LEASE AGREEMENT
DATED AS OF JANUARY __, 1997
BY AND BETWEEN
HPTSLC CORPORATION,
AS LANDLORD
AND
WHC SALT LAKE CITY CORPORATION,
AS TENANT
TABLE OF CONTENTS
ARTICLE 1: DEFINITIONS.......................................................1
1.1 Additional Rent ...............................................1
1.2 Additional Charges ............................................1
1.3 Affiliated Person .............................................2
1.4 Agreement .....................................................2
1.5 Applicable Laws ...............................................2
1.6 Award .........................................................2
1.7 Base Total Hotel Sales ........................................3
1.8 Base Year .....................................................3
1.9 Business Day ..................................................3
1.10 Capital Addition ..............................................3
1.11 Capital Expenditure ...........................................4
1.12 Claim .........................................................4
1.13 Code ..........................................................4
1.14 Commencement Date .............................................4
1.15 Condemnation ..................................................4
1.16 Condemnor .....................................................4
1.17 Consolidated Financials .......................................4
1.18 Date of Taking ................................................4
1.19 Default .......................................................4
1.20 Disbursement Rate .............................................4
1.21 Distribution ..................................................5
1.22 Encumbrance ...................................................5
1.23 Entity.........................................................5
1.24 Environment ...................................................5
1.25 Environmental Obligation ......................................5
1.26 Environmental Notice ..........................................5
1.27 Event of Default ..............................................5
1.28 Excess Total Hotel Sales.......................................5
1.29 Extended Terms ................................................5
1.30 FF&E Estimate..................................................5
1.31 FF&E Reserve...................................................5
1.32 Financial Officer's Certificate ...............................5
1.33 Fiscal Year ...................................................6
1.34 Fixed Term ....................................................6
1.35 Fixtures ......................................................6
1.36 GAAP ..........................................................6
1.37 Government Agencies............................................6
1.38 Hazardous Substances ..........................................6
1.39 Hotel .........................................................7
1.40 Hotel Mortgage ................................................7
1.41 Hotel Mortgagee ...............................................7
1.42 Immediate Family...............................................7
1.43 Impositions ...................................................7
1.44 Incidental Documents ..........................................8
1.45 Indebtedness ..................................................8
1.46 Insurance Requirements ........................................9
1.47 Interest Rate..................................................9
1.48 Land ..........................................................9
1.49 Landlord ......................................................9
1.50 Landlord Liens.................................................9
1.51 Lease Year ....................................................9
1.52 Leased Improvements ...........................................9
1.53 Leased Intangible Property ....................................9
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1.54 Leased Personal Property .....................................10
1.55 Leased Property ..............................................10
1.56 Leasehold Mortgage............................................10
1.57 Leasehold Mortgagee...........................................10
1.58 Legal Requirements ...........................................10
1.59 Lending Institution ..........................................10
1.60 Lien .........................................................10
1.61 Limited Guaranty .............................................11
1.63 Manager ......................................................11
1.64 Minimum Rent .................................................11
1.65 Notice .......................................................11
1.66 Officer's Certificate ........................................11
1.67 Overdue Rate .................................................11
1.68 Parent........................................................11
1.69 Permitted Encumbrances .......................................11
1.70 Permitted Liens ..............................................11
1.71 Permitted Use ................................................11
1.72 Person .......................................................12
1.73 Pledge and Security Agreement.................................12
1.74 Records ......................................................12
1.75 Rent .........................................................12
1.76 SEC ..........................................................12
1.77 Security Deposit..............................................12
1.78 State.........................................................12
1.79 Stock Pledge Agreement .......................................12
1.80 Subordinated Creditor ........................................12
1.81 Subordination Agreement ......................................12
1.82 Subsidiary ...................................................12
1.83 Successor Landlord ...........................................12
1.84 Tangible Net Worth ...........................................12
1.85 Tenant .......................................................13
1.86 Tenant's Personal Property ...................................13
1.87 Term .........................................................13
1.88 Total Hotel Sales.............................................13
1.89 Uniform System of Accounts ...................................14
1.90 Unsuitable for Its Permitted Use .............................14
1.91 Work .........................................................14
1.92 Wyndham ......................................................14
ARTICLE 2: LEASED PROPERTY AND TERM.........................................14
2.1 Leased Property................................................14
2.2 Condition of Leased Property...................................16
2.3 Fixed Term.....................................................16
2.4 Extended Term..................................................16
ARTICLE 3: RENT.............................................................17
3.1 Rent...........................................................17
3.1.1 Minimum Rent........................................17
3.1.2 Additional Rent.....................................18
3.1.3 Additional Charges..................................20
3.2 Late Payment of Rent, Etc......................................22
3.3 Net Lease......................................................23
3.4 No Termination, Abatement, Etc.................................23
3.5 Security Deposit...............................................24
ARTICLE 4: USE OF THE LEASED PROPERTY.......................................25
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4.1 Permitted Use..................................................25
4.1.1 Permitted Use.......................................25
4.1.2 Necessary Approvals.................................26
4.1.3 Lawful Use, Etc.....................................26
4.2 Compliance with Legal/Insurance Requirements, Etc..............26
4.3 Environmental Matters..........................................26
4.3.1 Restriction on Use, Etc.............................26
4.3.2 Indemnification of Landlord.........................27
4.3.3 Survival............................................28
ARTICLE 5: MAINTENANCE AND REPAIRS..........................................28
5.1 Maintenance and Repair.........................................28
5.1.1 Tenant's General Obligations........................29
5.1.2 FF&E Reserve........................................29
5.1.3 Landlord's Obligations..............................31
5.1.4 Nonresponsibility of Landlord, Etc..................32
5.2 Tenant's Personal Property.....................................32
5.3 Yield Up.......................................................33
5.4 Management Agreement...........................................33
ARTICLE 6: IMPROVEMENTS, ETC................................................34
6.1 Improvements to the Leased Property. .........................34
6.2 Improvement Advances...........................................35
6.3 Improvements Financed by Landlord..............................36
6.4 Salvage........................................................36
ARTICLE 7: LIENS............................................................36
7.1 Liens..........................................................36
7.2 Landlord's Lien................................................37
ARTICLE 8: PERMITTED CONTESTS...............................................37
ARTICLE 9: INSURANCE AND INDEMNIFICATION....................................38
9.1 General Insurance Requirements.................................38
9.2 Replacement Cost...............................................39
9.3 Waiver of Subrogation..........................................40
9.4 Form Satisfactory, Etc.........................................40
9.5 Blanket Policy.................................................41
9.6 No Separate Insurance..........................................41
9.7 Indemnification of Landlord....................................41
ARTICLE 10: CASUALTY........................................................42
10.1 Insurance Proceeds............................................42
10.2 Damage or Destruction.........................................42
10.2.1 Damage or Destruction of Leased Property..........42
10.2.2 Partial Damage or Destruction.....................43
10.2.3 Insufficient Insurance Proceeds...................43
10.2.4 Disbursement of Proceeds..........................43
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10.3 Damage Near End of Term.......................................44
10.4 Tenant's Property.............................................45
10.5 Restoration of Tenant's Property..............................45
10.6 No Abatement of Rent..........................................45
10.7 Waiver........................................................45
ARTICLE 11: CONDEMNATION....................................................45
11.1 Total Condemnation, Etc.......................................45
11.2 Partial Condemnation..........................................46
11.3 Abatement of Rent.............................................47
11.4 Temporary Condemnation........................................47
11.5 Allocation of Award...........................................48
ARTICLE 12: DEFAULTS AND REMEDIES...........................................48
12.1 Events of Default.............................................48
12.2 Remedies......................................................51
12.3 Tenant's Waiver...............................................52
12.4 Application of Funds..........................................52
12.5 Landlord's Right to Cure Tenant's Default.....................52
ARTICLE 13: HOLDING OVER....................................................53
ARTICLE 14: LANDLORD'S NOTICE OBLIGATIONS; LANDLORD DEFAULT.................53
14.1 Landlord Notice Obligation....................................53
14.2 Landlord's Default............................................53
ARTICLE 15: PURCHASE RIGHTS.................................................54
15.1 First Refusal to Purchase.....................................54
15.2 Landlord's Option to Purchase the Tenant's
Personal Property; Transfer of Licenses...........55
ARTICLE 16: SUBLETTING AND ASSIGNMENT.......................................56
16.1 Subletting and Assignment.....................................56
16.2 Required Sublease Provisions..................................57
16.3 Permitted Sublease............................................58
16.4 Sublease Limitation...........................................58
ARTICLE 17: ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS..................58
17.1 Estoppel Certificates.........................................58
17.2 Financial Statements..........................................59
17.3 General Operations............................................60
ARTICLE 18: LANDLORD'S RIGHT TO INSPECT.....................................60
ARTICLE 19: LEASEHOLD MORTGAGES.............................................61
19.1 Leasehold Mortgages Authorized................................61
19.2 Notices to Landlord...........................................61
19.3 Cure by Leasehold Mortgagee...................................61
19.4 Landlord Estoppel Certificates. .............................62
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ARTICLE 20: HOTEL MORTGAGES.................................................62
20.1 Landlord May Grant Liens......................................62
20.2 Subordination of Lease........................................62
20.3 Notice to Mortgagee and Superior Landlord.....................64
ARTICLE 21: ADDITIONAL COVENANTS OF TENANT..................................64
21.1 Prompt Payment of Indebtedness................................64
21.2 Conduct of Business...........................................65
21.3 Maintenance of Accounts and Records...........................65
21.4 Notice of Litigation, Etc.....................................65
21.5 Indebtedness of Tenant........................................65
21.6 Financial Condition of Tenant.................................66
21.7 Distributions, Payments to Affiliated
Persons, Etc......................................66
21.8 Prohibited Transactions.......................................67
21.9 Liens and Encumbrances........................................67
21.10 Merger; Sale of Assets; Etc..................................67
ARTICLE 22: REPRESENTATIONS AND WARRANTIES..................................68
22.1 Representations of Tenant.....................................68
22.1.1 Status and Authority of Tenant....................68
22.1.2 Action of Tenant..................................68
22.1.3 No Violations of Agreements.......................68
22.1.4 Litigation........................................68
22.1.5 Existing Leases, Agreements, Etc..................69
22.1.6 Disclosure........................................69
22.1.7 Utilities, Etc....................................69
22.1.8 Compliance With Law...............................69
22.1.9 Hazardous Substances..............................69
22.2 Representations of Landlord...................................70
22.2.1 Status and Authority of Landlord..................70
22.2.2 Action of Landlord................................70
22.2.3 No Violations of Agreements.......................70
22.2.4 Litigation........................................70
22.3 Survival, Etc.................................................70
ARTICLE 23: MISCELLANEOUS...................................................71
23.1 Limitation on Payment of Rent.................................71
23.2 No Waiver.....................................................72
23.3 Remedies Cumulative...........................................72
23.4 Severability..................................................72
23.5 Acceptance of Surrender.......................................72
23.6 No Merger of Title............................................72
23.7 Conveyance by Landlord........................................72
23.8 Quiet Enjoyment...............................................73
23.9 Memorandum of Lease...........................................73
23.10 Notices.......................................................73
23.11 Trade Area Restriction........................................75
23.12 Construction..................................................75
23.13 Counterparts; Headings........................................75
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23.14 Applicable Law, Etc...........................................75
23.15 Special Landlord Option.......................................76
23.16 Nonrecourse. ................................................77
23.17 Confidentiality...............................................77
EXHIBITS
A - The Land
B - Approved Budget and Improvements
C - Form of Landlord Estoppel
D - Restricted Trade Area
E - Rent Allocation
LEASE AGREEMENT
THIS LEASE AGREEMENT is entered into as of this ___ day of January,
1997, by and between HPTSLC CORPORATION, a Delaware corporation, as landlord
("Landlord"), and WHC SALT LAKE CITY CORPORATION, a Delaware corporation, as
tenant ("Tenant").
W I T N E S S E T H :
WHEREAS, Landlord owns fee simple title to the Leased Property (this
and other capitalized terms used and not otherwise defined herein having the
meanings ascribed to such terms in Article 1); and
WHEREAS, Landlord wishes to lease the Leased Property to Tenant and
Tenant wishes to lease the Leased Property from Landlord, all subject to and
upon the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the mutual receipt and
legal sufficiency of which are hereby acknowledged, Landlord and Tenant hereby
agree as follows:
ARTICLE 1
DEFINITIONS
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, (i) the terms defined in this
Article shall have the meanings assigned to them in this Article and include the
plural as well as the singular, (ii) all accounting terms not otherwise defined
herein shall have the meanings assigned to them in accordance with GAAP, (iii)
all references in this Agreement to designated "Articles," "Sections" and other
subdivisions are to the designated Articles, Sections and other subdivisions of
this Agreement, and (iv) the words "herein," "hereof," "hereunder" and other
words of similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision.
1.1 "Additional Rent" shall have the meaning given such term in Section
3.1.2(a).
1.2 "Additional Charges" shall have the meaning given such term in
Section 3.1.3.
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1.3 "Affiliated Person" shall mean, with respect to any Person, (a) in
the case of any such Person which is a partnership, any partner in such
partnership, (b) in the case of any such Person which is a limited liability
company, any member of such company, (c) any other Person which is a Parent, a
Subsidiary, or a Subsidiary of a Parent with respect to such Person or to one or
more of the Persons referred to in the preceding clauses (a) and (b), (d) any
other Person who is an officer, director, trustee or employee of, or partner in
or member of, such Person or any Person referred to in the preceding clauses
(a), (b) and (c), and (e) any other Person who is a member of the Immediate
Family of such Person or of any Person referred to in the preceding clauses (a)
through (d).
1.4 "Agreement" shall mean this Lease Agreement, including Exhibits A
to D hereto, as it and they may be amended from time to time as herein provided.
1.5 "Applicable Laws" shall mean all applicable laws, statutes,
regulations, rules, ordinances, codes, licenses, permits and orders, from time
to time in existence, of all courts of competent jurisdiction and Government
Agencies, and all applicable judicial and administrative and regulatory decrees,
judgments and orders, including common law rulings and determinations, relating
to injury to, or the protection of, real or personal property or human health
(except those requirements which, by definition, are solely the responsibility
of employers) or the Environment, including, without limitation, all valid and
lawful requirements of courts and other Government Agencies pertaining to
reporting, licensing, permitting, investigation, remediation and removal of
underground improvements (including, without limitation, treatment or storage
tanks, or water, gas or oil ▇▇▇▇▇), or emissions, discharges, releases or
threatened releases of Hazardous Substances, chemical substances, pesticides,
petroleum or petroleum products, pollutants, contaminants or hazardous or toxic
substances, materials or wastes whether solid, liquid or gaseous in nature, into
the Environment, or relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous Substances,
underground improvements (including, without limitation, treatment or storage
tanks, or water, gas or oil ▇▇▇▇▇), or pollutants, contaminants or hazardous or
toxic substances, materials or wastes, whether solid, liquid or gaseous in
nature.
1.6 "Award" shall mean all compensation, sums or other value awarded,
paid or received by virtue of a total or partial Condemnation of the Leased
Property (after deduction of all reasonable legal fees and other reasonable
costs and expenses, including, without limitation, expert witness fees, incurred
by Landlord, in connection with obtaining any such award).
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1.7 "Base Total Hotel Sales" shall mean Total Hotel Sales for the Base
Year; provided, however, that in the event that, with respect to any Lease Year,
or portion thereof, for any reason (including, without limitation, a casualty or
Condemnation) there shall be, for two hundred seventy (270) days or more in any
Lease Year, a reduction in the number of rooms at the Hotel or a change in the
services provided at the Hotel (including, without limitation, closing of
restaurants or the discontinuation of food or beverage services) from the number
of rooms or the services provided during the Base Year, in determining
Additional Rent payable with respect to such Lease Year, Base Total Hotel Sales
shall be reduced as follows: (a) in the event of and for the duration of a
complete closing of the Hotel following application of any business interruption
or Award proceeds collected with respect thereto, Total Hotel Sales during the
applicable period of the Base Year throughout the period of such closing shall
be subtracted from Base Total Hotel Sales; (b) in the event of a partial closing
of the Hotel affecting any number of guest rooms in the Hotel and following
application of any business interruption or Award proceeds collected with
respect thereto, Total Hotel Sales attributable to guest room occupancy or guest
room services at the Hotel during the Base Year shall be ratably allocated among
all guest rooms in service at the Hotel during the Base Year and all such Total
Hotel Sales attributable to rooms no longer in service shall be subtracted from
Base Total Hotel Sales throughout the period of such closing; (c) in the event
of a closing of a restaurant not, simultaneously with such closing, replaced by
reasonably equivalent dining facilities and following application of any
business interruption or Award proceeds collected with respect thereto, all
Total Hotel Sales attributable to such restaurant during the Base Year shall be
subtracted from Base Total Hotel Sales throughout the period of such closing;
and (d) in the event of any other change in circumstances affecting the Hotel,
Base Total Hotel Sales shall be equitably adjusted in such manner as Landlord
and Tenant shall reasonably agree.
1.8 "Base Year" shall mean, with respect to the 1998 Fiscal Year, the
1997 calendar year and, with respect to all subsequent years, the 1998 calendar
year.
1.9 "Business Day" shall mean any day other than Saturday, Sunday, or
any other day on which banking institutions in The Commonwealth of Massachusetts
or the State of Texas are authorized by law or executive action to close.
1.10 "Capital Addition" shall mean any renovation, repair or
improvement to the Leased Property (or portion thereof), the cost of which
constitutes a Capital Expenditure.
1.11 "Capital Expenditure" shall mean any expenditure treated as
capital in nature in accordance with GAAP.
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1.12 "Claim" shall have the meaning given such term in Article 8.
1.13 "Code" shall mean the Internal Revenue Code of 1986 and, to the
extent applicable, the Treasury Regulations promulgated thereunder, each as from
time to time amended.
1.14 "Commencement Date" shall mean the date of this
Agreement.
1.15 "Condemnation" shall mean (a) the exercise of any governmental
power with respect to the Leased Property, whether by legal proceedings or
otherwise, by a Condemnor of its power of condemnation, (b) a voluntary sale or
transfer of the Leased Property by Landlord to any Condemnor, either under
threat of condemnation or while legal proceedings for condemnation are pending,
or (c) a taking or voluntary conveyance of all or part of the Leased Property,
or any interest therein, or right accruing thereto or use thereof, as the result
or in settlement of any Condemnation or other eminent domain proceeding
affecting the Leased Property, whether or not the same shall have actually been
commenced.
1.16 "Condemnor" shall mean any public or quasi-public authority, or
private corporation or Person, having the power of Condemnation.
1.17 "Consolidated Financials" shall mean, for any Fiscal Year or other
accounting period of Tenant, annual audited and quarterly unaudited financial
statements of Wyndham prepared on a consolidated basis, including Wyndham's
consolidated balance sheet and the related statements of income and cash flows,
all in reasonable detail, and setting forth in comparative form the
corresponding figures for the corresponding period in the preceding Fiscal Year,
and prepared in accordance with GAAP throughout the periods reflected.
1.18 "Date of Taking" shall mean the date the Condemnor has the right
to possession of the Leased Property, or any portion thereof, in connection with
a Condemnation.
1.19 "Default" shall mean any event or condition which with the giving
of notice and/or lapse of time may ripen into an Event of Default.
1.20 "Disbursement Rate" shall mean an annual rate of interest equal to
the greater of, as of the date of determination, (i) the Interest Rate and (ii)
the per annum rate for ten (10) year U.S. Treasury Obligations as published in
The Wall Street Journal plus three hundred fifty (350) basis points.
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1.21 "Distribution" shall mean (a) any declaration or payment of any
dividend (except dividends payable in common stock of Tenant) on or in respect
of any shares of any class of capital stock of Tenant, (b) any purchase,
redemption, retirement or other acquisition of any shares of any class of
capital stock of a corporation, (c) any other distribution on or in respect of
any shares of any class of capital stock of a corporation, or (d) any return of
capital to shareholders.
1.22 "Encumbrance" shall have the meaning given such term in Section
20.1.
1.23 "Entity" shall mean any corporation, general or limited
partnership, limited liability company or partnership, stock company or
association, joint venture, association, company, trust, bank, trust company,
land trust, business trust, cooperative, any government or agency or political
subdivision thereof or any other entity.
1.24 "Environment" shall mean soil, surface waters, ground waters,
land, stream, sediments, surface or subsurface strata and ambient air.
1.25 "Environmental Obligation" shall have the meaning given such term
in Section 4.3.1.
1.26 "Environmental Notice" shall have the meaning given such term in
Section 4.3.1.
1.27 "Event of Default" shall have the meaning given such term in
Section 12.1.
1.28 "Excess Total Hotel Sales" shall mean, with respect to any Lease
Year, or portion thereof, the amount of Total Hotel Sales for such Lease Year,
or portion thereof, in excess of Base Total Hotel Sales for the equivalent
period.
1.29 "Extended Terms" shall have the meaning given such term in Section
2.4.
1.30 "FF&E Estimate" shall have the meaning given such term in Section
5.1.2(c).
1.31 "FF&E Reserve" shall have the meaning given such term in Section
5.1.2(a).
1.32 "Financial Officer's Certificate" shall mean, as to any Person, a
certificate of the chief financial officer or chief accounting officer (or such
officers' authorized designee) of such Person, duly authorized, accompanying the
financial statements required to be delivered by such Person pursuant to Section
17.2, in which such officer shall certify (a) that such
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statements have been properly prepared in accordance with GAAP and are true,
correct and complete in all material respects and fairly present the
consolidated financial condition of such Person at and as of the dates thereof
and the results of its and their operations for the periods covered thereby, and
(b) certify that no Event of Default has occurred and is continuing hereunder.
1.33 "Fiscal Year" shall mean the calendar year.
1.34 "Fixed Term" shall have the meaning given such term in Section
2.3.
1.35 "Fixtures" shall have the meaning given such term in Section
2.1(d).
1.36 "GAAP" shall mean generally accepted accounting principles
consistently applied.
1.37 "Government Agencies" shall mean any court, agency, authority,
board (including, without limitation, environmental protection, planning and
zoning), bureau, commission, department, office or instrumentality of any nature
whatsoever of any governmental or quasi-governmental unit of the United States
or the State or any county or any political subdivision of any of the foregoing,
whether now or hereafter in existence, having jurisdiction over Tenant or the
Leased Property or any portion thereof or the Hotel operated thereon.
1.38 "Hazardous Substances" shall mean any substance:
(a) the presence of which requires or may hereafter require
notification, investigation or remediation under any federal, state or
local statute, regulation, rule, ordinance, order, action or policy; or
(b) which is or becomes defined as a "hazardous waste",
"hazardous material" or "hazardous substance" or "pollutant" or
"contaminant" under any present or future federal, state or local
statute, regulation, rule or ordinance or amendments thereto including,
without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. et seq.) and the Resource
Conservation and Recovery Act (42 U.S.C. section 6901 et seq.) and the
regulations promulgated thereunder; or
(c) which is toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise hazardous
and is or becomes regulated by any governmental authority, agency,
department, commission, board, agency or instrumentality of the United
States, any
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state of the United States, or any political subdivision
thereof; or
(d) the presence of which on the Leased Property causes or
materially threatens to cause an unlawful nuisance upon the Leased
Property or to adjacent properties or poses or materially threatens to
pose a hazard to the Leased Property or to the health or safety of
persons on or about the Leased Property; or
(e) without limitation, which contains gasoline, diesel fuel
or other petroleum hydrocarbons or volatile organic compounds; or
(f) without limitation, which contains polychlorinated
biphenyls (PCBs) or asbestos or urea formaldehyde foam insulation; or
(g) without limitation, which contains or emits radioactive
particles, waves or material; or
(h) without limitation, constitutes materials which are now or
may hereafter be subject to regulation pursuant to the Material Waste
Tracking Act of 1988, or any Applicable Laws promulgated by any
Government Agencies.
1.39 "Hotel" shall mean the hotel to be operated on the Leased Property
as a full-service Wyndham Hotel as of the Commencement Date.
1.40 "Hotel Mortgage" shall mean any Encumbrance placed upon the Leased
Property in accordance with Article 20.
1.41 "Hotel Mortgagee" shall mean the holder of any Hotel Mortgage.
1.42 "Immediate Family" shall mean, with respect to any individual,
such individual's spouse, parents, brothers, sisters, children (natural or
adopted), stepchildren, grandchildren, grandparents, parents-in-law,
brothers-in-law, sisters-in-law, nephews and nieces.
1.43 "Impositions" shall mean collectively, all taxes (including,
without limitation, all taxes imposed under the laws of the State, as such laws
may be amended from time to time, and all ad valorem, sales and use, or similar
taxes as the same relate to or are imposed upon Landlord, Tenant or the business
conducted upon the Leased Property), assessments (including, without limitation,
all assessments for public improvements or benefit, whether or not commenced or
completed prior to the date hereof), water, sewer or other rents and charges,
excises, tax levies, fees (including, without limitation, license, permit,
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inspection, authorization and similar fees), and all other governmental charges,
in each case whether general or special, ordinary or extraordinary, or foreseen
or unforeseen, of every character in respect of the Leased Property or the
business conducted thereon by Tenant (including all interest and penalties
thereon due to any failure in payment by Tenant), which at any time prior to,
during or in respect of the Term hereof may be assessed or imposed on or in
respect of or be a lien upon (a) Landlord's interest in the Leased Property, (b)
the Leased Property or any part thereof or any rent therefrom or any estate,
right, title or interest therein, or (c) any occupancy, operation, use or
possession of, or sales from, or activity conducted on, or in connection with
the Leased Property or the leasing or use of the Leased Property or any part
thereof by Tenant; provided, however, that nothing contained herein shall be
construed to require Tenant to pay (i) any tax based on net income imposed on
Landlord, (ii) any net revenue tax of Landlord, (iii) any transfer fee or other
tax imposed with respect to the sale, exchange or other disposition by Landlord
of the Leased Property or the proceeds thereof, (iv) any single business, gross
receipts tax, transaction privilege, rent or similar taxes as the same relate to
or are imposed upon Landlord, (v) any interest or penalties imposed on Landlord
as a result of the failure of Landlord to file any return or report timely and
in the form prescribed by law or to pay any tax or imposition, except to the
extent such failure is a result of a breach by Tenant of its obligations
pursuant to Section 3.1.3, (vi) any Impositions imposed on Landlord that are a
result of Landlord not being considered a "United States person" as defined in
Section 7701(a)(30) of the Code, (vii) any Impositions that are enacted or
adopted by their express terms as a substitute for any tax that would not have
been payable by Tenant pursuant to the terms of this Agreement or (viii) any
Impositions imposed as a result of a breach of covenant or representation by
Landlord in any agreement governing Landlord's conduct or operation or as a
result of the gross negligence or willful misconduct of Landlord.
1.44 "Incidental Documents" shall mean the Pledge and Security
Agreement, the Stock Pledge Agreement and the Limited Guaranty.
1.45 "Indebtedness" shall mean all obligations, contingent or
otherwise, which in accordance with GAAP should be reflected on the obligor's
balance sheet as liabilities.
1.46 "Insurance Requirements" shall mean all terms of any insurance
policy required by this Agreement and all requirements of the issuer of any such
policy and all orders, rules and regulations and any other requirements of the
National Board of Fire Underwriters (or any other body exercising similar
functions) binding upon Landlord, Tenant or the Leased Property.
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1.47 "Interest Rate" shall mean ten percent (10%) per annum.
1.48 "Land" shall have the meaning given such term in Section 2.1(a).
1.49 "Landlord" shall have the meaning given such term in the preambles
to this Agreement and shall also include its permitted successors and assigns.
1.50 "Landlord Liens" shall mean liens on or against the Leased
Property or any payment of Rent (a) which result from any act of, or any claim
against, Landlord or any owner of a direct or indirect interest in the Leased
Property, or which result from any violation by Landlord of any terms of this
Agreement or the Purchase Agreement, or (b) which result from liens in favor of
any taxing authority by reason of any tax owed by Landlord or any fee owner of a
direct or indirect interest in the Leased Property; provided, however, that
"Landlord Lien" shall not include any lien resulting from any tax for which
Tenant is obligated to pay or indemnify Landlord against until such time as
Tenant shall have already paid to or on behalf of Landlord the tax or the
required indemnity with respect to the same.
1.51 "Lease Year" shall mean any Fiscal Year or portion thereof,
commencing with the 1997 Fiscal Year, during the Term.
1.52 "Leased Improvements" shall have the meaning given such term in
Section 2.1(b).
1.53 "Leased Intangible Property" shall mean all hotel licensing
agreements and other service contracts, equipment leases, booking agreements and
other arrangements or agreements affecting the ownership, repair, maintenance,
management, leasing or operation of the Leased Property to which Landlord is a
party; all books, records and files relating to the leasing, maintenance,
management or operation of the Leased Property belonging to Landlord; all
transferable or assignable permits, certificates of occupancy, operating
permits, sign permits, development rights and approvals, certificates, licenses,
warranties and guarantees, rights to deposits, trade names, service marks,
telephone exchange numbers identified with the Leased Property, and all other
transferable intangible property, miscellaneous rights, benefits and privileges
of any kind or character belonging to Landlord with respect to the Leased
Property.
1.54 "Leased Personal Property" shall have the meaning given such term
in Section 2.1(e).
1.55 "Leased Property" shall have the meaning given such term in
Section 2.1.
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1.56 "Leasehold Mortgage" shall mean a mortgage, a deed to secure debt,
or other security instrument by which the leasehold estate or any other rights
of Tenant (including, without limitation, rights created by this Agreement) is
mortgaged, conveyed, assigned, or otherwise transferred by Tenant, to secure a
loan or loans obtained, or obligations incurred or guaranteed, by Tenant to a
Lending Institution.
1.57 "Leasehold Mortgagee" shall mean the holder of any Leasehold
Mortgage.
1.58 "Legal Requirements" shall mean all federal, state, county,
municipal and other governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions affecting the Leased Property or
the maintenance, construction, alteration or operation thereof, whether now or
hereafter enacted or in existence, including, without limitation, (a) all
permits, licenses, authorizations, certificates and regulations necessary to
operate the Leased Property for its Permitted Use, and (b) all covenants,
agreements, restrictions and encumbrances contained in any instruments at any
time in force affecting the Leased Property, including those which may (i)
require material repairs, modifications or alterations in or to the Leased
Property or (ii) in any way materially and adversely affect the use and
enjoyment thereof, but excluding any requirements arising as a result of
Landlord's status as a real estate investment trust.
1.59 "Lending Institution" shall mean any United States insurance
company, banking corporation, federally insured commercial or savings bank,
national banking association, United States savings and loan association,
employees' welfare, pension or retirement fund or system, corporate profit
sharing or pension trust, college or university, or real estate investment
trust, including any corporation qualified to be treated for federal tax
purposes as a real estate investment trust, such trust having a net worth of at
least $100,000,000 and shall also mean and include Bankers Trust Company and any
Person participating in a loan syndicate with Bankers Trust Company.
1.60 "Lien" shall mean any mortgage, security interest, pledge,
collateral assignment, or other encumbrance, lien or charge of any kind, or any
transfer of property or assets for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors.
1.61 "Limited Guaranty" shall mean the Limited Guaranty Agreement,
dated as of the date hereof, made by Wyndham for the benefit of Landlord.
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1.62 "Management Agreement" shall mean the Management Agreement, dated
the date hereof, between Tenant and Wyndham, together with all amendments,
modifications and supplements thereto.
1.63 "Manager" shall mean Wyndham Management Corporation, a Delaware
corporation, and its permitted successors and assigns.
1.64 "Minimum Rent" shall mean, with respect to each calendar year, the
sum of Four Million Four Hundred Thousand and Four Dollars ($4,400,004),
allocated as set forth in Exhibit E.
1.65 "Notice" shall mean a notice given in accordance with Section
22.10.
1.66 "Officer's Certificate" shall mean a certificate signed by an
officer of the certifying Entity duly authorized by the board of directors of
the certifying Entity.
1.67 "Overdue Rate" shall mean, on any date, a per annum rate of
interest equal to the lesser of fifteen percent (15%) and the maximum rate then
permitted under applicable law.
1.68 "Parent" shall mean, with respect to any Person, any Person which
owns directly, or indirectly through one or more Subsidiaries or Affiliated
Persons, five percent (5%) or more of the voting or beneficial interest in, or
otherwise has the right or power (whether by contract, through ownership of
securities or otherwise) to control, such Person.
1.69 "Permitted Encumbrances" shall mean all rights, restrictions, and
easements of record set forth on Schedule B to the owner's title insurance
policy issued to Landlord on the date hereof, plus any other such encumbrances
as may have been consented to in writing by Landlord from time to time.
1.70 "Permitted Liens" shall mean any Liens granted in accordance with
Section 21.9(a).
1.71 "Permitted Use" shall mean any use of the Leased Property
permitted pursuant to Section 4.1.1.
1.72 "Person" shall mean any individual or Entity, and the heirs,
executors, administrators, legal representatives, successors and assigns of such
Person where the context so admits.
1.73 "Pledge and Security Agreement" shall mean the Pledge and Security
Agreement, dated as of the date hereof, made by Tenant for the benefit of
Landlord.
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1.74 "Records" shall have the meaning given such term in Section 7.2.
1.75 "Rent" shall mean, collectively, the Minimum Rent, Additional Rent
and Additional Charges.
1.76 "SEC" shall mean the Securities and Exchange Commission.
1.77 "Security Deposit" shall mean a cash amount equal to Four Million
Seven Hundred Twenty-Five Thousand Dollars ($4,725,000).
1.78 "State" shall mean the State of Utah.
1.79 "Stock Pledge Agreement" shall mean the Stock Pledge Agreement,
dated as of the date hereof, made by Wyndham to Landlord with respect to the
stock of Tenant.
1.80 "Subordinated Creditor" shall mean any creditor of Tenant which is
a party to a Subordination Agreement in favor of Landlord.
1.81 "Subordination Agreement" shall mean any agreement executed by a
Subordinated Creditor pursuant to which the payment and performance of Tenant's
obligations to such Subordinated Creditor are subordinated to the payment and
performance of Tenant's obligations to Landlord under this Agreement.
1.82 "Subsidiary" shall mean, with respect to any Person, any Entity
(a) in which such Person owns directly, or indirectly through one or more
Subsidiaries, forty-nine percent (49%) or more of the voting or beneficial
interest or (b) which such Person otherwise has the right or power to control
(whether by contract, through ownership of securities or otherwise).
1.83 "Successor Landlord" shall have the meaning given such term in
Section 20.2.
1.84 "Tangible Net Worth" shall mean the excess of total assets over
total liabilities, total assets and total liabilities each to be determined in
accordance with GAAP, excluding, however, from the determination of total
assets: (a) goodwill, organizational expenses, research and development
expenses, trademarks, trade names, copyrights, patents, patent applications,
licenses and rights in any thereof, and other similar intangibles; (b) all
deferred charges or unamortized debt discount and expense; (c) all reserves
carried and not deducted from assets; (d) treasury stock and capital stock,
obligations or other securities of, or capital contributions to, or investments
in, any Subsidiary; (e) securities which are not readily marketable; (f) any
write-up in the book value of any asset
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resulting from a revaluation thereof subsequent to the Commencement Date; (g)
deferred gain; and (h) any items not included in clauses (a) through (g) above
that are treated as intangibles in conformity with GAAP; and excluding, however,
from the determination of total liabilities deferred fees payable to the Manager
in accordance with the Management Agreement.
1.85 "Tenant" shall have the meaning given such term in the preambles
to this Agreement and shall also include its permitted successors and assigns.
1.86 "Tenant's Personal Property" shall mean all motor vehicles and
consumable inventory and supplies, furniture, furnishings, movable walls and
partitions, equipment and machinery and all other tangible personal property of
Tenant, if any, acquired by Tenant on and after the date hereof and located at
the Leased Property or used in Tenant's business at the Leased Property and all
modifications, replacements, alterations and additions to such personal property
installed at the expense of Tenant, other than any items included within the
definition of Fixtures or Leased Personal Property.
1.87 "Term" shall mean, collectively, the Fixed Term and the Extended
Terms, to the extent properly exercised pursuant to the provisions of Section
2.4, unless sooner terminated pursuant to the provisions of this Agreement.
1.88 "Total Hotel Sales" shall mean, for each Fiscal Year during the
Term, all revenues and receipts of every kind derived by Tenant from operating
the Leased Property and parts thereof, including, but not limited to: income
(from both cash and credit transactions), after deductions for bad debts, and
discounts for prompt or cash payments and refunds, from rental of rooms, stores,
offices, meeting, exhibit or sales space of every kind; license, lease and
concession fees and rentals (not including gross receipts of licensees, lessees
and concessionaires); income from vending machines; health club membership fees;
food and beverage sales; wholesale and retail sales of merchandise (other than
proceeds from the sale of furnishings, fixture and equipment no longer necessary
to the operation of the Hotel, which shall be deposited in the FF&E Reserve);
service charges, to the extent not distributed to the employees at the Hotel as
gratuities; and proceeds, if any, from business interruption or other loss of
income insurance; provided, however, that Total Hotel Sales shall not include
the following: gratuities to Hotel employees; federal, state or municipal
excise, sales, use or similar taxes collected directly from patrons or guests or
included as part of the sales price of any goods or services; insurance proceeds
(other than proceeds from business interruption or other loss of income
insurance); Award proceeds (other than for a temporary Condemnation); any
proceeds from any sale of the Leased Property or from the refinancing of any
debt encumbering the Leased
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Property; proceeds from the disposition of furnishings, fixture and equipment no
longer necessary for the operation of the Hotel; interest which accrues on
amounts deposited in the FF&E Reserve; and recoveries against predecessors in
title to the extent such recoveries are compensation attributable to items not
otherwise includable in the calculation of Total Hotel Sales.
1.89 "Uniform System of Accounts" shall mean A Uniform System of
Accounts for Hotels, Eighth Revised Edition, 1986, as published by the Hotel
Association of New York City, as the same
may be further revised from time to time.
1.90 "Unsuitable for Its Permitted Use" shall mean a state or condition
of the Hotel such that (a) following any damage or destruction involving the
Hotel, the Hotel cannot be operated in the good faith judgment of Tenant on a
commercially practicable basis for its Permitted Use and it cannot reasonably be
expected to be restored to substantially the same condition as existed
immediately before such damage or destruction, and as otherwise required by
Section 10.2.4, within twelve (12) months following such damage or destruction
or such shorter period of time as to which business interruption insurance is
available to cover Rent and other costs related to the Leased Property following
such damage or destruction, or (b) as the result of a partial taking by
Condemnation, the Hotel cannot be operated, in the good faith judgment of Tenant
or the Manager on a commercially practicable basis for its Permitted Use.
1.91 "Work" shall have the meaning given such term in Section 10.2.4.
1.92 "Wyndham" shall mean Wyndham Hotel Corporation, a Delaware
corporation.
ARTICLE 2
LEASED PROPERTY AND TERM
2.1 Leased Property. Upon and subject to the terms and conditions
hereinafter set forth, Landlord leases to Tenant and Tenant leases from Landlord
all of Landlord's right, title and interest in and to all of the following
(collectively, the "Leased Property"):
(a) those certain tracts, pieces and parcels of land, as more
particularly described in Exhibit A, attached hereto and made a part
hereof (the "Land");
(b) all buildings, structures and other improvements of every
kind including, but not limited to, alleyways and connecting tunnels,
sidewalks, utility pipes, conduits and lines (on-site and off-site),
parking areas and roadways appurtenant to such buildings and structures
presently
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situated upon the Land (collectively, the "Leased Improvements");
(c) all easements, rights and appurtenances relating to the
Land and the Leased Improvements;
(d) all equipment, machinery, fixtures, and other items of
property, now or hereafter permanently affixed to or incorporated into
the Leased Improvements, including, without limitation, all furnaces,
boilers, heaters, electrical equipment, heating, plumbing, lighting,
ventilating, refrigerating, incineration, air and water pollution
control, waste disposal, air-cooling and air-conditioning systems and
apparatus, sprinkler systems and fire and theft protection equipment,
all of which, to the maximum extent permitted by law, are hereby deemed
by the parties hereto to constitute real estate, together with all
replacements, modifications, alterations and additions thereto, but
specifically excluding all items included within the category of
Tenant's Personal Property (collectively, the "Fixtures");
(e) all machinery, equipment, furniture, furnishings, moveable
walls or partitions, computers or trade fixtures or other personal
property of any kind or description used or useful in Tenant's business
on or in the Leased Improvements, and located on or in the Leased
Improvements, and all modifications, replacements, alterations and
additions to such personal property, except items, if any, included
within the category of Fixtures, but specifically excluding all items
included within the category of Tenant's Personal Property
(collectively, the "Leased Personal Property");
(f) all of the Leased Intangible Property; and
(g) any and all leases of space (including any security
deposits held by Tenant or the Manager pursuant thereto) in the Leased
Improvements to tenants thereof.
2.2 Condition of Leased Property. Tenant acknowledges receipt and
delivery of possession of the Leased Property and Tenant accepts the Leased
Property in its "as is" condition, subject to the rights of parties in
possession, the existing state of title, including all covenants, conditions,
restrictions, reservations, mineral leases, easements and other matters of
record or that are visible or apparent on the Leased Property, all applicable
Legal Requirements, the lien of any financing instruments, mortgages and deeds
of trust existing prior to the Commencement Date or permitted by the terms of
this Agreement, and such other matters which would be disclosed by an inspection
of the Leased Property and the record title thereto or
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by an accurate survey thereof. TENANT REPRESENTS THAT IT HAS INSPECTED THE
LEASED PROPERTY AND ALL OF THE FOREGOING AND HAS FOUND THE CONDITION THEREOF
SATISFACTORY AND IS NOT RELYING ON ANY REPRESENTATION OR WARRANTY OF LANDLORD OR
LANDLORD'S AGENTS OR EMPLOYEES WITH RESPECT THERETO AND TENANT WAIVES ANY CLAIM
OR ACTION AGAINST LANDLORD IN RESPECT OF THE CONDITION OF THE LEASED PROPERTY.
LANDLORD MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, IN RESPECT OF
THE LEASED PROPERTY OR ANY PART THEREOF, EITHER AS TO ITS FITNESS FOR USE,
DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE OR OTHERWISE, AS TO THE
QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, LATENT OR PATENT, IT BEING
AGREED THAT ALL SUCH RISKS ARE TO BE BORNE BY TENANT. To the maximum extent
permitted by law, however, Landlord hereby assigns to Tenant all of Landlord's
rights to proceed against any predecessor in title for breaches of warranties or
representations or for latent defects in the Leased Property. Landlord shall
fully cooperate with Tenant in the prosecution of any such claims, in Landlord's
or Tenant's name, all at Tenant's sole cost and expense. Tenant shall indemnify,
defend, and hold harmless Landlord from and against any loss, cost, damage or
liability (including reasonable attorneys' fees) incurred by Landlord in
connection with such cooperation.
2.3 Fixed Term. The initial term of this Agreement (the "Fixed Term")
shall commence on the Commencement Date and shall expire December 31, 2012.
2.4 Extended Term. Provided that no Event of Default shall have
occurred and be continuing, this Agreement shall be in full force and effect,
the Term shall be automatically extended for four (4) consecutive renewal terms
of twelve (12) years each (collectively, the "Extended Terms"), unless Tenant
shall give Landlord Notice, not later than two (2) years prior to the scheduled
expiration of the then current Term of this Agreement (Fixed or Extended, as the
case may be), that Tenant elects not so to extend the term of this Agreement
(and time shall be of the essence with respect to the giving of such Notice).
Each Extended Term shall commence on the day succeeding the expiration
of the Fixed Term or the preceding Extended Term, as the case may be. All of the
terms, covenants and provisions of this Agreement shall apply to each such
Extended Term, except that Tenant shall have no right to extend the Term beyond
the expiration of the Extended Terms. If Tenant shall give Notice that it elects
not to extend the Term in accordance with this Section 2.4, this Agreement shall
automatically terminate at the end of the Term then in effect and Tenant shall
have no further option to extend the Term of this Agreement. Otherwise, the
extension of this Agreement shall be automatically effected without the
execution of any additional documents; it being understood and agreed, however,
that Tenant and Landlord shall
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execute such documents and agreements as either party shall reasonably require
to evidence the same.
ARTICLE 3
RENT
3.1 Rent. Tenant shall pay, in lawful money of the United States of
America which shall be legal tender for the payment of public and private debts,
without offset, abatement, demand or deduction (unless otherwise expressly
provided in this Agreement), Minimum Rent and Additional Rent to Landlord and
Additional Charges to the party to whom such Additional Charges are payable,
during the Term. All payments to Landlord shall be made by wire transfer of
immediately available federal funds or by other means acceptable to Landlord in
its sole discretion. Rent for any partial Accounting Period shall be prorated on
a per diem basis.
3.1.1 Minimum Rent.
(a) Minimum Rent shall be paid in advance on the first
Business Day of each month; provided, however, that the first payment
of Minimum Rent shall be payable on the Commencement Date (and, if
applicable, such payment shall be prorated as provided in the last
sentence of the first paragraph of Section 3.1).
(b) Adjustments of Minimum Rent Following Disbursements Under
Sections 5.1.3(b), 10.2.4 or 11.2. Effective on the date of each
disbursement to pay for the cost of any repairs, maintenance,
renovations or replacements pursuant to Sections 5.1.3(b), 10.2.4 or
11.2, the Minimum Rent shall be increased by a per annum amount equal
to the Disbursement Rate times the amount so disbursed. If any such
disbursement is made during any month on a day other than the first day
of a month, Tenant shall pay to Landlord on the first day of the
immediately following month (in addition to the amount of Minimum Rent
payable with respect to such month, as adjusted pursuant to this
paragraph (b)) the amount by which Minimum Rent for the preceding
month, as adjusted for such disbursement on a per diem basis, exceeded
the amount of Minimum Rent paid by Tenant for such preceding month.
(c) Adjustments of Minimum Rent Following Disbursements Under
Section 6.2. Effective on the date of each disbursement to pay for the
cost of any repairs, maintenance, renovations or replacements pursuant
to Section 6.2, the Minimum Rent shall be increased by a per annum
amount equal to the Interest Rate times the amount so
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disbursed. If any such disbursement is made during any month on a day
other than the first day of a month, Tenant shall pay to Landlord on
the first day of the immediately following month (in addition to the
amount of Minimum Rent payable with respect to such month, as adjusted
pursuant to this paragraph (c)) the amount by which Minimum Rent for
the preceding month, as adjusted for such disbursement on a per diem
basis, exceeded the amount of Minimum Rent paid by Tenant for such
preceding month.
(d) Credits Against Minimum Rent. On the date on which Minimum
Rent is payable pursuant to this Agreement, Landlord shall credit
against the Minimum Rent then due accrued interest on the Guaranty
Deposit (as defined therein) pursuant to the Guaranty.
3.1.2 Additional Rent.
(a) Amount. Commencing with the Second Lease Year, for each
Lease Year or portion thereof, Tenant shall pay an aggregate amount of
additional rent ("Additional Rent") with respect to such Lease Year,
pursuant to this Agreement, in an amount, not less than zero, equal to
five percent (5%) of Excess Total Hotel Sales for the second Lease Year
and (y) eight percent (8%) of Excess Total Hotel Sales for the third
Lease Year and each Lease Year thereafter.
(b) Monthly Installments. Commencing with the Second Lease
Year, installments of Additional Rent for each Lease Year or portion
thereof shall be calculated and paid monthly in arrears, together with
an Officer's Certificate setting forth the calculation of Additional
Rent due and payable for such month.
(c) Reconciliation of Additional Rent. In addition, on or
before April 30, of each year, commencing April 30, 1998, Tenant shall
deliver to Landlord an Officer's Certificate setting forth the Total
Hotel Sales for the Leased Property for such preceding Lease Year,
together with an audit of Tenant's revenues for the preceding Lease
Year, conducted by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and Co., or another "Big Six",
so-called, firm of independent certified public accountants proposed by
Tenant and approved by Landlord (which approval shall not be
unreasonably withheld or delayed).
If the annual Additional Rent for such preceding Lease Year as shown in
the Officer's Certificate exceeds the amount previously paid with respect
thereto by Tenant, Tenant shall pay such excess to Landlord at such time as the
Officer's Certificate is delivered, together with interest at the Interest Rate,
which interest shall accrue from the close of such preceding Lease Year until
the date that such certificate is required to be delivered
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and, thereafter, such interest shall accrue at the Overdue Rate, until the
amount of such difference shall be paid or otherwise discharged. If the annual
Additional Rent for such preceding Lease Year as shown in the Officer's
Certificate is less than the amount previously paid with respect thereto by
Tenant, provided that no Event of Default shall have occurred and be continuing,
Landlord shall grant Tenant a credit against the Rent next coming due in the
amount of such difference, together with interest at the Interest Rate, which
interest shall accrue from the date of payment by Tenant until the date such
credit is applied or paid, as the case may be. If such credit cannot be made
because the Term has expired prior to application in full thereof, provided no
Event of Default has occurred and is continuing, Landlord shall pay the
unapplied balance of such credit to Tenant, together with interest at the
Interest Rate, which interest shall accrue from the date of payment by Tenant
until the date of payment by Landlord.
(d) Confirmation of Additional Rent. Tenant shall utilize, or
cause to be utilized, an accounting system for the Leased Property in
accordance with its usual and customary practices and in accordance
with GAAP, which will accurately record all Total Hotel Sales and
Tenant shall retain, for at least three (3) years after the expiration
of each Lease Year, reasonably adequate records conforming to such
accounting system showing all Total Hotel Sales for such Lease Year.
Landlord, at its own expense, except as provided hereinbelow, shall
have the right, exercisable by Notice to Tenant within one (1) year
after receipt of the applicable Officer's Certificate, by its
accountants or representatives to audit the information set forth in
the Officer's Certificate referred to in subparagraph (c) above and, in
connection with such audits, to examine Tenant's and the Manager's
books and records with respect thereto (including supporting data and
sales and excise tax returns). If any such audit discloses a deficiency
in the payment of Additional Rent and, either Tenant agrees with the
result of such audit or the matter is otherwise compromised with
Landlord, Tenant shall forthwith pay to Landlord the amount of the
deficiency, as finally agreed or determined, together with interest at
the Interest Rate, from the date such payment should have been made to
the date of payment thereof. If such deficiency, as agreed upon or
compromised as aforesaid, is more than four percent (4%) of the Total
Hotel Sales reported by Tenant for such Lease Year and, as a result,
Landlord did not receive at least ninety-five percent (95%) of the
Additional Rent payable with respect to such Lease Year, Tenant shall
pay the reasonable cost of such audit and examination. If any such
audit discloses that Tenant paid more Additional Rent for any Lease
Year than was due hereunder, and either Landlord agrees with the result
of such audit or the matter is
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otherwise determined, provided no Event of Default has occurred and is
continuing, Landlord shall grant Tenant a credit equal to the amount of
such overpayment against the Rent next coming due in the amount of such
difference, as finally agreed or determined, together with interest at
the Interest Rate, which interest shall accrue from the time of payment
by Tenant until the date such credit is applied or paid, as the case
may be. If such a credit cannot be made because the Term has expired
before the credit can be applied in full, provided no Event of Default
has occurred and is continuing, Landlord shall pay the unapplied
balance of such credit to Tenant, together with interest at the
Interest Rate, which interest shall accrue from the date of payment by
Tenant until the date of payment from Landlord.
Any proprietary information obtained by Landlord with respect to Tenant
pursuant to the provisions of this Agreement shall be treated as confidential,
except that such information may be used, subject to appropriate confidentiality
safeguards, in any litigation between the parties and except further that
Landlord may disclose such information to its prospective lenders, provided that
Landlord shall direct and obtain the agreement of such lenders to maintain such
information as confidential. The obligations of Tenant and Landlord contained in
this Section 3.1.2 shall survive the expiration or earlier termination of this
Agreement.
3.1.3 Additional Charges. In addition to the Minimum Rent and
Additional Rent payable hereunder, Tenant shall pay to the appropriate parties
and discharge as and when due and payable the following (collectively,
"Additional Charges"):
(a) Impositions. Subject to Article 8 relating to permitted
contests, Tenant shall pay, or cause to be paid, all Impositions before
any fine, penalty, interest or cost (other than any opportunity cost as
a result of a failure to take advantage of any discount for early
payment) may be added for non-payment, such payments to be made
directly to the taxing authorities where feasible, and shall promptly,
upon request, furnish to Landlord copies of official receipts or other
reasonably satisfactory proof evidencing such payments. If any such
Imposition may, at the option of the taxpayer, lawfully be paid in
installments (whether or not interest shall accrue on the unpaid
balance of such Imposition), Tenant may exercise the option to pay the
same (and any accrued interest on the unpaid balance of such
Imposition) in installments and, in such event, shall pay such
installments during the Term as the same become due and before any
fine, penalty, premium, further interest or cost may be added thereto.
Landlord, at its expense, shall, to the extent required or permitted by
Applicable Law, prepare and file all tax returns and pay all taxes due
in respect of
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Landlord's net income, gross receipts, sales and use, single business,
transaction privilege, rent, ad valorem, franchise taxes and taxes on
its capital stock, and Tenant, at its expense, shall, to the extent
required or permitted by Applicable Laws and regulations, prepare and
file all other tax returns and reports in respect of any Imposition as
may be required by Government Agencies. Provided no Event of Default
shall have occurred and be continuing, if any refund shall be due from
any taxing authority in respect of any Imposition paid by Tenant, the
same shall be paid over to or retained by Tenant. Landlord and Tenant
shall, upon request of the other, provide such data as is maintained by
the party to whom the request is made with respect to the Leased
Property as may be necessary to prepare any required returns and
reports. In the event Government Agencies classify any property covered
by this Agreement as personal property, Tenant shall file all personal
property tax returns in such jurisdictions where it may legally so
file. Each party shall, to the extent it possesses the same, provide
the other, upon request, with cost and depreciation records necessary
for filing returns for any property so classified as personal property.
Where Landlord is legally required to file personal property tax
returns for property covered by this Agreement, Landlord shall provide
Tenant with copies of assessment notices in sufficient time for Tenant
to file a protest. All Impositions assessed against such personal
property shall be (irrespective of whether Landlord or Tenant shall
file the relevant return) paid by Tenant not later than the last date
on which the same may be made without interest or penalty.
Landlord shall give prompt Notice to Tenant of all Impositions
payable by Tenant hereunder of which Landlord at any time has
knowledge; provided, however, that Landlord's failure to give any such
notice shall in no way diminish Tenant's obligation hereunder to pay
such Impositions, unless such failure continues for more than twelve
(12) months after the date Landlord learned of such Imposition.
(b) Utility Charges. Tenant shall pay or cause to be paid all
charges for electricity, power, gas, oil, water and other utilities
used in connection with the Leased Property.
(c) Insurance Premiums. Tenant shall pay or cause to be paid
all premiums for the insurance coverage required to be maintained
pursuant to Article 9.
(d) Other Charges. Tenant shall pay or cause to be paid all
other amounts, liabilities and obligations with respect to the Leased
Property and this Agreement, including, without limitation, all amounts
payable under any
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equipment leases and all agreements to indemnify Landlord under
Sections 4.3.2 and 9.7.
(e) Reimbursement for Additional Charges. If Tenant pays or
causes to be paid property taxes or similar or other Additional Charges
attributable to periods after the end of the Term, whether upon
expiration or sooner termination of this Agreement (other than
termination by reason of an Event of Default), Tenant may, within a
reasonable time after the end of the Term, provide Notice to Landlord
of its estimate of such amounts. Landlord shall promptly reimburse
Tenant for all payments of such taxes and other similar Additional
Charges that are attributable to any period after the Term of this
Agreement.
3.2 Late Payment of Rent, Etc. If any installment of Minimum Rent,
Additional Rent or Additional Charges (but only as to those Additional Charges
which are payable directly to Landlord) shall not be paid within ten (10) days
after its due date, Tenant shall pay Landlord, on demand, as Additional Charges,
a late charge (to the extent permitted by law) computed at the Overdue Rate on
the amount of such installment, from the due date of such installment to the
date of payment thereof. To the extent that Tenant pays any Additional Charges
directly to Landlord or any Hotel Mortgagee pursuant to any requirement of this
Agreement, Tenant shall be relieved of its obligation to pay such Additional
Charges to the Entity to which they would otherwise be due. If any payments due
from Landlord to Tenant shall not be paid within ten (10) days after its due
date, Landlord shall pay to Tenant, on demand, a late charge (to the extent
permitted by law) computed at the Overdue Rate on the amount of such installment
from the due date of such installment to the date of payment thereof.
In the event of any failure by Tenant to pay any Additional Charges
when due, Tenant shall promptly pay and discharge, as Additional Charges, every
fine, penalty, interest and cost which is added for non-payment or late payment
of such items. Landlord shall have all legal, equitable and contractual rights,
powers and remedies provided either in this Agreement or by statute or otherwise
in the case of non-payment of the Additional Charges as in the case of
non-payment of the Minimum Rent and Additional Rent.
3.3 Net Lease. The Rent shall be absolutely net to Landlord so that
this Agreement shall yield to Landlord the full amount of the installments or
amounts of the Rent throughout the Term, subject to any other provisions of this
Agreement which expressly provide otherwise, including those provisions for
adjustment or abatement of such Rent.
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3.4 No Termination, Abatement, Etc. Except as otherwise specifically
provided in this Agreement, each of Landlord and Tenant, to the maximum extent
permitted by law, shall remain bound by this Agreement in accordance with its
terms and shall not take any action without the consent of the other to modify,
surrender or terminate this Agreement. In addition, except as otherwise
expressly provided in this Agreement, Tenant shall not seek, or be entitled to,
any abatement, deduction, deferment or reduction of the Rent, or set-off against
the Rent, nor shall the respective obligations of Landlord and Tenant be
otherwise affected by reason of (a) any damage to or destruction of the Leased
Property or any portion thereof from whatever cause or any Condemnation, (b) the
lawful or unlawful prohibition of, or restriction upon, Tenant's use of the
Leased Property, or any portion thereof, or the interference with such use by
any Person or by reason of eviction by paramount title; (c) any claim which
Tenant may have against Landlord by reason of any default (other than a monetary
default) or breach of any warranty by Landlord under this Agreement or any other
agreement between Landlord and Tenant, or to which Landlord and Tenant are
parties; (d) any bankruptcy, insolvency, reorganization, composition,
readjustment, liquidation, dissolution, winding up or other proceedings
affecting Landlord or any assignee or transferee of Landlord; or (e) for any
other cause whether similar or dissimilar to any of the foregoing (other than a
monetary default by Landlord); provided, however, that the foregoing shall not
apply or be construed to restrict Tenant's rights in the event of any act or
omission by Landlord constituting gross negligence or willful misconduct. Except
as otherwise specifically provided in this Agreement, Tenant hereby waives all
rights arising from any occurrence whatsoever, which may now or hereafter be
conferred upon it by law (a) to modify, surrender or terminate this Agreement or
quit or surrender the Leased Property or any portion thereof, or (b) which would
entitle Tenant to any abatement, reduction, suspension or deferment of the Rent
or other sums payable or other obligations to be performed by Tenant hereunder.
The obligations of each party hereunder shall be separate and independent
covenants and agreements, and the Rent and all other sums payable by Tenant
hereunder shall continue to be payable in all events unless the obligations to
pay the same shall be terminated pursuant to the express provisions of this
Agreement. In any instance where, after the occurrence of an Event of Default,
Landlord retains funds which, but for the occurrence of such Event of Default,
would be payable to Tenant, Landlord shall refund such funds to Tenant to the
extent the amount thereof exceeds the amount necessary to compensate Landlord
for any cost, loss or damage incurred in connection with such Event of Default.
3.5 Security Deposit. Upon execution of this Agreement, Tenant shall
deposit with Landlord the Security Deposit. The Security Deposit shall be held
by Landlord as security for the faithful observance and performance by Tenant of
all the terms,
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covenants and conditions of this Agreement by Tenant to be observed and
performed. The Security Deposit shall not be mortgaged, assigned, transferred or
otherwise encumbered by Tenant without the prior written consent of Landlord and
any such act on the part of Tenant without first having obtained Landlord's
consent (which consent may be given or withheld by Landlord in Landlord's sole
and absolute discretion) shall be without force and effect and shall not be
binding upon Landlord; provided, however, that such consent shall not be
required to the extent permitted by Article 19.
If any Event of Default shall occur and be continuing, Landlord may, at
its option and without prejudice to any other remedy which Landlord may have on
account thereof, appropriate and apply the entire Security Deposit or so much
thereof as may be necessary to compensate Landlord toward the payment of the
Rent or other sums or loss or damage sustained by Landlord due to such breach by
Tenant and Tenant shall, upon demand, restore the Security Deposit to the
original sum deposited. It is understood and agreed that the Security Deposit is
not to be considered as prepaid rent, nor shall damages be limited to the amount
of the Security Deposit. Should Tenant comply with all the terms, covenants and
conditions of this Agreement, the Security Deposit shall be returned in full to
Tenant at the end of the Term. Landlord shall have no obligation to pay interest
on the Security Deposit and shall have the right to commingle the same with
Landlord's other funds. If Landlord conveys Landlord's interest under this
Agreement, the Security Deposit, or any part thereof not previously applied, may
be turned over by Landlord to Landlord's grantee, and, if so turned over, Tenant
shall look solely to such grantee for proper application of the Security Deposit
in accordance with the terms of this Section 3.5 and the return thereof in
accordance herewith. No Hotel Mortgagee shall be responsible to Tenant for the
return or application of the Security Deposit, whether or not it succeeds to the
position of Landlord hereunder, unless the Security Deposit shall have been
received in hand by such holder.
In the event of bankruptcy or other creditor-debtor proceedings against
Tenant, the Security Deposit shall be deemed to be applied first to the payment
of the Rent and other charges due Landlord for all periods prior to the filing
of such proceedings.
ARTICLE 4
USE OF THE LEASED PROPERTY
4.1 Permitted Use.
4.1.1 Permitted Use.
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(a) Tenant shall, at all times during the Term and at any
other time that Tenant shall be in possession of the Leased Property,
continuously use and operate, and cause the Manager to use and operate,
the Leased Property as a Wyndham Hotel and any uses incidental thereto.
Tenant shall not use (and shall direct the Manager not to use) the
Leased Property or any portion thereof for any other use without the
prior written consent of Landlord. No use shall be made or permitted to
be made of the Leased Property and no acts shall be done thereon which
will cause the cancellation of any insurance policy covering the Leased
Property or any part thereof (unless another adequate policy is
available), nor shall Tenant sell or otherwise provide or permit to be
kept, used or sold in or about the Leased Property any article which
may be prohibited by law or by the standard form of fire insurance
policies, or any other insurance policies required to be carried
hereunder, or fire underwriter's regulations. Tenant shall, at its sole
cost (except as expressly provided in Section 5.1.3(b)), comply (or
direct the Manager to comply) with all Insurance Requirements. Tenant
shall not take or omit to take (and Tenant shall direct the Manager not
to take or omit to take) any action, the taking or omission of which
materially impairs the value or the usefulness of the Leased Property
or any part thereof for its Permitted Use.
(b) In the event that, in the reasonable determination of
Tenant, it shall no longer be economically practical to operate the
Leased Property as a Wyndham Hotel, Tenant shall give Landlord Notice
thereof, which Notice shall set forth in reasonable detail the reasons
therefor. Thereafter, Landlord and Tenant shall negotiate in good faith
to agree on an alternative use for the Leased Property or substitution
of one or more other properties for the Leased Property, appropriate
adjustments to the Additional Rent and other related matters; provided,
however, in no such event shall the Minimum Rent be reduced or abated.
4.1.2 Necessary Approvals. Tenant shall proceed with all due
diligence and exercise best efforts to obtain and maintain, and shall direct the
Manager to obtain and maintain, all approvals necessary to use and operate, for
its Permitted Use, the Leased Property and the Hotel located thereon under
applicable law.
4.1.3 Lawful Use, Etc. Tenant shall not, and shall direct the
Manager not to, use or suffer or permit the use of the Leased Property or
Tenant's Personal Property, if any, for any unlawful purpose. Tenant shall not,
and shall direct the Manager not to, commit or suffer to be committed any waste
on the Leased Property, or in the Hotel, nor shall Tenant cause or permit any
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unlawful nuisance thereon or therein. Tenant shall not, and shall direct the
Manager not to, suffer nor permit the Leased Property, or any portion thereof,
to be used in such a manner as (i) might reasonably impair Landlord's title
thereto or to any portion thereof, or (ii) may reasonably allow a claim or
claims for adverse usage or adverse possession by the public, as such, or of
implied dedication of the Leased Property or any portion thereof.
4.2 Compliance with Legal/Insurance Requirements, Etc. Subject to the
provisions of Article 8 and Section 5.1.3(b), Tenant, at its sole expense, shall
(or shall direct the Manager to) (i) comply with all material Legal Requirements
and Insurance Requirements in respect of the use, operation, maintenance,
repair, alteration and restoration of the Leased Property and with the terms and
conditions of any ground lease affecting the Leased Property and (ii) procure,
maintain and comply with all appropriate licenses, and other authorizations and
agreements required for any use of the Leased Property and Tenant's Personal
Property, if any, then being made, and for the proper erection, installation,
operation and maintenance of the Leased Property or any part thereof.
4.3 Environmental Matters.
4.3.1 Restriction on Use, Etc. During the Term and any other
time that Tenant shall be in possession of the Leased Property, Tenant shall not
(and shall direct the Manager not to) store, spill upon, dispose of or transfer
to or from the Leased Property any Hazardous Substance, except in compliance
with all Applicable Laws. During the Term and any other time that Tenant shall
be in possession of the Leased Property, Tenant shall maintain (and shall direct
the Manager to maintain) the Leased Property at all times free of any Hazardous
Substance (except in compliance with all Applicable Laws). Tenant shall
promptly: (a) upon receipt of notice or knowledge and shall direct the Manager
upon receipt of notice or knowledge promptly to, notify Landlord in writing of
any material change in the nature or extent of Hazardous Substances at the
Leased Property, (b) transmit to Landlord a copy of any Community Right to Know
report which is required to be filed by Tenant or the Manager with respect to
the Leased Property pursuant to ▇▇▇▇ Title III or any other Applicable Law, (c)
transmit to Landlord copies of any citations, orders, notices or other
governmental communications received by Tenant or the Manager or their
respective agents or representatives with respect thereto (collectively,
"Environmental Notice"), which Environmental Notice requires a written response
or any action to be taken and/or if such Environmental Notice gives notice of
and/or presents a material risk of any material violation of any Applicable Law
and/or presents a material risk of any material cost, expense, loss or damage
(an "Environmental Obligation"), (d) observe and comply
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(and direct the Manager to observe and comply) with all Applicable Laws relating
to the use, maintenance and disposal of Hazardous Substances and all orders or
directives from any official, court or agency of competent jurisdiction relating
to the use or maintenance or requiring the removal, treatment, containment or
other disposition thereof, and (e) pay or otherwise dispose of any fine, charge
or Imposition related thereto, unless Tenant or the Manager shall contest the
same in good faith and by appropriate proceedings and the right to use and the
value of the Leased Property is not materially and adversely affected thereby.
If, at any time prior to the termination of this Agreement, Hazardous
Substances (other than those maintained in accordance with Applicable Laws) are
discovered on the Leased Property, subject to Tenant's and the Manager's right
to contest the same in accordance with Article 8, Tenant shall take (and shall
direct the Manager to take) all actions and incur any and all expenses, as are
required by any Government Agency and by Applicable Law, (i) to clean up and
remove from and about the Leased Property all Hazardous Substances thereon, (ii)
to contain and prevent any further release or threat of release of Hazardous
Substances on or about the Leased Property and (iii) to use good faith efforts
to eliminate any further release or threat of release of Hazardous Substances on
or about the Leased Property.
4.3.2 Indemnification of Landlord. Tenant shall protect,
indemnify and hold harmless Landlord and each Hotel Mortgagee, their trustees,
officers, agents, employees and beneficiaries, and any of their respective
successors or assigns with respect to this Agreement (collectively, the
"Indemnitees" and, individually, an "Indemnitee") for, from and against any and
all debts, liens, claims, causes of action, administrative orders or notices,
costs, fines, penalties or expenses (including, without limitation, reasonable
attorney's fees and expenses) imposed upon, incurred by or asserted against any
Indemnitee resulting from, either directly or indirectly, the presence during
the Term (or any other time Tenant shall be in possession of the Leased
Property) in, upon or under the soil or ground water of the Leased Property or
any properties surrounding the Leased Property of any Hazardous Substances in
violation of any Applicable Law or otherwise, provided that any of the foregoing
arises by reason of any failure by Tenant, the Manager or any Person claiming
by, through or under Tenant or the Manager to perform or comply with any of the
terms of this Section 4.3, except to the extent the same arise from the acts or
omissions of Landlord or any other Indemnitee or during any period that Landlord
or a Person designated by Landlord (other than Tenant) is in possession of the
Leased Property. Tenant's duty herein includes, but is not limited to, costs
associated with personal injury or property damage claims as a result of the
presence prior to the expiration or sooner termination of the Term and the
surrender of the Leased Property to Landlord in accordance with
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the terms of this Agreement of Hazardous Substances in, upon or under the soil
or ground water of the Leased Property in violation of any Applicable Law. Upon
Notice from Landlord and any other of the Indemnitees, Tenant shall undertake
the defense, at Tenant's sole cost and expense, of any indemnification duties
set forth herein, in which event, Tenant shall not be liable for payment of any
duplicative attorneys' fees incurred by any Indemnitee.
Tenant shall, upon demand, pay to Landlord, as an Additional Charge,
any cost, expense, loss or damage (including, without limitation, reasonable
attorneys' fees) reasonably incurred by Landlord and arising from a failure of
Tenant to observe and perform the requirements of this Section 4.3, which
amounts shall bear interest from the date ten (10) days after written demand
therefor is given to Tenant until paid by Tenant to Landlord at the Overdue
Rate.
4.3.3 Survival. The provisions of this Section 4.3 shall
survive the expiration or sooner termination of this Agreement.
ARTICLE 5
MAINTENANCE AND REPAIRS
5.1 Maintenance and Repair.
5.1.1 Tenant's General Obligations. Tenant shall, at its sole
cost and expense (except as expressly provided in Sections 5.1.3(b), 10.2.3 or
11.2), or shall direct the Manager to, keep the Leased Property and all private
roadways, sidewalks and curbs appurtenant thereto (and Tenant's Personal
Property) in good order and repair, reasonable wear and tear excepted (whether
or not the need for such repairs occurs as a result of Tenant's or the Manager's
use, any prior use, the elements or the age of the Leased Property or Tenant's
Personal Property or any portion thereof), and shall promptly make (or cause the
Manager to make) all necessary and appropriate repairs and replacements thereto
of every kind and nature, whether interior or exterior, structural or
nonstructural, ordinary or extraordinary, foreseen or unforeseen or arising by
reason of a condition existing prior to the commencement of the Term (concealed
or otherwise). All repairs shall be made in a good, workmanlike manner,
consistent with the Manager's and industry standards for like hotels in like
locales, in accordance with all applicable federal, state and local statutes,
ordinances, by-laws, codes, rules and regulations relating to any such work.
Tenant shall not take or omit to take (and shall direct the Manager not to take
or omit to take) any action, the taking or omission of which would materially
and adversely impair the value or the usefulness of the Leased
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Property or any part thereof for its Permitted Use. Tenant's obligations under
this Section 5.1.1(a) shall be limited in the event of any casualty or
Condemnation as set forth in Sections 10.2 and 11.2 and also as set forth in
Section 5.1.3(b) and Tenant's obligations with respect to Hazardous Substances
are as set forth in Section 4.3.
5.1.2 FF&E Reserve.
(a) Upon execution of this Agreement, Tenant shall establish a
reserve account (the "FF&E Reserve") in a bank designated by Tenant and
approved by Landlord. The purpose of the FF&E Reserve is to cover the
cost of:
(i) Replacements and renewals to the Hotel's furnishings,
fixtures and equipment;
(ii) Certain routine repairs and maintenance to the Hotel
building which are normally capitalized under GAAP such as
exterior and interior repainting, resurfacing building
walls, floors, roofs and parking areas, and replacing
folding walls and the like; and
(iii) Major repairs, alterations, improvements, renewals or
replacements to the Hotel's buildings' structure, roof, or
exterior facade, or to its mechanical, electrical, heating,
ventilating, air conditioning, plumbing or vertical
transportation systems. Tenant agrees that it will, from
time to time,
execute such reasonable documentation as may be requested by Landlord
and any Hotel Mortgagee to assist Landlord and such Hotel Mortgagee in
establishing or perfecting its security interest in Landlord's residual
interest in the funds which are in the FF&E Reserve, it being
acknowledged and agreed that the funds in the FF&E Reserve are the
property of Tenant; provided, however, that no such documentation shall
contain any amendment or modification of any of the provisions of this
Agreement. It is understood and agreed that, during the Term, the FF&E
Reserve may not be applied against debts secured by a Hotel Mortgage
nor shall any Hotel Mortgagee have the right to approve the release of
such funds pursuant to the terms of this Agreement unless and until
Landlord shall default in its obligations to such Hotel Mortgagee.
(b) Throughout the Term, Tenant shall transfer (as of the end
of each month of the Term) into the FF&E Reserve an amount equal to
five percent (5%) of Total Hotel Sales for such month. Together with
the documentation provided to Landlord pursuant to Section 3.1.2(c),
Tenant shall deliver to Landlord an Officer's Certificate setting forth
the total amount of deposits made to and expenditures from the FF&E
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Reserve for the preceding Fiscal Year, together with a reconciliation
of such expenditures with the applicable FF&E Estimate.
(c) Prior to execution of this Agreement with respect to the
1997 calendar year and, thereafter, each year, on or before December 1
of the preceding year, Tenant shall prepare an estimate (the "FF&E
Estimate") of FF&E Reserve expenditures necessary during the ensuing
Fiscal Year, and shall submit such FF&E Estimate to Landlord for its
review and approval, which approval shall not be unreasonably withheld
or delayed. In the event Landlord shall fail to respond within thirty
(30) days after receipt of the FF&E Estimate, such FF&E Estimate shall
be deemed approved by Landlord. All expenditures from the FF&E Reserve
shall be (as to both the amount of each such expenditure and the timing
thereof) both reasonable and necessary, given the objective that the
Hotel will be maintained and operated to a standard comparable to
competitive hotels.
(d) Tenant shall, consistent with the FF&E Estimate approved
by Landlord, from time to time make expenditures from the FF&E Reserve
as it deems necessary provided that Tenant shall not materially deviate
from the FF&E Estimate approved by Landlord without the prior approval
of Landlord, except in the case of emergency where immediate action is
necessary to prevent imminent danger to person or property.
(e) Upon the expiration or sooner termination of this
Agreement, funds in the FF&E Reserve and all property purchased with
funds from the FF&E Reserve during the Term shall be paid, granted and
assigned to Landlord as Additional Charges.
5.1.3 Landlord's Obligations.
(a) Except as otherwise expressly provided in this Agreement,
Landlord shall not, under any circumstances, be required to build or
rebuild any improvement on the Leased Property, or to make any repairs,
replacements, alterations, restorations or renewals of any nature or
description to the Leased Property, whether ordinary or extraordinary,
structural or nonstructural, foreseen or unforeseen, or, except as
provided in Sections 5.1.3(b), 6,2, 10.2 and 11.2, to make any
expenditure whatsoever with respect thereto, or to maintain the Leased
Property in any way. Except as otherwise expressly provided in this
Agreement, Tenant hereby waives, to the maximum extent permitted by
law, the right to make repairs at the expense of Landlord pursuant to
any law in effect on the date hereof or hereafter enacted. Landlord
shall have the right to give, record and post, as appropriate, notices
of nonresponsibility under any mechanic's lien laws now or hereafter
existing.
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(b) If, at any time, funds in the FF&E Reserve shall be
insufficient for necessary and permitted expenditures thereof or,
pursuant to the terms of this Agreement, Tenant is required to make any
expenditures in connection with any repair, maintenance or renovation
with respect to the Leased Property and the amount of such
disbursements or expenditures exceeds the amount on deposit in the FF&E
Reserve or such repair, maintenance or renovation is not a permitted
expenditure from the FF&E Reserve as described in Section 5.1.2(a)(i),
(ii) and (iii), Tenant may, at its election, give Landlord Notice
thereof, which Notice shall set forth, in reasonable detail, the nature
of the required repair, renovation or replacement, the estimated cost
thereof and such other information with respect thereto as Landlord may
reasonably require. Provided that no Event of Default shall have
occurred and be continuing and Tenant shall otherwise comply with the
applicable provisions of Article 6, Landlord shall, within ten (10)
Business Days after such Notice, subject to and in accordance with the
applicable provisions of Article 6, disburse such required funds to
Tenant (or, if Tenant shall so elect, directly to the Manager or any
other Person performing the required work) and, upon such disbursement,
the Minimum Rent shall be adjusted as provided in Section 3.1.1(b);
provided, however, that, in the event that Landlord shall elect not to
disburse any funds pursuant to this Section 5.1.3(b), Tenant's sole
recourse shall be to elect not to make the applicable repair,
maintenance or renovation.
5.1.4 Nonresponsibility of Landlord, Etc. All materialmen,
contractors, artisans, mechanics and laborers and other persons contracting with
Tenant with respect to the Leased Property, or any part thereof, are hereby
charged with notice that liens on the Leased Property or on Landlord's interest
therein are expressly prohibited and that they must look solely to Tenant to
secure payment for any work done or material furnished by Tenant, the Manager or
for any other purpose during the term of this Agreement.
Nothing contained in this Agreement shall be deemed or construed in any
way as constituting the consent or request of Landlord, express or implied, by
inference or otherwise, to any contractor, subcontractor, laborer or materialmen
for the performance of any labor or the furnishing of any materials for any
alteration, addition, improvement or repair to the Leased Property or any part
thereof or as giving Tenant any right, power or authority to contract for or
permit the rendering of any services or the furnishing of any materials that
would give rise to the filing of any lien against the Leased Property or any
part thereof nor to subject Landlord's estate in the Leased Property or any part
thereof to liability under any Mechanic's Lien Law of
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the State in any way, it being expressly understood Landlord's estate shall not
be subject to any such liability.
5.2 Tenant's Personal Property. Tenant shall provide and maintain
throughout the Term all such Tenant's Personal Property as shall be necessary in
order to operate in compliance with applicable Legal Requirements and Insurance
Requirements and otherwise in accordance with customary practice in the industry
for the Permitted Use and all of such Personal Property shall, upon the
expiration or earlier termination of this Agreement, become the property of
Landlord. If, from and after the Commencement Date, Tenant acquires an interest
in any item of tangible personal property (other than motor vehicles) on, or in
connection with, the Leased Property which belongs to anyone other than Tenant,
Tenant shall require the agreements permitting such use to provide that Landlord
or its designee may assume Tenant's rights and obligations under such agreement
upon the termination of this Agreement and the assumption of management or
operation of the Hotel by Landlord or its designee.
5.3 Yield Up. Upon the expiration or sooner termination of this
Agreement, Tenant shall vacate and surrender the Leased Property to Landlord in
substantially the same condition in which the Leased Property was in on the
Commencement Date, except as repaired, rebuilt, restored, altered or added to as
permitted or required by the provisions of this Agreement, reasonable wear and
tear excepted (and casualty damage and Condemnation, in the event that this
Agreement is terminated following a casualty or total Condemnation in accordance
with Article 10 or Article 11 excepted).
In addition, upon the expiration or earlier termination of this
Agreement, Tenant shall, at Landlord's sole cost and expense, use its good faith
efforts to transfer to and cooperate with Landlord or Landlord's nominee in
connection with the processing of all applications for licenses, operating
permits and other governmental authorizations and all contracts, including
contracts with governmental or quasi-governmental Entities which may be
necessary for the use and operation of the Hotel as then operated. If requested
by Landlord, Tenant will direct the Manager to continue to manage the Hotel
after the expiration of the Term and for up to one hundred twenty (120) days, on
such reasonable terms (which shall include a market rate management fee and an
agreement to reimburse the Manager for its reasonable out-of-pocket costs and
expenses, and reasonable administrative costs), as Landlord shall reasonably
request.
5.4 Management Agreement. Tenant shall not, without Landlord's prior
written consent, amend or modify the provisions of the Management Agreement
which provide (i) that, from and after the occurrence of any Default or Event of
Default, all amounts due from Tenant to the Manager shall be subordinate to
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all amounts due from Tenant to Landlord, (ii) for operation of the Leased
Property under the "Wyndham" name, (iii) that Wyndham, the Manager and their
Affiliated Persons are prohibited from operating, managing or franchising
another full-service Wyndham Hotel (as opposed to Wyndham Garden or resort
hotels) within the designated area on Exhibit D and (iv) for termination
thereof, at Landlord's option, upon the termination of this Agreement. Tenant
shall not take any action, grant any consent or permit any action under the
Management Agreement which might have a material adverse effect on Landlord,
without the prior written consent of Landlord; provided, however, that
Landlord's consent shall not be required in connection with any assignment of
the Manager's rights under the Management Agreement to (x) any Affiliated Person
of the Manager having the full power, right and authority to provide all
services and organizational expertise as contemplated and required by the
Management Agreement or (y) any Person (including, but not limited to, any
Lending Institution) who acquires all or substantially all of the management
contracts of the Manager, provided that, in either such case, the Leased
Property will retain the right to use the "Wyndham" name. In the event of an
assignment pursuant to clause (y) preceding, provided that the successor Manager
(i) assumes, in writing all obligations of the Manager under the Management
Agreement, and (ii) has a Tangible Net Worth, as of the date of assignment,
equal to the greater of the Tangible Net Worth of the Manager as of the date of
this Agreement, and the Tangible Net Worth of the Manager as of the date of such
assignment, the Manager shall be released from all liabilities arising under the
Management Agreement from and after the effective date of such assignment.
Tenant shall not agree to any change in the Manager (except as provided in the
preceding sentences), to any change in the Management Agreement (except as
provided in the preceding sentences), terminate the Management Agreement or
permit the Manager to assign the Management Agreement (except as provided in the
preceding sentences) without the prior written approval of Landlord in each
instance; provided, however, that the Manager may grant a security interest in
its right to receive payments under the Management Agreement without Landlord's
prior written approval.
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ARTICLE 6
IMPROVEMENTS, ETC.
6.1 Improvements to the Leased Property. Tenant shall not make,
construct or install (and shall direct the Manager not to construct or install)
any Capital Additions (other than Capital Additions of the type described in
Section 5.1.2(a)(ii) and approved pursuant to Section 5.1.2(c) or which are
described in Exhibit B, attached hereto and made a part hereof, without, in each
instance, obtaining Landlord's prior written consent, which consent shall not be
unreasonably withheld, delayed or conditioned provided that (a) construction or
installation of the same would not adversely affect or violate any Legal
Requirement or Insurance Requirement applicable to the Leased Property and (b)
Landlord shall have received an Officer's Certificate certifying as to the
satisfaction of the conditions set out in clause (a) above; provided, however,
that no such consent shall be required in the event immediate action is required
to prevent imminent danger to person or property. Prior to commencing
construction of any Capital Addition, Tenant shall submit, or shall direct the
Manager to submit, to Landlord, in writing, a proposal setting forth, in
reasonable detail, any such proposed improvement and shall provide to Landlord
such plans and specifications, and such permits, licenses, contracts and such
other information concerning the same as Landlord may reasonably request.
Landlord shall have thirty (30) days to review all materials submitted to
Landlord in connection with any such proposal. Failure of Landlord to respond to
Tenant's or the Manager's proposal within thirty (30) days after receipt of all
information and materials requested by Landlord in connection with the proposed
improvement shall be deemed to constitute approval of the same. Without limiting
the generality of the foregoing, such proposal shall indicate the approximate
projected cost of constructing such proposed improvement and the use or uses to
which it will be put. No Capital Addition shall be made which would tie in or
connect any Leased Improvement with any other improvements on property adjacent
to the Leased Property (and not part of the Land) including, without limitation,
tie-ins of buildings or other structures or utilities. Tenant shall not finance,
and shall direct the Manager not to finance, the cost of any construction of
such improvement by the granting of a lien on or security interest in the Leased
Property or such improvement, or Tenant's interest therein, without the prior
written consent of Landlord, which consent may be withheld by Landlord in
Landlord's sole discretion. Any such improvements shall, upon the expiration or
sooner termination of this Agreement, remain or pass to and become the property
of Landlord, free and clear of all encumbrances other than Permitted
Encumbrances.
6.2 Improvement Advances. At any time during that portion of the Term
commencing on the Commencement Date and expiring one
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year thereafter, Landlord agrees to advance to Tenant, from time to time, as
hereinafter provided, an aggregate amount of up to Three Million Two Hundred
Fifty Thousand Dollars ($3,250,000) for the purpose of making improvements to
the Leased Property in accordance with Exhibit B. The obligation of Landlord to
make each advance pursuant to this Section 6.2 shall be subject to the prior or
simultaneous satisfaction of the following conditions:
(a) At the time of each disbursement, no Default or Event of
Default shall have occurred and be continuing;
(b) At least fifteen (15) Business Days before the date on
which Tenant desires a disbursement to be made hereunder (but in no
event subsequent to the first anniversary of the Commencement Date),
Tenant shall submit to Landlord a written requisition and the
substantiation therefor which shall include bills and invoices with
respect to the work for which payment or reimbursement is sought,
together with such other information with respect thereto as Landlord
may reasonably require, including, without limitation, the items
identified in Section 6.3, if applicable. Any such requisition shall be
for not less than $250,000 (or such lesser amount as shall constitute
the difference between $3,250,000 and the aggregate of all prior
disbursements). Such requisitions shall be made not more frequently
than monthly; and
(c) The aggregate amount paid or payable to Tenant and its
Affiliated Persons shall not exceed One Hundred Three Thousand Dollars
($103,000).
6.3 Improvements Financed by Landlord. In connection with the
Landlord's funding of any improvements pursuant to Section 6.2), Tenant shall
provide Landlord with such information as Landlord may from time to time
reasonably request, including, without limitation, the following:
(a) Evidence that such improvement will be, and, upon
completion, has been, completed in compliance with all Applicable Laws;
(b) Copies of all building, zoning and land use permits and
approvals and upon completion of such improvement, a copy of the
certificate of occupancy for such improvement, if required;
(c) Such information, certificates, licenses, permits or other
documents necessary to confirm that Tenant will be able to use the
improvement upon completion thereof in accordance with the Permitted
Use, including all required federal, State or local government licenses
and approvals;
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(d) An Officer's Certificate and a certificate from Tenant's
architect setting forth, in reasonable detail, the projected (or
actual, if available) improvement cost and invoices and lien waivers
from Tenant's contractors for such work as is completed and paid for
through the last advance date; and
(e) Prints of architectural and engineering drawings relating
to such improvement and such other certificates, documents and surveys
as Landlord may reasonably require.
6.4 Salvage. All materials which are scrapped or removed in connection
with the making of either Capital Additions or non-Capital Additions or repairs
required by Article 5 shall be or become the property of the party that paid for
such work.
ARTICLE 7
LIENS
7.1 Liens. Subject to Article 8, Tenant shall not, directly or
indirectly, create or allow to remain and shall promptly discharge, at its
expense, any lien, encumbrance, attachment, title retention agreement or claim
upon the Leased Property or Tenant's leasehold interest therein or any
attachment, levy, claim or encumbrance in respect of the Rent, other than (a)
Permitted Encumbrances, (b) restrictions, liens and other encumbrances which are
consented to in writing by Landlord, (c) liens for those taxes of Landlord which
Tenant is not required to pay hereunder, (d) subleases permitted by Article 17,
(e) liens for Impositions or for sums resulting from noncompliance with Legal
Requirements so long as (i) the same are not yet due and payable, or (ii) are
being contested in accordance with Article 8, (f) liens of mechanics, laborers,
materialmen, suppliers or vendors incurred in the ordinary course of business
that are not yet due and payable or are for sums that are being contested in
accordance with Article 8, (g) any Hotel Mortgages or other liens which are the
responsibility of Landlord pursuant to the provisions of Article 21, (h)
Landlord Liens and any other voluntary liens created by Landlord and (i)
Leasehold Mortgages.
7.2 Landlord's Lien. In addition to any statutory landlord's lien and
in order to secure payment of the Rent and all other sums payable hereunder by
Tenant, and to secure payment of any loss, cost or damage which Landlord may
suffer by reason of Tenant's breach of this Agreement, Tenant hereby grants unto
Landlord a security interest in and an express contractual lien upon Tenant's
Personal Property (except motor vehicles and liquor licenses and permits), and
Tenant's interest in all ledger sheets, files, records, documents and
instruments (including,
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without limitation, computer programs, tapes and related electronic data
processing) relating to the operation of the Hotels (the "Records") and all
proceeds therefrom, subject to any Permitted Encumbrances; and such Tenant's
Personal Property shall not be removed from the Leased Property at any time when
a Default or an Event of Default has occurred and is continuing.
Upon Landlord's request, Tenant shall execute and deliver to Landlord
financing statements in form sufficient to perfect the security interest of
Landlord in Tenant's Personal Property and the proceeds thereof in accordance
with the provisions of the applicable laws of the State. Tenant hereby grants
Landlord an irrevocable limited power of attorney, coupled with an interest, to
execute all such financing statements in Tenant's name, place and stead. The
security interest herein granted is in addition to any statutory lien for the
Rent.
ARTICLE 8
PERMITTED CONTESTS
Tenant shall have the right to contest the amount or validity of any
Imposition, Legal Requirement, Insurance Requirement, Environmental Obligation,
lien, attachment, levy, encumbrance, charge or claim (collectively, "Claims") as
to the Leased Property, by appropriate legal proceedings, conducted in good
faith and with due diligence, provided that (a) the foregoing shall in no way be
construed as relieving, modifying or extending Tenant's obligation to pay any
Claims as finally determined, (b) such contest shall not cause Landlord or
Tenant to be in default under any mortgage or deed of trust encumbering the
Leased Property (Landlord agreeing that any such mortgage or deed of trust shall
permit Tenant to exercise the rights granted pursuant to this Article 8) or any
interest therein or result in or reasonably be expected to result in a lien
attaching to the Leased Property, (c) no part of the Leased Property nor any
Rent therefrom shall be in any immediate danger of sale, forfeiture, attachment
or loss, and (d) Tenant shall indemnify and hold harmless Landlord from and
against any cost, claim, damage, penalty or reasonable expense, including
reasonable attorneys' fees, incurred by Landlord in connection therewith or as a
result thereof. Landlord agrees to join in any such proceedings if required
legally to prosecute such contest, provided that Landlord shall not thereby be
subjected to any liability therefor (including, without limitation, for the
payment of any costs or expenses in connection therewith) unless Tenant agrees
by agreement in form and substance reasonably satisfactory to Landlord, to
assume and indemnify Landlord with respect to the same. Tenant shall be entitled
to any refund of any Claims and such charges and penalties or interest thereon
which have been paid by Tenant or paid by Landlord to the extent that Landlord
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has been fully reimbursed by Tenant. If Tenant shall fail (x) to pay or cause to
be paid any Claims when finally determined, (y) to provide reasonable security
therefor, or (z) to prosecute or cause to be prosecuted any such contest
diligently and in good faith, Landlord may, upon reasonable notice to Tenant
(which notice shall not be required if Landlord shall reasonably determine that
the same is not practicable), pay such charges, together with interest and
penalties due with respect thereto, and Tenant shall reimburse Landlord
therefor, upon demand, as Additional Charges.
ARTICLE 9
INSURANCE AND INDEMNIFICATION
9.1 General Insurance Requirements. Tenant shall, at all times during
the Term and at any other time Tenant shall be in possession of the Leased
Property, keep the Leased Property and all property located therein or thereon,
insured against the risks and in the amounts as follows and shall maintain the
following insurance:
(a) "All-risk" property insurance, including insurance against
loss or damage by fire, vandalism and malicious mischief, earthquake,
explosion of steam boilers, pressure vessels or other similar
apparatus, now or hereafter installed in the Hotel located at the
Leased Property, with the usual extended coverage endorsements, in an
amount equal to one hundred percent (100%) of the then full Replacement
Cost thereof (as defined in Section 9.2);
(b) Business interruption insurance covering risk of loss
during the lesser of the first twelve (12) months of reconstruction or
the actual reconstruction period necessitated by the occurrence of any
of the hazards described in subparagraph (a) above, in such amounts as
may be customary for comparable properties in the area and in an amount
sufficient to prevent Landlord or Tenant from becoming a co-insurer;
(c) Comprehensive general liability insurance, including
bodily injury and property damage in a form reasonably satisfactory to
Landlord (and including, without limitation, broad form contractual
liability, independent contractor's hazard and completed operations
coverage) in an amount not less than One Million Dollars ($1,000,000)
per occurrence, Three Million Dollars ($3,000,000) in the aggregate and
umbrella coverage of all such claims in an amount not less than Fifty
Million Dollars ($50,000,000);
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(d) Flood (if the Leased Property is located in whole or in
part within an area identified as an area having special flood hazards
and in which flood insurance has been made available under the National
Flood Insurance Act of 1968, as amended, or the Flood Disaster
Protection Act of 1973, as amended (or any successor acts thereto)) and
such other hazards and in such amounts as may be customary for
comparable properties in the area;
(e) Worker's compensation insurance coverage if required by
applicable law for all persons employed by Tenant on the Leased
Property with statutory limits and otherwise with limits of and
provisions in accordance with the requirements of applicable local,
State and federal law, and employer's liability insurance as is
customarily carried by similar employers; and
(f) Such additional insurance as may be reasonably required,
from time to time, by Landlord or any Hotel Mortgagee and which is
customarily carried by comparable lodging properties in the area.
9.2 Replacement Cost. "Replacement Cost" as used herein shall mean the
actual replacement cost of the property requiring replacement from time to time,
including an increased cost of construction endorsement, less exclusions
provided in the standard form of fire insurance policy. In the event either
party believes that the then full Replacement Cost has increased or decreased at
any time during the Term, such party, at its own cost, shall have the right to
have such full Replacement Cost redetermined by an independent accredited
appraiser approved by the other, which approval shall not be unreasonably
withheld or delayed. The party desiring to have the full Replacement Cost so
redetermined shall forthwith, on receipt of such determination by such
appraiser, give Notice thereof to the other. The determination of such appraiser
shall be final and binding on the parties hereto until any subsequent
determination under this Section 9.2, and Tenant shall forthwith conform the
amount of the insurance carried to the amount so determined by the appraiser.
9.3 Waiver of Subrogation. Landlord and Tenant agree that (insofar as
and to the extent that such agreement may be effective without invalidating or
making it impossible to secure insurance coverage from responsible insurance
companies doing business in the State) with respect to any property loss which
is covered by insurance then being carried by Landlord or Tenant, respectively,
the party carrying such insurance and suffering said loss releases the other of
and from any and all claims with respect to such loss; and they further agree
that their respective insurance companies shall have no right of subrogation
against the other on account thereof, even though extra premium may result
therefrom. In the event that any extra premium is
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payable by Tenant as a result of this provision, Landlord shall not be liable
for reimbursement to Tenant for such extra premium.
9.4 Form Satisfactory, Etc. All insurance policies and endorsements
required pursuant to this Article 9 shall be fully paid for, nonassessable and
be issued by insurance carriers authorized to do business in the State, having a
general policy holder's rating of no less than B++ in Best's latest rating
guide. All such policies described in Sections 9.1(a) through (d) shall include
no deductible in excess of Two Hundred Fifty Thousand Dollars ($250,000) and,
with the exception of the insurance described in Sections 9.1(e), shall name
Landlord and any Hotel Mortgagee as additional insureds, as their interests may
appear. All loss adjustments shall be payable as provided in Article 10. Tenant
shall cause all insurance premiums to be paid and shall deliver certificates of
insurance to Landlord prior to their effective date (and, with respect to any
renewal policy, prior to the expiration of the existing policy). All such
policies shall provide Landlord (and any Hotel Mortgagee if required by the
same) thirty (30) days prior written notice of any material change or
cancellation of such policy. In the event Tenant shall fail to effect such
insurance as herein required, to pay the premiums therefor or to deliver such
certificates to Landlord or any Hotel Mortgagee at the times required, Landlord
shall have the right, but not the obligation, subject to the provisions of
Section 12.5, to acquire such insurance and pay the premiums therefor, which
amounts shall be payable to Landlord, upon demand, as Additional Charges,
together with interest accrued thereon at the Overdue Rate from the date such
payment is made until (but excluding) the date repaid.
9.5 Blanket Policy. Notwithstanding anything to the contrary contained
in this Article 9, Tenant's obligation to maintain the insurance herein required
may be brought within the coverage of a so-called blanket policy or policies of
insurance carried and maintained by Tenant, provided, that (a) the coverage
thereby afforded will not be reduced or diminished from that which would exist
under a separate policy meeting all other requirements of this Agreement, and
(b) the requirements of this Article 9 are otherwise satisfied.
9.6 No Separate Insurance. Tenant shall not take out separate
insurance, concurrent in form or contributing in the event of loss with that
required by this Article 9, or increase the amount of any existing insurance by
securing an additional policy or additional policies, unless all parties having
an insurable interest in the subject matter of such insurance, including
Landlord and all Hotel Mortgagees, are included therein as additional insureds
and the loss is payable under such insurance in the same manner as losses are
payable under this Agreement. In the event Tenant shall take out any such
separate
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insurance or increase any of the amounts of the then existing insurance, Tenant
shall give Landlord prompt Notice thereof.
9.7 Indemnification of Landlord. Notwithstanding the existence of any
insurance provided for herein and without regard to the policy limits of any
such insurance, Tenant shall protect, indemnify and hold harmless Landlord for,
from and against all liabilities, obligations, claims, damages, penalties,
causes of action, costs and reasonable expenses (including, without limitation,
reasonable attorneys' fees), to the maximum extent permitted by law, imposed
upon or incurred by or asserted against Landlord by reason of: (a) any accident,
injury to or death of persons or loss of or damage to property occurring on or
about the Leased Property or adjoining sidewalks or rights of way, (b) any past,
present or future use, misuse, non-use, condition, management, maintenance or
repair by Tenant or anyone claiming under Tenant of the Leased Property or
Tenant's Personal Property or any litigation, proceeding or claim by
governmental entities or other third parties to which Landlord is made a party
or participant relating to the Leased Property or Tenant's Personal Property or
such use, misuse, non-use, condition, management, maintenance, or repair thereof
including, failure to perform obligations (other than Condemnation proceedings)
to which Landlord is made a party, (c) any Impositions that are the obligations
of Tenant to pay pursuant to the applicable provisions of this Agreement, and
(d) any failure on the part of Tenant or anyone claiming under Tenant to perform
or comply with any of the terms of this Agreement. Tenant, at its expense, shall
contest, resist and defend any such claim, action or proceeding asserted or
instituted against Landlord (and shall not be responsible for any duplicative
attorneys' fees incurred by Landlord) or may compromise or otherwise dispose of
the same, with Landlord's prior written consent (which consent may not be
unreasonably withheld or delayed). In the event Landlord shall unreasonably
withhold or delay its consent, Tenant shall not be liable pursuant to this
Section 9.7 for any incremental increase in costs or expenses resulting
therefrom. The obligations of Tenant under this Section 9.7 are in addition to
the obligations set forth in Section 4.3 and shall survive the termination of
this Agreement.
ARTICLE 10
CASUALTY
10.1 Insurance Proceeds. Except as provided in the last clause of this
sentence, all proceeds payable by reason of any loss or damage to the Leased
Property, or any portion thereof, and insured under any policy of insurance
required by Article 9 (other than the proceeds of any business interruption
insurance) shall be paid directly to Landlord (subject to the provisions of
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Section 10.2) and all loss adjustments with respect to losses payable to
Landlord shall require the prior written consent of Landlord; provided, however,
that, so long as no Event of Default shall have occurred and be continuing, all
such proceeds less than or equal to Two Hundred Fifty Thousand Dollars
($250,000) shall be paid directly to Tenant and such losses may be adjusted
without Landlord's consent. If Tenant is required to reconstruct or repair the
Leased Property as provided herein, such proceeds shall be paid out by Landlord
from time to time for the reasonable costs of reconstruction or repair of the
Leased Property necessitated by such damage or destruction, subject to and in
accordance with the provisions of Section 10.2.4. Provided no Default or Event
of Default has occurred and is continuing, any excess proceeds of insurance
remaining after the completion of the restoration shall be paid to Tenant. In
the event that the provisions of Section 10.2.1 are applicable, the insurance
proceeds shall be retained by the party entitled thereto pursuant to Section
10.2.1. All salvage resulting from any risk covered by insurance shall belong to
Landlord, provided any rights to the same have been waived by the insurer.
10.2 Damage or Destruction.
10.2.1 Damage or Destruction of Leased Property. If, during
the Term, the Leased Property shall be totally or partially destroyed and the
Hotel located thereon is thereby rendered Unsuitable for Its Permitted Use,
either Landlord or Tenant may, by the giving of Notice thereof to the other,
terminate this Agreement, whereupon, this Agreement shall terminate, Landlord
shall be entitled to retain the insurance proceeds payable on account of such
damage and Tenant shall thereafter have no obligation to pay Rent for periods
arising after the effective date of termination.
10.2.2 Partial Damage or Destruction. If, during the Term, the
Leased Property shall be totally or partially destroyed but the Hotel is not
rendered Unsuitable for Its Permitted Use, Tenant shall, subject to Section
10.2.3, promptly restore the Hotel as provided in Section 10.2.4.
10.2.3 Insufficient Insurance Proceeds. If this Agreement is
not otherwise terminated pursuant to this Article 10 and the cost of the repair
or restoration of the Leased Property exceeds the amount of insurance proceeds
received by Landlord and Tenant pursuant to Article 9(a), (c), (d) or, if
applicable, (e), Tenant shall give Landlord Notice thereof which notice shall
set forth in reasonable detail the nature of such deficiency and whether Tenant
shall pay and assume the amount of such deficiency (Tenant having no obligation
to do so, except that, if Tenant shall elect to make such funds available, the
same shall become an irrevocable obligation of Tenant pursuant to this
Agreement). In the event Tenant shall elect not to pay and assume the amount
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of such deficiency, Landlord shall have the right (but not the obligation),
exercisable at Landlord's sole election by Notice to Tenant, given within sixty
(60) days after Tenant's notice of the deficiency, to elect to make available
for application to the cost of repair or restoration the amount of such
deficiency; provided, however, in such event, upon any disbursement by Landlord
thereof, the Minimum Rent shall be adjusted as provided in Section 3.1.1(b). In
the event that neither Landlord nor Tenant shall elect to make such deficiency
available for restoration, either Landlord or Tenant may terminate this
Agreement by Notice to the other, whereupon, this Agreement shall terminate as
provided in Section 10.2.1. It is expressly understood and agreed, however,
that, notwithstanding anything in this Agreement to the contrary, Tenant shall
be strictly liable and solely responsible for the amount of any deductible and
shall, upon any insurable loss, pay over the amount of such deductible to
Landlord at the time and in the manner herein provided for payment of the
applicable proceeds to Landlord.
10.2.4 Disbursement of Proceeds. In the event Tenant is
required to restore the Leased Property pursuant to Section 10.2, Tenant shall
(or shall direct the Manager to) commence promptly and continue diligently to
perform the repair and restoration of the Leased Property (hereinafter called
the "Work"), so as to restore the Leased Property in compliance with all Legal
Requirements and so that the Leased Property shall be, to the extent
practicable, substantially equivalent in value and general utility to its
general utility and value immediately prior to such damage or destruction.
Subject to the terms hereof, Landlord shall advance the insurance proceeds and
any additional amounts payable by Landlord pursuant to Section 10.2.3 to Tenant
regularly during the repair and restoration period so as to permit payment for
the cost of any such restoration and repair. Any such advances shall be made not
more than monthly within ten (10) Business Days after Tenant submits to Landlord
a written requisition and substantiation therefor on AIA Forms G702 and G703 (or
on such other form or forms as may be reasonably acceptable to Landlord).
Landlord may, at its option, condition advancement of said insurance proceeds
and other amounts on (i) the absence of any Event of Default, (ii) its approval
of plans and specifications of an architect satisfactory to Landlord (which
approval shall not be unreasonably withheld, delayed or conditioned), (iii)
general contractors' estimates, (iv) architect's certificates, (v) unconditional
lien waivers of general contractors, if available, (vi) evidence of approval by
all governmental authorities and other regulatory bodies whose approval is
required and (vii) such other certificates as Landlord may, from time to time,
reasonably require.
Landlord's obligation to disburse insurance proceeds under this Article
10 during the last two (2) years of the Term shall be subject to the release of
such proceeds by any Hotel Mortgagee
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to Landlord; otherwise each such Hotel Mortgagee shall be obligated to make such
funds available for Landlord's use in accordance with the terms of this
Agreement. If any Hotel Mortgagee shall be unwilling to disburse insurance
proceeds in accordance with this Agreement, Tenant shall have the right to
terminate this Agreement and Tenant shall thereafter have no obligation to pay
Rent for periods arising after the effective date of termination.
Tenant's obligation to restore the Leased Property pursuant to this
Article 10 shall be subject to the release of available insurance proceeds by
the applicable Hotel Mortgagee to Landlord or directly to Tenant and, in the
event such proceeds are insufficient, Landlord electing to make such deficiency
available therefor (and disbursement of such deficiency).
10.3 Damage Near End of Term. Notwithstanding any provisions of Section
10.1 or 10.2 to the contrary, if damage to or destruction of the Leased Property
occurs during the last twelve (12) months of the Term (including any exercised
Extended Terms) and if such damage or destruction cannot reasonably be expected
to be fully repaired and restored prior to the date that is six (6) months prior
to the end of such Term, the provisions of Section 10.2.1 shall apply as if the
Leased Property had been totally or partially destroyed and the Hotel rendered
Unsuitable for its Permitted Use.
10.4 Tenant's Property. All insurance proceeds payable by reason of any
loss of or damage to any of Tenant's Personal Property shall be paid to Tenant
and, to the extent necessary to repair or replace Tenant's Personal Property in
accordance with Section 10.5, Tenant shall hold such proceeds in trust to pay
the cost of repairing or replacing damaged Tenant's Personal Property.
10.5 Restoration of Tenant's Property. If Tenant is required to restore
the Leased Property as hereinabove provided, Tenant shall either (a) restore all
alterations and improvements made by Tenant and Tenant's Personal Property, or
(b) replace such alterations and improvements and Tenant's Personal Property
with improvements or items of the same or better quality and utility in the
operation of the Leased Property.
10.6 No Abatement of Rent. This Agreement shall remain in full force
and effect and Tenant's obligation to make all payments of Rent and to pay all
other charges as and when required under this Agreement shall remain unabated
during the Term notwithstanding any damage involving the Leased Property
(provided that Landlord shall credit against such payments any amounts paid to
Landlord as a consequence of such damage under any business interruption
insurance obtained by Tenant hereunder). The provisions of this Article 10 shall
be
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considered an express agreement governing any cause of damage or destruction to
the Leased Property and, to the maximum extent permitted by law, no local or
State statute, laws, rules, regulation or ordinance in effect during the Term
which provide for such a contingency shall have any application in such case.
10.7 Waiver. Tenant hereby waives any statutory rights of termination
which may arise by reason of any damage or destruction of the Leased Property.
ARTICLE 11
CONDEMNATION
11.1 Total Condemnation, Etc. If either (i) the whole of the Leased
Property shall be taken by Condemnation or (ii) a Condemnation of less than the
whole of the Leased Property renders the Leased Property Unsuitable for Its
Permitted Use, this Agreement shall terminate, Tenant and Landlord shall seek
the Award for their interests in the Leased Property as provided in Section 11.5
and Tenant shall thereafter have no obligation to pay Rent for periods arising
after the effective date of termination.
11.2 Partial Condemnation. In the event of a Condemnation of less than
the whole of the Leased Property such that the Leased Property is still suitable
for its Permitted Use, Tenant shall, to the extent of the Award actually
received by Tenant and any additional amounts disbursed by Landlord as
hereinafter provided, commence promptly and continue diligently to restore the
untaken portion of the Leased Improvements so that such Leased Improvements
shall constitute a complete architectural unit of the same general character and
condition (as nearly as may be possible under the circumstances) as the Leased
Improvements existing immediately prior to such Condemnation, in full compliance
with all Legal Requirements, subject to the provisions of this Section 11.2. If
the cost of the repair or restoration of the Leased Property exceeds the amount
of the Award, Tenant shall give Landlord Notice thereof which notice shall set
forth in reasonable detail the nature of such deficiency and whether Tenant
shall pay and assume the amount of such deficiency (Tenant having no obligation
to do so, except that if Tenant shall elect to make such funds available, the
same shall become an irrevocable obligation of Tenant pursuant to this
Agreement). In the event Tenant shall elect not to pay and assume the amount of
such deficiency, Landlord shall have the right (but not the obligation),
exercisable at Landlord's sole election by Notice to Tenant given within sixty
(60) days after Tenant's Notice of the deficiency, to elect to make available
for application to the cost of repair or restoration the amount of such
deficiency; provided, however, in such event, upon any
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disbursement by Landlord thereof, the Minimum Rent shall be adjusted as provided
in Section 3.1.1(b). In the event that neither Landlord nor Tenant shall elect
to make such deficiency available for restoration, either Landlord or Tenant may
terminate this Agreement, whereupon, the entire Award shall be retained by
Landlord and Tenant shall thereafter have no obligation to pay Rent for periods
arising after the effective date of termination.
Subject to the terms hereof, Landlord shall contribute to the cost of
restoration that part of the Award necessary to complete such repair or
restoration, together with severance and other damages awarded for the taken
Leased Improvements and any deficiency Landlord has agreed to disburse, to
Tenant regularly during the restoration period so as to permit payment for the
cost of such repair or restoration. Landlord may, at its option, condition
advancement of such Award and other amounts on (i) the absence of any Event of
Default, (ii) its approval of plans and specifications of an architect
satisfactory to Landlord (which approval shall not be unreasonably withheld or
delayed), (iii) general contractors' estimates, (iv) architect's certificates,
(v) unconditional lien waivers of general contractors, if available, (vi)
evidence of approval by all governmental authorities and other regulatory bodies
whose approval is required and (vii) such other certificates as Landlord may,
from time to time, reasonably require. Landlord's obligation under this Section
11.2 to disburse the Award and such other amounts shall be subject to (x) the
collection thereof by Landlord and (y) during the last two (2) years of the
Term, the release of such Award by the applicable Hotel Mortgagee; otherwise
each such Hotel Mortgagee shall be obligated to make such funds available for
Landlord's use in accordance with the terms of this Agreement. Tenant's
obligation to restore the Leased Property shall be subject to the release of the
Award by the applicable Hotel Mortgagee to Landlord. If any Hotel Mortgagee
shall be unwilling to release such Award in accordance with this Agreement,
Tenant shall have the right to terminate this Agreement.
11.3 Abatement of Rent. Other than as specifically provided in this
Agreement, this Agreement shall remain in full force and effect and Tenant's
obligation to make all payments of Rent and to pay all other charges as and when
required under this Agreement shall remain unabated during the Term
notwithstanding any Condemnation involving the Leased Property. The provisions
of this Article 11 shall be considered an express agreement governing any
Condemnation involving the Leased Property and, to the maximum extent permitted
by law, no local or State statute, law, rule, regulation or ordinance in effect
during the Term which provides for such a contingency shall have any application
in such case.
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11.4 Temporary Condemnation. In the event of any temporary Condemnation
of the Leased Property or Tenant's interest therein, this Agreement shall
continue in full force and effect and Tenant shall continue to pay, in the
manner and on the terms herein specified, the full amount of the Rent. Tenant
shall continue to perform and observe all of the other terms and conditions of
this Agreement on the part of the Tenant to be performed and observed. Provided
no Event of Default has occurred and is continuing, the entire amount of any
Award made for such temporary Condemnation allocable to the Term, whether paid
by way of damages, rent or otherwise, shall be paid to Tenant. Tenant shall,
promptly upon the termination of any such period of temporary Condemnation, at
its sole cost and expense, restore the Leased Property to the condition that
existed immediately prior to such Condemnation, in full compliance with all
Legal Requirements, unless such period of temporary Condemnation shall extend
beyond the expiration of the Term, in which event Tenant shall not be required
to make such restoration. For purposes of this Section 11.4, a Condemnation
shall be deemed to be temporary if the period of such Condemnation is not
expected to, and does not, exceed twelve (12) months.
11.5 Allocation of Award. Except as provided in Section 11.4 and the
second sentence of this Section 11.5, the total Award shall be solely the
property of and payable to Landlord. Any portion of the Award made for the
taking of Tenant's leasehold interest in the Leased Property, loss of business
during the remainder of the Term, the taking of Tenant's Personal Property, or
Tenant's removal and relocation expenses shall be the sole property of and
payable to Tenant (subject to the provisions of Section 11.2). In any
Condemnation proceedings, Landlord and Tenant shall each seek its own Award in
conformity herewith, at its own expense.
ARTICLE 12
DEFAULTS AND REMEDIES
12.1 Events of Default. The occurrence of any one or more of the
following events shall constitute an "Event of Default" hereunder:
(a) should Tenant fail to make any payment of the Rent
or any other sum (including, but not limited to, funding of
the FF&E Reserve) payable hereunder when due; or
(b) should Tenant fail to maintain the insurance coverages
required under Article 9 and such failure shall continue for ten (10)
Business Days after Notice thereof (except that no Notice shall be
required if any such insurance coverages shall have lapsed); or
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(c) should Tenant default in the due observance or performance
of any of the terms, covenants or agreements contained herein to be
performed or observed by it (other than as specified in clauses (a) and
(b) above) and such default shall continue for a period of fifteen (15)
Business Days after Notice thereof from Landlord to Tenant; provided,
however, that if such default is susceptible of cure but such cure
cannot be accomplished with due diligence within such period of time
and if, in addition, Tenant commences to cure or cause to be cured such
default within fifteen (15) Business Days after Notice thereof from
Landlord and thereafter prosecutes the curing of such default with all
due diligence, such period of time shall be extended to such period of
time (not to exceed an additional one hundred eighty (180) days in the
aggregate) as may be necessary to cure such default with all due
diligence; or
(d) should an event of default by Tenant or any Affiliated
Person as to Tenant occur and be continuing beyond the expiration of
any applicable cure period under any of the Incidental Documents, the
Other Leases or the Management Agreement; or
(e) should there occur a final unappealable determination by
applicable state authorities of the revocation or limitation of any
material license, permit, certification or approval required for the
lawful operation of the Hotel in accordance with its Permitted Use or
the loss or material limitation of any material license, permit,
certification or approval under any other circumstances under which
Tenant is required to cease its operation of the Hotel in accordance
with its Permitted Use at the time of such loss or limitation; or
(f) should any material representation or warranty made by
Tenant or any Affiliated Person as to Tenant under or in connection
with this Agreement or any Incidental Document or in any document,
certificate or agreement delivered in connection herewith or therewith
prove to have been false or misleading in any material respect on the
date when made or deemed made and the same shall continue for five (5)
Business Days after Notice thereof from Landlord; or
(g) should Tenant generally not be paying its debts as they
become due or should Tenant make a general assignment for the benefit
of creditors; or
(h) should any petition be filed by or against Tenant under
the Federal bankruptcy laws, or should any other proceeding be
instituted by or against Tenant seeking to
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adjudicate Tenant a bankrupt or insolvent, or seeking liquidation,
reorganization, arrangement, adjustment or composition of Tenant's
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, custodian or
other similar official for Tenant or for any substantial part of the
property of Tenant and such proceeding is not dismissed within ninety
(90) days after institution thereof, or should Tenant take any action
to authorize or effect any of the actions set forth above in this
paragraph; or
(i) should Tenant cause or institute any proceeding for its
dissolution or termination, except as contemplated by or in connection
with the assignment contemplated by Section 16.5; or
(j) should the estate or interest of Tenant in the Leased
Property or any part thereof be levied upon or attached in any
proceeding and the same shall not be vacated or discharged within the
later of (x) one hundred and twenty (120) days after commencement
thereof, unless the amount in dispute is less than $250,000, in which
case Tenant shall give notice to Landlord of the dispute but Tenant may
defend in any suitable way, and (y) thirty (30) days after receipt by
Tenant of Notice thereof from Landlord (unless Tenant shall be
contesting such lien or attachment in good faith in accordance with
Article 8); or
(k) should Tenant at any time cease to be a wholly owned
direct or indirect Subsidiary of Wyndham; or
(l) should the Limited Guaranty be disaffirmed, disavowed or
challenged by Wyndham;
then, and in any such event, Landlord, in addition to all other remedies
available to it, may terminate this Agreement by giving Notice thereof to Tenant
and upon the expiration of the time, if any, fixed in such Notice, this
Agreement shall terminate and all rights of Tenant under this Agreement shall
cease. Landlord shall have and may exercise all rights and remedies available at
law and in equity to Landlord as a result of Tenant's breach of this Agreement.
Upon the occurrence of an Event of Default, Landlord may, in addition
to any other remedies provided herein, enter upon the Leased Property or any
portion thereof and take possession of any and all of Tenant's Personal
Property, if any, and the Records, without liability for trespass or conversion
(Tenant hereby waiving any right to notice or hearing prior to such taking of
possession by Landlord) and sell the same at public or private sale, after
giving Tenant reasonable Notice of the time and place
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of any public or private sale, at which sale Landlord or its assigns may
purchase all or any portion of Tenant's Personal Property, if any, unless
otherwise prohibited by law. Unless otherwise provided by law and without
intending to exclude any other manner of giving Tenant reasonable notice, the
requirement of reasonable Notice shall be met if such Notice is given at least
ten (10) days before the date of sale. The proceeds from any such disposition,
less all expenses incurred in connection with the taking of possession, holding
and selling of such property (including, reasonable attorneys' fees) shall be
applied as a credit against the indebtedness which is secured by the security
interest granted in Section 7.2. Any surplus shall be paid to Tenant or as
otherwise required by law and Tenant shall pay any deficiency to Landlord, as
Additional Charges, upon demand.
12.2 Remedies. None of (a) the termination of this Agreement pursuant
to Section 12.1, (b) the repossession of the Leased Property or any portion
thereof, (c) the failure of Landlord to re-let the Leased Property or any
portion thereof, nor (d) the reletting of all or any of portion of the Leased
Property, shall relieve Tenant of its liability and obligations hereunder, all
of which shall survive any such termination, repossession or re-letting. In the
event of any such termination, Tenant shall forthwith pay to Landlord all Rent
due and payable with respect to the Leased Property through and including the
date of such termination. Thereafter, Tenant, until the end of what would have
been the Term of this Agreement in the absence of such termination, and whether
or not the Leased Property or any portion thereof shall have been re-let, shall
be liable to Landlord for, and shall pay to Landlord, as current damages, the
Rent and other charges which would be payable hereunder for the remainder of the
Term had such termination not occurred, less the net proceeds, if any, of any
re-letting of the Leased Property, after deducting all reasonable expenses in
connection with such reletting, including, without limitation, all repossession
costs, brokerage commissions, legal expenses, attorneys' fees, advertising,
expenses of employees, alteration costs and expenses of preparation for such
reletting. Tenant shall pay such current damages to Landlord monthly on the days
on which the Minimum Rent would have been payable hereunder if this Agreement
had not been so terminated with respect to such of the Leased Property.
At any time after such termination, whether or not Landlord shall have
collected any such current damages, as liquidated final damages beyond the date
of such termination, at Landlord's election, Tenant shall pay to Landlord an
amount equal to the present value (discounted at the Interest Rate) of the
excess, if any, of the Rent and other charges which would be payable hereunder
from the date of such termination (assuming that, for the purposes of this
paragraph, annual payments by Tenant on
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account of Impositions and Additional Rent would be the same as payments
required for the immediately preceding twelve calendar months, or if less than
twelve calendar months have expired since the Commencement Date, the payments
required for such lesser period projected to an annual amount) for what would be
the then unexpired term of this Agreement if the same remained in effect, over
the fair market rental for the same period. Nothing contained in this Agreement
shall, however, limit or prejudice the right of Landlord to prove and obtain in
proceedings for bankruptcy or insolvency an amount equal to the maximum allowed
by any statute or rule of law in effect at the time when, and governing the
proceedings in which, the damages are to be proved, whether or not the amount be
greater than, equal to, or less than the amount of the loss or damages referred
to above.
In case of any Event of Default, re-entry, expiration and dispossession
by summary proceedings or otherwise, Landlord may (a) relet the Leased Property
or any part or parts thereof, either in the name of Landlord or otherwise, for a
term or terms which may at Landlord's option, be equal to, less than or exceed
the period which would otherwise have constituted the balance of the Term and
may grant concessions or free rent to the extent that Landlord considers
advisable and necessary to relet the same, and (b) may make such reasonable
alterations, repairs and decorations in the Leased Property or any portion
thereof as Landlord, in its sole and absolute discretion, considers advisable
and necessary for the purpose of reletting the Leased Property; and the making
of such alterations, repairs and decorations shall not operate or be construed
to release Tenant from liability hereunder as aforesaid. Subject to the last
sentence of this paragraph, Landlord shall in no event be liable in any way
whatsoever for any failure to relet all or any portion of the Leased Property,
or, in the event that the Leased Property is relet, for failure to collect the
rent under such reletting. To the maximum extent permitted by law, Tenant hereby
expressly waives any and all rights of redemption granted under any present or
future laws in the event of Tenant being evicted or dispossessed, or in the
event of Landlord obtaining possession of the Leased Property, by reason of the
occurrence and continuation of an Event of Default hereunder. Landlord covenants
and agrees, in the event of any termination of this Agreement as a result of an
Event of Default, to use reasonable efforts to mitigate its damages.
12.3 Tenant's Waiver. IF THIS AGREEMENT IS TERMINATED PURSUANT TO
SECTION 12.1 OR 12.2, TENANT WAIVES, TO THE EXTENT PERMITTED BY LAW, ANY RIGHT
TO A TRIAL BY JURY IN THE EVENT OF SUMMARY PROCEEDINGS TO ENFORCE THE REMEDIES
SET FORTH IN THIS ARTICLE 12, AND THE BENEFIT OF ANY LAWS NOW OR HEREAFTER IN
FORCE EXEMPTING PROPERTY FROM LIABILITY FOR RENT OR FOR DEBT.
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12.4 Application of Funds. Any payments received by Landlord under any
of the provisions of this Agreement during the existence or continuance of any
Event of Default (and any payment made to Landlord rather than Tenant due to the
existence of any Event of Default) shall be applied to Tenant's current and past
due obligations under this Agreement in such order as Landlord may determine or
as may be prescribed by the laws of the State.
12.5 Landlord's Right to Cure Tenant's Default. If an Event of Default
shall have occurred and be continuing, Landlord, after Notice to Tenant (which
Notice shall not be required if Landlord shall reasonably determine immediate
action is necessary to protect person or property), without waiving or releasing
any obligation of Tenant and without waiving or releasing any Event of Default,
may (but shall not be obligated to), at any time thereafter, make such payment
or perform such act for the account and at the expense of Tenant, and may, to
the maximum extent permitted by law, enter upon the Leased Property or any
portion thereof for such purpose and take all such action thereon as, in
Landlord's sole and absolute discretion, may be necessary or appropriate
therefor. No such entry shall be deemed an eviction of Tenant. All reasonable
costs and expenses (including, without limitation, reasonable attorneys' fees)
incurred by Landlord in connection therewith, together with interest thereon (to
the extent permitted by law) at the Overdue Rate from the date such sums are
paid by Landlord until repaid, shall be paid by Tenant to Landlord, on demand.
ARTICLE 13
HOLDING OVER
Any holding over by Tenant after the expiration or sooner termination
of this Agreement shall be treated as a daily tenancy at sufferance at a rate
equal to two (2) times the Minimum Rent and other charges herein provided
(prorated on a daily basis). Tenant shall also pay to Landlord all damages
(direct or indirect) sustained by reason of any such holding over. Otherwise,
such holding over shall be on the terms and conditions set forth in this
Agreement, to the extent applicable. Nothing contained herein shall constitute
the consent, express or implied, of Landlord to the holding over of Tenant after
the expiration or earlier termination of this Agreement.
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ARTICLE 14
LANDLORD'S NOTICE OBLIGATIONS; LANDLORD DEFAULT
14.1 Landlord Notice Obligation. Landlord shall give prompt Notice to
Tenant of any matters affecting the Leased Property of which Landlord receives
written notice or actual knowledge and, to the extent Tenant otherwise has no
notice or actual knowledge thereof, Landlord shall be liable for any liabilities
arising from the failure to deliver such Notice to Tenant.
14.2 Landlord's Default. If Landlord shall default in the performance
or observance of any of its covenants or obligations set forth in this Agreement
or any obligation of Landlord, if any, under any agreement affecting the Leased
Property, the performance of which is not Tenant's obligation pursuant to this
Agreement, and any such default shall continue for a period of ten (10) days
after Notice thereof with respect to monetary defaults and thirty (30) days
after Notice thereof with respect to non-monetary defaults from Tenant to
Landlord and any applicable Hotel Mortgagee, or such additional period as may be
reasonably required to correct the same, Tenant may declare the occurrence of a
"Landlord Default" by a second Notice to Landlord and to such Hotel Mortgagee.
Thereafter, Tenant may forthwith cure the same and, subject to the provisions of
the following paragraph, invoice Landlord for costs and expenses (including
reasonable attorneys' fees and court costs) incurred by Tenant in curing the
same, together with interest thereon (to the extent permitted by law) from the
date Landlord receives Tenant's invoice, at the Overdue Rate. Tenant shall have
no right to terminate this Agreement for any default by Landlord hereunder and
no right, for any such default, to offset or counterclaim against any Rent or
other charges due hereunder.
If Landlord shall in good faith dispute the occurrence of any Landlord
Default and Landlord, before the expiration of the applicable cure period, shall
give Notice thereof to Tenant, setting forth, in reasonable detail, the basis
therefor, no Landlord Default shall be deemed to have occurred and Landlord
shall have no obligation with respect thereto until final adverse determination
thereof; provided, however, that in the event of any such adverse determination,
Landlord shall pay to Tenant interest on any disputed funds at the Interest
Rate, from the date demand for such funds was made by Tenant until the date of
final adverse determination and, thereafter, at the Overdue Rate until paid. If
Tenant and Landlord shall fail, in good faith, to resolve any such dispute
within ten (10) days after Landlord's Notice of dispute, either may submit the
matter for resolution to a court of competent jurisdiction.
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ARTICLE 15
PURCHASE RIGHTS
15.1 First Refusal to Purchase. Provided, (a) no Default or Event of
Default shall have occurred and be continuing, (b) this Agreement shall be of
full force and effect, and (c) other than as expressly permitted or required by
Section 16, Tenant shall not have assigned this Agreement (other than a
collateral assignment to or from a Leasehold Mortgagee or as contemplated by
Section 16.5) or subleased all or any portion of the Leased Property, Tenant
shall have a first refusal option to purchase the Leased Property upon the same
price, terms and conditions as Landlord shall propose to sell the Leased
Property, or upon the same price, terms and conditions of any offer from a third
party to purchase the Leased Property which Landlord intends to accept (or has
accepted subject to Tenant's right of first refusal herein provided); provided,
however, that, if the proposed purchase price is for other than cash, Tenant
shall have the right to purchase the Leased Property on cash equivalent terms
determined by the agreement of the parties or, if they cannot agree within ten
(10) Business Days, by arbitration in accordance with the rules of the American
Arbitration Association then in effect. If, during the Term, Landlord reaches
such agreement with a third party or proposes to offer the Leased Property for
sale, Landlord shall promptly give written notice to Tenant of the purchase
price and all other material terms and conditions of such agreement or proposed
sale and Tenant shall have sixty (60) days thereafter to exercise Tenant's
option to purchase by written notice to Landlord thereof. Failure of Tenant to
respond within such 60-day period shall be deemed a waiver of Tenant's right to
purchase the Leased Property with respect to such offer pursuant to this Section
15.1. If Tenant exercises its option, the sale to Tenant shall be consummated
upon the same terms and conditions as contained in such agreement or Landlord's
notice of the proposed sale. If Tenant shall not exercise its option to purchase
within the time period and in the manner above provided, Landlord shall be free
to sell the Leased Property to such third party at the price and upon terms
substantially similar to those offered to Tenant. The rights granted to Tenant
pursuant to this Section 15.1 shall not apply to any financing or sale-leaseback
transaction or any transaction pursuant to which Landlord is merged or
consolidated with another Person; provided, however, that any Person who shall
acquire the Leased Premises shall acquire them subject to, and shall be bound
by, the provisions of this Section 15.1. The provisions of this Section 15.1
shall inure to the benefit of Tenant and any permitted successors and assigns of
Tenant pursuant to this Agreement.
15.2 Landlord's Option to Purchase the Tenant's Personal
Property; Transfer of Licenses. Landlord shall have the option to
purchase Tenant's Personal Property, at the expiration or
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termination of this Agreement, for an amount equal to the then net market value
thereof (current replacement cost as determined by appraisal less accumulated
depreciation on Tenant's books pertaining thereto), subject to, and with
appropriate price adjustments for, all equipment leases, conditional sale
contracts, UCC-1 financing statements and other encumbrances to which such
Personal Property is subject. Upon the expiration or sooner termination of this
Agreement, Tenant shall use its best efforts to transfer and assign to Landlord
or its designee, or assist Landlord or its designee in obtaining, any contracts,
licenses, and certificates required for the then operation of the Leased
Property.
ARTICLE 16
SUBLETTING AND ASSIGNMENT
16.1 Subletting and Assignment. Except as provided in Section 16.3 and
Article 19, Tenant shall not, without Landlord's prior written consent (which
consent may be given or withheld in Landlord's sole and absolute discretion),
assign, mortgage, pledge, hypothecate, encumber or otherwise transfer this
Agreement or sublease (which term shall be deemed to include the granting of
concessions, licenses and the like), all or any part of the Leased Property or
suffer or permit this Agreement or the leasehold estate created hereby or any
other rights arising under this Agreement to be assigned, transferred,
mortgaged, pledged, hypothecated or encumbered, in whole or in part, whether
voluntarily, involuntarily or by operation of law, or permit the use or
operation of the Leased Property by anyone other than Tenant and the Manager, or
the Leased Property to be offered or advertised for assignment or subletting.
For purposes of this Section 16.1, an assignment of this Agreement shall be
deemed to include any direct or indirect transfer of any interest in Tenant such
that Tenant shall cease to be a wholly owned direct or indirect Subsidiary of
Wyndham or any transaction pursuant to which Tenant is merged or consolidated
with another Entity or pursuant to which all or substantially all of Tenant's
assets are transferred to any other Entity, as if such change in control or
transaction were an assignment of this Agreement; provided, however, that the
foregoing shall not be construed to prohibit collateral assignments or pledges
of the capital stock of Tenant to Lending Institutions otherwise permitted by
this Agreement.
If this Agreement is assigned or if the Leased Property or any part
thereof are sublet (or occupied by anybody other than Tenant, the Manager and
their respective employees or hotel guests) Landlord may collect the rents from
such assignee, subtenant or occupant, as the case may be, and apply the net
amount collected to the Rent herein reserved, but no such collection shall be
deemed a waiver of the provisions set forth in
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the first paragraph of this Section 16.1, the acceptance by Landlord of such
assignee, subtenant or occupant, as the case may be, as a tenant, or a release
of Tenant from the future performance by Tenant of its covenants, agreements or
obligations contained in this Agreement.
No subletting or assignment shall in any way impair the continuing
primary liability of Tenant hereunder (unless Landlord and Tenant expressly
otherwise agree that Tenant shall be released from all obligations hereunder),
and no consent to any subletting or assignment in a particular instance shall be
deemed to be a waiver of the prohibition set forth in this Section 16.1. No
assignment, subletting or occupancy shall affect any Permitted Use. Any
subletting, assignment or other transfer of Tenant's interest under this
Agreement in contravention of this Section 16.1 shall be voidable at Landlord's
option.
16.2 Required Sublease Provisions. Any sublease of all or any portion
of the Leased Property entered into on or after the date hereof shall provide
(a) that it is subject and subordinate to this Agreement and to the matters to
which this Agreement is or shall be subject or subordinate; (b) that in the
event of termination of this Agreement or reentry or dispossession of Tenant by
Landlord under this Agreement, Landlord may, at its option, terminate such
sublease or take over all of the right, title and interest of Tenant, as
sublessor under such sublease, and such subtenant shall, at Landlord's option,
attorn to Landlord pursuant to the then executory provisions of such sublease,
except that neither Landlord nor any Hotel Mortgagee, as holder of a mortgage or
as Landlord under this Agreement, if such mortgagee succeeds to that position,
shall (i) be liable for any act or omission of Tenant under such sublease, (ii)
be subject to any credit, counterclaim, offset or defense which theretofore
accrued to such subtenant against Tenant, (iii) be bound by any previous
modification of such sublease not consented to in writing by Landlord or by any
previous prepayment of more than one (1) month's Rent, (iv) be bound by any
covenant of Tenant to undertake or complete any construction of the Leased
Property or any portion thereof, (v) be required to account for any security
deposit of the subtenant other than any security deposit actually delivered to
Landlord by Tenant, (vi) be bound by any obligation to make any payment to such
subtenant or grant any credits, except for services, repairs, maintenance and
restoration provided for under the sublease that are performed after the date of
such attornment, (vii) be responsible for any monies owing by Tenant to the
credit of such subtenant, or (viii) be required to remove any Person occupying
any portion of the Leased Property; and (c), in the event that such subtenant
receives a written Notice from Landlord or any Hotel Mortgagee stating that an
Event of Default has occurred and is continuing, such subtenant shall thereafter
be obligated to pay all rentals accruing under such sublease directly to the
party giving such
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Notice or as such party may direct. All rentals received from such subtenant by
Landlord or the Hotel Mortgagee, as the case may be, shall be credited against
the amounts owing by Tenant under this Agreement and such sublease shall provide
that the subtenant thereunder shall, at the request of Landlord, execute a
suitable instrument in confirmation of such agreement to attorn. An original
counterpart of each such sublease and assignment and assumption, duly executed
by Tenant and such subtenant or assignee, as the case may be, in form and
substance reasonably satisfactory to Landlord, shall be delivered promptly to
Landlord and (a) in the case of an assignment, the assignee shall assume in
writing and agree to keep and perform all of the terms of this Agreement on the
part of Tenant to be kept and performed and shall be, and become, jointly and
severally liable with Tenant for the performance thereof and (b) in case of
either an assignment or subletting, Tenant shall remain primarily liable, as
principal rather than as surety, for the prompt payment of the Rent and for the
performance and observance of all of the covenants and conditions to be
performed by Tenant hereunder.
The provisions of this Section 16.2 shall not be deemed a waiver of the
provisions set forth in the first paragraph of Section 16.1.
16.3 Permitted Sublease. Notwithstanding the foregoing, including,
without limitation, Section 16.2, but subject to the provisions of Section 16.4
and any other express conditions or limitations set forth herein, Tenant may, in
each instance after Notice to Landlord, sublease space at the Leased Property
for newsstand, gift shop, parking garage, health club, restaurant, bar or
commissary purposes or similar concessions in furtherance of the Permitted Use,
so long as such subleases do not demise, in the aggregate, in excess of two
thousand (2,000) square feet, will not violate or affect any Legal Requirement
or Insurance Requirement, and Tenant shall provide such additional insurance
coverage applicable to the activities to be conducted in such subleased space as
Landlord and any Hotel Mortgagee may reasonably require.
16.4 Sublease Limitation. For so long as Landlord or any Affiliated
Person as to Landlord shall seek to qualify as a real estate investment trust,
anything contained in this Agreement to the contrary notwithstanding, Tenant
shall not sublet the Leased Property on any basis such that the rental to be
paid by any sublessee thereunder would be based, in whole or in part, on the
income or profits derived by the business activities of such sublessee, any
other formula such that any portion of such sublease rental would fail to
qualify as "rents from real property" within the meaning of Section 856(d) of
the Code, or any similar or successor provision thereto or would otherwise
disqualify Landlord for treatment as a real estate investment trust.
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ARTICLE 17
ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS
17.1 Estoppel Certificates. At any time and from time to time, upon not
less than ten (10) Business Days prior Notice by either party, the party
receiving such Notice shall furnish to the other an Officer's Certificate
certifying that this Agreement is unmodified and in full force and effect (or
that this Agreement is in full force and effect as modified and setting forth
the modifications), the date to which the Rent has been paid, that no Default or
an Event of Default has occurred and is continuing or, if a Default or an Event
of Default shall exist, specifying in reasonable detail the nature thereof, and
the steps being taken to remedy the same, and such additional information as the
requesting party may reasonably request. Any such certificate furnished pursuant
to this Section 17.1 may be relied upon by the requesting party, its lenders and
any prospective purchaser or mortgagee of the Leased Property or the leasehold
estate created hereby.
17.2 Financial Statements.
(a) within forty-five (45) days after each of the first three
quarters of any Fiscal Year, the most recent Consolidated Financials,
accompanied by the Financial
Officer's Certificate;
(b) within ninety (90) days after the end of each Fiscal Year,
the most recent Consolidated Financials for such year, certified by an
independent certified public accountant reasonably satisfactory to
Landlord and accompanied by a Financial Officer's Certificate;
(c) within thirty (30) days after the end of each month, an
unaudited operating statement, including occupancy percentages and
average rate, accompanied by a Financial Officer's Certificate;
(d) promptly after the sending or filing thereof, copies of
all reports which Tenant or Wyndham sends to its security holders
generally, and copies of all periodic reports which Tenant or Wyndham
files with the SEC or any stock exchange on which its shares are listed
or traded;
(e) at any time and from time to time upon not less than
twenty (20) days Notice from Landlord, any Consolidated Financials or
any other financial reporting information required to be filed by
Landlord with any securities and exchange commission, the SEC or any
successor agency, or any
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other governmental authority, or required pursuant to any order issued
by any court, governmental authority or arbitrator in any litigation to
which Landlord is a party, for purposes of compliance therewith; and
(f) promptly, upon Notice from Landlord, such other
information concerning the business, financial condition and affairs of
Tenant and Wyndham as Landlord reasonably may request from time to
time.
Landlord may at any time, and from time to time, provide any Hotel Mortgagee
with copies of any of the foregoing statements.
In addition, Landlord shall have the right, from time to time at
Landlord's sole cost and expense, upon reasonable Notice, during Tenant's
customary business hours, to cause Tenant's books and records with respect to
the Leased Property to be audited by auditors selected by Landlord at the place
where such books and records are customarily kept.
17.3 General Operations. Tenant shall furnish to Landlord:
(a) Within thirty (30) days after receipt or modification
thereof, copies of all licenses authorizing Tenant and/or the Manager
to operate the Hotel for its Permitted Use;
(b) Not less than thirty (30) days after the commencement of
any Fiscal Year, proposed annual income and ordinary expense and
capital improvement budgets setting forth projected income and costs
and expenses projected to be incurred by Tenant in managing, owning,
maintaining and operating the Hotel during the next succeeding Fiscal
Year; and
(c) Promptly after receipt or sending thereof, copies
of all notices given or received by Tenant under the
Management Agreement.
ARTICLE 18
LANDLORD'S RIGHT TO INSPECT
Tenant shall permit, and shall direct the Manager to permit, Landlord
and its authorized representatives to inspect the Leased Property during usual
business hours upon not less than twenty-four (24) hours' notice and to make
such repairs as Landlord is permitted or required to make pursuant to the terms
of this Agreement, provided that any inspection or repair by Landlord or its
representatives will not unreasonably interfere with Tenant's use and operation
of the Leased Property and further provided
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that in the event of an emergency, as determined by Landlord in its reasonable
discretion, prior Notice shall not be necessary.
ARTICLE 19
LEASEHOLD MORTGAGES
19.1 Leasehold Mortgages Authorized. Notwithstanding anything to the
contrary contained herein, on one or more occasions, without Landlord's prior
consent, Tenant may grant one or more Leasehold Mortgages on its leasehold
interest in the Security Deposit, the Leased Property and security interests in
Tenant's rights to the FF&E Reserve and Tenant's Personal Property
(collectively, the "Leasehold Estate") to one or more Lending Institutions to
secure Indebtedness permitted hereunder.
19.2 Notices to Landlord. Promptly upon the granting of any Leasehold
Mortgage, Tenant or the applicable Leasehold Mortgagee shall give Notice thereof
to Landlord, such notice to identify the name and address of the Leasehold
Mortgagee and to be accompanied by a copy of the applicable Leasehold Mortgage,
as recorded. In the event of a change of address of a Leasehold Mortgagee or of
any amendment to or assignment of a Leasehold Mortgage, Tenant or the applicable
Leasehold Mortgagee shall promptly provide notice of such new address, amendment
or assignment to Landlord, together with a copy of each such amendment or
assignment.
19.3 Cure by Leasehold Mortgagee. Any Leasehold Mortgagee shall have
the right, at any time during the Term hereof, while this Agreement is in full
force and effect:
(a) To do any act required by Tenant hereunder, and all such
acts done or performed shall be effective as to prevent a forfeiture of
Tenant's rights hereunder as if the same had been done or performed by
Tenant; and
(b) To rely on the security afforded by the Leasehold Estate,
and to acquire and to succeed to the interest of Tenant hereunder by
foreclosure, whether by judicial sale, by power of sale contained in
any security instrument, or by assignment of leasehold interest given
in lieu of foreclosure, and thereafter convey or assign title to the
Leasehold Estate so required to any other person, firm or corporation.
If the Leasehold Mortgagee or Tenant shall have furnished, in writing,
to Landlord a request for Notice of any Event of Default, in the event of any
Event of Default by Tenant, Landlord will not terminate this Lease by reason of
such Event of Default if the Leasehold Mortgagee shall, prior to the expiration
of the
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applicable cure period, cure any monetary Event of Default or, if such Event of
Default cannot be cured by the payment of money, provide Landlord with a written
undertaking, in form and substance satisfactory to Landlord, to perform all
covenants and obligations of Tenant under this Agreement upon foreclosure and,
thereafter, such Leasehold Mortgagee shall proceed in a timely and diligent
manner to accomplish the foreclosure of the Leasehold Estate.
19.4 Landlord Estoppel Certificates. Landlord agrees, from time to
time, to provide to any Leasehold Mortgagee, promptly after written request
therefor, an estoppel certificate substantially in the form of Exhibit C or
otherwise in such form as any Leasehold Mortgagee may reasonably request.
ARTICLE 20
HOTEL MORTGAGES
20.1 Landlord May Grant Liens. Without the consent of Ten ant, Landlord
may, subject to the terms and conditions set forth in this Section 20.1, from
time to time, directly or indirectly, create or otherwise cause to exist any
lien, encumbrance or title retention agreement ("Encumbrance") upon the Leased
Property, or any portion thereof or interest therein, whether to secure any
borrowing or other means of financing or refinancing. Notwithstanding anything
to the contrary set forth in Section 20.2, any such Encumbrance shall include
the right to prepay (whether or not subject to a prepayment penalty) and shall
provide (subject to Section 20.2) that it is subject to the rights of Tenant
under this Agreement.
20.2 Subordination of Lease. Subject to Section 20.1 and this Section
20.2, this Agreement, any and all rights of Tenant hereunder, are and shall be
subject and subordinate to any ground or master lease, and all renewals,
extensions, modifications and replacements thereof, and to all mortgages and
deeds of trust, which may now or hereafter affect the Leased Property or any
improvements thereon and/or any of such leases, whether or not such mortgages or
deeds of trust shall also cover other lands and/or buildings and/or leases, to
each and every advance made or hereafter to be made under such mortgages and
deeds of trust, and to all renewals, modifications, replacements and extensions
of such leases and such mortgages and deeds of trust and all consolidations of
such mortgages and deeds of trust. This section shall be self-operative and no
further instrument of subordination shall be required provided that Tenant has
received a nondisturbance and attornment agreement from each Superior Mortgagee
and/or Superior Landlord, consistent with the provisions of this Section 20.2
and otherwise in form and substance reasonably satisfactory to Tenant, the
benefits of
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which agreement shall also extend to any Leasehold Mortgagee. In confirmation of
such subordination, Tenant shall promptly execute, acknowledge and deliver any
instrument that Landlord, the lessor under any such lease or the holder of any
such mortgage or the trustee or beneficiary of any deed of trust or any of their
respective successors in interest may reasonably request to evidence such
subordination. Any lease to which this Agreement is, at the time referred to,
subject and subordinate is herein called "Superior Lease" and the lessor of a
Superior Lease or its successor in interest at the time referred to, is herein
called "Superior Landlord" and any mortgage or deed of trust to which this
Agreement is, at the time referred to, subject and subordinate, is herein called
"Superior Mortgage" and the holder, trustee or beneficiary of a Superior
Mortgage is herein called "Superior Mortgagee". Tenant shall have no obligations
under any Superior Lease or Superior Mortgage other than those expressly set
forth in this Section 20.2.
If any Superior Landlord or Superior Mortgagee or the nominee or
designee of any Superior Landlord or Superior Mortgagee shall succeed to the
rights of Landlord under this Agreement (any such person, "Successor Landlord"),
whether through possession or foreclosure action or delivery of a new lease or
deed, or otherwise, such Successor Landlord shall recognize Tenant's rights
under this Agreement as herein provided and Tenant shall attorn to and recognize
the Successor Landlord as Tenant's landlord under this Agreement and Tenant
shall promptly execute and deliver any instrument that such Successor Landlord
may reasonably request to evidence such attornment (provided that such
instrument does not alter the terms of this Agreement), whereupon, this
Agreement shall continue in full force and effect as a direct lease between the
Successor Landlord and Tenant upon all of the terms, conditions and covenants as
are set forth in this Agreement, except that the Successor Landlord (unless
formerly the landlord under this Agreement or its nominee or designee) shall not
be (a) liable in any way to Tenant for any act or omission, neglect or default
on the part of any prior Landlord under this Agreement, (b) responsible for any
monies owing by or on deposit with any prior Landlord to the credit of Tenant
(except to the extent actually paid or delivered to the Successor Landlord), (c)
subject to any counterclaim or setoff which theretofore accrued to Tenant
against any prior Landlord, (d) bound by any modification of this Agreement
subsequent to such Superior Lease or Mortgage, or by any previous prepayment of
Minimum Rent or Additional Rent for more than one (1) month in advance of the
date due hereunder, which was not approved in writing by the Superior Landlord
or the Superior Mortgagee thereto, (e) liable to Tenant beyond the Successor
Landlord's interest in the Leased Property and the rents, income, receipts,
revenues, issues and profits issuing from the Leased Property, (f) responsible
for the performance of any work to be done by the Landlord under this Agreement
to render the Leased Property ready
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for occupancy by Tenant (subject to Landlord's obligations under Section
5.1.2(b) or with respect to any insurance or Condemnation proceeds), or (g)
required to remove any Person occupying the Leased Property or any part thereof,
except if such person claims by, through or under the Successor Landlord. Tenant
agrees at any time and from time to time to execute a suitable instrument in
confirmation of Tenant's agreement to attorn, as aforesaid and Landlord agrees
to provide Tenant with an instrument of nondisturbance and attornment from each
such Superior Mortgagee and Superior Landlord in form and substance reasonably
satisfactory to Tenant. Nothing contained in this Section 20.2 shall relieve
Landlord from any liability to Tenant under this Agreement following the
exercise of remedies by a Superior Mortgagee.
20.3 Notice to Mortgagee and Superior Landlord. Subsequent to the
receipt by Tenant of Notice from Landlord as to the identity of any Hotel
Mortgagee or Superior Landlord under a lease with Landlord, as ground lessee,
which includes the Leased Property as part of the demised premises and which
complies with Section 20.1 and 20.2 (which Notice shall be accompanied by a copy
of the applicable mortgage or lease), no notice from Tenant to Landlord as to
the Leased Property shall be effective unless and until a copy of the same is
given to such Hotel Mortgagee or Superior Landlord at the address set forth in
the above described Notice, and the curing of any of Landlord's defaults by such
Hotel Mortgagee or Superior Landlord shall be treated as performance by
Landlord.
ARTICLE 21
ADDITIONAL COVENANTS OF TENANT
21.1 Prompt Payment of Indebtedness. Tenant shall (a) pay or cause to
be paid when due all payments of principal of and premium and interest on
Tenant's Indebtedness for money borrowed and shall not permit or suffer any such
Indebtedness to become or remain in default beyond any applicable grace or cure
period, (b) pay or cause to be paid when due all lawful claims for labor and
rents with respect to the Leased Property, (c) pay or cause to be paid when due
all trade payables and (d) pay or cause to be paid when due all other of
Tenant's Indebtedness upon which it is or becomes obligated, except, in each
case, other than that referred to in clause (a), to the extent payment is being
contested in good faith by appropriate proceedings in accordance with Article 8
and if Tenant shall have set aside on its books adequate reserves with respect
thereto in accordance with GAAP, if appropriate, or unless and until
foreclosure, distraint sale or other similar proceedings shall have been
commenced.
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21.2 Conduct of Business. Tenant shall not engage in any business other
than the leasing and operation of the Leased Property and shall do or cause to
be done all things necessary to preserve, renew and keep in full force and
effect and in good standing its corporate or partnership existence, as
applicable, and its rights and licenses necessary to conduct such business.
21.3 Maintenance of Accounts and Records. Tenant shall keep true
records and books of account of Tenant in which full, true and correct entries
will be made of dealings and transactions in relation to the business and
affairs of Tenant in accordance with GAAP, where applicable, Tenant shall apply
accounting principles in the preparation of the financial statements of Tenant
which, in the judgment of and the opinion of its independent public accountants,
are in accordance with GAAP, where applicable, except for changes approved by
such independent public accountants. Tenant shall provide to Landlord either in
a footnote to the financial statements delivered under Section 17.2 which relate
to the period in which such change occurs, or in separate schedules to such
financial statements, information sufficient to show the effect of any such
changes on such financial statements.
21.4 Notice of Litigation, Etc. Tenant shall give prompt Notice to
Landlord of any litigation or any administrative proceeding to which it may
hereafter become a party of which Tenant has notice or actual knowledge which
involves a potential uninsured liability equal to or greater than Two Hundred
Fifty Thousand Dollars ($250,000) or which, in Tenant's reasonable opinion, may
otherwise result in any material adverse change in the business, operations,
property, prospects, results of operation or condition, financial or other, of
Tenant. Forthwith upon Tenant obtaining knowledge of any Default, Event of
Default or any default or event of default under any agreement relating to
Indebtedness for money borrowed in an aggregate amount exceeding, at any one
time, Two Hundred Fifty Thousand Dollars ($250,000), or any event or condition
that would be required to be disclosed in a current report filed by Tenant on
Form 8-K or in Part II of a quarterly report on Form 10-Q if Tenant were
required to file such reports under the Securities Exchange Act of 1934, as
amended, Tenant shall furnish Notice thereof to Landlord specifying the nature
and period of existence thereof and what action Tenant has taken or is taking or
proposes to take with respect thereto.
21.5 Indebtedness of Tenant. Tenant shall not create, incur, assume or
guarantee, or permit to exist, or become or remain liable directly or indirectly
upon, any Indebtedness except the following:
(a) Indebtedness of Tenant to Landlord;
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(b) Indebtedness of Tenant for Impositions, to the extent that
payment thereof shall not at the time be required to be made in
accordance with the provisions of Article 8;
(c) Indebtedness of Tenant in respect of judgments or awards
(i) which have been in force for less than the applicable appeal period
and in respect of which execution thereof shall have been stayed
pending such appeal or review, or (ii) which are fully covered by
insurance payable to Tenant, or (iii) which are for an amount not in
excess of $250,000 in the aggregate at any one time outstanding and (x)
which have been in force for not longer than the applicable appeal
period, so long as execution is not levied thereunder or (y) in respect
of which an appeal or proceedings for review shall at the time be
prosecuted in good faith in accordance with the provisions of Article
8, and in respect of which execution thereof shall have been stayed
pending such appeal or review;
(d) unsecured borrowings of Tenant from its Affiliated Persons
which are by their terms expressly subordinate pursuant to a
Subordination Agreement to the payment and performance of Tenant's
obligations under this Agreement;
(e) Indebtedness for purchase money financing in accordance
with Section 21.9(a) and other operating liabilities incurred in the
ordinary course of Tenant's business;
(f) Deferred fees to the Manager as provided in the Management
Agreement, provided that such fees shall be, from and after the
occurrence of a Default or Event of Default, subordinate to all amounts
owing to Landlord; or
(g) Indebtedness of Wyndham secured by a Leasehold Mortgage or
otherwise guaranteed by Tenant.
21.6 Financial Condition of Tenant. Tenant shall at all times maintain
Tangible Net Worth (except as provided in the last clause of this sentence) in
an amount at least equal to the aggregate of one year's Minimum Rent payable
pursuant to this Agreement; it being expressly understood and agreed that the
amount of the Security Deposit may for such purpose be counted as equity at the
full amount thereof.
21.7 Distributions, Payments to Affiliated Persons, Etc. Tenant shall
not declare, order, pay or make, directly or indirectly, any Distributions or
any payment to any Affiliated Person of Tenant (including payments in the
ordinary course of business and payments pursuant to management agreements with
any such Affiliated Person) or set apart any sum or property
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therefor, or agree to do so, if, at the time of such proposed action, or
immediately after giving effect thereto, any Event of Default shall exist.
21.8 Prohibited Transactions. Tenant shall not permit to exist or enter
into any agreement or arrangement whereby it engages in a transaction of any
kind with any Affiliated Person as to Tenant, except on terms and conditions
which are commercially reasonable or as otherwise provided in Section 21.5.
21.9 Liens and Encumbrances. Except as permitted by Section 7.1,
Article 19 and Section 21.5, Tenant shall not create or incur or suffer to be
created or incurred or to exist any Lien on this Agreement or any of Tenant's
assets, properties, rights or income, or any of its interest therein, now or at
any time hereafter owned, other than:
(a) Security interests securing the purchase price of
equipment or personal property whether acquired before or after the
Commencement Date; provided, however, that (i) such Lien shall at all
times be confined solely to the asset in question and (ii) the
aggregate principal amount of Indebtedness secured by any such Lien
shall not exceed the cost of acquisition or construction of the
property subject thereto;
(b) Permitted Encumbrances; and
(c) As permitted pursuant to Article 19 and Section 21.5.
21.10 Merger; Sale of Assets; Etc. Except as otherwise permitted by
this Agreement, Tenant shall not (i) sell, lease (as lessor or sublessor),
transfer or otherwise dispose of, or abandon, all or any material portion of its
assets (including capital stock) or business to any Person, (ii) merge into or
with or consolidate with any other Entity, or (iii) sell, lease (as lessor or
sublessor), transfer or otherwise dispose of, or abandon, any personal property
or fixtures or any real property; provided, however, that, notwithstanding the
provisions of clause (iii) preceding, Tenant may dispose of equipment or
fixtures which have become inadequate, obsolete, worn-out, unsuitable,
undesirable or unnecessary, provided substitute equipment or fixtures having
equal or greater value and utility (but not necessarily having the same
function) have been provided.
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ARTICLE 22
REPRESENTATIONS AND WARRANTIES
22.1 Representations of Tenant. To induce Landlord to enter into this
Agreement, Tenant represents and warrants to Landlord as follows:
22.1.1 Status and Authority of Tenant. Tenant is a corporation
duly organized, validly existing and in corporate good standing under the laws
of its state of incorporation. Tenant has all requisite power and authority
under the laws of its state of formation and its respective charter documents to
enter into and perform its obligations under this Agreement and to consummate
the transactions contemplated hereby. Tenant has duly qualified to transact
business in each jurisdiction in which the nature of the business conducted by
it requires such qualification.
22.1.2 Action of Tenant. Tenant has taken all necessary action
to authorize the execution, delivery and performance of this Agreement; this
Agreement constitutes the valid and binding obligation and agreement of Tenant,
enforceable against Tenant in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws of general application affecting the rights and
remedies of creditors.
22.1.3 No Violations of Agreements. Neither the execution,
delivery or performance of this Agreement by Tenant, nor compliance with the
terms and provisions hereof, will result in any breach of the terms, conditions
or provisions of, or conflict with or constitute a default under, or result in
the creation of any lien, charge or encumbrance upon Tenant or the Leased
Property pursuant to the terms of any indenture, mortgage, deed of trust, note,
evidence of indebtedness or any other material agreement or instrument by which
Tenant or, to Tenant's knowledge, the Leased Property is bound, other than a
Leasehold Mortgage.
22.1.4 Litigation. To Tenant's knowledge, no action or
proceeding is pending or threatened and no investigation looking toward such an
action or proceeding has begun, which questions the validity of this Agreement
or any action taken or to be taken pursuant hereto, will result in any material
adverse change in the business, operation, affairs or condition of the Leased
Property or Tenant, result in or subject the Leased Property or Tenant to a
material liability, or involves condemnation or eminent domain proceedings
against any part of the Leased Property.
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22.1.5 Existing Leases, Agreements, Etc. To Tenant's
knowledge, other than any agreements provided to Landlord prior to the date
hereof, there are no material agreements affecting the Leased Property which
will be binding on Landlord subsequent to the Commencement Date.
22.1.6 Disclosure. To Tenant's knowledge, there is no fact or
condition which materially and adversely affects the business or condition of
the Leased Property which has not been set forth in this Agreement or in the
other documents, certificates or statements furnished to Landlord in connection
with the transactions contemplated hereby.
22.1.7 Utilities, Etc. To Tenant's knowledge, all utilities
and services necessary for the use and operation of the Leased Property
(including, without limitation, road access, gas, water, electricity and
telephone) are available thereto, are of sufficient capacity to meet adequately
all needs and requirements necessary for the current use and operation of the
Leased Property and for its intended purposes. To Tenant's knowledge, no fact,
condition or proceeding exists which would result in the termination or material
impairment of the furnishing of such utilities to the Leased Property.
22.1.8 Compliance With Law. To Tenant's knowledge, the Leased
Property and the use and operation thereof do not violate any material federal,
state, municipal and other governmental statutes, ordinances, by-laws, rules,
regulations or any other legal requirements, including, without limitation,
those relating to construction, occupancy, zoning, adequacy of parking,
environmental protection, occupational health and safety and fire safety
applicable thereto; and there are presently in effect all material licenses,
permits and other authorizations necessary for the current use, occupancy and
operation thereof. To Tenant's knowledge, there is no threatened request,
application, proceeding, plan, study or effort which would materially adversely
affect the present use or zoning of the Leased Property or which would modify or
realign any adjacent street or highway in a manner which would materially
adversely affect the use and operation of the Leased Property.
22.1.9 Hazardous Substances. Except as disclosed to Landlord
in writing or as described in any environmental report delivered to Landlord, to
Tenant's knowledge, no tenant or other occupant or user of the Leased Property,
or any portion thereof, has stored or disposed of (or engaged in the business of
storing or disposing of) or has released or caused the release of any Hazardous
Substances, and, to Tenant's knowledge, except as disclosed to Landlord in
writing or as described in any environmental report delivered to Landlord, the
Leased Property is free from any such Hazardous Substances, except any such
materials maintained in accordance with Applicable Law.
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22.2 Representations of Landlord. To induce Tenant to enter in this
Agreement, Landlord represents and warrants to Tenant as follows:
22.2.1 Status and Authority of Landlord. Landlord is a
corporation duly organized, validly existing and in corporate good standing
under the laws of its state of incorporation. Landlord has all requisite power
and authority under the laws of its state of formation and its respective
charter documents to enter into and perform its obligations under this Agreement
and to consummate the transactions contemplated hereby. Landlord has duly
qualified to transact business in each jurisdiction in which the nature of the
business conducted by it requires such qualification.
22.2.2 Action of Landlord. Landlord has taken all necessary
action to authorize the execution, delivery and performance of this Agreement;
this Agreement constitutes the valid and binding obligation and agreement of
Landlord, enforceable against Landlord in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws of general application affecting the rights and
remedies of creditors.
22.2.3 No Violations of Agreements. Neither the execution,
delivery or performance of this Agreement by Landlord, nor compliance with the
terms and provisions hereof, will result in any material breach of the terms,
conditions or provisions of, or conflict with or constitute a default under, or
result in the creation of any lien, charge or encumbrance upon any material
property or assets of Landlord pursuant to the terms of any material indenture,
mortgage, deed of trust, note, evidence of indebtedness or any other agreement
or instrument by which Landlord is bound.
22.2.4 Litigation. No investigation, action or proceeding is
pending and, to Landlord's knowledge, no action or proceeding is threatened and
no investigation looking toward such an action or proceeding has begun, which
questions the validity of this Agreement or any action taken or to be taken
pursuant hereto.
22.3 Survival, Etc. The representations and warranties set forth in
Sections 22.1.5 shall remain in effect only for a one-year period after the date
hereof. Except as otherwise expressly provided in this Agreement, Tenant
disclaims the making of any representations or warranties, express or implied,
regarding the Leased Property or matters affecting the Leased Property, whether
made by Tenant, on Tenant's behalf or otherwise, including, without limitation,
the physical condition of the Leased Property, title to or the boundaries of the
Land, pest control
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matters, soil conditions, the presence, existence or absence of hazardous
wastes, toxic substances or other environmental matters, compliance with
building, health, safety, land use and zoning laws, regulations and orders,
structural and other engineering characteristics, traffic patterns, market data,
economic conditions or projections, and any other information pertaining to the
Leased Property or the market and physical environments in which it is located.
Landlord acknowledges (i) that Landlord has entered into this Agreement with the
intention of making and relying upon its own investigation or that of third
parties with respect to the physical, environmental, economic and legal
condition of the Leased Property and (ii) that Landlord is not relying upon any
statements, representations or warranties of any kind, other than those
specifically set forth in this Agreement or in any document to be delivered to
Landlord by Tenant. Landlord further acknowledges that it has not received from
or on behalf of Tenant any accounting, tax, legal, architectural, engineering,
property management or other advice with respect to this transaction and is
relying solely upon the advice of third party accounting, tax, legal,
architectural, engineering, property management and other advisors. Subject to
the provisions of this Agreement, Landlord shall purchase the Leased Property in
its "as is" condition on the date hereof.
ARTICLE 23
MISCELLANEOUS
23.1 Limitation on Payment of Rent. All agreements between Landlord and
Tenant herein are hereby expressly limited so that in no contingency or event
whatsoever, whether by reason of acceleration of Rent, or otherwise, shall the
Rent or any other amounts payable to Landlord under this Agreement exceed the
maximum permissible under applicable law, the benefit of which may be asserted
by Tenant as a defense, and if, from any circumstance whatsoever, fulfillment of
any provision of this Agreement, at the time performance of such provision shall
be due, shall involve transcending the limit of validity prescribed by law, or
if from any circumstances Landlord should ever receive as fulfillment of such
provision such an excessive amount, then, ipso facto, the amount which would be
excessive shall be applied to the reduction of the installment(s) of Minimum
Rent next due and not to the payment of such excessive amount. This provision
shall control every other provision of this Agreement and any other agreements
between Landlord and Tenant.
23.2 No Waiver. No failure by Landlord or Tenant to insist upon the
strict performance of any term hereof or to exercise any right, power or remedy
consequent upon a breach thereof, and no acceptance of full or partial payment
of Rent during the continuance of any such breach, shall constitute a waiver of
any
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such breach or of any such term. To the maximum extent permitted by law, no
waiver of any breach shall affect or alter this Agreement, which shall continue
in full force and effect with respect to any other then existing or subsequent
breach.
23.3 Remedies Cumulative. To the maximum extent permitted by law, each
legal, equitable or contractual right, power and remedy of Landlord or Tenant,
now or hereafter provided either in this Agreement or by statute or otherwise,
shall be cumulative and concurrent and shall be in addition to every other
right, power and remedy and the exercise or beginning of the exercise by
Landlord or Tenant (as applicable) of any one or more of such rights, powers and
remedies shall not preclude the simultaneous or subsequent exercise by Landlord
of any or all of such other rights, powers and remedies.
23.4 Severability. Any clause, sentence, paragraph, section or
provision of this Agreement held by a court of competent jurisdiction to be
invalid, illegal or ineffective shall not impair, invalidate or nullify the
remainder of this Agreement, but rather the effect thereof shall be confined to
the clause, sentence, paragraph, section or provision so held to be invalid,
illegal or ineffective, and this Agreement shall be construed as if such
invalid, illegal or ineffective provisions had never been contained therein.
23.5 Acceptance of Surrender. No surrender to Landlord of this
Agreement or of the Leased Property or any part thereof, or of any interest
therein, shall be valid or effective unless agreed to and accepted in writing by
Landlord and no act by Landlord or any representative or agent of Landlord,
other than such a written acceptance by Landlord, shall constitute an acceptance
of any such surrender.
23.6 No Merger of Title. It is expressly acknowledged and agreed that
it is the intent of the parties that there shall be no merger of this Agreement
or of the leasehold estate created hereby by reason of the fact that the same
Person may acquire, own or hold, directly or indirectly this Agreement or the
leasehold estate created hereby and the fee estate or ground landlord's interest
in the Leased Property.
23.7 Conveyance by Landlord. If Landlord or any successor owner of all
or any portion of the Leased Property shall convey all or any portion of the
Leased Property in accordance with the terms hereof other than as security for a
debt, and the grantee or transferee of such of the Leased Property shall
expressly assume all obligations of Landlord hereunder arising or accruing from
and after the date of such conveyance or transfer, Landlord or such successor
owner, as the case may be, shall, provided such successor owner shall have a
Tangible Net Worth of not less than Five Million Dollars ($5,000,000), (y) such
conveyance shall
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occur subsequent to the first anniversary of the Commencement Date and (z)
Landlord shall transfer in cash any unapplied balance of the Security Deposit to
such successor owner, thereupon be released from all future liabilities and
obligations of Landlord under this Agreement with respect to such of the Leased
Property arising or accruing from and after the date of such conveyance or other
transfer and all such future liabilities and obligations shall thereupon be
binding upon the new owner.
23.8 Quiet Enjoyment. Provided that no Event of Default shall have
occurred and be continuing, Tenant shall peaceably and quietly have, hold and
enjoy the Leased Property for the Term, free of hindrance or molestation by
Landlord or anyone claiming by, through or under Landlord, but subject to (a)
any Encumbrance permitted under Article 20 or otherwise permitted to be created
by Landlord hereunder provided that the holder of such Encumbrance has, to the
extent appropriate, executed a nondisturbance agreement pursuant to Section 20.2
or a subordination agreement in form and substance reasonably acceptable to
Tenant, (b) all Permitted Encumbrances, (c) liens as to obligations of Landlord
that are either not yet due or which are being contested in good faith and by
proper proceedings, provided the same do not materially interfere with Tenant's
ability to operate the Hotel and (d) liens that have been consented to in
writing by Tenant. Except as otherwise provided in this Agreement, no failure by
Landlord to comply with the foregoing covenant shall give Tenant any right to
cancel or terminate this Agreement or ▇▇▇▇▇, reduce or make a deduction from or
offset against the Rent or any other sum payable under this Agreement, or to
fail to perform any other obligation of Tenant hereunder.
23.9 Memorandum of Lease. Neither Landlord nor Tenant shall record this
Agreement. However, Landlord and Tenant shall promptly, upon the request of the
other, enter into a short form memorandum of this Agreement, in form suitable
for recording under the laws of the State in which reference to this Agreement,
and all options contained herein, shall be made. The parties shall share equally
all costs and expenses of recording such memorandum.
23.10 Notices.
(a) Any and all notices, demands, consents, approvals, offers,
elections and other communications required or permitted under this
Agreement shall be deemed adequately given if in writing and the same
shall be delivered either in hand, by telecopier with written
acknowledgment of receipt, or by mail or Federal Express or similar
expedited commercial carrier, addressed to the recipient of the notice,
postpaid and registered or certified with return
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receipt requested (if by mail), or with all freight charges prepaid (if
by Federal Express or similar carrier).
(b) All notices required or permitted to be sent hereunder
shall be deemed to have been given for all purposes of this Agreement
upon the date of acknowledged receipt, in the case of a notice by
telecopier, and, in all other cases, upon the date of receipt or
refusal, except that whenever under this Agreement a notice is either
received on a day which is not a Business Day or is required to be
delivered on or before a specific day which is not a Business Day, the
day of receipt or required delivery shall automatically be extended to
the next Business Day.
(c) All such notices shall be addressed,
if to Landlord to:
c/o Hospitality Properties Trust
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇
[Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇]
with a copy to:
▇▇▇▇▇▇▇▇ & Worcester LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
[Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇]
if to Tenant to:
c/o Wyndham Hotel Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
[Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇]
with a copy to:
Locke, Purnell, Rain, ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: J. ▇▇▇▇▇▇▇▇ ▇▇▇▇, Esq.
[Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇]
(d) By notice given as herein provided, the parties hereto and
their respective successor and assigns shall have the right from time
to time and at any time during the term of this Agreement to change
their respective addresses effective upon receipt by the other parties
of such notice
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and each shall have the right to specify as its address any other
address within the United States of America.
23.11 Trade Area Restriction. Neither Tenant nor any of its Affiliated
Persons shall own, build, franchise, manage or operate any full-service Wyndham
Hotel within the designated area on Exhibit D, at any time during the Term; it
being expressly understood and agreed that hotels other than Wyndham Hotels
(e.g. garden hotels or resort hotels) are not subject to the foregoing
restriction.
23.12 Construction. Anything contained in this Agreement to the
contrary notwithstanding, all claims against, and liabilities of, Tenant or
Landlord arising prior to any date of termination or expiration of this
Agreement with respect to the Leased Property shall survive such termination or
expiration. In no event shall Landlord be liable for any consequential damages
suffered by Tenant as the result of a breach of this Agreement by Landlord.
Neither this Agreement nor any provision hereof may be changed, waived,
discharged or terminated except by an instrument in writing signed by the party
to be charged. All the terms and provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Each term or provision of this Agreement to be performed
by Tenant shall be construed as an independent covenant and condition. Time is
of the essence with respect to the provisions of this Agreement. Except as
otherwise set forth in this Agreement, any obligations of Tenant (including
without limitation, any monetary, repair and indemnification obligations) and
Landlord shall survive the expiration or sooner termination of this Agreement.
23.13 Counterparts; Headings. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but which, when
taken together, shall constitute but one instrument and shall become effective
as of the date hereof when copies hereof, which, when taken together, bear the
signatures of each of the parties hereto shall have been signed. Headings in
this Agreement are for purposes of reference only and shall not limit or affect
the meaning of the provisions hereof.
23.14 Applicable Law, Etc. This Agreement shall be interpreted,
construed, applied and enforced in accordance with the laws of the State
applicable to contracts between residents of the State which are to be performed
entirely within the State, regardless of (i) where this Agreement is executed or
delivered; or (ii) where any payment or other performance required by this
Agreement is made or required to be made; or (iii) where any breach of any
provision of this Agreement occurs, or any cause of action otherwise accrues; or
(iv) where any action or other proceeding is instituted or pending; or (v) the
nationality,
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citizenship, domicile, principal place of business, or jurisdiction of
organization or domestication of any party; or (vi) whether the laws of the
forum jurisdiction otherwise would apply the laws of a jurisdiction other than
the State; or (vii) any combination of the foregoing.
To the maximum extent permitted by applicable law, any action to
enforce, arising out of, or relating in any way to, any of the provisions of
this Agreement may be brought and prosecuted in such court or courts located in
the State as is provided by law; and the parties consent to the jurisdiction of
said court or courts located in the State and to service of process by
registered mail, return receipt requested, or by any other manner provided by
law.
23.15 Special Landlord Option. GHALP Corporation, a Subsidiary of
Wyndham, currently leases eleven Wyndham Garden Hotel properties from HPTWN
Corporation, an Affiliated Person as to Landlord. Landlord shall have the right,
exercisable by notice given at any time on or before the fifth anniversary of
the Commencement Date, at Landlord's sole cost and expense, to require (a) that
Tenant enter into an amendment to this Agreement and cause GHALP Corporation to
enter into an amendment to its leases (collectively, the "GHALP Leases"),
providing (i) that any Event of Default under any GHALP Lease is an Event of
Default under this Agreement and that any Event of Default under this Agreement
is an Event of Default under the GHALP Leases; (ii) that GHALP Corporation may
not elect not to extend the term of the GHALP Leases for the Extended Terms (as
defined therein) unless Tenant elects not to extend the Term of this Agreement
for the Extended Terms and that Tenant may not elect not to extend the Term of
this Agreement for the Extended Terms unless GHALP Corporation elects not to
extend the term of its the GHALP Leases for the Extended Terms; and (iii) that
amounts (as defined therein) in the FF&E Reserve under this Agreement be pooled
and consolidated with amounts in the FF&E Reserve under the GHALP Leases; or (b)
that Tenant be merged into GHALP Corporation and that the GHALP Leases be
amended to designate this Agreement an "Other Lease" (as defined therein) under
the GHALP Leases and that this Agreement be amended accordingly. In the event
Landlord shall exercise either of the aforesaid options, Landlord and Tenant
shall enter into an amendment to this Agreement (and shall cause their
respective Affiliated Persons to enter into amendments to the GHALP Leases)
within thirty (30) days after Landlord's Notice to Tenant. The form and
substance of any such amendments shall be reasonably satisfactory to Landlord
and Tenant.
23.16 Nonrecourse. Nothing contained in this Agreement shall be
construed to impose any liabilities or obligations on Wyndham or any of its
shareholders for the payment or performance of the obligations or liabilities of
Tenant under this Agreement.
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23.17 Confidentiality. Except to prospective lenders and purchasers or
as may be required by law, the SEC or any securities and exchange commission,
Landlord shall not disclose any of Tenant's confidential or proprietary
information to any Person.
IN WITNESS WHEREOF, the parties have executed this Agreement as a
sealed instrument as of the date above first written.
LANDLORD:
HPTSLC CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Its President
TENANT:
WHC SALT LAKE CITY CORPORATION
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Authorized Signatory
EXHIBIT A
The Land
[See attached copy.]
EXHIBIT B
Approved Budget and Improvements
[See attached copy.]
EXHIBIT C
Form of Landlord Estoppel Certificate
[See attached copy.]
EXHIBIT D
Restricted Trade Area
[See attached copy.]
EXHIBIT E
Annual Minimum Rent
Minimum Rent is allocated as follows:
Portion of Annual Minimum Portion of Annual
Rent Allocated to Leased Minimum Rent
Real Property and Leased Allocated to Leased
Year Intangible Property Personal Property
1997 94.0% 6.0%
1998 95.5% 4.5%
1999 97.0% 3.0%
2000 98.5% 1.5%
2001 and beyond 100.0% 0%