Common use of Property Improvement Plan Clause in Contracts

Property Improvement Plan. Seller, at Seller’s sole cost and expense, shall complete all of the work described in Product Improvement Plan dated January 29, 2014 (the “2014 PIP”) and Seller shall provide Purchaser with written documentation from Licensor that Seller has completed the 2014 PIP promptly upon receipt from Licensor. (a) Seller, at Seller’s sole cost, shall order and ten (10) days prior to the expiration of the Study Period deliver to Purchaser a new property improvement plan (the “2015 PIP”) with respect to the sale of the Hotel to Purchaser. If the 2015 PIP requires any work, Seller shall provide written notice to Purchaser that Seller elects to: (a) complete the work; or (b) agree to provide Purchaser with a credit against the Purchase Price as provided herein. (b) In the event Seller elects to provide a credit at Closing in the amount of the estimated cost to complete the 2015 PIP, the estimated cost to complete the 2015 PIP shall be subject to Purchaser’s written approval. If Seller and Purchaser are unable to agree on the estimated cost to complete the 2015 PIP, then Seller and Purchaser shall each select a general contractor with at least 10 years of experience in performing hotel renovation work and each contractor shall prepare and deliver to the other a bid to complete the 2015 PIP. If each of the two bids is within 10% of the other, then the estimated cost to complete the 2015 PIP shall be the average of the two bids. If each of the two bids is 10% higher or lower than the other, then the two selected general contractors shall select a third general contractor (who must also have not less than 10 years of experience in performing hotel renovation work) and the third general contractor shall provide a bid. The estimated cost to complete the 2015 PIP shall be the arithmetical average of the three bids; provided, however, if either of the Seller’s or Purchaser’s general contractor’s bid is 10% higher or lower than the third general contractor’s bid, such bid shall be disregarded. The provisions of this Section 6.11 shall survive the Closing. Seller, at Seller’s sole cost, shall perform all obligations of Seller under the License Agreement for the period up to the Closing Date.

Property Improvement Plan. Seller(a) On the Closing Date, at Seller’s sole cost and expense, Hotel Owner shall complete all deliver to Administrative Agent a PIP Letter of Credit in the work described amount of $16,670,000. Attached hereto as Exhibit “L” is the property improvement plan for the Property set forth in Product Improvement Plan dated January 29, 2014 the Management Agreement (the “2014 PIPProperty Improvement Plan”). On or before the dates required pursuant to the Management Agreement, Operating Lessee shall cause the Property Improvement Plan to be performed and completed in a good and workmanlike manner, in material compliance with all applicable Laws and the Marriott Agreements and in each case in a manner reasonably satisfactory to Administrative Agent. Operating Lessee shall periodically (but not less frequently than quarterly) advise Administrative Agent as to the progress of the performance of the Property Improvement Plan, the costs incurred for same, the projected cost to completion of same and Seller the projected completion date for all matters. So long as no Default shall provide Purchaser have occurred and be continuing, upon the completion of the Property Improvement Plan, and provided Hotel Owner shall have delivered to Administrative Agent a certificate from Manager that the Property Improvement Plan has been completed in accordance with the terms of the Marriott Agreements and other reasonable evidence of such completion together with reasonable evidence that all costs thereof have been paid, either (i) the PIP Letter(s) of Credit (to the extent outstanding) shall be returned to Hotel Owner at its expense or (ii) if applicable, the balance remaining in the PIP Account shall either be (A) if no Cash Sweep Period is then in effect, disbursed to Hotel Owner in accordance with its written documentation instructions delivered to Administrative Agent or (B) if a Cash Sweep Period is then in effect, deposited into the Working Capital Reserve Account. Additionally, from Licensor time to time as Operating Lessee completes each element of the Property Improvement Plan (but not more frequently than monthly), provided that Seller (x) no Default shall have occurred and be continuing, (y) Hotel Owner is not required to take any action pursuant to the last sentence of this Section 2.33(a) that shall not have been performed and (z) Hotel Owner shall have delivered to Administrative Agent a certificate from Manager that such element of the Property Improvement Plan has been completed in accordance with the 2014 PIP promptly upon receipt from Licensor. (a) Sellerterms of the Management Agreement and other reasonable evidence of such completion together with reasonable evidence that all costs thereof have been paid and reasonable evidence of such costs, Administrative Agent shall, at SellerHotel Owner ’s sole costexpense, shall order make arrangements for the applicable PIP Letter of Credit to be reduced by the costs incurred by Operating Lessee to complete such element to Hotel Owner pursuant to an amendment to the applicable PIP Letter of Credit in form and content acceptable to Administrative Agent, less any additional projected costs for the Property Improvement Plan as provided in the following sentence. In the event that the projected cost of the Property Improvement Plan (as reasonably determined by Administrative Agent), including all changes thereto, cost overruns and additional charges, at any time exceeds the outstanding aggregate amount of the PIP Letters of Credit (or, if applicable, the balance of the funds on deposit in the PIP Account) by more than $500,000, Hotel Owner shall, within ten (10) days prior to Business Days after demand from Administrative Agent either make a deposit into the expiration of Cash Management Account (for deposit into the Study Period deliver to Purchaser a new property improvement plan (the “2015 PIP”PIP Account) with respect to the sale of the Hotel to Purchaser. If the 2015 PIP requires any work, Seller shall provide written notice to Purchaser that Seller elects to: (a) complete the work; or (b) agree to provide Purchaser with a credit against the Purchase Price as provided herein. (b) In the event Seller elects to provide a credit at Closing in the amount of the estimated cost to complete the 2015 PIPsuch excess, the estimated cost to complete the 2015 PIP shall be subject to Purchaser’s written approval. If Seller and Purchaser are unable to agree on the estimated cost to complete the 2015 PIP, then Seller and Purchaser shall each select a general contractor with at least 10 years of experience in performing hotel renovation work and each contractor shall prepare and deliver to Administrative Agent an additional PIP Letter of Credit in the other a bid amount of such excess or amend the existing PIP Letter of Credit to complete increase it by the 2015 PIP. If each amount of the two bids is within 10% of the other, then the estimated cost to complete the 2015 PIP shall be the average of the two bids. If each of the two bids is 10% higher or lower than the other, then the two selected general contractors shall select a third general contractor (who must also have not less than 10 years of experience in performing hotel renovation work) and the third general contractor shall provide a bid. The estimated cost to complete the 2015 PIP shall be the arithmetical average of the three bids; provided, however, if either of the Seller’s or Purchaser’s general contractor’s bid is 10% higher or lower than the third general contractor’s bid, such bid shall be disregarded. The provisions of this Section 6.11 shall survive the Closing. Seller, at Seller’s sole cost, shall perform all obligations of Seller under the License Agreement for the period up to the Closing Dateexcess.