Common use of Grant of Security Interests by Vistana Clause in Contracts

Grant of Security Interests by Vistana. A. Neither Vistana nor Parent shall, in connection with any financing entered into following the Effective Date: (i) transfer, assign, mortgage, or grant a security interest in, or pledge as collateral this Agreement, without the prior written consent of Starwood, which it may withhold in its sole discretion, and provided that such consent may be conditioned upon (a) the execution and delivery by the parties and the holder of such security interest of a lender letter, in the form attached hereto as Exhibit J-1, and (b) Vistana’s reimbursement to Starwood of its reasonable costs and expenses in connection with its review of such financing; or (ii) assign, mortgage, or grant a security interest in, or pledge as collateral any Ownership Interests in Vistana or any subsidiary of Vistana (and may not permit any Person Controlling Vistana to do the same), unless (a) the holder of such security interest is an Institutional Lender and not an Affiliate of Vistana or a Lodging Competitor or a Specially Designated National or Blocked Person, and (b) the parties and the holder of such security interest execute and deliver a lender letter, in the form attached hereto as Exhibit J-2. In addition, Vistana shall not permit any Person Controlling Vistana to assign, mortgage, or grant a security interest in, or pledge as collateral any Ownership Interests in, such Person unless the holder of such security interest is an Institutional Lender and is not an Affiliate of Vistana or a Lodging Competitor or a Specially Designated National or Blocked Person. Vistana and Parent shall promptly notify Starwood of any written default notices received by Vistana or Parent with respect to the financing referred to in this Section 18.5, to the extent the matters set forth in any such default notice could reasonably result in a remedy that would permit the respective lender to enforce the applicable assignment, mortgage, security interest or pledge. For the avoidance of doubt, Starwood has no obligation to provide any assurances to any lender in the form of a “comfort letter” or otherwise in connection with any financing transaction referred to in this Section 18.5 or otherwise grant its consent thereto. If a financing has been approved by Starwood under Section 18.5A(i) or Section 18.5A(ii) above, thereafter any such lender participating in such financing shall not subsequently assign, transfer, convey or sell participations in such financing to any Person other than an Institutional Lender that is not an Affiliate of Vistana, a Lodging Competitor or a Vacation Ownership Competitor, without the prior written consent of Starwood, which consent may be withheld in Starwood’s sole discretion. B. If a lender forecloses on, or otherwise exercises its rights against, the assets of the Licensed Business (including this Agreement), the revenues of the Licensed Business, or Ownership Interests in Vistana or Ownership Interests in any subsidiaries of Vistana, or Vistana or Parent violates this Section 18, Starwood will have the rights pursuant to Section 18.1, Section 19.1, Section 19.2 and Section 19.5 of this Agreement, as applicable, including, without limitation, the right to terminate this Agreement. Starwood has no obligation to license a lender, any successor to a lender, or any Person acting on behalf of a lender, including a receiver or servicer of a loan, the right to use the Licensed Marks or the Applicable System (or any aspect thereof) or any other Starwood Intellectual Property, unless that obligation arises from a valid and binding written agreement between Starwood and such party. C. Parent shall not require Starwood’s consent under this Section 18.5 to pledge as collateral Ownership Interests in Vistana and its subsidiaries pursuant to Parent’s existing financing arrangements (as such arrangements exist as of the Effective Date); provided that the parties and the holder of such security interest execute and deliver a lender letter, in the form attached hereto as Exhibit J-2.