR SECURITY INSTRUMENTS THE MORTGAGEE MAY REQUIRE
TO CONFIRM THE MORTGAGED PREMISES SO PURCHASED ARE SECURED BY THE LIEN OF
THIS MORTGAGE.
(G) THE MORTGAGOR EXPRESSLY AGREES THAT IF THERE SHALL BE FILED BY OR AGAINST
THE LESSOR UNDER THE GROUND LEASE ANY PETITION, ACTION AND/OR PROCEEDING
UNDER THE BANKRUPTCY CODE OR ANY OTHER SIMILAR FEDERAL AND OR STATE LAW NOW
OR HEREAFTER IN EFFECT (COLLECTIVELY HEREINAFTER REFERRED TO AS THE
"MORTGAGOR'S BANKRUPTCY"), THE MORTGAGOR SHALL NOT ELECT TO TREAT THE
GROUND LEASE AS TERMINATED, CANCELED AND/OR SURRENDERED PURSUANT TO
APPLICABLE PROVISIONS OF THE BANKRUPTCY CODE INCLUDING, BUT NOT LIMITED TO,
SECTION 365 (H)(1), WITHOUT THE MORTGAGEE'S PRIOR WRITTEN CONSENT. IN THE
EVENT OF THE MORTGAGOR'S BANKRUPTCY, THE MORTGAGOR
-26-
EXPRESSLY COVENANTS AND AGREES, INTENDING THAT THE MORTGAGEE RELY THEREON,
THAT IT SHALL REAFFIRM AND RATIFY THE LEGALITY, VALIDITY, BINDING EFFECT
AND ENFORCEABILITY OF THE GROUND LEASE TO THE MORTGAGEE AND THE MORTGAGOR
ALSO COVENANTS AND AGREES THAT IT SHALL REMAIN IN POSSESSION OF THE
MORTGAGED PREMISES AND THE LEASEHOLD ESTATE CREATED BY THE GROUND LEASE,
NOTWITHSTANDING ANY REJECTION THEREOF BY THE LESSOR UNDER THE GROUND
LEASE AND/OR ANY TRUSTEE, CUSTODIAN, RECEIVER OR OTHER SIMILAR OFFICIAL.
(H) THE LIEN OF THIS MORTGAGE ATTACHES TO ALL OF THE MORTGAGOR'S RIGHTS AND
REMEDIES NOW AND HEREAFTER ARISING UNDER OR PURSUANT TO THE BANKRUPTCY
CODE, INCLUDING, BUT NOT LIMITED TO, THE MORTGAGOR'S RIGHT TO ELECT TO
REMAIN IN POSSESSION OF THE MORTGAGED PREMISES AND THE LEASEHOLD ESTATE
CREATED BY THE GROUND LEASE IN THE EVENT OF THE MORTGAGOR'S BANKRUPTCY
PURSUANT TO SECTION 365(H)(1). ANY SUCH ELECTION TO TERMINATE, CANCEL
AND/OR SURRENDER THE GROUND LEASE IN THE EVENT OF THE MORTGAGOR'S
BANKRUPTCY WITHOUT THE MORTGAGEE'S PRIOR WRITTEN CONSENT SHALL BE NULL AND
VOID.
(I) THE MORTGAGOR HEREBY UNCONDITIONALLY ASSIGNS, TRANSFERS, AND SETS OVER TO
THE MORTGAGEE FOR THE BENEFIT OF THE BANKS (I) ALL OF THE MORTGAGOR'S
CLAIMS AND RIGHTS TO DAMAGES, AND ANY OTHER REMEDIES IN CONNECTION
THEREWITH ARISING FROM ANY REJECTION OF THE GROUND LEASE BY THE LESSOR
THEREUNDER PURSUANT TO THE BANKRUPTCY CODE IN THE EVENT OF THE MORTGAGOR'S
BANKRUPTCY, AND/OR BY ANY TRUSTEE, CUSTODIAN, RECEIVER OR OTHER SIMILAR
OFFICIAL. THE MORTGAGEE SHALL HERE THE RIGHT, BUT NOT THE OBLIGATION, TO
PROCEED IN ITS OWN NAME AND/OR IN THE NAMES OF THE MORTGAGOR IN RESPECT OF
ANY CLAIM, SUIT, ACTION AND/OR PROCEEDING RELATING TO SUCH REJECTION OF THE
GROUND LEASE, INCLUDING, BUT NOT LIMITED TO, THE RIGHT TO FILE AND
PROSECUTE, TO THE EXCLUSION OF THE MORTGAGOR, ANY AND ALL PROOFS OF CLAIMS,
COMPLAINTS, NOTICES AND OTHER DOCUMENTS IN ANY CASE IN RESPECT OF THE
LESSOR OF THE GROUND LEASE UNDER AND PURSUANT TO THE BANKRUPTCY CODE, AND
(II) THE MORTGAGOR'S RIGHT OF ELECTION TO REMAIN IN POSSESSION OF THE
MORTGAGED PREMISES IN THE EVENT OF THE MORTGAGOR'S BANKRUPTCY UNDER AND
PURSUANT TO SECTION 365(H)(L) OF THE BANKRUPTCY CODE. THIS ASSIGNMENT
CONSTITUTES A PRESENT, ABSOLUTE, IRREVOCABLE AND UNCONDITIONAL ASSIGNMENT
OF THE FOREGOING CLAIMS, ELECTIONS, RIGHTS AND REMEDIES, AND SHALL CONTINUE
IN FULL FORCE AND EFFECT UNTIL THE NOTES AND THE SAID INDEBTEDNESS HAVE
BEEN PAID IN FULL AND THIS MORTGAGE HAS BEEN SATISFIED AND DISCHARGED. ANY
AMOUNTS RECEIVED BY THE MORTGAGEE AND THE BANKS AS DAMAGES ARISING OUT OF
THE REJECTION OF
-27-
THE GROUND LEASE BY THE LESSOR THEREUNDER SHALL BE APPLIED IN THE MANNER
SET FORTH IN PARAGRAPH 9 OF THIS MORTGAGE.
(J) IF, PURSUANT TO ANY APPLICABLE SECTION OF THE BANKRUPTCY CODE, THE
MORTGAGOR SEEKS TO OFFSET, COUNTERCLAIM, DEDUCT, AND/OR ASSERTS A DEFENSE
AGAINST THE RENT, ADDITIONAL RENT OR OTHER SUMS DUE UNDER THE GROUND LEASE,
THE AMOUNT OF ANY DAMAGES CAUSED BY THE NON-OBSERVANCE AND/OR NON-
PERFORMANCE OF THE LESSOR UNDER THE GROUND LEASE, THE MORTGAGOR SHALL,
PRIOR TO SUCH OFFSET, COUNTERCLAIM, DEFENSE AND/OR DEDUCTION NOTIFY THE
MORTGAGEE OF ITS INTENT TO DO SO, SETTING FORTH WITH SPECIFICITY THE
AMOUNTS PROPOSED TO BE OFFSET, COUNTERCLAIMED, DEDUCTED, AND/OR DEFENDED
AGAINST AND FOR WHAT PURPOSES. THE MORTGAGEE FOR THE BENEFIT OF THE BANKS
SHALL THEREUPON HAVE THE RIGHT, BUT NOT THE OBLIGATION, TO OBJECT TO ALL OR
ANY PART OF SUCH OFFSET, COUNTERCLAIM AND/OR DEDUCTION AND, IN THE EVENT OF
SUCH OBJECTION, THE MORTGAGOR SHALL NOT EFFECT ANY SUCH OFFSET COUNTERCLAIM
AND/OR DEDUCTION. NEITHER THE MORTGAGEE'S FAILURE TO OBJECT TO ANY SUCH
OFFSET, COUNTERCLAIM AND/OR DEDUCTION NOR ANY OBJECTION TO ANY SUCH OFFSET,
COUNTERCLAIM AND/OR DEDUCTION NOR ANY OBJECTION OR OTHER COMMUNICATION
BETWEEN THE MORTGAGEE AND THE MORTGAGOR SHALL CONSTITUTE AN APPROVAL OF ANY
SUCH OFFSET, COUNTERCLAIM, DEDUCTION AND/OR DEFENCE BY THE MORTGAGEE. THE
MORTGAGOR [AND BORROWER] EXPRESSLY AGREE[S] TO PAY, PROTECT, INDEMNIFY AND
SAVE HARMLESS THE MORTGAGEE FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS,
ACTIONS, SUIT, PROCEEDINGS, DAMAGES, LOSSES, LIABILITIES, JUDGMENTS, COSTS
AND EXPENSES OF EVERY KIND AND NATURE (INCLUDING REASONABLE ATTORNEYS'
FEES) ARISING FROM OR RELATING TO ANY OFFSET, COUNTERCLAIM DEDUCTION AND/OR
ASSERTION OF A DEFENSE BY THE MORTGAGOR AS HEREIN DESCRIBED.
(K) IF ANY ACTION, PROCEEDING, MOTION AND/OR NOTICE SHALL BE COMMENCED OR FILED
WITH RESPECT TO THE MORTGAGOR OR THE MORTGAGED PREMISES, OR ANY PART
THEREOF, IN CONNECTION WITH THE BANKRUPTCY CODE, THE MORTGAGEE SHALL BE
ENTITLED TO APPROVE OF MORTGAGOR'S SELECTION OF ANY COUNSEL RETAINED IN
CONNECTION THEREWITH AND SHALL ALSO HAVE APPROVAL RIGHTS OVER ALL ASPECTS
OF ANY ENSUING LITIGATION. ALTERNATIVELY, THE MORTGAGEE MAY PROCEED IN ITS
OWN NAME IN CONNECTION WITH ANY SUCH LITIGATION, AND THE MORTGAGOR
EXPRESSLY AGREES TO EXECUTE AND DELIVER ALL AND EVERY POWER, CONSENT,
AUTHORIZATION AND OTHER DOCUMENTS REQUIRED BY THE MORTGAGEE IN CONNECTION
THEREWITH. THE MORTGAGOR [AND BORROWER] SHALL PAY TO THE MORTGAGEE ON
DEMAND ANY AND ALL COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEYS'
FEES) PAID OR INCURRED AND PAYABLE BY THE MORTGAGEE IN CONNECTION WITH SUCH
LITIGATION AND THE COSTS AND EXPENSES SHALL BE SECURED BY THE LIEN OF THIS
MORTGAGE. THE MORTGAGOR ALSO AGREES
-28-
NOT TO COMMENCE ANY ACTION, SUIT, PROCEEDING AND/OR CASE OR FILE ANY
APPLICATION OR MAKE ANY MOTION IN RESPECT OF THE GROUND LEASE IN THE
EVENT OF THE MORTGAGOR'S BANKRUPTCY WITHOUT THE PRIOR WRITTEN CONSENT
OF THE MORTGAGEE.
(L) THE MORTGAGOR HEREBY IRREVOCABLY APPOINTS THE MORTGAGEE ITS AGENT AND
ATTORNEY-IN-FACT (WHICH APPOINTMENT IS COUPLED WITH AN INTEREST) TO
OBSERVE AND PERFORM ON BEHALF OF THE MORTGAGOR THE COVENANTS AND
AGREEMENTS CONTAINED IN THIS SECTION AND ANY ADVANCES MADE BY THE
MORTGAGEE IN CONNECTION WITH SUCH PERFORMANCE OR OBSERVANCE SHALL BE
REPAID BY THE MORTGAGOR [AND BORROWER] WITHIN TEN (10) DAYS OF DEMAND
WITH INTEREST AT THE DEFAULT RATE AND THE AMOUNT SO ADVANCED, AND
INTEREST THEREON, SHALL BE A LIEN UPON THE MORTGAGED PREMISES AND
SHALL BE SECURED BY THIS MORTGAGE. SUCH PERFORMANCE OR OBSERVANCE BY
THE MORTGAGEE SHALL NOT PREVENT THE MORTGAGOR'S FAILURE TO PERFORM OR
OBSERVE FROM CONSTITUTING A DEFAULT UNDER THIS MORTGAGE.
(M) IF THE MORTGAGOR SHALL DEFAULT UNDER ANY OF ITS OBLIGATIONS WITH
RESPECT TO THE GROUND LEASE, AND SUCH DEFAULT IS NOT CURED WITHIN ANY
APPLICABLE GRACE PERIOD PROVIDED FOR IN THE GROUND LEASE, OR IF THE
ESTATE CREATED BY THE GROUND LEASE SHALL BE SURRENDERED, OR IF THE
GROUND LEASE SHALL BE ASSIGNED, CANCELLED, TERMINATED, SUPPLEMENTED,
EXTENDED, MODIFIED AND/OR AMENDED WITHOUT THE PRIOR WRITTEN CONSENT OF
THE MORTGAGEE, THEN SUCH SHALL AUTOMATICALLY AND WITHOUT ANY NOTICE TO
THE MORTGAGOR BY THE MORTGAGEE, BE A DEFAULT UNDER THIS MORTGAGE.]
-29-
EXECUTED this the _______ day of __________, 1996.
Mortgagor's Address: MORTGAGOR:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ___________________
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention:_____________
By:_________________
Name:_______________
Title:______________
Mortgagee's Address:
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
P.O. Box 655415
Commercial Real ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
[ADD APPROPRIATE FORM OF ACKNOWLEDGMENT]
-30-
EXHIBITS
Exhibit "A" - Legal Description
Exhibit "B" - Permitted Exceptions
-31-
EXHIBIT X
NOTICE OF BORROWING
[Date]
Bank One, Texas, N.A.,
as Administrative Agent under the Credit Agreement herein described
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 4th Floor
Commercial Real Estate Lending
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
Ladies and Gentlemen:
The undersigned, American General Hospitality Operating Partnership, L.P., a
Delaware limited partnership (the "Borrower"), refers to the Credit Agreement
dated as of July 31, 1996 (as the same may be amended or modified from time to
time, the "Credit Agreement," the defined terms of which are used in this Notice
of Borrowing unless otherwise defined in this Notice of Borrowing) among the
Borrower, the Banks, the Agent, the Structuring Agent and the Administrative
Agent, and hereby gives you irrevocable notice pursuant to Section 2.02(a) of
the Credit Agreement that the undersigned hereby requests a Borrowing, and in
connection with that request sets forth below the information relating to such
Borrowing (the "Proposed Borrowing") as required by Section 2.02(a) of the
Credit Agreement:
(a) Business Day of the Proposed Borrowing is ___________________,
19________.
(b) The Proposed Borrowing will be a Borrowing composed of [Prime Rate
Advances] [LIBOR Rate Advances].
(c) The aggregate amount of the Proposed Borrowing is $_______________.
(d) The Interest Period for each LIBOR Rate Advance made as part of the
Proposed Borrowing is [______month[s]].
(e) The Proposed Borrowing is going to be used for:
i. The following acquisition of a Future Property:
Bank One, Texas, N.A.
[Date]
Page 2
ii. The following Capital Expenditures and FF&E:
iii. The following working capital:
iv: The following other uses:
The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the Proposed Borrowing:
(a) the representatives and warranties contained in the Credit Agreement
and the other Security Documents are correct in all material respects,
before and after giving effect to the Proposed Borrowing and the
application of the proceeds therefrom, as though made on the date of the
Proposed Borrowing; and
(b) no Default has occurred and remains uncured, or would result from such
Proposed Borrowing or from the application of the proceeds therefrom.
Very truly yours,
AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P.
BY: AGH GP, INC., its general partner
By:_____________________________________
Name:____________________________
Title:___________________________
EXHIBIT Y
NOTICE OF CONVERSION OR CONTINUATION
[Date]
Bank One, Texas, N.A.
as Administrative Agent under the Credit Agreement herein described
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 4th Floor
Commercial Real Estate Lending
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
Ladies and Gentlemen:
The undersigned, American General Hospitality Operating Partnership, L.P., a
Delaware limited partnership (the "Borrower"), refers to the Credit Agreement
dated as of July 31, 1996 (as the same may be amended or modified from time to
time, the "Credit Agreement," the defined terms of which are used in this Notice
of Conversion or Continuation unless otherwise defined in this Notice of
Conversion or Continuation), among the Borrower, the Banks, the Structuring
Agent, and the Administrative Agent, and hereby gives you irrevocable notice
pursuant to Section 2.02(b) of the Credit Agreement that the undersigned hereby
requests a Conversion or continuation of an outstanding Borrowing, and in
connection with that request sets forth below the information relating to such
Conversion or continuation (the "Proposed Borrowing") as required by Section
2.02(b) of the Credit Agreement:
(a) The Business Day of the Proposed Borrowing is ____________, 19___.
(b) The Proposed Borrowing will be a Borrowing composed of [Prime Rate
Advances] [LIBOR Rate Advances].
(c) The aggregate amount of the Borrowing to be Converted or continued is
$______ and consists of [Prime Rate Advances] [LIBOR Rate Advances].
(d) The Proposed Borrowing consists of [a Conversion to [Prime Rate
Advances] [LIBOR Rate Advances]] [a continuation of [Prime Rate Advances]
[LIBOR Rate Advances]].
Bank One, Texas, N.A.
[Date]
Page 2
(e) The Interest Period for each LIBOR Rate Advance made as part of the
Proposed Borrowing is [_____ month[s]].
Very truly yours,
AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P.
By: AGH GP, Inc., its general partner
By:_______________________________________
Name:__________________________
Title:_________________________
EXHIBIT "Z"
FORM OF
Recording Requested By And
When Recorded Mail to:
Bracewell & ▇▇▇▇▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
THE STATE OF ___________ (S)
(S)
COUNTY OF ______________ (S)
LESSEE ESTOPPEL, ACKNOWLEDGMENT AND SUBORDINATION AGREEMENT
THIS LESSEE ESTOPPEL, ACKNOWLEDGMENT AND SUBORDINATION AGREEMENT (this
"Agreement") is made as of the ___ day of July, 1996, by AGH LEASING, L.P., a
Delaware limited partnership ("Lessee"), having an office and mailing address at
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇ ▇▇▇▇
("Lessee"), in favor of BANK ONE, TEXAS, N.A., a national banking association,
as administrative agent ("Agent") for the Banks (as hereinafter defined), having
an office and mailing address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 4th Floor, Commercial Real
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice
President.
WITNESSETH:
WHEREAS, American General Hospitality Operating Partnership, L.P., a
Delaware limited partnership ("Borrower") Agent, as Administrative Agent,
Societe Generale, Southwest Agency, as Structuring Agent, and the banks and
other lenders party thereto (collectively the "Banks") have entered into a
Credit Agreement dated as of ___________, 1996 (as amended or otherwise modified
from time to time, the "Credit Agreement"); and
WHEREAS, Borrower or a subsidiary of Borrower ("Lessor") is leasing or
subleasing the land described on Exhibit "A" attached hereto and the
improvements, equipment, fixtures, furniture and other personal property located
on such land (collectively, the "Property") to Lessee under that certain lease
executed between Lessor and Lessee (the "Lease"); and
WHEREAS, to secure Lessee's obligations to Lessor under the Lease Lessee
executed or caused to be executed the following (collectively, the "Collateral
Documents");
a. the Assignment of Management Agreements executed by Lessee
to Lessor in connection with the Property;
b. the Assignment of Leases, Rents and Security Deposits
executed by Lessee to Lessor in connection with the Property;
c. the General Assignment and Agreement executed by Lessee to
Lessor in connection with the Property;
d. those instruction letters or agreements executed in
connection with the Property pursuant to which upon the occurrence of
certain events certain depository institutions have agreed wire transfer
funds in various bank accounts of Lessee to a bank account at Agent held in
the name of the Borrower;
e. those instruction letters or agreements executed in
connection with the Property pursuant to which certain credit card
companies have agreed to wire transfer funds owed Lessee into certain bank
accounts of Lessee;
WHEREAS, the Borrower has executed promissory notes of even date with the
Credit Agreement in favor of the Banks in the original aggregate principal
amount of $100,000,000.00 (the "Notes", which term includes any modification,
renewal, extension or alteration thereof); and
WHEREAS, the payment of the indebtedness from time to time evidenced by the
Notes, the payment of all other sums now or hereafter owing by Borrower or
certain other parties under the Credit Agreement or under any other document or
instrument now or hereafter evidencing or securing the aforesaid indebtedness or
otherwise executed in connection herewith or therewith (the Collateral
Assignment (as hereinafter defined), the Notes, the Credit Agreement, the
Mortgage (as hereinafter defined), and all other documents and instruments now
or hereafter evidencing or securing the aforesaid indebtedness or otherwise
executed in connection herewith or therewith, being hereinafter referred to
collectively as the "Credit Documents"), and the performance and observance of
all covenants, agreements, conditions and other provisions set forth herein, in
the Notes and in the other Credit Documents shall be collectively referred to
herein as the "Obligations");
WHEREAS, to secure the Obligations, Lessor mortgaged the Property and
Lessor's rights, title and interests under the Property (including without
limitation the Lease and Lessor's rights, title and interests in and to the
Lease) to Agent for the benefit of the Banks pursuant to a [DEED OF
TRUST/MORTGAGE], Security Agreement, Assignment of Rents and Financing Statement
(the "Mortgage") and certain other security documents (collectively, the
"Security Documents");
-2-
WHEREAS, to further secure the Obligations, Lessor pledged the Collateral
Documents and Lessor's rights, title and interests under the Collateral
Documents to Agent for the benefit of the Banks pursuant to a Collateral
Assignment and Security Agreement (the "Collateral Assignment") between Lessor
and Agent;
WHEREAS, as a condition to the advancing of funds under the Notes, Lessee
agreed to execute and deliver this Agreement;
NOW, THEREFORE, IN CONSIDERATION of the sum of TEN AND NO/100 DOLLARS
($10.00) in hand paid by Agent to Lessee, Lessee hereby makes certain
representations, covenants and agreements in favor of Agent as set forth herein.
1. Estoppel.
--------
a. The Lease and the Collateral Documents constitute the entire and
only agreements between Lessor and Lessee with respect to the Property.
b. A true and correct copy of the Lease and the Collateral Documents
and all agreements, amendments, guarantees, side letters and other documents
relating thereto have been previously delivered to Agent by Lessor and Lessee.
c. The Lease and the Collateral Documents are in full force and
effect. Neither the Lease, the Collateral Documents nor any interest therein has
been assigned, mortgaged, pledged or otherwise encumbered by Lessee.
d. Neither the collateral pledged to Lessor under the Collateral
Documents, nor any interest therein has been assigned, mortgaged, pledged or
otherwise encumbered by Lessee except to Lessor pursuant to the Collateral
Documents.
▇. ▇▇▇▇▇▇ does not hold any security deposit under the Lease.
f. No default, or event that but for the passage of time or the
giving of notice, or both, would constitute a default, exists under the Lease on
the part of Lessor.
g. No bankruptcy or insolvency proceedings have been instituted by,
or against, Lessee.
2. Covenants.
---------
-3-
a. Lease. Lessee shall keep the Lease in full force and effect, and
-----
the Lease shall not be amended, modified, waived, extended or voluntarily
terminated (subject to the terms of Section 4 of this Agreement) without the
prior written consent of Agent, which consent may be granted or denied in
Agent's sole discretion. Lessee shall not assign the Lease or encumber all or
any portion of the Property or Lessee's leasehold interest therein without the
prior written consent of Agent, which consent may be granted or denied in
Agent's sole discretion.
b. Irrevocable Directions to Pay; Payment of Rents to Lenders.
----------------------------------------------------------
Lessee hereby acknowledges receipt of that certain Irrevocable Direction to Pay
(the "Direction to Pay") executed by Lessor and certain affiliates of Lessor.
Lessee hereby agrees that Lessee shall pay all base rent, participating rent and
all other amounts as may become due and payable by Lessee to Lessor under and
pursuant to the Lease directly to the Agent pursuant to the Direction to Pay
until such time as the Agent shall notify the Lessee that the Obligations have
been paid and performed in full.
3. Consent; Waiver. Lessee hereby consents to the assignment of the
---------------
Lease, the Collateral Documents and Lessor's rights, title and interests
thereunder by Lessor to Agent pursuant to the Mortgage and the Collateral
Assignment as security for the repayment of the Obligations and agrees that
Lessor shall not be in default under the Lease by reason of having made such
assignments. Lessee acknowledges and agrees that until the Mortgage and
Collateral Assignment are released (a) no consent by Lessor under the Lease
shall be effective without the written consent of Agent and (b) Agent shall have
the right, but not the obligation, to take any action permitted Lessor under the
Lease or the Collateral Documents in connection with a default by Lessee
thereunder to the extent permitted by the Credit Agreement or Security
Documents.
4. Subordination; Foreclosure; Termination.
---------------------------------------
a. Subordination. Lessee has subordinated and does hereby
-------------
subordinate all of its rights, liens and security interests in and to the
Property and in, to and under the Lease to the following: (i) the Credit
Documents; (ii) all renewals, substitutions, extensions, modifications,
replacements or amendments of the Credit Documents; and (iii) the Obligations
and all other indebtedness secured by the Credit Documents and all advances
thereunder. Notwithstanding anything in the Lease to the contrary, no early
termination fee shall be due and payable under the Lease and Lessee shall not
collect any such fee prior to the repayment in full of the Obligations with no
further obligation to make advances to Borrower under the Credit Agreement.
b. Foreclosure; Termination; Survival. Notwithstanding anything in
----------------------------------
the Lease to the contrary, upon the acquisition of the Property by Agent or a
nominee of Agent or the Banks by foreclosure or by deed-in-lieu of foreclosure,
or by any other person through foreclosure (any of such entities or persons
being referred to herein as a "Subsequent Owner"), the Lease shall be
-4-
automatically terminated, without payment by the Subsequent Owner of any
termination fee, penalty or liquidated damages assessed by reason of
termination prior to the natural expiration of the term or terms thereof, and
Lessee shall have no further right whatsoever in regard to the Property and
Lessee shall vacate the same immediately. Lessee shall indemnify and hold Agent
and the Banks harmless from any losses or damages suffered by them on account of
the failure by Lessee to surrender possession of the Property at the time
required under this Section 4. Agent's rights under this Agreement and under the
Collateral Assignment and the Lessor's rights under the Collateral Documents
shall survive any termination of the Lease.
5. Notice of Default; Agent's Right to Cure Lessor Defaults; Lessee's
------------------------------------------------------------------
Right to Purchase Loan.
----------------------
a. Lessee shall deliver to Agent at the address stated above or such
other address as Agent shall notify Lessee thereof in writing, by certified
mail, a copy of any notice of default served upon Lessor relating to defaults of
Lessor with respect to any Lease contemporaneously with the delivery of such
notice to Lessor. No notice to Lessor shall be effective, no applicable cure
period shall begin to run and neither Agent nor the Banks nor any person
succeeding to their respective interests shall have any obligation to cure
defaults of Lessor unless and until Agent has received a copy of such notice.
Before Lessee may exercise any remedies available to Lessee under a Lease by
virtue of Lessor's default thereunder, Agent, on behalf of Banks, shall be
permitted (but shall not be obligated) to cure any such default by Lessor with
respect to the Lease within thirty (30) days after receipt of such notice. If
such default cannot be cured within the aforesaid thirty (30) days, then Agent
shall have such additional period of time as may be necessary to cure such
default, if within such thirty (30) days, Agent has commenced and is diligently
pursuing the remedies necessary to cure such default (including without
limitation the commencement of foreclosure proceedings if necessary to effect
such a cure), in which event any remedies of Lessee under the Lease, including,
without limitation, such right, if any, as Lessee might otherwise have to
terminate the Lease, shall not be exercised while such remedies are being so
diligently pursued. In addition, Lessee agrees to promptly deliver to Agent a
copy of any written notice of default received from or given to any franchisor,
licensor, manager, or liquor license company with which Lessee has entered into
an agreement or contract related to the Property.
6. Disclaimer of Responsibility. This Agreement shall not operate to
----------------------------
place any responsibility, liability or obligation whatsoever upon Agent or upon
the Banks, except as expressly set forth herein.
7. No waiver. Any forbearance or failure or delay by Agent or the Banks
---------
in exercising any right, power or remedy shall not preclude the further exercise
thereof, and every right, power
-5-
or remedy of Agent or the Banks shall continue in full force and effect until
such right, power or remedy is specifically waived in a writing executed by
Agent.
8. Expenses. If Lessee fails to comply with the terms of this Agreement,
--------
Lessee shall pay all reasonable attorneys' fees and expenses actually incurred
by Agent and the Banks in connection with the enforcement of this Agreement.
9. Representations and Warranties. Lessee represents and warrants to
------------------------------
Banks as follows:
a. Lessee is duly organized and validly existing under the laws of
the State of its organization and is duly qualified to do business in all
jurisdictions in which the Hotels are located.
b. The execution, delivery and performance by Lessee of this
Agreement (i) are within the power of Lessee, (ii) have been duly authorized
by all requisite action of Lessee, (iii) have received all necessary
governmental approvals which are applicable to Lessee, and (iv) will not violate
(a) any provision of law which is applicable to Lessee, (b) any order of any
court or agency of government which is applicable to Lessee, (c) the
organizational documents of Lessee, or (d) any indenture, agreement or any
other instrument to which Lessee is a party or by which Lessee or its property
is bound, or result in a breach of or constitute (with due notice and/or lapse
of time) a default under any such indenture, agreement or other instrument or
result in the creation or imposition of any lien, charge or encumbrance of any
nature whatsoever upon any of Lessee's property or assets.
10. Assignment; Binding Effect. The Banks may assign their rights, in
--------------------------
whole or in part, under this Agreement to any party to whom the Credit Documents
are assigned, and Lessee hereby irrevocably consents and agrees to the same.
Neither this Agreement nor any of the provisions contained herein shall be for
the benefit of third parties whether or not specifically mentioned herein.
Subject to the foregoing, this Agreement shall inure to the benefit of and bind
the successors and assigns of the Banks, and, should an assignment by Lessee be
permitted hereunder, shall inure to the benefit of and bind the successors and
assigns of Lessee.
11. Governing Law. THIS AGREEMENT AND ANY DEALINGS BETWEEN THE PARTIES TO
-------------
THIS AGREEMENT RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR THE
RELATIONSHIPS THAT ARE BEING ESTABLISHED HEREBY AND THEREBY SHALL BE GOVERNED
BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE OF TEXAS, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. WHERE
APPLICABLE AND EXCEPT AS OTHERWISE DEFINED HEREIN, THE TERMS HEREOF SHALL HAVE
THE
-6-
MEANINGS GIVEN THEM IN THE UNIFORM COMMERCIAL CODE, AS ENACTED IN THE STATE OF
TEXAS.
12. Consent to Jurisdiction and Services of Process. Lessee hereby
-----------------------------------------------
irrevocably submits generally and unconditionally for itself and in respect of
its property to the jurisdiction of any state court, or any United States court,
sitting in the State of Texas, over any suit, action or proceeding arising out
of or relating to this Agreement. Lessee hereby irrevocably waives, to the
fullest extent permitted by law, any objection that if may now or hereafter have
to the laying of venue in any such court and any claim that any such court is an
inconvenient forum. Any such proceeding against Lessee brought in the State of
Texas may be removed to a federal court of competent jurisdiction in the State
of Texas. Lessee hereby agrees and consents that, in addition to any methods of
service of process provided for under the laws of the State of Texas, all
service of process in any such suit, action or proceeding in any state court, or
any United States federal court, sitting in the State of Texas, may be made by
certified or registered mail, return receipt requested, directed to Lessee at
its address for notice stated herein or at a subsequent address of which Agent
received actual written notice from Lessee in accordance with this Agreement,
and service so made shall be complete within five (5) days after the same shall
have been so mailed. Nothing herein shall affect the right of Banks to serve
process in any manner permitted by law or limit the right of Banks to bring
proceedings against Lessee in any other court or jurisdiction.
13. Waiver of Jury Trial. Lessee hereby knowingly and voluntarily waives
--------------------
its rights to a jury trial of any claim or cause of action based upon or arising
out of this Agreement or any other documents executed in connection with this
Agreement or any dealings between Lessee and Banks relating to the subject
matter of the transactions contemplated hereby and the business relationship
that is being established between them.
The scope of this waiver is intended to be all-encompassing of any and all
disputes that may be filed in any court and that relate to the subject matter of
this transaction, including contract claims, tort claims, breach of duty claims
and all other common law and statutory claims. Lessee acknowledges that this
waiver is a material inducement to enter into a business relationship, that
Agent and Banks have already relied on this waiver in entering into this
Agreement, and that Agent and Banks will continue to rely on this waiver in
their related future dealings. Lessee further warrants and represents that it
has reviewed this waiver with its legal counsel and it knowingly and voluntarily
waives its jury trial rights following consultation with legal counsel. THIS
WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN
WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR TO ANY OTHER DOCUMENTS OR
AGREEMENTS RELATING TO THE
-7-
TRANSACTION MADE HEREUNDER. In the event of litigation, this Agreement may be
filed as a written consent to a trial by the court.
14. Notices. All notices and demand given under this Agreement shall be
-------
in writing and shall be served by personal delivery courier service or
registered or certified mail. Any such notice shall be fully prepaid and
addressed to the party served at its address as set forth above. Service of any
such notice or demand so made shall be deemed effective as of the date of actual
delivery if sent by personal courier service, or if sent by registered or
certified mail, three (3) days after the date of actual delivery as shown by the
addressee's return receipt, except that service of any notice of default
provided or required by law shall, if mailed, be deemed effective on the date of
mailing.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective duly authorized representatives under seal as of
the day and year first above written.
LESSEE:
Signed, sealed and AGH LEASING, L.P.,
delivered in the presence of: a Delaware limited partnership
__________________________________ By: ___________________
Unofficial Witness its general partner
By:________________________
___________________________________ Name:______________________
Notary Public Title______________________
My Commission Expires:
[AFFIX NOTARIAL SEAL]
AGENT:
Signed, sealed and BANK ONE, TEXAS, N.A.
delivered in the presence of:
__________________________________ By: _______________________
Unofficial Witness Name:_______________________
-8-
Title:______________________
_________________
Notary Public
My Commission Expires:
[AFFIX NOTARIAL SEAL]
-9-
EXHIBIT "AA"
FORM OF:
PROPERTY ADJUSTMENT REPORT
This Property Adjustment Report is executed this ___ day of ________, 1996
and is prepared pursuant to Section 2.14 of that certain Credit Agreement (the
"Agreement") between AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership (the "Borrower"), SOCIETE GENERALE, SOUTHWEST
AGENCY, as Structuring Agent, BANK ONE, TEXAS, N.A., as Administrative Agent,
and the Banks parties to the Credit Agreement. Capitalized terms used herein
but not otherwise defined herein shall have the meanings specified by the
Agreement:
Borrowing Base as
of last Borrowing Property Adjusted
Base Certificate Adjustment Borrowing Base
1. Real Estate Value $______ $______ $______
2. Line 1 above multiplied
by 40% $______ $______ $______
3. The trailing twelve
months Borrowing Base
EBITDA $______ $______ $______
4. Line 3 above multiplied
by five (5) $______ $______ $______
5. BORROWING BASE
(Lesser of Lines 2 and 4) $______ $______ $______
The Borrower has caused this Property Adjustment Report to be executed this
_____ day of _________, 199__.
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P.
By: AGH GP, Inc., its general partner
By:______________________________
Name:____________________________
Title:___________________________
EXHIBIT "BB"
PROPERTY CERTIFICATE
This Property Certificate is executed this ___ day of ___________, 1996 and
is prepared pursuant to Section 3.04 of that certain Credit Agreement (the
"Agreement") between AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership (the "Borrower"), SOCIETE GENERALE, SOUTHWEST
AGENCY, as Structuring Agent, BANK ONE, TEXAS, N.A., as Administrative Agent,
and the Banks parties to the Credit Agreement. Capitalized terms used herein but
not otherwise defined herein shall have the meanings specified by the Agreement.
This Property Certificate is being given in connection with the following
Hotel Property: _______________________________________________________________.
I, __________________, hereby certify that I am the duly elected
representative of __________________________________________, a
________________________, and hereby further certify that a true and correct
copy of the following documents relating to or for such Hotel Property are
attached hereto as Exhibits A-[K].
Exhibit A: The Franchise Agreement;
Exhibit B: The Management Agreement;
Exhibit C: The Participating Lease;
Exhibit D: The List of the Personal Property for such Hotel Property;
Exhibit E: The Acquisition Agreements;
Exhibit F: A rent roll for the Hotel Property identifying all rentable
space within the Hotel Property, the tenant, concessionaire or
licensee (or if vacant, identified as vacant), the monthly
rental payable (including any adjustments to operating
expenses), the date through which rent is paid, the
termination date of each such leases, concessions and licenses
and a delinquency report.
Exhibit G: The occupancy permit;
Exhibit H: The liquor license for such Hotel Property;
Exhibit I: The Liquor License Concession Agreement and any other
agreements related to the liquor license(s);
[Exhibit J: The Property Owner's articles of incorporation, by-laws,
partnership agreements, as applicable, and certificates of
existence, good standing and authority to do business from
each appropriate state authority, and partnership or
corporate, as applicable, authorizations authorizing the
execution, delivery and performance of the Security Documents
all certified to be true and complete by a duly authorized
officer of such Property Owner; and]
[Exhibit K: If the Hotel Property is subject to a Ground Lease, the
Ground Lease.]
IN WITNESS WHEREOF, I have hereto set my hand this ____ day of
___________________, 199___.
_______________________________,
a __________________
By:________________________________
Name:______________________________
Title:_____________________________
-2-
EXHIBIT "CC"
FORM OF
SECURITY AGREEMENT
This Security Agreement dated as of July ____, 1996 (as may be hereafter
amended or otherwise modified from time to time, this "Agreement") is made by
AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP, L.P., a Delaware limited
partnership ("Borrower"), and the other undersigned entities (the Borrower and
the other signatories being collectively referred to herein as "Debtor") having
an office and mailing address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇ ▇▇▇▇ in favor of BANK ONE, TEXAS, N.A., a national
banking association, as administrative agent ("Secured Party") for the Banks (as
hereinafter defined), having an office and mailing address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
4th Floor, Commercial Real ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President.
WITNESSETH:
WHEREAS, Borrower, Secured Party, as Administrative Agent, Societe
Generale, Southwest Agency, as Structuring Agent, and the banks and other
lenders party thereto (collectively the "Banks") have entered into a Credit
Agreement dated as of ___________, 1996 (as amended or other wise modified from
time to time, the "Credit Agreement"); and
WHEREAS, the Borrower has executed promissory notes of even date with the
Credit Agreement in favor of the Banks in the original aggregate principal
amount of $100,000,000.00 (the "Notes", which term includes any modification,
renewal, extension or alteration thereof); and
WHEREAS, the Notes were executed and delivered to Secured Party and the
Banks, and shall be due and payable in accordance with the Credit Agreement; and
WHEREAS, the terms and provisions of the Notes and Credit Agreement are
incorporated herein by reference and made a part of this Agreement to the same
extent as though set forth in full herein; and
WHEREAS, as a condition to the acceptance of the Notes and the making of
the credit facility evidenced by the Credit Agreement (the "Credit Facility"),
Debtor agreed to execute and deliver this Agreement to secure the payment of the
indebtedness from time to time evidenced by the Notes, the payment of all other
sums now or hereafter owing by Debtor hereunder, under the Credit Agreement or
under any other document or instrument now or hereafter evidencing or securing
the aforesaid indebtedness or otherwise executed in connection herewith or
therewith (this Agreement, the Notes, the Credit Agreement and all other
documents and instruments now or hereafter evidencing or securing the aforesaid
indebtedness or otherwise executed in connection herewith or therewith, being
hereinafter referred to collectively as the "Credit Documents"), and the
performance and observance of
all covenants, agreements, conditions and other provisions set forth herein, in
the Notes and in the other Credit Documents;
NOW THEREFORE, and for and in consideration of the sum of Ten and No/100
Dollars ($10.00) paid by Secured Party to Debtor and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Debtor and Secured Party hereby agree as follows:
1. Definitions. Unless otherwise defined in this Agreement, each
-----------
capitalized term shall have the meaning given to such term in the Credit
Agreement. Any terms used in this Security Agreement that are defined in the
Texas Business and Commerce Code ("UCC") shall have the meaning assigned to
those terms by the UCC, whether specified elsewhere in this Security Agreement
or not.
2. Assignment. To secure the payment of this indebtedness from time to
----------
time evidenced by the Notes, the payment of all other sums now or hereafter
owing by the Debtor hereunder, under the Credit Agreement or any other Credit
Document and the performance and observance of all covenants, agreements,
conditions and other provisions set forth herein in the Notes, the Credit
Agreement or any other Credit Document (collectively the "Obligations"), and to
charge the properties, interests and rights hereinafter described with such
payment, performance and observance, Debtor hereby assigns as security to
Secured Party, and hereby grants to Secured Party, a continuing security
interest in the following and Debtor's right, title and interest in, to and
under the following (collectively, the "Collateral"):
a. Equipment. All equipment and vehicles of every kind and
---------
description (collectively herein called the "Equipment");
b. Accounts. All accounts and all rights to payment owing or to be
--------
owing to Debtor, wherever the records for such accounts and rights to
payment are held, including all instruments and chattel paper, wherever
located, that represent (i) any right of Debtor to payment for services
rendered, whether or not it has been earned by performance, or (ii) any
right of Debtor to repayment on account of a loan or intercompany advance
of funds made by Debtor to any Person, whether or not evidenced by a
promissory note (all such accounts, instruments, and chattel paper being
the "Accounts");
c. General Intangibles. All general intangibles relating to, or
-------------------
existing in connection with, any Hotel Property or the other Collateral
(all such general intangibles being "General Intangibles");
d. Bank Accounts. The bank accounts of Borrower and the undersigned
-------------
described on Exhibit "A" attached hereto held with the Secured Party and
all Liquid Investments held in such accounts;
-2-
e. Records. All ledger sheets, files, records, and documents
-------
relating to the Hotel Properties and the foregoing Collateral; and
f. Proceeds. All proceeds of the foregoing Collateral and, to the
--------
extent not otherwise included, all payments under any insurance, indemnity,
warranty, or guaranty of or for the foregoing Collateral.
3. Power and Authority. Debtor has full power and authority to make this
-------------------
agreement.
4. Obligations and This Agreement. Debtor shall perform promptly all
------------------------------
agreements herein, in the Note, and in the other Credit Documents to which they
are a party. Debtor agrees that any amounts paid to Secured Party pursuant to
this Agreement shall be applied in accordance with the provisions of the Credit
Agreement.
5. Ownership of Collateral. At the time Debtor assigns and grants to
-----------------------
Secured Party a security interest in any Collateral, Debtor shall be the
absolute owner thereof and shall have the right to assign and grant such
security interest. Debtor shall defend the Collateral against all claims and
demands of all persons at any time claiming any interest therein adverse to
Secured Party. Debtor shall keep the Collateral free from all liens and security
interests except those for taxes not yet due and the security interest hereby
created.
6. Delivery of Collateral. Debtor covenants and warrants that Debtor, if
----------------------
requested by Secured Party, will provide to Secured Party, a current, true and
complete copy of the Collateral or list of the Collateral, as applicable, until
Debtor satisfies the Obligations in full.
7. Events of Default. An "Event of Default" under the Credit Agreement
-----------------
shall be deemed an Event of Default hereunder ("Event of default").
8. Remedies of Secured Party. When an Event of Default occurs, at any
-------------------------
time thereafter during the continuance of the Default, Secured Party, without
notice, may take all actions permitted under the Credit Documents and exercise
any rights under the Uniform Commercial Code of the State of Texas (the "Uniform
Commercial Code"), rights and remedies of Secured Party under this Agreement, or
otherwise. Secured party may require Debtor to assemble the Collateral and make
it available to Secured Party at a place which is reasonably convenient to both
parties. Unless the Collateral threatens to decline quickly in value or is of a
type customarily sold on a recognized market, Secured Party will give Debtor
reasonable notice of the time and place of any public sale thereof or of the
time after which any private sale or other intended disposition thereof is to be
made. Expenses of retaking, holding, preparing for sale, selling, leasing or the
like shall include Secured Party's reasonable attorney's fees and legal
expenses. Secured Party shall have the authority to enter upon any premises upon
which any of the same, or any Collateral, may be situated and remove the same
therefrom without liability. Debtor shall be entitled to any surplus and shall
-3-
be liable to Secured Party for any deficiency. The proceeds of any disposition
after default available to satisfy the Obligations shall be applied to the
Obligations in such order and in such manner as Secured Party in its discretion
shall decide.
9. Attorney-in-Fact. Debtor hereby irrevocably appoints Secured Party,
----------------
and any officer or agent of Secured Party as Secured Party may select in its
sole discretion, as Debtor's true and lawful attorney-in-fact, with full power
of substitution (a) from and after the occurrence and during the continuance of
an Event of Default, to (i) endorse Debtor's name on all applications,
documents, paper and instruments necessary or desirable for Secured Party in the
use of the Collateral or (ii) take any other actions with respect to the
Collateral as Secured Party deems in the best interest of Secured Party, and (b)
from and after the occurrence and during the continuance of an Event of Default,
to assign, pledge, convey or otherwise transfer title in or dispose of the
Collateral to anyone. Debtor hereby ratifies all that such attorney shall
lawfully do or cause to be done by virtue hereof. This power of attorney is
coupled with an interest and shall be irrevocable until the Obligations shall
have been paid in full and discharged or the security interests granted to
Debtor by this Security Agreement have been released.
10. Rights Cumulative. All of Secured Party's rights and remedies with
-----------------
respect to the Collateral, whether established by this Agreement, by the Notes,
by any other Credit Documents, or by law shall be cumulative and may be
exercised singularly or concurrently. Debtor acknowledges and agrees that this
Agreement is not intended to limit or restrict in any way the rights and
remedies of Secured Party under the Notes or any other Credit Document, but
rather is intended to facilitate the exercise of such rights and remedies.
Secured Party shall have, in addition to all other rights and remedies given to
it by terms of this Agreement, all rights and remedies allowed by law and the
rights and remedies of a secured party under the Uniform Commercial Code as
enacted in any jurisdiction in which the Collateral or Debtor may be located.
11. Additional Documents. Debtor shall sign any papers furnished by
--------------------
Secured Party which are necessary or desirable in the judgment of Secured Party
to obtain, maintain and perfect the security interest hereunder and to enable
Secured Party to comply with any federal or state law in order to obtain or
perfect Secured Party's interest in the Collateral or to obtain proceeds of the
Collateral.
12. Amendments, Etc. No amendment or waiver of any provision of this
---------------
Agreement nor consent to any departure by Debtor from this Agreement, shall be
effective unless the same is in writing and signed by Secured Party, and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.
13. Governing Law. This Agreement shall be governed by and construed and
-------------
enforced in accordance with the laws of the State of Texas and the relevant laws
of the United States of America.
-4-
14. Recordation and Filing. Secured Party shall have the continuing right
----------------------
to record or file a copy of this Agreement in any public records that Secured
Party desires.
15. Subordination. Debtor has subordinated and does hereby subordinate
-------------
all of its rights, liens and security interests in and to the Collateral to the
following: (i) the Credit Documents; (ii) all renewals, substitutions,
extensions, modifications, replacements or amendments of the Credit Documents;
and (iii) the Obligations and all other indebtedness secured by the Credit
Documents and all advances thereunder.
16. Credit Agreement. To the extent that any of the terms or provisions
----------------
of this Agreement are inconsistent with the terms or provisions of the Credit
Agreement, the terms and provisions of the Credit Agreement shall control.
-5-
17. Complete Agreement. THIS WRITTEN AGREEMENT, THE NOTES AND ALL OTHER
------------------
CREDIT DOCUMENTS ENTERED INTO BETWEEN THE PARTIES REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL
AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, Debtor has caused this Agreement to be duly executed as
of the date first set forth above.
DEBTOR:
AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P.
By: AGH GP, Inc., its general partner
By:______________________________
Name:____________________________
Title:___________________________
AGH UPREIT, LLC, a Delaware limited liability
company
By: American General Hospitality Corporation,
member
By:______________________________
Name:____________________________
Title:___________________________
-6-
3100 GLENDALE JOINT VENTURE.
an Ohio general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:______________________
Name:____________________
Title:___________________
BY: American General Hospitality Operating
Partnership, L.P., member
BY: AGHGP Inc., its general partner,
By:______________________
Name:____________________
Title:___________________
BY: American General Hospitality Operating
Partnership, L.P., general partner
BY: AGH GP, Inc., general partner,
By:______________________
Name:____________________
Title:___________________
-7-
MDV LIMITED PARTNERSHIP
a Texas limited partnership
BY: AGH UPREIT, LLC, its general partner
BY: American General Hospitality
Corporation, member
By:______________________
Name:____________________
Title:___________________
By: American General Hospitality Operating
Partnership, L.P., member
BY: AGH ▇▇.▇▇▇., general partner
By:______________________
Name:____________________
Title:___________________
-9-
MADISON MOTEL ASSOCIATES
a Wisconsin general partnership
By: AGH UPREIT, LLC, its partner
By: American General Hospitality
Corporation, member
By:
Name:
Title:
By: American General Hospitality
Operating Partnership, L.P., its
partner
By: AGH GP, Inc., general
partner
By:
Name:
Title:
By: American General Hospitality Operating
Partnership, L.P., member
By: AGH GP, Inc., its general
partner
By:
Name:
Title:
-10-
183 HOTEL ASSOCIATES, LTD.,
a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:
Name:
Title:
By: American General Hospitality
Operating Partnership, L.P.,
member
By: AGH GP, Inc.,
general partner
By:
Name:
Title:
-▇▇-
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ASSOCIATES,
LTD., a Texas limited partnership
By: AGH UPREIT LLC, its general partner
By: American General Hospitality
Corporation, member
By:
Name:
Title:
By: American General Hospitality
Operating Partnership, L.P.,
member
By: AGH GP, Inc.,
general partner
By:
Name:
Title:
-12-
2929 ▇▇▇▇▇▇▇▇ LIMITED LIABILITY COMPANY,
a Delaware limited liability company
By: AGH UPREIT, LLC
By: American General Hospitality
Corporation, member
By:
Name:
Title:
By: American General Hospitality
Operating Partnership, L.P.,
member
By: AGH GP, Inc., general
partner
By:
Name:
Title:
By: American General Hospitality Operating
Partnership, L.P., its member
By: AGH GP, Inc., general partner
By:
Name:
Title:
AGH GP, INC., its general partner
By:_______________________________________
Name:_____________________________________
Title:____________________________________
SECURED PARTY
-▇▇-
▇▇▇▇ ▇▇▇, ▇▇▇▇▇, N.A.
By:____________________
Name:__________________
Title:_________________
-14-
---------------------------COMPARISON OF FOOTERS--------------------------------
-FOOTER 1-
-1-
-FOOTER 2-
LOCADW\78305\006471
DALLAS\53118.2
7/17/96--9:52 pm
-15-
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differences between -
original document :I:\DOCSOPEN\LOCADW\0053118.01
and revised document: I:\DOCSOPEN\LOCADW\0053118.02
CompareRite found 21 change(s) in the text
CompareRite found 2 change(s) in the notes
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-16-
EXHIBIT "DD"
[LETTERHEAD OF BATTLE ▇▇▇▇▇▇ LLP]
July 31, 1996
Societe General
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 4th Floor
Commercial Real Estate Department Lending
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Re: Credit Facility (the "Credit Facility") of up to $100 million to
American General Hospitality Operating Partnership, L.P., a
Delaware limited partnership (the "Borrower") pursuant to a
Credit Agreement (the "Credit Agreement") by and between the
Borrower and Societe Generale, a French banking corporation
acting through its Southwest Agency, as Structuring Agent (the
"Structuring Agent"); Bank One, Texas, N.A., as Administrative
Agent (the "Administrative Agent"); and the banks and other
financial institutions party thereto (collectively referred to
herein as the "Banks")
-----------------------------------------------------------------
Ladies and Gentlemen:
We have acted as counsel to the Borrower, in connection with the
Credit Facility. This opinion is being furnished pursuant to Section 3.01 of the
Credit Agreement. Capitalized terms used herein and not defined herein shall
have the meanings ascribed to such terms in the Credit Agreement.
BATTLE ▇▇▇▇▇▇ LLP PAGE 2
In connection with this option, we have examined the following
materials:
(a) the Credit Agreement and the documents executed and delivered in
connection therewith identified on Schedule I hereto (collectively referred to
herein as the "Credit Documents");
(b) the certificate of limited partnership, as amended (the
"Partnership Certificate"), of the Borrower, as certified by the Secretary of
State of Delaware, as being as a true and correct copy of such document as filed
in the office of the Secretary of State;
(c) the amended and restated articles of incorporation (the
"Charter") of American General Hospitality Corporation (the "Company"), as
certified by the State Department of Assessments and Taxation of the State of
Maryland as being a true and complete copy of such document as filed in the
office of the State Department of Assessments and Taxation (the "SDAT");
(d) the amended and restated agreement of limited partnership (the
"Operating Partnership Agreement") of the Borrower, dated as of July ___, 1996,
as certified by the Secretary of AGH GP, Inc., a Nevada corporation ("AGH GP"),
as general partner of the Borrower, on the date hereof as being complete,
correct and in effect;
(e) the partnership agreement, as amended, of each partnership other
than the Borrower (collectively, the "Partnership Subsidiaries") that are
identified as a Property in Partnership in Schedule II hereto, in each case, as
certified by a general partner of such partnership as of the date hereof as
being complete, correct and in effect;
(f) the operating agreement, as amended, and the certificate of
formation, as amended, of each of the limited liability companies identified on
Schedule II hereto (the "LLC Subsidiaries" and together with the Partnership
Subsidiaries the "Subsidiaries") as certified by an official of the office of
the jurisdictions of formation in which such certificate of formation is filed
on the date indicated on such certificate as being a true and complete copy of
such document as filed in such office;
(g) the Bylaws of the Company as certified by the Secretary of the
Company and as the case may be, as of the date hereof as being complete, correct
and in effect;
(h) certificates of good standing issued by the States of Formation
of the Borrower, the Company and the Subsidiaries;
BATTLE ▇▇▇▇▇▇ LLP PAGE 3
(i) resolutions of the members of AGH UPREIT LLC, and resolution of
AGH UPREIT LLC, as certified by the members of AGH UPREIT LLC as of the date
hereof as being complete, correct and the effect;
(j) a certificate of the Secretary of the Company and each Corporate
Subsidiary, dated as of the date hereof, as to the incumbency and signatures of
certain officers of the Company or such Corporate Subsidiary;
(k) an executed copy of each of the Credit Documents; and
(l) the other instruments and documents delivered at today's closing,
including certificates or telegrams of public officials as to matters set forth
therein and certificates of representatives of the Borrower as to matters set
forth therein.
In rendering this opinion, we have assumed the capacity to sign and
the genuineness of all signatures of all persons executing agreements,
instruments or documents examined or relied upon by us, the authenticity of all
agreements, instruments or documents submitted to us as originals and the
conformity with the original agreements, instruments or documents of all
agreements, instruments or documents submitted to us as copies.
We have also assumed that as to all parties other than the Borrower,
the Company and the Subsidiaries, the due authorization, execution,
acknowledgement as indicated thereon and delivery of documents referred to
herein, and the validity, binding effect and enforceability thereof against all
parties thereto other than the Borrower, the Company, AGH GP, and the
Subsidiaries and that each of the Banks has full power, authority and legal
right, under its charter and other governing documents and all applicable laws
to execute, deliver and perform their respective obligations under the Credit
Agreement and the other documents referred to therein and herein to which it is
a party.
With respect to matters of fact, we have relied upon the written
statements and certificates of officers of AGH GP (on behalf of the Borrower),
and authorized representatives of the LLC Susidiaries and the general partners
of the Partnership Subsidiaries (including, without limitation, the certificate
attached hereto as Exhibit A, referred to herein as the "Officers Certificate"),
---------
representations made by the Borrower in the Credit Agreement, and certificates
of public officials. Where matters are stated to be "to the best of our
knowledge" or "known to us," our knowledge is limited to the actual knowledge of
those attorneys in our office who have directly participated in this engagement,
their
BATTLE ▇▇▇▇▇▇ LLP PAGE 4
review of documents provided to us by the Borrower, the Company and the
Subsidiaries in connection with this engagement and inquiries of officers of AGH
GP and the Company, the results of which are reflected in the Officers
Certificate. We have not independently verified the accuracy of the matters set
forth in the written statements or certificates upon which we have relied,
including the organization, existence, good standing, assets, business or
affairs of the Borrower, the Company, or any Subsidiary.
Insofar as our opinion relates to (i) matters of Maryland law, we have
relied upon the opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ addressed to us,
dated the date hereof, a copy of which is attached hereto as Exhibit B.
---------
Insofar as our opinion relates to matters of Ohio, Wisconsin, Texas or
Nevada law, we have relied exclusively upon the opinions of McDonald, Hopkins,
▇▇▇▇▇ & ▇▇▇▇▇▇ Co., ▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇ and ▇▇▇▇▇▇▇▇
Carano ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP. A copy of each such opinion
is attached hereto as Exhibit C, Exhibit D, Exhibit E and Exhibit F.
--------- --------- --------- ---------
We are not admitted to practice law in any jurisdiction other than the
State of New York and we do not express any opinion as to the laws of any states
or jurisdictions except as to New York law, the Delaware General Corporation
Law, the Delaware Revised Uniform Limited Partnership Act, the Delaware Limited
Liability Company Act and the Federal law of the United States of America.
Upon the basis of and subject to the foregoing and solely in reliance
thereon, we are of the opinion that:
1. Each of the Borrower and the Subsidiaries, is a limited
partnership, general partnership or limited liability company duly incorporated
or formed, as the case may be, validly existing and in good standing under the
laws of its jurisdiction of incorporation or formation with full corporate,
partnership or limited liability company power and authority to own, lease and
operate its properties and to conduct its business and to execute and perform
their respective obligations under the Credit Documents to which they are a
party.
2. The execution and delivery of, and the performance by the
Borrower and the Subsidiaries of their respective obligations under the Credit
Documents have been duly and validly authorized.
BATTLE ▇▇▇▇▇▇ LLP PAGE 5
3. Each of the Credit Documents has been duly executed and delivered
by the parties thereto.
This opinion is being rendered to you and the other Banks and the
Bank's respective counsel for your and their sole use and may not be made
available to or relied upon by any other person, firm or entity without our
express prior written consent except for future Banks or participants in the
Credit Facility.
Very truly yours,
SCHEDULE I
----------
CREDIT DOCUMENTS
----------------
A. GENERAL DOCUMENTS
4. Credit Agreement, between American General Hospital Operating
Partnership, L.P. (the "OP"), Bank One, Texas, N.A. ("Bank One"),
Societe Generale ("SG") and the banks;
5. Manager's Consent and Agreement by American General Hospitality Inc.
(the "Manager") and AGH Leasing ("Lessee") in favor of Bank One, SG
and the banks;
6. Environmental Indemnification Agreement by American General
Hospitality Corporation ("AGHC"), AGH UPREIT LLC ("AGH UPREIT") and
each of the Property Ownership Entities in favor of Bank One, SG and
the banks;
7. Guaranty and Contribution Agreement by American General Hospitality
Corporation ("AGHC"), AGH UPREIT, and each of the Property-Owning
Entities;
8. Note(s) in the aggregate amount of $100,000,000 executed by the OP in
favor of Bank One, SG and the Banks;
9. Security Agreement to be executed by the OP in favor of Bank One and
each of the Property Owning Entities;
10. Letter Agreement regarding cash management between the OP, the
property Owning Entities and Bank One;
B. ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
12. Pledge Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇ in favor of Lessee;
13. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of Borrower;
14. Assignment of Management Agreements by Lessee in favor of Borrower;
15. General Assignment and Agreement by Lessee in favor of Borrower;
16. Collateral Assignment and Security Agreement by Borrower in favor of
Bank One;
17. Liquor License Company Consent and Agreement between Lessee and SJBMI
in favor of Bank One, SG and the banks;
2
18. Assignment of Lease and Rents between Borrower and Bank One;
19. Deed of Trust, Security Agreement, Assignment of Rents and Financing
Statement by Borrower for the benefit of Bank One;
20. Depository Account Agreement between Lessee, Owner and the local bank;
21. Depository Account Agreement between Lessee, Borrower and Bank One;
22. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
23. Irrevocable direction letter to pay by Borrower to Lessee.
C. HOLIDAY INN MISSION VALLEY, SAN DIEGO
24. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
25. Pledge Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇ in favor of Lessee;
26. Assignment of Leases, Rents and Security Deposits, between Lessee in
favor of Borrower;
27. Assignment of Management Agreements between Lessee in favor of
Borrower;
28. General Assignment and Agreement by Lessee and in favor of Borrower;
29. Collateral Assignment and Security Agreement, which by Borrower in
favor of Bank One;
30. Liquor License Company Consent and Agreement by Lessee and SDBMI in
favor of Bank One, SG and the banks;
31. Assignment of Leases and Rents between Borrower and Bank One;
32. Deed of Trust, Security Agreement, Assignment of Rents and Financing
Statement by Borrower for the benefit of Bank One;
3
33. Depository Account Agreement between Lessee, Owner and the local bank;
34. Depository Account Agreement between Lessee, Owner and Bank One;
35. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
36. Irrevocable direction letter to pay by Owner to Lessee.
D. DAYS INN OCEAN CITY
37. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
38. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of Borrower;
39. Assignment of Management Agreements by Lessee in favor of Borrower;
40. General Assignment and Agreement by Lessee in favor of borrower;
41. Collateral Assignment and Security Agreement by Borrower in favor of
Bank One;
42. Assignment of Leases and Rents between Borrower and Bank One;
43. Deed of Trust, Security Agreement, Assignment of Rents and Financing
Statement by Borrower in favor of Bank One;
44. Depository Account Agreement between Lessee, Owner and the local bank;
45. Depository Account Agreement between Lessee, Owner and Bank One;
46. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
47. Irrevocable direction letter to pay by Owner to Lessee.
▇. ▇▇ ▇▇▇▇▇ AIRPORT HOTEL
48. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
49. Pledge Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇ and Lessee;
50. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of Borrower;
51. Assignment of Management Agreements by Lessee in favor of Borrower;
52. General Assignment and Agreement by Lessee and in favor of Borrower;
53. Collateral Assignment and Security Agreement by Borrower in favor of
Bank One;
54. Liquor License Company Consent and Agreement by Lessee and LBBMI in
favor of Bank One, SG and the banks;
55. Assignment of Leases and Rents by Lessor in favor of Bank One;
56. Deed of Trust, Security Agreement, Assignment of Rents and Financing
Statement by Borrower for the benefit of Bank One;
57. Depository Account Agreement between Lessee, Owner and the local bank;
58. Depository Account Agreement between Lessee, Owner and Bank One;
59. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
60. Irrevocable direction letter to pay by Owner to Lessee.
F. ▇▇▇▇ ▇▇▇▇▇▇ ALBUQUERQUE HOTEL
61. Lessee Estoppel Acknowledgment and Subordination Agreement, executed
by Lessee in favor of Bank One, SG and the banks;
62. Pledge Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇ and Lessee;
63. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of Borrower;
64. Assignment of Management Agreements by Lessee in favor of Borrower;
65. General Assignment and Agreement by Lessee in favor of Borrower;
66. Collateral Assignment and Security Agreement by Borrower in favor of
Bank One;
67. Liquor License Company Consent and Agreement by Lessee and
[Albuquerque Beverage Management, Inc.] in favor of Bank One, SG and
the banks;
68. Assignment of Leases and Rents by Lessor in favor of Bank One;
69. Deed of Trust, Security Agreement, Assignment of Rents and Financing
Statement by Borrower for the benefit of Bank One;
70. Depository Account Agreement between Lessee, Owner and the local bank;
71. Depository Account Agreement between Lessee, Owner and Bank One.
72. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
73. Irrevocable direction letter to pay by Owner to Lessee.
G. HOLIDAY INN NEW ORLEANS AIRPORT
74. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
75. Pledge Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇ and Lessee;
76. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of 2929 ▇▇▇▇▇▇▇▇ Limited Liability Company;
77. Assignment of Management Agreements by Lessee in favor of Owner
("Owner");
78. General Assignment and Agreement by Lessee in favor or Owner;
79. Collateral Assignment and Security Agreement by Owner in favor of Bank
One;
6
80. Liquor License Company Consent and Agreement by Lessee and [Kenner
Beverage Management, Inc.] in favor of Bank One, SG and the banks;
81. Assignment of Leases and Rents by Owner in favor of Bank One;
82. Mortgage, Security Agreement, Assignment of Rents and Financing
Statement by Owner in favor of Bank One;
83. Depository Account Agreement between Lessee, Owner and the local bank;
84. Depository Account Agreement between Lessee, Owner and Bank One;
85. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
86. Irrevocable direction letter to pay by Owner to Lessee.
▇. ▇▇▇▇▇▇ HOTEL - TOLEDO
87. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
88. Pledge Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇ and Lessee;
89. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of 3100 Glendale Joint Venture ("Owner");
90. Assignment of Management Agreements by Lessee in favor of Owner;
91. General Assignment and Agreement by Lessee in favor of the Owner;
92. Collateral Assignment and Security Agreement by Owner in favor of Bank
One;
93. Liquor License Company Consent and Agreement by Lessee and [Ohio
Beverage Management, Inc.] in favor of Bank One, SG and the banks;
94. Assignment of Leases and Rents by Owner in favor of Bank One;
7
95. Mortgage, Security Agreement, Assignment of Rents and Financing
Statement to be signed by Owner in favor of Bank One;
96. Depository Account Agreement between Lessee, Owner and the local bank;
97. Depository Account Agreement between Lessee, Owner and Bank One;
98. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
99. Irrevocable direction letter to pay by Owner to Lessee.
I. HOTEL MAISON DE VILLE
100. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
101. Pledge Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇ in favor of Lessee;
102. Assignment of Leases, Rent and Security Deposits by Lessee in favor of
the MDV Limited Partnership ("Owner");
103. Assignment of Management Agreements by Lessee in favor of the Owner;
104. General Assignment and Agreement by Lessee in favor of Owner;
105. Collateral Assignment and Security Agreement by Owner in favor of Bank
One;
106. Liquor License Company Consent and Agreement by Lessee and [American
General Hospitality of Louisiana] in favor of Bank One, SG and the
banks;
107. Assignment of Leases and Rents by Owner in favor of Bank One;
108. Mortgage, Security Agreement, Assignment of Rents and Financing
Statement to be signed by MDV Limited Partnership in favor of Bank
One;
109. Depository Account Agreement between Lessee, Owner and the local bank;
8
110. Depository Account Agreement between Lessee, Owner and Bank One;
111. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
112. Irrevocable direction letter to pay by Owner to Lessee.
J. HOLIDAY INN SELECT - MADISON
113. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
114. Pledge Agreement, executed by ▇▇▇▇▇ ▇▇▇▇▇ in favor of Lessee;
115. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of the Madison Motel Associates ("Owner");
116. Assignment of Management Agreements by Lessee in favor of Owner;
117. General Assignment and Agreement by Lessee in favor of Owner;
118. Collateral Assignment and Security Agreement by Owner in favor of
Bank One;
119. Liquor License Company Consent and Agreement by Lessee and [Madison
Lounge Incorporated] in favor of Bank One, SG and the banks;
120. Assignment of Leases and Rents by Lessor in favor of Lender;
121. Mortgage, Security Agreement, Assignment of Rents and Financing
Statement by Owner in favor of Bank One.
122. Depository Account Agreement between Lessee, Owner and the local bank;
123. Depository Account Agreement between Lessee, Owner and Bank One;
124. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
125. Irrevocable direction letter to pay by Owner to Lessee.
9
K. HOLIDAY INN DALLAS DFW WEST
126. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
127. Pledge Agreement by ▇▇▇▇▇ ▇. ▇▇▇▇▇ in favor of Lessee;
128. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of 183 Hotel Associates, Ltd ("Owner');
129. Assignment of Management Agreements by Lessee in favor of the Owner;
130. General Assignment and Agreement by Lessee in favor of Owner;
131. Collateral Assignment and Security Agreement by each Owner in favor of
Bank One;
132. Liquor License Company Consent and Agreement by Lessee and [Elf
Management, Inc.] in favor of Bank One, SG and the banks;
133. Assignment of Leases and Rents by Owner in favor of Bank One;
134. Deed of Trust, Security Agreement, Assignment of Rents and Financing
Statement by 183 Hotel Associates, Ltd. in favor of Bank One;
135. Depository Account Agreement between Lessee, Owner and the local bank;
136. Depository Account Agreement between Lessee, Owner and Bank One;
137. Credit Card Receivables direction letter by Lessee to the Credit Card
Companies;
138. Irrevocable direction letter to pay by Owner to Lessee.
▇. ▇▇▇▇▇▇▇ INN RICHMOND AIRPORT
139. Lessee Estoppel Acknowledgment and Subordination Agreement by Lessee
in favor of Bank One, SG and the banks;
140. Assignment of Leases, Rents and Security Deposits by Lessee in favor
of Richmond Williamsburg Associates, Ltd. ("Owner");
141. Assignment of Management Agreements by Lessee in favor of Owner;
142. General Assignment and Agreement by Lessee in favor of Owner
143. Collateral Assignment and Security Agreement, executed by Owner in
favor of Bank One;
144. Assignment of Leases and Rents by Owner in favor of Bank One;
145. Deed of Trust, Security Agreement, Assignment of Rents and Financing
Statement by Owner in favor of Bank One;
146. Depository Account Agreement between Lessee, Owner and the local bank;
147. Depository Account Agreement between Lessee, Owner and Bank One;
148. Credit Card Receivables direction letter by Lessee to the Credit Card
Compaines;
149. Irrevocable direction letter to pay by Owner to Lessee.
Schedule II
-----------
ENTITY STATE OF FORMATION
------ -------------------
LLC Subsidiaries
----------------
AGH UPREIT LLC Delaware
2929 ▇▇▇▇▇▇▇▇ Limited Delaware
Liability Company
Partnership Subsidiaries
------------------------
3100 Glendale Joint Ohio
Venture (Ohio General Partnership)
MDV Limited Partnership (Texas limited partnership) Texas
Madison Motel Associates (Wisconsin general partnership) Wisconsin
183 Hotel Associates, Ltd. (Texas limited partnership) Texas
Richmond Williamsburg Associates, Ltd. (Texas limited Texas
partnership)
Exhibit A
---------
OFFICERS CERTIFICATE
Exhibit B
---------
[Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & Ingersoll]
Exhibit C
---------
[Opinion of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇ Co. related to matters of Ohio law]
Exhibit D
---------
[Opinion of ▇▇▇▇▇ & Lardner related to matters of Winconsin law]
Exhibit E
---------
[Opinion of ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇ related to matters of Texas law]
[LETTERHEAD OF BATTLE ▇▇▇▇▇▇ LLP]
July ____, 1996
Societe Generale
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Re: Credit Facility (the "Credit Facility") of up to $100 million to
American General Hospitality Operating Partnership, L.P., a
Delaware limited partnership (the "Borrower") pursuant to a
Credit Agreement (the "Credit Agreement") by and between the
Borrower and Societe Generale, a French banking corporation
acting through its Southwest Agency, as Structuring Agent (the
"Structuring Agent"); Bank One, Texas, N.A., as Administrative
Agent (the "Administrative Agent"); and the banks and other
financial institutions party thereto (collectively referred to
herein as the "Banks")
----------------------------------------------------------------
Ladies and Gentlemen:
We have acted as counsel to AGH Leasing, L.P., a Delaware limited
partnership, in connection with the Credit Facility. This opinion is being
furnished pursuant to section 3.01 of the Credit Agreement. Capitalized terms
used herein and not defined herein shall have the meanings ascribed to such
terms in the Credit Agreement.
BATTLE ▇▇▇▇▇▇ LLP PAGE 2
In connection with this opinion, we have examined the following
materials:
(a) the documents that Lessee executed and delivered in connection
with the Credit Agreement identified on Schedule I hereto (collectively
referred to herein as the "Lessee Documents");
(b) the certificate of limited partnership, as amended (the
"Partnership Certificate"), of Lessee, as certified by the Secretary of State of
the State of Delaware on July 12, 1996 as being as a true and correct copy of
such document as filed in the office of the Secretary of State;
(c) The Agreement of Limited Partnership of Lessee dated as of the
date hereof and certified by the Secretary of AGHL GP, Inc., a Delaware
corporation ("General Partner"), general partner of Lessee;
(d) the certificate of incorporation of General Partner, as certified
by the Secretary of State of the State of Delaware on May 28, 1996 as being a
true and correct copy of such document as filed in the office of the Secretary
of State;
(e) the Bylaws of General Partner, as certified by he Secretary of
General Partner, as of the date hereof as being complete, correct and in effect;
(f) certificates of good standing issued by the State of Delaware for
Lessee and General Partner;
(g) resolutions of the board of directors of General Partner adopted
by unanimous written consent and dated July 11, 1996, as certified by the
Secretary of such Corporate Subsidiary as of the date hereof as being true and
complete and in effect;
(h) a certificate of the Secretary of General Partner and each
Corporate Subsidiary, dated as of the date hereof, as to the incumbency and
signatures of certain officers of General Partner;
(i) the other instruments and documents delivered at today's closing,
including certificates or telegrams of public officials as to matters set forth
therein and certificates of representatives of the Lessee as to matters set
forth therein.
In rendering this opinion, we have assumed the capacity to sign and
the genuineness of all signatures of all persons executing agreements,
instruments or documents examined or relied upon by us, the authenticity of all
agreements, instruments or documents submitted to us as originals and the
conformity with the original
BATTLE ▇▇▇▇▇▇ LLP PAGE 3
agreements, instruments or documents of all agreements, instruments or documents
submitted to us as copies.
We have also assumed (a) as to all parties other than the Lessee and
General Partner, the due authorization, execution, acknowledgement as indicated
thereon and delivery of documents referred to herein, and the validity, binding
effect and enforceability thereof against all parties thereto other than the
Lessee and General Partner, that each of the Banks has full power, authority and
legal right, under its charter and other governing documents and all applicable
laws to execute, deliver and perform their respective obligations under the
Credit Agreement and the other documents referred to therein and herein to which
it is a party.
With respect to matters of fact, we have relied upon the written
statements and certificate of officers of General Partner (on behalf of the
Lessee), representations made by the Lessee in the Lessee Documents, and
certificates of public officials including, without limitation, the certificate
attached hereto as Exhibit A (the "Certificate"). Where matters are stated to be
---------
"to the best of our knowledge" or "known to us," our knowledge is limited to the
actual knowledge of the those attorneys in our office who have directly
participated in this engagement, their review of documents provided to Lessee
and General Partner in connection with this engagement and inquiries of officers
of General Partner the results of which are reflected in the Officers
Certificate. We have not independently verified the accuracy of the matters set
forth in the written statements or certificates upon which we have relied,
including the organization, existence, good standing, assets, business or
affairs of the Lessee or General Partner.
Except for the opinions set forth in paragraphs (1) through (4) below,
we express no opinions and no opinions should be implied.
We are not admitted to practice law in any jurisdiction other than the
State of New York and we do not express any opinion as to the laws of any states
of jurisdictions except as to New York law, the Delaware General Corporation
Law, the Delaware Revised Uniform Limited Partnership Act, the Delaware Limited
Liability Company Act and the Federal law of the United States of America.
Upon the basis of and subject to the foregoing and solely in reliance
thereon, we are of the opinion that:
BATTLE ▇▇▇▇▇▇ LLP PAGE 4
its properties and to conduct its business and to execute and perform their
respective obligations under the Lessee Documents.
2. General Partner is a corporation duly incorporated and validly
existing under and by virtue of the laws of the State of Delaware and is in good
standing with the Secretary of State of Delaware, with full corporate power to
own, lease and operate its properties and to conduct its business and to
execute and perform the obligations on behalf of Lessee under the Lessee
Documents.
3. The execution and delivery of, and the performance by the Lessee
of its respective obligations under, the Lessee Documents have been duly and
validly authorized.
4. Each of the Lessee Documents has been duly executed and delivered
by Lessee.
This opinion is being rendered to you and the other Banks and the
Bank's respective counsel for your and their sole use and may not be made
available to or relied upon by any other person, firm or entity without our
express prior written consent, except for future Banks or participants in the
Credit Facility.
Very truly yours,
EXHIBIT "EE"
[LETTERHEAD OF KANE, RUSSELL, ▇▇▇▇▇▇▇ & ▇▇▇▇▇]
July 31, 1996
Societe Generale,
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Lending
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Re: Credit Facility (the "Credit Facility") of up to
$100,000,000.00 to AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P., a Delaware limited
partnership (the "Borrower") pursuant to a Credit
Agreement (the "Credit Agreement") by and among the
Borrower; SOCIETE GENERALE, a French banking
corporation acting through its Southwest Agency, as
Structuring Agent (the "Structuring Agent"); BANK ONE,
TEXAS, N.A., as Administrative Agent (the
"Administrative Agent"); and the banks and other
financial institution party thereto (collectively
referred to herein as the "Banks").
Gentlemen:
In connection with the Credit Facility, we have acted as special Texas
counsel to Borrower. American General Hospitality Corporation, a Maryland
corporation ("AGHC"), and 183 Hotel Associates, Ltd., a Texas limited
partnership ("Mortgagor") as well as MDV Limited Partnership, a Texas limited
partnership, ("MDV") and Richmond Williamsburg Associates, Ltd., a Texas limited
partnership ("RW") (Mortgagor, MDV and RW are collectively referred to herein as
the "Partnerships"), and American General Hospitality, Inc., a Texas corporation
("▇▇▇▇"). The Credit Facility is evidenced, in part, by certain promissory notes
(the "Notes") executed by the Borrower and payable to the Banks, the Credit
Agreement, the documents described below and the other documents executed in
connection with the Credit Facility
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 2
(collectively, the "Credit Documents"). The Mortgagor is leasing certain real
and personal property (collectively, the "Property") to AGH Leasing L.P., a
Delaware limited partnership ("Lessee") pursuant to a lease agreement
(collectively herein, the "Lease") between such parties. The real property is
located in the County of Tarrant (the "County") in the State of Texas (the
"State").
1. DOCUMENTS REVIEWED. For purposes of this opinion (the "Opinion
------------------
Letter"), we have examined the following documents, all of which are dated July
31, 1996, unless otherwise specified:
(a) Deed of Trust, Security Agreement, Assignment of Rents and
Financing Statement (the "Mortgages"), executed by the Mortgagor, securing
payment of the Notes covering each of the Property;
(b) Assignment of Leases, Rents and Security Deposits (the "Mortgagor
Assignment of Leases"), executed by the Mortgagor, further securing payment
of the Notes:
(c) UCC Financing Statements executed by the Mortgagor to be filed in
the real property records (the "Records") of the County and with the
Secretary of State (the "Secretary of State") of the State (respectively,
the "Mortgagor County Financing Statement" and the "Mortgagor State
Financing Statement" and collectively the "Mortgagor Financing
Statements");
(d) Assignment of Leases, Rents and Security Deposits (the "Lessee
Assignment of Leases"), executed by the Lessee in favor of the Mortgagor
securing the Lessee's obligations under the Lease;
(e) UCC Financing Statements executed by the Lessee to be filed in
the Records and with the Secretary of State (respectively, the "Lessee
County Financing Statement" and the "Lessee State Financing Statement" and
collectively the "Lessee Financing Statements").
(f) Credit Agreement;
(g) The Notes;
(h) General Assignments and Agreements ("General Assignments") by and
among the following
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 3
(i) Lessee and Borrower (as to Holiday Inn Park Center Plaza,
Holiday Inn Mission valley, Days Inn Ocean City, and ▇▇▇▇
▇▇▇▇▇▇ Albuquerque Airport Hotel);
(ii) Lessee and 2929 ▇▇▇▇▇▇▇▇ Limited Liability Company,
("2929") a Delaware Limited Liability Company (as to
Holiday Inn New Orleans Airport);
(iii) Lessee and 3100 Glendale Joint Venture, ("3100) an Ohio
joint venture (as to Hilton Hotel-Toledo);
(iv) Lessee and MDV (as to Hotel Maison de Ville);
(v) Lessee and Madison Motel Associates, ("Madison") a
Wisconsin general partnership (as to Holiday Inn Select
Madison);
(vi) Lessee and Mortgagor (as to Holiday Inn DFW Airport West);
and
(vii) Lessee and RW (as to Hampton Inn Richmond Airport).
(i) Collateral Assignment and Security Agreements ("Collateral
Assignments") by and among the following:
(i) Mortgagor and Administrative Agent;
(ii) 2929 and Administrative Agent;
(iii) 3100 and Administrative Agent;
(iv) MDV and Administrative Agent;
(v) Madison and Administrative Agent;
(vi) RW and Administrative Agent; and
(vii) Borrower and Administrative Agent.
(j) Assignments of Management Agreements ("Management Assignments")
by and among the following:
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 4
(i) Lessee and Borrower;
(ii) Lessee and 2929;
(iii) Lessee and 3100;
(iv) Lessee and MDV;
(v) Lessee and Madison;
(vi) Lessee and Mortgagor; and
(vii) Lessee and RW.
(k) Environmental Indemnification Agreement ("Environmental
Indemnity;) by and among Mortgagor, AGHC, Borrower and all of the corporate
and partnership subsidiaries (excepting 455 Meadowlands, Ltd., a Texas
limited partnership and DFW South I Limited Partnership, a Texas limited
partnership) of the Borrower and AGHC, in favor of the Banks.
(l) Guaranty and Contribution Agreement ("Guaranty") by and among
AGHC, AGH Upreit LLC, 3100, MDV, Madison, Mortgagor, RW, and 2929
(collectively, the "Guarantors") in favor of the Banks;
(m) Liquor License Company Consents and Agreements ("Liquor
Consents") by and between Lessee and various corporate entities owned by
▇▇▇▇▇▇ ▇. ▇▇▇▇▇;
(n) Liquor License Company Pledge Agreements ("Liquor Pledges") by
and between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and Lessee;
(o) Security Agreement ("Security Agreement") by and among Borrower,
Banks, AGH Upreit LLC, MDV, Madison, 183, RW, and 2929;
(p) Manage's Consent and Agreement ("Manager's Consent") by and
between ▇▇▇▇ and Lessee; and
(q) Irrevocable Direction to Pay Rent to Lessee from the Borrower,
3100, MDV, Madison, 183, RW, and 2929.
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 5
For purposes of this Opinion Letter, all of the documents described in clauses
(a)-(q) above and executed by the Mortgagor, Lessee, Borrower. Guarantors of
▇▇▇▇ are hereinafter collectively referred to as the "Executed Documents."
In connection with the opinions hereinafter set forth, we have limited the
scope of the review to the Executed Documents. In addition, in connection with
the opinions hereinafter set forth, we have reviewed such other documents and
certificates of public officials and certificates of representatives of Borrower
and Mortgagor, and have given consideration to such matters of law and fact, as
we have deemed appropriate in our professional judgment, to render such
opinions.
2. OPINIONS. Subject to the matters set forth in subsequent portions of
--------
this Opinion Letter, it is our opinion that:
(a) Each of the Executed Documents constitutes the legal, valid and
binding obligation of the parties thereto, enforceable against the parties
thereto in accordance with their terms.
(b) The Mortgages and the Mortgagor County Financing Statement are in
proper form for filing in the Records and the Mortgagor State Financing
Statement is in proper form for filing with the Secretary of State. Upon
the recording of the Mortgages and the Mortgagor County Financing Statement
in the Records, and upon the filing of the Mortgagor State Financing
Statement with the Secretary of State, no other recording, filing or other
action under the laws of the State is required in order to perfect the
liens in the Property, the security interest in the fixtures created
thereby and the security interest in the personalty described therein.
(c) Upon proper filing of the Mortgagor County Financing Statement in
the Records and the Mortgagor State Financing Statement with the Secretary
of State, the "Said Indebtedness" under the Mortgages will be secured by a
validly created, perfected security interest in favor of the Administrative
Agent for the benefit of the Banks in and to all the right, title and
interest of the Mortgagor in and to the collateral described in the
Mortgagor Financing Statements, to the extent such collateral is located in
the State, and upon the proper filing of the Mortgages in the Records, the
"Said Indebtedness" under the Mortgages will be secured by a validly
created, perfected mortgage lien in favor of the Administrative Agent for
the benefit of the Banks in and to all the right, title and interest of the
Mortgagor in and to the real property and fixtures described in the
Mortgages.
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 6
(d) The Lessee County Financing Statement is in proper form for
filing in the Records, and the Lessee State Financing Statement is in
proper form for filing with the Secretary of State. Upon the recording of
the Lessee County Financing Statement in the Records, and upon the filing
of the Lessee State Financing Statement with the Secretary of State, no
other recording, filing or other action under the laws of the State is
required in order to perfect that liens in the property described therein.
(e) Upon proper filing of the Lessee County Financing Statement in
the Records and the Lessee State Financing Statement with the Secretary of
State, the Lessee's obligations under the Lease will be secured by a
validly created, perfected security interest in favor of the Mortgagor in
and to all the right, title and interest of the Lessee in and to the
collateral described in the Lessee Financing Statements, to the extent such
collateral is located in the State.
(f) There are no stamp, recording or similar taxes required to be
paid in connection with the execution, delivery, recording or enforcement
of the Mortgage except for nominal per page recording fees.
(g) The Mortgagor, the Lessee and the Partnerships are each
authorized to do business and are in good standing in the State.
(h) The Partnerships are each duly formed and validly existing under
State law, and all actions or approvals by each of the Partnerships, and
their general partners necessary to bind the Partnerships under the
Executed Documents have been taken or obtained, and each has duly executed
and delivered the Executed Documents.
(i) ▇▇▇▇ is duly formed and validly existing under State law, and has
the requisite corporate power and authority to own its assets and carry out
its business, and all necessary corporate actions have been taken to bind
▇▇▇▇ under the Executed Documents to which it is a party, and ▇▇▇▇ has duly
executed and delivered the applicable Executed Documents.
(j) To the best of our current actual knowledge, no approval,
authorization or other action by any governmental authority of the State,
is required in connection with the execution and delivery of the Executed
Documents by the Mortgagor and/or the Lessee, and the consummation of the
transactions contemplated thereby.
(k) Based on adherence to existing judicial precedents under State
law, a State court would hold that the choice of Texas law to govern the
construction and interpretation of the provisions of the Credit Documents
would be enforceable.
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 7
(l) Assuming that no fees, charges, benefits or other compensation
will be paid, directly or indirectly to you or for your benefit, except as
specified in the Executed Documents and the letter agreement dated June 12,
1996 by and among the Banks, the Borrower and AGHC ("Fee Letter"), and
assuming that no amounts to be paid as specified in the Executed Documents
or the Fee Letter constitute a penalty, the Credit Facility, as evidenced
by the Executed Documents and the Fee Letter does not violate the usury
laws of the State.
3. ASSUMPTIONS. Notwithstanding any provision in this Opinion Letter to
-----------
the contrary, we have assumed, without investigation the following:
(a) CAPACITY. We have assumed the legal capacity of each individual
--------
signing one or more of the Executed Documents or other documentation upon
which this Opinion Letter has been based.
(b) BANKS' AUTHORITY. The Banks are authorized to make the Credit
----------------
Facility in accordance with the Credit Documents. The Executed Documents,
and the transactions evidenced thereby, are valid, binding and enforceable
with regard to the Banks and/or any other parties executing the Executed
Documents other that the Mortgagor and the Lessee.
(c) OTHER PARTIES' AUTHORITY. Except for the Partnerships and ▇▇▇▇.
------------------------
Each of the other parties to any of the Executed Documents are each duly
formed, are validly existing, and are authorized to do business and in good
standing under the laws of their respective states of creation, are
authorized to do business in Texas and each has the requisite
organizational power and authority to own its assets, transact the business
in which it will be engaged in connection with the Credit Facility, to
execute and deliver the Executed Documents in the capacity therein stated,
and to perform its obligations under the Executed Documents.
(d) GENUINENESS AND AUTHENTICITY. All signatures appearing on all
----------------------------
Executed Documents are genuine; all documents and records submitted to us
as originals are authentic; all documents and records submitted to us as
copies conform to the corresponding original documents and records; and all
statements of fact therein are true.
(e) CONTACTS. Substantial negotiations for the Credit Facility and
---------
the closing of the Credit Facility occurred in Texas. The Structuring
Agent's and the Borrower's and Lessee's principal place of business is in
Texas. The Credit Facility will be funded out of New York. Repayments
under the Credit Facility will be made in Texas.
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 8
(f) NO MUTUAL MISTAKE. There has not been any mutual mistake of fact
------------------
or misunderstanding, fraud, duress or undue influence
(g) GOOD FAITH. The conduct of the parties to the Credit Facility
-----------
has complied with any requirement of good faith, fair dealing and
conscionability.
(h) NO UNDERSTANDINGS. There are no agreements or understandings
------------------
among the parties, written or oral, and there is no usage of trade or
course of prior dealing among the parties that would, in either case,
define, supplement or qualify the terms of the Executed Documents.
(i) COLLATERAL DESCRIPTION. The description of the collateral in the
-----------------------
Security Documents is accurate.
(j) USURY. We have assumed with your consent, for purposes of
------
applying State usury laws, that the Banks, Borrower, Mortgagor and any
Guarantor as of the effective date of the Executed Documents, (i) do not
intend to contract in the Executed Documents for interest to be payable to,
or charged or received by, the Banks in an amount, or at a rate, in excess
of the maximum amount allowed by Applicable Laws, and (ii) have not
arranged or structured the terms of the Executed Documents as a device or
subterfuge for the payment of interest in an amount, or at a rate, in
excess of the maximum amount allowed by law.
4. QUALIFICATIONS. The opinions expressed in Section 2 above are also
---------------
subject to the following qualifications:
(a) SPECIFIED LAWS. The opinions contained in Section 2 as to the
---------------
enforceability of the Security Documents and Executed Documents are subject
to the qualification that enforcement of the Security Documents and
Executed Documents further subject to the following: (i) the rights of the
United States under the Federal Tax Lien Act of 1966, as amended; (ii) the
effect of bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance, the doctrine of commercial reasonableness, and other laws
affecting the rights creditors and/or the collection of debtor's
obligations generally; and (iii) principles of equity and/or exercise of
judicial discretion in accordance with principles of equity, which may
limit the availability of certain equitable remedies.
(b) GENERAL LAWS. The opinions contained in Section 2 as to the
-------------
enforceability of the Security Documents and Executed Documents are further
subject to the qualification that the enforceability of certain of the
remedial, waiver and
Societe Generale
Bank One. Texas, N.A.
July 31, 1996
Page 9
enforcement provisions of the Security Documents and Executed Documents are
subject to other applicable laws, rules and regulations in addition to
those described in subsection 4(a) above; however, such laws, in our
opinion, should not substantially interfere with the practical realization
of the benefits expressed in the Security Documents and Executed Documents,
except for the economic consequences of any procedural delay which may
result from such laws, rules and regulations.
(c) USURY.
-----
(1) The opinions expressed in Section 2 are based upon the
following additional assumptions (without deciding or
opining with respect to such assumptions):
(i) That the late charges and default interest
contracted for by the Banks will be "spread " over the
entire outstanding balance of the Credit Facility for the
full term thereof to determine whether such amounts,
together with the stated accrued interest, exceed the
maximum amount of interest allowed by law; and that the case
▇▇▇▇▇▇ v. Westinghouse Credit Corp., 760 S.W.2d 802 (Tex.
----------------------------------
App-Dallas 1988, no writ.) will not be followed by Texas
courts. In ▇▇▇▇▇▇, the Court ruled that a "a late fee which
------
is computed as interest on past-due interest, accruing
daily, and not a one-time charge, is considered a separate
agreement to be tested for usury separate from any
underlying contract." As a result, the unpaid installment
was considered a separate loan with a term equal to the
period of time it remained unpaid, and the late fee was held
to be usurious.
(ii) That each and every "usury savings clause",
"usury cap" and "spreading clause" contained in the Executed
Documents, which purports to limit the amounts payable
thereunder, will be strictly complied with by the Banks,
will be given its intended effect by the courts of the
State, will also be applied by the Banks, if necessary, to
any monies paid the Banks found to be interest or treated as
interest under the Executed Documents, and will supersede
and control over any conflicting provisions contained in the
Executed Documents.
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 10
(iii) That any fees which have been or which may be paid to
the Banks or to any other party, including, without limitation,
inspection fees, appraisal fees and attorneys' fees are, or will
be, both for services actually rendered and reasonable in any
amount
(iv) That the Banks will comply with the State usury laws
in charging and receiving any amounts constituting interest under
State law.
(v) That the Banks will comply with the terms of the
Executed Documents in crediting to Borrower against the Loan or
refunding to Borrower the amount of any charges or interest paid
which would constitute usury if not so credited or refunded to
Borrower.
(d) Finally, we express no opinion in the context of State Laws
whether or not any commitment, funding or letter of credit fee
set forth in the Executed Documents, interest on interest, "LIBOR
Breakage Costs" as defined in the Credit Agreement, prepayment
charges, attorneys' fees, late charges, or other similar
limitations on the calculation of interest designed to protect
borrowers under State Laws would be characterized as interest on
the Credit Facility or as reducing the amount of the Credit
Facility principal available to Borrower.
5. LIMITATIONS. This Opinion Letter is issued subject to the following
-----------
limitations:
(a) LICENSED ONLY IN TEXAS. We are licensed to practice law only in
----------------------
the State of Texas and we express no opinion with respect to the effect of
any laws other than the laws of the State of and laws of the United States
of general application to transactions in the State of Texas.
(b) SUBSEQUENT EVENTS. We undertake no obligation to advise you of
-----------------
facts or changes in law occurring after the date of this Opinion Letter
which might affect the opinions expressed herein.
(c) CAPTIONS. The captions in this Opinion Letter are for
---------
convenience of reference only and shall not limit, amplify or otherwise
modify the provisions hereof.
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 11
(d) NO IMPLIED OPINIONS. This Opinion Letter is limited to the
-------------------
matters expressly set forth herein, and no opinion is to be implied or may
be inferred beyond the matters expressly so stated herein. Moreover, unless
explicitly addressed in this Opinion Letter, the foregoing opinions do not
address any of the following legal issues, and we specifically express no
opinion with respect thereto:
(a) Federal securities laws and regulations administered by the
Securities and Exchange Commission and state "Blue Sky" laws
and regulations:
(b) Federal Reserve Board margin regulations:
(c) Pension and employee benefit laws and regulations (e.g.,
ERISA):
(d) Federal and state antitrust and unfair competition laws and
regulations:
(e) Federal and state laws and regulations concerning filing and
notice requirements (e.g., ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ and Exon-
▇▇▇▇▇▇);
(f) Compliance with fiduciary duty requirements:
(g) Fraudulent transfer and fraudulent conveyance laws:
(h) Federal and state environmental laws and regulations:
(i) Federal and state land use and subdivision laws and
regulations;
(j) Federal and state tax laws and regulations;
(k) Federal patent, copyright and trademark, state trademark and
other Federal and state intellectual property laws and
regulations;
(l) Federal and state racketeering laws and regulations (e.g.,
RICO);
(m) Federal and state labor laws and regulations;
(n) Other Federal and state statutes of general application to
the extent they provide for criminal prosecution (e.g., mail
fraud and wire fraud statutes); and
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 12
(o) State liquor laws and regulations, or the effect thereof on
any of the Executed Documents.
(e) FINANCIAL INFORMATION. We have made no examination or
---------------------
investigation to verify the truth, accuracy, or completeness of any
financial, accounting or statistical information furnished to the Banks and
express no opinion with respect thereto.
(f) RESTRICTION ON USE. This Opinion Letter is furnished to you and
------------------
the other Banks and your and the other Banks' respective counsel and is
solely for your and the other Banks' benefit, and may not be relied upon
by, nor copies delivered to, any other person without our prior written
consent except for future Banks or participants in the Credit Facility and
their counsel.
Very truly yours,
KANE, RUSSELL, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, P.C.
By:___________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
GBR/tll
EXHIBIT "FF"
FORM OF LOCAL COUNSEL OPINION
-----------------------------
____________________
Societe Generale,
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Re: Credit Facility (the "Credit Facility") of up to
$100,000,000.00 to AMERICAN GENERAL HOSPITALITY
OPERATING PARTNERSHIP, L.P., a Delaware limited
partnership (the "Borrower") pursuant to a Credit
Agreement (the "Credit Agreement") by and between the
Borrower SOCIETE GENERALE, a French banking corporation
acting through its Southwest Agency, as Structuring
Agent (the "Structuring Agent"); BANK ONE, TEXAS, N.A.,
as Administrative Agent (the "Administrative Agent");
and the banks and other financial institution party
thereto (collectively referred to herein as the
"Banks").
Gentlemen:
In connection with the Credit Facility, we have acted as special _______ counsel
to [Borrower/[_______________, a _______________ ("Mortgagor")]. The Credit
Facility is evidenced, in part, by certain promissory notes (the "Notes")
executed by the Borrower and payable to the Banks, the Credit Agreement, the
documents described below and the other documents executed in connection with
the Credit Facility (collectively, the "Credit Documents"). The Mortgagor is
leasing certain real and personal property (the "Property") to AGH Leasing,
L.P., a Delaware limited partnership ("Lessee") pursuant to a Lease Agreement
(the "Lease") between such parties. The real property is located in the County
of ________ (the "County") and the State of _________ (the "State").
1. DOCUMENTS REVIEWED. For purposes of this opinion (the "Opinion
------------------
Letter"), we have examined the following documents, all of which are dated
_____, 1996, unless otherwise specified:
(a) [Deed of Trust/Mortgage], Security Agreement, Assignment of Rents
and Financing Statement (the "Mortgage"), executed by the Mortgagor,
securing payment of the Notes, covering the Property;
(b) Assignment of Leases, Rents and Security Deposits (the "Mortgagor
Assignment of Leases"), executed by the Mortgagor, further securing payment
of the Notes;
(c) UCC Financing Statements executed by the Mortgagor to be filed in
the real property records (the "Records") of the County and with the
Secretary of State (the "Secretary of State") of the State (respectively,
the "Mortgagor County Financing Statement" and the "Mortgagor State
Financing Statement" and collectively the "Mortgagor Financing
Statements");
(d) Assignment of Leases, Rents and Security Deposits (the "Lessee
Assignment of Leases"), executed by the Lessee in favor of the Mortgagor
securing the Lessee's obligations under the Lease; and
(e) UCC Financing Statements executed by the Lessee to be filed in
the Records and with the Secretary of State (respectively, the "Lessee
County Financing Statement" and the "Lessee State Financing Statement" and
collectively the "Lessee Financing Statements").
For purposes of this Opinion Letter, the Mortgage and the Mortgagor Assignment
of Leases are hereinafter collectively referred to as the "Security Documents".
All of the documents described in clauses (a)-(e) above and executed by the
Mortgagor or the Lessee are hereinafter collectively referred to as the
"Executed Documents."
2. OPINIONS. Subject to the matters set forth in subsequent portions of
--------
this Opinion Letter, it is our opinion that:
(a) Each of the Security Documents constitutes the legal, valid and
binding obligation of the Mortgagor, enforceable against the Mortgagor in
accordance with their terms.
(b) The Lessee Assignment of Leases constitutes the legal, valid and
binding obligation of the Lessee, enforceable against the Lessee in
accordance with its terms.
(c) The Mortgage and the Mortgagor County Financing Statement are in
proper form for filing in the Records, and the Mortgagor State Financing
Statement
is in proper form for filing with the Secretary of State. Upon the
recording of the Mortgage and the Mortgagor County Financing Statement in
the Records, and upon the filing of the Mortgagor State Financing Statement
with the Secretary of State, no other recording, filing or other action
under the laws of the State is required in order to perfect the liens in
the Property, the security interest in the fixtures created thereby and the
security interest in the personally described therein.
(d) Upon proper filing of the Mortgagor County Financing Statement in
the Records and the Mortgagor State Financing Statement with the Secretary
of State, the "Said Indebtedness" under the Mortgage will be secured by a
validly created, perfected security interest in favor of the Administrative
Agent for the benefit of the Banks in and to all the right, title and
interest of the Mortgagor in and to the collateral described in the
Mortgagor Financing Statements, to the extent such collateral is located in
the State, and upon the proper filing of the Mortgage in the Records, the
"Said Indebtedness" under the Mortgage will be secured by a validly
created, perfected mortgage lien in favor of the Administrative Agent for
the benefit of the Banks in and to all the right, title and interest of the
Mortgagor in and to the real property and fixtures described in the
Mortgage.
(e) The Lessee County Financing Statements is in proper form for
filing in the Records, and the Lessee State Financing Statement is in
proper form for filing with the Secretary of State. Upon the recording of
the Lessee County Financing Statements in the Records, and upon the filing
of the Lessee State Financing Statements with the Secretary of State, no
other recording, filing or other action under the laws of the State is
required in order to perfect the liens in the property described therein.
(f) Upon proper filing of the Lessee County Financing Statement in
the Records and the Lessee State Financing Statement with the Secretary of
State, the Lessee's obligations under the Lease will be secured by a
validly created, perfected security interest in favor of the Mortgagor in
and to all the right, title and interest of the Lessee in and to the
collateral described in the Lessee Financing Statements, to the extent such
collateral is located in the State.
(g) There are no stamp, recording or similar taxes required to be
paid in connection with the execution, delivery, recording or enforcement
of the Mortgage except as follows:
(h) The Mortgagor and the Lessee are authorized to do business and in
good standing in the State.
(i) To our knowledge after due inquiry, no approval, authorization or
other action by any governmental authority of the State, is required in
connection with the execution and delivery of the Executed Documents by the
Mortgagor and/or the Lessee, and the consummation of the transactions
contemplated thereby.
(j) Based on adherence to existing judicial precedents under State
law, except for those matters under the Security Documents related to the
perfection of liens on and security interests in real estate, fixtures and
personal property and the exercise of remedies against such collateral, a
State court would hold that the choice of Texas law to govern the
construction and interpretation of the provisions of the Credit Documents,
including without limitation those provisions related to usury, would be
enforceable.
3. ASSUMPTIONS. In delivery of the opinions expressed in Section 2
-----------
above, we have assumed the following:
(a) CAPACITY. We have assumed the legal capacity of each individual
--------
signing one or more of the Executed Documents or other documentation upon
which this Opinion Letter has been based.
(b) BANKS' AUTHORITY. The Banks are authorized to make the Credit
----------------
Facility in accordance with the Credit Documents. The Executed Documents,
and the transactions evidenced thereby, are valid, binding and enforceable
with regard to the Banks and/or any other parties executing the Executed
Documents other than the Mortgagor and the Lessee.
(c) MORTGAGOR'S AND LESSEE'S AUTHORITY. The Mortgagor and the Lessee
----------------------------------
are duly formed, are validly existing, and are authorized to do business
and in good standing under the laws of their respective states of creation.
The Mortgagor has the requisite [partnership] power and authority to own
its assets, to transact the business in which it will be engaged in
connection with the Property, to execute and deliver the Executed Documents
in the capacity therein stated, and to perform its obligations under the
Security Documents. The Lessee has the requisite partnership power and
authority to own its assets, to transact the business in which it will be
engaged in connection with the Property, to execute and deliver the Lessee
Assignment of Leases in the capacity therein stated, and to perform its
obligations under the Lessee Assignment of Leases. Each of the Executed
Documents has been duly executed and delivered by the Mortgagor and the
Lessee, as applicable.
(d) GENUINENESS AND AUTHENTICITY. All signatures appearing on all
----------------------------
Executed Documents are genuine; all documents and records submitted to us
as originals are authentic; all documents and records submitted to us as
copies conform to the corresponding original documents and records; and all
statements of fact therein are true.
(e) CONTRACTS. Substantial negotiations for the Credit Facility and
---------
the closing of the Credit Facility occurred in Texas. The Structuring
Agent's, the Administrative Agent's and the Borrower's and Lessee's
principal place of business is in Texas. The Credit Facility will be funded
out of New York. Repayments under the Credit Facility will be made in
Texas.
4. QUALIFICATIONS. The opinions expressed in Section 2 above are
--------------
subject to the following qualifications:
(a) SPECIFIED LAWS. The opinions contained in Section 2 as to the
--------------
enforceability of the Security Documents are subject to the qualification
that enforcement of the Security Documents is further subject to the
following: (i) the rights of the United States under the Federal Tax Lien
Act of 1966, as amended; (ii) the effect of bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance, the doctrine of
commercial reasonableness, and other laws affecting the rights of creditors
and/or the collection of debtor's obligations generally; and (iii)
principles of equity and/or exercise of judicial discretion in accordance
with principles of equity, which may limit the availability of certain
equitable remedies.
(b) GENERAL LAWS. The opinions contained in Section 2 as to the
------------
enforceability of the Security Documents are further subject to the
qualification that the enforceability of certain of the remedial, waiver
and enforcement provisions of the Security Documents are subject to other
applicable laws, rules and regulations in addition to those described in
subsection 4(a) above; however, such laws, in our opinion, should not
substantially interfere with the practical realization of the benefits
expressed in the Security Documents, except for the economic consequences
of any procedural delay which may result from such laws, rules and
regulations.
5. LIMITATIONS. This Opinion Letter is issued subject to the following
-----------
Limitations:
(a) LICENSED ONLY IN _______. We are licensed to practice law only
----------------
in the State of______and we express no opinion with respect to the effect
of any laws other than the laws of the State of______ and laws of the
United States of general application to transactions in the State
of________.
(b) SUBSEQUENT EVENTS. We undertake no obligation to advise you of
-----------------
facts or changes in law occurring after the date of this Opinion Letter
which might effect the opinions expressed herein.
(c) CAPTIONS. The captions in this Opinion Letter are for
--------
convenience of reference only and shall not limit, amplify or otherwise
modify the provisions hereof.
(d) NO IMPLIED OPINIONS. This Opinion Letter is limited to the
-------------------
matters expressly set forth herein, and no opinion is to be implied or may
be inferred beyond the matters expressly so stated herein.
(e) FINANCIAL INFORMATION. We have made no examination or
---------------------
investigation to verify the truth, accuracy, or completeness of any
financial, accounting or statistical information furnished to the Banks and
express no opinion with respect thereto.
(f) RESTRICTION ON USE. This Opinion Letter is furnished to you and
------------------
the other Banks and your and the other Banks' respective counsel and is
solely for your and the other Banks' benefit, and may not be relied upon
by, nor copies delivered to, any other person without our prior written
consent except for future Banks or participants in the Credit Facility and
their counsel.
Very truly yours,
____________________
EXHIBIT "GG"
[LETTERHEAD OF ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & INGERSOLL]
July 31, 1996
Battle ▇▇▇▇▇▇ LLP
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Societe Generale, Southwest Agency
Suite 4900
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Bank One, Texas, N.A.
Commercial Real Estate Lending
Fourth Floor
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Re: American General Hospitality Corporation
----------------------------------------
Ladies and Gentlemen:
We have acted as Maryland counsel for American General Hospitality
Corporation, a Maryland corporation (the "Company"), in connection with certain
matters of Maryland law arising out of the execution and delivery by the Company
of an Environmental Indemnification Agreement and a Guaranty and Contribution
Agreement, both dated as of July 31, 1996, both to and for the benefit of
Societe Generale, Southwest Agency and Bank One, Texas, N.A. (collectively, the
"Loan Documents"). This firm did not participate in the drafting or the
negotiation of the Loan Documents.
In connection with our representation of the Company, and as a basis
for the opinion hereinafter set forth, we have examined originals, or copies
certified or otherwise identified to our satisfaction, of the following
documents (hereinafter collectively referred to as the "Documents"):
Battle ▇▇▇▇▇▇ LLP
Societe Generale, Southwest Agency
Bank One, Texas, N.A.
July 31, 1996
Page 2
1. The charter of the Company (the "Charter"), certified as of a
recent date by the State Department of Assessments and Taxation of Maryland (the
"SDAT");
2. The Bylaws of the Company (the "Bylaws"), certified as of a
recent date by its Secretary;
3. A certificate as of a recent date of the SDAT as to the good
standing of the Company;
4. Resolutions adopted by the Board of Directors of the Company
relating to (a) the organization of the Company and (b) the Company's execution
and delivery of the Loan Documents, certified as of a recent date by the
Secretary of the Company;
5. Copies of the executed Loan Documents, certified as of a recent
date by the Secretary of the Company;
6. A certificate executed by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Secretary of the
Company, dated July 31, 1996, attached hereto as Exhibit A; and
7. Such other documents and matters as we have deemed necessary or
appropriate to express the opinion set forth in this letter, subject to the
assumptions, limitations and qualifications stated herein.
In expressing the opinion set forth below, we have assumed, and so far
as is known to us there are no facts inconsistent with, the following:
1. Each of the parties (other than the Company) executing any of the
Documents has duly and validly executed and delivered each of the Documents to
which such party is a signatory, and such party's obligations set forth therein
are legal, valid and binding and are enforceable in accordance with all stated
terms except as limited (a) by bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other laws relating to or affecting the
enforcement of creditors, rights and (b) by general equitable principles.
2. Each individual executing any of the Documents on behalf of a
party (other than the Company) is duly authorized to do.
Battle ▇▇▇▇▇▇ LLP
Societe Generale, Southwest Agency
Bank One, Texas, N.A.
July 31, 1996
Page 3
3. Each individual executing any of the Documents, whether on behalf
of such individual or another person, is legally competent to do so.
4. All Documents submitted to us as originals are authentic. All
Documents submitted to us as certified or photostatic copies conform to the
original documents. All signatures on all Documents are genuine. All public
records reviewed or relied upon by us or on our behalf are true and complete.
All statements and information contained in the Documents are true and complete.
There are no oral or written modifications of or amendments to the Documents,
and there has been no waiver of any of the provisions of the Documents, by
action or conduct of the parties or otherwise.
The phrase "known to us" is limited to the actual knowledge, without
independent inquiry, of the lawyers at our firm who have performed legal
services in connection with the issuance of this opinion.
Based upon the foregoing, and subject to the assumptions, limitations
and qualifications stated herein, it is our opinion that:
1. The Company is a corporation duly incorporated and validly
existing under and by virtue of the laws of the State of Maryland and is in good
standing with the SDAT. The Company has full corporate power to execute and
deliver the Loan Documents.
2. The Company's execution and delivery of the Loan Documents have
been duly authorized by the Company. The Loan Documents have been duly executed
and, so far as is known to us, delivered by the Company.
The foregoing opinion is limited to the substantive laws of the State
of Maryland and we do not express any opinion herein concerning any other law.
We express no opinion as to compliance with the securities (or "blue sky") laws
of the State of Maryland or as to federal or state laws regarding fraudulent
transfers. We note that each of the Loan Documents provides that each shall be
governed by the laws of the State of Texas. To the extent that any matter as to
which our opinion is expressed herein would be governed by any jurisdiction
other than the State of Maryland, we do not express any opinion on such matter.
The opinion expressed
Battle ▇▇▇▇▇▇ LLP
Societe Generale, Southwest Agency
Bank One, Texas, N.A.
July 31, 1996
Page 4
herein is subject to the effect of judicial decisions which may permit the
introduction of parol evidence to modify the terms or the interpretation of
agreements.
We assume no obligation to supplement this opinion if any applicable
law changes after the date hereof or if we become aware of any fact that might
change the opinion expressed herein after the date hereof.
This opinion is being furnished to Battle ▇▇▇▇▇▇ LLP solely for the
express purpose of relying upon this opinion to furnish its opinion of even date
hereof to the Lenders. In addition, this opinion is being furnished to the
Lenders solely for their benefit and the benefit of any future successors,
assigns or participants of the Lenders permitted in the Loan Documents.
Accordingly, it may not be relied upon by, quoted in any manner to, or delivered
to any other person or entity without, in each instance, our prior written
consent.
Very truly yours,
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
Societe Generale.
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 8
Banks and/or any other parties executing the Executed Documents other than
the Mortgagor and the Lessee. The Banks are duly incorporated, and are
validly existing and in good standing under applicable laws. The Banks have
complied, and will continue to comply, with all laws, rules and regulations
of the State of Ohio and any other jurisdiction where it is required by law
to comply, to the extent that failure by the Banks to comply therewith,
would impair or affect any of the opinions stated herein.
(c) LESSEE'S AUTHORITY. The lessee is duly formed, validly existing,
------------------
and is authorized to do business and in good standing under the laws of its
state of creation. The Lessee has the requisite partnership power and
authority to own its assets, to transact the business in which it will be
engaged in connection with the Property, to execute and deliver the Lessee
Assignment of Lease and the other Executed Documents to which it is a party
in the capacity therein stated, and to perform its obligations under the
Lessee Assignment of Lease and the other Executed Documents to which party.
Each of the Executed Documents to which the Lessee is a party has been duly
executed and delivered by the Lessee. The execution, delivery and
performance by Lessee of the Executed Documents to which it is a party do
not (i) violate any laws, rules, statutes or regulations of general
applicability to partnerships presently in effect; (ii) breach, or
constitute a default under, any existing obligation of Lessee under any
material agreement to which it is a party or to which its property or
assets are subject; (iii) breach or otherwise violate any existing
obligation of Lessee under any court order; or (iv) result in the
imposition of any lien, charge or encumbrance of any nature upon any of
Lessee's properties or assets other than as granted under the Executed
Documents.
(d) GENUINENESS AND AUTHENTICITY. All signatures appearing on all
----------------------------
Executed Documents are genuine; all documents and records submitted to us
as originals are authentic; all documents and records submitted to us as
copies conform to the corresponding original documents and records; and all
statements of fact therein are true.
(e) CONTACTS. Substantial negotiations for the Credit Facility and
--------
the closing of the Credit Facility occurred in Texas. The Structuring
Agent's, the Administrative Agent's and the Borrower's and Lessee's
principal place of business is in Texas. The Credit Facility will be funded
out of New York. Repayments under the Credit Facility will be made in
Texas.
(f) OTHER. Mortgagor and Lessee hold the requisite title and rights
-----
to any property intended to subject to the Executed Documents. No action
has been taken which amends, renders or otherwise affects any of the
documents, materials or records
Societe Generale,
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 9
which we have examined. Value has been given by the Banks in connection
with the transactions contemplated by the Executed Documents.
(g) PARTNERSHIP CERTIFICATE. The Partnership Certificate has been, or
-----------------------
will be immediately after the execution of the Credit Agreement, filed of
record in the Recorder's office of ▇▇▇▇▇ Country, Ohio.
4. QUALIFICATIONS. The opinions expressed in Section 2 above are subject
--------------
to the following qualifications.
(a) SPECIFIED LAWS. The opinions contained in Section 2 are subject to
--------------
the qualification that enforcement of the Executed Documents is further
subject to the following: (i) the rights of the United States under the
Federal Tax Lien Act of 1966, as amended; (ii) the effect of bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance, the doctrine
of commercial reasonableness, and other laws affecting the rights of
creditors and/or the collection of debtor's obligations generally: (iii)
principles of equity and/or exercise of judicial discretion in accordance
with principles of equity, which may limit the availability of certain
equitable remedies; and (iv) the obligation of the Administrative Agent and
the Banks to act reasonably, in good faith with fairness and subject to
materiality standards in exercising rights under the Executed Documents.
(b) GENERAL LAWS. Applicable laws, including judicial decisions, may
------------
limit or render ineffective certain rights, remedies, waivers and
provisions of the Executed Documents and, therefore, the Executed Documents
may not be enforceable in all respects as stated. For example, (i)
provisions for the recovery of expenses in connection with the enforcement
of remedies, including, among others, legal fees and expenses, may not be
enforceable; (ii) provisions resulting in a waiver by Mortgagor of certain
rights may be limited by legal and equitable principles and public policy;
(iii) the availability of specific performance, injunctive relief or other
equitable remedies and the appointment of a receiver are subject to the
discretion of the court before which any proceeding therefor any be
brought; (iv) late payment charges and default interest rate provisions may
be unenforceable if deemed by a court to constitute a penalty; (v)
provisions for the establishment of evidentiary standards may be
unenforceable; and (vi) the disposition of the personal property
constituting part of the collateral under the Executed Documents, including
without limitation the method, manner, time, place and terms, must be
commercially reasonable as provided in the Uniform Commercial Code as
adopted in Ohio. Furthermore we express no opinion as to any provision of
the
Societe Generale,
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 10
Executed Documents which (i) purport to give the Banks or any other person
the right to act as attorney-in-fact and thereupon sign documents and take
actions, such as a confession of judgment in the name of the Mortgagor or
Lessee; (ii) purport to waive any right to notice or consent with respect
to extensions or increases of the indebtedness or any surrender or release
of collateral securing the indebtedness; (iii) provide that the choice of
one remedy is not a bar to the availability of any other remedy at law
and/or equity; (iv) attempt to grant to the Banks a power of sale or to
modify or waive any requirements of judicial foreclosure, including but not
limited to, those relating to appraisement, valuation or redemption,
modifications or waivers of stays, extensions, moratorium or homestead
rights or exemptions; and (v) purport to secure any indebtedness or
obligation other than those within the contemplation of the parties as of
the date of the execution and delivery of the Executed Documents.
(c) TITLE. We have made no examination of and express no opinion as
-----
to the title to, or ownership of, the personal and real property
contemplated as security by the Executed Documents, or the status of any
liens or encumbrances thereon, or the priority of the liens and
encumbrances to be created by the Executed Documents, or the accuracy or
sufficiency of the description of any property or the freedom of any
property from any liens and encumbrances. No opinion is given as to the
effect of the granting of a mortgage or other security interest in the
collateral described in the Executed Documents before Mortgagor or Lessee
have rights in the same.
(d) LAWS. We express no opinion with respect to compliance with, or
----
the applicability of, any of the following:
(1) Federal and state securities laws and regulations; (2) Federal Reserve
Board margin regulations; (3) local (i.e. other than those of the State)
laws, ordinances, rules and regulations and judicial decisions to the
extent that they deal with any of the foregoing; (4) federal and state
environmental laws and regulations; (5) federal and state land use and
subdivision laws and regulations; (6) federal patent, copyright and
trademark, state trademark, and other Federal and state intellectual
property laws and regulations; (7) obtaining and maintaining licenses,
permits or other similar documents; and (8) federal and state banking
regulatory laws other than those affecting security interests in real
property.
(e) THIRD PARTIES. Certain of the provisions of the Executed
-------------
Documents which purport to bind lessees or third parties, or to make null
and void certain agreements, instruments, or transactions which may be
entered into between Mortgagor
Societe Generale,
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 11
and/or Lessee and third parties may not be effective against such lessees
or third parties. Furthermore, the Executed Documents may not be effective
with respect to certain contracts, including but not limited to the Hilton
Hotel Franchise Agreement, which pursuant to their terms are either not
assignable or require the consent of parties other than the Mortgagor or
Lessee.
(f) BANKRUPTCY. The security interest created by the Loan Documents
----------
in personal property that is acquired by Borrower after the date hereof
will be limited by ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bankruptcy Code
regarding the extent to which property acquired by a debtor after the
commencement of a case under the United States Bankruptcy Code may be
subject to a security interest arising from a security agreement entered
into by the debtor before the commencement of such case.
(g) MORTGAGE. The mortgage liens of the Mortgage: (1) will not
--------
extend to after-acquired real property (including, but not limited to,
property which is unitized or pooled with the real property subject to the
Mortgage subsequent to the recording of the Mortgage) until a supplemental
mortgage describing such property has been duly executed, delivered and
recorded: (2) will expire with respect to third parties subsequently
acquiring an interest in the real property described therein twenty-one
years after the stated maturity date contained therein and may be
maintained thereafter only by refiling in the manner provided by Section
5301.30 of the Ohio Revised Code: and (3) accord priority as to future
advances thereunder equivalent to that of advances made on the date the
Mortgage is recorded only if Lender is obligated to make such future
advances in accordance with the Credit Documents.
(h) KNOWLEDGE. The term "our knowledge" as used herein shall mean the
---------
conscious awareness of information about either fact or law by those
lawyers in our firm who have devoted substantive attention to the
transaction contemplated by the Security Documents.
5. LIMITATIONS. This Opinion Letter is issued subject to the following
-----------
limitations:
(a) LICENSED ONLY IN OHIO. We are licensed to practice law only in
---------------------
the State of Ohio and we express no opinion with respect to the effect of
any laws other than the laws of the State of Ohio and laws of the United
States of general application to transactions in the State of Ohio.
Societe Generale,
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 12
(b) SUBSEQUENT EVENTS. We undertake no obligation to advise you of
-----------------
facts or changes in law or of anything coming to our attention bearing upon
the accuracy of or completeness of any assumption, whether or not material,
occurring after the date of this Opinion Letter which might effect the
opinions expressed herein.
(c) CAPTIONS. The captions in this Opinion Letter are for convenience
--------
of reference only and shall not limit, amplify or otherwise modify the
provisions hereof.
(d) NO IMPLIED OPINIONS. This Opinion Letter is limited to the
-------------------
matters expressly set forth herein, and no opinion is to be implied or may
be inferred beyond the matters expressly so stated herein.
(e) FINANCIAL INFORMATION. We have made no examination or
---------------------
investigation to verify the truth, accuracy, or completeness of any
financial, accounting or statistical information furnished to the Banks and
express no opinion with respect thereto.
(f) RESTRICTION ON USE. This Opinion Letter is furnished to you and
------------------
the other Banks and your and the other Banks' respective counsel and is
solely for your and the other Banks' benefit, and may not be replied upon
by, nor copies delivered to, any other person without our prior written
consent except for future Banks or participants in the Credit Facility and
their counsel or any other counsel rendering an opinion in connection with
the Credit Documents or any of the transactions described therein.
(g) INFORMATION. We do not assume any responsibility for the
-----------
accuracy, completeness or fairness of any information including but not
limited to, financial information, furnished to you by Mortgagor or Lessee
concerning the business or affairs of Mortgagor or Lessee or any other
information furnished to you of a factual nature. Furthermore, we render no
opinion with respect to the past, present or future financial condition of
Mortgagor or Lessee.
This opinion does not constitute a guarantee of the Executed Documents or
the obligations of Mortgagor or Lessee thereunder or any other matter referred
to or opined upon herein, and by rendering this opinion, we are not guaranteeing
the Executed Documents or any such obligations. We bring to your attention that
our views set forth in this letter are an
Societe Generale,
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 13
expression of professional judgment and are not a guarantee of a result.
Very truly yours,
/s/ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇.
▇▇▇▇▇ & ▇▇▇▇▇ Co., L.P.A.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇. ▇▇▇▇▇ &
▇▇▇▇▇ Co., L.P.A.
[LETTERHEAD OF MCDONALD, HOPKINS, ▇▇▇▇▇ & ▇▇▇▇▇]
EXHIBIT "HH"
July 31, 1996
Societe Generale,
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Bank One, Texas, N.A.,
As Administrative Agent
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ Department
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Battle ▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Credit Facility (the "Credit Facility") of up to $100,000,000.00 to
AMERICAN GENERAL HOSPITALITY OPERATING PARTNERSHIP. L.P., a Delaware
limited partnership (the "Borrower") pursuant to a Credit Agreement
(the "Credit Agreement") by and between the Borrower; SOCIETE
GENERALE, a French banking corporation acting through its Southwest
Agency, as Structuring Agent (the "Structuring Agent"); BANK ONE,
TEXAS, N.A., as Administrative Agent (the "Administrative Agent"); and
the banks and other financial institutions which are a party thereto
(collectively referred to herein as the "Banks").
Gentlemen:
In connection with the Credit Facility, we have acted as special Ohio
counsel to 3100 Glendale Joint Venture, an Ohio general partnership,
("Mortgagor") and this opinion letter is being delivered to you at the request
of Mortgagor. The Credit Facility is evidenced, in part, by certain promissory
notes (the "Notes") executed by the Borrower and payable to the Banks, the
Credit Agreement, the documents described in 1.(a) through (e) below and the
other documents executed in connection with the Credit Facility (collectively,
the "Credit Documents"). The Mortgagor is subleasing certain real and personal
property to AGH Leasing, L.P., a Delaware limited partnership ("Lessee")
pursuant to a Lease Agreement (the "Lease") between such parties. The real
property is located in the County of ▇▇▇▇▇ (the "County") and the State of Ohio
(the "State").
Societe Generale.
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 2
1. DOCUMENTS REVIEWED. For purposes of this opinion (the "Opinion
------------------
Letter"), we have examined only the following of the Credit Documents, all of
which are dated July 31, 1996, unless otherwise specified:
(a) Open-End Mortgage, Security Agreement, Assignment of Rents and
Financing Statement (the "Mortgage"), executed by the Mortgagor, securing
payment of the Notes, covering certain real and personal property described
in the Mortgage (the "Property");
(b) Assignment of Leases, Rents and Security Deposits (the "Mortgagor
Assignment of Leases"), executed by the Mortgagor, further securing payment
of the Notes;
(c) UCC Financing Statements executed by the Mortgagor to be filed in
the real property records (the "Records") of the County and with the
Secretary of State (the "Secretary of State") of the State (respectively,
the "Mortgagor County Financing Statement" and the "Mortgagor State
Financing Statement" and collectively the "Mortgagor Financing
Statements");
(d) Assignment of Leases, Rents and Security Deposits (the "Lessee
Assignment of Leases"), executed by the Lessee in favour of the Mortgagor
securing the Lessee's obligations under the Lease;
(e) UCC Financing Statements executed by the Lessee to be filed in
the Records and with the Secretary of State (respectively, the "Lessee
County Financing Statement" and the "Lessee State Financing Statement" and
collectively the "Lessee Financing Statements").
(f) Irrevocable Direction to Pay Rent executed by Borrower, Mortgagor
and others;
(g) Security Agreement executed by Borrower, Mortgagor and others;
(h) Environmental Indemnification Agreement executed by Mortgagor and
others for the benefit of the Banks;
(i) Guaranty and Contribution Agreement executed by Mortgagor and
others for the benefit of the Banks; and
Societe Generale.
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 3
(j) Collateral Assignment and Security Agreement by Mortgagor in
favor of the Banks.
For purposes of this Opinion Letter, the Mortgage and the Mortgagor
Assignment of Leases are hereinafter collectively referred to as the "Security
Documents". All of the documents described in clauses (a)-(j) above and executed
by the Mortgagor or the Lessee are hereinafter collectively referred to as the
"Executed Documents."
For purposes of this opinion letter, we have considered such matters of law
and of fact, and have examined and relied upon originals or copies, certified or
otherwise identified to our satisfaction as being true copies, of such
certificates, corporate documents and records, officers' certificates,
certificates of public officials and other documents as we have deemed relevant
and necessary as a basis for the opinions expressed herein, including but not
limited to the following:
(a) First Amended Partnership Certificate of Glendale dated July 31,
1996 executed by the Borrower and AGH UPREIT LLC, a Delaware Limited
Liability Company (the "UPREIT") in recordable form to be filed with
Recorder's office of ▇▇▇▇▇ County, Ohio ("Partnership Certificate");
(b) Amended and Restated Joint Venture Agreement of Glendale executed
by the Borrower and the UPREIT dated July 31, 1996 ("Partnership
Agreement") as certified by the general partners of Glendale;
(c) Resolutions of the general partners of Glendale dated _____, 1996
as certified by the general partners of Glendale;
(d) Certificate on behalf of Glendale by the Borrower and the UPREIT,
the general partners of Glendale (the "Partners Certificate"), dated as of
the date hereof, relating to the facts set forth herein upon which the
opinions expressed herein are based;
(e) Certificate on behalf of the Borrower by the general partner of
Borrower, dated as of the date hereof, relating to the facts set forth
herein upon which the opinions expressed herein are based;
(f) Certificate on behalf of the UPREIT by the members of the UPREIT,
dated as of the date hereof, relating to the facts set forth herein upon
which the opinions expressed herein are based;
Societe Generale.
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 4
(g) Officer's Certificate on behalf of AGH GP, Inc. (the "Officer's
Certificate") dated as of the date hereof, relating to the facts set forth
herein upon which the opinions expressed herein are based;
(h) Officer's Certificate on behalf of American General Hospitality
Corporation as a member of the UPREIT (the "Member's Certificate") dated as
of the date hereof, relating to the facts set forth herein upon which the
opinions expressed herein are based;
(i) Certificate for AGH GP, Inc. issued by the Nevada Secretary of
State dated July 15, 1996 relating to the good standing of AGH GP, Inc.,
the general partner of Borrower, which is the general partner of Glendale;
(j) Certificate for AGH LP, Inc. issued by the Nevada Secretary of
State dated July 15, 1996 relating to the good standing of AGH LP, Inc.,
the limited partner of Borrower, which is a general partner of Glendale;
(k) Certificate for AGH UPREIT, LLC issued by the Delaware Secretary
of State dated July 12, 1996 relating to the good standing of AGH UPREIT,
LLC, a general partner of Glendale;
(l) Certificate for American General Hospitality Corporation issued
by the Maryland Secretary of State dated July 12, 1996 relating to the good
standing of American General Hospitality Corporation, which is a member of
the UPREIT;
(m) Certificate for American General Hospitality Operating
Partnership L.P. issued by the Delaware Secretary of State dated July ____,
1996 relating to the good standing of American General Hospitality
Operating Partnership L.P., which is a general partner of Glendale and a
member of the UPREIT;
(n) Certificates for the UPREIT, the Borrower, and AGH GP, Inc.,
issued by the Ohio Secretary of State, each of which is dated July 17,
1996, relating to the qualification of each of such entities to do business
in Ohio;
(o) Certificate for the Lessee issued by the Ohio Secretary of State
dated ______, 1996 relating to the qualification of Lessee to do business
in Ohio;
Societe Generale,
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 5
(p) Ground Lessor's Estoppel Certificate and Agreement executed on
behalf of the State of Ohio on July ____, 1996 and the Medical College of
Ohio at Toledo on July ____, 1996 ("Estoppel Certificate");
(q) Acknowledgement Concerning Ground Lease and Consent to Sublease
executed on behalf of the state of Ohio on July ____, 1996 and the Medical
College of Ohio at Toledo on July ____, 1996 ("Consent").
As to questions of fact material to the opinions expressed herein, we have
relied upon, and assumed the accuracy of, the certificates and other documents
described above, the representations and warranties made in or pursuant to the
Executed Documents and such certificates, corporate records, searches and other
documents that we have reviewed, including but not limited to those described
above, in connection with giving the opinions expressed herein. We have assumed
that there are no other facts, conditions or circumstances which conflict with
or are inconsistent with those set forth in any of the foregoing. With respect
to such matters, we have not made any independent investigation or verification
of the information contained therein for purposes of this opinion letter.
2. OPINIONS. Subject to the matters set forth in subsequent portions of
--------
this Opinion Letter, it is our opinion that:
(a) Each of the Security Documents constitutes the legal, valid and
binding obligation of the Mortgagor, enforceable against the Mortgagor in
accordance with their terms.
(b) The Lessee Assignment of Leases constitutes the legal, valid and
binding obligation of the Lessee, enforceable against the Lessee in
accordance with its terms.
(c) The Mortgage and the Mortgagor County Financing Statement are in
proper form for filing in the Records, and the Mortgagor State Financing
Statement is in proper form for filing with the Secretary of State. Upon
the recording of the Mortgage and the Mortgagor County Financing Statement
in the Records, and upon the filing of the Mortgagor State Financing
Statement with the Secretary of State no other recording or filing under
the laws of the State is required in order to perfect the liens in those
items and types of collateral described therein that (a) are real property
or (b) are personal property for which a security interest may be perfected
by the filing of financing statements in Ohio under the Uniform Commercial
Code as adopted in Ohio.
Societe Generale
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, `996
Page 6
(d) Upon proper filing of the Mortgagor County Financing Statement in
the Records and the Mortgagor State Financing Statement with the Secretary
of State, the "Said Indebtedness" under the Mortgage (up to an amount
described in Section 33(a) of the Mortgage) will be secured by a validly
created, perfected security interest in favor of the Administrative Agent
as agent for the Banks and to all the right, title and interest of the
Mortgagor in and to the collateral described in the Mortgagor Financing
Statements, to the extent a security interest may be perfected in such
collateral by the filing of financing statements in Ohio under the Uniform
Commercial Code as adopted in Ohio.
(e) The Lessee County Financing Statement is in proper form for
filing in the Records, and the Lessee State Financing Statement is in
proper form for filing with the Secretary of State. Upon the recording of
the Lessee County Financing Statement in the Records, and upon the filing
of the Lessee State Financing Statement with the Secretary of State, no
other recording or filing under the laws of the State is required in order
to perfect the liens in those items and types of collateral described
therein for which a security interest may be perfected by the filing of
financing statements in Ohio under the Uniform Commercial Code.
(f) Upon proper filing of the Lessee County Financing Statement in
the Records and the Lessee State Financing Statement with the Secretary of
State, the Lessee's obligations under the Lease will be secured by a
validly created, perfected security interest in favor of the Mortgagor in
and to all the right, title and interest of the Lessee in and to the
collateral described in the Lessee Financing Statements, to the extent a
security interest may be perfected in such collateral by the filing of
financing statements in Ohio under the Uniform Commercial Code as adopted
in Ohio.
(g) There are no stamp, recording or similar taxes required to be
paid in connection with the execution, delivery, recording or enforcement
of the Mortgage except nominal recording fees payable at the time of
recording the Mortgage.
(h) The Mortgagor is duly formed and validly existing under the laws
of the State with full power and authority to own, lease and operate its
properties and to conduct its business as described in the Partnership
Agreement and is duly qualified to conduct its business in the State. The
Mortgagor has the requisite power and authority to execute the Executed
Documents to which it is a party in the capacity therein stated, and to
perform its obligations under the Executed Documents to which it is a
party. The Lessee is duly qualified to do business in the State.
Societe Generale,
Southwest Agency
Bank One, Texas, N.A.
Battle ▇▇▇▇▇▇ LLP
July 31, 1996
Page 7
(i) The general partners of Mortgagor have taken all necessary
partnership or corporate action to authorize the execution of the Executed
Documents to which Mortgagor is a party, and Mortgagor has taken all
partnership action necessary to authorize the execution of the Executed
Documents to which it is a party.
(j) Each of the Executed Documents to which Mortgagor is a party has
been executed by duly authorized representatives of the general partners on
behalf of Mortgagor.
(k) All of the outstanding interests of 3100 Glendale are validly
created under the Partnership Agreement forming Glendale and, to our
knowledge based solely on the Partners Certificate, are owned of record in
the following percentage amounts: 99% by the Borrower and 1% by the UPREIT.
(l) To our knowledge, no approval, authorization or other action by
any governmental authority of the State, is required in connection with the
execution and delivery of the Executed Documents by the Mortgagor and/or
the Lessee, and the consummation of the transactions contemplated thereby
other than those contained in the Estoppel Certificate and Consent.
(m) Based on adherence to existing judicial precedents under State
law, except for those matters under the Security Documents related to the
perfection of liens on and security interests in real estate, fixtures and
personal property and the exercise of remedies against such collateral, a
State court would hold that the choice of Texas law to govern the
construction and interpretation of the provisions of the Executed Documents
would be enforceable, except to the extent that the application of Texas
law would be contrary to a fundamental policy of the State of Ohio.
3. ASSUMPTIONS. In delivery of the opinions expressed in Section 2 above,
-----------
we have assumed the following:
(a) CAPACITY. The legal capacity of each individual signing one or
--------
more of the Executed Documents or other documentation upon which this
Opinion Letter has been based.
(b) BANKS' AUTHORITY. The Banks are authorized to make the Credit
----------------
Facility in accordance with the Credit Documents. The Executed Documents,
and the transactions evidenced thereby, are valid, binding and enforceable
with regard to the
EXHIBIT "II"
[LETTERHEAD OF ▇▇▇▇▇ & LARDNER}
July ______, 1996
Societe Generale,
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Bank One, Texas, N.A.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Battle ▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Credit Facility (the "Credit Facility") of up to
$100,000,000.00 to AMERICAN GENERAL HOSPITALITY OPERATING
PARTNERSHIP, L.P., a Delaware limited partnership (the
"Borrower") pursuant to a Credit Agreement (the "Credit
Agreement") by and between the Borrower; SOCIETE GENERALE, a
French banking corporation acting through its Southwest
Agency, as Structuring Agent (the "Structuring Agent"); BANK
ONE, TEXAS, N.A., as Administrative Agent (the
"Administrative Agent"); and the banks and other financial
institution party thereto (collectively referred to herein
as the "Banks").
Gentlemen:
In connection with the Credit Facility, we have acted as special
Wisconsin counsel to Madison Motel Associates, a Wisconsin general partnership
("Mortgagor"). The Credit Facility is evidenced, in part, by certain promissory
notes (the "Notes") executed by the Borrower and payable to the Banks, the
Credit
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 2
Agreement, the documents described below and the other documents executed in
connection with the Credit Facility (collectively, the "Credit Documents"). The
Mortgagor is leasing certain real and personal property (the "Property") to AGH
Leasing, L.P., a Delaware limited partnership ("Lessee") pursuant to a Lease
Agreement (the "Lease") between such parties. The real property is located in
the County of Dane (the "County") and the State of Wisconsin (the "State").
1. DOCUMENTS REVIEWED. For purposes of this opinion (the "Opinion
------------------
Letter"), we have examined the following documents, all of which are dated July
___, 1996, unless otherwise specified:
(a) Mortgage, Security Agreement, Assignment of Rents and
Financing Statement (the "Mortgage"), executed by the Mortgagor,
securing payment of the Notes, covering the Property;
(b) Assignment of Leases, Rents and Security Deposits (the
"Mortgagor Assignment of Leases"), executed by the Mortgagor, further
securing payment of the Notes;
(c) UCC Financing Statements executed by the Mortgagor to be
filed in the real property records (the "Records") for the County and
with the Department of Financial Institutions Division of Corporate &
Consumer Services, Uniform Commercial Code Unit (the "Department") of
the State (respectively, the "Mortgagor County Financing Statement"
and the "Mortgagor State Financing Statement" and collectively the
"Mortgagor Financing Statements");
(d) Assignment of Leases, Rents and Security Deposits (the
"Lessee Assignment of Leases"), executed by the Lessee in favor of the
Mortgagor securing the Lessee's obligations under the Lease; and
(e) UCC Financing Statements executed by the Lessee to be filed
in the Records and with the Department (respectively, the "Lessee
County Financing Statement" and the "Lessee State Financing Statement"
and collectively the "Lessee Financing Statements").
For purposes of this Opinion Letter, the Mortgage and the Mortgagor Assignment
of Leases are hereinafter collectively referred to as the "Security Documents".
All of the documents described in clauses (a)-(e) above and executed by the
Mortgagor or the Lessee
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 3
are hereinafter collectively referred to as the "Executed Documents."
2. OPINIONS. Subject to the matters set forth in subsequent
--------
portions of this Opinion Letter, it is our opinion that:
(a) Each of the Security Documents constitutes the legal, valid
and binding obligation of the Mortgagor, enforceable against the
Mortgagor in accordance with their terms.
(b) The Lessee Assignment of Leases constitutes the legal, valid
and binding obligation of the Lessee, enforceable against the Lessee
in accordance with its terms.
(c) The Mortgage and the Mortgagor County Financing Statement
are in proper form for filing in the Records, and the Mortgagor State
Financing Statement is in proper form for filing with the Department.
Upon the recording of the Mortgage and the Mortgagor County Financing
Statement in the Records, and upon the filing of the Mortgagor State
Financing Statement with the Department, no other recording, filing or
other action under the laws of the State is required in order to
perfect (a) the lien in the real estate which is encumbered by the
Mortgage; (b) the security interest in the fixtures; and (c) the
security interest in the collateral described in the Mortgagor
Financing Statements but only to the extent such collateral is located
in the State, is subject to Article 9 of the Uniform Commercial Code
as in force in Wisconsin (the "UCC") and only to the extent a security
interest in such collateral can be perfected by filing in the Records
or with the Department.
(d) Upon proper filing of the Mortgagor County Financing
Statement in the Records and the Mortgagor State Financing Statement
with the Department, the "Said Indebtedness" under the Mortgage will
be secured by a validly created, perfected security interest in favor
of the Administrative Agent for the benefit of the Banks in and to all
the right, title and interest of the Mortgagor in and to such portion
of the collateral described in the Mortgagor Financing Statements
which is located in the State, is subject to Article 9 of the UCC and
which can be perfected by filing in the Records or with the
Department, and upon the proper filing of the Mortgage and the
Mortgagor County Financing Statement in the
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 4
Records, the "Said Indebtedness" under the Mortgage will be secured by
a validly created, perfected mortgage lien in favor of the
Administrative Agent for the benefit of the Banks in and to all the
right, title and interest of the Mortgagor in and to the real property
and fixtures described in the Mortgage.
(e) The Lessee County Financing Statement is in proper form for
filing in the Records, and the Lessee State Financing Statement is in
proper form for filing with the Department. Upon the recording of the
Lessee County Financing Statement in the Records and upon the filing
of the Lessee State Financing Statement with the Department, no other
recording, filing or other action under the laws of the State is
required in order to perfect the liens in the property described
therein to the extent that the collateral is located in the State and
is of a type which is subject to Article 9 of the UCC and which can be
perfected by filing in the Records or with the Department.
(f) Upon proper filing of the Lessee County Financing Statement
in the Records and the Lessee State Financing Statement with the
Department, the Lessee's obligations under the Lease will be secured
by a validly created, perfected security interest in favor of the
Mortgagor in and to all the right, title and interest of the Lessee in
and to the collateral described in the Lessee Financing Statements, to
the extent (a) the Lease is a valid and binding obligation of Lessor
and Lessee, enforceable against each in accordance with its terms; (b)
the Lease grants an effective and enforceable security interest to
Mortgagor in the collateral described in the Lessee Financing
Statements; (c) such collateral is located in the State; and (d) the
collateral is of a type which is subject to Article 9 of the UCC and
which can be perfected by filing in the Records or with the
Department. We also recommend recording the Lessee Assignment of
Leases in the Records so as to perfect the interest secured thereby to
the extent it constitutes an interest in real estate not governed by
Article 9 of the UCC.
(g) There are no stamp, recording or similar taxes required to
be paid in connection with the execution, delivery, recording or
enforcement of the Mortgage except for nominal recording and filing
fees.
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 5
(h) The Lessee is registered to transact business in the State
as a foreign limited partnership under the name AGH Leasing, Limited
Partnership.
(i) Based on adherence to existing judicial precedents under
State law, except for those matters under the Security Documents
related to the perfection of liens on and security interests in real
estate, fixtures and personal property and the exercise of remedies
against such collateral, a State court would hold that the choice of
Texas law to govern the construction and interpretation of the
provisions of the Executed Documents, including without limitation
those provisions related to usury, would be enforceable.
(j) The Mortgagor is duly formed, validly existing and
authorized to do business in the State. The Mortgagor has the
requisite power and authority to own its assets, to transact the
business in which it will be engaged in connection with the Property,
to execute and deliver the Executed Documents in the capacity therein
stated, and to perform its obligations under the Security Documents.
(k) Based on the attached resolutions and officer's certificate,
Mortgagor has taken all partnership action necessary to authorize the
execution and delivery of the Executed Documents.
3. ASSUMPTIONS. In delivery of the opinions expressed in Section 2
-----------
above, we have assumed the following:
(a) CAPACITY. The legal capacity of each individual signing one
--------
or more of the Executed Documents or other documentation upon which
this Opinion Letter has been based.
(b) BANKS' AUTHORITY. The Banks are authorized to make the
----------------
Credit Facility in accordance with the Credit Documents. The Credit
Documents, and the transactions evidenced thereby, are valid, binding
and enforceable with regard to the Banks and/or any other parties
executing the Credit Documents (other than the Mortgagor and the
Lessee to the extent to which we are opining as to the Security
Documents as provided in Section 2(a) and as to the Lessee Assignment
of Leases as provided in Section 2(b) above) and all of such parties
hold all necessary licenses, permits and approvals to engage in
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 6
the subject transactions and have complied with all applicable laws,
rules, regulations and orders in connection with, and which allows
them to engage in, the subject transactions.
(c) MORTGAGOR'S AND LESSEE'S AUTHORITY. The Lessee is duly
----------------------------------
formed, validly existing, and authorized to do business and in good
standing under the laws of its state of creation. The Lessee has the
requisite partnership power and authority, and all necessary
corporate, partnership or other organizational actions of its partners
have been taken by each of them to allow them to authorize the
partnership, to own its assets, to transact the business in which it
will be engaged in connection with the Property, to execute and
deliver the Lessee Assignment of Leases in the capacity therein
stated, and to perform its obligations under the Lessee Assignment of
Leases. Each of the general partners of the Mortgagor has the
requisite power and authority, and all necessary corporate,
partnership or other organizational actions have been taken by each of
them to allow them to authorize the Mortgagor, to own its assets, to
transact the business in which it will be engaged in connection with
the Property, to execute and deliver the Executed Documents and to
perform its obligations thereunder. Each of the Executed Documents has
been duly executed and delivered by the Lessee and the Mortgagor.
(d) GENUINENESS AND AUTHENTICITY. All signatures appearing on
----------------------------
all Executed Documents are genuine; all documents and records
submitted to us as originals are authentic; all documents and records
submitted to us as copies conform to the corresponding original
documents and records; and all statements of fact therein are true.
(e) CONTACTS. Substantial negotiations for the Credit Facility
--------
and the closing of the Credit Facility occurred in Texas. The
Structuring Agent's, the Administrative Agent's and the Borrower's and
Lessee's principal place of business is in Texas. The Credit Facility
will be funded out of New York. Repayments under the Credit Facility
will be made in Texas.
(f) CERTIFICATES OR STATEMENTS OF PUBLIC OFFICIALS. Certificates
----------------------------------------------
or statements of public officials, corporate and partnership documents
and records and other certificates and instruments we have deemed
relevant and
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 7
necessary as a basis for our opinion hereinafter are true and correct,
have not been modified or rescinded and have been properly issued or
adopted, as the case may be.
(g) ACCURACY OF FINANCING STATEMENTS. Each of the financing
--------------------------------
statements as to which we are opining contain an address of the
secured party from which information regarding the secured party's
security interest can be obtained; the debtor under each such
financing statement has rights in the collateral; Dane County,
Wisconsin is the only county in which any real property in which any
goods that are or are to become fixtures are or will be located; the
financing statements and the Mortgage each contain the correct legal
description and tax key number of the real property intended to be
described by the parties and on which all fixtures are located and the
correct name or names of the record owner or owners of the real
property described therein; and the financing statements each contain
an accurate and sufficient description of property as to which the
debtor has granted a security interest.
(h) LACK OF OTHER AGREEMENTS. There are no oral or written
------------------------
agreements or understandings or usage of trade or course of conduct or
other prior dealings among the parties that would limit, expand or
otherwise modify the respective rights and obligations of the parties,
as set forth in the Executed Documents, or that would have an effect
on the opinions expressed herein; there are no judgments, decrees,
orders, agreements or the like that impair or limit the ability of any
party thereto to enter into, execute and deliver, and perform, observe
and be bound by the Executed Documents and the transactions
contemplated thereby.
(i) OTHER CREDIT DOCUMENTS. All of the Credit Documents, other
----------------------
than the Executed Documents, are valid and binding agreements
enforceable against all of the parties thereto in accordance with
their terms. We have not been provided, nor have we reviewed, any of
such Credit Documents other than the Executed Documents and we do not
express any opinion as to any such documents nor do we express any
opinion on the Executed Documents to the extent that they incorporate
by reference any of the Credit Documents.
(j) ADEQUATE CONSIDERATION. Each of the parties to the Executed
----------------------
Documents who is granting a mortgage or
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 8
security interest has received adequate consideration in return for
the granting of such interest and the Mortgagor and the Borrower have
a sufficient relationship between them, contractual or otherwise, to
warrant the Mortgagor granting the security interest created by the
Security Documents to secure the Borrower's obligation.
(k) CONSENTS AND APPROVALS. The consent and/or approval of any
----------------------
third party required for any of the parties to the Credit Documents to
perform their obligations has been obtained.
4. QUALIFICATIONS. The opinions expressed in Section 2 above are
--------------
subject to the following qualifications.
(a) SPECIFIED LAWS. The opinions contained in Section 2 as to
--------------
the enforceability of the Security Documents and the Lessee Assignment
of Leases are subject to the qualification that enforcement of the
Security Documents and the Lessee Assignment of Leases is further
subject to the following: (i) the rights of the United States under
the Federal Tax Lien Act of 1966, as amended; (ii) the effect of
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance, the doctrine of commercial reasonableness, and other laws
affecting the rights of creditors and/or the collection of debtor's
obligations generally; and (iii) principles of equity and/or exercise
of judicial discretion in accordance with principles of equity, which
may limit the availability of certain equitable remedies. As noted
above, enforceability of the Lessee Assignment of Leases is further
dependent on enforceability of the Lease, as to which we do not opine.
(b) GENERAL LAWS. The opinions contained in Section 2 as to the
------------
enforceability of the Security Documents and the Lessee Assignment of
Leases are further subject to the qualification that the
enforceability of certain of the remedial, waiver and enforcement
provisions of the Security Documents and the Lessee Assignment of
Leases are subject to other applicable laws, rules and regulations in
addition to those described in subsection 4(a) above; however, such
laws, in our opinion, should not substantially interfere with the
practical realization of the benefits expressed in the Security
Documents and the Lessee Assignment of Leases, except for the economic
consequences of any procedural delay which may result from such laws,
rules
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 9
and regulations. We express no opinion regarding the enforceability of
provisions relating to prepayment penalties and late payment fees,
grant of power of attorney or other executing authority to lenders,
the establishment of fiduciary relationships, the enforcement of due
on encumbrance or due on transfer provisions (except as to those
provisions relating to the sale of the encumbered real property
itself), obligations of indemnification or contribution, consent to
service and venue and waiver of trial by jury, or right to appointment
of a receiver as a matter of right.
(c) ASSIGNMENTS OF LEASES. Until recently we were unable to
---------------------
provide lenders with an enforceability opinion as to assignments of
leases and rents as there was no statutory law of Wisconsin directly
on point with respect thereto. Case law of Wisconsin appeared to
dictate that perfection of an assignment of rents may occur only upon
possession of the rent-producing property by the secured party, either
by a peaceable yielding of possession or the appointment of a
receiver, or the happening of a specific triggering event clearly
expressed in the assignment documents. In the most recent case on this
subject, the court in The Matter of Century Investment Fund VIII
------------------------------------------
Limited Partnership, 937 ▇.▇▇ ▇▇▇ (▇▇▇ ▇▇▇., ▇▇▇▇), in applying
-------------------
Wisconsin law, held that an assignment of rents is perfected upon the
filing of a foreclosure action and a motion for the appointment of a
receiver, provided that the assignment specifically provides for
entitlement to rents and leases upon default.
A State statute, which has only recently been enacted, provides
that (i) an assignment of rents (including an assignment of rents
contained in a mortgage) is effective against the assignor upon
execution and delivery to the assignee, and (ii) the assignment is
perfected as to all subsequent purchasers, mortgagees, lien creditors
and other third parties, for all purposes, from the time and date of
recording the assignment with the register of deeds for the county in
which the affected real property is located. Wis. Stat. (S) 708.11.
While the statute adds a degree of certainty to the assignment of
rents area, it has not been tested in the State courts.
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 10
5. LIMITATIONS. This Opinion Letter is issued subject to the
-----------
following limitations:
(a) LICENSED ONLY IN WISCONSIN. We are licensed to practice law
--------------------------
only in the State of Wisconsin and we express no opinion with respect
to the effect of any laws other than the laws of the State of
Wisconsin and laws of the United States of general application to
transactions in the State of Wisconsin.
(b) SUBSEQUENT EVENTS. We undertake no obligation to advise you
-----------------
of facts or changes in law occurring after the date of this Opinion
Letter which might affect the opinions expressed herein.
(c) CAPTIONS. The captions in this Opinion Letter are for
--------
convenience of reference only and shall not limit, amplify or
otherwise modify the provisions hereof.
(d) NO IMPLIED OPINIONS. This Opinion Letter is limited to the
-------------------
matters expressly set forth herein, and no opinion is to be implied or
may be inferred beyond the matters expressly so stated herein.
(e) FINANCIAL INFORMATION. We have made no examination or
---------------------
investigation to verify the truth, accuracy, or completeness of any
financial, accounting or statistical information furnished to the
Banks and express no opinion with respect thereto.
(f) TITLE AND PRIORITY ISSUES. We express no opinion as to
-------------------------
matters of title or priority or perfection of liens or security
interests (except to the limited extent concerning perfection as set
forth in Sections 2(c), (d), (e) and (f), above). We understand that,
with respect to the real and personal property security interest
intended to be created by the Executed Documents and the priority of
the liens thereof, you will rely on a title insurance policy and such
Uniform Commercial Code and other searches as you deem adequate, and,
accordingly, we express no opinion as to such matters.
(g) RESTRICTION ON USE. This Opinion Letter is furnished to you
------------------
and the other Banks and your and the other Banks' respective counsel
and is solely for your and the other Banks' benefit, and may not be
relied upon by, nor copies delivered to, any other person without our
prior written consent except for further Banks or
Southwest Agency
Bank One, Texas, N.A.
July ____, 1996
Page 11
participants in the Credit Facility and their counsel or any other
counsel rendering an opinion in connection with the Credit Documents
or any of the transactions described therein.
Very truly yours,
/s/ ▇▇▇▇▇ & ▇▇▇▇▇▇▇ (HLT)
▇▇▇▇▇ & LARDNER
MADISON MOTEL ASSOCIATES
CERTIFICATE
TO
▇▇▇▇▇ & ▇▇▇▇▇▇▇
The undersigned, ▇▇▇▇▇ ▇▇▇▇▇, on behalf of American General
Hospitality Corporation, a Maryland corporation ("AGHC"), and AGH GP, Inc., a
Nevada corporation ("AGHGP"), hereby certifies and represents to ▇▇▇▇▇ &
▇▇▇▇▇▇▇, for the purpose of enabling ▇▇▇▇▇ & Lardner to render various opinions
in connection with certain matters involving or relating to Madison Motel
Associates, a Wisconsin general partnership ("MMA"), as follows:
1. He is the duly elected, qualified, and acting Chairman of the
Board, Chief Executive Officer and President of AGHC and AGHGP.
2. AGHGP is and has always been the sole general partner of American
General Hospitality Operating Partnership, L.P., a Delaware limited partnership
(the "Operating Partnership"); immediately prior to the consummation of the
transactions contemplated by the Sale and Contribution Agreement dated April 30,
1996 (the "Sale and Contribution Agreement"), by and among Madison Motor Inns,
Inc., a Delaware corporation ("CSI"), American General Hospitality, Inc., a
Texas corporation, the Operating Partnership, and AGHGP, AGH LP, Inc., a Nevada
corporation ("AGHLP"), was the sole limited partner of the Operating
Partnership.
3. AGHC is a 1% member of AGH UPREIT LLC, a Delaware limited
liability company ("AGHLLC"); the Operating Partnership is a 99% member of
AGHLLC; AGHC and the Operating Partnership are and have always been only members
of AGHLLC; and, no person or entity other than the Operating Partnership or AGHC
has any voting power or control with respect to AGHLLC.
4. Immediately following the consummation of the transactions
contemplated by the Sale and Contribution Agreement and as of the date hereof,
the Operating Partnership and AGHLLC are the only general partners of MMA and no
other person or entity has any voting power or control with respect to MMA; and,
to the best of my knowledge, immediately prior to the consummation of the
transactions contemplated by the Sale and Contribution Agreement, the only
general partners of MMA were MMI and CSI and no other person or entity had
voting power or control with respect thereto.
5. On the date hereof and at all times prior thereto, the duly
elected, qualified, and acting sole director of both AGHLP and AGHGP is and has
been ▇▇▇▇▇▇ ▇. ▇▇▇▇▇.
6. On the date hereof and since July 15, 1996, the following persons
are and have been since such date the duly elected, qualified, and acting
directors of AGHC:
▇. ▇▇▇▇▇ Lodge III
▇▇▇▇▇ ▇. Worms
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Prior thereto, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ had been the sole director of AGHC.
7. On the date hereof, the following persons hold the office or
offices in AGHC, AGHGP, and AGHLP, which are set forth opposite his name:
Name Office(s)
---- ---------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Chairman of the Board, Chief
Executive Officer, and President
▇▇▇▇▇ ▇. ▇▇▇▇▇ Executive Vice President
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Executive Vice President, Chief
Financial Officer, Principal
Accounting Officer, Secretary,
and Treasurer
8. As of the date hereof, neither the stockholders nor the board of
directors of AGHC have adopted, or are currently considering adopting, a
resolution contemplating the dissolution of AGHC or AGHLLC or any merger or
consolidation of AGHC or AGHLLC with another entity in which AGHC or AGHLLC, as
the case may be, has not been or will not be the surviving entity, and there
have been no articles or certificate of dissolution filed on behalf of AGHC or
AGHLLC with the Maryland Secretary of State or Delaware Secretary of State, as
the case may be.
9. As of the date hereof, the undersigned has no knowledge or notice
that either the members or managers, if any, of AGHLLC have adopted, or are
currently considering adopting, a resolution contemplating the dissolution of
AGHLLC or any merger or consolidation of AGHLLC with another entity in which
AGHLLC has not been or will not be the surviving entity, and there have been no
articles or certificate of dissolution filed on behalf of AGHLLC with the
Delaware Secretary of State.
10. The undersigned has no knowledge or notice that any member of
AGHLLC has retired or resigned or been expelled as a member of AGHLLC, is
bankrupt (as that term is defined and used in the Operating Agreement of AGHLLC
and applicable laws of the State of Delaware), has died or been dissolved, or
been subject to the
-2-
occurrence of any other event that would cause a dissolution of AGHLLC under the
laws of the State of Delaware.
11. Attached hereto as Exhibit A is a true, correct, and complete
---------
copy of the Second Amended and Restated Agreement of Partnership of MMA, which
immediately following the consummation of the transactions contemplated by the
Sale and Contribution Agreement and on the date hereof is in full force and
effect, and no proceeding for the amendment, modification, or rescission of such
document is pending or contemplated; and attached hereto as Exhibit A-1 is a
-----------
true, correct, and complete copy of the Amended and Restated Agreement of
Partnership of MMA in full force and effect immediately prior to the
consummation of the transactions contemplated by the Sale and Contribution
Agreement, which Amended and Restated Agreement of Partnership was superseded
and replaced on the date hereof upon execution and delivery by the Operating
Partnership and AGHLLC of the Second Amended and Restated Agreement of
Partnership attached hereto as Exhibit A.
---------
12. As of the date hereof, neither the stockholders nor the board of
directors of AGHGP have adopted or currently considered adopting a resolution
contemplating the dissolution of AGHGP or the Operating Partnership or any
merger or consolidation of AGHGP or the Operating Partnership with another
entity in which AGHGP or the Operating Partnership, as the case may be, has not
been or will not be the surviving entity, and there have been no articles or
certificate of dissolution filed on behalf of AGHGP or the Operating Partnership
with the Nevada Secretary of State or Delaware Secretary of State, as the case
may be.
13. As of the date hereof, AGHGP is not bankrupt (as that term is
defined and used in the limited partnership agreement of the Operating
Partnership and applicable laws of the State of Delaware) and has not withdrawn
or been expelled or removed as the general partner of the Operating Partnership,
and the undersigned has no knowledge or notice that any of the other partners of
the Operating Partnership, if any, are bankrupt or have withdrawn or been
expelled or removed as general partners of the Operating Partnership, and the
undersigned has no knowledge or notice of the occurrence of any other events or
circumstances which would result in the dissolution of the Operating Partnership
under its limited partnership agreement or the laws of the State of Delaware.
14. As of the date hereof, neither AGHLLC nor the Operating
Partnership is bankrupt (as that term is defined and used in the Second Amended
and Restated Agreement of Partnership of MMA and applicable laws of the State of
Wisconsin) or has withdrawn or been expelled or removed as a general partner of
MMA, and the undersigned has no knowledge or notice of the occurrence of any
other events or circumstances which would result in the dissolution
-3-
of MMA under its Second Amended and Restated Agreement of Partnership or the
laws of the State of Wisconsin.
15. Attached hereto as Exhibit B is a true, correct, and complete
---------
copy of the resolutions adopted by the general partners of MMA, at duly called
meetings at which a quorum was present (if required) or upon unanimous written
consent, on connection with matters involving or relating to MMA, which
resolutions remain in full force and effect as of the date hereof and have not
been amended, modified, revoked, or rescinded.
16. To the best of my knowledge, no authorization, consent, or
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required to be obtained or made by MMA for the
due execution, delivery, and performance by it of that certain Lease Agreement
dated July _____, 1996, by and between MMA and AGH Leasing, L.P., a Delaware
limited partnership, relating to the Holiday Inn Select-Madison, and the
consummation of the transactions contemplated thereby, except such as have been
duly obtained or made and are in full force and effect on the date hereof.
IN WITNESS WHEREOF, the undersigned has executed this certificate as
of the ____ day of July, 1996.
________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Chairman of the Board,
Chief Executive Officer and
President of American General
Hospitality Corporation and
AGH GP, Inc.
-4-
The undersigned, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, the Executive Vice President, Chief
Financial Officer, Principal Accounting Officer, Secretary, and Treasurer of
both AGHC and AGHGP hereby certifies that ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ was, at the time he
executed the foregoing certificate, a duly elected, qualified, and acting
Chairman of the Board, Chief Executive Officer and President of both AGHC and
AGHGP, and he was duly authorized and empowered to do so, and the signature
thereon is genuine.
______________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Executive Vice-President,
Chief Executive Officer,
Principal Accounting Officer,
Secretary and Treasurer and
President of American General
Hospitality Corporation and
AGH GP, Inc.
-5-
Exhibit B
Resolutions Adopted by the Partners
-----------------------------------
of Madison Motel Associates ("MMA")
-----------------------------------
RESOLVED, that the form, terms, and provisions of the Lease Agreement
dated July ____, 1996 (the "Holiday Inn Select-Madison Participating
Lease"), by and between MMA and AGH Leasing, L.P., a Delaware limited
partnership, be, and the same hereby is, approved in all respects; and be
it further
RESOLVED, that American General Hospitality Operating Partnership,
L.P., a Delaware limited partnership, and AGH UPREIT LLC, a Delaware
limited liability company (collectively, the "Partners"), be, and each of
them hereby is, authorized in the capacity of general partners of MMA, to
execute and deliver the Holiday Inn Select-Madison Participating Lease on
behalf of MMA, with such additions, deletions, and changes in the final
executed copies as the Partners may approve, such approval to be
conclusively evidenced by the execution and delivery thereof; and be it
further
RESOLVED, that the form, terms, and provisions of the Loan Documents
identified on Schedule I attached hereto be, and the same hereby is
approved in all respects in their entirety; and be it further
RESOLVED, that the Partners be, and each of them hereby is, authorized
in the capacity of general partners of MMA, to execute and deliver the Loan
Documents on behalf of MMA, with such additions, deletions and changes in
the final executed copy as the Partners may approve, such approval to be
conclusively evidenced by the execution and delivery thereof; and be it
further
RESOLVED, that the form, terms and provisions of the financing
statements on Form UCC-1 to be filed pursuant to the Loan Documents (the
"UCC-1 Financing Statements"), are hereby in all respects approved; and be
it further
RESOLVED, that the Partners be, and each of them hereby is, authorized
and empowered to execute and deliver in the capacity of general partners of
MMA, the UCC-1 Financing Statements on behalf of MMA (with such additions,
deletions and changes in the final executed copy as the Partners shall, in
their discretion, deem advisable, such execution to be conclusive evidence
of his approval); and be it further
RESOLVED, that the Partners be, and each of them hereby is, authorized
in the capacity of general partners of MMA, to execute and deliver on
behalf of MMA, such further documents, instruments and agreements as the
Partners may deem necessary or appropriate in connection with the Loan
Documents, including any bills of sale, assignments, assumptions,
certificates, affidavits, deeds and such other documents, instruments and
agreements as may be required by any party to the Loan Documents.
Schedule 1
1. Credit Agreement (the "Credit Agreement"), by and between American
General Hospitality Operating Partnership, L.P., a Delaware limited partnership
(the "Operating Partnership"), Societe Generale, a French banking corporation.
Bank One Texas, N.A., and certain other banks and other financial institutions
(collectively, the "Banks"), relating to a $100,000,000.00 credit facility (the
"Credit Facility").
2. Certain promissory notes (the "Notes") executed by the Operating
Partnership and payable to the Banks, evidencing the obligations of the
Operating Partnership under the Credit Facility.
3. Mortgage, Security Agreement, Assignment of Rents and Financing
Statement (the "Mortgage"), executed by Madison Motel Associates, a Wisconsin
general partnership ("MMA"), securing payment of the Notes, covering certain
real and personal property.
4. Assignment of Leases, Rents and Security Deposits (the "Mortgagor
Assignment of Leases"), executed by MMA, further securing payment of the Notes.
5. UCC Financing Statements executed by MMA to be filed in the real
property records (the "Records") for Dane County, Wisconsin, and with the
Department of Financial Institutions, Division of Corporate & Consumer Services,
Uniform Commerical Code Unit (the "Department") of the State of Wisconsin
(respectively, the "Mortgagor County Financing Statement" and the "Mortgagor
State Financing Statement" and collectively the "Mortgagor Financing
Statements").
6. Assignment of Leases, Rents and Security Deposits (the "Lessee
Assignment of Leases"), executed by AGH Leasing, L.P., a Delaware limited
partnership (the "Lessee"), in favor of MMA securing the Lessee's obligations
under the Lease.
7. UCC Financing Statements executed by the Lessee to be filed in the
Records and with the Department (respectively, the "Lessee County Financing
Statement" and the "Lessee State Financing Statement" and collectively the
"Lessee Financing Statements").
EXHIBIT "JJ"
[LETTERHEAD OF MACDONALD CARANO ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇]
▇▇▇ ▇. ▇▇▇▇▇▇ Reply to: Reno
July 31, ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ Tower
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Societe Generale
Southwest Agency
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Bank One, Texas, N.A.
Real Estate Department
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Re: American General Hospitality Corporation
Gentlemen:
We are special local counsel for AGH GP, Inc., a Nevada corporation,
in connection with the Credit Facility (the "Credit Facility") of up to $100
million to American General Hospitality Operating Partnership, L.P., a Delaware
limited partnership (the "Borrower") pursuant to a Credit Agreement (the "Credit
Agreement") by and between the Borrower and Societe Generale, a French banking
corporation acting through its Southwest Agency, as Structuring Agent (the
"Structuring Agent"); Bank One, Texas, N.A., as Administrative Agent (the
"Administrative Agent"); and the banks and other financial institutions party
thereto (collectively referred to herein as the "Banks").
In connection with this opinion, we have examined and relied upon
originals or copies, certified or otherwise identified to our satisfaction, of:
a. Articles of Incorporation of AGH GP, Inc.;
b. List of Officers and Directors of AGH GP, Inc.;
c. The Amended and Restated Bylaws of AGH GP, Inc.;
d. The consent of special meetings of AGH GP, Inc.;
[LETTERHEAD OF MACDONALD CARANO ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇]
Battle ▇▇▇▇▇▇ LLP
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 2
e. A stock certificate of AGH GP, Inc.;
f. The Subscription Agreement of AGH GP, Inc.;
g. The minutes of AGH GP, Inc. amending the Articles of
Incorporation of AGH GP, Inc.
Our opinion is subject to qualifications that (a) the enforceability
of any instruments referred to herein may be subject to applicable bankruptcy,
insolvency and fraudulent transfer laws, and similar laws affecting the
enforceability of creditor's rights generally, and (b) the remedies of the
parties therein may be qualified by laws governing specific performance,
injunctive relief and other equitable remedies of creditors, and if any party to
any of the documents referred to in this opinion were to seek an equitable
remedy in Nevada, such as specific performance, the availability of such remedy
would be subject to the discretion of the court requested to grant such remedy.
Based upon and subject to the foregoing, it is our opinion, as of the
date hereof:
1. AGH GP, Inc. is a corporation duly incorporated and validly
existing and in good standing under the laws of the State of
Nevada, and is duly registered and qualified to conduct business
and is in good standing, with full corporate power to own, lease
and operate its properties and assets and to conduct its
business.
2. The execution and delivery of and the performance by AGH GP,
Inc., on behalf of American General Hospitality Operating
Partnership, L.P., as its general partner, of its obligations
under the Loan Documents listed on Schedule I to which it is a
party, have been duly and validly authorized.
We are qualified to practice law in the State of Nevada and express no
opinion herein as to any laws other than those of
[LETTERHEAD OF ▇▇▇▇▇▇▇▇ CARANO ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
& ▇▇▇▇▇ LLP]
Battle ▇▇▇▇▇▇ LLP
Societe Generale
Bank One, Texas, N.A.
July 31, 1996
Page 3
the State of Nevada. Our opinion is further limited to laws in affect on
the date hereof.
The opinions rendered herein are delivered solely for Battle
▇▇▇▇▇▇ LLP in giving an opinion to you and the other Banks, and Battle
▇▇▇▇▇▇ LLP may make this letter available to such lenders. In addition,
this opinion is being rendered to the Banks and the Bank's respective
counsel for your and their sole use and may not be made available to or
relied upon by any other person, firm or entity without our express prior
written consent, except for future Banks or participants in the Credit
Facility. This opinion may not be relied on by any other person or in
connection with any other transaction other than those contemplated by
American General Hospitality Corporation Initial Public Offering. No part
of this letter may be quoted or reproduced in any document without our
prior consent. The foregoing shall not prohibit the parties addressed
herein from disseminating this opinion to their attorneys, accountants,
auditors or regulatory examiners.
Sincerely,
▇▇▇▇▇▇▇▇ CARANO ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
By /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇
a Partner
LPB: jab
SCHEDULE 1.01(a)
Commitments
-----------
BANK COMMITMENT
---- ----------
Societe Generale, Southwest Agency $50,000,000
Bank One, Texas, N.A. $50,000,000
[TO BE COMPLETED]
Schedule 1.01(b) - Initial Properties
Allocated Debt Amount, Appraised Values and Cost Basis
Appraised Appraised Allocated
"As Is" "As Improved" Cost Debt
Property Name Location Value Value Basis Amount
------------- ----- ----- ----- ------
LeBaron/Doubletree San Jose, CA 20,000 30,000
Holiday Inn - Mission Valley San Diego, CA 19,400 21,700
Holiday Inn - Crowne Plaza San Jose, CA 15,500 21,000
Holiday Inn - Airport New Orleans, LA 26,000 28,500
Maison de Ville New Orleans, LA 3,000 3,000
▇▇▇▇▇▇▇ ▇▇▇ - ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ 7,500 7,500
Days Inn/Hampton Inn Ocean City, MD 8,000 10,000
Holiday Inn DFW-West Bedford, TX 14,000 14,000
Toledo Hilton Toledo, OH 10,600 10,600
Madison Holiday Inn Madison, WI 21,500 23,000
Best Western ▇▇▇▇▇▇ Albuquerque, NM 12,500 17,500
APPROVED PRELIMINARY PROPERTY PLAN
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A B C D E F G H I J
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1 PROJECTED RENOVATION COSTS
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2 # OF CONSTRUCTION TOTAL PER CHOSEN FRANCHISE PER
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3 PROJECT ROOMS FF/E COST COST COST ROOM UPDATES REQUIRED ▇▇▇ DIFF
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▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇ 231 1,399,977 3,266,613 4,666,590 20,202 - 4,666,590 4,666,590 -
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5 WYNDHAM ALBUQUERQUE 266 1,505,207 3,512,150 5,017,358 18,862 - 5,017,358 5,017,358 -
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6 SECAUCUS 165 - - - - - - - -
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7 TOLEDO 213 102,399 238,932 341,331 1,602 - 341,331 341,331 -
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▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ 227 514,257 1,199,934 1,714,191 7,552 224,250 1,489,941 1,714,191 -
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▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇ 15,000 35,000 50,000 2,174 50,000 - 50,000 -
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10 HOLIDAY INN NEW ORLEANS 304 688,405 1,606,278 2,294,683 7,548 - 2,294,683 2,294,683 -
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11 DFW - WEST 243 72,572 169,335 241,908 996 - 241,908 241,908 -
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12 DFW - SOUTH 409 565,386 1,319,234 1,884,620 4,608 - 1,884,620 1,884,620 0
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13 DOUBLETREE SAN ▇▇▇▇ 327 1,950,000 4,550,000 6,500,000 19,878 - 6,500,000 6,500,000
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14 DOUBLETREE MISSION VALLEY 318 751,432 1,753,340 2,504,772 7,877 - 2,504,772 2,504,772
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▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ 162 571,595 1,333,722 1,905,317 11,761 - 1,905,317 1,905,317
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16 ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ 15,000 35,000 50,000 403 - 50,000 50,000
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17
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18 TOTAL ALL HOTELS 3,012 8,151,231 19,019,538 27,170,769 9,021 274,250 26,896,519 27,170,769 0
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19
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20 TOTAL 4 AGH PREDECESSOR HOTELS 555 102,572 239,335 341,908 616 50,000 291,908
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21
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22 TOTAL 9 ACQUISITION HOTELS 2,457 8,048,658 18,780,203 26,828,861 10,919 224,250 26,604,611
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23
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24 TOTAL 7 ACQUISITION HOTELS 2,832 8,722,653 20,352,856 29,075,509 10,267 224,250 28,851,259
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25
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26 TOTAL 7 CONVERSION HOTELS 1,835 7,380,873 17,222,037 24,602,910 13,408 224,250 24,378,660
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27
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▇▇ ▇▇▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇▇ 1,531 6,692,468 15,615,759 22,308,227 14,571 224,250 22,083,977
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29
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30 TOTAL 7 CONVERSION/2 REPOSITIO 2,243 7,453,445 17,391,372 24,844,818 11,077 224,250 24,620,568
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31
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32
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33 AS OF 6/13/96
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HOLIDAY INN
SAN JOSE, CA
SUMMARY
CROWNE PLAZA CONVERSION
PRODUCT IMPROVEMENT PLAN
JANUARY 26, 1996
--------------------------------------------------------------------------------
EST.COST
--------------------------------------------------------------------------------
I. EXTERIOR 138,000.00
II. BUILDING STRUCTURES 706,500.00
III. PUBLIC AREAS 917,580,00
IV. PRIVATE GUEST AREAS 2,210,965.00
V. BACK OF THE HOUSE 231,090.00
VI. GENERAL CONDITIONS 462,454.85
--------------------------------------------------------------------------------
TOTAL 4,666,589.85
--------------------------------------------------------------------------------
HOLIDAY INN
SAN JOSE, CA
CROWNE PLAZA CONVERSION
PRODUCT IMPROVEMENT PLAN
NUMBER OF ROOMS: 240
---------------------------------------------------------------------------------------------------------------------------------
RE'D QUANTITY/ UNIT EST.
SCOPE OF WORK YES ALLOWANCE COST COST
---------------------------------------------------------------------------------------------------------------------------------
I. EXTERIOR
A. LANDSCAPING:
------------------------------------------------------------------------------------------------------------------------
1. PROVIDE ADDITIONAL COLOR/REPLACE MISSING GROUND COVER 1.00 DEFER 0.00
------------------------------------------------------------------------------------------------------------------------
2. REMOVE OVERGROWN AUSTRALIAN PINES & REPLACE 1.00 DEFER 0.00
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3. PROVIDE ADDITIONAL COURTYARD LANDSCAPING 1.00 DEFER 0.00
------------------------------------------------------------------------------------------------------------------------
4. UPGRADE LIGHTING 1.00 DEFER 0.00
------------------------------------------------------------------------------------------------------------------------
B. PARKING LOT AND DRIVES
------------------------------------------------------------------------------------------------------------------------
1. MINOR ASPHALT REPAIRS 1.00 DEFER 0.00
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2. RESURFACE ASPHALT PAVING 50.00 DEFER 0.00
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3. STRIPE 20.00 DEFER 0.00
------------------------------------------------------------------------------------------------------------------------
4. REFINISH THE FIRE LANE CURBS 1.00 DEFER 0.00
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5. PAINT LIGHT POLES 10.00 DEFER 0.00
------------------------------------------------------------------------------------------------------------------------
C. PARKING GARAGE
------------------------------------------------------------------------------------------------------------------------
1. REFINISH STRIPING THROUGHOUT 260.00 10.00 DEFER
------------------------------------------------------------------------------------------------------------------------
2. REFINISH OR REPLACE CEILING LIGHTS 60.00 200.00 DEFER
------------------------------------------------------------------------------------------------------------------------
3. PAINT POLES ON POLE LIGHTS 10.00 350.00 DEFER
------------------------------------------------------------------------------------------------------------------------
4. REFINISH STRWY RAIL & PROVIDE PART ENCLOSURE 2.00 2,500.00 DEFER
------------------------------------------------------------------------------------------------------------------------
5. REPLACE AND UPGRADE GLOBE LIGHT FIXTURES 30.00 75.00 DEFER
------------------------------------------------------------------------------------------------------------------------
6. REPLACE SCARRED SIGNAGE THROUGHOUT 1.00 1,500.00 DEFER
------------------------------------------------------------------------------------------------------------------------
7. REFINISH/UPGRADE ELEV FLOOR, WALLS, CEILING, DOORS 1.00 3,000.00 DEFER
------------------------------------------------------------------------------------------------------------------------
8. RENOVATE ELEVATOR TO ADA STANDARDS 1.00 10,000.00 DEFER
------------------------------------------------------------------------------------------------------------------------
9. ENTRY DEVICES AND ATTENDANTS BOOTH 1.00 5,000.00 DEFER
------------------------------------------------------------------------------------------------------------------------
11. REPLACE VANS 2.00 24,000.00 48,000.00
------------------------------------------------------------------------------------------------------------------------
12. UPGRADE GARAGE TO MATCH HOTEL EXTERIOR 1.00 40,000.00 40,000.00
------------------------------------------------------------------------------------------------------------------------
D. SIGNAGE
------------------------------------------------------------------------------------------------------------------------
1. BRAND REQUIRED SIGNAGE 1.00 50,000.00 50,000.00
------------------------------------------------------------------------------------------------------------------------
II. BUILDING STRUCTURES
A. COMMERCIAL BUILDING CANOPY
------------------------------------------------------------------------------------------------------------------------
1. REPAIR CRACKED CANOPY CEILING 1.00 3,500.00 3,500.00
------------------------------------------------------------------------------------------------------------------------
2. UPGRADE CANOPY AND ENTRY 1.00 20,000.00 20,000.00
------------------------------------------------------------------------------------------------------------------------
B. COMMERCIAL BUILDINGS
------------------------------------------------------------------------------------------------------------------------
1. REFINISH EXTERIOR WALLS WHERE STAINED SEE #5
------------------------------------------------------------------------------------------------------------------------
2. REFINISH WHERE LIGHT FIXTURES HAVE BEEN CHANGED SEE #5
------------------------------------------------------------------------------------------------------------------------
3. STEAM CLEAN PAVERS UNDER CANOPY 1.00 500.00 500.00
------------------------------------------------------------------------------------------------------------------------
Page 2
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4. PROVIDE NEW ROOFLINE DETAIL 4,000.00 10.00 40,000.00
--------------------------------------------------------------------------------------------------------------------------
5. CHANGE EXTERIOR COLOR/SKIN TO COORDINATE W/RENTAL TOWER 1.00 90,000.00 90,000.00
--------------------------------------------------------------------------------------------------------------------------
6. REFINISH CONCRETE PLANTERS 1.00 7,500.00 7,500.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE BRONZE WINDOWS AT STREET LEVEL TO
COORDINATE WITH BUILDING RENOVATION 1.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
8. PROVIDE NEW DECORATIVE EXTERIOR LIGHTING 1.00 20,000.00 20,000.00
--------------------------------------------------------------------------------------------------------------------------
9. PROVIDE FLAG POLES 2.00 1,200.00 2,400.00
--------------------------------------------------------------------------------------------------------------------------
10. REPLACE WASTE RECEPTACLES 6.00 350.00 2,100.00
--------------------------------------------------------------------------------------------------------------------------
C. RENTAL UNIT BUILDING
--------------------------------------------------------------------------------------------------------------------------
1. CLEAN DEBRIS FROM ROOF AND REFINISH EQUIPMENT 1.00 5,500.00 5,500.00
--------------------------------------------------------------------------------------------------------------------------
2. UPGRADE SKIN TO CONCEAL PANELS AT WINDOWS 1.00 440,000.00 440,000.00
--------------------------------------------------------------------------------------------------------------------------
3. MANSARD OR PARAPET ROOF TREATMENT 1.00 75,000.00 75,000.00
--------------------------------------------------------------------------------------------------------------------------
III. PUBLIC AREAS
A. LOBBY
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH LOBBY VESTIBULE DOORS 2.00 1,250.00 2,500.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE CRACKED MARBLE TILES IN VESTIBULE FLOOR 1.00 2,000.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE SIGN PACKAGE INCL IN ROOM 0.00
--------------------------------------------------------------------------------------------------------------------------
4. PROVIDE CURRENCY EXCHANGE INFO AT FRONT DESK 1.00 50.00 50.00
--------------------------------------------------------------------------------------------------------------------------
6. CONVERT GIFT SHOP TO LOBBY LOUNGE MINIMUM SEATING 20 1.00 25,000.00 25,000.00
--------------------------------------------------------------------------------------------------------------------------
8. RELOCATE ▇▇▇▇ STORAGE TO BEHIND FRONT DESK 1.00 2,500.00 2,500.00
--------------------------------------------------------------------------------------------------------------------------
9. RAISE AND ▇▇▇▇▇▇ LOBBY CEILING IF POSSIBLE 1.00 15,000.00 15,500.00
--------------------------------------------------------------------------------------------------------------------------
10. INSTALL NEW DECORATIVE LIGHTING IN LOBBY CEILING 1.00 7,500.00 7,500.00
--------------------------------------------------------------------------------------------------------------------------
11. REPLACE VINYL WALL COVERING THROUGHOUT LOBBY 1.00 5,000.00 5,000.00
--------------------------------------------------------------------------------------------------------------------------
12. REPLACE WORN CARPET IN LOBBY ONLY 350.00 25.00 8,750.00
--------------------------------------------------------------------------------------------------------------------------
13. INSTALL SLIP RESISTANT GRANITE MATERIAL IN ENTRY OF LOBBY 800.00 20.00 16,000.00
--------------------------------------------------------------------------------------------------------------------------
14. REFINISH DOOR AND DOORWAYS THROUGHOUT 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
15. REFINISH OAK BASE AND TRIM IN LOBBY, DESK AND CORRIDOR 1.00 5,000.00 5,000.00
--------------------------------------------------------------------------------------------------------------------------
16. REPLACE UPHOLSTERED SEATING 1.00 25,000.00 25,000.00
--------------------------------------------------------------------------------------------------------------------------
17. REDESIGN/RELOCATE PUBLIC PHONE AREA 1.00 5,000.00 5,000.00
--------------------------------------------------------------------------------------------------------------------------
18. PROVIDE MINIMUM OF ONE HOUSE PHONE 1.00 75.00 75.00
--------------------------------------------------------------------------------------------------------------------------
19. REPLACE BELLSTAND WITH LOWER CONCIERGE DESK 1.00 1,500.00 1,500.00
--------------------------------------------------------------------------------------------------------------------------
20. REPLACE CARPET ON DESK FACIA 1.00 3,000.00 3,000.00
--------------------------------------------------------------------------------------------------------------------------
21. REPLACE CARPET BEHIND THE DESK 1.00 500.00 500.00
--------------------------------------------------------------------------------------------------------------------------
22. REPLACE CARPET ON WALL BEHIND DESK WITH ALTERNATE 1.00 1,500.00 1,500.00
--------------------------------------------------------------------------------------------------------------------------
23. PROVIDE APPROPRIATE ARTWORK OR OTHER WALL DECOR 1.00 750.00 750.00
--------------------------------------------------------------------------------------------------------------------------
24. PROVIDE SEPARATE CHECK-IN FOR CLUB LEVEL 1.00 500.00 500.00
--------------------------------------------------------------------------------------------------------------------------
B. LOBBY CORRIDORS
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH CEILING TO UNIFORM APPEARANCE 600.00 2.00 1,200.00
--------------------------------------------------------------------------------------------------------------------------
2. PROVIDE BROCHURE AREA 1.00 500.00 500.00
--------------------------------------------------------------------------------------------------------------------------
3. REDESIGN DECOR 1.00 10,000.00 10,000.00
--------------------------------------------------------------------------------------------------------------------------
C. GIFT SHOP/BUSINESS CENTER
--------------------------------------------------------------------------------------------------------------------------
1. DEMOLISH GIFT SHOP WALLS INCLUDED IN LOBBY AREA
--------------------------------------------------------------------------------------------------------------------------
2. PROVIDE NEW GIFT SHOP/BUSINESS CENTER IN BOARDING ROOM 1.00 25,000.00 25,000.00
--------------------------------------------------------------------------------------------------------------------------
3. FAX/COPY MACHINE AND FURNISHINGS 1.00 4,500.00 4,500.00
--------------------------------------------------------------------------------------------------------------------------
Page 3
D. PUBLIC RESTROOMS - COMPLETE REDO
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE SIGNAGE WITH ADA COMPLIANT 8.00 65.00 520.00
--------------------------------------------------------------------------------------------------------------------------
2. REFINISH SCARRED ENTRY DOORS/FRAMES 2.00 250.00 500.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE SCARRED WALL COVER ON CEILING 2.00 1,500.00 3,000.00
--------------------------------------------------------------------------------------------------------------------------
4. REPLACE TILE 1.00 2,500.00 2,500.00
--------------------------------------------------------------------------------------------------------------------------
5. UPGRADE LIGHTING 2.00 1,000.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
6. REPLACE VANITIES WITH CULTURED MARBLE OR ▇▇▇ ▇▇▇▇▇ 2.00 1,500.00 3,000.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE TARNISHED FAUCETS W/ LEVER HANDLE 2.00 1,000.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
8. REFINISH OAK TRIM AROUND VANITY MIRRORS 2.00 250.00 500.00
--------------------------------------------------------------------------------------------------------------------------
9. PROVIDE SEMI RECESSED TOWEL/TRASH DISPENSER 2.00 750.00 1,500.00
--------------------------------------------------------------------------------------------------------------------------
10. REPLACE PARTITIONS 2.00 3,500.00 7,000.00
--------------------------------------------------------------------------------------------------------------------------
11. ENSURE ALL PUBLIC RESTROOMS ARE ADA COMPLIANT 2.00 5,000.00 10,000.00
--------------------------------------------------------------------------------------------------------------------------
E. PREFUNCTION AREA
--------------------------------------------------------------------------------------------------------------------------
1. PROVIDE DOOR CASING TO ENCEL METAL DOOR CASING 3.00 1,000.00 3,000.00
--------------------------------------------------------------------------------------------------------------------------
2. RAISE CEILING IF POSSIBLE 5,000.00 5.00 20,000.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE WORN CARPET 555.00 40.00 22,200.00
--------------------------------------------------------------------------------------------------------------------------
4. REFINISH SCARRED TABLES 8.00 100.00 800.00
--------------------------------------------------------------------------------------------------------------------------
5. REFINISH OR REPLACE UPHOLSTERED WOOD FRAME CHAIRS 10.00 275.00 2,750.00
--------------------------------------------------------------------------------------------------------------------------
F. BANQUET ROOMS
--------------------------------------------------------------------------------------------------------------------------
1. REPAIR/REFINISH ALL SERVICE DOORS AND FRAMES 10.00 200.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE CEILING TREATMENT/RAISE IF POSSIBLE 3.00 15,000.00 45,000.00
--------------------------------------------------------------------------------------------------------------------------
3. REFINISH OR REPLACE LOUVERED WOOD PANELS 1.00 5,000.00 5,000.00
--------------------------------------------------------------------------------------------------------------------------
4. REMOVE CARPET FROM WALLS AND REPLACE VINYL 500.00 18.00 9,000.00
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE MISMATCHED, WORN OR SCARRED AIR WALLS 1,080.00 25.00 27,000.00
--------------------------------------------------------------------------------------------------------------------------
6. STEAM CLEAN STAINED CARPETS 1.00 2,500.00 2,500.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE EXISTING W/FLOURESCENT 50.00 150.00 7,500.00
--------------------------------------------------------------------------------------------------------------------------
8. REPLACE DAMAGED BANQUET TABLES AS NECESSARY 25.00 250.00 6,250.00
--------------------------------------------------------------------------------------------------------------------------
9. REPLACE YELLOW VINYL CHAIRS 250.00 40.00 10,000.00
--------------------------------------------------------------------------------------------------------------------------
10. CLEAN EXISTING UPHOLSTERED CHAIRS 250.00 10.00 2,500.00
--------------------------------------------------------------------------------------------------------------------------
11. REFINISH PODIUM TO LIKE-NEW 1.00 250.00 250.00
--------------------------------------------------------------------------------------------------------------------------
12. REFINISH WOOD BASE THROUGHOUT 500.00 1.50 750.00
--------------------------------------------------------------------------------------------------------------------------
13. REFINISH ENTRY DOORS AND FRAMES 5.00 500.00 2,500.00
--------------------------------------------------------------------------------------------------------------------------
14. PROVIDE NEW DECOR THROUGHOUT 3.00 10,000.00 30,000.00
--------------------------------------------------------------------------------------------------------------------------
15. CLEAN AND REFINISH A/C VENTS THROUGHOUT 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
16. REPLACE SERVICE CORRIDOR FLOOR 1,000.00 2.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
17. REFINISH SERVICE CORRIDOR CEILING AND WALLS 2,200.00 1.50 3,300.00
--------------------------------------------------------------------------------------------------------------------------
18. REFINISH OR REPLACE SERVICE DOORS IN CORRIDOR 10.00 250.00 2,500.00
--------------------------------------------------------------------------------------------------------------------------
19. REPLACE DAMAGED FLOOR TILE IN HOLDING KITCHEN 60.00 5.00 300.00
--------------------------------------------------------------------------------------------------------------------------
G. RESTAURANT AND LOUNGE AREA
--------------------------------------------------------------------------------------------------------------------------
1. NEEDS RECONCEPT AND COMPLETE RENOVATION 1.00 350,000.00 350,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE ALL FINISHES INCLUDED
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE ALL FURNISHINGS INCLUDED
--------------------------------------------------------------------------------------------------------------------------
4. ELIMINATE RAISED LEVEL FOR ADA INCLUDED
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE TABLE TOP DECOR INCLUDED
--------------------------------------------------------------------------------------------------------------------------
Page 4
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6. REPLACE CHINA INCLUDED
--------------------------------------------------------------------------------------------------------------------------
7. PROVIDE PORTABLE PHONE INCLUDED
--------------------------------------------------------------------------------------------------------------------------
8. REDESIGN ENTRY INCLUDED
--------------------------------------------------------------------------------------------------------------------------
9. REPLACE HOSTESS CASHIER STATIONS INCLUDED
--------------------------------------------------------------------------------------------------------------------------
10. PROVIDE PAGING/MUSIC SYSTEM INCLUDED
--------------------------------------------------------------------------------------------------------------------------
H. SWIMMING POOL AND DECK
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH POOL INTERIOR 1.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
2. REFINISH AND RESTORE THE POOL COPING 1.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
3. REMOVE CARPET AND REFINISH DECK 2,000.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
4. REPLACE CHAISES 10.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE TABLES AND CHAIRS 4.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
6. REPLACE UMBRELLAS 4.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
7. PROVIDE UNIVERSAL NO DIVING SIGNS 1.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
8. REFINISH POOL ENTRY DOORS AND FRAME 1.00 WAIVER 0.00
--------------------------------------------------------------------------------------------------------------------------
9. ADDITIONAL TO REMOVE POOL/CREATE ENTRY/F&B OUTLET 1.00 DEFER 0.00
--------------------------------------------------------------------------------------------------------------------------
I. EXERCISE FACILITY - MIN 325SF - 10' CEILING
--------------------------------------------------------------------------------------------------------------------------
1. PROVIDE 3 PIECES OF EQUIPMENT PER STANDARDS 3.00 3,500.00 10,500.00
--------------------------------------------------------------------------------------------------------------------------
2. PROVIDE 20" OR LARGER TV 1.00 300.00 300.00
--------------------------------------------------------------------------------------------------------------------------
3. PROVIDE WALL MOUNTED CLOCK W/SECOND HAND 1.00 75.00 75.00
--------------------------------------------------------------------------------------------------------------------------
4. PROVIDE COLORFUL GRAPHICS AND MFR INSTRUCTION 4.00 65.00 260.00
--------------------------------------------------------------------------------------------------------------------------
5. RELOCATE TO ACCOUNTING OFFICE AREA 1.00 30,000.00 30,000.00
--------------------------------------------------------------------------------------------------------------------------
6. PROVIDE SEPARATE CHANGING FACILITIES 2.00 5,000.00 10,000.00
--------------------------------------------------------------------------------------------------------------------------
7. PROVIDE SAUNA OR WHIRLPOOL FOR 10 1.00 10,000.00 10,000.00
--------------------------------------------------------------------------------------------------------------------------
J. ELEVATORS
--------------------------------------------------------------------------------------------------------------------------
1. REQUIRE COMPLETE RENOVATION FOR ADA COMPLIANCE 3.00 15,000.00 45,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REFINISH DOORS ON ALL FLOORS 27.00 500.00 13,500.00
--------------------------------------------------------------------------------------------------------------------------
K. STAIRWELLS/HALLWAYS
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH WALLS THROUGHOUT 2.00 10,000.00 20,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REFINISH RAILINGS 2.00 7,500.00 15,000.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE AND UPGRADE LIGHT FIXTURES 20.00 150.00 3,000.00
--------------------------------------------------------------------------------------------------------------------------
IV. PRIVATE GUEST AREAS
A. GUEST ROOM CORRIDOR
--------------------------------------------------------------------------------------------------------------------------
1. PROVIDE NEW SIGN PACKAGE 240.00 65.00 15,600.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE WALL COVERING 2,XX0.00 18.00 50,400.00
--------------------------------------------------------------------------------------------------------------------------
3. REFINISH GUESTROOM DOORS 240.00 150.00 36,000.00
--------------------------------------------------------------------------------------------------------------------------
4. REPLACE CARPET 1,600.00 32.00 51,200.00
--------------------------------------------------------------------------------------------------------------------------
5. REFINISH EXIT DOORS AND FRAMES 16.00 125.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
6. REFINISH STORAGE ROOM DOORS 16.00 125.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
7. UPGRADED FINISHES FOR CLUB LEVEL FLOOR 1.00 25,000.00 25,000.00
--------------------------------------------------------------------------------------------------------------------------
B. GUEST VENDING AREAS
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH WALLS AND WOOD BASE 8.00 425.00 3,400.00
--------------------------------------------------------------------------------------------------------------------------
Page 5
------------------------------------------------------------------------------------------------------------------------------
2. REPLACE VINYL FLOORING WITH TILE 8.00 500.00 4,000.00
------------------------------------------------------------------------------------------------------------------------------
3. REPLACE DAMAGED TRASH CANS M/R 0.00
-------------------------------------------------------------------------------------------------------------------------------
C. GUESTROOMS
-------------------------------------------------------------------------------------------------------------------------------
1. REFINISH OR REPLACE ALL ENTRY DOORS/FRAMES IN CORRIDOR 0.00
-------------------------------------------------------------------------------------------------------------------------------
2. ENSURE ALL SELF CLOSERS ARE OPERATIONAL M/R 0.00
-------------------------------------------------------------------------------------------------------------------------------
3. PROVIDE RIGID CLOSET DOORS IN ALL ROOMS 240.00 450.00 108,000.00
-------------------------------------------------------------------------------------------------------------------------------
4. PROVIDE 1" THUMB TURN DEADBOLTS ON CONNECTING DOORS 150.00 75.00 11,250.00
-------------------------------------------------------------------------------------------------------------------------------
5. REPLACE WALL VINYL 210.00 660.00 138,600.00
-------------------------------------------------------------------------------------------------------------------------------
6. REPLACE CARPET THROUGHOUT/USE CARPET BASE 8,085.00 15.00 121,275.00
-------------------------------------------------------------------------------------------------------------------------------
7. PROVIDE CARPET BASE 210.00 100.00 21,000.00
-------------------------------------------------------------------------------------------------------------------------------
8. REPLACE DRAPERIES AND ADD VALANCE 210.00 500.00 105,000.00
-------------------------------------------------------------------------------------------------------------------------------
9. REPLACE KING BEDSPREADS 150.00 85.00 12,750.00
-------------------------------------------------------------------------------------------------------------------------------
10. REPLACE FULL XL BEDSPREADS 200.00 75.00 15,000.00
-------------------------------------------------------------------------------------------------------------------------------
11. REPLACE PILLOWS AS NEEDED 400.00 4.00 1,600.00
-------------------------------------------------------------------------------------------------------------------------------
13. REPLACE ALL CASEGOODS 210.00 1,600.00 336,000.00
-------------------------------------------------------------------------------------------------------------------------------
14. REPLACE FULL LENGTH MIRROR CLOSET DOOR WILL BE MIRROR
-------------------------------------------------------------------------------------------------------------------------------
15. REPLACE ALL LIGHT PACKAGES 210.00 225.00 47,250.00
-------------------------------------------------------------------------------------------------------------------------------
16. REPLACE ALL ARTWORK 420.00 50.00 25,200.00
-------------------------------------------------------------------------------------------------------------------------------
17. REPLACE ANY STAINED OR SAGGING MATTRESS SETS 120.00 250.00 30,000.00
-------------------------------------------------------------------------------------------------------------------------------
18. REPLACE ACTIVITY CHAIRS 180.00 150.00 27,000.00
-------------------------------------------------------------------------------------------------------------------------------
19. PROVIDE LOUNGE CHAIRS AND OTTOMANS FOR KINGS 72.00 375.00 27,000.00
-------------------------------------------------------------------------------------------------------------------------------
20. PROVIDE SOFAS FOR KINGS 72.00 550.00 39,600.00
-------------------------------------------------------------------------------------------------------------------------------
21. REFINISH SCARRED A/C'S 200.00 75.00 15,000.00
-------------------------------------------------------------------------------------------------------------------------------
22. REPLACE INOPERATIVE A/C UNITS W/HEAT PUMP 20.00 625.00 12,500.00
-------------------------------------------------------------------------------------------------------------------------------
23. PROVIDE 25" OR LARGER TV W/REMOTE 240.00 375.00 90,000.00
-------------------------------------------------------------------------------------------------------------------------------
24. PROVIDE 14" CORDS ON ALL GUEST ROOMS PHONES 400.00 12.00 4,800.00
-------------------------------------------------------------------------------------------------------------------------------
25. PROVIDE THREE ADA COMPLIANT ROOMS 3.00 10,000.00 30,000.00
-------------------------------------------------------------------------------------------------------------------------------
26. CONVERT 9 BAYS TO ROOMS 9.00 10,000.00 90,000.00
-------------------------------------------------------------------------------------------------------------------------------
27. PROVIDE CONTOURED WOOD HANGERS FOR ALL ROOMS 165.00 50.00 8,250.00
-------------------------------------------------------------------------------------------------------------------------------
28. ENCLOSE SPRINKLER SYSTEM 240.00 400.00 96,000.00
-------------------------------------------------------------------------------------------------------------------------------
29. BUILD OUT WALL TO ADD ELECTRICAL 120.00 WAIVER 0.00
-------------------------------------------------------------------------------------------------------------------------------
▇. ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇
-------------------------------------------------------------------------------------------------------------------------------
1. UPGRADED CASEGOODS PACKAGE FOR EXECUTIVE LEVEL 30.00 1,600.00 48,000.00
-------------------------------------------------------------------------------------------------------------------------------
2. DRAPERY AND HARD CORNICE FOR EXEC LEVEL 30.00 500.00 15,000.00
-------------------------------------------------------------------------------------------------------------------------------
3. UPGRADED LIGHT PACKAGE FOR CLUB LEVEL 30.00 400.00 12,000.00
-------------------------------------------------------------------------------------------------------------------------------
4. REPLACE MATTRESS/SPRINGS 30.00 300.00 9,000.00
-------------------------------------------------------------------------------------------------------------------------------
5. REPLACE BEDSPREADS W/UPGRADED COMFORTER/DUST RUFFLE 30.00 250.00 7,500.00
-------------------------------------------------------------------------------------------------------------------------------
6. REPLACE WALL VINYL 30.00 660.00 19,800.00
-------------------------------------------------------------------------------------------------------------------------------
7. REPLACE CARPET AND ADD BASE 1,100.00 15.00 16,500.00
-------------------------------------------------------------------------------------------------------------------------------
8. ADD MINI BARS 30.00 400.00 12,000.00
-------------------------------------------------------------------------------------------------------------------------------
9. REPLACE ARTWORK 90.00 75.00 6,750.00
-------------------------------------------------------------------------------------------------------------------------------
10. ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ 1.00 10,000.00 10,000.00
-------------------------------------------------------------------------------------------------------------------------------
11. PROVIDE EXECUTIVE BOARDROOM CONVERSION 1.00 10,000.00 10,000.00
-------------------------------------------------------------------------------------------------------------------------------
Page 6
E. REGULAR GUEST BATHROOMS
---------------------------------------------------------------------------------------------------------------------------
1. REFINISH DOORS AND FRAMES AS NECESSARY 240.00 50.00 12,000.00
---------------------------------------------------------------------------------------------------------------------------
2. RECONDITION TILE AND GROUT TO LIKE NW 210.00 110.00 23,100.00
---------------------------------------------------------------------------------------------------------------------------
3. REPLACE WALL VINYL 210.00 144.00 30,240.00
---------------------------------------------------------------------------------------------------------------------------
4. REPAINT CEILINGS 240.00 35.00 8,400.00
---------------------------------------------------------------------------------------------------------------------------
5. REPLACE VANITY HARDWARE 240.00 75.00 18,000.00
---------------------------------------------------------------------------------------------------------------------------
6. REWORK LIGHT BOX SOFFIT TO ELIMINATE WOOD TRIM AND BRIGHTEN 240.00 300.00 72,000.00
---------------------------------------------------------------------------------------------------------------------------
7. PROVIDE SHOWER CURTAIN W/SEPARATE LINER 210.00 15.00 3,150.00
---------------------------------------------------------------------------------------------------------------------------
8. REPLACE ANY WORN TUB HARDWARE 150.00 100.00 15,000.00
---------------------------------------------------------------------------------------------------------------------------
9. REMOVE AND REPLACE TUB SURROUND 240.00 800.00 192,000.00
---------------------------------------------------------------------------------------------------------------------------
10. REPLACE WASTE CONTAINERS 480.00 15.00 7,200.00
---------------------------------------------------------------------------------------------------------------------------
11. PROVIDE HAIR DRYERS 240.00 25.00 6,000.00
---------------------------------------------------------------------------------------------------------------------------
12. LIGHTED MAKE-UP MIRRORS 240.00 50.00 12,000.00
---------------------------------------------------------------------------------------------------------------------------
13. COFFEE MAKERS 240.00 30.00 7,200.00
---------------------------------------------------------------------------------------------------------------------------
14. BATHROBES 400.00 20.00 8,000.00
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
F. CLUB LEVEL BATH UPGRADES
---------------------------------------------------------------------------------------------------------------------------
1. NEW VANITIES 30.00 325.00 9,750.00
---------------------------------------------------------------------------------------------------------------------------
2. PROVIDE UPGRADED SHOWER CURTAIN AND LINER 30.00 30.00 900.00
---------------------------------------------------------------------------------------------------------------------------
3. REPLACE WALLCOVERING 350.00 18.00 6,300.00
---------------------------------------------------------------------------------------------------------------------------
4. REPLACE TILE FLOORS W/UPGRADED MATERIAL 30.00 350.00 10,500.00
---------------------------------------------------------------------------------------------------------------------------
V. BACK OF THE HOUSE
A. KITCHEN
---------------------------------------------------------------------------------------------------------------------------
1. REFINISH ENTRY DOORS 4.00 150.00 600.00
---------------------------------------------------------------------------------------------------------------------------
2. REPLACE DAMAGED KICK/PUSH PLATES 4.00 100.00 400.00
---------------------------------------------------------------------------------------------------------------------------
3. REFINISH CEILING IN F&B DIRECTOR OFFICE 120.00 2.00 240.00
---------------------------------------------------------------------------------------------------------------------------
4. REPLACE DAMAGED FLOOR TILE IN DRY STORAGE 25.00 10.00 250.00
---------------------------------------------------------------------------------------------------------------------------
5. REPLACE BROKEN CEILING LIGHT LENSES 5.00 50.00 250.00
---------------------------------------------------------------------------------------------------------------------------
6. REPLACE DAMAGED DOOR GASKETS IN WALK IN 4.00 50.00 200.00
---------------------------------------------------------------------------------------------------------------------------
7. REPLACE RUSTED STORAGE RACKS IN WALK IN 1.00 1,000.00 1,000.00
---------------------------------------------------------------------------------------------------------------------------
8. REFINISH RUSTED CEILING IN WALK IN 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------------------------
9. REFINISH WALLS IN PRODUCE WALK-IN 1.00 1,500.00 1,500.00
---------------------------------------------------------------------------------------------------------------------------
10. REPLACE BURNED LIGHT LENS IN PRODUCE WALK-IN 1.00 50.00 50.00
---------------------------------------------------------------------------------------------------------------------------
11. CLEAN AND REFINISH HVAC VENTS THROUGHOUT KITCHEN 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------------------------
B. EMPLOYEE BREAKROOM
---------------------------------------------------------------------------------------------------------------------------
1. REFINISH THROUGHOUT 1.00 1,000.00 1,000.00
---------------------------------------------------------------------------------------------------------------------------
2. REFINISH EMPLOYEES RESTROOMS 2.00 500.00 1,000.00
---------------------------------------------------------------------------------------------------------------------------
C. MISCELLANEOUS
---------------------------------------------------------------------------------------------------------------------------
1. DATAPORT PHONE IN ADDTN TO REG PHONE 240.00 75.00 18,000.00
---------------------------------------------------------------------------------------------------------------------------
2. FULL SIZE ELECTRIC IRON/BOARD/CADDY 240.00 65.00 15,600.00
---------------------------------------------------------------------------------------------------------------------------
3. CONVERSION ITEMS 1.00 25,000.00 25,000.00
---------------------------------------------------------------------------------------------------------------------------
4. SALES AUTOMATION 1.00 DEFER 0.00
---------------------------------------------------------------------------------------------------------------------------
PAGE 7
-----------------------------------------------------------------------
5. UNIFORMS 100.00 250.00 25,000.00
-----------------------------------------------------------------------
6. BANQUET EQUIPMENT 1.00 35,000.00 35,000.00
-----------------------------------------------------------------------
7. GRAND OPENING 1.00 0.00 0.00
-----------------------------------------------------------------------
8. LINEN REPLACEMENT 1.00 55,000.00 55,000.00
-----------------------------------------------------------------------
9. REPAIR SEISMIC CRACKING 1.00 30,000.00 30,000.00
-----------------------------------------------------------------------
10. AUDIO VISUAL EQUIPMENT 1.00 20,000.00 20,000.00
-----------------------------------------------------------------------
VI. GENERAL CONDITIONS
-----------------------------------------------------------------------
A. GENERAL CONDITIONS 4,204,135.00 0.09 378,372.15
-----------------------------------------------------------------------
B. DEPARTMENT INCENTIVE 4,204,135.00 0.01 42,041.35
-----------------------------------------------------------------------
C. DEPARTMENT OVERHEAD 4,204,135.00 0.01 42,041.35
-----------------------------------------------------------------------
--------------------------------------------------------------------------------
TOTAL 4,666,589.85
--------------------------------------------------------------------------------
Page ▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇
SUMMARY
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
--------------------------------------------------------
AREAS EST.COST
--------------------------------------------------------
I. EXTERIOR 232,500.00
II. BUILDING STRUCTURES 372,500.00
III. PUBLIC AREAS 557,598.00
IV. PRIVATE GUEST AREAS 3,149,340.00
V. BACK OF THE HOUSE 0.00
VI. MISCELLANEOUS 208,199.00
VII. GENERAL CONDITIONS 497,215.07
--------------------------------------------------------
TOTAL 5,017,352.07
--------------------------------------------------------
Page ▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
------------------------------------------------------------------------------------------------
RE'D QUANTITY/ UNIT EST.
AREAS SCOPE OF WORK YES ALLOWANCE COST COST
------------------------------------------------------------------------------------------------
1. EXTERIOR
A. LANDSCAPING
---------------------------------------------------------------------------------------
1. UPGRADE PLANTS AND LIGHTING 1.00 25,000.00 25,000.00
---------------------------------------------------------------------------------------
B. PARKING LOT AND DRIVES
---------------------------------------------------------------------------------------
1. REPAIR AND STRIPE 1.00 25,000.00 25,000.00
---------------------------------------------------------------------------------------
C. SIGNAGE
---------------------------------------------------------------------------------------
1. BRAND REQUIRED SIGNAGE 1.00 75,000.00 75,000.00
---------------------------------------------------------------------------------------
D. DUMPSTER SCREENING
---------------------------------------------------------------------------------------
1. FENCING TO CONCEAL DUMPSTER 1.00 5,000.00 5,000.00
---------------------------------------------------------------------------------------
E. EXTERIOR SWIMMING POOL AREA
---------------------------------------------------------------------------------------
1. UPGRADE FURNISHINGS/LANDSCAPE/DECK 1.00 25,000.00 25,000.00
---------------------------------------------------------------------------------------
F. PARKING LOT LIGHTING
---------------------------------------------------------------------------------------
1. UPGRADE LIGHTING 2.00 10,000.00 20,000.00
---------------------------------------------------------------------------------------
G. COMMERCIAL BUILDING
---------------------------------------------------------------------------------------
1. COORDINATE W/EXTERIOR OF TOWER 1.00 50,000.00 50,000.00
---------------------------------------------------------------------------------------
H. COOLING TOWERS
---------------------------------------------------------------------------------------
1. CONCEAL EQUIPMENT 1.00 7,500.00 7,500.00
---------------------------------------------------------------------------------------
I. CABANA
---------------------------------------------------------------------------------------
1. ADD CAP TO CONCEAL POOL GLAZING 1.00 3,000.00 0.00
---------------------------------------------------------------------------------------
II. BUILDING STRUCTURES
A. COVERED DRIVE (CANOPIES)
---------------------------------------------------------------------------------------
1. PAINT CANOPY COORD. W/BUILDING 1.00 5,500.00 5,500.00
---------------------------------------------------------------------------------------
2. UPGRADE CANOPY CEILING LIGHTING 1.00 10,000.00 10,000.00
---------------------------------------------------------------------------------------
3. INSTALL PAVERS UNDER CANOPY 700.00 10.00 7,000.00
---------------------------------------------------------------------------------------
4. RECONFIGURE MAIN ENTRY 1.00 25,000.00 25,000.00
---------------------------------------------------------------------------------------
PAGE 2
B. GUEST ROOM TOWER
-----------------------------------------------------------------------
1. PAINT ENTIRE STRUCTURE 140,000.00 0.75 105,000.00
-----------------------------------------------------------------------
2. REPAIR RAILINGS 1.00 25,000.00 25,000.00
-----------------------------------------------------------------------
3. PARAPET ROOF DETAIL 650.00 300.00 195,000.00
-----------------------------------------------------------------------
III. PUBLIC AREAS
A. LOBBY
-----------------------------------------------------------------------
1. REPLACE TILE FLOOR 2,500.00 15.00 37,500.00
-----------------------------------------------------------------------
2. REPLACE VINYL WALLCOVERING 200.00 18.00 3,600.00
-----------------------------------------------------------------------
3. REPLACE CARPET 100.00 30.00 3,000.00
-----------------------------------------------------------------------
4. ADD ART ACCESSORIES 1.00 10,000.00 10,000.00
-----------------------------------------------------------------------
5. REPLACE FURNISHINGS 1.00 25,000.00 25,000.00
-----------------------------------------------------------------------
6. REPLACE LOBBY SIGNAGE 1.00 2,000.00 2,000.00
-----------------------------------------------------------------------
7. REPLACE DOOR TO EXER. AREA 1.00 450.00 450.00
-----------------------------------------------------------------------
8. LOBBY RESTROOMS 2.00 12,000.00 24,000.00
-----------------------------------------------------------------------
9. PROVIDE NEW PHONE PARTITIONS 1.00 7,500.00 7,500.00
-----------------------------------------------------------------------
10. REPLACE LAY IN CEILING
W/SHEETROCK 2,500.00 6.00 15,000.00
-----------------------------------------------------------------------
11. ADD WOOD BASE 200.00 5.00 1,000.00
-----------------------------------------------------------------------
B. FRONT DESK
-----------------------------------------------------------------------
1. REPLACE FRONT DESK 1.00 15,000.00 15,000.00
-----------------------------------------------------------------------
2. REMOVE INDENTS/REFINISH
BEHIND F/D 300.00 8.00 2,400.00
-----------------------------------------------------------------------
C. PUBLIC RESTROOMS PREFUNCTION AREA
-----------------------------------------------------------------------
1. RECONFIG TO ENLARGE AND
MEET ADA 2.00 20,000.00 40,000.00
-----------------------------------------------------------------------
D. PREFUNCTION AREA
-----------------------------------------------------------------------
1. REFINISH STUCCO WALL 750.00 0.50 375.00
-----------------------------------------------------------------------
2. REFINISH TILE FLOOR 1,054.00 2.00 2,108.00
-----------------------------------------------------------------------
3. REPLACE RUGS/FURNISHINGS 1.00 10,000.00 10,000.00
-----------------------------------------------------------------------
4. REPLACE DOORS 4.00 650.00 2,600.00
-----------------------------------------------------------------------
5. REPLACE DOORS TO OUTSIDE 4.00 650.00 2,600.00
-----------------------------------------------------------------------
6. REPLACE SIGNAGE 1.00 1,000.00 1,000.00
-----------------------------------------------------------------------
7. REPLACE CEILING LIGHTING 1.00 5,000.00 5,000.00
-----------------------------------------------------------------------
8. REPLACE LAY IN CEILING
W/SHEETROCK 1,056.00 2.50 2,640.00
-----------------------------------------------------------------------
E. EXISTING BALLROOM
-----------------------------------------------------------------------
1. REPLACE CARPET 500.00 35.00 DEFER
-----------------------------------------------------------------------
2. REPLACE VINYL WALLCOVERING 300.00 18.00 DEFER
-----------------------------------------------------------------------
3. BUILD PERMANENT DIVISIONS
FOR BREAKOUTS 2,800.00 10.00 DEFER
-----------------------------------------------------------------------
Page 3
-----------------------------------------------------------------------------------------------------------------
4. PROVIDE WALLCOVER FOR NEW PARTITIONS 250.00 18.00 DEFER
-----------------------------------------------------------------------------------------------------------------
5. REMOVE AIRWALLS 1.00 5,000.00 DEFER
-----------------------------------------------------------------------------------------------------------------
6. REPLACE DROP IN CEILING W/SHEETROCK 1,200.00 3.50 DEFER
-----------------------------------------------------------------------------------------------------------------
7. REPLACE CHANDALIERS W/NEW LIGHTING 4.00 2,500.00 DEFER
-----------------------------------------------------------------------------------------------------------------
8. REPLACE CHAIRS 500.00 40.00 DEFER
-----------------------------------------------------------------------------------------------------------------
9. REPLACE ANY BROKEN TABLES 20.00 300.00 DEFER
-----------------------------------------------------------------------------------------------------------------
F. BROAD/DIRECTORS ROOM
-----------------------------------------------------------------------------------------------------------------
1. CREATE NEW FROM BEDROOM ON 15TH FLOOR VIP 1.00 3,500.00 3,500.00
-----------------------------------------------------------------------------------------------------------------
2. FURNISHINGS 0.00 0.00 0.00
-----------------------------------------------------------------------------------------------------------------
G. RESTAURANT/LOUNGE
-----------------------------------------------------------------------------------------------------------------
1. RECONFIGURE BAR TO CREATE LOBBY BAR 1.00 75,000.00 75,000.00
-----------------------------------------------------------------------------------------------------------------
2. REMOVE BUFFET 1.00 3,500.00 3,500.00
-----------------------------------------------------------------------------------------------------------------
3. ACCESSORIZE EXIST THEME/MORE ESTAB. LOOK 1.00 20,000.00 20,000.00
-----------------------------------------------------------------------------------------------------------------
4. RECONCEPT LILS TO PVT DINING IN SW REST. 1.00 20,000.00 20,000.00
-----------------------------------------------------------------------------------------------------------------
5. CLEAN CARPET 1.00 1,000.00 1,000.00
-----------------------------------------------------------------------------------------------------------------
6. REPLACE FIRE EXIT DOOR AT REAR 1.00 450.00 450.00
-----------------------------------------------------------------------------------------------------------------
7. CREATE DISPLAY KITCHEN 1.00 200,000.00 DELETE
-----------------------------------------------------------------------------------------------------------------
H. EXERCISE FACILITY
-----------------------------------------------------------------------------------------------------------------
1. GUT & RECONFIG W/NEW EQUIP 1.00 30,000.00 30,000.00
-----------------------------------------------------------------------------------------------------------------
2. REFINISH HALLWAY/CONCEAL WIRE MOLD 1.00 3,500.00 3,500.00
-----------------------------------------------------------------------------------------------------------------
3. ADD WINDOW TREATMENT 8.00 250.00 2,000.00
-----------------------------------------------------------------------------------------------------------------
4. REPLACE CARPET IN HALLWAY 25.00 35.00 875.00
-----------------------------------------------------------------------------------------------------------------
I. GIFT SHOP/BUSINESS CENTER
-----------------------------------------------------------------------------------------------------------------
1. REDUCE SIZE OF GIFT SH/ADD ▇▇▇.▇▇▇▇▇▇ 1.00 15,000.00 15,000.00
-----------------------------------------------------------------------------------------------------------------
J. ELEVATORS
-----------------------------------------------------------------------------------------------------------------
1. UPGRADE INTERIOR FINISH 2.00 5,000.00 10,000.00
-----------------------------------------------------------------------------------------------------------------
2. EQUIP EMPTY SHAFT FOR THIRD ELEV. 1.00 150,000.00 150,000.00
-----------------------------------------------------------------------------------------------------------------
K. CONCIERGE LOUNGE
-----------------------------------------------------------------------------------------------------------------
1. CONVERT 15TH FLOOR VIP 1.00 10,000.00 10,000.00
-----------------------------------------------------------------------------------------------------------------
L. NEW BALLROOM
-----------------------------------------------------------------------------------------------------------------
1. CONSTRUCT 5000 SF BALLROOM 5,000.00 200.00 DEFER
-----------------------------------------------------------------------------------------------------------------
IV. PRIVATE GUEST AREAS
A. GUEST ROOM CORRIDOR/ELEVATOR LOBBIES
-----------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET 2,200.00 30.00 66,000.00
-----------------------------------------------------------------------------------------------------------------
2. REPLACE CARPET PAD 2,200.00 3.00 6,600.00
-----------------------------------------------------------------------------------------------------------------
Page 4
------------------------------------------------------------------------------------------------------
3. ADD WOOD BASE 5,200.00 5.00 26,000.00
------------------------------------------------------------------------------------------------------
4. REPLACE VINYL WALLCOVERING 4,500.00 18.00 81,000.00
------------------------------------------------------------------------------------------------------
5. ▇▇▇▇▇▇ CEILING 4,000.00 13.00 52,000.00
------------------------------------------------------------------------------------------------------
6. REMOVE CEILING FLOURESC/ADD SCONCES 13.00 3,000.00 39,000.00
------------------------------------------------------------------------------------------------------
7. ELEVATOR LOBBY FURNISHINGS 13.00 750.00 9,750.00
------------------------------------------------------------------------------------------------------
8. IMPROVE HOUSE PHONE PRESENTATION 13.00 350.00 4,550.00
------------------------------------------------------------------------------------------------------
9. DIRECTIONAL SIGNAGE 1.00 10,000.00 10,000.00
------------------------------------------------------------------------------------------------------
B. GUEST VENDING AREAS
------------------------------------------------------------------------------------------------------
1. REPLACE BIN ICE MACHINES 6.00 3,800.00 22,800.00
------------------------------------------------------------------------------------------------------
2. REPLACE WALL FINISHES 630.00 13.00 8,190.00
------------------------------------------------------------------------------------------------------
3. REPLACE TILE FLOORS 1,430.00 5.00 7,150.00
------------------------------------------------------------------------------------------------------
4. REPLACE DOORS 13.00 450.00 5,850.00
------------------------------------------------------------------------------------------------------
C. GUEST ROOMS
------------------------------------------------------------------------------------------------------
1. REPLACE CASEGOODS 280.00 1,500.00 420,000.00
------------------------------------------------------------------------------------------------------
2. COVERLET AND DUST RUFFLE 450.00 125.00 56,250.00
------------------------------------------------------------------------------------------------------
3. DRAPERY AND SHEER 280.00 500.00 140,000.00
------------------------------------------------------------------------------------------------------
4. REPLACE CARPET/PAD/BASE 280.00 700.00 190,000.00
------------------------------------------------------------------------------------------------------
5. REPLACE VWC 14,000.00 12.00 168,000.00
------------------------------------------------------------------------------------------------------
6. REPLACE LIGHT PACKAGE 280.00 250.00 70,000.00
------------------------------------------------------------------------------------------------------
7. REPLACE MATTRESS AND SPRINGS 450.00 250.00 112,500.00
------------------------------------------------------------------------------------------------------
8. REPLACE DESK CHAIRS 552.00 150.00 82,800.00
------------------------------------------------------------------------------------------------------
9. REPLACE LOUNGE CHAIRS 276.00 375.00 103,500.00
------------------------------------------------------------------------------------------------------
10. REPLACE SOFA/SLEEPERS IN STUDIOS W/SICO 4.00 3,000.00 12,000.00
------------------------------------------------------------------------------------------------------
12. RECLAIM/MAKE 14 ROOMS ON SECOND/THIRD FLOOR 8.00 7,500.00 60,000.00
------------------------------------------------------------------------------------------------------
13. REPLACE ALL ENTRY DOORS 280.00 375.00 105,000.00
------------------------------------------------------------------------------------------------------
14. REPLACE ALL CONNECTING DOORS 160.00 300.00 48,000.00
------------------------------------------------------------------------------------------------------
15. ELECTRONIC LOCKS 280.00 325.00 91,000.00
------------------------------------------------------------------------------------------------------
16. SECOND TELEPHONE W/DATAPORT 280.00 75.00 21,000.00
------------------------------------------------------------------------------------------------------
17. ALL NEW DOOR NUMBERS 280.00 30.00 8,400.00
------------------------------------------------------------------------------------------------------
D. GUEST BATHROOMS
------------------------------------------------------------------------------------------------------
1. COMPLETE GUT AND REDO 279.00 4,000.00 1,116,000.00
------------------------------------------------------------------------------------------------------
INCLUDES CLOSET AND COFFEE MAKER SHELF
------------------------------------------------------------------------------------------------------
V. BACK OF THE HOUSE
A.
------------------------------------------------------------------------------------------------------
1. 0.00
------------------------------------------------------------------------------------------------------
2. 0.00
------------------------------------------------------------------------------------------------------
VI. MISCELLANEOUS
Page 5
A. CONVERSION ITEMS
------------------------------------------------------------------------------------------------------
1. CONVERSION ITEMS-LOGO 1.00 30,000.00 30,000.00
------------------------------------------------------------------------------------------------------
2. UNIFORMS 1.00 15,000.00 15,000.00
------------------------------------------------------------------------------------------------------
3. F&B TABLETOP/EQUIPMENT 1.00 25,000.00 25,000.00
------------------------------------------------------------------------------------------------------
4. FURNISHINGS FOR NEW BALLROOM 1.00 42,000.00 DEFER
------------------------------------------------------------------------------------------------------
5. AUDIO VISUAL 1.00 20,000.00 20,000.00
------------------------------------------------------------------------------------------------------
6. LINEN REPLACEMENT 1.00 20,000.00 17,199.00
------------------------------------------------------------------------------------------------------
7. REPAIR COOLING TOWERS 2.00 20,000.00 0.00
------------------------------------------------------------------------------------------------------
8. PMS SYSTEM 1.00 45,000.00 45,000.00
------------------------------------------------------------------------------------------------------
B. TRANSPORTATION
------------------------------------------------------------------------------------------------------
1. REPLACE VANS 2.00 28,000.00 56,000.00
------------------------------------------------------------------------------------------------------
VII. GENERAL CONDITIONS
------------------------------------------------------------------------------------------------------
A. GENERAL CONDITIONS 4,520,137.00 0.09 406,812.33
------------------------------------------------------------------------------------------------------
B. DEPARTMENT INCENTIVES 4,520,137.00 0.01 45,201.37
------------------------------------------------------------------------------------------------------
C. DEPARTMENT OVERHEAD 4,520,137.00 0.01 45,201.37
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
TOTAL: 5,017,352.07
---------------------------------------------------------------------------------------------------------------
HILTON TOLEDO
TOLEDO, OH
SUMMARY
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
--------------------------------------------------------------------------------
AREAS EST. COST
--------------------------------------------------------------------------------
I. EXTERIOR 0.00
II. BUILDING STRUCTURES 0.00
III. PUBLIC AREAS 68,486.67
IV. PRIVATE GUEST AREAS 240,410.00
V. BACK OF THE HOUSE
VI. MISCELLANEOUS 0.00
VII. GENERAL CONDITIONS 32,434.15
--------------------------------------------------------------------------------
TOTAL 341,330.82
--------------------------------------------------------------------------------
Page 1
HILTON TOLEDO
TOLEDO, OH
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
------------------------------------------------------------------------------------------------------------------------
RE'D QUANITY UNIT EST.
AREAS SCOPE OF WORK YES ALLOWANCE COST COST
------------------------------------------------------------------------------------------------------------------------
1. EXTERIOR
A. SIGNAGE REQUIRED
---------------------------------------------------------------------------------------------------------------
1. REPLACE ENTRY SIGN W/SCRIPT LOGO 1.00 5,000.00 DEFERRED 1997
---------------------------------------------------------------------------------------------------------------
2. INSTALL SCRIPT LOGO ON PORTE COCHERE 1.00 5,000.00 DEFERRED 1997
---------------------------------------------------------------------------------------------------------------
0.00
0.00
II. BUILDING STRUCTURES 0.00
0.00
III. PUBLIC AREAS 0.00
0.00
A. LOBBY 0.00
---------------------------------------------------------------------------------------------------------------
1. REPLACE PEDIMAT IN ENTRY VESTIBULE AREA 1.00 2,200.00 2,200.00
---------------------------------------------------------------------------------------------------------------
2. REPLACE CONCIEGE DESK 1.00 450.00 450.00
---------------------------------------------------------------------------------------------------------------
3. REPLACE MARBLE TILE IN LOBBY & 1.00 5,000.00 5,000.00
---------------------------------------------------------------------------------------------------------------
ADJACENT AREA AS NEEDED 0.00
---------------------------------------------------------------------------------------------------------------
4. REPLACE AREA CARPET 64.00 30.00 1,920.00
---------------------------------------------------------------------------------------------------------------
5. REPLACE UPHOLST SEATING COORD. W/CARPET 1.00 4,000.00 4,000.00
---------------------------------------------------------------------------------------------------------------
6. REPLACE MANUAL ENTRY W/AUTO ENTRY DOOR 1.00 18,000.00 NOT CONSIDERED
---------------------------------------------------------------------------------------------------------------
0.00
B. RESTAURANT DINING AREA - SQ.FT. 0.00
---------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET & PAD 388.89 30.00 11,666.67
---------------------------------------------------------------------------------------------------------------
2. INSTALL CARPET & PAD INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
3. REFINISH BASE MOULDINGS 1.00 2,500.00 2,500.00
---------------------------------------------------------------------------------------------------------------
4. REPLACE HOSTESS/CASHIER STAND 1.00 3,000.00 3,000.00
---------------------------------------------------------------------------------------------------------------
5. PROVIDE A PERM. BUFFET LINE WITH 1.00 6,000.00 6,000.00
---------------------------------------------------------------------------------------------------------------
CABINTRY SOLID SURFACE & STONE TOP 0.00
---------------------------------------------------------------------------------------------------------------
0.00
C. LOUNGE 0.00
---------------------------------------------------------------------------------------------------------------
1. REPLACE VINYL WALLCOVERING 300.00 18.00 DEFERRED 1997
---------------------------------------------------------------------------------------------------------------
2. INSTALL VINYL WALLCOVERING INCLUDED DEFERRED 1997
---------------------------------------------------------------------------------------------------------------
3. REPLACE VINYL BASE W/WOOD R CARPET BASE 1.00 2,500.00 DEFERRED 1997
---------------------------------------------------------------------------------------------------------------
4. REFINISH WOOD SURFACE ABOVE FIREPLACE 1.00 500.00 DEFERRED 1997
---------------------------------------------------------------------------------------------------------------
5. INSTALL MANTLE R HOOD TO FIREPLACE 1.00 1,500.00 DEFERRED 1997
---------------------------------------------------------------------------------------------------------------
6. REFINISH MILLWORK AT SERVICE AREA 1.00 1,500.00 DEFERRED 1997
---------------------------------------------------------------------------------------------------------------
Page 2
------------------------------------------------------------------------------------------------------
7. REFINISH DANCE FLOOR 400.00 1.50 DEFERRED 1997
--------------------------------------------------------------------------------------------------------
8. PAINT CEILINGS 3,000.00 1.25 DEFERRED 1997
--------------------------------------------------------------------------------------------------------
0.00
D. PREFUNCTION SPACE 0.00
--------------------------------------------------------------------------------------------------------
1. REPLACE CEILING TILE - AS NEEDED 1.00 5,000.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
2. INSTALL UPHOLST SEATING CONSOLE TABLES 1.00 15,000.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
3. INSTALL END TABLES INCLUDED DEFER 1997
--------------------------------------------------------------------------------------------------------
4. INSTALL PROTABLE LIGHTING 1.00 1,500.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
5. INSTALL MISC. FURNISHINGS INCLUDED DEFER 1997
--------------------------------------------------------------------------------------------------------
6. REPLACE WINDOW TREATMENT 1.00 20,000.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
7. INSTALL SHEER/CASEMENT & OVERDRAPERY INCLUDED DEFER 1997
--------------------------------------------------------------------------------------------------------
8. REPLACE VINYL BASE W/ WOOD BASE 600.00 6.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
9. INSTALL ADA COMPLIANT SIGNAGE 1.00 2,500.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
0.00
E. BALLROOM 0.00
--------------------------------------------------------------------------------------------------------
1. REMOVE BRASS PANELS ON ENTRY DOOR 800 600.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
2. INSTALL APPLIED MOUNDINGS TO ENTRY DOOR INCLUDED DEFER 1997
--------------------------------------------------------------------------------------------------------
3. INSTALL LAMINATE R WOOD VENEER AS NEEDED INCLUDED DEFER 1997
--------------------------------------------------------------------------------------------------------
4. FIND SOLUTION TO ELIMNATE LIGHT LEAKS 1.00 5,000.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
IN SOFFITS AROUND PERIM OF CONFFERED AREA DEFER 1997
--------------------------------------------------------------------------------------------------------
5. INSTALL DECOR LIGHTING IN COFFERED AREA 1.00 6,000.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
0.00
F. MAJESTIC BALLROOM 0.00
--------------------------------------------------------------------------------------------------------
1. REPLACE VINYL WALLCOVERING 175.00 18.00 3,150.00
--------------------------------------------------------------------------------------------------------
2. INSTALL VINYL WALLCOVERING INCLUDED 0.00
--------------------------------------------------------------------------------------------------------
3. REPLACE CARPET & PAD 210.00 35.00 7,350.00
--------------------------------------------------------------------------------------------------------
4. INSTALL CARPET & PAD INCLUDED 0.00
--------------------------------------------------------------------------------------------------------
5. REPLACE WINDOW TREATMNT INCLUD BLACKOUT 1.00 8,000.00 8,000.00
--------------------------------------------------------------------------------------------------------
6. DETERMINE IF COLUMN CAN BE REMOVED M/R 0.00
--------------------------------------------------------------------------------------------------------
7. ELIMINATE BOX AT BASE OF COLUMN M/R 0.00
--------------------------------------------------------------------------------------------------------
8. REFINISH BASE MOULDING 144.00 3.00 432.00
--------------------------------------------------------------------------------------------------------
9. RE CONFIG SERV AREA TO CREATE VESTIBULE 1.00 3,500.00 3,500.00
--------------------------------------------------------------------------------------------------------
10. INSTALL DECORATIVE CEILING LIGHTING 1,250.00 3.50 4,410.00
--------------------------------------------------------------------------------------------------------
11. INSTALL ADA COMPLIANT SIGNAGE 1.00 400.00 400.00
--------------------------------------------------------------------------------------------------------
12. INSTALL CHAIR RAILS & OTHER DECOR MOULDINGS 144.00 12.00 1,728.00
--------------------------------------------------------------------------------------------------------
13. MISC. 1.00 2,780.00 2,780.00
--------------------------------------------------------------------------------------------------------
0.00
G. POOL AREA 0.00
--------------------------------------------------------------------------------------------------------
1. INSTALL CERMAIC TILER OTHER APPROVED 3,000.00 6.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
SURFACE OVER DECKING DEFER 1997
--------------------------------------------------------------------------------------------------------
2. REPLACE CARPET & PAD INCLUDED DEFER 1997
--------------------------------------------------------------------------------------------------------
3. INSTALL CARPET & PAD R APPROVED SURFACE INCLUDED DEFER 1997
--------------------------------------------------------------------------------------------------------
4. REPLACE VINYL BASE COORD W/FLOOR SURFACE INCLUDED DEFER 1997
--------------------------------------------------------------------------------------------------------
5. REPAIR & PAINT GYPSUM BOARD WALLS 1.00 5,000.00 DEFER 1997
--------------------------------------------------------------------------------------------------------
Page 3
------------------------------------------------------------------------------------------------------
6. INSTALL ADA COMPLIANT SIGNAGE 1.00 1,000.00 DEFER 1997
------------------------------------------------------------------------------------------------------
0.00
0.00
IV. PRIVATE GUEST AREAS 0.00
0.00
A. GUEST ROOM CORRIDOR 0.00
------------------------------------------------------------------------------------------------------
1. REPLACE VINYL BASE W/CARPET R WOOD 2,700.00 1.50 4,050.00
------------------------------------------------------------------------------------------------------
2. INSTALL ADA COMPLIANT SIGNAGE 213.00 85.00 18,105.00
------------------------------------------------------------------------------------------------------
3. PAINT DOORS & DOOR MOULDINGS 213.00 35.00 7,455.00
------------------------------------------------------------------------------------------------------
4. REPLACE SOFA IN ELEVATOR LOBBIES X EA FL 4.00 600.00 2,400.00
------------------------------------------------------------------------------------------------------
5. REPLACE CARPET INSET & PAD ELEV. LOBBY 1.00 800.00 800.00
------------------------------------------------------------------------------------------------------
6. INSTALL CARPET & PAD INCLUDED 0.00
------------------------------------------------------------------------------------------------------
7. REMAINING GRAPHICS PER ADA INCLUDED 0.00
------------------------------------------------------------------------------------------------------
0.00
------------------------------------------------------------------------------------------------------
0.00
B. GUEST ROOMS 0.00
------------------------------------------------------------------------------------------------------
1. INSTALL ADDITIONAL PHONE AT NIGHTSTAND 213.00 75.00 15,975.00
------------------------------------------------------------------------------------------------------
2. BEDSETS SAGGING CHECK WARRANTY 0.00
------------------------------------------------------------------------------------------------------
3. REFINISH DESKS 213.00 150.00 31,950.00
------------------------------------------------------------------------------------------------------
4. REPLACE NIGHTSTAND LAMPS 272.00 75.00 20,400.00
------------------------------------------------------------------------------------------------------
5. REPLACE DESK LAMP SHADES 213.00 40.00 8,520.00
------------------------------------------------------------------------------------------------------
6. INSTALL BATON PULL HARDWARE DRAPERY 213.00 100.00 21,300.00
------------------------------------------------------------------------------------------------------
7. INSTALL SOUND STRIP TO CONNECTING DOORS 80.00 25.00 2,000.00
------------------------------------------------------------------------------------------------------
8. REPLACE/PROF CLEAN OTTOMANS 68.00 100.00 6,800.00
------------------------------------------------------------------------------------------------------
9. 1998 REPLACE VWC & VINYL BASE 0.00
------------------------------------------------------------------------------------------------------
10. INSTALL ADDITIONAL SEATING IN SUITE PARLORS 2.00 2,500.00 5,000.00
------------------------------------------------------------------------------------------------------
12. REPLACE CASEGOODS IN ALL SUITE BEDROOMS 2.00 1,500.00 3,000.00
------------------------------------------------------------------------------------------------------
0.00
D. GUEST BATHROOMS 0.00
------------------------------------------------------------------------------------------------------
1. INSTALL SHOWER MASSAGE UNITS 213.00 35.00 7,455.00
------------------------------------------------------------------------------------------------------
2. REPLACE VINYL WALLCOVERING 213.00 150.00 31,950.00
------------------------------------------------------------------------------------------------------
3. INSTALL VINYL WALLCOVERING INCLUDED 0.00
------------------------------------------------------------------------------------------------------
4. ELIMINATE INSET UTILITY CABINETS 213.00 35.00 7,455.00
------------------------------------------------------------------------------------------------------
5. REPLACE NON SLIP SURFACE ON TUB BOTTOM 213.00 25.00 5,325.00
------------------------------------------------------------------------------------------------------
6. WRAP FACIA BOARD WITH VWC 213.00 25.00 5,325.00
------------------------------------------------------------------------------------------------------
7. REPLACE LOUVER W/CLEAR ACRYLIC PARAHEX LOUVER 213.00 100.00 21,000.00
------------------------------------------------------------------------------------------------------
8. REPLACE FLOURESCENT TUBES W/COLOR INDEX OF 82 INCLUDED 0.00
------------------------------------------------------------------------------------------------------
9. COLOR FLOOR GROUT DARK ▇▇▇▇ 213.00 65.00 13,845.00
------------------------------------------------------------------------------------------------------
?? RECOMMEND CHANGE FLOURESCENT LIGHT BALLAST INCLUDED 0.00
------------------------------------------------------------------------------------------------------
& TUBES TO CURRENT TECHNOLOGY 0.00
------------------------------------------------------------------------------------------------------
0.00
0.00
V. BACK OF THE HOUSE 0.00
0.00
Page 4
VI. MISCELLANEOUS 0.00
0.00
0.00
VII. GENERAL CONDITIONS 0.00
0.00
----------------------------------------------------------------------
A. GENERAL CONDITIONS 308,896.67 0.09 27,800.70
----------------------------------------------------------------------
B. DEPARTMENT INCENTIVES 308,896.67 0.01 2,316.73
----------------------------------------------------------------------
C. DEPARTMENT INCENTIVES 308,896.67 0.01 2,316.73
----------------------------------------------------------------------
0.00
0.00
--------------------------------------------------------------------------------
TOTAL 341,330.82
--------------------------------------------------------------------------------
Page 5
HOLIDAY INN
MADISON, WS
SUMMARY
PRODUCT IMPROVEMENT PLAN - HOLIDAY INN "CROWNE PLAZA"
--------------------------------------------------------------------------------
AREAS EST.COST
--------------------------------------------------------------------------------
I. LIFE SAFETY 0.00
II. LOBBY/ENTRANCE/FRONT DESK 106,469.00
III. PUBLIC RESTROOMS 1,050.00
IV. FOOD SERVICE FACILITIES 43,325.00
V. LOUNGE FACILITIES 151,200.00
VI. MEETING ROOMS 67,714.00
VII. HOLIDOME/ATRIUMS/POOL ENCLOSURES 10,000.00
VIII. INTERIOR CORRIDORS 104,011.00
IX. GUEST ROOMS 689,935.00
X. GUEST BATH ROOMS 113,475.00
XI. EXTERIOR 84,955.00
XII. MISCELLANEOUS 179,170.00
XIII. GENERAL CONDITIONS 162,886.92
--------------------------------------------------------------------------------
TOTAL 1,714,190.92
--------------------------------------------------------------------------------
Page 1
HOLIDAY INN
MADISON, WS
PRODUCT IMPROVEMENT PLAN - HOLIDAY INN "CROWNE PLAZA"
-----------------------------------------------------------------------------------------------------------
QUANTITY/ UNIT EST.
AREAS SCOPE OF WORK ALLOWANCE COST COST
-----------------------------------------------------------------------------------------------------------
I. LIFE SAFETY
A. FIRE SAFETY SYSTEM
-------------------------------------------------------------------------------------------------
1 MUST COMPLY WITH HOLIDAY INN'S STANDARDS COMPLIES 0.00
-------------------------------------------------------------------------------------------------
0.00
II. LOBBY/ENTRANCE/FRONT DESK 0.00
0.00
A. LOBBY 0.00
-------------------------------------------------------------------------------------------------
1 PROVIDE NEW DIRECTIONAL SIGNAGE INCLUDED IN GRAPHICS PACKAGE
-------------------------------------------------------------------------------------------------
2 ADD GLASS STORAGE TO TOP OF BAR 1.00 3,500.00 3,500.00
-------------------------------------------------------------------------------------------------
3 NEW LOBBY BAR CABINETS-UPGRADE 1.00 6,000.00 6,000.00
-------------------------------------------------------------------------------------------------
4 REFINISH CABINET NEXT TO PEARLS ENTRANCE INCLUDED 0.00
-------------------------------------------------------------------------------------------------
5 ENCASE LARGE SCREEN TV 1.00 1,000.00 1,000.00
-------------------------------------------------------------------------------------------------
6 NEW WINDOW TREATMENTS AT LOBBY BAR 1.00 800.00 800.00
-------------------------------------------------------------------------------------------------
7 REDESIGN SEATING AREA - TOO CROWDED 1.00 6,000.00 6,000.00
-------------------------------------------------------------------------------------------------
8 REPLACE MISMATCHED LAMPS 1.00 1,000.00 1,000.00
-------------------------------------------------------------------------------------------------
9 LOBBY BAR-LOWER LEVEL-REPLACE CHAIRS 30.00 250.00 7,500.00
-------------------------------------------------------------------------------------------------
10 LOBBY BAR-LOWER LEVEL-REPLACE TABLES 6.00 200.00 1,200.00
-------------------------------------------------------------------------------------------------
11 PROVIDE NEW ARTWORK THROUGHOUT LOBBY 1.00 5,000.00 5,000.00
-------------------------------------------------------------------------------------------------
12 MODIFY FACE OF GIFT SHOP - TOO CROWDED 1.00 4,000.00 4,000.00
-------------------------------------------------------------------------------------------------
13 REPLACE SHOE STAND-OVERSCALED 1.00 600.00 600.00
-------------------------------------------------------------------------------------------------
14 PROVIDE LOCKABLE LUGGAGE STORAGE 1.00 3,500.00 3,500.00
-------------------------------------------------------------------------------------------------
15 PROVIDE BUSINESS CENTER W/EQUIPMENT 1.00 6,000.00 6,000.00
-------------------------------------------------------------------------------------------------
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ OUT 1.00 3,500.00 3,500.00
-------------------------------------------------------------------------------------------------
17 LOW WALLS TO SEPARATE LOUNGE FROM LOBBY 70.00 100.00 7,000.00
-------------------------------------------------------------------------------------------------
18 AREA RUG IN FRONT OF FRONT DESK 1.00 2,500.00 2,500.00
-------------------------------------------------------------------------------------------------
19 REPLACE ALL SEATING/TABLES/LAMPS 1.00 8,000.00 8,000.00
-------------------------------------------------------------------------------------------------
20 REMOVE FAKE PALM TREES FROM LOBBY 8.00 3,000.00 24,000.00
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
B. FRONT DESK
-------------------------------------------------------------------------------------------------
1 ELIMINATE BACK COUNTER 1.00 150.00 150.00
-------------------------------------------------------------------------------------------------
2 ELIMINATE CLUTTER-SIDE CABINETS OPERATIONAL 0.00
-------------------------------------------------------------------------------------------------
3 RESURFACE BACK WALL 8.00 18.00 144.00
-------------------------------------------------------------------------------------------------
4 OWNER/OPERATOR SIGN 1.00 75.00 75.00
-------------------------------------------------------------------------------------------------
5 RELOCATE SAFE DEPOSIT BOXES TO ACCESS AREA RECOMMENDATION ONLY 0.00
-------------------------------------------------------------------------------------------------
Page 2
0.00
C. ADMIN. OFFICES 0.00
-------------------------------------------------------------------------------------------------------------------
1 UPGRADE WITH CARPET, FURNITURE, PAINT, ETC. 2,500.00 6.00 15,000.00
-------------------------------------------------------------------------------------------------------------------
0.00
III. PUBLIC RESTROOMS 0.00
0.00
A. LOBBY AREA 0.00
-------------------------------------------------------------------------------------------------------------------
1 REPLACE DATED WALL COVERING 30.00 18.00 540.00
-------------------------------------------------------------------------------------------------------------------
2 PROVIDE LEVER FAUCETS 6.00 85.00 510.00
-------------------------------------------------------------------------------------------------------------------
0.00
IV. FOOD SERVICE FACILITIES 0.00
0.00
A. ATRIUM DINING 0.00
-------------------------------------------------------------------------------------------------------------------
1 PROVIDE WALL DECOR INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------
2 REPLACE TABLE TOP DECOR 40.00 100.00 4,000.00
-------------------------------------------------------------------------------------------------------------------
3 OWNER/OPERATOR SIGN 1.00 75.00 75.00
-------------------------------------------------------------------------------------------------------------------
4 CLEAN/REFINISH TABLE BASES 40.00 50.00 2,000.00
-------------------------------------------------------------------------------------------------------------------
5 REPLACE WICKER CHAIRS 125.00 250.00 31,250.00
-------------------------------------------------------------------------------------------------------------------
6 REUPOLSTER BOOTHS 1.00 6,000.00 6,000.00
-------------------------------------------------------------------------------------------------------------------
0.00
V. LOUNGE FACILITIES 0.00
0.00
A. LOUNGE 0.00
-------------------------------------------------------------------------------------------------------------------
1 REFURBISH/REPLACE ENTRANCE DOORS 2.00 600.00 1,200.00
-------------------------------------------------------------------------------------------------------------------
2 HVAC-ADD VENTILATION FOR SMOKE M/R 0.00
-------------------------------------------------------------------------------------------------------------------
3 NEW CONCEPT 1.00 150,000.00 150,000.00
-------------------------------------------------------------------------------------------------------------------
VI. MEETING ROOMS 0.00
0.00
A. PRE-FUNCTION 0.00
-------------------------------------------------------------------------------------------------------------------
1 ELIMINATE BRASS TRIM FROM DOORS 16.00 400.00 6,400.00
-------------------------------------------------------------------------------------------------------------------
2 REPLACE CEILING TILES 1,328.00 3.00 3,984.00
-------------------------------------------------------------------------------------------------------------------
3 TILE AT SERVICE AREA 40.00 10.00 400.00
-------------------------------------------------------------------------------------------------------------------
4 REPLACE FURNISHINGS 1.00 2,500.00 2,500.00
-------------------------------------------------------------------------------------------------------------------
5 PROVIDE ADDITIONAL WALL DECOR 1.00 1,000.00 1,000.00
-------------------------------------------------------------------------------------------------------------------
6 REMOVE FROM TELEPHONE ENCLOSURES 1.00 500.00 500.00
-------------------------------------------------------------------------------------------------------------------
0.00
-------------------------------------------------------------------------------------------------------------------
0.00
B. MEETING BANQUET FACILITIES 0.00
-------------------------------------------------------------------------------------------------------------------
1 DOOR HARDWARE/FRAMES-REPAIR AS NEEDED 1.00 2,500.00 2,500.00
-------------------------------------------------------------------------------------------------------------------
2 REPLACE DRAPERY I PEBBLE/MADERIA ROOMS 2.00 800.00 1,600.00
-------------------------------------------------------------------------------------------------------------------
3 PROVIDE WALL DECOR IN SMALL MEETING ROOMS 1.00 800.00 800.00
-------------------------------------------------------------------------------------------------------------------
4 REPLACE NON-CONFORMING STACK CHAIRS 400.00 40.00 16,000.00
-------------------------------------------------------------------------------------------------------------------
5 REPLACE WORN LECTURNS 3.00 900.00 2,700.00
-------------------------------------------------------------------------------------------------------------------
Page 3
------------------------------------------------------------------------------------------------------
6 REPLACE CARPET IN BALLROOM 565.00 30.00 16,950.00
------------------------------------------------------------------------------------------------------
C. BOARD ROOM X 1 0.00
------------------------------------------------------------------------------------------------------
1 NEW BOARD TABLE WITH CHAIRS 1.00 9,600.00 9,600.00
------------------------------------------------------------------------------------------------------
2 NEW ARTWORK 1.00 400.00 400.00
------------------------------------------------------------------------------------------------------
3 NEW DRAPERY 1.00 800.00 800.00
------------------------------------------------------------------------------------------------------
4 NEW VWC 60.00 18.00 1,080.00
------------------------------------------------------------------------------------------------------
5 MISC. 1.00 500.00 500.00
------------------------------------------------------------------------------------------------------
0.00
VII. HOLIDOMES/ATRIUMS/POOL ENCLOSURES 0.00
0.00
A. EXERCISE ROOM 0.00
------------------------------------------------------------------------------------------------------
1 ENCLOSE FOR SECURITY 1.00 4,000.00 4,000.00
------------------------------------------------------------------------------------------------------
2 CLEAN FLOOR TILE FOR ACCEPTABLE CONDITION M/R 0.00
------------------------------------------------------------------------------------------------------
3 CONVERT SAUNA TO EXERCISE ROOM 1.00 6,000.00 6,000.00
------------------------------------------------------------------------------------------------------
0.00
VIII. INTERIOR CORRIDORS 0.00
0.00
A. VESTIBULES 0.00
------------------------------------------------------------------------------------------------------
1 REFINISH ALL CONSOLE TABLES AND MIRRORS 5.00 150.00 750.00
------------------------------------------------------------------------------------------------------
0.00
B. CORRIDORS 0.00
------------------------------------------------------------------------------------------------------
1 NEW GRAPHICS PACKAGE 227.00 105.00 23,835.00
------------------------------------------------------------------------------------------------------
2 REPLACE CEILING TILE FIRST FLOOR 1,092.00 3.00 3,276.00
------------------------------------------------------------------------------------------------------
3 REPLACE DRAPERY SHEERS ON ELEVATOR LANDINGS 5.00 500.00 2,500.00
------------------------------------------------------------------------------------------------------
4 PROVIDE WOOD FLOOR BASE 3,100.00 5.00 15,500.00
------------------------------------------------------------------------------------------------------
5 PROVIDE WOOD CHAIR RAIL 3,100.00 5.00 15,500.00
------------------------------------------------------------------------------------------------------
0.00
------------------------------------------------------------------------------------------------------
C. CLUB FLOOR
------------------------------------------------------------------------------------------------------
1 REPLACE CARPET 325.00 30.00 9,750.00
------------------------------------------------------------------------------------------------------
2 REPLACE VWC. 525.00 18.00 9,450.00
------------------------------------------------------------------------------------------------------
3 UPGRADE ELEVATOR LOBBY 250.00 25.00 6,250.00
------------------------------------------------------------------------------------------------------
4 PROVIDE WALL DECOR 12.00 100.00 1,200.00
------------------------------------------------------------------------------------------------------
5 PROVIDE CLUB LEVEL LOUNGE 1.00 16,000.00 16,000.00
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
0.00
IX. GUEST ROOMS 0.00
0.00
A. GUEST ROOMS 0.00
------------------------------------------------------------------------------------------------------
1 REPLACE VINYL WALL COVERING-CLUB LEVEL 42.00 600.00 25,200.00
------------------------------------------------------------------------------------------------------
2 REPLACE LIGHTING-TARNISHED 227.00 200.00 45,400.00
------------------------------------------------------------------------------------------------------
3 CASEGOODS - REFINISH 30.00 150.00 4,500.00
------------------------------------------------------------------------------------------------------
Page 4
------------------------------------------------------------------------------
4 REPLACE DRAPERY - TOO SHORT 227.00 450.00 102,150.00
------------------------------------------------------------------------------
5 DESK CHAIRS - TO MAKE 2 PER ROOM 90.00 125.00 11,250.00
------------------------------------------------------------------------------
6 REPLACE BEDSPREADS-CLUB LEVEL 42.00 170.00 7,140.00
------------------------------------------------------------------------------
7 PROVIDE DUST RUFFLE-CLUB LEVEL 42.00 170.00 7,140.00
------------------------------------------------------------------------------
8 MINI-REFRIGERATORS-CLUB LEVEL 42.00 150.00 6,300.00
------------------------------------------------------------------------------
9 PROVIDE CROWNE MOLDING-CLUB LEVEL 42.00 350.00 14,700.00
------------------------------------------------------------------------------
10 REPLACE BLONDE CASEGOODS 197.00 1,500.00 295,500.00
------------------------------------------------------------------------------
11 PROVIDE ARMOIRE FOR DARK CASE GOODS 30.00 400.00 12,000.00
------------------------------------------------------------------------------
12 SEATING PER CP STANDARDS 197.00 500.00 98,500.00
------------------------------------------------------------------------------
13 PROVIDE FRAMED FULL LENGTH MIRRORS 227.00 65.00 14,755.00
------------------------------------------------------------------------------
14 REPLACE WALL DECOR 227.00 200.00 45,400.00
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
0.00
X. GUEST BATH ROOMS 0.00
0.00
A. GUEST BATH ROOMS 0.00
------------------------------------------------------------------------------
1 REFINISH DOORS AND FRAMES 227.00 35.00 7,945.00
------------------------------------------------------------------------------
2 REPLACE WORN HARDWARE 227.00 25.00 5,675.00
------------------------------------------------------------------------------
3 PROVIDE STONE FLOOR-CLUB LEVEL 42.00 500.00 21,000.00
------------------------------------------------------------------------------
4 REPLACE VWC-CLUB LEVEL 42.00 175.00 7,350.00
------------------------------------------------------------------------------
5 PROVIDE CLOSET DOORS 227.00 300.00 68,100.00
------------------------------------------------------------------------------
6 PROVIDE CONTOURED WOOD HANGERS 227.00 15.00 3,405.00
------------------------------------------------------------------------------
7 REPLACE ANY DAMAGED VANITIES M/R 0.00
------------------------------------------------------------------------------
0.00
XI. EXTERIOR 0.00
0.00
A. COMMERCIAL BUILDING 0.00
------------------------------------------------------------------------------
1 PROVIDE STAMPED CONCRETE
UNDER PORTE COCHERE 1,200.00 6.00 7,200.00
------------------------------------------------------------------------------
2 CLEAN SURFACES TO ACCEPTABLE
CONDITION 1.00 60,000.00 60,000.00
------------------------------------------------------------------------------
3 CONCEAL DUMPSTER WITH SOLID
FENCE 1.00 2,500.00 2,500.00
------------------------------------------------------------------------------
4 FINISH SURROUNDS AT CHILLERS 1.00 500.00 500.00
------------------------------------------------------------------------------
0.00
B. PARKING LOT 0.00
------------------------------------------------------------------------------
1 FILL CRACKS/SEAL/RESTRIPE 227.00 65.00 14,755.00
------------------------------------------------------------------------------
0.00
XII. MISCELLANEOUS 0.00
0.00
A. REQUIRED ITEMS TO BE A CROWNE PLAZA 0.00
------------------------------------------------------------------------------
1 IDENTIFICATION SIGNAGE 1.00 50,000.00 50,000.00
------------------------------------------------------------------------------
2 PRINTED MATERIAL/ROOM SUPPLIES 227.00 125.00 28,375.00
------------------------------------------------------------------------------
3 UPGRADED LINENS 227.00 85.00 19,295.00
------------------------------------------------------------------------------
4 UNIFORMS 1.00 10,000.00 10,000.00
------------------------------------------------------------------------------
5 MISC. 1.00 15,000.00 15,000.00
------------------------------------------------------------------------------
Page 5
--------------------------------------------------------------------------
6 F&B SUPPLIES 1.00 20,000.00 20,000.00
--------------------------------------------------------------------------
0.00
--------------------------------------------------------------------------
0.00
--------------------------------------------------------------------------
B. ENGINEERING/ENVIROMENTAL
--------------------------------------------------------------------------
1 DRAINAGE PROBLEM 1.00 36,500.00 36,500.00
--------------------------------------------------------------------------
2
--------------------------------------------------------------------------
3
--------------------------------------------------------------------------
0.00
XIII. GENERAL CONDITIONS 0.00
0.00
A. ALLOWANCE 0.00
--------------------------------------------------------------------------
1 GENERAL CONDITIONS 1,551,304.00 0.09 139,617.36
--------------------------------------------------------------------------
2 DEPARTMENT INCENTIVES 1,551,304,00 0.01 11,634.78
--------------------------------------------------------------------------
3 DEPARTMENT OVERHEAD 1,551,304.00 0.01 11,634.78
--------------------------------------------------------------------------
--------------------------------------------------------------------------------
TOTAL 1,714,190.92
--------------------------------------------------------------------------------
Page ▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇
SUMMARY
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
--------------------------------------------------------------------------------
AREAS EST.COST
--------------------------------------------------------------------------------
I. EXTERIOR 12,700.00
II. BUILDING STRUCTURES 1,200.00
III. PUBLIC AREAS 6,500.00
IV. PRIVATE GUEST AREAS 28,800.00
V. BACK OF THE HOUSE
VI. MISCELLANEOUS
VII. GENERAL CONDITIONS 800.00
--------------------------------------------------------------------------------
TOTAL 50,000.00
--------------------------------------------------------------------------------
Page ▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
-------------------------------------------------------------------------------------------------------------
QUANITY/ UNIT EST.
AREAS SCOPE OF WORK ALLOWANCE COST COST
-------------------------------------------------------------------------------------------------------------
I. EXTERIOR
A. BISTRO COURTYARD
---------------------------------------------------------------------------------------------------
1. PATIO COVER 1.00 10,000.00 10,000.00
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
B. COTTAGES
---------------------------------------------------------------------------------------------------
1. IRON SECURITY GATES @ COTTAGES 1.00 2,700.00 2,700.00
---------------------------------------------------------------------------------------------------
- 0.00
II. BUILDING STRUCTURES 0.00
A. BISTRO BUILDING
---------------------------------------------------------------------------------------------------
1. ADD ONE GAS LIGHT 1.00 1,200.00 1,200.00
---------------------------------------------------------------------------------------------------
0.00
III. PUBLIC AREAS 0.00
0.00
A. LOBBY 0.00
---------------------------------------------------------------------------------------------------
1. REFINISH WOOD FLOOR INCLUDED IN GUESTROOM FLOORS
---------------------------------------------------------------------------------------------------
0.00
B. BISTRO REATAURANT 0.00
---------------------------------------------------------------------------------------------------
1. BRASS MENU BOX 1.00 2,000.00 2,000.00
---------------------------------------------------------------------------------------------------
2. REFRIGERATED WINE STORAGE 1.00 2,000.00 2,000.00
---------------------------------------------------------------------------------------------------
3. MICROS CASH REGISTERS 1.00 2,500.00 2,500.00
---------------------------------------------------------------------------------------------------
0.00
IV. PRIVATE GUEST AREAS 0.00
0.00
A. GUEST ROOMS 0.00
---------------------------------------------------------------------------------------------------
1. REMOVE GOLD CARPET AND REFINISH EXIST WOOD FLS. 1.00 11,800.00 11,800.00
---------------------------------------------------------------------------------------------------
2. PROVIDE AREA RUGS FOR WOOD FLOORS 1.00 8,000.00 8,000.00
---------------------------------------------------------------------------------------------------
3. REFINISH 2 BATH TUBS 2.00 250.00 500.00
---------------------------------------------------------------------------------------------------
4. MISC FURNITURE REFINISHING 1.00 2,500.00 2,500.00
---------------------------------------------------------------------------------------------------
5. NEW HVAC FOR ROOM NO.2 1.00 3,500.00 3,500.00
---------------------------------------------------------------------------------------------------
6. CORRECT WINDOW PROBLEM 1.00 2,500.00 2,500.00
---------------------------------------------------------------------------------------------------
0.00
V. BACK OF THE HOUSE 0.00
0.00
Page 2
VI. MISCELLANEOUS 0.00
0.00
VII. GENERAL CONDITIONS 0.00
0.00
----------------------------------------------------------------------
A. GENERAL CONDITIONS 1.00 800.00 800.00
----------------------------------------------------------------------
B. DEPARTMENT INCENTIVES 0.00 0.01 0.00
----------------------------------------------------------------------
C. DEPARTMENT INCENTIVES 0.00 0.01 0.00
----------------------------------------------------------------------
0.00
0.00
--------------------------------------------------------------------------------
TOTAL 50,000.00
--------------------------------------------------------------------------------
Page 3
HOLIDAY INN "SELECT"
NEW ORLEANS, LA. - AIRPORT
SUMMARRY
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
--------------------------------------------------------------------------------
AREAS EST.COST
--------------------------------------------------------------------------------
1. EXTERIOR 5,500.00
11. BUILDING STRUCTURES 28,000.00
111. PUBLIC AREAS 167,350.00
1V. PRIVATE GUEST AREAS 1,518,174.00
V. MECHANICAL - ELECTRICAL 500.00
V1. MISCELLANEOUS 357,020.00
V11. GENERAL CONDITIONS 218,037.12
--------------------------------------------------------------------------------
TOTAL 2,294,581.12
--------------------------------------------------------------------------------
Page 1
HOLIDAY INN "SELECT"
NEW ORLEANS, LA. - AIRPORT
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
------------------------------------------------------------------------------------------------------------------------------------
RE'D QUANTITY/ UNIT EST.
AREAS SCOPE OF WORK YES ALLOWANCE COST COST
------------------------------------------------------------------------------------------------------------------------------------
I. EXTERIOR
A. SIGNAGE
--------------------------------------------------------------------------------------------------------------------------
1. CVR BRICK @ BASE OF PRIMARY SIGN 1.00 1,500.00 1,500.00
--------------------------------------------------------------------------------------------------------------------------
WITH SYNTHETIC STUCCO 0.00
--------------------------------------------------------------------------------------------------------------------------
2. CVR BRICK @ BASE OF ENTRY SIGN 1.00 1,500.00 1,500.00
--------------------------------------------------------------------------------------------------------------------------
WITH SYNTHETIC STUCCO 0.00
--------------------------------------------------------------------------------------------------------------------------
0.00
B. DUMPSTER SCREENING 0.00
--------------------------------------------------------------------------------------------------------------------------
1. UPGRADE DUMPSTER SCREEN 1.00 2,500.00 2,500.00
--------------------------------------------------------------------------------------------------------------------------
0.00
11. BUILDING STRUCTURES 0.00
0.00
A. RENTAL UNIT BUILDINGS 0.00
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE WINDOWS/FRAMES - AS NEEDED 140.00 200.00 28,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REMOVE EXTERIOR ENTRANCES 60.00 1,200.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
0.00
11. PUBLIC AREAS 0.00
0.00
A. VESTIBULE 0.00
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH CEILING 1.00 250.00 250.00
--------------------------------------------------------------------------------------------------------------------------
0.00
B. LOBBY 0.00
--------------------------------------------------------------------------------------------------------------------------
1. UPGRADE INTERIOR SIGNAGE 304.00 125.00 38,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE CEILING TILES - DAMAGED 1,500.00 2.00 3,000.00
--------------------------------------------------------------------------------------------------------------------------
3. REPAIR CEILING GRID SYSTEM 1,500.00 1.00 1,500.00
--------------------------------------------------------------------------------------------------------------------------
4. REPLACE HVAC VENTS - RUSTED 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
0.00
C. FRONT DESK 0.00
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH FACING OF FRONT DESK 20.00 50.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REFINISH CEILING - AS NEEDED 150.00 2.00 300.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE CARPET & PAD BEHIND FRONT DESK 60.00 20.00 1,200.00
--------------------------------------------------------------------------------------------------------------------------
4. REFINISH ▇▇▇▇ STAND 1.00 250.00 250.00
--------------------------------------------------------------------------------------------------------------------------
0.00
D. LOBBY CORRIDOR 0.00
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE CEILING TILES 1,000.00 2.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
Page 2
--------------------------------------------------------------------------------------------------------------------------
2. REPAIR DAMAGED GRIDS 1.00 500.00 500.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE HVAC VENTS 1.00 250.00 250.00
--------------------------------------------------------------------------------------------------------------------------
0.00
E. BANQUET ROOMS - NO. & SQ. FT 0.00
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH ENTRY & SERVICE DOOR/FRAMES 9.00 200.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE DOOR HARDWARE AS NEEDED 1.00 2,500.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
3. PROVIDE UPDATED DOOR SIGNAGE INCLUDED DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
4. REPAIR CEILING GRID SYSTEM 4,400.00 1.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE CEILING TILE - AS NEEDED 4,400.00 2.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
6. REPLACE VINYL WALLCOVERING 375.00 18.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
7. INSTALL VINYL WALLCOVERING INCLUDED DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
8. REFINISH BASEBOARD & CHAR RAIL 200.00 6.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
9. REPLACE MOVABLE WALL FINISHES INCLUDED DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
10. REPLACE CARPET & PAD 586.80 30.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
11. INSTALL CARPET & PAD INCLUDED DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
12. PROVIDE UPGRADED WALL DECOR 1.00 3,000.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
13. PROVIDE PROPER COMBO OF LIGHTING X RMS 4,400.00 3.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
14. PROVIDE LIGHT DIMMER SWITCHES X RMS 1.00 2,000.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
15. PROVIDE WALL SCONCES 20.00 300.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
16. REPAIR PODIUM 3.00 900.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
0.00
F. LOUNGE/RESTAURANT 0.00
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH DOOR/FRAMES INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE CEILING TILES - AS NEEDED INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
3. REPAIR GRID SYSTEM INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
4. REPAIR VENTS - RUSTED INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
5. UPGRADE ALL LOUNGE SIGNAGE INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
6. REFINISH BAR STOOLS INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
7. REFINISH BAR ARM REST INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
8. RECONDITION BAR FACING INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
9. REPLACE WALL COVERING ON BAR FRONT INCLUDED 0.00
--------------------------------------------------------------------------------------------------------------------------
10. MISC. NOTED ABOVE 1.00 15,000.00 15,000.00
--------------------------------------------------------------------------------------------------------------------------
11. NEW CONCEPT FOR DINING 1.00 85,000.00 85,000.00
--------------------------------------------------------------------------------------------------------------------------
0.00
G. SAUNA 0.00
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH WOOD X.00 800.00 800.00
--------------------------------------------------------------------------------------------------------------------------
0.00
H. HOLIDOME AREAS 0.00
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE WINDOWS - AS NEEDED 60.00 200.00 12,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REPAINT RAILS DOME AREA 1.00 4,500.00 4,500.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE JAL LOUVERS W/STORE FRONT PANEL 4.00 200.00 800.00
--------------------------------------------------------------------------------------------------------------------------
4. REPLACE WALL ANDE POLE LIGHT FIXTURES 77.00 150.00 DEFER TO 1998
--------------------------------------------------------------------------------------------------------------------------
0.00
I. SEATING TERRACE LEVEL 0.00
Page 3
------------------------------------------------------------------------------------------------
1. REPLACE CHAIRS 1.00 9,000.00 DEFER TO 1998
------------------------------------------------------------------------------------------------
2. REPLACE COUCHES INCLUDED 0.00
------------------------------------------------------------------------------------------------
3. REPLACE TABLES INCLUDED 0.00
------------------------------------------------------------------------------------------------
J. HOLIDOME RESTROOMS 0.00
------------------------------------------------------------------------------------------------
1. PROVIDE UPGRADED SIGNAGE COMPLY/ADA INCLUDED 0.00
------------------------------------------------------------------------------------------------
2. REPLACE HAND & KICKPLATES DOORS INCLUDED 0.00
------------------------------------------------------------------------------------------------
3. REFINISH DOORS/FRAMES INCLUDED 0.00
------------------------------------------------------------------------------------------------
4. REPLACE ALL CERAMIC TILE (6' TILE MINIMUM) INCLUDED 0.00
------------------------------------------------------------------------------------------------
5. INSTALL CERAMIC TILE (6' TILE MINIMUM) INCLUDED 0.00
------------------------------------------------------------------------------------------------
6. REPLACE VINYL WALL COVERING INCLUDED 0.00
------------------------------------------------------------------------------------------------
7. INSTALL VINYL WALL COVERING INCLUDED 0.00
------------------------------------------------------------------------------------------------
8. REPLACE 1X1 FLOOR TILE W/4X4 NEUTRAL INCLUDED 0.00
------------------------------------------------------------------------------------------------
9. PROVIDE CERAMIC COVER BASE TILE INCLUDED 0.00
------------------------------------------------------------------------------------------------
10. REPLACE LIGHT FIXTURES INCLUDED 0.00
------------------------------------------------------------------------------------------------
11. PROVIDE VANITIES AS PER STANDARD INCLUDED 0.00
------------------------------------------------------------------------------------------------
12. PROVIDE SKIRTING (10") AS PER STANDARD INCLUDED 0.00
------------------------------------------------------------------------------------------------
13. REPLACE BASINS - AS NEEDED INCLUDED 0.00
------------------------------------------------------------------------------------------------
14. REPLACE SINK HARDWARE - TARNISHED INCLUDED 0.00
------------------------------------------------------------------------------------------------
15. REPLACE MIRRORS - DESILVERED INCLUDED 0.00
------------------------------------------------------------------------------------------------
16. PROVIDE SOAP DISPENSERS INCLUDED 0.00
------------------------------------------------------------------------------------------------
17. PROVIDE SEMI RECESSED STEEL TOWEL DISPENS INCLUDED 0.00
------------------------------------------------------------------------------------------------
18. PROVIDE WASTE RECEPTACLE INCLUDED 0.00
------------------------------------------------------------------------------------------------
19. REPLACE PARTITION WALLS INCLUDED 0.00
------------------------------------------------------------------------------------------------
20. PROVIDE RSRVE TISSUE DISPENS PER/STANDARD INCLUDED 0.00
------------------------------------------------------------------------------------------------
21. REPLACE COMMODE SEATS & LIDS INCLUDED 0.00
------------------------------------------------------------------------------------------------
22. REPLACE COMMODE HARDWARE - TARNISHED INCLUDED 0.00
------------------------------------------------------------------------------------------------
23. REPLACE SHOWER STALL FINISHES INCLUDED 0.00
------------------------------------------------------------------------------------------------
24. REPLACE SHOWER STALL FURNISHINGS INCLUDED 0.00
------------------------------------------------------------------------------------------------
25. REPLACE SHOWER STALL FIXTURES INCLUDED 0.00
------------------------------------------------------------------------------------------------
26. PROVIDE EMERGENCY LIGHTS AS PER STANDARD INCLUDED 0.00
------------------------------------------------------------------------------------------------
27. COMPLETE RENOVATION REQUIRED 2.00 12,000.00 DEFER TO 1998
------------------------------------------------------------------------------------------------
0.00
IV. PRIVATE GUEST AREAS 0.00
0.00
A. GUEST ROOM CORRIDOR 0.00
------------------------------------------------------------------------------------------------
1. MAJOR RENOVATION REQUIRED 0.00
------------------------------------------------------------------------------------------------
2. PROVIDE DIRECTIONAL SIGNAGE INCLUDED 0.00
------------------------------------------------------------------------------------------------
3. REPLACE VINYL WALLCOVERING 3,293.00 18.00 59,274.00
------------------------------------------------------------------------------------------------
4. INSTALL VINYL WALLCOVERING INCLUDED 0.00
------------------------------------------------------------------------------------------------
5. REPLACE CARPET & PAD 1,646.00 30.00 49,380.00
------------------------------------------------------------------------------------------------
6. INSTALL CARPET & PAD INCLUDED 0.00
------------------------------------------------------------------------------------------------
7. REPAINT GUEST ROOM DOORS/FRAMES 304.00 35.00 10,640.00
------------------------------------------------------------------------------------------------
Page 4
---------------------------------------------------------------------------------------------------------
8. PROVIDE UPGRADED CORRIDOR LIGHTING 150.00 125.00 18,750.00
---------------------------------------------------------------------------------------------------------
0.00
C. GUEST ROOMS 0.00
---------------------------------------------------------------------------------------------------------
1. REPAINT DOOR FRAMES - AS NEEDED 304.00 35.00 10,640.00
---------------------------------------------------------------------------------------------------------
2. PROVIDE UPGRADED NUMBERS PKG PER ADA INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
3. REPLACE SELF CLOSING HARDWARE - AS NEED 100.00 45.00 4,500.00
---------------------------------------------------------------------------------------------------------
4. REPLACE JALOUSIES LOUVERS (GST RM ENTRY) 4.00 100.00 400.00
---------------------------------------------------------------------------------------------------------
W/STORE FRONT PANEL 0.00
---------------------------------------------------------------------------------------------------------
5. PAINT STOREFRONT PANEL/MATCH GST RM DOOR INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
6. PAINT CONNECTING DOORS 60.00 25.00 1,500.00
---------------------------------------------------------------------------------------------------------
7. REFINISH CEILINGS - AS NEEDED 304.00 100.00 30,400.00
---------------------------------------------------------------------------------------------------------
8. REPLACE VINYL WALLCOVERING 304.00 800.00 243,200.00
---------------------------------------------------------------------------------------------------------
9. INSTALL VINYL WALLCOVERING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
10. REPLACE CARPET & PAD 304.00 455.00 138,320.00
---------------------------------------------------------------------------------------------------------
11. INSTALL CARPET & PAD INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
12. REPLACE DRAPES - SIZE 304.00 200.00 60,800.00
---------------------------------------------------------------------------------------------------------
13. REPLACE BEDSPREADS - KING 128.00 85.00 10,880.00
---------------------------------------------------------------------------------------------------------
14. REPLACE BEDSPREADS - FULL XL 350.00 75.00 26,250.00
---------------------------------------------------------------------------------------------------------
15. REPLACE MATTRESS - KING 30.00 300.00 9,000.00
---------------------------------------------------------------------------------------------------------
16. REPLACE MATTRESS - FULL XL 26.00 200.00 5,200.00
---------------------------------------------------------------------------------------------------------
17. REPLACE PILLOWS 1,216.00 4.50 5,472.00
---------------------------------------------------------------------------------------------------------
18. REPLACE LINEN 304.00 85.00 25,840.00
---------------------------------------------------------------------------------------------------------
19. PROVIDE FULL LENGTH MIRROR X EA ROOM 304.00 45.00 13,680.00
---------------------------------------------------------------------------------------------------------
20. REPLACE MIRRORS - DESILVERED 110.00 130.00 14,300.00
---------------------------------------------------------------------------------------------------------
21. REPLACE/UPGRADE CASE GOODS 304.00 1,100.00 334,400.00
---------------------------------------------------------------------------------------------------------
22. REPLACE CREDENZA LIGHT FIXTURES 304.00 200.00 60,800.00
---------------------------------------------------------------------------------------------------------
23. REPLACE ACTIVITY LIGHT FIXTURES INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
24. REPLACE BED LIGHT FIXTURES INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
25. RELOCATE ALARM CLOCK RADIO TO BEDSIDE COMPLIES
---------------------------------------------------------------------------------------------------------
26. CONCEAL ELECTRIC CORDS 203.00 15.00 3,045.00
---------------------------------------------------------------------------------------------------------
0.00
D. GUEST BATHROOMS 0.00
---------------------------------------------------------------------------------------------------------
1. PAINT ENTRY DOOR/FRAME 304.00 35.00 10,640.00
---------------------------------------------------------------------------------------------------------
2. REPLACE THRESHOLDS 304.00 25.00 7,600.00
---------------------------------------------------------------------------------------------------------
3. REPLACE 1X1 FLOOR TILE W/4X4 NEUTRAL 304.00 300.00 91,200.00
---------------------------------------------------------------------------------------------------------
4. REPLACE VINYL WALLCOVERING 304.00 125.00 38,000.00
---------------------------------------------------------------------------------------------------------
5. INSTALL VINYL WALLCOVERING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
6. REPLACE CEILING TILES - DAMAGED 304.00 35.00 10,640.00
---------------------------------------------------------------------------------------------------------
7. REPAIR CEILING GRID SYSTEM 304.00 15.00 4,560.00
---------------------------------------------------------------------------------------------------------
8. REPLACE VANITIES 125.00 300.00 37,500.00
---------------------------------------------------------------------------------------------------------
9. REPLACE SINKS 125.00 300.00 37,500.00
---------------------------------------------------------------------------------------------------------
10. REPLACE VANITY HARDWARE 125.00 85.00 10,625.00
---------------------------------------------------------------------------------------------------------
11. REPLACE TISSUE DISPENSERS 125.00 12.00 1,500.00
---------------------------------------------------------------------------------------------------------
12. REPLACE VANITY LIGHT W/UPDATED FIXTURES 125.00 150.00 18,750.00
---------------------------------------------------------------------------------------------------------
Page 5
---------------------------------------------------------------------------------------------------------
13. REPLACE VANITY MIRRORS 304.00 125.00 38,000.00
---------------------------------------------------------------------------------------------------------
14. REFINISH/REPLACE TUBS 304.00 25.00 7,600.00
---------------------------------------------------------------------------------------------------------
15. REPLACE BATHTUB HARDWARE 304.00 85.00 25,840.00
---------------------------------------------------------------------------------------------------------
16. REPLACE NON-SLIP TREATMENT 304.00 15.00 4,560.00
---------------------------------------------------------------------------------------------------------
17. REPAIR TUB TILE GROUTING 1.00 7,500.00 7,500.00
---------------------------------------------------------------------------------------------------------
18. REPLACE GRAB BARS 304.00 25.00 7,600.00
---------------------------------------------------------------------------------------------------------
19. REPLACE COMMODE SEATS/LIDS 304.00 25.00 7,600.00
---------------------------------------------------------------------------------------------------------
20. REPLACE TOILET TISSUE HOLDER 304.00 35.00 10,640.00
---------------------------------------------------------------------------------------------------------
21. PROVIDED CHROME RSVE TISSUE HOLDER X EA RM INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
22. REPLACE SHOWER CURTAINS 304.00 12.00 3,648.00
---------------------------------------------------------------------------------------------------------
0.00
V. MECHANICAL - ELECTRICAL 0.00
0.00
A. LAUNDRY (BACK OF HOUSE) 0.00
---------------------------------------------------------------------------------------------------------
1. PROVIDE SMOKE DETECTOR OR SPRINKLER HEAD 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------
0.00
B. FIRE SAFETY SYSTEM 0.00
---------------------------------------------------------------------------------------------------------
1. WRITTEN DOC MUST BE SUBMITTED TO HOLIDAY INN COMPLIES 0.00
---------------------------------------------------------------------------------------------------------
CERTIFYING SYTEMS MEETS R EXCEEDS HI STANDARDS 0.00
---------------------------------------------------------------------------------------------------------
0.00
VI. MISCELLANEOUS 0.00
0.00
A. OPERATIONAL REQUIREMENTS 0.00
---------------------------------------------------------------------------------------------------------
1. F & B EQUIPMENT/SUPPLIES 1.00 15,000.00 15,000.00
---------------------------------------------------------------------------------------------------------
2. UNIFORMS 1.00 15,000.00 15,000.00
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
B. ADDITIONAL ITEMS TO BE A "SELECT" 0.00
---------------------------------------------------------------------------------------------------------
1. UPGRADE FITNESS CENTER 1.00 12,000.00 12,000.00
---------------------------------------------------------------------------------------------------------
2. PROVIDE 2 PHONES IN EACH ROOM 196.00 75.00 14,700.00
---------------------------------------------------------------------------------------------------------
3. HAIR DRYER IN ROOMS 304.00 25.00 7,600.00
---------------------------------------------------------------------------------------------------------
4. IRON, IRONING BOARD, HANGER 304.00 4.00 1,216.00
---------------------------------------------------------------------------------------------------------
5. UPGRADE COAT HANGERS 1.00 1,500.00 1,500.00
---------------------------------------------------------------------------------------------------------
6. PROVIDE MAKEUP MIRRORS 304.00 75.00 22,800.00
---------------------------------------------------------------------------------------------------------
7. UPGRADE LINEN/▇▇▇▇▇ 1.00 30,000.00 30,000.00
---------------------------------------------------------------------------------------------------------
8. PROVIDE CROWNE MOLDING 304.00 100.00 30,400.00
---------------------------------------------------------------------------------------------------------
9. PROVIDE 2 PARLOR BEDROOM SUITES 2.00 7,500.00 15,000.00
---------------------------------------------------------------------------------------------------------
10. PROVIDE SHOWER CURTAIN W/LINER 304.00 24.00 7,204.00
---------------------------------------------------------------------------------------------------------
11. FAX MACHINE IN 5 ROOMS 5.00 500.00 2,500.00
---------------------------------------------------------------------------------------------------------
12. EXECUTIVE ROOMS - DRAPERY VALANCES 20.00 250.00 5,000.00
---------------------------------------------------------------------------------------------------------
13. EXECUTIVE ROOMS - CORNICE MOLDING 20.00 300.00 6,000.00
---------------------------------------------------------------------------------------------------------
14. EXECUTIVE ROOMS - CLOSET W/DOORS 20.00 300.00 6,000.00
---------------------------------------------------------------------------------------------------------
Page 6
---------------------------------------------------------------------------------------------------------
15. EXECUTIVE ROOMS - LOGO BATH ROBES 2.00 20.00 40.00
---------------------------------------------------------------------------------------------------------
16. EXECUTIVE ROOMS - AMENITIES TRAY 1.00 60.00 60.00
---------------------------------------------------------------------------------------------------------
17. EXECUTIVE ROOMS - UPGRADED ROOMS 20.00 2,000.00 40,000.00
---------------------------------------------------------------------------------------------------------
18. SIGNAGE 1.00 75,000.00 75,000.00
---------------------------------------------------------------------------------------------------------
19. LOGO/PRINTED MATERIALS 1.00 30,000.00 30,000.00
---------------------------------------------------------------------------------------------------------
20. MISC. CONVERSION ITEMS 1.00 20,000.00 20,000.00
---------------------------------------------------------------------------------------------------------
21.
---------------------------------------------------------------------------------------------------------
22.
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
0.00
VII. GENERAL CONDITIONS 0.00
0.00
---------------------------------------------------------------------------------------------------------
A. GENERAL CONDITIONS 2,076,544.00 0.09 186,888.96
---------------------------------------------------------------------------------------------------------
B. DEPARTMENT INCENTIVES 2,076,544.00 0.01 15,574.08
---------------------------------------------------------------------------------------------------------
C. DEPARTMENT OVERHEAD 2,076,544.00 0.01 15,574.08
---------------------------------------------------------------------------------------------------------
0.00
0.00
-------------------------------------------------------------------------------------------------------------------
TOTAL: 2,294,581.12
-------------------------------------------------------------------------------------------------------------------
Page 7
HOLIDAY INN - ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
SUMMARY
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
--------------------------------------------------------
AREAS EST.COST
--------------------------------------------------------
I. EXTERIOR 0.00
II. BUILDING STRUCTURES 0.00
III. PUBLIC AREAS 38,745.00
IV. PRIVATE GUEST AREAS 158,371.00
V. BACK OF THE HOUSE 21,805.00
VI. MECHANICAL - ELECTRICAL
VII. GENERAL CONDITIONS 22,986.70
--------------------------------------------------------
TOTAL 241,907.71
--------------------------------------------------------
Page 1
HOLIDAY INN - ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
--------------------------------------------------------------------------------------------------------------------
RE'D QUANTITY/ UNIT EST.
AREAS SCOPE OF WORK YES ALLOWANCE COST COST
--------------------------------------------------------------------------------------------------------------------
I. EXTERIOR
II. PUBLIC AREAS 0.00
0.00
A. RESTAURANT 0.00
-----------------------------------------------------------------------------------------------------------
1. REVISE SEATING LAYOUT 1.00 30,000.00 30,000.00
-----------------------------------------------------------------------------------------------------------
0.00
B. MEETING ROOMS 0.00
-----------------------------------------------------------------------------------------------------------
1. EXECUTIVE SUITES-REPLACE CARPET 150.00 30.00 4,500.00
-----------------------------------------------------------------------------------------------------------
0.00
C. PUBLIC RESTROOMS 0.00
-----------------------------------------------------------------------------------------------------------
1. FLOOR DISCOLORED 1.00 1,000.00 1,000.00
-----------------------------------------------------------------------------------------------------------
2. FITNESS CENTER-FLOOR DISCOLORED 1.00 1,000.00 1,000.00
-----------------------------------------------------------------------------------------------------------
3. BANQUET-FIXTURES TARNISHED 1.00 1,000.00 1,000.00
-----------------------------------------------------------------------------------------------------------
0.00
D. RECREATION AREA 0.00
-----------------------------------------------------------------------------------------------------------
1. EQUIPMENT BENCH TORN-EX.RM. 1.00 200.00 200.00
-----------------------------------------------------------------------------------------------------------
2. WALL CLOCK-EX.RM. 1.00 45.00 45.00
-----------------------------------------------------------------------------------------------------------
3. WHIRLPOOL-DISCOLORED 1.00 1,000.00 1,000.00
-----------------------------------------------------------------------------------------------------------
0.00
IV. PRIVATE GUEST AREAS 0.00
0.00
A. GUEST ROOM CORRIDOR 0.00
-----------------------------------------------------------------------------------------------------------
1. REPLACE WALL COVERING 2,527.00 18.00 45,486.00
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
0.00
B. GUEST ROOMS 0.00
-----------------------------------------------------------------------------------------------------------
1. PRINTED MATERIALS 1.00 5,0O0.O0 5,000.00
-----------------------------------------------------------------------------------------------------------
2. CLOTHES HANGERS-INADEQUATE SUPPLY 1.00 2,500.00 2,500.00
-----------------------------------------------------------------------------------------------------------
3. REPLACE DESILVERED FULL LENGTH MIRRORS 100.00 65.00 6,500.00
-----------------------------------------------------------------------------------------------------------
4. LIGHT FIXTURES TARNISHED 120.00 200.00 24,000.00
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
0.00
D. GUEST BATHROOMS 0.00
-----------------------------------------------------------------------------------------------------------
1. REPLACE TILE FLOORS X 50% 122.00 300.00 36,600.00
-----------------------------------------------------------------------------------------------------------
2. CLEAN/REPAIR TILE FLOORS 50% 121.00 85.00 10,285.00
-----------------------------------------------------------------------------------------------------------
Page 2
-----------------------------------------------------------------------------------------------
3. TUB ▇▇▇▇▇ BY DRAIN-REPAIR 80.00 350.00 28,000.00
-----------------------------------------------------------------------------------------------
0.00
V. BACK OF THE HOUSE 0.00
0.00
A. HOUSEKEEPING 0.00
0.00
B. OPERATIONAL REQUIREMENTS
-----------------------------------------------------------------------------------------------
1. BANQUET, F & B EQUIPMENT 1.00 21,805.00 21,805.00
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
VI. MECHANICAL - ELECTRICAL 0.00
0.00
VII. GENERAL CONDITIONS 0.00
0.00
-----------------------------------------------------------------------------------------------
A. GENERAL CONDITIONS 218,921.00 0.09 19,702.89
-----------------------------------------------------------------------------------------------
B. DEPARTMENT INCENTIVES 218,921.00 0.01 1,641.91
-----------------------------------------------------------------------------------------------
C. DEPARTMENT OVERHEAD 218,921.00 0.01 1,641.91
-----------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------
TOTAL: 241,907.71
--------------------------------------------------------------------------------------------------------
Page 3
HOLIDAY INN - ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇
SUMMARY
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
--------------------------------------------------------------------------------
AREAS EST.COST
--------------------------------------------------------------------------------
I. EXTERIOR 53,969.00
II. BUILDING STRUCTURES 389,600.00
III. PUBLIC AREAS 230,508.33
IV. PRIVATE GUEST AREAS 1,016,461.50
V. BACK OF THE HOUSE 15,000.00
VI. MECHANICAL - ELECTRICAL 0.00
VII. GENERAL CONDITIONS 179,081.58
--------------------------------------------------------------------------------
TOTAL 1,884,620.41
--------------------------------------------------------------------------------
Page 1
HOLIDAY INN - DFW SOUTH
IRVING, TX
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
---------------------------------------------------------------------------------------------------------------------------
RE'D QUANITY UNIT EST.
AREAS SCOPE OF WORK YES ALLOWANCE COST COST
---------------------------------------------------------------------------------------------------------------------------
1. EXTERIOR
A. PARKING LOT SURFACE
-------------------------------------------------------------------------------------------------------------
1. REPAIR PARKING LOT 1.00 10,000.00 10,000.00
-------------------------------------------------------------------------------------------------------------
2. RESEAL PARKING LOT 407.00 40.00 16,280.00
-------------------------------------------------------------------------------------------------------------
3. RESTRIPE PARKING LOT 407.00 7.00 2,849.00
-------------------------------------------------------------------------------------------------------------
0.00
B. PARKING LOT LIGHTING 0.00
-------------------------------------------------------------------------------------------------------------
1. REPAIR DAMAGED CONCRETE BASES 1.00 2,500.00 2,500.00
-------------------------------------------------------------------------------------------------------------
2. REPAINT RUSTED LIGHT POLES 1.00 5,000.00 5,000.00
-------------------------------------------------------------------------------------------------------------
0.00
0.00
C. EXTERIOR SWIMMING POOL AREA 0.00
-------------------------------------------------------------------------------------------------------------
1. COVER POOL ENTRANCE W/SYNTHETIC STUCCO 640.00 6.00 3,840.00
-------------------------------------------------------------------------------------------------------------
2. REPAINT POOL FENCE/REPLACE 300.00 45.00 13,500.00
-------------------------------------------------------------------------------------------------------------
0.00
0.00
II. BUILDING STRUCTURES 0.00
A. COVERED DRIVE (CANOPIES) 0.00
-------------------------------------------------------------------------------------------------------------
1. HI APPROVED MATERIAL TO ENHANCE ROOF LINE 1.00 50,000.00 50,000.00
-------------------------------------------------------------------------------------------------------------
0.00
B. SATELLITE DISH SCREENING 0.00
-------------------------------------------------------------------------------------------------------------
1. PROVIDE SYNTHETIC STUCCO FINISH 1.00 5,000.00 5,000.00
-------------------------------------------------------------------------------------------------------------
0.00
C. RENTAL UNIT BUILDINGS 0.00
-------------------------------------------------------------------------------------------------------------
1. HI APPROVED MATERIAL TO ENHANCE ROOF LINE 1.00 200,000.00 200,000.00
-------------------------------------------------------------------------------------------------------------
2. HI APPROVED ARCHITECTUAL FEATURES/ROOFLINE INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------
3. REPLACE DAMAGED WINDOWS 100.00 200.00 20,000.00
-------------------------------------------------------------------------------------------------------------
4. PROVIDE ROOFLINE TREATMENT BRICK TOWERS 3.00 25,000.00 75,000,00
-------------------------------------------------------------------------------------------------------------
5. PROVIDE SYNTHETIC STUCCO W/ARCH, END WALLS 3,960.00 10.00 39,600.00
-------------------------------------------------------------------------------------------------------------
0.00
III. PUBLIC AREAS 0.00
0.00
A. LOBBY RESTROOMS 0.00
-------------------------------------------------------------------------------------------------------------
1. REPLACE VINYL WALL COVERING 60.00 18.00 1,080.00
-------------------------------------------------------------------------------------------------------------
2. INSTALL VINYL WALL COVERING INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------
Page 2
------------------------------------------------------------------------------------------------------------------
3. REPLACE VANITIES 2.00 800.00 1,600.00
------------------------------------------------------------------------------------------------------------------
4. SKIRTING (10") COORDINATE WITH VANITIES INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
0.00
B. BANQUET ROOMS - NO.& SQ.FT. 0.00
------------------------------------------------------------------------------------------------------------------
1. REPLACE ENTRY & SERVICE DOORS 1.00 40,000.00 40,000.00
------------------------------------------------------------------------------------------------------------------
2. PROVIDE DOOR VIEWER ENTRY & SERVICE DOORS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
3. PAINT CEILINGS 5,780.00 1.25 7,225.00
------------------------------------------------------------------------------------------------------------------
4. PROVIDE PROPER COMBO OF LIGHTING X RMS 5,780.00 3.50 20,230.00
------------------------------------------------------------------------------------------------------------------
5. PROVIDE LIGHT DIMMER SWITCHES X RM'S 1.00 7,000.00 7,000.00
-----------------------------------------------------------------------------------------------------------------
6. REFINISH PODIUM 5.00 900.00 4,500.00
------------------------------------------------------------------------------------------------------------------
0.00
C. BANQUET ROOMS RESTROOMS 0.00
------------------------------------------------------------------------------------------------------------------
1. REPLACE DOORS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
2. PAINT CEILING INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
3. REPLACE 1X1 FLOOR TILE W/4X4 NEUTRAL COLOR INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
4. COORD. CERAMIC COVE BASE TILE W/FLOOR TILE INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
5. UPGRADE LIGHT FIXTURES INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
6. REPLACE MIRRORS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
7. REPLACE PARTITION WALLS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
8. REPLACE COMMODE SEATS & LIDS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
9. PROVIDE GFI OUTLETS PER STANDARDS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
10. COMPLETELY RENOVATE 2.00 12,000.00 24,000.00
------------------------------------------------------------------------------------------------------------------
0.00
D. RESTAURANT DINING AREA - SQ.FT. 0.00
------------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET & PAD 277.78 30.00 8,333.33
------------------------------------------------------------------------------------------------------------------
2. INSTALL CARPET & PAD INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
3. REPLACE VINYL WALL COVERING 300.00 18.00 5,400.00
------------------------------------------------------------------------------------------------------------------
4. INSTALL VINYL WALL COVERING INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
5. REFINISH WOOD FLOOR 1,000.00 1.25 1,250.00
------------------------------------------------------------------------------------------------------------------
0.00
E. LOUNGE 0.00
------------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET & PAD 325.00 30.00 9,750.00
------------------------------------------------------------------------------------------------------------------
2. INSTALL CARPET & PAD INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
3. REFINISH BAR STOOL FRAMES 75.00 75.00 5,625.00
------------------------------------------------------------------------------------------------------------------
4. REPLACE FABRIC CHAIRS 1.00 2,500.00 2,500.00
------------------------------------------------------------------------------------------------------------------
0.00
F. EXERCISE FACILITY 0.00
------------------------------------------------------------------------------------------------------------------
1. REFINISH DOORS AND FRAMES, ENTRANCE 2.00 65.00 130.00
------------------------------------------------------------------------------------------------------------------
2. PAINT CEILING 500.00 1.00 500.00
------------------------------------------------------------------------------------------------------------------
3. REPLACE CARPET & PAD 60.00 20.00 1,200.00
------------------------------------------------------------------------------------------------------------------
4. INSTALL CARPET & PAD INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------
5. REFINISH HVAC CABINET. 1.00 50.00 50.00
------------------------------------------------------------------------------------------------------------------
6. REPLACE FLOOR TILE AROUND HVAC CABINET 1.00 250.00 250.00
------------------------------------------------------------------------------------------------------------------
0.00
Page 3
G. HOLIDOME AREAS 0.00
-----------------------------------------------------------------------------------------------------------------
1. REPLACE BLACK TILE AT GST ROOM ENTRANCES 1,800.00 10.00 18,000.00
-----------------------------------------------------------------------------------------------------------------
2. COVER PANELS GST RM WINDOWS W/SYN STUCCO 2,400.00 7.00 16,800.00
-----------------------------------------------------------------------------------------------------------------
3. PROVIDE NEW COLOR SCHEME 1.00 25,000.00 25,000.00
-----------------------------------------------------------------------------------------------------------------
0.00
H. KIDS KORNER 0.00
-----------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET & PAD 40.00 20.00 800.00
-----------------------------------------------------------------------------------------------------------------
2. INSTALL CARPET & PAD INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
3. REPLACE 1X1 FLOOR TILE W/4X4 NEUTRAL COLOR 1.00 400.00 400.00
-----------------------------------------------------------------------------------------------------------------
4. REPLACE WORN THRESHOLD 1.00 25.00 25.00
-----------------------------------------------------------------------------------------------------------------
0.00
I. SECOND LEVEL SEATING 0.00
-----------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET & PAD 175.00 30.00 5,250.00
-----------------------------------------------------------------------------------------------------------------
2. INSTALL CARPET & PAD INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
3. REPLACE CHAIRS 40.00 175.00 7,000.00
-----------------------------------------------------------------------------------------------------------------
4. REPLACE TABLES 10.00 150.00 1,500.00
-----------------------------------------------------------------------------------------------------------------
5. REFINISH WALL TREATMENT 1.00 2,500.00 2,500.00
-----------------------------------------------------------------------------------------------------------------
0.00
J. POOL AREA RESTROOMS 0.00
-----------------------------------------------------------------------------------------------------------------
1. REPLACE HAND & KICK PLATES, DOORS 2.00 400.00 800.00
-----------------------------------------------------------------------------------------------------------------
2. REFINISH DOORS INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
3. PAINT CEILINGS 1,200.00 0.50 600.00
-----------------------------------------------------------------------------------------------------------------
4. REPLACE VINYL WALL COVERING 2.00 400.00 800.00
-----------------------------------------------------------------------------------------------------------------
5. INSTALL VINYL WALL COVERING INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
6. REPLACE VANITIES 2.00 900.00 1,800.00
-----------------------------------------------------------------------------------------------------------------
7. COORDINATE SKIRTING W/NEW VANITIES INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
8. REPLACE BASINS 6.00 125.00 750.00
-----------------------------------------------------------------------------------------------------------------
9. REPLACE SINK HARDWARE - TARNISHED 6.00 85.00 510.00
-----------------------------------------------------------------------------------------------------------------
10. REPLACE MIRRORS 2.00 400.00 800.00
-----------------------------------------------------------------------------------------------------------------
11. REPLACE PARTITION WALLS 2.00 3,000.00 6,000.00
-----------------------------------------------------------------------------------------------------------------
12. REPLACE TOILET TISSUE DISPENSERS 8.00 50.00 400.00
-----------------------------------------------------------------------------------------------------------------
13. REPLACE COMMODE SEATS COORD. W/BOWL 6.00 25.00 150.00
-----------------------------------------------------------------------------------------------------------------
0.00
0.00
IV. PRIVATE GUEST AREAS 0.00
0.00
A. GUEST ROOM CORRIDOR 0.00
-----------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET & PAD 2,204.00 30.00 66,120.00
-----------------------------------------------------------------------------------------------------------------
2. INSTALL CARPET & PAD INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
3. REFINISH WOOD CHAIR RAIL & BASEBOARDS 1.00 15,000.00 15,000.00
-----------------------------------------------------------------------------------------------------------------
4. REFINISH STORAGE DOORS 24.00 75.00 1,800.00
-----------------------------------------------------------------------------------------------------------------
0.00
B. GUEST LAUNDRY 0.00
-----------------------------------------------------------------------------------------------------------------
1. PAINT CEILING 1.00 300.00 300.00
-----------------------------------------------------------------------------------------------------------------
Page 4
---------------------------------------------------------------------------------------------------------------------------
2. PAINT PIPES TO BLEND W/CEILING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
C. GUEST ROOMS 0.00
---------------------------------------------------------------------------------------------------------------------------
1. PROVIDE CARPET SWEEPS GST ROOM DOORS 100.00 25.00 2,500.00
---------------------------------------------------------------------------------------------------------------------------
2. UPGRADE INTERIOR SIGNAGE 409.00 100.00 40,900.00
---------------------------------------------------------------------------------------------------------------------------
3. CONNECT DOORS - PAINT DOORS & FRAMES 80.00 35.00 2,800.00
---------------------------------------------------------------------------------------------------------------------------
4. CONNECT DOORS - REPLACE INSULATION 80.00 35.00 2,800.00
---------------------------------------------------------------------------------------------------------------------------
5. REPLACE LIGHT FIXTURES - TARNISHED 250.00 200.00 50,000.00
---------------------------------------------------------------------------------------------------------------------------
6. REPLACE LAMPSHADES - STAINED 50.00 40.00 2,000.00
---------------------------------------------------------------------------------------------------------------------------
7. REFINISH CEILINGS - AS NEEDED 100.00 100.00 10,000.00
---------------------------------------------------------------------------------------------------------------------------
8. REPLACE VWC - DAMAGED 150.00 600.00 90,000.00
---------------------------------------------------------------------------------------------------------------------------
9. INSTALL VWC INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
9. REPLACE CARPET & PAD 409.00 455.00 186,095.00
---------------------------------------------------------------------------------------------------------------------------
10. INSTALL CARPET & PAD INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
12. REPLACE DRAPES 150.00 200.00 30,000.00
---------------------------------------------------------------------------------------------------------------------------
12. REPLACE BEDSPREADS - KING 0.00
---------------------------------------------------------------------------------------------------------------------------
13. REPLACE BEDSPREADS - DOUBLE 350.00 75.00 26,250.00
---------------------------------------------------------------------------------------------------------------------------
14. REPLACE PILLOWS - WORN, STAINED 1,227.00 4.50 5,521.50
---------------------------------------------------------------------------------------------------------------------------
15. FULL LENGTH MIRRORS X EACH ROOM 250.00 45.00 11,250.00
---------------------------------------------------------------------------------------------------------------------------
16. REFINISH CASE GOODS - #1193 150.00 150.00 22,500.00
---------------------------------------------------------------------------------------------------------------------------
17. REFINISH CASE GOODS - #1133 INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
18. REPLACE MATTRESS - KING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
19. REPLACE MATTRESS - DOUBLE 150.00 250.00 37,500.00
---------------------------------------------------------------------------------------------------------------------------
20. ENSURE ALL TV'S WORK W/REMOTE M/R 0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
D. GUESS BATHROOMS 0.00
---------------------------------------------------------------------------------------------------------------------------
1. PAINT ENTRY DOORS & FRAMES 150.00 35.00 5,250.00
---------------------------------------------------------------------------------------------------------------------------
2. REPLACE THRESHOLDS COORD. W/FLOOR TITLE 150.00 25.00 3,750.00
---------------------------------------------------------------------------------------------------------------------------
3. REPLACE 1X1 FLOOR TILE W/4X4, NEUTRAL COLOR 150.00 300.00 45,000.00
---------------------------------------------------------------------------------------------------------------------------
4. REPLACE CARPET & PAD AT VANITY AREA INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
5. INSTALL CARPET & PAD INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
6. REPLACE WALL TILES 150.00 400.00 60,000.00
---------------------------------------------------------------------------------------------------------------------------
6. REPLACE VINYL WALL COVERING 150.00 125.00 18,750.00
---------------------------------------------------------------------------------------------------------------------------
7. INSTALL VINYL WALL COVERING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
8. PAINT CEILING FINISH INCLUDED 35.00 0.00
---------------------------------------------------------------------------------------------------------------------------
9. REPLACE CEILING TILES - DAMAGED 150.00 100.00 15,000.00
---------------------------------------------------------------------------------------------------------------------------
10. REPLACE/UPGRADE VANITY LIGHTING 150.00 200.00 30,000.00
---------------------------------------------------------------------------------------------------------------------------
11. UPGRADE VANITY LIGHTING FIXTURES 150.00 150.00 22,500.00
---------------------------------------------------------------------------------------------------------------------------
12. REPLACE CLOTHES RACKS - RUSTED 150.00 45.00 6,750.00
---------------------------------------------------------------------------------------------------------------------------
13. REPLACE VANITIES 150.00 300.00 45,000.00
---------------------------------------------------------------------------------------------------------------------------
14. VANITY SKIRTS (10") - COORD. W/VANITIES INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
15. REPAIR SINKS - DAMAGED 150.00 85.00 12,750.00
---------------------------------------------------------------------------------------------------------------------------
16. REPLACE VANITY HARDWARE - BRASSY, TARNISHED 150.00 85.00 12,750.00
---------------------------------------------------------------------------------------------------------------------------
17. REPLACE TISSUE DISP. - TARNISHED, SCRATCHED 150.00 85.00 12,750.00
---------------------------------------------------------------------------------------------------------------------------
Page 5
-----------------------------------------------------------------------------------------------------------------
18. REPLACE VANITY MIRRORS-DESILVERED 150.00 90.00 13,500.00
-----------------------------------------------------------------------------------------------------------------
19. PROVIDE MIRRIORS THAT EXTEND WIDTH OF VANTIY INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
20. REFINISH/REPLACE TUBS - DAMAGED 50.00 350.00 17,500.00
-----------------------------------------------------------------------------------------------------------------
21. REPLACE B.TUB HARDWARE-BRASSY, TARNISHED 150.00 85.00 12,750.00
-----------------------------------------------------------------------------------------------------------------
22. REPLACE B.TUB SKID TREATMENT - WORN 150.00 15.00 2,250.00
-----------------------------------------------------------------------------------------------------------------
23. REPLACE B. TUB ENCLOSD WALL TILES - DAMAGED 150.00 400.00 60,000.00
-----------------------------------------------------------------------------------------------------------------
24. REPAIR TUB TILE GROUT-DAMAGED, DISCOLORED INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
25. REPLACE GRAB BARS -TARNISHED, WORN 150.00 25.00 3,750.00
-----------------------------------------------------------------------------------------------------------------
26. REPLACE COMMODES - WORN 25.00 375.00 9,375.00
-----------------------------------------------------------------------------------------------------------------
27. REPLACE COMMODES SEATS/LIDS - WORN 150.00 25.00 3,750.00
-----------------------------------------------------------------------------------------------------------------
0.00
0.00
V. BACK OF THE HOUSE 0.00
0.00
A. EMPLOYEE BREAKROOM 0.00
-----------------------------------------------------------------------------------------------------------------
1. COMPLETE RENOVATION 1.00 5,000.00 5,000.00
-----------------------------------------------------------------------------------------------------------------
0.00
B. EMPLOYEE RESTROOMS 0.00
-----------------------------------------------------------------------------------------------------------------
1. COMPLETE RENOVATION 2.00 5,000.00 10,000.00
-----------------------------------------------------------------------------------------------------------------
C. OPERATIONAL REQUIREMENTS
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
0.00
VI. MECHANICAL - ELECTRICAL 0.00
0.00
A. FIRE SAFETY SYSEM 0.00
-----------------------------------------------------------------------------------------------------------------
1. WRITTEN DOC MUST BE SUBMITTED TO HOLIDAY INN COMPLIES 0.00
-----------------------------------------------------------------------------------------------------------------
CERTIFYING SYSTEM MEETS or EXCEEDS HI STAND. 0.00
-----------------------------------------------------------------------------------------------------------------
0.00
0.00
VII. GENERAL CONDITIONS 0.00
0.00
------------------------------------------------------------------------------------------------------------------
A. GENERAL CONDITIONS 1,705,538.83 0.09 153,498.50
------------------------------------------------------------------------------------------------------------------
B. DEPARTMENT INCENTIVES 1,705,538.83 0.01 12,791.54
------------------------------------------------------------------------------------------------------------------
C. DEPARTMENT OVERHEAD 1,705,538.83 0.01 12,791.54
------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------
Page ▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
SUMMARY
MARCH 26, 1996
--------------------------------------------------------------------------------
EST.COST
--------------------------------------------------------------------------------
I. EXTERIOR 112,500.00
II. BUILDING STRUCTURES 572,075.00
III. PUBLIC AREAS 1,234,625.00
IV. PRIVATE GUEST AREAS 3,226,949.92
V. BACK OF HOUSE 25,650.00
VI. MISCELLANEOUS 203,502.83
VII. NEW CONSTRUCTION 588,000.00
VIII. GENERAL CONDITIONS 536,697.25
--------------------------------------------------------------------------------
TOTAL 6,500,000.00
--------------------------------------------------------------------------------
▇▇ ▇▇▇▇▇ HOTEL
SAN JOSE, CALIFORNIA
PRODUCT IMPROVEMENT PLAN
NUMBER OF ROOMS: 332
------------------------------------------------------------------------------------------------------------------------------------
QUANITY/ UNIT EST.
SCOPE OF WORK ALLOWANCE COST COST
------------------------------------------------------------------------------------------------------------------------------------
I. EXTERIOR
A. SIGNAGE
-------------------------------------------------------------------------------------------------------------
1. REPLACEMENT REQUIRED TO MEET STANDARDS 1.00 60,000.00 60,000.00
-------------------------------------------------------------------------------------------------------------
B. LANDSCAPE
-------------------------------------------------------------------------------------------------------------
1. UPGRADE THROUGHOUT 1.00 25,000.00 25,000.00
-------------------------------------------------------------------------------------------------------------
2. PROVIDE DECORATIVE LIGHTING ELEMENTS 1.00 20,000.00 20,000.00
-------------------------------------------------------------------------------------------------------------
C. PARKING LOTS & DRIVES
-------------------------------------------------------------------------------------------------------------
1. REPAIR/RESURFACE/STRIPE LOT 330.00 100.00 DEFER
-------------------------------------------------------------------------------------------------------------
2. IMPROVE LIGHTING 1.00 20,000.00 DEFER
-------------------------------------------------------------------------------------------------------------
3. REPAIR ANY DAMAGED CURBS OR WALKWAYS 1.00 2,000.00 DEFER
-------------------------------------------------------------------------------------------------------------
4. MINOR REPAIR AND STRIPE ONLY 7,500.00
-------------------------------------------------------------------------------------------------------------
II. BUILDING STRUCTURES
A. CANOPIES
-------------------------------------------------------------------------------------------------------------
1. REMOVE BRASS TRIM AND REFINISH 1,500.00 1.50 2,250.00
-------------------------------------------------------------------------------------------------------------
2. RECLAD COLUMNS 2.00 500.00 1,000.00
-------------------------------------------------------------------------------------------------------------
3. REMOVE BOLLARDS: REPLACE DAMAGED PAVERS UNDER 3,000.00 10.00 30,000.00
-------------------------------------------------------------------------------------------------------------
4. PROVIDE NEW ROOF DETAIL 115.00 175.00 10,000.00
-------------------------------------------------------------------------------------------------------------
5. REMOVE BRASS TREATMENT UNDERNEATH AND REPLACE WITH NEW MATERIAL 1,200.00 5.00 6,000.00
-------------------------------------------------------------------------------------------------------------
6. REPLACE FIXTURES UNDER CANOPY AND ON COLUMNS 1.00 5,500.00 5,500.00
-------------------------------------------------------------------------------------------------------------
7. REMOVE BARREL AWNING CANOPY AT CAR RENTAL ENTRY 1.00 1,500.00 1,500.00
-------------------------------------------------------------------------------------------------------------
8. REWORK ISLAND AT ENTRY W/LANDSCAPE ETC. 1.00 2,500.00 2,500.00
-------------------------------------------------------------------------------------------------------------
B. COMMERICAL BUILDING
-------------------------------------------------------------------------------------------------------------
1. REPAINT IN NEW COLOR SCHEME TO COORDINATE W/TOWER 1.00 75,000.00 75,000.00
-------------------------------------------------------------------------------------------------------------
2. REFINISH TILE AT INTERNATIONAL BALLROOM ENTRY 500.00 1.50 750.00
-------------------------------------------------------------------------------------------------------------
3. REMOVE DISPLAY WINDOWS AND COVER W/STUCCO 2.00 200.00 400.00
-------------------------------------------------------------------------------------------------------------
4. REPLACE WALL SCONCES 3.00 125.00 375.00
-------------------------------------------------------------------------------------------------------------
5. CONCEAL DUMPSTER/COMPACTOR/SERVICE AREA 1.00 2,500.00 2,500.00
-------------------------------------------------------------------------------------------------------------
6. REPAIR DAMAGED WALL ON MAINTENANCE SHOP 250.00 1.00 250.00
-------------------------------------------------------------------------------------------------------------
7. IMPROVE APPEARANCE OF EMPLOYEE ENTRY/SCREEN 1.00 1,500.00 1,500.00
-------------------------------------------------------------------------------------------------------------
8. REPLACE INDOOR/OUTDOOR CARPET AT EMPLOYEE ENTRY 50.00 6.00 300.00
-------------------------------------------------------------------------------------------------------------
9. REFINISH PATIO ON IVORY'S RESTAURANT 500.00 3.50 1,750.00
-------------------------------------------------------------------------------------------------------------
10. ROOF TREATMENT 1.00 50,000.00 50,000.00
-------------------------------------------------------------------------------------------------------------
11. IVORY'S PATIO AWNING 1.00 15,000.00 DEFER
-------------------------------------------------------------------------------------------------------------
C. GUESTROOM BUILDING
-------------------------------------------------------------------------------------------------------------
1. PAINT EXTERIOR OF TOWER 45,000.00 6.00 270,000.00
-------------------------------------------------------------------------------------------------------------
2. MOVE STOREFRONTS OUT ON 7-8 84.00 1,000.00 DELETE
-------------------------------------------------------------------------------------------------------------
3. REPLACE METAL GRILLS W/LOUVERED METAL GRILLS 332.00 200.00 DELETE
-------------------------------------------------------------------------------------------------------------
4. PAINT OR REMOVE RAILINGS 332.00 100.00 WAIVER
-------------------------------------------------------------------------------------------------------------
5. REPLACE TILE UNDER NORTH CANOPY 1.00 3,000.00 3,000.00
-------------------------------------------------------------------------------------------------------------
6. REFINISH UNDERSIDE OF CANOPY 1.00 2,500.00 2,500.00
-------------------------------------------------------------------------------------------------------------
7. PROVIDE PARAPET ROOF TREATMENT 600.00 175.00 105,000.00
-------------------------------------------------------------------------------------------------------------
III. PUBLIC AREAS
A. LOBBY
-------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET AND PAD 350.00 30.00 10,500.00
-------------------------------------------------------------------------------------------------------------
2. REPLACE TILE FROM ENTRY THROUGHOUT LOBBY 4,000.00 10.00 40,000.00
-------------------------------------------------------------------------------------------------------------
3. REPLACE WINDOW TREATMENTS 2.00 750.00 1,500.00
-------------------------------------------------------------------------------------------------------------
4. REPLACE ALL LOBBY FURNITURE 1.00 20,000.00 20,000.00
-------------------------------------------------------------------------------------------------------------
5. REPLACE LIGHTING/CHANDELIERS 1.00 20,000.00 20,000.00
-------------------------------------------------------------------------------------------------------------
6. REPLACE ALL WALLCOVERING 500.00 18.00 9,000.00
-------------------------------------------------------------------------------------------------------------
7. REPLACE CEILING 300.00 2.50 750.00
-------------------------------------------------------------------------------------------------------------
8. RELOCATE GIFT SHOP/ CREATE BELLSTORAGE AND BELLSTAND 1.00 10,000.00 10,000.00
-------------------------------------------------------------------------------------------------------------
9. REWORK ENTRY COMPLETELY 1.00 30,000.00 30,000.00
-------------------------------------------------------------------------------------------------------------
10. REPLACE FRONT DESK 1.00 10,000.00 10,000.00
-------------------------------------------------------------------------------------------------------------
11. REPLACE WALL FINISH BEHIND FRONT DESK 50.00 18.00 900.00
-------------------------------------------------------------------------------------------------------------
12. REMOVE HANGING LIGHTS OVER FRONT DESK AND ADD NEW LIGHTING 1.00 1,500.00 1,500.00
-------------------------------------------------------------------------------------------------------------
13. REPLACE ARTWORK BEHIND DESK 1.00 300.00 300.00
-------------------------------------------------------------------------------------------------------------
14. REPLACE STAIRCASE TO BALLROOM 1.00 25,000.00 25,000.00
-------------------------------------------------------------------------------------------------------------
15. COMPLETE NEW SIGN PACKAGE 1.00 35,000.00 35,000.00
-------------------------------------------------------------------------------------------------------------
16. LOBBY MURAL 1.00 20,000.00 DELETE
-------------------------------------------------------------------------------------------------------------
B. ADMINISTRATIVE AREA
-------------------------------------------------------------------------------------------------------------
1. REPLACE ENTRY DOOR 1.00 650.00 650.00
-------------------------------------------------------------------------------------------------------------
2. CONVERT ADMIN OFFICE TO MEETING SPACE/BUS CENTER 1.00 20,000.00 20,000.00
-------------------------------------------------------------------------------------------------------------
C. PUBLIC RESTROOMS/TOILETS (LOBBY)
--------------------------------------------------------------------------------------------------------------------------
1. GUT AND REDO TO ADA STANDARDS 2.00 15,000.00 30,000.00
--------------------------------------------------------------------------------------------------------------------------
D. FIESTA BALLROOM RESTROOMS 0.00
--------------------------------------------------------------------------------------------------------------------------
1. GUT AND REDO TO ADA STANDARDS 2.00 15,000.00 30,000.00
--------------------------------------------------------------------------------------------------------------------------
E. LOBBY BAR
--------------------------------------------------------------------------------------------------------------------------
1. RECONCEPT/REDO 1.00 100,000.00 100,000.00
--------------------------------------------------------------------------------------------------------------------------
F. RESTAURANT
--------------------------------------------------------------------------------------------------------------------------
1. RECONCEPT/RELOCATE 1.00 200,000.00 200,000.00
--------------------------------------------------------------------------------------------------------------------------
G. MEETING PRE-FUNCTION (INTERNATIONAL)
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE WALLCOVERING 150.00 18.00 2,700.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE FURNISHINGS 1.00 1,500.00 1,500.00
--------------------------------------------------------------------------------------------------------------------------
H. MEETING PRE-FUNCTION (FIESTA BALLROOM)
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET AND PAD 500.00 25.00 12,500.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE VINYL 400.00 18.00 7,200.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE/UPGRADE LIGHTING 1.00 7,500.00 7,500.00
--------------------------------------------------------------------------------------------------------------------------
4. REPLACE DOORS TO BALLROOM 3.00 2,000.00 6,000.00
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE DOORS TO MONTEREY AND CARMEL ROOMS 2.00 650.00 1,300.00
--------------------------------------------------------------------------------------------------------------------------
6. REPLACE CEILING 3,100.00 2.50 7,750.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE FURNISHINGS 1.00 5,000.00 5,000.00
--------------------------------------------------------------------------------------------------------------------------
8. LOWER WATER FOUNTAIN 1.00 500.00 500.00
--------------------------------------------------------------------------------------------------------------------------
9. REPLACE ARTWORK 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
10. REPLACE/RELOCATE PHONE PARTITIONS 1.00 5,500.00 5,500.00
--------------------------------------------------------------------------------------------------------------------------
I. FIESTA BALLROOM
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET AND PAD 1,500.00 25.00 37,500.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE VINYL WALLCOVERING 750.00 19.00 13,500.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE AIRWALL COVER 1,600.00 18.00 28,800.00
--------------------------------------------------------------------------------------------------------------------------
4. REPAIR AIR WALLS 1.00 0.00 0.00
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE AIRWALL PASS THRU DOORS 4.00 500.000 2,000.00
--------------------------------------------------------------------------------------------------------------------------
6. REPLACE SERVICE CORRIDOR DOORS 1.00 8,000.00 8,000.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE WINDOW TREATMENTS 6.00 750.00 4,500.00
--------------------------------------------------------------------------------------------------------------------------
8. REPLACE CHANDELIERS 12.00 2,500.00 30,000.00
--------------------------------------------------------------------------------------------------------------------------
9. REPLACE CEILING 12,000.00 2.50 30,000.00
--------------------------------------------------------------------------------------------------------------------------
10. IMPROVE LIGHTING 1.00 20,000.00 20,000.00
--------------------------------------------------------------------------------------------------------------------------
11. CLEAN UP ROOF TOP VIEW FROM WEST END OF BALLROOM 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
12. REPLACE ALL CHAIRS 1,000.00 40.00 40,000.00
--------------------------------------------------------------------------------------------------------------------------
13. REPLACE TABLES AS NEEDED 50.00 250.00 12,500.00
--------------------------------------------------------------------------------------------------------------------------
14. REPLACE CHAIR RAIL 550.00 5.00 2,750.00
--------------------------------------------------------------------------------------------------------------------------
15. REPLACE ARTWORK 1.00 3,500.00 3,500.00
--------------------------------------------------------------------------------------------------------------------------
16. REPLACE AIRWALLS 1.00 125,000.00 125,000.00
--------------------------------------------------------------------------------------------------------------------------
17. NEW AUDIO VISUAL SYSTEM 1.00 50,000.00 50,000.00
--------------------------------------------------------------------------------------------------------------------------
J. INTERNATIONAL BALLROOM
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET AND PAD 475.00 25.00 11,875.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE WALL COVERING 250.00 18.00 4,500.00
--------------------------------------------------------------------------------------------------------------------------
4. REPLACE WOOD BASE 250.00 5.00 1,250.00
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE ARTWORK 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
6. REPLACE CEILING 3,900.00 2.50 9,750.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE TABLES 20.00 250.00 5,000.00
--------------------------------------------------------------------------------------------------------------------------
8. REPLACE CHAIRS 200.00 40.00 8,000.00
--------------------------------------------------------------------------------------------------------------------------
K. MONTEREY ROOM
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET AND PAD 65.00 25.00 1,625.00
--------------------------------------------------------------------------------------------------------------------------
2. USE VINYL WALLCOVER INSTEAD OF PAINT 100.00 18.00 1,800.00
--------------------------------------------------------------------------------------------------------------------------
3. REFINISH TRIM 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
4. REFINISH/REPLACE CEILING 1,000.00 2.50 2,500.00
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE WINDOW TREATMENT 1.00 750.00 750.00
--------------------------------------------------------------------------------------------------------------------------
6. UPGRADE LIGHTING 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE WOOD BASE 100.00 5.00 500.00
--------------------------------------------------------------------------------------------------------------------------
8. REPLACE TABLES 5.00 250.00 1,250.00
--------------------------------------------------------------------------------------------------------------------------
9. REPLACE CHAIRS 50.00 40.00 2,000.00
--------------------------------------------------------------------------------------------------------------------------
L. CARMEL ROOM
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET AND PAD 65.00 25.00 1,625.00
--------------------------------------------------------------------------------------------------------------------------
2. USE VINYL WALLCOVERING INSTEAD OF PAINT 100.00 18.00 1,800.00
--------------------------------------------------------------------------------------------------------------------------
3. REFINISH TRIM 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
4. REFINISH/REPLACE CEILING 1,000.00 2.50 2,500.00
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE WINDOW TREATMENT 1.00 750.00 750.00
--------------------------------------------------------------------------------------------------------------------------
6. UPGRADE LIGHTING 1.00 1,000.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE WOOD BASE 100.00 5.00 500.00
--------------------------------------------------------------------------------------------------------------------------
8. REPLACE BOARD TABLE 1.00 3,000.00 3,000.00
--------------------------------------------------------------------------------------------------------------------------
9. REPLACE CHAIRS 10.00 350.00 3,500.00
--------------------------------------------------------------------------------------------------------------------------
M. SWIMMING POOL & DECK
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE CHAISES 16.00 200.00 15,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE CHAIRS 40.00 100.00 4,000.00
--------------------------------------------------------------------------------------------------------------------------
3. REPLACE TABLES 4.00 300.00 1,200.00
--------------------------------------------------------------------------------------------------------------------------
4. UPGRADE LANDSCAPE 1.00 7,500.00 7,500.00
--------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------
5. REPLACE TILE AND COPING 1.00 3,500.00 3,500.00
--------------------------------------------------------------------------------------------------------------------------
6. RECESS NO DIVING AND DEPTH MARKERS 20.00 65.00 1,300.00
--------------------------------------------------------------------------------------------------------------------------
7. COMPLETELY REFINISH POOL RESTROOMS 2.00 500.00 1,000.00
--------------------------------------------------------------------------------------------------------------------------
8. REPLACE UMBRELLAS 4.00 400.00 1,600.00
--------------------------------------------------------------------------------------------------------------------------
9. NEW DECK MATERIAL 5,000.00 6.00 DEFER
--------------------------------------------------------------------------------------------------------------------------
N. FITNESS CENTER/EXERCISE ROOM
--------------------------------------------------------------------------------------------------------------------------
1. REFINISH WALLS AND ENCLOSE HVAC 1.00 3,000.00 3,000.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE CARPET 65.00 15.00 975.00
--------------------------------------------------------------------------------------------------------------------------
3. PROVIDE HOUSE PHONE 1.00 250.00 250.00
--------------------------------------------------------------------------------------------------------------------------
4. PROVIDE COLORFUL GRAPHICS & WALL DECOR. 1.00 300.00 300.00
--------------------------------------------------------------------------------------------------------------------------
5. PROVIDE INSTRUCTIONS FOR USE OF EXERCISE EQUIPMENT 1.00 500.00 500.00
--------------------------------------------------------------------------------------------------------------------------
6. REPLACE EXERCISE EQUIPMENT 0.00
--------------------------------------------------------------------------------------------------------------------------
TREADMILL 1.00 3,500.00 3,500.00
--------------------------------------------------------------------------------------------------------------------------
EXERCISE BIKES 2.00 550.00 1,100.00
--------------------------------------------------------------------------------------------------------------------------
CLIMBER 1.00 3,300.00 3,300.00
--------------------------------------------------------------------------------------------------------------------------
TELEVISION 1.00 325.00 325.00
--------------------------------------------------------------------------------------------------------------------------
SCALES 1.00 300.00 300.00
--------------------------------------------------------------------------------------------------------------------------
7. REPLACE EXHAUST FAN 1.00 500.00 500.00
--------------------------------------------------------------------------------------------------------------------------
O. INTERIOR STAIRWELLS
--------------------------------------------------------------------------------------------------------------------------
1. REPLACE DAMAGED HARDWARE 14.00 300.00 4,200.00
--------------------------------------------------------------------------------------------------------------------------
2. REPLACE PUSH & KICK PLATES 14.00 300.00 4,200.00
--------------------------------------------------------------------------------------------------------------------------
P. ELEVATORS
--------------------------------------------------------------------------------------------------------------------------
1. UPGRADE ELEVATOR TO ADA STANDARDS 3.00 15,000.00 45,000.00
--------------------------------------------------------------------------------------------------------------------------
IV. PRIVATE GUEST AREAS
A. INTERIOR GUEST ROOM CORRIDORS
---------------------------------------------------------------------------------------------------------------------------
1. REPLACE CARPET 1,700.00 22.00 37,400.00
---------------------------------------------------------------------------------------------------------------------------
2. REPLACE CARPET PAD AND BASE 1,700.00 4.50 7,650.00
---------------------------------------------------------------------------------------------------------------------------
3. REPLACE WALLCOVERING 3,500.00 18.00 83,000.00
---------------------------------------------------------------------------------------------------------------------------
4. REPLACE CEILING TILES 15,000.00 2.50 37,500.00
---------------------------------------------------------------------------------------------------------------------------
5. REPLACE LIGHTING FIXTURE - WALL 170.00 65.00 11,060.00
---------------------------------------------------------------------------------------------------------------------------
6. REPLACE LIGHTING FIXTURE - CEILING 240.00 100.00 24,000.00
---------------------------------------------------------------------------------------------------------------------------
7. REMOVE MIRRORS FROM ELEVATOR LOBBIES 8.00 750.00 8,000.00
---------------------------------------------------------------------------------------------------------------------------
8. REPLACE DOORS 332.00 325.00 107,900.00
---------------------------------------------------------------------------------------------------------------------------
9. REPLACE ELEVATOR LOBBY FURNISHINGS 7.00 750.00 5,250.00
---------------------------------------------------------------------------------------------------------------------------
B. GUEST ROOM CORRIDOR VENDING
---------------------------------------------------------------------------------------------------------------------------
1. PROVIDE NON-SLIP TILE FLOORING 7.00 400.00 2,800.00
---------------------------------------------------------------------------------------------------------------------------
2. REPLACE WALL SURFACE 80.00 18.00 1,440.00
---------------------------------------------------------------------------------------------------------------------------
3. REPLACE LIGHTING 7.00 100.00 700.00
---------------------------------------------------------------------------------------------------------------------------
4. REPLACE DOORS TO SERVICE ELEVATOR 7.00 300.00 2,100.00
---------------------------------------------------------------------------------------------------------------------------
C. GUESTROOMS
---------------------------------------------------------------------------------------------------------------------------
1. PROVIDE ELECTRONIC LOCKS 332.00 350.00 115,200.00
---------------------------------------------------------------------------------------------------------------------------
2. REPLACE DOOR NUMBERS W/BRAILLE INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
3. REPLACE CONNECTIONS DOORS 160.00 150.00 24,000.00
---------------------------------------------------------------------------------------------------------------------------
4. REPLACE WALL FINISH 332.00 600.00 199,200.00
---------------------------------------------------------------------------------------------------------------------------
5. REPLACE CARPET/PAD/BASE 332.00 650.00 215,800.00
---------------------------------------------------------------------------------------------------------------------------
6. REPLACE LIGHT PACKAGE 332.00 250.00 83,000.00
---------------------------------------------------------------------------------------------------------------------------
7. REPLACE CASEGOODS 332.00 1,200.00 398,400.00
---------------------------------------------------------------------------------------------------------------------------
8. REPLACE ACTIVITY CHAIRS 332.00 125.00 41,500.00
---------------------------------------------------------------------------------------------------------------------------
9. PROVIDE LOUNGE CHAIR & OTTOMAN 100.00 350.00 35,000.00
---------------------------------------------------------------------------------------------------------------------------
10. REPLACE SOFA/SLEEPERS 60.00 575.00 34,500.00
---------------------------------------------------------------------------------------------------------------------------
11. REPLACE ALL TELEVISIONS 332.00 350.00 115,200.00
---------------------------------------------------------------------------------------------------------------------------
12. REPLACE WINDOW TREATMENT 332.00 450.00 149,400.00
---------------------------------------------------------------------------------------------------------------------------
13. REPLACE ARTWORK 332.00 120.00 39,840.00
---------------------------------------------------------------------------------------------------------------------------
14. REPLACE MATTRESSESS - FULL XL 332.00 250.00 83,000.00
---------------------------------------------------------------------------------------------------------------------------
15. REPLACE MATTRESSESS - KING 166.00 300.00 49,800.00
---------------------------------------------------------------------------------------------------------------------------
17. REPLACE BEDSPREADS W/COVERLET AND DUST SKIRT 332.00 125.00 41,500.00
---------------------------------------------------------------------------------------------------------------------------
18. REPLACE BEDSPREADS - KING 166.00 85.00 14,110.00
---------------------------------------------------------------------------------------------------------------------------
19. REPLACE LINEN 1.00 35,000.00 MOVE TO OPS
---------------------------------------------------------------------------------------------------------------------------
20. PROVIDE HANDICAP ACCESSIBLE ROOMS 7.00 5,000.00 35,000.00
---------------------------------------------------------------------------------------------------------------------------
21. REPLACE THRU WALL A/C UNITS 332.00 600.00 199,200.00
---------------------------------------------------------------------------------------------------------------------------
22. PAINT CEILINGS, DOORS, FRAMES, ETC. 332.00 250.00 83,000.00
---------------------------------------------------------------------------------------------------------------------------
23. INSTALL FF/E 332.00 150.00 49,800.00
---------------------------------------------------------------------------------------------------------------------------
24. CONVERT CAR LEASE, BEAUTY SALON AND GUEST LAUNDRY BACK TO ROOMS 4.00 12,000.00 49,800.00
---------------------------------------------------------------------------------------------------------------------------
25. CONVERT CMU ON INTERIOR WALL W/SHEETROCK 332.00 200.00 66,400.00
---------------------------------------------------------------------------------------------------------------------------
26. MINI BARS 360.00 400.00 DEFER
---------------------------------------------------------------------------------------------------------------------------
D. GUEST BATHROOMS
---------------------------------------------------------------------------------------------------------------------------
1. REPLACE VANITIES 332.00 300.00 99,600.00
---------------------------------------------------------------------------------------------------------------------------
2. REPLACE TUB AND SURROUND 332.00 872.56 289,689.92
---------------------------------------------------------------------------------------------------------------------------
3. REPLACE TILE FLOOR 332.00 300.00 99,600.00
---------------------------------------------------------------------------------------------------------------------------
4. REPLACE LIGHTING ABOVE VANITY 332.00 200.00 66,400.00
---------------------------------------------------------------------------------------------------------------------------
5. PROVIDE GFI OUTLET 332.00 45.00 14,940.00
---------------------------------------------------------------------------------------------------------------------------
6. REPLACE VANITY FITTINGS 332.00 65.00 21,580.00
---------------------------------------------------------------------------------------------------------------------------
7. PAINT TRIM 332.00 100.00 33,200.00
---------------------------------------------------------------------------------------------------------------------------
8. REPLACE BATH DOOR 332.00 150.00 49,800.00
---------------------------------------------------------------------------------------------------------------------------
9. REPLACE DAMAGED MIRRORS 100.00 95.00 9,500.00
---------------------------------------------------------------------------------------------------------------------------
10. REPLACE WALLCOVERING 332.00 250.00 83,000.00
---------------------------------------------------------------------------------------------------------------------------
11. CREATE BATHS W/ROLL IN SHOWERS 3.00 10,000.00 30,000.00
---------------------------------------------------------------------------------------------------------------------------
V. BACK OF HOUSE
A. KITCHEN/BANQUET EQUIPMENT
---------------------------------------------------------------------------------------------------------------------------
1. ALLOWANCE FOR REPAIR AND MAINTENANCE 1.00 25,000.00 25,000.00
---------------------------------------------------------------------------------------------------------------------------
2. A/C FOR HOUSEKEEPING 1.00 650.00 650.00
---------------------------------------------------------------------------------------------------------------------------
VI. MISCELLANEOUS
---------------------------------------------------------------------------------------------------------------------------
1. REPLACE ALL UNIFORMS 100.00 300.00 30,000.00
---------------------------------------------------------------------------------------------------------------------------
2. SALES AUTOMATION 1.00 40,000.00 DEFER
---------------------------------------------------------------------------------------------------------------------------
3. GRAND OPENING 1.00 0.00 0.00
---------------------------------------------------------------------------------------------------------------------------
4. REPLACE P.O.S. SYSTEM IN RESTAURANT AND BAR 1.00 25,000.00 DEFER
---------------------------------------------------------------------------------------------------------------------------
5. AUDIO VISUAL EQUIPMENT 1.00 20,002.83 20,002.83
---------------------------------------------------------------------------------------------------------------------------
6. VANS 2.00 28,000.00 56,000.00
---------------------------------------------------------------------------------------------------------------------------
7. REPAIR ANNUNCIATOR PANEL 1.00 65,000.00 65,000.00
---------------------------------------------------------------------------------------------------------------------------
8. REPAIR/REPLACE COMMERCIAL ROOFTOP UNITS 5.00 6,500.00 32,500.00
---------------------------------------------------------------------------------------------------------------------------
9. ALLOWANCE FOR ROOF REPAIRS 1.00 50,000.00 DEFER
---------------------------------------------------------------------------------------------------------------------------
10. SEPARATE DATA AND PHONE LINES/NEW SWITCH 1.00 200,000.00 DEFER
---------------------------------------------------------------------------------------------------------------------------
VII. NEW CONSTRUCTION
---------------------------------------------------------------------------------------------------------------------------
1. CONVERT 9TH FLOOR TO CONCIERGE FLOOR W/LOUNGE 28.00 21,000.00 588,000.00
---------------------------------------------------------------------------------------------------------------------------
VIII. GENERAL CONDITIONS
-------------------------------------------------------------------------------------------------------------------------------
A. GENERAL CONDITIONS 5,963,302.75 0.09 535,697.25
-------------------------------------------------------------------------------------------------------------------------------
B. DEPARTMENT INCENTIVES 5,963,302.75 0.0075 44,724.77
-------------------------------------------------------------------------------------------------------------------------------
C. DEPARTMENT OVERHEAD 5,963,302.75 0.0075 44,724.77
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
TOTAL: 6,500,000.00
-------------------------------------------------------------------------------------------------------------------------------
DOUBLETREE HOTEL
MISSION VALLEY, CA
SUMMARY
PRODUCT IMPROVEMENT PLAN
--------------------------------------------------------------------------------
AREAS EST.COST
--------------------------------------------------------------------------------
I. LIFE SAFETY 15,000.00
II. LOBBY/ENTRANCE/FRONT DESK 110,255.00
III. PUBLIC RESTROOMS 26,300.00
IV. FOOD SERVICE FACILITIES 75,035.00
V. LOUNGE FACILITIES 75,000.00
VI. MEETING ROOMS (RENOVATE EXISTING ONLY) 153,125.00
VII. PUBLIC AREAS 1,453.00
VIII. INTERIOR CORRIDORS 190,536.50
IX. GUEST ROOMS 824,090.00
X. GUEST BATH ROOMS 98,870.00
XI. EXTERIOR 534,100.00
XII. BACK OF THE HOUSE 163,000.00
XIII. GENERAL CONDITIONS 238,010.27
--------------------------------------------------------------------------------
TOTAL 2,504,774.77
--------------------------------------------------------------------------------
Page ▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
PRODUCT IMPROVEMENT PLAN
---------------------------------------------------------------------------------------------------------------
QUANITY/ UNIT EST.
AREAS SCOPE OF WORK ALLOWANCE COST COST
---------------------------------------------------------------------------------------------------------------
I. LIFE SAFETY
A. FIRE SAFETY SYSTEM
---------------------------------------------------------------------------------------------------
1 MUST COMPLY WITH DOUBLETREE STANDARDS 1.00 15,000.00 15,000.00
---------------------------------------------------------------------------------------------------
0.00
II. LOBBY/ENTRANCE/FRONT DESK 0.00
0.00
A. LOBBY 0.00
---------------------------------------------------------------------------------------------------
1 REPLACE CARPET 16.00 30.00 480.00
---------------------------------------------------------------------------------------------------
2 REPLACE PLANTER POTS 16.00 250.00 4,000.00
---------------------------------------------------------------------------------------------------
3 REPLACE FURNITURE 1.00 7,000.00 15,000.00
---------------------------------------------------------------------------------------------------
4 MISC. PAINT 1.00 1,500.00 1,500.00
---------------------------------------------------------------------------------------------------
5 LIGHTING-ADD CHANDELIERS 1.00 10,000.00 10,000.00
---------------------------------------------------------------------------------------------------
6 AREA RUGS 1.00 5,000.00 5,000.00
---------------------------------------------------------------------------------------------------
7 MISC. DOUBLETREE UPGRADES 1.00 50,000.00 50,000.00
---------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------
B. FRONT DESK
---------------------------------------------------------------------------------------------------
1 OWNER/OPERATOR SIGN 1.00 75.00 75.00
---------------------------------------------------------------------------------------------------
2 REPLACE/UPGRADE 1.00 15,000.00 20,000.00
---------------------------------------------------------------------------------------------------
0.00
C. HALLWAYS 0.00
---------------------------------------------------------------------------------------------------
1. UPGRADE 600.00 7.00 4,200.00
---------------------------------------------------------------------------------------------------
0.00
III. PUBLIC RESTROOMS 0.00
0.00
A. LOBBY AREA 0.00
---------------------------------------------------------------------------------------------------
1 MODIFY VANITIES FOR ADA 2.00 150.00 300.00
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
B. POOL AREA - OUTSIDE
---------------------------------------------------------------------------------------------------
1 RENOVATE 2.00 10,000.00 20,000.00
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
C. POOL AREA - INSIDE
---------------------------------------------------------------------------------------------------
1 MINOR REPAIRS 2.00 3,000.00 6,000.00
---------------------------------------------------------------------------------------------------
Page 2
--------------------------------------------------------------------------------------------
2
--------------------------------------------------------------------------------------------
0.00
IV. FOOD SERVICE FACILITIES 0.00
0.00
A. RESTAURANT 0.00
--------------------------------------------------------------------------------------------
1 REPLACE CARPET 217.00 30.00 6,510.00
--------------------------------------------------------------------------------------------
2 UPGRADE BUFFET 1.00 3,500.00 3,500.00
--------------------------------------------------------------------------------------------
3 OWNER/OPERATOR SIGN 1.00 75.00 75.00
--------------------------------------------------------------------------------------------
4 REFINISH CHAIRS 66.00 75.00 4,950.00
--------------------------------------------------------------------------------------------
5 ACCESSORIES 1.00 0.00
--------------------------------------------------------------------------------------------
6 INCREASE LIGHTING 1.00 5,000.00 5,000.00
--------------------------------------------------------------------------------------------
7 MISC. TO DOUBLETREE STANARDS 1.00 55,000.00 55,000.00
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
0.00
V. LOUNGE FACILITIES 0.00
0.00
A. LOUNGE 0.00
--------------------------------------------------------------------------------------------
1 NEW CONCEPT 1.00 75,000.00 75,000.00
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
VI. MEETING ROOMS 0.00
0.00
A. PRE-FUNCTION 0.00
--------------------------------------------------------------------------------------------
1 COMPLETELY RENOVATE 704.00 25.00 17,600.00
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
0.00
B. MEETING ROOM - VALLEY 0.00
--------------------------------------------------------------------------------------------
1 COMPLETELY RENOVATE 2,146.00 25.00 53,650.00
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
C. MEETING ROOM - CABANA 0.00
--------------------------------------------------------------------------------------------
1 COMPLETELY RENOVATE 2,075.00 25.00 51,875.00
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
D. MEETING ROOMS - 214, 210, 200, 1000
--------------------------------------------------------------------------------------------
1 COMPLETELY RENOVATE 2,000.00 15.00 30,000.00
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
VII. PUBLIC AREAS 0.00
0.00
Page 3
A. EXERCISE ROOM 0.00
-----------------------------------------------------------------------------------------------------------
1 ADD CLOCK 1.00 45.00 45.00
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
B. GUEST LAUNDRY
-----------------------------------------------------------------------------------------------------------
1 UPGRADE AREA 176.00 8.00 1,408.00
-----------------------------------------------------------------------------------------------------------
VIII. INTERIOR CORRIDORS 0.00
0.00
A. CORRIDORS - 10 STORY TOWER 0.00
-----------------------------------------------------------------------------------------------------------
1 NEW GRAPHICS PACKAGE 212.00 125.00 26,500.00
-----------------------------------------------------------------------------------------------------------
2 REPLACE CARPET 1,200.00 30.00 36,000.00
-----------------------------------------------------------------------------------------------------------
3 REPLACE VWC 2,200.00 18.00 39,600.00
-----------------------------------------------------------------------------------------------------------
4 PAINT DOORS/FRAMES 212.00 35.00 7,420.00
-----------------------------------------------------------------------------------------------------------
5 REPLACE WALL SCOUNCES 130.00 150.00 19,500.00
-----------------------------------------------------------------------------------------------------------
6 REFINISH ELEVATOR DOORS 20.00 200.00 4,000.00
-----------------------------------------------------------------------------------------------------------
7 PAINT CEILING 9,833.00 0.50 4,916.50
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
0.00
-----------------------------------------------------------------------------------------------------------
B. ELEVATORS
-----------------------------------------------------------------------------------------------------------
1 UPGRADE 4.00 8,000.00 32,000.00
-----------------------------------------------------------------------------------------------------------
C. VENDING
-----------------------------------------------------------------------------------------------------------
1 CLEAN/REPAIR FLOOR TILE 800.00 7.00 5,600.00
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
D. STAIRWELLS
-----------------------------------------------------------------------------------------------------------
1 PAINT RAILINGS/WALLS/FLOORS 1.00 15,000.00 15,000.00
-----------------------------------------------------------------------------------------------------------
0.00
IX. GUEST ROOMS 0.00
0.00
A. GUEST ROOMS - 10 STORY TOWER 0.00
-----------------------------------------------------------------------------------------------------------
1 REPLACE CARPET 212.00 520.00 110,240.00
-----------------------------------------------------------------------------------------------------------
2 CARPET BASE 212.00 105.00 22,260.00
-----------------------------------------------------------------------------------------------------------
3 REPLACE CASEGOODS 212.00 1,500.00 318,000.00
-----------------------------------------------------------------------------------------------------------
4 REPLACE ARTWORK 212.00 120.00 25,440.00
-----------------------------------------------------------------------------------------------------------
5 REPLACE LIGHTING PACKAGE 212.00 250.00 53,000.00
-----------------------------------------------------------------------------------------------------------
6 REPLACE ENTRY FOYER LIGHTS 212.00 100.00 21,200.00
-----------------------------------------------------------------------------------------------------------
7 REPLACE SAGGING MATTRESSES 100.00 300.00 30,000.00
-----------------------------------------------------------------------------------------------------------
8 REPLACE NON - COMPLIANCE TV'S 30.00 275.00 8,250,00
-----------------------------------------------------------------------------------------------------------
9 SOUND STRIP ENTRANCE DOORS - ALL 316.00 30.00 9,480.00
-----------------------------------------------------------------------------------------------------------
Page 4
-------------------------------------------------------------------------------------------------------------
10 FULL LENGTH MIRRORS 316.00 45.00 14,220.00
---------------------------------------------------------------------------------------------------------------
11 REPAIR WALLS UNDER WINDOWS 212.00 150.00 31,800.00
---------------------------------------------------------------------------------------------------------------
12 MISC. 212.00 200.00 42,400.00
---------------------------------------------------------------------------------------------------------------
13 REPLACE BEDSPREADS 424.00 75.00 31,800.00
---------------------------------------------------------------------------------------------------------------
14 REPLACE DRAPERY 212.00 500.00 105,000.00
---------------------------------------------------------------------------------------------------------------
15
---------------------------------------------------------------------------------------------------------------
16
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
0.00
X GUEST BATH ROOMS 0.00
0.00
A. GUEST BATH ROOMS 0.00
---------------------------------------------------------------------------------------------------------------
1 REPLACE DESILVERED MIRRORS 100.00 85.00 8,500.00
---------------------------------------------------------------------------------------------------------------
2 REPLACE VANITY LIGHTS 212.00 125.00 26,500.00
---------------------------------------------------------------------------------------------------------------
3 PAINT DOORS/FRAMES 212.00 35.00 7,420.00
---------------------------------------------------------------------------------------------------------------
4 REPAIR GROUT AT TUBS 212.00 75.00 15,900.00
---------------------------------------------------------------------------------------------------------------
5 REPLACE DAMAGED VANITIES 25.00 350.00 8,750.00
---------------------------------------------------------------------------------------------------------------
6 MISC. 212.00 150.00 31,800.00
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
0.00
XI. EXTERIOR 0.00
0.00
A. CANOPY 0.00
---------------------------------------------------------------------------------------------------------------
1 UPGRADE PORTE COCHERE STRUCTURE 1.00 50,000.00 50,000.00
---------------------------------------------------------------------------------------------------------------
2 CLEAN SURFACES TO ACCEPTABLE CONDITION 1.00 10,000.00 10,000.00
---------------------------------------------------------------------------------------------------------------
3 CONCEAL DUMPSTER WITH SOLID FENCE 1.00 2,500.00 2,500.00
---------------------------------------------------------------------------------------------------------------
4 FINISH SURROUNDS AT CHILLERS 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------------
5 NEW WALKWAY AND STEPS 10,000.00 0.00
---------------------------------------------------------------------------------------------------------------
0.00
B. BUILDING STRUCTURES
---------------------------------------------------------------------------------------------------------------
1 SCREEN EQUIPMENT ON ROOF - COMM, BLDG. 1.00 20,000.00 20,000.00
---------------------------------------------------------------------------------------------------------------
2 SCREEN EQUIPMENT - GROUND LEVEL 1.00 4,000.00 4,000.00
---------------------------------------------------------------------------------------------------------------
3 PAINT ALL BUILDING ENTERIORS 1.00 120,000.00 120,000.00
---------------------------------------------------------------------------------------------------------------
4 REPLACE BALCONY RAILING 3,744.00 25.00 93,600.00
---------------------------------------------------------------------------------------------------------------
5 ROOF LINE DETAIL 0.00 125.00 0.00
---------------------------------------------------------------------------------------------------------------
6 ARCHITECTURAL ROOF ELEMENTS 75,000.00 0.00
---------------------------------------------------------------------------------------------------------------
7 COVER EXPOSED BLOCK WALLS 20,000.00 0.00
---------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------
0.00
B. PARKING LOT 0.00
---------------------------------------------------------------------------------------------------------------
1 REPAIR SUBGRADE/RESURFACE/STRIPE 1.00 78,000.00 78,000.00
---------------------------------------------------------------------------------------------------------------
2 REPLACE BROKEN CURBS INCLUDED
---------------------------------------------------------------------------------------------------------------
Page 5
C. SIGNAGE
---------------------------------------------------------------------------------------------------------------
1 PROVIDE NEW DOUBLETREE SIGNAGE 1.00 75,000.00 75,000.00
---------------------------------------------------------------------------------------------------------------
2
---------------------------------------------------------------------------------------------------------------
D. LANDSCAPING
---------------------------------------------------------------------------------------------------------------
1 UPGRADE REQUIRED 1.00 40,000.00 40,000.00
---------------------------------------------------------------------------------------------------------------
2 0.00
---------------------------------------------------------------------------------------------------------------
0.00
E. EXTERIOR SWIMMING POOL AREA 0.00
---------------------------------------------------------------------------------------------------------------
1 REFINISH POOL DECK 2,500.00 4.00 10,000.00
---------------------------------------------------------------------------------------------------------------
2 REFINISH POOL & SPA 1.00 16,000.00 16,000.00
---------------------------------------------------------------------------------------------------------------
3 NEW PERIMETER TILE 1.00 2,000.00 2,000.00
---------------------------------------------------------------------------------------------------------------
4 REINSTATE WATER FEATURE 1.00 2,500.00 2,500.00
---------------------------------------------------------------------------------------------------------------
▇ ▇▇▇▇▇▇▇ ▇▇▇▇ 1.00 10,000.00 10,000.00
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
XII. BACK OF THE HOUSE 0.00
A. LAUNDRY
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
B. KITCHEN 0.00
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
C. OPERATIONAL REQUIREMENTS
---------------------------------------------------------------------------------------------------------------
1 LINEN/TEXTILES 1.00 18,000.00 18,000.00
---------------------------------------------------------------------------------------------------------------
2 UNIFORMS 1.00 15,000.00 15,000.00
---------------------------------------------------------------------------------------------------------------
3 F & B SUPPLIES 1.00 20,000.00 20,000.00
---------------------------------------------------------------------------------------------------------------
4 A/V EQUIPMENT 1.00 10,000.00 10,000.00
---------------------------------------------------------------------------------------------------------------
5 DOUBLETREE CONVERSION ITEMS, SUPPLIES, PRINTED 1.00 50,000.00 50,000.00
---------------------------------------------------------------------------------------------------------------
6 DOUBLETREE RESERVATION EQUIPMENT 1.00 50,000.00 50,000.00
---------------------------------------------------------------------------------------------------------------
7 NEW TELEPHONE SWITCH 0.00 200,000.00 0.00
---------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------
D. ENGINEERING/ENVIRONMENTAL
---------------------------------------------------------------------------------------------------------------
1
---------------------------------------------------------------------------------------------------------------
2
---------------------------------------------------------------------------------------------------------------
3
---------------------------------------------------------------------------------------------------------------
4
---------------------------------------------------------------------------------------------------------------
Page 6
XIII. GENERAL CONDITIONS 0.00
0.00
A. ALLOWANCE 0.00
------------------------------------------------------------------------------------------------
1 GENERAL CONDITIONS 2,266,764.50 0.09 204,008.81
------------------------------------------------------------------------------------------------
2 DEPARTMENT INCENTIVES 2,266,764.50 0.01 17,000.73
------------------------------------------------------------------------------------------------
3 DEPARTMENT OVERHEAD 2,266,764.50 0.01 17,000.73
------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
TOTAL 2,504,774.77
---------------------------------------------------------------------------------------------------------
Page 7
DAYS INN
OCEAN CITY, MD
SUMMARY
PRODUCT IMPROVEMENT PLAN - HAMPTON INN
--------------------------------------------------------------------------------
AREAS EST.COST
--------------------------------------------------------------------------------
1. EXTERIOR 424,918.00
II. LOBBY/ENTRANCE/FRONT DESK 237,100.00
III. PRIVATE GUEST AREAS 1,054,157.00
IV. BACK OF THE HOUSE 25,545.00
V. MISCELLANEOUS 38,950.00
VI. GENERAL CONDITIONS 124,646.90
--------------------------------------------------------------------------------
TOTAL 1,905,316.90
--------------------------------------------------------------------------------
Page 1
DAYS INN
OCEAN CITY, MD
PRODUCT IMPROVEMEMT PLAN - HAMPTON INN
------------------------------------------------------------------------------------------------------------------------------------
QUANTITY/ UNIT EST.
AREAS SCOPE OF WORK ALLOWANCE COST COST
------------------------------------------------------------------------------------------------------------------------------------
I. EXTERIOR
A. GENERAL SITE ITEMS
---------------------------------------------------------------------------------------------------------------------------
1 ONE PARK PER 8 ADDITIONAL ROOMS WAIVER 0.00
---------------------------------------------------------------------------------------------------------------------------
2 PROVIDE LIGHTING FOR CITY OVERFLOW LOT 1.00 8,000.00 8,000.00
---------------------------------------------------------------------------------------------------------------------------
2 CLEAN CANOPY PAVING 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------------------------
3 ADDITIONAL BUMPERS AT HC PARKING 6.00 25.00 150.00
---------------------------------------------------------------------------------------------------------------------------
4 PAINT LIGHT POLES AND BASES 1.00 3,000.00 3,000.00
---------------------------------------------------------------------------------------------------------------------------
5 PROVIDE ONE FC LIGHTING 1.00 18,000.00 18,000.00
---------------------------------------------------------------------------------------------------------------------------
6 PROVIDE 40 FT FLAGPOLE WITH LIGHTING 1.00 3,500.00 3,500.00
---------------------------------------------------------------------------------------------------------------------------
7 PROVIDE ADDITIONAL PERIMETER LANDSCAPING 1.00 15,000.00 15,000.00
---------------------------------------------------------------------------------------------------------------------------
8 PROVIDE ADDITIONAL PARKING LOT LANDSCAPING 1.00 15,000.00 15,000.00
---------------------------------------------------------------------------------------------------------------------------
9 CORRECT WATER PONDING PROBLEM 1.00 3,000.00 3,000.00
---------------------------------------------------------------------------------------------------------------------------
10 PROVIDE IRRIGATION SYSTEM WAIVER 18,000.00 0.00
---------------------------------------------------------------------------------------------------------------------------
11 PROVIDE DUMPSTER ENCLOSURE 1.00 3,500.00 3,500.00
---------------------------------------------------------------------------------------------------------------------------
12 PROVIDE PRIMARY SIGN ACCORDING TO HAMPTON INN 1.00 15,000.00 15,000.00
---------------------------------------------------------------------------------------------------------------------------
13 PROVIDE SCRIPT SIGNS TO HAMPTON INN 2.00 12,000.00 24,000.00
---------------------------------------------------------------------------------------------------------------------------
14 PROVIDE OFF-SITE SIGNS TO HAMPTON INN 1.00 8,000.00 8,000.00
---------------------------------------------------------------------------------------------------------------------------
15 SCREEN ROOF MOUNTED HVAC-AT REAR ABOVE DECK 1.00 6,000.00 6,000.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
B. CANOPY 0.00
---------------------------------------------------------------------------------------------------------------------------
1 PROVIDE CANOPY PER HAMPTON INN 1.00 25,000.00 25,000.00
---------------------------------------------------------------------------------------------------------------------------
2 REFINISH CANOPY PAVING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
3 REPLACE LIGHT FIXTURES, SPRINKLER HEADS, ETC. 1.00 3,000.00 3,000.00
---------------------------------------------------------------------------------------------------------------------------
4 REFINISH CANOPY EXTERIOR INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
5 REFINISH PARAPET MANSARD ROOF INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
6 REPAIR MOISTURE PROBLEM CAUSING DAMAGE 1.00 5,000.00 5,000.00
---------------------------------------------------------------------------------------------------------------------------
7 PROVIDE 12'-6" CLEARANCE WAIVER 0.00
---------------------------------------------------------------------------------------------------------------------------
8 PROVIDE NEW TRASH/ASH URNS 1.00 1,500.00 1,500.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
C. EXTERIOR WALL FINISH 0.00
---------------------------------------------------------------------------------------------------------------------------
1 PROVIDE MANSARD ROOF PER HIS WAIVER 200.00 0.00
---------------------------------------------------------------------------------------------------------------------------
Page 2
---------------------------------------------------------------------------------------------------------------------------
2 REFINISH CAULK JOINTS INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
3 REFINISH ENTRY DOORS/FRAMES 162.00 75.00 12,150.00
---------------------------------------------------------------------------------------------------------------------------
4 REFINISH EXIT DOORS 14.00 75.00 1,050.00
---------------------------------------------------------------------------------------------------------------------------
5 PROVIDE EXIT DOOR HARDWARE AT POOL AREA 1.00 450.00 450.00
---------------------------------------------------------------------------------------------------------------------------
6 PROVIDE EXIT DOOR LIGHTING 1.00 250.00 250.00
---------------------------------------------------------------------------------------------------------------------------
7 ELIMINATE TRIP HAZARD AT SLIDING GLASS DOORS 162.00 50.00 8,100.00
---------------------------------------------------------------------------------------------------------------------------
8 REPLACE EXISTING HVAC LOUVERS TO MATCH RAILINGS 162.00 100.00 16,200.00
---------------------------------------------------------------------------------------------------------------------------
9 TOTALLY RECAULK AND RECOAT EIFS SYSTEM 162.00 500.00 81,000.00
---------------------------------------------------------------------------------------------------------------------------
10 INSTALL 6" CAP ON BALCONY RAILINGS 2,448.00 20.00 48,960.00
---------------------------------------------------------------------------------------------------------------------------
11 REFINISH STOREFRONTS WINDOWS AT LOBBY 1.00 1,200.00 1,200.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
D. EXTERIOR WALKWAYS 0.00
---------------------------------------------------------------------------------------------------------------------------
1 PROVIDE EMERGENCY LIGHTING 12.00 350.00 4,200.00
---------------------------------------------------------------------------------------------------------------------------
2 PROVIDE FIRE ALARM HORNS 12.00 300.00 3,600.00
---------------------------------------------------------------------------------------------------------------------------
3 REFINISH ANY WORN BALCONY RAILINGS 2,443.00 6.00 14,658.00
---------------------------------------------------------------------------------------------------------------------------
4 REPLACE BALCONY LIGHTING 162.00 125.00 20,250.00
---------------------------------------------------------------------------------------------------------------------------
5 REFINISH HVAC CONDENSING UNIT CABINETS 1.00 250.00 250.00
---------------------------------------------------------------------------------------------------------------------------
6 REPAIR CAULKING AT BUILDING LINE INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
E. INDOOR SWIMMING POOL 0.00
---------------------------------------------------------------------------------------------------------------------------
1 NEW POOL FURNITURE AND UMBRELLAS 1.00 5,000.00 5,000.00
---------------------------------------------------------------------------------------------------------------------------
2 REFINISH CEILING-ADD ACOUST.TILE/BANNERS 3,500.00 2.00 7,000.00
---------------------------------------------------------------------------------------------------------------------------
3 PROVIDE ACOUSTICAL ENVIRONMENT 1.00 3,500.00 3,500.00
---------------------------------------------------------------------------------------------------------------------------
4 REPLACE HVAC/DEHUMIDIFICATION SYSTEM 1.00 25,000.00 25,000.00
---------------------------------------------------------------------------------------------------------------------------
5 ENSURE POOL HEATER IS WORKING M/R 0.00
---------------------------------------------------------------------------------------------------------------------------
6 PROVIDE PANIC HARDWARE AT EXIT DOORS 2.00 450.00 900.00
---------------------------------------------------------------------------------------------------------------------------
7 PROVIDE EXIT SIGNS WITH RESERVE POWER 2.00 600.00 1,200.00
---------------------------------------------------------------------------------------------------------------------------
8 PROVIDE ADDITIONAL EMERGENCY LIGHTING 2.00 250.00 500.00
---------------------------------------------------------------------------------------------------------------------------
9 ENSURE GLASS CLOSURE IS WATERTIGHT 1.00 5,000.00 5,000.00
---------------------------------------------------------------------------------------------------------------------------
10 PROVIDE CERAMIC OR TERRA COTTA POTS 8.00 250.00 2,000.00
---------------------------------------------------------------------------------------------------------------------------
11 REPAINT WALL AT WATER FOUNTAIN 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------------------------
12 ENSURE FOUNTAIN WORKS M/R 0.00
---------------------------------------------------------------------------------------------------------------------------
13 REFINISH ENTIRE EIFS SURFACES 1.00 2,000.00 2,000.00
---------------------------------------------------------------------------------------------------------------------------
14 PROVIDE ▇▇▇▇▇ LIFT FOR ADA 1.00 2,500.00 2,500.00
---------------------------------------------------------------------------------------------------------------------------
15 CONFIRM VAPOR BARRIER BETWEEN POOL AND OTHER WAIVER-VERIFY IF EXIST 0.00
---------------------------------------------------------------------------------------------------------------------------
16 REPLACE RUSTED PIPE AT POOL HEATER 1.00 350.00 350.00
---------------------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------------------
0.00
0.00
II. LOBBY/ENTRANCE/FRONT DESK 0.00
Page 3
0.00
A. LOBBY/BREAKFAST AREA 0.00
----------------------------------------------------------------------------------------------
1 REPLACE ACOUSTICAL TILE 2,500.00 3.00 7,500.00
----------------------------------------------------------------------------------------------
2 PROVIDE ELECTRICAL OIUTLETS 1.00 750.00 750.00
----------------------------------------------------------------------------------------------
3 PROVIDE OUTLETS IN BREAKFAST AREA 1.00 500.00 500.00
----------------------------------------------------------------------------------------------
4 PROVIDE HOUSE PHONE 1.00 350.00 350.00
----------------------------------------------------------------------------------------------
5 PROVIDE ▇▇ ▇▇▇▇▇ FOUNTAIN 1.00 900.00 900.00
----------------------------------------------------------------------------------------------
6 CLEAN FURNITURE, TABLES LAMPS, CHAIRS TO NEW 1.00 10,000.00 10,000.00
----------------------------------------------------------------------------------------------
7 PROVIDE ADDITIONAL LANDSCAPING 1.00 1,500.00 1,500.00
----------------------------------------------------------------------------------------------
8 CLEAN FLOOR TO NEW CONDITION 1.00 800.00 800.00
----------------------------------------------------------------------------------------------
9 MOVE VENDING FROM ENTRY VESTIBULE M/R 0.00
----------------------------------------------------------------------------------------------
10 PROVIDE BRASS STAND AND 100% GUARANTEE 1.00 125.00 125.00
----------------------------------------------------------------------------------------------
11 CLEAN CARPET TO NEW CONDITION 1.00 200.00 200.00
----------------------------------------------------------------------------------------------
12 INSTALL WOOD BASE IN LOUNGE AREA 200.00 6.00 1,200.00
----------------------------------------------------------------------------------------------
13 CONFIRM ALL FOAM AND UPHOLSTERED GOODS MEET HIS M/R 0.00
----------------------------------------------------------------------------------------------
14 SEATING TO BE IN NEW CONDITION M/R 0.00
----------------------------------------------------------------------------------------------
0.00
----------------------------------------------------------------------------------------------
0.00
----------------------------------------------------------------------------------------------
0.00
B. REGISTRATION DESK AREA 0.00
----------------------------------------------------------------------------------------------
1 REPLACE ALL ACOUSTICAL TILE 300.00 3.00 900.00
----------------------------------------------------------------------------------------------
2 REFINISH WALLS-REMOVE SHELF BACK WALL 200.00 18.00 3,600.00
----------------------------------------------------------------------------------------------
3 PROVIDE ELECT/CABINETRY FOR HMS 1.00 5,000.00 5,000.00
----------------------------------------------------------------------------------------------
4 PROVIDE FAN IN DESK FOR HEAT 1.00 125.00 125.00
----------------------------------------------------------------------------------------------
5 PROVIDE OPERATOR SIGNAGE 1.00 75.00 75.00
----------------------------------------------------------------------------------------------
6 SAFE DEPOSIT BOXES-ONE PER 10 GUESTROOMS 1.00 750.00 750.00
----------------------------------------------------------------------------------------------
7 REPLACE CARPET AND PAD 20.00 20.00 400.00
----------------------------------------------------------------------------------------------
8 REMOVE ART FROM BACK WALL ADD SCRIPT SIGN 1.00 500.00 500.00
----------------------------------------------------------------------------------------------
0.00
----------------------------------------------------------------------------------------------
0.00
----------------------------------------------------------------------------------------------
0.00
C. COMPUTER ROOM 0.00
----------------------------------------------------------------------------------------------
CONVERT SALES TO PBX ROOM 0.00
----------------------------------------------------------------------------------------------
1 PROVIDE ELECTRICAL OUTLETS 1.00 500.00 500.00
----------------------------------------------------------------------------------------------
2 PROVIDE PANEL FOR HMS CIRCUITS 1.00 1,200.00 1,200.00
----------------------------------------------------------------------------------------------
3 PROVIDE LIGHTING 1.00 150.00 150.00
----------------------------------------------------------------------------------------------
4 PROVIDE CEILING FINISH 1.00 75.00 75.00
----------------------------------------------------------------------------------------------
5 PROVIDE WALL FINISH 1.00 100.00 100.00
----------------------------------------------------------------------------------------------
6 PROVIDE FLOOR FINISH 1.00 250.00 250.00
----------------------------------------------------------------------------------------------
7 PROVIDE BASE 1.00 80.00 80.00
----------------------------------------------------------------------------------------------
8 PROVIDE SHELVING 1.00 250.00 250.00
----------------------------------------------------------------------------------------------
9 PROVIDE DOOR AND FRAME 1.00 250.00 250.00
----------------------------------------------------------------------------------------------
10 PROVIDE DOOR HARDWARE 1.00 85.00 85.00
----------------------------------------------------------------------------------------------
11 PROVIDE HVAC 1.00 600.00 600.00
----------------------------------------------------------------------------------------------
Page 4
---------------------------------------------------------------------------------------------------------
12 PROVIDE J-BOX FOR HMS 1.00 250.00 250.00
---------------------------------------------------------------------------------------------------------
13 PROVIDE TELEPHONE ▇▇▇▇ 1.00 75.00 75.00
---------------------------------------------------------------------------------------------------------
0.00
D. PBX/TELEPHONE 0.00
---------------------------------------------------------------------------------------------------------
1 PROVIDE PLYWOOD PHONE RACK 1.00 65.00 65.00
---------------------------------------------------------------------------------------------------------
2 PROVIDE ELECTRICAL OUTLETS 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------
3 PROVIDE LIGHTING 1.00 75.00 75.00
---------------------------------------------------------------------------------------------------------
4 PROVIDE CEILING FINISH 1.00 75.00 75.00
---------------------------------------------------------------------------------------------------------
5 PROVIDE WALL FINISH 1.00 100.00 100.00
---------------------------------------------------------------------------------------------------------
6 PROVIDE FLOOR FINISH 4.00 250.00 1,000.00
---------------------------------------------------------------------------------------------------------
7 PROVIDE BASE 1.00 80.00 80.00
---------------------------------------------------------------------------------------------------------
8 PROVIDE DOOR/FRAME/HARDWARE 1.00 250.00 250.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
E. GENERAL OFFICE AREA 0.00
---------------------------------------------------------------------------------------------------------
1 PROVIDE SAMPLE AND SPEC. ON CARPET AND PAD 60.00 25.00 1,500.00
---------------------------------------------------------------------------------------------------------
2 PROVIDE BASE 1.00 175.00 175.00
---------------------------------------------------------------------------------------------------------
3 OUTLET FOR HMS 1.00 150.00 150.00
---------------------------------------------------------------------------------------------------------
4 J-BOX FOR HMS 1.00 150.00 150.00
---------------------------------------------------------------------------------------------------------
5 PROVIDE ADEQUATE LIGHTING 1.00 250.00 250.00
---------------------------------------------------------------------------------------------------------
6 PROVIDE FURNITURE 1.00 1,500.00 1,500.00
---------------------------------------------------------------------------------------------------------
7 PROVIDE DESK INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
8 PROVIDE FAX MACHINES 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
F. MANAGER'S OFFICE 0.00
---------------------------------------------------------------------------------------------------------
1 PROVIDE SAFE 1.00 450.00 450.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
G. LIFE SAFETY 0.00
---------------------------------------------------------------------------------------------------------
1 PROVIDE SOUNDING DEVICES/PULL STATIONS COMPLIES 10,000.00 0.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
H. PUBLIC RESTROOMS 0.00
---------------------------------------------------------------------------------------------------------
1 PROVIDE ADA SIGNAGE 2.00 75.00 150.00
---------------------------------------------------------------------------------------------------------
2 REFINISH DOOR AND HARDWARE FOR ADA 2.00 150.00 300.00
---------------------------------------------------------------------------------------------------------
3 PROVIDE TWO COAT HOOKS 4.00 5.00 20.00
---------------------------------------------------------------------------------------------------------
4 REPLACE VANITIES-MAN MADE MARBLE 2.00 450.00 900.00
---------------------------------------------------------------------------------------------------------
5 CONCEAL PIPING BELOW VANITIES 2.00 400.00 800.00
---------------------------------------------------------------------------------------------------------
6 PROVIDE RECESSED FACIAL TISSUE HOLDER 2.00 35.00 70.00
---------------------------------------------------------------------------------------------------------
7 PROVIDE BUILT IN ASHTRAY 2.00 50.00 100.00
---------------------------------------------------------------------------------------------------------
8 REPLACE TILE FLOORS AND GROUT 400.00 8.00 3,200.00
---------------------------------------------------------------------------------------------------------
Page 5
--------------------------------------------------------------------------------------------------------
9 PROVIDE PAPER TOWEL RECEPTACLE IN MEN'S 1.00 250.00 250.00
--------------------------------------------------------------------------------------------------------
10 REPLACE VINYL WALL COVERING (MENS ROOM) 25.00 18.00 450.00
--------------------------------------------------------------------------------------------------------
0.00
I LIFE SAFETY 0.00
--------------------------------------------------------------------------------------------------------
1. PROVIDE SOUNDING DEVICES IN ALL PUBLIC AREAS 1.00 5,000.00 5,000.00
--------------------------------------------------------------------------------------------------------
0.00
J HOSPITALITY/MEETING ROOM (? CONVERT TO EXER/BOARD RM R SUITE) 0.00
--------------------------------------------------------------------------------------------------------
1. CORRECT WATER INFILT PROB FROM OUTSIDE WALLS. CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
2. PROVIDE DOOR SIGNAGE CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
3. REPLACE ACCOUST TILES W/ 2X2 TEGULAR REVEAL EDGE CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
4. CORRECT SEVERE LEAK AT WINDOW DECK WALL CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
5. REPLACE SOFFET & PAINT AT WINDOW/DECK WALL CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
6. PROVIDE WINDOW TREATMENT W/BLACKOUT ABILITY CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
7. PROVIDE DECOR CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
8. PROVIDE 50 FOOT CANDLES OF LIGHT AT TABLE TOP CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
9. REPLACE TABLES & CHAIRS CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
10. PROVIDE AUDIO VISUAL UNIT CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
11. PROVIDE REFIGERATOR/ICE MAKER CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
12. PROVIDE WET BAR UNIT CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
13. PROVIDE MATV /TELEPHONE RECEPTACLE CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
14. PROVIDE PLABTS IN CONTAINERS CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
15. PROVIDE TELEPHONE MESSAGE WAIT SYSTEM CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
16. PROVIDE FULL LENGTH MIRROR ??? CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
17. ADD CARPET BASE CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
18. PROVIDE PANIC HARDWARE ON DOORS CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
19. CLEAN CARPET TO NEW CONDITION CONVERT TO 6 GUEST ROOMS 0.00
--------------------------------------------------------------------------------------------------------
20. CONVERT TO 5 GUEST ROOMS 6.00 25,000.00 150,000.00
--------------------------------------------------------------------------------------------------------
0.00
--------------------------------------------------------------------------------------------------------
0.00
0.00
K. LIFE SAFETY 0.00
--------------------------------------------------------------------------------------------------------
1. PROVIDE VISUAL DEVICES/HORNS & EXIT LIGHTING INCLUDED 0.00
--------------------------------------------------------------------------------------------------------
0.00
--------------------------------------------------------------------------------------------------------
0.00
0.00
K. GAME ROOM 0.00
--------------------------------------------------------------------------------------------------------
0.00
--------------------------------------------------------------------------------------------------------
0.00
--------------------------------------------------------------------------------------------------------
0.00
--------------------------------------------------------------------------------------------------------
0.00
0.00
L. BOARDROOM (WANTS TO ADD BOARD RM DELETE BQT ROOM) 0.00
--------------------------------------------------------------------------------------------------------
1. PROVIDE PERMANANT CONFERANCE TABLE INCLUDED 0.00
--------------------------------------------------------------------------------------------------------
2. PROVIDE CONF. CHAIRS W/CASTERS INCLUDED 0.00
--------------------------------------------------------------------------------------------------------
Page 6
3. PROVIDE VISUAL UNIT BOARD INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
4. PROVIDE TLEVISION/TELEPHONE INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
5. PROVIDE BUILTIN COUNTER, ▇▇▇.SERVICE R TABLE INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
6. PROVIDE WALLS/CEILING FINISH INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
7. PROVIDE FLOOR FINISH INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
8. PROVIDE WINDOW TREATMENT W/BLACKOUT ABILITY INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
9. PROVIDE DECOR INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
10. PROVIDE LIGHTING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
11. PROVIDE SMOKE DETECTOR/SPRINKLER INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
12. CLEAN FLOOR & GOUT TO NEW CONDITION INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
13. CONVERT TO 2 BOARDROOMS 2.00 15,000.00 30,000.00
---------------------------------------------------------------------------------------------------------------
0.00
0.00
III. PRIVATE GUEST AREAS 0.00
0.00
A. GUEST ROOM CORRIDOR 0.00
---------------------------------------------------------------------------------------------------------------
1. ELIMINATE DARK SPOTS BETWEEN RM ENTRIES 81.00 400.00 32,400.00
---------------------------------------------------------------------------------------------------------------
2. PROVIDE DIRECTIONAL SIGNAGE 162.00 65.00 10,530.00
---------------------------------------------------------------------------------------------------------------
3. SPRAY ACCOUSTICAL CEILING TILES WAIVER 0.00
---------------------------------------------------------------------------------------------------------------
4. REPLACE CARPET AND PAD CLEAN
---------------------------------------------------------------------------------------------------------------
5. PROVIDE 5 FOOT CANDLES OF LIGHTING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
6. POSITION LOW SCONCES CORRECTLY INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
7. PROVIDE ADDITIONAL SCONCES INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
8. PROVIDE MAKE-UP AIR SYSTEM/EQUIPMENT 1.00 40,000.00 40,000.00
---------------------------------------------------------------------------------------------------------------
9. CLEAN/REPLACE CARPET & PAD CLEAN 0.00
---------------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------------
0.00
B. LIFE SAFETY 0.00
----------------------------------------------------------------------------------------------------------------
1. PROVIDE MANUAL PULL STATIONS/SOUNDING DEVICES INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
2. FIRE EXTINGUISHERS TO CODE COMPLIES 0.00
----------------------------------------------------------------------------------------------------------------
0.00
C. GUEST VENDING AREAS 0.00
----------------------------------------------------------------------------------------------------------------
1. PROVIDE SIGNAGE INCLUDED 0.00
---------------------------------------------------------------------------------------------------------------
2. CONCEAL ALL WATER LINES, FILTRATION LINES ETC. 6.00 200.00 1,200.00
---------------------------------------------------------------------------------------------------------------
3. REPLACE ICE MACHINES (DISPENSER TYPE) COMPLIES 3,700.00 0.00
----------------------------------------------------------------------------------------------------------------
0.00
D. GUEST STAIRWELLS 0.00
----------------------------------------------------------------------------------------------------------------
1. PROVIDE FIRE SIGNAGE 18.00 25.00 450.00
---------------------------------------------------------------------------------------------------------------
2. PROVIDE EXIT SIGNAGE IN 6" REFLEC LETTERS ON CORR. SID 18.00 35.00 630.00
---------------------------------------------------------------------------------------------------------------
3. ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇" ▇▇▇▇▇▇ # ▇▇ ▇▇▇▇▇ ▇▇▇▇ 18.00 25.00 450.00
---------------------------------------------------------------------------------------------------------------
4. PROVIDE EXIT DIRECTLY TO EXT OF BLDG WAIVER-VERIFY WITH FIRE ▇▇▇▇▇▇▇▇
---------------------------------------------------------------------------------------------------------------
5. REPAIR EIFS CRACKED STAIRWELL WALLS 1.00 3,500.00 3,500.00
---------------------------------------------------------------------------------------------------------------
6. REFINISH LANDING/TREADS 18.00 200.00 3,600.00
---------------------------------------------------------------------------------------------------------------
7. REPLACE LIGHTING FIXTURES 18.00 150.00 2,700.00
----------------------------------------------------------------------------------------------------------------
Page 7
---------------------------------------------------------------------------------------------------------
8. PROVIDE EMEGENCY LIGHTING INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
9. PROVIDE MANUAL PULL STATIONS NEAR DOORS 18.00 250.00 4,500.00
---------------------------------------------------------------------------------------------------------
10. PROVIDE WALL MOUNTED HANDRAILS 18.00 300.00 5,400.00
---------------------------------------------------------------------------------------------------------
11. REPAIR STAIRWELL LANDING AT UNDERSIDE JOINT 1.00 1,500.00 1,500.00
---------------------------------------------------------------------------------------------------------
12. PROVIDE PANIC HARDWARE PER STANDARD 18.00 350.00 6,300.00
---------------------------------------------------------------------------------------------------------
13. PROVIDE LIGHTING AT RM ENTRY PER STANDARD INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
14. REFINISH/REPAINT RAILINGS AT END OF STAIRWELL INCLUDED 0.00 0.00
---------------------------------------------------------------------------------------------------------
15. PAINT SPRINKLER STANDPIPE 1.00 800.00 800.00
---------------------------------------------------------------------------------------------------------
16. ENSURE ALL FIRE EXTING. TESTED AND LABELED M/R 0.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
--------------------------------------------------------------------------------------------------------
0.00
E. ELEVATORS 0.00
---------------------------------------------------------------------------------------------------------
1. ENSURE 36 SECOND MAX WAIT TIME VERIFY CONDITION 0.00
---------------------------------------------------------------------------------------------------------
2. REPLACE CARPET AND PAD 2.00 85.00 170.00
---------------------------------------------------------------------------------------------------------
3. PROVIDE GRABE BARS 32" FROM FLOOR 3 SIDES 2.00 500.00 1,000.00
---------------------------------------------------------------------------------------------------------
4. PROVIDE EMERGENCY LIGHTING 2.00 250.00 500.00
---------------------------------------------------------------------------------------------------------
5. CONFIRM SHAFT WALL RATINGS AT 2 HOURS VERIFY CONDITION 0.00
---------------------------------------------------------------------------------------------------------
6. PROVIDE FIRE SIGNAGE X CABS X LANDING 2.00 500.00 1,000.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
0.00
F. GUEST ROOMS 0.00
---------------------------------------------------------------------------------------------------------
1. REMOVE SIGNAGE & REPAINT DOOR (METAL DOORS) 180.00 35.00 6,300.00
---------------------------------------------------------------------------------------------------------
2. REPLACE DOOR NUMBERS TO CONFORM WITH ADA 162.00 20.00 3,240.00
---------------------------------------------------------------------------------------------------------
3. PROVIDE VINYL BULB TYPE WEATHERSTRIPPING ON ALL 162.00 30.00 4,860.00
---------------------------------------------------------------------------------------------------------
GST ROOM DOORS & CONNECTING DOORS 50.00 25.00 1,250.00
---------------------------------------------------------------------------------------------------------
4. INSTALL ELECTRONIC LOCKSETS PER STANDARD 162.00 225.00 36,450.00
---------------------------------------------------------------------------------------------------------
5. PROVIDE SECONDARY DOOR LOCK W/SAFETY CHAIN 162.00 8.00 1,296.00
---------------------------------------------------------------------------------------------------------
6. REPLACE CONNECTING DOOR HARDWARE 50.00 45.00 2,250.00
---------------------------------------------------------------------------------------------------------
7. PROVIDE STANDARD LOCK CONFIGURATION PER STANDARD INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
8. RMS W/SLIDING GLASS DOUBLE DOORS INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
(POSSIBLE TRIP HAZARD) 0.00
---------------------------------------------------------------------------------------------------------
9. PROVIDE DOUBLE CARPET PAD BETWEEN CONNECT DRS 50.00 30.00 1,500.00
---------------------------------------------------------------------------------------------------------
10. PROVIDE APPROPRIATE HARDWARE TO CONNECT DRS INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
12. PROVIDE CLOSET DOORS W/APPROPRIATE HANGERS 162.00 300.00 48,600.00
---------------------------------------------------------------------------------------------------------
13. PROVIDE 15" DEEP SHELVES 162.00 50.00 8,100.00
---------------------------------------------------------------------------------------------------------
14. REPAIR/CLEAN WALL FINISH 1.00 5,000.00 5,000.00
---------------------------------------------------------------------------------------------------------
15. RECARPET 35 ROOMS 35.00 455.00 15,925.00
---------------------------------------------------------------------------------------------------------
16. TOUCH UP CEILINGS AS NEEDED 162.00 100.00 16,200.00
---------------------------------------------------------------------------------------------------------
17. REPLACE BEDSPREADS 324.00 75.00 24,300.00
---------------------------------------------------------------------------------------------------------
18. PROVIDE NEW PILLOWS, LINEN AND ▇▇▇▇▇ 162.00 85.00 13,770.00
---------------------------------------------------------------------------------------------------------
19. PROVIDE ALARM CLOCKS 162.00 18.00 2,916.00
---------------------------------------------------------------------------------------------------------
20. PROVIDE LUGGAGE BENCH W/WOOD BUMBERS ABOVE 162.00 125.00 20,250.00
---------------------------------------------------------------------------------------------------------
Page 8
------------------------------------------------------------------------------------------------------------------------
21. PROVIDE TWO DRAWER CHESTS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------------
22. REPLACE ALL 19" CASE GOODS 132.00 1,000.00 132,000.00
------------------------------------------------------------------------------------------------------------------------
23. PROVIDE TV ARMOIRES X EA ROOM INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------------
24. REMOVE ALL TV PEDESTALS 30.00 350.00 10,500.00
------------------------------------------------------------------------------------------------------------------------
25. PROVIDE DESK & DESK CHAIR IN ▇▇▇▇ ▇▇ 30.00 300.00 9,000.00
------------------------------------------------------------------------------------------------------------------------
26. PROVIDE NEW ACTIVITY CHAIRS 324.00 125.00 40,500.00
------------------------------------------------------------------------------------------------------------------------
27. PROVIDE NEW TABLES WITH PEDESTAL BASES INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------------
28. PROVIDE LOUNGE CH/OTTOMAN R RECLINER, KING ROOM 30.00 300.00 9,000.00
------------------------------------------------------------------------------------------------------------------------
29. REPLACE SOFA SLEEPERS 6.00 600.00 3,600.00
------------------------------------------------------------------------------------------------------------------------
30. PROVIDE COFFEE TABLES WITH SOFA SLEEPERS 6.00 125.00 750.00
------------------------------------------------------------------------------------------------------------------------
31. REPLACE ALL ORIG NIGHTSTANDS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------------
32. REPLACE ALL FORMICA CASEGOODS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------------
33. REPLACE HEADBOARDS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------------
34. REPLACE LIGHTING 162.00 200.00 32,400.00
------------------------------------------------------------------------------------------------------------------------
35. REPLACE WALL DECOR 35 ROOMS 132.00 120.00 15,840.00
------------------------------------------------------------------------------------------------------------------------
36. PROVIDE 1 XTRA LARGE PIX OVER SOFA IN ▇▇▇▇ ▇▇ 30.00 60.00 1,800.00
------------------------------------------------------------------------------------------------------------------------
37. REPLACE MATTRESSES & BOX SPRINGS 60 DD ROOMS 120.00 200.00 24,000.00
------------------------------------------------------------------------------------------------------------------------
38. PROVIDE GARMENT BAG HOOKS 5 TO 6 ABOVE FLOOR 162.00 15.00 2,430.00
------------------------------------------------------------------------------------------------------------------------
39. PROVIDE PORTABLE LUGGAGE RACKS IN DD ROOMS INCLUDED 0.00
------------------------------------------------------------------------------------------------------------------------
40 INSTALL UNITS FOR MICROFRIDGE/WAVE 100.00 200.00 20,000.00
------------------------------------------------------------------------------------------------------------------------
41. PROVIDE CARPET OR VINYL BASE IN ALL GST RM SUITES 162.00 105.00 17,010.00
------------------------------------------------------------------------------------------------------------------------
0.00
------------------------------------------------------------------------------------------------------------------------
0.00
0.00
G. EQUIPMENT 0.00
-------------------------------------------------------------------------------------------------------------------------
1. REPLACE WORN HVAC UNITS 5.00 600.00 3,000.00
-------------------------------------------------------------------------------------------------------------------------
2. REPLACE GRILLS INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------
3. REPLACE TELEVISIONS 7YRS OR OLDER ALL W/REMOTES 162.00 300.00 48,600.00
-------------------------------------------------------------------------------------------------------------------------
4. PROVIDE TELEPHONES W/14 CORDS 162.00 18.00 2,916.00
-------------------------------------------------------------------------------------------------------------------------
5. PROVIDE DATA JACKS 162.00 8.00 1,296.00
-------------------------------------------------------------------------------------------------------------------------
6. PROVIDE MATV OUTLETS 0.00
-------------------------------------------------------------------------------------------------------------------------
0.00
H. MISC/SUITES 0.00
-------------------------------------------------------------------------------------------------------------------------
1. PROVIDE 75% NON-SMOKING ROOMS INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------
2. ENSURE RECLINERS IN NEW CONDITION 6.00 300.00 1,800.00
-------------------------------------------------------------------------------------------------------------------------
3. REPLACE SLEEPER SOFAS 6.00 600.00 3,000.00
-------------------------------------------------------------------------------------------------------------------------
4. INSTALL CARPET AND BASE 420.00 13.00 5,460.00
-------------------------------------------------------------------------------------------------------------------------
5. CLEAN REFRIDG TO NEW CONDITION 6.00 600.00 3,600.00
-------------------------------------------------------------------------------------------------------------------------
6. REPLACE SINKS ADD GARBAGE DISPOS. 6.00 500.00 3,000.00
-------------------------------------------------------------------------------------------------------------------------
7. INSTALL RECESSED LIGHTING 6.00 300.00 1,800.00
-------------------------------------------------------------------------------------------------------------------------
8. PROVIDE CHAIR & BAR STOOLS TO MATCH CASEGDS 6.00 300.00 1,800.00
-------------------------------------------------------------------------------------------------------------------------
9. INSTALL VWC IN KITCHEN SUITE AREAS 150.00 12.00 1,800.00
-------------------------------------------------------------------------------------------------------------------------
10. TOUCH UP WOOD TRIM CABNETRY 6.00 150.00 900.00
-------------------------------------------------------------------------------------------------------------------------
11. REPLACE BOWED COUNTERTOPS 6.00 1,200.00 7,200.00
-------------------------------------------------------------------------------------------------------------------------
Page 9
-------------------------------------------------------------------------------------------------------------------------------
0.00
-------------------------------------------------------------------------------------------------------------------------------
0.00
I GUEST BATHROOMS 0.00
-------------------------------------------------------------------------------------------------------------------------------
1. REPLACE DOOR HARDWARE 162.00 30.00 4,860.00
-------------------------------------------------------------------------------------------------------------------------------
2. REFINISH DOORS/FRAMES 162.00 25.00 4,050.00
-------------------------------------------------------------------------------------------------------------------------------
3. REPLACE ALL FLOOR BASE TILES 162.00 350.00 56,700.00
-------------------------------------------------------------------------------------------------------------------------------
4. REPLACE FLOOR TILE GROUT INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------------
5. REPAIR/CLEAN VWC AS NEEDED 162.00 150.00 24,300.00
-------------------------------------------------------------------------------------------------------------------------------
6. INSTALL EXHAUST FAN SWITCHES 162.00 75.00 12,150.00
-------------------------------------------------------------------------------------------------------------------------------
7. REPLACE LIGHTING 162.00 125.00 20,250.00
-------------------------------------------------------------------------------------------------------------------------------
8. REPLACE VANITIES 162.00 400.00 64,800.00
-------------------------------------------------------------------------------------------------------------------------------
9. REPLACE SINKS 162.00 85.00 13,770.00
-------------------------------------------------------------------------------------------------------------------------------
10. PROVIDE VANITY BASE CABINETS INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------------
12. PROVIDE DUAL ROLL TISSUE DISPENSER 162.00 45.00 7,290.00
-------------------------------------------------------------------------------------------------------------------------------
13. PROVIDE TOWEL BAR/SHELF W/BRACKETS 162.00 40.00 6,480.00
-------------------------------------------------------------------------------------------------------------------------------
14. PROVIDE STACK RACKS 162.00 20.00 3,240.00
-------------------------------------------------------------------------------------------------------------------------------
15. REPLACE TUBS AS NEEDED 162.00 250.00 40,500.00
-------------------------------------------------------------------------------------------------------------------------------
16. PROVIDE FULL LENGTH MIRRORS 162.00 45.00 7,290.00
-------------------------------------------------------------------------------------------------------------------------------
17. REPLACE SHOWER CHROME & ESCUTCHEON PLATES 162.00 85.00 13,770.00
-------------------------------------------------------------------------------------------------------------------------------
18. REPLACE TUB TILE GROUT 162.00 65.00 10,530.00
-------------------------------------------------------------------------------------------------------------------------------
19. PROVIDE TWO SOAP DISHES 162.00 45.00 7,290.00
-------------------------------------------------------------------------------------------------------------------------------
20. REPLACE SHOWER CURTAINS 162.00 12.00 1,944.00
-------------------------------------------------------------------------------------------------------------------------------
21. PROVIDE SHOWERS AT 6'6" HEIGHT 162.00 12.00 1,944.00
-------------------------------------------------------------------------------------------------------------------------------
22. PROVIDE 24" VERTICLE GRAB BARS 162.00 25.00 4,050.00
-------------------------------------------------------------------------------------------------------------------------------
23. REPLACE TOILET SEATS W/OPEN FRONT SEATS & LIDS 162.00 25.00 4,050.00
-------------------------------------------------------------------------------------------------------------------------------
24. PROVIDE RESERVE TISSUE DISPENSER INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------------
25. PROVIDE DOUBLE ROBE HOOK 162.00 5.00 810.00
-------------------------------------------------------------------------------------------------------------------------------
0.00
-------------------------------------------------------------------------------------------------------------------------------
0.00
J. HANDICAPS ROOM 0.00
-------------------------------------------------------------------------------------------------------------------------------
1. PROVIDE 2ND DOOR VIEWER 42" FROM FLOOR 10.00 5.00 50.00
-------------------------------------------------------------------------------------------------------------------------------
0.00
-------------------------------------------------------------------------------------------------------------------------------
0.00
K. HANDICAP BATHROOMS 0.00
-------------------------------------------------------------------------------------------------------------------------------
1. PROVIDE HANDICAP EQUIPMENT 10.00 200.00 2,000.00
-------------------------------------------------------------------------------------------------------------------------------
2. PROVIDE 2 30" HORIZONTAL BARS @ 9" ABOVE TUB 10.00 350.00 3,500.00
-------------------------------------------------------------------------------------------------------------------------------
AND 3'0" ABOVE FINISH FLOOR ON SOAPDISH WALL INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------------
3. PROVIDE 24" HORIZONTAL GRAB BARS 24" ABOVE TOILET\ INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------------
AT 33"-36" ABOVE FINISH FLOOR INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------------
4. PROVIDE 24" HORIZONTAL GRAB BARS BOTH ENDS OF TUB INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------------
5. PROVIDE 42" GRAB BAR ABOVE TOILET INCLUDED 0.00
-------------------------------------------------------------------------------------------------------------------------------
6. ENSURE ALL SWITCHES ARE ACCESSABLE 48" OR LOWER 10.00 75.00 750.00
-------------------------------------------------------------------------------------------------------------------------------
7. PROVIE 30" CLEARANCE UNDER LAVATORY COUNTER 10.00 300.00 3,000.00
-------------------------------------------------------------------------------------------------------------------------------
8. PROVIDE HAND HELD SHOWER ON FLEX HOSE 10.00 35.00 350.00
-------------------------------------------------------------------------------------------------------------------------------
Page 10
0.00
IV. BACK OF THE HOUSE 0.00
0.00
0.00
A. LAUNDRY / GENERAL LINEN AREA 0.00
---------------------------------------------------------------------------------------------------------
1. PAINT WALLS 1.00 450.00 450.00
---------------------------------------------------------------------------------------------------------
2. PROVIDE VIONYL WALL BASE 1.00 250.00 250.00
---------------------------------------------------------------------------------------------------------
3. PROVIDE HEATING/AC 1.00 5,000.00 5,000.00
---------------------------------------------------------------------------------------------------------
4. PROVIDE TELEPHONE 1.00 125.00 125.00
---------------------------------------------------------------------------------------------------------
5. PROVIDE DRYER ENCLOSURE W/HEAT DETECTOR 1.00 1,200.00 1,200.00
---------------------------------------------------------------------------------------------------------
6. PROVIDE COMBUSTION AIR LOUVER 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------
7. PROVIDE MAKE-UP AIR LOUVER 1.00 500.00 500.00
---------------------------------------------------------------------------------------------------------
8. PROVIDE FIRST AID KIT 1.00 45.00 45.00
---------------------------------------------------------------------------------------------------------
9. PAINT EXPPOSED PIPING TO NEW CONDITION 1.00 450.00 450.00
---------------------------------------------------------------------------------------------------------
10. PAINT CMU WALLS TO NEW CONDITION 1.00 250.00 250.00
---------------------------------------------------------------------------------------------------------
11. CLEAN UP CHEM STORAGE AREA M/R 0.00
---------------------------------------------------------------------------------------------------------
12. ENSURE ALL PENETRATIONS ARE PROPERLY FIREPROOF 1.00 200.00 200.00
---------------------------------------------------------------------------------------------------------
0.00
B. LINEN/MAIDS ROOM 0.00
---------------------------------------------------------------------------------------------------------
1. REFINISH ENTRANCE DOORS 3.00 35.00 105.00
---------------------------------------------------------------------------------------------------------
2. PROVIDE SIGNAGE INCLUDED 0.00
---------------------------------------------------------------------------------------------------------
3. REFINISH DOOR FRAME 3.00 35.00 105.00
---------------------------------------------------------------------------------------------------------
4. INSTALL VINYL COMPOSITE TILE FLOORS 3.00 2,500.00 7,500.00
---------------------------------------------------------------------------------------------------------
5. PROVIDE ADDITIONAL SHELVING 3.00 450.00 1,350.00
---------------------------------------------------------------------------------------------------------
6. REPAINT WALLS 3.00 250.00 750.00
---------------------------------------------------------------------------------------------------------
7. CONCEAL ALL PIPING AND WIRING 3.00 600.00 1,800.00
---------------------------------------------------------------------------------------------------------
0.00
C. MAINTENANCE SHOP 0.00
---------------------------------------------------------------------------------------------------------
1. PROVIDE 10LB ABC FIRE EXTINGUISHER 1.00 65.00 65.00
---------------------------------------------------------------------------------------------------------
2. REMOVE CLUTTER M/R 0.00
---------------------------------------------------------------------------------------------------------
3. ENSURE NO FLAMMABLES STORED IN MAINT. SHOP M/R 0.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
D. EMPLOYEE BREAKROOM 0.00
---------------------------------------------------------------------------------------------------------
1. PROVIDE WALL CABINETS 1.00 800.00 800.00
---------------------------------------------------------------------------------------------------------
2. PROVIDE BASE CABINETS 1.00 800.00 800.00
---------------------------------------------------------------------------------------------------------
3. PROVIDE SINK 1.00 350.00 350.00
---------------------------------------------------------------------------------------------------------
4. PROVIDE TABLE AND CHAIRS 3.00 600.00 1,800.00
---------------------------------------------------------------------------------------------------------
5. PROVIDE LIGHTING 1.00 350.00 350.00
---------------------------------------------------------------------------------------------------------
6. PROVIDE 10 LOCKERS 1.00 800.00 800.00
---------------------------------------------------------------------------------------------------------
0.00
---------------------------------------------------------------------------------------------------------
0.00
V. MISCELLANEOUS 0.00
Page 11
0.00
A. WATER/HEATING 0.00
-----------------------------------------------------------------------------------------------------------------
1. PAINT BOILER CABINETRY 1.00 200.00 200.00
-----------------------------------------------------------------------------------------------------------------
2. PROVIDE WATER SOFTENER WAIVER - BASED UPON WATER REPORT
-----------------------------------------------------------------------------------------------------------------
3. REPAINT WALLS 1.00 250.00 250.00
-----------------------------------------------------------------------------------------------------------------
4. ENSURE BOILERS PROPERLY EXHAUSTED COMPLIES 0.00
-----------------------------------------------------------------------------------------------------------------
5. ENSURE GENERATOR WORKS PROPERLY COMPLIES 0.00
-----------------------------------------------------------------------------------------------------------------
6. PAINT WALLS BY GENERATOR 1.00 200.00 200.00
-----------------------------------------------------------------------------------------------------------------
7. REPAIR LEAK AT SPRINKLER SYSTEM M/R 0.00
-----------------------------------------------------------------------------------------------------------------
8. PAINT/FINISH CMU WALLS 1.00 500.00 500.00
-----------------------------------------------------------------------------------------------------------------
9. PAINT PIPING 1.00 300.00 300.00
-----------------------------------------------------------------------------------------------------------------
10. REMOVE CORROSION 1.00 200.00 200.00
-----------------------------------------------------------------------------------------------------------------
11. PROVIDE DIELECTRIC UNIONS ON PIPING WAIVER 0.00
-----------------------------------------------------------------------------------------------------------------
12. REPLACE BENT DUCTING 1.00 800.00 800.00
-----------------------------------------------------------------------------------------------------------------
13. REPLACE/REPAIR EXHAUST FANS IF INOPERABLE M/R 0.00
-----------------------------------------------------------------------------------------------------------------
14. ENSURE ROOFTOP UNITS SERVICED PROPERLY M/R 0.00
-----------------------------------------------------------------------------------------------------------------
0.00
-----------------------------------------------------------------------------------------------------------------
0.00
0.00
B. ELECTRICAL EQUIP ROOM (EACH FLOOR) 0.00
-----------------------------------------------------------------------------------------------------------------
1. PROVIDE HEAT DETECTORS 6.00 250.00 1,500.00
-----------------------------------------------------------------------------------------------------------------
0.00
B. HMS SYSTEM 0.00
-----------------------------------------------------------------------------------------------------------------
1. PROVIDE COMPUTERS 1.00 35,000.00 35,000.00
-----------------------------------------------------------------------------------------------------------------
2. PROVIDE PRINTERS INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
3. PROVIDE MONITORS INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
4. PROVIDE SATELLITE DISH INCLUDED 0.00
-----------------------------------------------------------------------------------------------------------------
0.00
C. TELEPHONE SYSTEM 0.00
-----------------------------------------------------------------------------------------------------------------
1. PROVIDE CALL WAITING SYSTEM COMPLIES PER 25,000.00 0.00
-----------------------------------------------------------------------------------------------------------------
0.00
D. MATV 0.00
-----------------------------------------------------------------------------------------------------------------
1. PROVIDE 24 HOUR MOVIE CHANNEL 0.00
-----------------------------------------------------------------------------------------------------------------
VI. GENERAL CONDITIONS
-----------------------------------------------------------------------------------------------------------------
A. GENERAL CONDITIONS 1,780,670.00 0.07 124,646.90
-----------------------------------------------------------------------------------------------------------------
B. DEPARTMENT INCENTIVES 1,780,670.00 0.01 13,355.03
-----------------------------------------------------------------------------------------------------------------
C. DEPARTMENT OVERHEAD 1,780,670.00 0.01 13,355.03
-----------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
TOTAL: 1,932,026.95
---------------------------------------------------------------------------------------------------------------------------
Page ▇▇
▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇.
SUMMARY
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
------------------------------------------------------------------------------------------------------------------
TOTAL $50,000.00
------------------------------------------------------------------------------------------------------------------
Page ▇
▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇.
CAPITAL IMPROVEMENT GENERAL OVERVIEW - PRODUCT IMPROVEMENT PLAN
-------------------------------------------------------------------------------------------------------------------
RE'D QUANITY/ UNIT
AREAS SCOPE OF WORK YES ALLOWANCE COST
-------------------------------------------------------------------------------------------------------------------
C. MISCELLANEOUS
---------------------------------------------------------------------------------------------------------
1. HAMPTON PIP ITEMS - ALLOWANCE 1.00 50,000.00
---------------------------------------------------------------------------------------------------------
VII. GENERAL CONDITIONS
---------------------------------------------------------------------------------------------------------
A. ALLOWANCE - 15% OF TOTAL 0.00
---------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
TOTAL 50,000.00
-------------------------------------------------------------------------------------------------------------------
Page 2
SCHEDULE 1.01(d)
ENGINEER
SCOPE OF SERVICES
PROPERTY CONDITION REVIEW
(PCR)
ASSIGNMENT OBJECTIVES
---------------------
The purpose of the Property Condition Review (PCR) is: To determine the existing
conditions of the building(s) and its systems including structural, plumbing,
heating and ventilating, air conditioning, electrical, fire protection, finish
materials, exterior facades, roof, and site amenities. To identify any areas or
materials which may require repair or corrective action due to deferred
maintenance or present deficient conditions. To identify and list any
outstanding code violations against the property on file with the various
Municipal and Federal agencies, including the local building department, fire
department, etc. To evaluate the adequacy of the capacities of the HVAC and
electrical systems. To perform an Americans with Disabilities Act (ADA) survey
of the existing building(s) and property to determine compliance with the
legislation. To estimate the cost of the required remedial work indicated by any
of the preceding determinations. Note: The Property Condition Review (PCR)
assignment does not include any work with environmental issues, but Consultant
should be generally aware of and note any obvious existing or potential
conditions. Consultant shall utilize personnel having the appropriate
professional designations for those tasks outlined above (at a minimum, an AIA
and PE).
The Property Condition Review (PCR) assignment should include, at a minimum, a
review and description of the following aspects of the Project:
1. A description of the site and all improvements thereon, based upon field
observations as well as a review of all available documents.
2. Determine the general conformance of visible construction of the building
and site development to the construction documents, soils report, and
industry standards for such construction.
3. Consultant shall list all codes, regulations and public sector criteria
with which the Project must comply, including special permits, zoning,
development orders and other actions of local, state, and federal
authorities. Copies of the actual documents (building permits, certificates
of occupancy, etc.) should be included in the report.
4. Review of existing conditions of the building including exterior, roof,
interior spaces, MEP systems, structural members (including seismic
conditions, where applicable), site drainage, parking, landscaping and site
utilities; with conclusions and recommendations for conceivable repairs and
deficiencies along with cost estimates for the suggested repairs. Estimates
should be provided in the following format: IMMEDIATE, SHORT-TERM (1-5
years), and LONG-TERM REPAIRS (1-10 years).
1
5. Review should include interviews and discussions with the property manager,
building engineer, maintenance staff, etc. Interior spaces reviewed should
include an adequate number of units or leased spaces to conclude an opinion.
6. Determine the appropriateness of the existing building materials found in
place, with regard to the need for extraordinary maintenance or low
durability potential, and with respect to the quality of materials and
findings for the type of facility as built.
7. Conduct a replacement cost analysis (insurable value) to determine the
potential cost of all construction in current year's dollars adjusted for
project location.
8. Consultant shall determine and state the estimated remaining useful life of
the property.
9. Conduct a thorough review of the overall project for owner-related Americans
with Disabilities Act (ADA) requirements to determine compliance with this
legislation, listing all current violations and cost estimates for their
recommended implementation.
10. Consultant shall provide two original reports, including color photographs
with labeled descriptions to more clearly define examples of unique
features, overall building condition, defective conditions and potential
repair/maintenance requirements as determined by any of the proceeding
findings. Consultant shall also provide statement of qualifications
information on their respective firm, including evidence of required
insurance coverages (naming Societe Generale, Southwest Agency, as
additional insured).
SAMPLE OUTLINE REPORT FORMAT
PROPERTY CONDITION REVIEW
-------------------------
I. Executive Summary
II. Objectives
III. Project Description and Overview
IV. Replacement Cost Analysis
V. ADA Survey Results
VI. Conclusions
VII. Project Documentation Log - listing and copies of documents received and
reviewed.
VIII. Project Observations - note date of review, parties present, and
interviews held.
IX. Photographs
2
--------------------------------------------------------------------------------
SCHEDULE 1.01 APPROVED ENGINEERS
* ATEC ASSOCIATES/ATC
* EMG
* LAW ENGINEERING
* ▇▇▇▇▇ ▇▇▇▇▇▇▇ & PARTNERS, INC.
* CONSTRUCTION ASSET ADVISORS, INC.
* HNTB CORPORATION
* THE BENTLEY GROUP
Future reports will be provided by EMG, however, a periodic review and bid
process will be undertaken to insure quality reports.
--------------------------------------------------------------------------------
SCHEDULE 1.01(f)
ENVIRONMENTAL
SCOPE OF SERVICES
PHASE I ENVIRONMENTAL SITE ASSESSMENT
(ESA)
ASSIGNMENT OBJECTIVES
---------------------
The Phase I Environmental Site Assessment (ESA) survey is for the determination
of the condition of the Property (building(s) and site) as it relates to any
existing and potential hazardous waste materials or situations. The Scope should
address and comply with the new ASTM E 1527 Environmental Assessment standards
or standards set forth below, whichever is more stringent.
The ESA assignment should include at a minimum a review and description of the
following aspects of the Property:
1. Identify project name, legal description, geographic coordinates, local
address, city, county and state for each site.
2. Provide a general description of the Property and site improvements,
including acres, square footages and age of improvements.
3. Identify inspection date and consultant performing the inspection. Describe
the qualifications of the individual conducting the inspection.
4. Conduct and review a fifty-year recorded Chain of Title search. Identify
and review historical and current property uses/ownerships. Use ▇▇▇▇▇▇▇
maps and local directories when available and appropriate.
5. Review historical and current aerial photographs, and provide in the report
at least two original aerials (one from pre-1975, and one after 1985).
Provide a narrative discussion of the aerial photo review. Aerial
photographs should show the subject Property and surrounding areas.
6. Perform an on-site environmental inspection of the subject Property.
Interview on-site personnel and adjacent property owners where appropriate,
and provide records of all such communications. Review the available on-
site environmental records, including the compliance history of the subject
Property, if any.
7. Review and discuss groundwater and surface water characteristics. Include a
general direction of the gradient as well as depth to potable and shallow
groundwater. Include a description of groundwater uses and surface water
bodies on-site. Discuss any available existing data on water quality.
Consultant should have someone with Hydrology or Hydro-Geology credentials
specifically comment on this matter.
8. Review and discuss area geology and soil characteristics. Identify the
general soil permeability and corrosiveness tendencies. Discuss any
available data on soil conditions.
1
9. Identify and describe any hazardous materials used or stored on-site,
significant spills, dumping, emissions, evidence of contaminated soils or
water. Specifically,
a) Describe uses for hazardous materials; identify all wastestreams
generated at the site; and describe handling and disposal methods and
waste management handling, storage, and disposal areas. Also include a
discussion about areas previously used for these purposes, if any.
b) List permits and authorizations held, and describe permitted
activities, operating restrictions, and compliance reports,
inspections, and orders.
c) Discuss whether on-site electrical equipment contains PCBs, and
identify the party with compliance responsibility.
d) Describe in detail the observed on-site conditions of waters, soils,
vegetation, and production and waste management areas.
e) Review records of spills and release events, and describe materials
and areas involved, remediation activities, and regulatory agency
involvement, if any.
f) Consultant should address all environmental concerns, including but
not limited to special statutory issues, lead paint, lead in drinking
water and wetlands.
10. Perform and discuss a one mile area reconnaissance, and describe all
adjacent site usages. Identify all potential sources of off-site
contamination and the impact of these findings, including landfills,
gasoline stations, industrial facilities, tank terminals, airports and
military bases or installations.
11. Review and provide all local, state and federal regulatory agency inquiry
(EPA, TWC, etc.) results for the site - as well as for properties contained
within a one mile radius of the site. Specifically discuss: The NPL List,
CERCLIS, ▇▇▇▇ Title III, RCRA Notifiers List, TSD List, UST List, LUST
List, and Landfill List. For Properties found on these lists, identify
distance, direction and any potential impact to the subject site.
12. For USTs and ASTs on-site or within one mile radius - identify the number
of tanks, registration, size, age, tank contents and tank material for
each. For offsite tanks, identify distance, direction and subsurface
gradient direction from site for each. Describe former USTs on-site and
also the compliance status of current on-site USTs.
13. Review and provide local government and municipal inquiry results. Include
at least the following: the electric company, water/sewer authorities,
city/county health department and local fire ▇▇▇▇▇▇▇▇'▇ office. Provide a
record of these communications.
14. A sufficient number of asbestos and radon samples should be taken,
analyzed, and discussed to provide a representative sampling. The number of
samples may vary, but the rationale for determining the number and location
of the samples should be described. Provide information on: methods of
analysis and laboratory used, sample collection method, and certification
of the inspectors, as per the attached EXHIBIT A. Describe and locate on
plan the locations and materials sampled.
15. Provide a color topographical area site map, with scale, noting the subject
site.
2
16. If available, describe the circumstances of any known citizen complaints in
the area, the nature of the facility's relationship with its neighbors and
citizens, etc.
17. Provide a professionally prepared and detailed site map of the project,
noting all adjacent properties, location of any USTs, ASTs, drums,
transformers, areas of contamination, waste management areas, etc.
18. Provide a minimum of eight color labeled photographs depicting the site and
adjacent sites.
19. A copy of all records of communications (ROCs) should be provided in the
report for each including: date and time of a conversation, name and title
of person, name of company and a brief summary of the topic discussed. Also
provide a copy of all permits, available soil and water data, and any
available enforcement records and documents.
20. Provide a list of any and all published references utilized.
21. Provide a statement of qualifications on the firm conducting the
assessment, and evidence of all required insurance coverages (naming
Societe Generale, Southwest Agency, as additional insured).
22. Two original reports are required for this assignment, and should follow,
in general, the outline on the last page.
3
EXHIBIT "A"
ASBESTOS SURVEY
The asbestos survey shall be performed by appropriately trained personnel,
trained in accordance with the most recent federal, state and local
requirements, including but not limited to AHERA. The personnel shall determine
if suspect ACM is present. Suspect friable ACM shall be reported on and sampled
according to the following scope. Suspect non-friable ACM shall be reported on
according to the following scope, but without sampling.
The consultant's report shall include the following:
---------------------------------------------------
- The date(s) the inspection/sampling was performed.
- A general description of construction, mechanical, and electrical
systems at the property based on the site visit and a cursory review of
construction documents (drawings, specifications, change orders, etc.), if
available.
- A description of the history of the property, including the dates of
original construction and the dates and scopes of major remodeling work.
- A description of any prior asbestos abatement work that was performed
at the property and an evaluation of the work's compliance with governing codes,
statutes, regulations and ordinances.
- A review of the suspect materials throughout the property and a
description of the sampling strategy. A sufficient number of samples should be
obtained in order to conclude the specific results required.
- An evaluation of the condition of any and all positive material found
at the property in accordance with a hazard ranking system. Note material
locations with respect to building occupants, potential for disturbance and air
flow.
- A description of the process for inspection and representative
sampling for asbestos-containing materials.
- A summary of testing results and a graphic representation of the
locations from which the samples were taken indicating which samples are
positive.
- An estimate of the total quantity of ACM (friable and non-friable)
within the entire facility, including each tenant space, mechanical area, office
area, maintenance area and common area. Provide an estimate of probable costs to
correct or remove ACM's identified from the positive sampling process and
survey.
- A list of tenants at the property, by name and space number, the
materials sampled and the results of the analysis and the quantity of asbestos
found.
- The signature of the responsible individual. The individual shall
certify that the sampling and report has been conducted and prepared according
to the licensing requirements of the state in which the property is located.
4
SAMPLE OUTLINE REPORT FORMAT
PHASE I ENVIRONMENTAL SITE ASSESSMENT
1. Executive Summary
2. Objectives
3. Site Overview
4. Site Background/Operating History
a) Current Ownership
b) Prior Ownership
c) Review of Aerial Photographs
d) Historical City Directories/Fire Insurance Maps
5. Environmental Setting
a) Surface Water Characteristics
b) Ground Water Characteristics
c) Soils/Geology
6. Results of the On-Site Inspection
a) Observations
b) Hazardous Substance Identification/Inventory
c) Area Reconnaissance
d) Sampling Results (Asbestos) (Radon)
7. Regulatory/Governmental Agency Inquiries
a) Federal and State Regulatory Agency Inquiries
b) City Governmental Inquiries
8. Conclusions
9. Recommendations
a) Additional Studies
b) O & M Program
10. References
11. Appendices
a) Recorded Chain of Title
b) Aerial Photographs
c) Photographs
d) Permits/Records
12. Tables
a) Asbestos and Radon Sampling Results
5
================================================================================
SCHEDULE 1.01Q APPROVED ENVIRONMENTAL
CONSULTANTS
* ATEC ASSOCIATES/ATC
* EMG
* LAW ENGINEERING
* ▇▇▇▇▇▇▇
* FUGRO WEST, INC.
* ▇▇▇▇ ENGINEER, INC.
* RERC
Future reports will be provided by EMG, however, a periodic review and bid
process will be undertaken to insure quality reports.
================================================================================
SCHEDULE 1.01(h)
Franchisors
BRAND OR AFFILIATION CONSIDERATIONS FOR AGHC FUTURE ACQUISITIONS
DOUBLETREE HOTELS CORPORATION DoubleTree Hotel or Resort
DoubleTree Club Hotel
DoubleTree Guest Suites Hotel
HILTON HOTELS CORPORATION Hilton Hotel, Inn or Resort
Hilton Suites Hotel
Hilton Garden Inn
HOLIDAY INN WORLDWIDE Crowne Plaza Hotel or Resort
Holiday Inn
Holiday Inn Express
Holiday Inn Hotel & Suites
Holiday Inn Select
Holiday Inn Sunspree Resort
HYATT HOTELS CORPORATION Hyatt Regency Hotel or Resort
Hyatt Hotel
ITT SHERATON CORPORATION Sheraton Hotel or Resort
Sheraton Suites Hotel
Four Points Hotel
MARRIOTT CORPORATION Marriott Hotel or Resort
Marriott Suites Hotel
Residence Inn
Fairfield Inn, Inn & Suites
Courtyard by Marriott
OMNI HOTELS Omni Hotel or Resort
PROMUS HOTEL CORPORATION Embassy Suites Hotel or Resort
Homewood Suites
Hampton Inn, Inn & Suites
RADISSON HOTELS WORLDWIDE Radisson Hotel, Plaza Hotel or Resort
Radisson Inn
Radisson Suite Hotel
WESTIN HOTELS & RESORTS Westin Hotel or Resort
WYNDHAM HOTELS AND RESORTS Wyndham Hotel or Resort
Wyndham Garden Hotel
POSSIBLE (IF FRANCHISING BECOMES
AVAILABLE) Renaissance Hotels & Resorts
Red Lion Hotels & Inns
▇▇▇▇-▇▇▇▇▇▇▇
Inter-Continental
Four Seasons
Sofitel/Novotel
Nikko
Le Meridian/Forte
AmeriSuites
Vista/Hilton International
Fairmont
▇▇▇▇'▇ ▇▇▇▇
SCHEDULE 1.01(i)
Ground Leases
-------------
ALBUQUERQUE, NEW MEXICO
That certain ground lease by and between the City of Albuquerque, New
Mexico and ▇▇▇▇ ▇▇▇▇▇▇, Inc. dated November 10, 1969 as amended by the
First Supplemental Lease Agreement dated May 17, 1971 and the Second
Supplemental Lease Agreement dated October 2, 1972.
NEW ORLEANS, LOUISIANA
That certain Sublease Agreement between ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, as sub-lessor,
and Grantor, as sublessee, dated July 8, 1994 and recorded in ▇▇▇ ▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ of that certain Lease of Commercial
Property granted by Mon-Tay Enterprises, Inc., as owner, and ▇▇▇▇▇
▇▇▇▇▇▇▇▇, as lessee, dated December 11, 1985 recorded in COB ▇▇▇▇, ▇▇▇▇▇
▇▇, ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
SAN JOSE, CALIFORNIA
That certain Sublease dated as of February 1, 1973 executed by and between
Claitor Properties Co. and Hotel Circle, Inc. and recorded on February 7,
1973 in Book 0225, Page 727 of the Official Records, as assigned to ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Company, as recorded on June 14, 1976 in Book C080, Page
157 in the Official Records, as further assigned to The Chase Manhattan
Bank (National Association), and recorded on September 17, 1976 in Book
C288, Page 36, as further assigned to North First-▇▇▇▇ Corporation, as
recorded on September 17, 1976 in Book C288, Page 45, as amended by that
certain Amendment to Sublease dated December 1, 1978 by and between Claitor
Properties Co. and North First-▇▇▇▇ Corporation and recorded on March 13,
1979 in Book E340, Page 285, as further assigned to ▇▇ ▇▇▇▇▇ Hotels, Inc.
and recorded on March 13, 1979 in Book E341, Page 258, and as further
amended by that certain Consent to Amendment of Sublease and Release of
Reserved Right dated April 11, 1980 executed by and between ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, as Trustees, ▇▇ ▇▇▇▇▇ Hotels, Inc. and The
Chase Manhattan Bank, N.A. and recorded on April 29, 1980 in Book F298,
Page 632 of the Official Records.
TOLEDO, OHIO
That certain Lease by and among the State of Ohio, acting by and through
the Department of Administrative Services, the Medical College of Ohio at
Toledo, an Ohio College of Medicine authorized and created by Section
3350.01, Ohio Revised Code ("MCO"), and Toledo Hotel Investors Limited
Partnership, an Ohio limited partnership ("Original Lessee"),
recorded at Recorder's Number 86-0812A01 of the records of the ▇▇▇▇▇ County
Recorder, under which State and MCO leased to Original Lessee a certain
unimproved approximately 8,781 acre tract of land located on the campus of MCO
in Toledo, Lucas County, Ohio; as modified by and Affidavit dated November 15,
1986, recorded December 16, 1986, at Recorder's Number 86-1943A08 of the records
of the ▇▇▇▇▇ County Recorder; as further amended by First Amendment to Lease by
and among State, MCO, and Original Lessee, recorded March 24, 1988, at
Recorder's Number 88-332C11 of the records of the ▇▇▇▇▇ County Recorder; as
further amended by Second Amendment to Lease by and among State, MCO, and
Original Lessee, recorded October 30, 1992, at Recorder's Number 92-3155C04 of
the records of the ▇▇▇▇▇ County Recorder; as further affected by that certain
Cooperating Agreement dated May 23, 1986, by and between MCO and Original Lessee
-2-
SCHEDULE 1.01(j)
Guarantors
----------
American General Hospitality Corporation, a Maryland corporation
AGH UPREIT, LLC, a Delaware limited liability company
3100 Glendale Joint Venture, an Ohio general partnership
MDV Limited Partnership, a Texas limited partnership
Madison Motel Associates, a Wisconsin general partnership
183 Hotel Associates, Ltd., a Texas limited partnership
Richmond Williamsburg Associates, Ltd., a Texas limited partnership
2929 ▇▇▇▇▇▇▇▇ Limited Liability Company, a Delaware limited liability company
SCHEDULE 1.01(K)
HOTEL AND CAPITAL OPERATING LEASE LIMITS
Hotel Capital Lease Limit - Capital Leases will be limited to no more than
$1,000 per room.
Hotel Operating Lease Limit - Operating Leases will be limited to no more than
$750 per room.
Schedule 1.01(l)
LIQUOR CORPS FOR REIT HOTELS
Courtyard by Marriott Secaucus
New Jersey Beverage Management, Inc.
Holiday Inn DFW South
Beverage & Lounge Management, Inc.
Holiday Inn DFW West
ELF Management, Inc.
Holiday Inn New Orleans Airport
Kenner Beverage Management, Inc.
Hotel Maison de Ville
American General Hospitality of Louisiana, Inc.
Hilton Hotel Toledo
Ohio Beverage Management, Inc.
Holiday Inn East Towne Madison
Madison Lounge, Incorporated
Holiday Inn Park Center Plaza San ▇▇▇▇
SJBMI
Holiday Inn Mission Valley San Diego
SDBMI
LeBaron Hotel San ▇▇▇▇
LBBMI
Best Western ABQ Airport Hotel
Albuquerque Beverage Management, Inc.
Schedule 1.01(m)
PARTICIPATING LEASES
1. Lease Agreement between American General Hospitality Operating Partnership,
L.P. ("Borrower") and AGH Leasing, L.P. (the "Lessee") with respect to
Holiday Inn Park Center Plaza, dated of even date herewith.
2. Lease Agreement between Borrower and Lessee with respect to Holiday Inn
Mission Valley, dated of even date herewith.
3. Lease Agreement between Borrower and Lessee with respect to Days and Ocean
City, dated of even date herewith.
4. Lease Agreement between Borrower and Lessee with respect to LeBaron Hotel,
dated of even date herewith.
5. Lease Agreement between Borrower and Lessee with respect to ▇▇▇▇ ▇▇▇▇▇▇
Albuquerque Airport Hotel, dated of even date herewith.
6. Lease Agreement between 2929 ▇▇▇▇▇▇▇▇ Limited Liability Company and Lessee
with respect to Holiday Inn New Orleans Airport (Kenner), dated of even
date herewith.
7. Lease Agreement between 3100 Glendale Joint Venture and Lessee with respect
to Hilton Hotel Toledo, dated of even date herewith.
8. Lease Agreement Between MDV Limited Partnership and Lessee with respect to
Hotel Maison De Ville, dated of even date herewith.
9. Lease Agreement between Madison Motel Associates and Lessee with respect to
Holiday Inn Select Madison, dated of even date herewith.
10. Lease Agreement between 183 Hotel Associates, Ltd. and Lessee with respect
to Holiday Inn Dallas ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, dated of even date herewith.
11. Lease Agreement between Richmond Williamsburg Associates, Ltd. and Lessee
with respect to Hampton and Richmond Airport, dated of even date herewith.
Schedule 4.01
SUBSIDIARIES
NAME STATE OF FORMATION PRINCIPAL OFFICE
---- ------------------ ----------------
2929 ▇▇▇▇▇▇▇▇ Limited Liability Company Delaware ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
MDV Limited Partnership Texas ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Madison Motel Associates Wisconsin ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
183 Hotel Associates, Ltd. Texas ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
455 Meadowlands Associates, Ltd.* Texas ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
DFW South Limited Partnership* Texas ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Richmond Williamsburg Associates, Ltd. Texas ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
AGH UPREIT LLC Delaware ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
AGH Secaucus LLC* Delaware ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
AGH DFW South LLC* Delaware ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
____________________________
* Permitted other subsidiary
SCHEDULE 4.08
PENDING LITIGATION
Hotel Litigation Insured Company
----- ---------- ------- -------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Best Western ABQ Airport Hotel N/A
------------------------------------------------------------------------------------------------------------------------------------
Courtyard by Marriott-Meadowlands 9/21/95-▇▇▇▇▇▇▇▇-Slipped & fell on sidewalk Yes Fireman's Fund
------------------------------------------------------------------------------------------------------------------------------------
Day's Inn-Ocean City N/A
------------------------------------------------------------------------------------------------------------------------------------
Hampton Inn-Richmond Airport N/A
------------------------------------------------------------------------------------------------------------------------------------
Hotel-Toledo Hilton 9/27/93-Suesse-Slipped & fell in parking lot. Yes ITT Hartford
------------------------------------------------------------------------------------------------------------------------------------
Holiday Inn-DFW South N/A
------------------------------------------------------------------------------------------------------------------------------------
Holiday Inn-DFW West N/A
------------------------------------------------------------------------------------------------------------------------------------
Holiday Inn-East Towne N/A
------------------------------------------------------------------------------------------------------------------------------------
Holiday Inn-Mission Valley N/A
------------------------------------------------------------------------------------------------------------------------------------
Holiday Inn-New Orleans Eatheray Cage- Workers' Compensation Yes Prior Management Company
------------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇/▇
------------------------------------------------------------------------------------------------------------------------------------
Hotel Maison De Ville N/A
------------------------------------------------------------------------------------------------------------------------------------
▇▇ ▇▇▇▇▇ Hotel N/A
------------------------------------------------------------------------------------------------------------------------------------
Knowledge of outstanding litigation is limited to the above.
In all cases insurance is available to cover the loss
A comprehensive insurance plan is also available should any
new litigation arise. Claims which have not yet been reported which
occurred prior to AGHC ownership will be referred to the prior owner's
insurance company. An aggressive claim prevention & claim management plan
will be maintained for these properties.
H Bertini, ARM
Director, Risk & Insurance Services
American General Hospitality Inc.
SCHEDULE 4.15
Loan and Lease Disclosures
Space Leases
. ▇▇ ▇▇▇▇▇ - San ▇▇▇▇ -- Full Service Beauty Salon Lease with ▇▇▇▇ ▇▇▇▇▇▇.
. ▇▇ ▇▇▇▇▇ - San ▇▇▇▇ -- Gift Shop Lease with Hanif Saya and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
(dba Golden Choice Enterprises).
. ▇▇ ▇▇▇▇▇ - San ▇▇▇▇ -- Enterprise Rent-A-Car.
. ▇▇▇▇ ▇▇▇▇▇▇ Hotel - Albuquerque -- Lease of Roof Space for Antennas with:
ABQ Ambulance Service, ▇▇▇▇▇ Company, QTE Airfone, Motorola, Inc.,
Presbyterian Healthcare.
. Hotel Maison de Ville - New Orleans -- Restaurant Lease "The Bistro" with
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇.
. Holiday Inn - Park Center Plaza - San ▇▇▇▇ -- Gift Shop Lease.
. Holiday Inn Select - Madison -- Gift Shop Lease with Judy's Wisconsin Gift
Shop
. Holiday Inn Select - Madison -- Enterprise Rent-A-Car.
. Holiday Inn DFW South - Dallas -- Gift Shop Lease with US West Financial
Services.
Schedule 4.17
LEGAL REQUIREMENTS; ZONING; UTILITIES; ACCESS
1. ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇; ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇-
----------------------------------------------------
The Property has a sign located on Almaden Boulevard which does not
meet the Zoning Code. In addition, the property was developed as a hotel
before the requirements for a Conditional Use Permit and, therefore, is
considered a legal non-conforming use.
2. leBaron Airport Hotel, San Jose, California-
--------------------------------------------
When the Hotel was constructed, San ▇▇▇▇ required Site Development
Permit approval, but not Conditional Use Permit approval. A hotel is now
permitted in this ▇-▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ with Conditional Use Permit
approval. The Hotel, however, only obtained the Site Development Permits
and variances required at the time of construction including:
(1) a variance to reduce the number of off-street parking spaces;
approved May 8, 1972;
(2) a variance to grant an increase in height to 9-stories, approved
May 8, 1972;
(3) a variance to reduce off-street loading spaces from seven to one
for the Hotel, approved November 9, 1972; and
(4) a Site Development Permit for a 9-story, 302 room hotel with a
2-story banquet, coffee shop, cocktail lounge, and kitchen,
approved March 5, 1973.
The Hotel, therefore, is considered a legal non-conforming use.
3. Hotel Maison De Ville Louisiana; New Orleans, louisiana-
--------------------------------------------------------
The current use is in compliance with the City of New Orleans
Comprehensive Zoning Ordinance as a legal non-conforming use provided the
guest accommodations are used for the purpose of offering overnight lodging
facilities to the general public for comprehensive.
SCHEDULE 4.19
PARTICIPATING LESSEE PERSONAL PROPERTY
Approximately $435,000 of equipment, fixtures, furniture and other personal
property owned in connection with the Hotel Properties located in Alburquerque,
New Mexico and San ▇▇▇▇ (Park Center Plaza), California.
SCHEDULE 4.21
CASH MANAGEMENT SYSTEMS
TENANT OPERATING ACCOUNTS
MAINTAINED WITH CASH MANAGER
================================================================================
ACCOUNT NAME ACCOUNT NO.
================================================================================
AGH Leasing, L.P. 1822924419
American General Hospitality, Inc., Manager
(Days Inn Ocean City) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924427
American General Hospitality, Inc., Manager
(Hampton Inn Richmond Airport) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924443
American General Hospitality, Inc., Manager
(Holiday Inn DFW West) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924450
American General Hospitality, Inc., Manager
(Holiday Inn New Orleans Airport) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924468
American General Hospitality, Inc., Manager
(Hotel Maison De Ville) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924476
American General Hospitality, Inc., Manager
(Hilton Hotel Toledo) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924484
American General Hospitality, Inc., Manager
(Holiday Inn East Towne Madison) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924492
American General Hospitality, Inc., Manager
(Holiday Inn Park Center Plaza San ▇▇▇▇) - Operating Account
--------------------------------------------------------------------------------
================================================================================
ACCOUNT NAME ACCOUNT NO.
================================================================================
AGH Leasing, L.P. 1822924500
American General Hospitality, Inc. Manager
(Holiday Inn Mission Valley San Diego) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924518
American General Hospitality, Inc., Manager
(Best Western ▇▇▇▇ ▇▇▇▇▇▇ Hotel) - Operating Account
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1822924526
American General Hospitality, Inc., Manager
(LeBaron Hotel San ▇▇▇▇) - Operating Account
================================================================================
TENANT LOCAL DEPOSIT ACCOUNTS
MAINTAINED WITH DEPOSITORY BANKS
================================================================================
ACCOUNT NAME ACCOUNT NO.
================================================================================
AGH Leasing, L.P. Depository Account
------------------
American General Hospitality, Inc., Manager 3933669120
(Days Inn Ocean City) - Depository Account
------------------
NationsBank
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. ▇▇▇▇▇▇▇▇▇▇
American General Hospitality, Inc., Manager
(Hampton Inn Richmond) - Depository Account
------------------
Central Fidelity
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1000006028
American General Hospitality, Inc., Manager
(Holiday Inn DFW West) - Depository Account
------------------
First Interstate Bank
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 0019756
American General Hospitality, Inc., Manager
(Holiday Inn New Orleans Airport) - Depository Account
------------------
Metairie Bank & Trust
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
1
================================================================================
ACCOUNTING NAME ACCOUNT NO.
================================================================================
AGH Leasing, L.P. 110648986
American General Hospitality, Inc., Manager
(Hotel Maison de Ville) - Depository Account
------------------
First National Bank of Commerce
▇▇▇ ▇▇▇▇▇▇▇ ▇▇.
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 5002885083
American General Hospitality, Inc., Manger
(Hilton Hotel Toledo) - Depository Account
------------------
Society Bank & Trust
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
------------------------------------------------------------------------------
AGH Leasing, L.P. 0004787233
American General Hospitality, Inc., Manger
(Holiday Inn East Towne Madison) - Depository Account
------------------
M&I Bank of Madison
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 8501079662
American General Hospitality, Inc., Manger
(Holiday Inn Park Center Plaza San ▇▇▇▇) - Depository Account
------------------
Comerica Bank
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
2
================================================================================
ACCOUNT NAME ACCOUNT NO.
================================================================================
AGH Leasing, L.P.
American General Hospitality, Inc., Manager
(Holiday Inn Mission Valley San Diego) - Depository Account
------------------
Bank of America
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 6011010755
American General Hospitality, Inc., Manager
(Best Western ABQ Airport Hotel/▇▇▇▇ ▇▇▇▇▇▇) - Depository
----------
Account
-------
First Security Bank
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P.
American General Hospitality, Inc., Manager
(LeBaron Hotel San ▇▇▇▇) - Depository Account
------------------
Bank of America
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 3933669133
American General Hospitality, Inc., Manager
(Days Inn Ocean City) - General Manager Account
-----------------------
NationsBank
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
3
================================================================================
ACCOUNT NAME ACCOUNT NO.
================================================================================
AGH Leasing, L.P. ▇▇▇▇▇▇▇▇▇▇
American General Hospitality, Inc., Manager
(Hampton Inn Richmond) - General Manager Account
-----------------------
Central Fidelity
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 1000006036
American General Hospitality, Inc., Manager
(Holiday Inn DFW West) - General Manager Account
-----------------------
First Interstate Bank
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 0019763
American General Hospitality, Inc., Manager
(Holiday Inn New Orleans Airport) - General Manager Account
-----------------------
Metairie Bank & Trust
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 110648994
American General Hospitality, Inc., Manager
(Hotel Maison de Ville) - General Manager Account
-----------------------
First National Bank of Commerce
▇▇▇ ▇▇▇▇▇▇▇ ▇▇.
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
4
================================================================================
ACCOUNT NAME ACCOUNT NO.
================================================================================
AGH Leasing, L.P. 5002885095
American General Hospitality, Inc., Manager
(Hilton Hotel Toledo) - General Manager Account
-----------------------
Society Bank & Trust
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 0004787189
American General Hospitality, Inc., Manager
(Holiday Inn East Towne Madison) - General Manager Account
-----------------------
M&I Bank of Madison
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P. 8501079670
American General Hospitality, Inc., Manager
(Holiday Inn Park Center Plaza San ▇▇▇▇) - General Manager
---------------
Account
-------
Comerica Bank
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
AGH Leasing, L.P.
American General Hospitality, Inc., Manager
(Holiday Inn Mission Valley San Diego) - General Manager
---------------
Account
-------
Bank of America
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------
5
========================================================================
ACCOUNT NAME ACCOUNT NO.
========================================================================
AGH Leasing, L.P. 6011010649
American General Hospitality, Inc., Manager
(Best Western ABQ Airport Hotel/▇▇▇▇ ▇▇▇▇▇▇) - General
-------
Manager Account
---------------
First Security Bank
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
------------------------------------------------------------------------
AGH Leasing, L.P.
American General Hospitality, Inc., Manager
(LeBaron Hotel San ▇▇▇▇) - General Manager Account
-----------------------
Bank of America
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
========================================================================
6
PARTNERSHIP ACCOUNTS
MAINTAINED WITH CASH MANAGER
========================================================================
ACCOUNT NAME ACCOUNT NO.
========================================================================
American General Hospitality Corporation 1822924534
------------------------------------------------------------------------
AGH Leasing, L.P. 1822924609
------------------------------------------------------------------------
AGHL GP, Inc. 1822924617
------------------------------------------------------------------------
AGH UPREIT LLC 1822924625
------------------------------------------------------------------------
AGH GP, Inc. 1822924716
------------------------------------------------------------------------
3100 Glendale Joint Venture 1822924641
Hilton Hotel and Conference Center, Toledo, OH
------------------------------------------------------------------------
MDV Limited Partnership 1822924658
Hotel Maison de Ville, New Orleans, LA
------------------------------------------------------------------------
Madison Motel Associates 1822924666
Holiday Inn Select, Madison, WI
------------------------------------------------------------------------
183 Hotel Associates, Ltd. 1822924674
Holiday Inn DFW Airport West
------------------------------------------------------------------------
Richmond Williamsburg Associates, Ltd. 1822924682
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇
------------------------------------------------------------------------
2929 ▇▇▇▇▇▇▇▇ Limited Liability Company 1822924732
Holiday Inn New Orleans Airport, LA
========================================================================
1
OTHER ACCOUNTS
MAINTAINED WITH CASH MANAGER
===============================================================================
ACCOUNT NAME ACCOUNT NO.
===============================================================================
American General Hospitality Operating Partnership, L.P. 1822924542
Operating Account (Borrower)
-------------------------------------------------------------------------------
Bank One Texas, N.A. as Administrative Agent for the benefit of 1892347897
American General Hospitality Operating Partnership, L.P.
Concentration Bank Account
-------------------------------------------------------------------------------
Bank One Texas, N.A. as Administrative Agent for the benefit of 1892347905
American General Hospitality Operating Partnership, L.P.
CapEx Reserve Account
===============================================================================
1
SCHEDULE 4.22
-------------
Franchise Agreements expected to terminate (a) Date of Termination (b) Fees Due (c) Replacement Franchise (d)
Holiday Inn Select East Towne - Madison, WI July 31, ▇▇▇▇ -▇- ▇▇▇▇▇ ▇▇▇▇▇
Days Inn - Ocean City, MD July 31, ▇▇▇▇ -▇- ▇▇▇▇ ▇▇▇ (6 mos)/Hampton Inn
Holiday Inn New Orleans Airport - Kenner, LA July 31, ▇▇▇▇ -▇- ▇▇▇▇▇▇▇ ▇▇▇ Select
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇, ▇▇ July 31, ▇▇▇▇ -▇- ▇▇▇▇▇▇▇ ▇▇▇ (6 mos)/Double Tree
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ - ▇▇▇ ▇▇▇▇, ▇▇ July 31, ▇▇▇▇ -▇- ▇▇▇▇▇▇ ▇▇▇▇▇
Holiday Inn D/FW Airport South - Irving, TX July 31, 1996 -0- Holiday Inn
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇▇▇, ▇▇ July 31, ▇▇▇▇ -▇- ▇▇▇▇▇▇▇ Inn
Replacement Franchise Material Terms
CROWNE PLAZA EAST TOWNE - MADISON WI
Term: 10 years
Royalty Fees: Will operate as a Holiday Inn until renovations are complete
(1st qtr 1997)
Holiday Inn
Franchise Fees = 5% of Rooms Revenue
Marketing Contribution = 1.5% of Rooms Revenue
Reservation Contribution = 1% of Rooms Revenue
Monthly Reservation Fee = $1,459.61
Crowne Plaza
Franchise Fees = 4% of Rooms Revenue for years 1-3
5% of Rooms Revenue thereafter
Marketing Contribution = 2% of Rooms Revenue
Reservation Contribution = 1% of Rooms Revenue
Monthly Reservation Fee = $1,459.61
DAYS INN - OCEAN CITY, MD
Term: 1 year with 30-day notice of termination with no damages after 6
months
Royalty Fees: 8.8% of Room Revenue
Hampton Inn
Term: 21 Years
Royalty Fees: Franchise Fees = 4% of Room Revenue
Marketing/Reservation Contribution = 4% of Room Revenue
HOLIDAY INN SELECT NEW ORLEANS AIRPORT - KENNER, LA
Term: 10 Years
Royalty Fees: Will operate as a Holiday Inn until renovations are complete
(1st qtr 1997)
Holiday Inn
Franchise Fees = 5% of Rooms Revenue
Marketing Contribution = 1.5% of Rooms Revenue
Reservation Contribution = 1% of Rooms Revenue
Monthly Reservation Fee = $1,954.72
Holiday Inn Select
Franchise Fees = 5% of Rooms Revenue
Marketing Contribution = 2% of Rooms Revenue
Reservation Contribution = 1% of Rooms Revenue
Monthly Reservation Fee = $1,954.72
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇, ▇▇
Term: Holiday Inn - 10 Years; DoubleTree - 10 Years
Royalty Fees: Will operate as a Holiday Inn until renovations are complete
(1st qtr 1997)
Holiday Inn
Franchise Fees = 5% of Rooms Revenue
Marketing Contribution = 1.5% of Rooms Revenue
Reservation Contribution = 1% of Rooms Revenue
Monthly Reservation Fee = $2,031.88
DoubleTree
Franchise Fees = 2% of Rooms Revenue for year 1
3% of Rooms Revenue for year 2
4% of Rooms Revenue thereafter
Marketing Contribution = 3.5% of Rooms Revenue
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ - ▇▇▇ ▇▇▇▇, ▇▇
Term: 10 years
Royalty Fees: Will operate as a Holiday Inn until renovations are complete
(1st qtr 1997)
Holiday Inn
Franchise Fees = 5% of Rooms Revenue
Marketing Contribution = 1.5% of Rooms Revenue
Reservation Contribution = 1% of Rooms Revenue
Monthly Reservation Fee = $1,485.33
Crowne Plaza
Franchise Fees = 2% of Rooms Revenue for years 1-2
4% of Rooms Revenue for year 3
5% of Rooms Revenue thereafter
Marketing Contribution = 2% of Rooms Revenue
Reservation Contribution = 1% of Rooms Revenue
Monthly Reservation Fee = $1,485.33
HOLIDAY INN D/FW AIRPORT SOUTH - IRVING, TX
Term: 10 years
Royalty Fees: Franchise Fees = 4% of Rooms Revenue for 1 year
5% of Rooms Revenue thereafter
Marketing Contribution = 1.5% of Rooms Revenue
Reservation Contribution = 1% of Rooms Revenue
Monthly Reservation Fee = $2,629.87
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇▇, ▇▇
Term: 12 years
Royalty Fees: Franchise Fees = 4% of Room Revenue
Marketing/Reservation Contribution = +% of Room Revenue
Schedule 4.23
MANAGEMENT AGREEMENTS
1. Management Agreement between AGH Leasing, L.P. ("Lessee") and American
General Hospitality, Inc. ("Manager") with respect to Holiday Inn Park
Center Plaza, dated of even date herewith.
2. Management Agreement between Lessee and Manager with respect to Holiday Inn
Mission Valley, dated of even date herewith.
3. Management Agreement between Lessee and Manager with respect to Days and
Ocean City, dated of even date herewith
4. Management Agreement between Lessee and Manager with respect to LeBaron
Hotel Airport, dated of even date herewith
5. Management Agreement between Lessee and Manager with respect to ▇▇▇▇ ▇▇▇▇▇▇
Albuquerque Airport Hotel, dated of even date herewith.
6. Management Agreement between Lessee and Manager with respect to New Orleans
Airport Kenner, dated of even date herewith.
7. Management Agreement between Lessee and Manager with respect to Hilton
Hotel Toledo, dated of even date herewith.
8. Management Agreement between Lessee and Manager with respect to Hilton
Maison de Ville, dated of even date herewith.
9. Management Agreement between Lessee and Manager with respect to Holiday Inn
Select Madison, dated of even date herewith.
10. Management Agreement between Lessee and Manager with respect to Holiday
Dallas ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, dated of even date herewith.
11. Management Agreement between Lessee and Manager with respect to Hampton and
Richmond Airport, dated of even date herewith.
Schedule 5.06
PCR REPAIRS
------------------------------------------------------------------------------------------------------------------------------
AMERICAN GENERAL HOSPITALITY TRUST
------------------------------------------------------------------------------------------------------------------------------
PROPERTY CONDITION REVIEW (PCR)
------------------------------------------------------------------------------------------------------------------------------
REQUIRED REPAIRS
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
FIRM REPORT
------------------------------------------------------------------------------------------------------------------------------
NO. PROPERTY NAME LOCATION NAME DATE REPORT ITEM NUMBER
--- ------------- -------- ---- ---- -------------------
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
1 Holiday Inn DFW-South Irving, TX EMG 4/11/96 6.4; 6.5
------------------------------------------------------------------------------------------------------------------------------
EMG 6/18/96 2.1 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
2 Holiday Inn DFW-West Dallas, TX ATEC 4/12/96 4.1.1; 4.1.2 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ EMG 4/11/96 None required
------------------------------------------------------------------------------------------------------------------------------
EMG 6/18/96 2.1 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ EMG 4/11/96 None required
------------------------------------------------------------------------------------------------------------------------------
EMG 6/18/96 2.1 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
5 Hilton Toledo Toledo, OH EMG 4/9/96 None required
------------------------------------------------------------------------------------------------------------------------------
EMG 6/18/96 2.1 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ATEC 4/10/96 4.1.1; 4.1.2; 4.1.3; (ADA unknown)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
7 Holiday Inn NO Airport Kenner, LA ATEC 4/13/96 4.1.1; 4.1.2; 4.1.3; 4.1.8 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
8 Holiday Inn Select Madison, WI EMG 4/5/96 5.3; 5.5
------------------------------------------------------------------------------------------------------------------------------
EMG 6/18/96 2.1 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ATEC 4/10/96 4.1.3; 4.1.6 (ADA)
------------------------------------------------------------------------------------------------------------------------------
ATC 7/23/96 None required
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
10 Holiday Inn San Jose, CA HRB 12/10/95 report unacceptable
------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇ 12/15/95 update report to confirm
------------------------------------------------------------------------------------------------------------------------------
structural repairs
------------------------------------------------------------------------------------------------------------------------------
ATEC 6/27/96 4.1.4 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
11 ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇ ATEC 4/10/96 4.1.1; 4.1.2; 4.1.3 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ EMG 4/4/96 None required
------------------------------------------------------------------------------------------------------------------------------
EMG 6/18/96 2.1 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
13 Days Inn Ocean City, MD ATEC 4/10/96 4.1.2 - 4.1.6; 4.1.7 (ADA)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
ESA RQMNTS
---------------------------------------------------------------------------------------------------------------------------
AMERICAN GENERAL HOSPITALITY TRUST
---------------------------------------------------------------------------------------------------------------------------
ENVIRONMENTAL SITE ASSESSMENT (ESA)
---------------------------------------------------------------------------------------------------------------------------
REQUIRED ITEMS
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
FIRM REPORT
---------------------------------------------------------------------------------------------------------------------------
NO. PROPERTY NAME LOCATION NAME DATE REPORT ITEM NUMBER
--- ------------- -------- ---- ---- -------------------
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
1 Holiday Inn DFW-South Irving, TX RERC 1/17/96 3.7.b (O & M program)
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
2 Holiday Inn DFW-West Dallas, TX ATEC 4/24/96 5.2 (O & M program)
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ EMG 4/3/96 None required
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ EMG 3/29/96 None required
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
5 Hilton Toledo Toledo, OH EMG 3/29/96 None required
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ EMG 4/10/96 6.6 (O & M program)
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
7 Holiday Inn NO Airport Kenner, LA ATEC 4/26/96 None required
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
8 Holiday Inn Select Madison, WI EMG 3/29/96 None required
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ EMG 4/12/96 6.6 (O & M program)
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ Ocean west 10/4/88 asbestos survey - see
---------------------------------------------------------------------------------------------------------------------------
below
---------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇ 12/14/95 4.5; 5.0 - see below
---------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇ 1/11/96 5.0 - None required
---------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇ 1/12/96 4.5 - Need O & M program
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
11 Holiday Inn Mission Val San Diego, CA EMG 4/10/96 None required
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ EMG 4/3/96 None required
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
13 Days Inn Ocean City, MD EMG 4/8/96 None required
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
SCHEDULE 9.02
Notices
-------
DOMESTIC LENDING OFFICE LIBOR LENDING OFFICE
----------------------- --------------------
SOCIETE GENERALE, SOUTHWEST AGENCY SOCIETE GENERALE, SOUTHWEST AGENCY
4900 ▇▇▇▇▇▇▇▇ ▇▇▇▇ Center 4900 ▇▇▇▇▇▇▇▇ ▇▇▇▇ Center
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Attn: ▇▇. ▇▇▇▇▇▇ ▇. Day Attn: ▇▇. ▇▇▇▇▇▇ ▇. Day
Vice President Vice President
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Telecopy: (▇▇▇)▇▇▇-▇▇▇▇ Telecopy: (▇▇▇)▇▇▇-▇▇▇▇
BANK ▇▇▇, ▇▇▇▇▇, ▇.▇. ▇▇▇▇ ▇▇▇, ▇▇▇▇▇, N.A.
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Attn: Commercial Real Estate Department Attn: Commercial Real Estate Department
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Vice President Vice President
Telephone: (▇▇▇)▇▇▇-▇▇▇▇ Telephone: (▇▇▇)▇▇▇-▇▇▇▇
Telecopy: (▇▇▇)▇▇▇-▇▇▇▇ Telecopy: (▇▇▇)▇▇▇-▇▇▇▇