FIRST AMENDED AND RESTATED MASTER LEASE AGREEMENT DATED AS OF NOVEMBER 26, 2002 BETWEEN HUMPHREY HOSPITALITY LIMITED PARTNERSHIP AND E & P FINANCING LIMITED PARTNERSHIP AS LESSOR AND TRS LEASING SUBSIDIARY, LLC AS LESSEE AND SOLOMONS BEACON INN...
Exhibit 10.8
FIRST AMENDED AND RESTATED
DATED AS OF NOVEMBER 26, 2002
BETWEEN
XXXXXXXX HOSPITALITY LIMITED PARTNERSHIP
AND
E & P FINANCING LIMITED PARTNERSHIP
AS LESSOR
AND
TRS LEASING SUBSIDIARY, LLC
AS LESSEE
AND
SOLOMONS BEACON INN LIMITED PARTNERSHIP
AS WITHDRAWING LESSOR
TABLE OF CONTENTS
ARTICLE I | 1 | |||
1.1 | Leased Property | 1 | ||
1.2 | Term | 2 | ||
ARTICLE II | 2 | |||
2.1 | Definitions | 2 | ||
ARTICLE III | 11 | |||
3.1 | Rent | 11 | ||
3.2 | Additional Charges | 12 | ||
3.3 | Lease Provision | 12 | ||
3.4 | Conversion of Property | 12 | ||
3.5 | Books and Records | 13 | ||
ARTICLE IV | 13 | |||
4.1 | Payment of Impositions | 13 | ||
4.2 | Notice of Impositions | 14 | ||
4.3 | Adjustment of Impositions | 14 | ||
4.4 | Maintenance | 14 | ||
4.5 | Insurance Premiums | 14 | ||
ARTICLE V | 14 | |||
5.1 | No Termination | 14 | ||
ARTICLE VI | 15 | |||
6.1 | Ownership of the Leased Property | 15 | ||
6.2 | Lessee’s Personal Property | 15 | ||
6.3 | Lessor’s Lien | 16 | ||
ARTICLE VII | 16 | |||
7.1 | Condition of the Leased Property | 16 | ||
7.2 | Use of the Leased Property | 17 | ||
7.3 | Lessor to Grant Easements, etc. | 18 | ||
ARTICLE VIII | 18 | |||
8.1 | Compliance with Legal and Insurance Requirements, etc. | 18 | ||
8.2 | Legal Requirement Covenants | 18 | ||
8.3 | Environmental Covenants | 19 | ||
ARTICLE IX | 21 | |||
9.1 | Capital Improvements, Maintenance and Repair | 21 | ||
9.2 | Encroachments, Restrictions, Etc. | 22 | ||
ARTICLE X | 22 | |||
10.1 | Alterations | 22 | ||
10.2 | Salvage | 23 | ||
10.3 | Joint Use Agreements | 23 | ||
ARTICLE XI | 23 | |||
11.1 | Liens | 23 | ||
ARTICLE XII | 23 | |||
12.1 | Permitted Contests | 23 | ||
ARTICLE XIII | 24 | |||
13.1 | General Insurance Requirements | 24 |
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13.2 | Replacement Cost | 26 | ||
13.3 | Worker’s Compensation | 26 | ||
13.4 | Waiver of Subrogation | 26 | ||
13.5 | Form Satisfactory, etc. | 26 | ||
13.6 | Change in Limits | 27 | ||
13.7 | Blanket Policy | 27 | ||
13.8 | Separate Insurance | 27 | ||
13.9 | Reports On Insurance Claims | 27 | ||
ARTICLE XIV | 27 | |||
14.1 | Insurance Proceeds | 27 | ||
14.2 | Reconstruction in the Event of Damage or Destruction Covered by Insurance | 28 | ||
14.3 | Reconstruction in the Event of Damage or Destruction Not Covered by Insurance | 29 | ||
14.4 | Lessee’s Property | 29 | ||
14.5 | Damage Near End of Term | 29 | ||
14.6 | Waiver | 29 | ||
ARTICLE XV | 30 | |||
15.1 | Definitions | 30 | ||
15.2 | Parties’ Rights and Obligations | 30 | ||
15.3 | Total Taking | 30 | ||
15.4 | Allocation of Award | 30 | ||
15.5 | Partial Taking | 30 | ||
15.6 | Temporary Taking | 31 | ||
15.7 | Lessee’s Offer | 31 | ||
ARTICLE XVI | 31 | |||
16.1 | Events of Default | 31 | ||
16.2 | Surrender | 32 | ||
16.3 | Damages | 33 | ||
16.4 | Waiver | 33 | ||
16.5 | Application of Funds | 34 | ||
ARTICLE XVII | 34 | |||
17.1 | Lessor’s Right to Cure Lessee’s Default | 34 | ||
ARTICLE XVIII | 34 | |||
18.1 | Provisions Relating to Purchase of the Leased Property | 34 | ||
ARTICLE XIX | 35 | |||
19.1 | Personal Property Limitation | 35 | ||
19.2 | Sublease Rent Limitation | 35 | ||
19.3 | Sublease Tenant Limitation | 35 | ||
19.4 | TRS Election and Limitations | 35 | ||
19.5 | Manager Officer and Employee Limitation | 36 | ||
ARTICLE XX | 37 | |||
20.1 | Holding Over | 37 | ||
ARTICLE XXI | 37 | |||
21.1 | Risk of Loss | 37 | ||
ARTICLE XXII | 37 | |||
22.1 | Indemnification | 37 | ||
ARTICLE XXIII | 38 |
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23.1 | Subletting and Assignment | 38 | ||
23.2 | Attornment | 38 | ||
ARTICLE XXIV | 39 | |||
24.1 | Officer’s Certificates; Lessor’s Estoppel Certificates and Covenants | 39 | ||
ARTICLE XXV | 39 | |||
25.1 | Lessor’s Right to Inspect | 39 | ||
ARTICLE XXVI | 39 | |||
26.1 | No Waiver | 39 | ||
ARTICLE XXVII | 40 | |||
27.1 | Remedies Cumulative | 40 | ||
ARTICLE XVIII | 40 | |||
28.1 | Acceptance of Surrender | 40 | ||
ARTICLE XXIX | 40 | |||
29.1 | No Merger of Title | 40 | ||
ARTICLE XXX | 40 | |||
30.1 | Conveyance by Lessor | 40 | ||
30.2 | Other Interests | 40 | ||
ARTICLE XXXI | 41 | |||
31.1 | Quiet Enjoyment | 41 | ||
ARTICLE XXXII | 41 | |||
32.1 | Notices | 41 | ||
ARTICLE XXXIII | 41 | |||
33.1 | Appraisers | 41 | ||
ARTICLE XXXIV | 42 | |||
34.1 | Lessor May Grant Liens | 42 | ||
34.2 | Lessee’s Right to Cure | 43 | ||
34.3 | Breach by Lessor | 43 | ||
ARTICLE XXXV | 43 | |||
35.1 | Miscellaneous | 43 | ||
35.2 | Transition Procedures | 43 | ||
35.3 | Waiver of Presentment, etc. | 44 | ||
ARTICLE XXXVI | 44 | |||
36.1 | Memorandum of Lease | 44 | ||
ARTICLE XXXVII | 44 | |||
37.1 | Lessor’s Option to Purchase Assets of Lessee | 44 | ||
ARTICLE XXXVIII | 45 | |||
38.1 | Lessor’s Option to Terminate Lease | 45 | ||
ARTICLE XXXIX | 45 | |||
39.1 | Compliance with Franchise Agreement | 45 | ||
ARTICLE XL | 46 | |||
40.1 | Room Set-Aside | 46 | ||
40.2 | Capital Expenditures | 46 | ||
40.3 | Prohibited Expenditures | 46 | ||
ARTICLE XLI | 47 | |||
41.1 | SBILP | 47 |
Exhibit A - Hotel Properties
Exhibit B - Excluded Properties
Schedule 1 to Exhibit B
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FIRST AMENDED AND RESTATED
THIS FIRST AMENDED AND RESTATED MASTER LEASE AGREEMENT (hereinafter called “Lease”), made as of the 26th day of November, 2002 by and between Xxxxxxxx Hospitality Limited Partnership, a Virginia limited partnership and E&P Financing Limited Partnership, a Maryland limited partnership (hereinafter called “Lessor”), and TRS Leasing Inc., a Virginia corporation (hereinafter called “Lessee”), provides as follows.
Lessor and Solomons Beacon Inn Limited Partnership, a Maryland limited partnership (hereinafter called “SBILP”), as lessor, and Lessee, as lessee, are the parties to that Master Lease Agreement dated as of January 1, 2002 (the “Original Lease”), pursuant to which Lessee leases the Leased Property and the Excluded Property (as such terms are hereinafter defined).
Lessor, Lessee and SBILP desire to amend and restate the Original Lease on the terms set forth herein in order, among other things, to reflect the withdrawal of SBILP as a party to the Original Lease and the exclusion of the Excluded Property from the property subject to the Original Lease, all effective as of the Commencement Date (as hereinafter defined).
Lessor owns fee title to, or a leasehold interest in, the Leased Property.
Lessor and Lessee wish to enter into this Lease which shall constitute a separate lease for each Leased Property.
ARTICLE I
(a) the land or ground leasehold interests described in Exhibit “A” attached hereto and by reference incorporated herein (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 offsite), parking areas and roadways appurtenant to such buildings and structures presently situated upon the Land (collectively, the “Leased Improvements”);
(c) all easements, rights and appurtenances relating to the Land or the Leased Improvements;
(d) all equipment, machinery, fixtures, and other items of property required for or incidental to the use of the Leased Improvements as a hotel, including all components thereof, now and 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 greatest extent permitted by law are hereby deemed by the parties hereto to constitute real estate, together with all replacements, modifications, alterations and additions thereto (collectively, the “Fixtures”);
(e) all furniture and furnishings and all other items of personal property (excluding Inventory and personal property owned by Lessee) located on, and used in connection with, the operation of the Leased Improvements as a hotel, together with all replacements, modifications, alterations and additions thereto; and
(f) all existing leases of space within the Leased Property (including any security deposits or collateral held by Lessor pursuant thereto).
THE LEASED PROPERTY IS DEMISED IN ITS PRESENT CONDITION WITHOUT REPRESENTATION OR WARRANTY (EXPRESSED OR IMPLIED) BY LESSOR AND SUBJECT TO THE RIGHTS OF PARTIES IN POSSESSION, AND TO THE EXISTING STATE OF TITLE INCLUDING ALL COVENANTS, CONDITIONS, RESTRICTIONS, EASEMENTS AND OTHER MATTERS OF RECORD INCLUDING ALL APPLICABLE LEGAL REQUIREMENTS, THE LIEN OF FINANCING INSTRUMENTS, MORTGAGES, DEEDS OF TRUST AND SECURITY DEEDS, AND INCLUDING OTHER MATTERS WHICH WOULD BE DISCLOSED BY AN INSPECTION OF THE LEASED PROPERTY OR BY AN ACCURATE SURVEY THEREOF.
ARTICLE II
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Additional Charges: As defined in Section 3.2.
Affiliate: As to any Person, (a) any other Person that, directly or indirectly, controls or is controlled by or is under common control with such Person, (b) any other Person that owns, beneficially, directly or indirectly, five percent or more of the outstanding capital stock, shares or equity interests of such Person, or (c) any officer, director, employee, partner or trustee of such Person or any Person controlling, controlled by or under common control with such Person (excluding trustees and Persons serving in similar capacities who are not otherwise an Affiliate of such Person). For the purposes of this definition, “control” (including the correlative meanings of the terms “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, through the ownership of voting securities, partnership interests or other equity interests.
Award: As defined in Section 15.1(c).
Base Rate: The rate of interest announced publicly by Citibank, N.A., in New York, New York, or any successor bank from time to time, as such bank’s base rate. If no such rate is announced or becomes discontinued, then such other rate as Lessor may reasonably designate.
Percentage Rent: As defined in Section 3.1(a).
Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on which national banks in the City of Washington, D.C., or in the municipality wherein the Leased Property is located, are closed.
Capitalization Date: The effective date, as determined by Lessor, of the transfer, directly or indirectly, by Lessor to Lessee of all of Lessor’s right, title and interest in and to all Furniture and Equipment and other items of personal property owned by Lessor and located on, and used in connection with, the operation of the Leased Improvements as a hotel.
CERCLA: The Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended.
Code: The Internal Revenue Code of 1986, as amended.
Commencement Date: As defined in Section 1.2.
Condemnation, Condemnor: As defined in Section XV.
Date of Taking: As defined in Section 15.1(b).
Encumbrance: As defined in Section XXXIV.
Environmental Authority: Any department, agency or other body or component of any Government that exercises any form of jurisdiction or authority under any Environmental Law.
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Environmental Authorization: Any license, permit, order, approval, consent, notice, registration, filing or other form of permission or authorization required under any Environmental Law.
Environmental Laws: All applicable federal, state, local and foreign laws and regulations relating to pollution of the environment (including without limitation, ambient air, surface water, ground water, land surface or subsurface strata), including without limitation laws and regulations relating to emissions, discharges, Releases or threatened Releases of Hazardous Materials or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials. Environmental Laws include but are not limited to CERCLA, FIFRA, RCRA, XXXX and TSCA.
Environmental Liabilities: Any and all obligations to pay the amount of any judgment or settlement, the cost of complying with any settlement, judgment or order for injunctive or other equitable relief, the cost of compliance or corrective action in response to any notice, demand or request from an Environmental Authority, the amount of any civil penalty or criminal fine, and any court costs and reasonable amounts for attorney’s fees, fees for witnesses and experts, and costs of investigation and preparation for defense of any claim or any Proceeding, regardless of whether such Proceeding is threatened, pending or completed, that may be or have been asserted against or imposed upon Lessor, Lessee, the Leased Property or any property used therein and arising out of:
(a) Failure of Lessee, or Lessor to comply at any time with all Environmental Laws;
(b) Presence of any Hazardous Materials on, in, under, at or in any way affecting the Leased Property;
(c) A Release at any time of any Hazardous Materials on, in, at, under or in any way affecting the Lease Property;
(d) Identification of Lessee or Lessor as a potentially responsible party under CERCLA or under any Environmental Law similar to CERCLA;
(e) Presence at any time of any above-ground and/or underground storage tanks, as defined in RCRA or in any applicable Environmental Law on, in, at or under the Leased Property; or
(f) Any and all claims for injury or damage to persons or property arising out of exposure to Hazardous Materials originating or located at the Leased Property, or resulting from operation thereof.
Event of Default: As defined in Section XVI.
Facility: The hotel and/or other facility offering lodging and other services or amenities being operated or proposed to be operated on the Leased Property.
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Fair Market Rental: The fair market rental of the Leased Property means the rental which a willing tenant not compelled to rent would pay a willing landlord not compelled to lease for the use and occupancy of such Leased Property pursuant to the Lease for the term in question, (a) assuming that Lessee is not in default thereunder and (b) determined in accordance with the appraisal procedures set forth in Article XXXIII or in such other manner as shall be mutually acceptable to Lessor and Lessee.
Fair Market Value: The fair market value of the Leased Property means an amount equal to the price that a willing buyer not compelled to buy would pay a willing seller not compelled to sell for such Leased Property, (a) assuming the same is unencumbered by this Lease, (b) determined in accordance with the appraisal procedures set forth in Article XXXIII or in such other manner as shall be mutually acceptable to Lessor and Lessee, (c) assuming that such seller must pay customary closing costs and title premiums, and (d) taking into account the positive or negative effect on the value of the Leased Property attributable to the interest rate, amortization schedule, maturity date, prepayment penalty and other terms and conditions of any encumbrance that is assumed by the transferee. In addition, in determining the Fair Market Value with respect to damaged or destroyed Leased Property such value shall be determined as if such Leased Property had not been so damaged or destroyed.
FIFRA: The Federal Insecticide, Fungicide, and Rodenticide Act, as amended.
Fiscal Year: The 12-month period from January 1 through December 31, except for the Fiscal Year ending December 31, 2002, which shall mean the period from the Commencement Date through December 31, 2002.
Fixtures: As defined in Section 1.1.
Franchise Agreement: Any franchise agreement or license agreement with a franchisor under which the Facility is operated.
Furniture and Equipment: Collectively, all carpet, furniture, furnishings, wall coverings, fixtures and hotel equipment and systems located at, or used in connection with, the Facility, together with all replacements therefor and additions thereto, including, without limitation, (i) all equipment and systems required for the operation of kitchens, bars, if any, restaurants, if any, and laundry and dry cleaning facilities, (ii) dining room wagons, materials handling equipment, cleaning and engineering equipment, (iii) telephone and computerized accounting systems, and (iv) vehicles.
Government: The United States of America, any state, district or territory thereof, any foreign nation, any state, district, department, territory or other political division thereof, or any political subdivision of any of the foregoing.
Gross Operating Expenses: All of the following with respect to the Facility: reasonable and customary salaries and employee expense and payroll taxes (including salaries, wages, bonuses and other compensation of all employees at the Facility, and benefits including life, medical and disability insurance and retirement benefits), expenditures described in Section IX, operational supplies, utilities, insurance to be provided by Lessee under the terms of this Agreement, governmental fees and assessments, food, beverages,
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laundry service expense, the cost of Inventories and fixed asset supplies, license fees, advertising, marketing, reservation systems and any and all other operating expenses as are reasonably necessary for the proper and efficient operation of the Facility incurred by Lessee in accordance with the provisions hereof (excluding, however, (i) federal, state and municipal excise, sales and use taxes collected directly from patrons and guests or as a part of the sales price of any goods, services or displays, such as gross receipts, admissions, cabaret or similar or equivalent taxes paid over to federal, state or municipal governments, (ii) the cost of insurance to be provided under Article XIII, (iii) expenditures by Lessor pursuant to Article XIII and (iv) payments on any Mortgage or other mortgage or security instrument on the Facility); all determined in accordance with generally accepted accounting principles and the Uniform System. No part of Lessee’s central office overhead or general or administrative expense (as opposed to that of the Facility) shall be deemed to be a part of Gross Operating Expenses, as herein provided. Reasonable out-of-pocket expenses of Lessee incurred for the account of or in connection with the Facility operations, including but not limited to postage, telephone charges and reasonable travel expenses of employees, officers and other representatives and consultants of Lessee and its Affiliates, shall be deemed to be a part of Gross Operating Expenses and such persons shall be afforded reasonable accommodations, food, beverages, laundry, valet and other such services by and at the Facility without charge to such persons or Lessee.
Gross Operating Profit: For any Fiscal Year, the excess of Gross Revenues for such Fiscal Year over Gross Operating Expenses for such Fiscal Year.
Gross Revenues: All revenues, receipts, and income of any kind derived directly or indirectly by Lessee from or in connection with the Facility (including rentals or other payments from tenants, lessees, licensees or concessionaires but not including their gross receipts unless such party is an Affiliate of the Lessee in which case the gross receipts shall be included) whether on a cash basis or credit, paid or collected, determined in accordance with generally accepted accounting principles and the Uniform System, excluding, however: (i) funds furnished by Lessor, (ii) federal, state and municipal excise, sales, and use taxes collected directly from patrons and guests or as a part of the sales price of any goods, services or displays, such as gross receipts, admissions, cabaret or similar or equivalent taxes and paid over to federal, state or municipal governments, (iii) gratuities, (iv) proceeds of insurance and condemnation, (v) proceeds from sales other than sales in the ordinary course of business, (vi) all loan proceeds from financing or refinancings of the Facility or interests therein or components thereof, (vii) judgments and awards, except any portion thereof arising from normal business operations of the hotel, and (viii) items constituting “allowances” under the Uniform System.
Hazardous Materials: All chemicals, pollutants, contaminants, wastes and toxic substances, including without limitation:
(a) Solid or hazardous waste, as defined in RCRA or in any Environmental Law;
(b) Hazardous substances, as defined in CERCLA or in any Environmental Law;
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(c) Toxic substances, as defined in TSCA or in any Environmental Law;
(d) Insecticides, fungicides, or rodenticides, as defined in FIFRA or in any Environmental Law; and
(e) Gasoline or any other petroleum product or byproduct, polychlorinated biphenols, asbestos and urea formaldehyde.
Hotel Property: All Furniture and Equipment and other personal property required to operate the Leased Property in the manner contemplated by this Lease from and after the Capitalization Date.
Impositions: Collectively, all taxes (including, without limitation, all ad valorem, sales and use, single business, gross receipts, transaction privilege, rent or similar taxes as the same relate to or are imposed upon Lessee or its business conducted upon the Leased Property) including Real Estate Taxes and Personal Property Taxes, assessments (including, without limitation, all assessments for public improvements or benefit, whether or not commenced or completed prior to the date hereof and whether or not to be completed within the Term), ground rents, water, sewer or other rents and charges, excises, tax 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 Lessee (including all interest and penalties thereon caused by any failure in payment by Lessee), which at any time prior to, during or with respect to the Term hereof may be assessed or imposed on or with respect to or be a lien upon (a) Lessor’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, (c) the Hotel Property, or (d) 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 Lessee.
Indemnified Party: Either of a Lessee Indemnified Party or a Lessor Indemnified Party.
Indemnifying Party: Any party obligated to indemnify an Indemnified Party pursuant to Section 8.3 or Article XXII.
Inventory: All “Inventories of Merchandise” and “Inventories of Supplies” as defined in the Uniform System, including, but not limited to, linens and other non-depreciable personal property.
Land: As defined in Article I.
Lease: This Lease.
Leased Improvements; Leased Property: Each as defined in Article I.
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Legal Requirements: All federal, state, county, municipal and other governmental statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and injunctions affecting either the Leased Property or the maintenance, construction, use or alteration thereof (whether by Lessee or otherwise), whether or not hereafter enacted and in force, including (a) all laws, rules or regulations pertaining to the environment, occupational health and safety and public health, safety or welfare, and (b) any laws, rules or regulations that may (1) require repairs, modifications or alterations in or to the Leased Property or (2) in any way adversely affect the use and enjoyment thereof; and all permits, licenses and authorizations and regulations relating thereto and all covenants, agreements, restrictions and encumbrances contained in any instruments, either of record or known to Lessee (other than encumbrances created by Lessor without the consent of Lessee), at any time in force affecting the Leased Property.
Lending Institution: Any insurance company, credit company, federally insured commercial or savings bank, national banking association, 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 $10,000,000.
Lessee: The Lessee designated on this Lease and its respective permitted successors and assigns.
Lessee Indemnified Party: Lessee, any Affiliate of Lessee, any other Person against whom any claim for indemnification may be asserted hereunder as a result of a direct or indirect ownership interest (including a stockholder’s interest) in Lessee, the officers, directors, stockholders, employees, agents and representatives of Lessee and any corporate stockholder, agent, or representative of Lessee, and the respective heirs, personal representatives, successors and assigns of any such officer, director, stockholder, employee, agent or representative.
Lessee’s Personal Property: As defined in Section 6.2.
Lessor: The Lessor designated on this Lease and its respective successors and assigns.
Lessor Indemnified Party: Lessor, any Affiliate of Lessor, any other Person against whom any claim for indemnification may be asserted hereunder as a result of a direct or indirect ownership interest (including a stockholder’s or partnership interest) in Lessor, the officers, directors, stockholders, employees, agents and representatives of the general partner of Lessor and any partner, agent, or representative of Lessor, and the respective heirs, personal representatives, successors and assigns of any such officer, director, partner, stockholder, employee, agent or representative.
Minimum Price: The sum of (a) the equity in the Leased Property at the time of acquisition of the Leased Property by Lessor (i.e., that portion of the purchase price of the Leased Property paid by Lessor in cash or exchange for partnership interests in the Lessor) plus (b) other capital expenditures on the Leased Property made by Lessor after the date hereof plus (c) the unpaid principal balance of all encumbrances against the Leased Property at the time of purchase of the Leased Property by Lessee, less (x) all proceeds received by Lessor from any financing or refinancing of the Leased Property after the date hereof (after payment of any debt
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refinanced and net of any costs and expenses incurred in connection with such financing or refinancing, including, without limitation, loan points, commitment fees and commissions and legal fees) and (y) the net amount (after deduction of all reasonable legal fees and other costs and expenses, including without limitation expert witness fees, incurred by Lessor in connection with obtaining any such proceeds or award) of all insurance proceeds received by Lessor and awards received by Lessor from any partial Taking of the Leased Property that are not applied to restoration.
Mortgage: As defined in Section 30.2.
Notice: A notice given pursuant to Article XXXII.
Officer’s Certificate: A certificate of Lessee reasonably acceptable to Lessor, signed by the chief financial officer or another officer authorized so to sign by the board of directors or limited liability company agreement of Lessee, or any other person whose power and authority to act has been authorized by delegation in writing by any such officer.
Overdue Rate: On any date, a rate equal to the Base Rate plus 5% per annum, but in no event greater than the maximum rate then permitted under applicable law. Other Revenues: Gross revenue from the operation of the Facility excluding:
(a) Room Revenues;
(b) the amount of all credit, rebates or refunds to customers, guests or patrons;
(c) all sales taxes or any other taxes imposed on such revenues.
Payment Date: Any due date for the payment of any installment of Percentage Rent.
Percentage Rent: As defined in Section 3.1(a).
Person: Any Government, natural person, corporation, partnership, limited liability company, joint venture, association, trust, or other legal entity.
Personal Property Taxes: All personal property taxes imposed on the furniture, furnishings or other items of personal property located on, and used in connection with, the operation of the Leased Improvements as a hotel (other than Inventory and other personal property owned by the Lessee), together with all replacement, modifications, alterations and additions thereto.
Primary Intended Use: As defined in Section 7.2(b).
Proceeding: Any judicial action, suit or proceeding (whether civil or criminal), any administrative proceeding (whether formal or informal), any investigation by a governmental authority or entity (including a grand jury), and any arbitration, mediation or other non-judicial process for dispute resolution.
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RCRA: The Resource Conservation and Recovery Act, as amended.
Real Estate Taxes: All real estate taxes, including general and special assessments, if any, which are imposed upon the Land and any improvements thereon.
Rejectable Offer Price: An amount equal to the greater of (a) the Fair Market Value, determined as of the applicable purchase date, or (b) the Minimum Price.
Rent: Collectively, the Percentage Rent and Additional Charges.
Room Revenues: Gross revenue from the rental of guest rooms, whether to individuals, groups or transients, at the Facility, excluding the following:
(a) the amount of all credits, rebates or refunds to customers, guests or patrons;
(b) all sales taxes or any other taxes imposed on the rental of such guest rooms; and
(c) any fees collected for amenities including, but not limited to: telephone, laundry, movies or concessions.
XXXX: The Superfund Amendments and Reauthorization Act of 1986, as amended.
State: The State or Commonwealth of the United States in which the Leased Property is located.
Subsidiaries: Corporations in which Lessee owns, directly or indirectly, more than 50% of the voting stock or control, as applicable (individually, a “Subsidiary”).
Taking: A taking or voluntary conveyance during the Term hereof of all or part of the Leased Property, or any interest therein or right accruing thereto or use thereof, as the result of, 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.
Term: As defined in Section 1.2.
TSCA: The Toxic Substances Control Act, as amended.
Unavoidable Delays: Delays due to strikes, lock-outs, labor unrest, inability to procure materials, power failure, acts of God, governmental restrictions, enemy action, civil commotion, fire, unavoidable casualty or other causes beyond the control of the party responsible for performing an obligation hereunder, provided that lack of funds shall not be deemed a cause beyond the control of either party hereto unless such lack of funds is caused by the failure of the other party hereto to perform any obligations of such party under this Lease or any guaranty of this Lease.
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Uneconomic for its Primary Intended Use: A state or condition of the Facility (after the application of any insurance proceeds if any) such that, in the good faith judgment of Lessee, reasonably exercised and evidenced by the resolution of the board of directors or other governing body of Lessee, the Facility cannot be operated on a commercially practicable basis for its Primary Intended Use, taking into account, among other relevant factors, the number of usable rooms and projected revenues, such that Lessee intends to, and shall, complete the cessation of operations from the Facility.
Uniform System: The Uniform System of Accounts for Hotels (8th Revised Edition, 1986) as published by the Hotel Association of New York City, Inc., as same may hereafter be revised.
Unsuitable for its Primary Intended Use: A state or condition of the Facility (after the application of insurance proceeds if any) such that, in the good faith judgment of Lessee, reasonably exercised and evidenced by the resolution of the board of directors or other governing body of Lessee, due to casualty damage or loss through Condemnation, the Facility cannot function as an integrated hotel facility consistent with standards applicable to a well maintained and operated hotel.
ARTICLE III
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payments, then the amount of such excess shall be credited against the next Percentage Rent payments due from Lessee to Lessor until the amount of such excess has been credited in full.
The obligation to pay Percentage Rent shall survive the expiration or earlier termination of the Term, and a final reconciliation, taking into account, among other relevant adjustments, any adjustments which are accrued after such expiration or termination date but which related to Percentage Rent accrued prior to such termination date, and Lessee’s good faith allowances, shall be made not later than two years after such expiration or termination date, but Lessee shall advise Lessor within 60 days after such expiration or termination date of Lessee’s best estimate at that time of the approximate amount of such adjustments, which estimate shall not be binding on Lessee or have any legal effect whatsoever. The accrual of Percentage Rent shall cease with the termination of the Lease.
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reached after such 60-day period, Lessee shall withdraw such notice and this Lease shall continue in full force. Once the “conversion” is approved or the Lessor has approved such operations, the Lessee may lease such converted facilities. If the Lessee desires to relet such facilities, the Lessor shall approve the terms of such lease unless its terms are the same or more advantageous to the Lessor than those of the prior lease.
ARTICLE IV
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same, and Lessee, to the extent it possesses the same, will provide the other party, upon request, with cost and depreciation records necessary for filing returns for any property classified as personal property. Where Lessor is legally required to file Personal Property Tax returns, Lessee shall provide Lessor with copies of assessment notices in sufficient time for Lessor to file a protest. Lessor may, upon notice to Lessee, at Lessor’s option and at Lessor’s sole expense, protest, appeal, or institute such other proceedings (in its or Lessee’s name) as Lessor may deem appropriate to effect a reduction for those Impositions to be paid by Lessor, and Lessee, at Lessor’s expense as aforesaid, shall fully cooperate with Lessor in such protest, appeal, or other action. Lessee may, at its sole expense, and upon notice to Lessor, protest, appeal or institute such other proceedings (in its or in Lessor’s name) as Lessee may deem appropriate to effect a reduction for these Impositions to be paid by the Lessee, and Lessor, at Lessee’s expense, shall fully cooperate with Lessee in such protest, appeal or other action. Lessor hereby agrees to indemnify, defend, and hold harmless Lessee from and against any claims, obligations, and liabilities against or incurred by Lessee in connection with such cooperation. Lessor, however, reserves the right to effect any such protest, appeal or other action and, upon notice to Lessee, shall control any such activity, which shall then go forward at Lessor’s sole expense. Upon such notice, Lessee, at Lessor’s expense, shall cooperate fully with such activities. If requested by any lender of the Lessor relating to the Leased Property, the Lessee shall provide any funds for the escrow of any Imposition, and the Lessee shall received any income on such escrowed funds and shall receive any funds released from such escrow.
ARTICLE V
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same, nor seek nor be entitled to any abatement, deduction, deferment or reduction of the Rent, or setoff against the Rent, nor shall the obligations of Lessee be otherwise affected by reason of (a) any damage to, or destruction of, any Leased Property or any portion thereof from whatever cause or any Taking of the Leased Property or any portion thereof, (b) the lawful or unlawful prohibition of, or restriction upon, Lessee’s use of the Leased Property, or any portion thereof, or the interference with such use by any Person, corporation, partnership or other entity, (c) any claim which Lessee has or might have against Lessor by reason of any default or breach of any warranty by Lessor under this Lease or any other agreement between Lessor and Lessee, or to which Lessor and Lessee are parties, (d) any bankruptcy, insolvency, reorganization, composition, readjustment, liquidation, dissolution, winding up or other proceedings affecting Lessor or any assignee or transferee of Lessor, or (e) for any other cause whether similar or dissimilar to any of the foregoing other than a discharge of Lessee from any such obligations as a matter of law. Lessee hereby specifically waives all rights, arising from any occurrence whatsoever, which may now or hereafter be conferred upon it by law to (1) modify, surrender or terminate this Lease or quit or surrender the Leased Property or any portion thereof, or (2) entitle Lessee to any abatement, reduction, suspension or deferment of the Rent or other sums payable by Lessee hereunder, except as otherwise specifically provided in this Lease. The obligations of Lessee hereunder shall be separate and independent covenants and agreements and the Rent and all other sums payable by Lessee 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 Lease or by termination of this Lease other than by reason of an Event of Default.
ARTICLE VI
6.2 Lessee’s Personal Property.
(a) Lessee will acquire and maintain throughout the Term such Inventory as is required to operate the Leased Property in the manner contemplated by this Lease and, from and after the Capitalization Date, all Hotel Property. Lessee may (and shall as provided herein below), at its expense, install, affix or assemble or place on any parcels of the Land or in any of the Leased Improvements, any items of personal property (including Inventory and Hotel Property) owned by Lessee. Lessee, at the commencement of the Term, and from time to time thereafter, shall provide Lessor with an accurate list of all such items of Lessee’s personal property (collectively, the “Lessee’s Personal Property”). Lessee may, subject to the first sentence of this Section 6.2 and the conditions set forth below, remove any of Lessee’s Personal Property set forth on such list at any time during the Term or upon the expiration or any prior termination of the Term. All of Lessee’s Personal Property, other than Inventory, not removed by Lessee within ten days following the expiration or earlier termination of the Term shall be considered abandoned by Lessee and may be appropriated, sold, destroyed or otherwise disposed of by Lessor without first giving Notice thereof to Lessee, without any payment to Lessee and without any obligation to account therefor. Lessee will, at its expense, restore the Leased Property to the condition required by Section 9.1(a), including repair of all damage to the Leased Property caused by the removal of Lessee’s Personal
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Property, effected by Lessee. Upon the expiration or earlier termination of the Term, Lessor or its designee shall have the option to purchase all Inventory and any or all Hotel Property on hand at the Leased Property at the time of such expiration or termination for a sale price equal to the fair market value of such Inventory. Lessee may make such financing arrangements, title retention agreements, leases or other agreements with respect to the Lessee’s Personal Property as it sees fit provided that Lessee first advises Lessor of any such arrangement and such arrangement expressly provides that in the event of Lessee’s default thereunder, Lessor (or its designee) may assume Lessee’s obligations and rights under such arrangement.
(b) From and after the Capitalization Date, Lessee, at its expense, shall acquire and maintain, and install, affix or assemble or place on the Land and in the Leased Improvements, all Hotel Property, all of which shall be deemed to be part of Lessee’s Personal Property for all purposes hereunder, and none of which shall be deemed to be Leased Property with respect to any period after the Capitalization Date.
ARTICLE VII
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Lessee the benefit of all of Lessor’s rights to proceed against any predecessor in title other than Lessee (or an Affiliate of Lessee which conveyed the Property to Lessor) for breaches of warranties or representations or for latent defects in the Leased Property. Lessor shall fully cooperate with Lessee in the prosecution of any such claim, in Lessor’s or Lessee’s name, all at Lessee’s sole cost and expense. Lessee hereby agrees to indemnify, defend and hold harmless Lessor from and against any claims, obligations and liabilities against or incurred by Lessor in connection with such cooperation. Provided, however, that nothing herein shall be deemed to limit Lessor’s obligations under Section XL and 40.2.
7.2 Use of the Leased Property.
(a) Lessee covenants that it will obtain and to maintain all approvals needed to use and operate the Leased Property and the Facility under applicable local, state and federal law.
(b) Lessee shall use or cause to be used the Leased Property only as a hotel facility, and for such other uses as may be necessary or incidental to such use (the “Primary Intended Use”). Lessee shall not use the Leased Property or any portion thereof for any other use without the prior written consent of Lessor, which consent may be granted, denied or conditioned in Lessor’s sole discretion. No use shall be made or permitted to be made of the Leased Property, and no acts shall be done, which will cause the cancellation or substantially increase the premium of any insurance policy covering the Leased Property or any part thereof (unless another adequate policy satisfactory to Lessor is available and Lessee pays any premium increase), nor shall Lessee sell or permit to be kept, used or sold in or about the Leased Property any article which may be prohibited by law or fire underwriter’s regulations. Lessee shall, at its sole cost, comply with all of the requirements pertaining to the Leased Property of any insurance board, association, organization or company necessary for the maintenance of insurance, as herein provided, covering the Leased Property and Lessee’s Personal Property.
(c) Subject to the provisions of Articles XIV and XV, Lessee covenants and agrees that during the Term it will (1) operate continuously the Leased Property as a hotel facility, (2) keep in full force and effect and materially comply with all the provisions of the Franchise Agreement (except that Lessee shall have no obligation to complete any improvements to the Leased Property required by the franchisor unless the Lessor funds the cost thereof), (3) not terminate or amend the Franchise Agreement without the consent of Lessor, (4) maintain appropriate certifications and licenses for such use and (5) will seek to maximize the Gross Revenues generated therefrom consistent with sound business practices.
(d) Lessee shall not commit or suffer to be committed any waste on the Leased Property, or in the Facility, nor shall Lessee cause or permit any nuisance thereon.
(e) Lessee shall neither suffer nor permit the Leased Property or any portion thereof, or Lessee’s Personal Property, to be used in such a manner as (1) might reasonably tend to impair Lessor’s (or Lessee’s, as the case may be) title thereto or to any portion thereof, or (2) may reasonably make possible a claim or claims of adverse usage or adverse possession by the public, as such, or of
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implied dedication of the Leased Property or any portion thereof, except as necessary in the ordinary and prudent operation of the Facility on the Leased Property.
ARTICLE VIII
8.1 Compliance with Legal and Insurance Requirements, etc. Subject to Section 8.3(b) below and Article XII relating to permitted contests, Lessee, at its expense, will promptly (a) comply with all applicable Legal Requirements and Insurance Requirements in respect of the use, operation, maintenance, repair and restoration of the Leased Property, and (b) procure, maintain and comply with all appropriate licenses and other authorizations required for any use of the Leased Property and Lessee’s Personal Property then being made, and for the proper erection, installation, operation and maintenance of the Leased Property or any part thereof.
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so to comply therewith, Lessee may delay compliance therewith until the final determination of such proceeding. If any lien, charge or civil or criminal liability would be incurred by reason of any such delay, Lessee, on the prior written consent of Lessor, which consent shall not be unreasonably withheld, may nonetheless contest as aforesaid and delay as aforesaid provided that such delay would not subject Lessor to criminal liability and Lessee both (a) furnishes to Lessor security reasonably satisfactory to Lessor against any loss or injury by reason of such contest or delay and (b) prosecutes the contest with due diligence and in good faith.
(a) At all times hereafter until the later of (i) such time as all liabilities, duties or obligations of Lessee to the Lessor under the Lease have been satisfied in full and (ii) such time as Lessee completely vacates the Leased Property and surrenders possession of the same to Lessor, Lessee shall fully comply with all Environmental Laws applicable to the Leased Property and the operations thereon. Lessee agrees to give Lessor prompt written notice of (1) all Environmental Liabilities; (2) all pending, threatened or anticipated Proceedings, and all notices, demands, requests or investigations, relating to any Environmental Liability or relating to the issuance, revocation or change in any Environmental Authorization required for operation of the Leased Property; (3) all Releases at, on, in, under or in any way affecting the Leased Property, or any Release known by Lessee at, on, in or under any property adjacent to the Leased Property; and (4) all facts, events or conditions that could reasonably lead to the occurrence of any of the above-referenced matters.
(b) Lessor hereby agrees to defend, indemnify and save harmless any and all Lessee Indemnified Parties from and against any and all Environmental Liabilities other than Environmental Liabilities which were caused by the acts or grossly negligent failures to act of Lessee.
(c) Lessee hereby agrees to defend, indemnify and save harmless any and all Lessor Indemnified Parties from and against any and all Environmental Liabilities which were caused by the acts or grossly negligent failures to act of Lessee.
(d) If any Proceeding is brought against any Indemnified Party in respect of an Environmental Liability with respect to which such Indemnified Party may claim indemnification under either Section 8.3(b) or 8.3(c), the Indemnifying Party, upon request, shall at its sole expense resist and defend such Proceeding, or cause the same to be resisted and defended by counsel designated by the Indemnified Party and approved by the Indemnifying Party, which approval shall not be unreasonably withheld; provided, however, that such approval shall not be required in the case of defense by counsel designated by any insurance company undertaking such defense pursuant to any applicable policy of insurance. Each Indemnified Party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and expenses of such counsel will be at the sole expense of such Indemnified Party unless such counsel has been approved by the Indemnifying Party, which approval shall not be unreasonably withheld. The Indemnifying Party shall not be liable for any settlement of any such Proceeding made without its consent, which shall
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not be unreasonably withheld, but if settled with the consent of the Indemnifying Party, or if settled without its consent (if its consent shall be unreasonably withheld), or if there be a final, nonappealable judgment for an adversary party in any such Proceeding, the Indemnifying Party shall indemnify and hold harmless the Indemnified Parties from and against any liabilities incurred by such Indemnified Parties by reason of such settlement or judgment.
(e) At any time any Indemnified Party has reason to believe circumstances exist which could reasonably result in an Environmental Liability, upon reasonable prior written notice to Lessee stating such Indemnified Party’s basis for such belief, an Indemnified Party shall be given immediate access to the Leased Property (including, but not limited to, the right to enter upon, investigate, drill xxxxx, take soil borings, excavate, monitor, test, cap and use available land for the testing of remedial technologies), Lessee’s employees, and to all relevant documents and records regarding the matter as to which a responsibility, liability or obligation is asserted or which is the subject of any Proceeding; provided that such access may be conditioned or restricted as may be reasonably necessary to ensure compliance with law and the safety of personnel and facilities or to protect confidential or privileged information. All Indemnified Parties requesting such immediate access and cooperation shall endeavor to coordinate such efforts to result in as minimal interruption of the operation of the Leased Property as practicable.
(f) The indemnification rights and obligations provided for in this Article VIII shall be in addition to any indemnification rights and obligations provided for elsewhere in this Lease.
(g) The indemnification rights and obligations provided for in this Article VIII shall survive the termination of this Agreement.
For purposes of this Section 8.3, all amounts for which any Indemnified Party seeks indemnification shall be computed net of (a) any actual income tax benefit resulting therefrom to such Indemnified Party, (b) any insurance proceeds received (net of tax effects) with respect thereto, and (c) any amounts recovered (net of tax effects) from any third parties based on claims the Indemnified Party has against such third parties which reduce the damages that would otherwise be sustained; provided that in all cases, the timing of the receipt or realization of insurance proceeds or income tax benefits or recoveries from third parties shall be taken into account in determining the amount of reduction of damages. Each Indemnified Party agrees to use its reasonable efforts to pursue, or assign to Lessee or Lessor, as the case may be, any claims or rights it may have against any third party which would materially reduce the amount of damages otherwise incurred by such Indemnified Party.
Notwithstanding anything to the contrary contained in this Agreement, if Lessor shall become entitled to the possession of the Leased Property by virtue of the termination of the Lease or repossession of the Leased Property, then Lessor may assign its indemnification rights under Section 8.3 of this Agreement (but not any other rights hereunder) to any Person to whom the Lessor subsequently transfers the Leased Property, subject to the following conditions and limitations, each of which shall be deemed to be incorporated into the terms of such assignment, whether or not specifically referred to therein:
(1) The indemnification rights referred to in this section may be assigned only if a known Environmental Liability then exists or if a Proceeding is then pending or, to the knowledge of Lessee or Lessor, then threatened with respect to the Leased Property.
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(2) Such indemnification rights shall be limited to Environmental Liabilities relating to or specifically affecting the Leased Property; and
(3) Any assignment of such indemnification rights shall be limited to the immediate transferee of Lessor, and shall not extend to any such transferree’s successors or assigns.
ARTICLE IX
9.1 Capital Improvements, Maintenance and Repair.
(a) Subject to Section 9.1(b), Lessee will keep the Leased Property and all private roadways, sidewalks and curbs appurtenant thereto that are under Lessee’s control, including windows and plate glass, parking lots, mechanical, electrical and plumbing systems and equipment (including conduit and ductware), and non-load bearing interior walls, and all Hotel Property in good order and repair, except for ordinary wear and tear (whether or not the need for such repairs occurred as a result of Lessee’s use, any prior use, the elements or the age of the Leased Property, or any portion thereof), and, except as otherwise provided in Articles XIV or XV, with reasonable promptness, make all necessary and appropriate repairs thereto of every kind and nature, whether interior or exterior, ordinary or extraordinary, foreseen or unforeseen, or required by any governmental agency having jurisdiction over the Leased Property, except as to the structural elements of the Leased Improvements and underground utilities.
(b) Notwithstanding any other provision of this Lease, unless the need for compliance with Section 9.1(a) is caused by Lessee’s negligence or willful misconduct or that of its employees or agents, Lessee shall not be required to bear the costs of complying with Section 9.1(a) with respect to items classified as either (i) capital items under U.S. generally accepted accounting principles or (ii) Fixtures or, prior to the Capitalization Date, Furniture and Equipment in, on, or under the Facility or its components, except to the extent (X) that amounts are available therefor from Lessor under Article XL or otherwise or (Y) required under Articles XIV and XV on the conditions set forth therein.
(c) Article XL sets forth the only obligations of Lessor to fund the cost of any repairs, replacements, alterations, restorations or renewals of any nature or description to the Leased Property, whether ordinary or extraordinary, foreseen or unforeseen, or to make any expenditure whatsoever with respect thereto, in connection with this Lease, or to maintain the Leased Property in any way. Lessee hereby waives, to the extent permitted by law, the right to make repairs at the expense of Lessor pursuant to any law in effect at the time of the execution of this Lease or hereafter enacted. Lessor 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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(d) Lessee shall be permitted to prosecute claims against Lessor’s predecessors in title for breach of any representation or warranty or for any latent defects in the Leased Property to be maintained by Lessee unless Lessor is already diligently pursuing such a claim. All repairs shall, to the extent reasonably achievable, be at least equivalent in quality to the original work. Lessee will not take or omit to take any action, the taking or omission of which might materially impair the value or the usefulness of the Leased Property or any part thereof for its Primary Intended Use.
(f) Lessee will, upon the expiration or prior termination of the Term, vacate and surrender the Leased Property to Lessor in the condition in which the Leased Property was originally received from Lessor, except as repaired, rebuilt, restored, altered or added to as permitted or required by the provisions of this Lease and except for ordinary wear and tear (subject to the obligation of Lessee to maintain the Leased Property in accordance with Section 9.1(a) above during the entire Term of the Lease), or damage by casualty or Condemnation (subject to the obligations of Lessee to restore or repair as set forth in the Lease).
ARTICLE X
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Property or adversely affect the ability of the Lessee to comply with the provisions of this Lease. The cost of such additions, modifications or improvements to the Leased Property shall be paid by Lessee, and all such additions, modifications and improvements shall, without payment by Lessor at any time, be included under the terms of this Lease and upon expiration or earlier termination of this Lease shall pass to and become the property of Lessor.
ARTICLE XI
ARTICLE XII
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or construed in any way to relieve, modify or extend Lessee’s covenants to pay or its covenants to cause to be paid any such charges at the time and in the manner as in this Article provided), on condition, however, that such legal proceedings shall not operate to relieve Lessee from its obligations hereunder and shall not cause the sale or risk the loss of any portion of the Leased Property, or any part thereof, or cause Lessor or Lessee to be in default under any mortgage, deed of trust, security deed or other agreement encumbering the Leased Property or any interest therein. Upon the request of Lessor, Lessee shall either (a) provide a bond or other assurance reasonably satisfactory to Lessor that all Claims which may be assessed against the Leased Property together with interest and penalties, if any, thereon will be paid, or (b) deposit within the time otherwise required for payment with a bank or trust company as trustee upon terms reasonably satisfactory to Lessor, as security for the payment of such Claims, money in an amount sufficient to pay the same, together with interest and penalties in connection therewith, as to all Claims which may be assessed against or become a Claim on the Leased Property, or any part thereof, in said legal proceedings. Lessee shall furnish Lessor and any lender of Lessor with reasonable evidence of such deposit within five days of the same. Lessor agrees to join in any such proceedings at Lessee’s expense if the same be required to legally prosecute such contest of the validity of such Claims; provided, however, that Lessor shall not thereby be subjected to any liability for the payment of any costs or expenses in connection with any proceedings brought by Lessee; and Lessee covenants to indemnify and save harmless Lessor from any such costs or expenses. Lessee shall be entitled to any refund of any Claims and such charges and penalties or interest thereon which have been paid by Lessee or paid by Lessor and for which Lessor has been fully reimbursed. In the event that Lessee fails to pay any Claims when due or to provide the security therefor as provided in this paragraph and to diligently prosecute any contest of the same, Lessor may, upon ten days advance Notice to Lessee, pay such charges together with any interest and penalties and the same shall be repayable by Lessee to Lessor as Additional Charges at the next Payment Date provided for in this Lease. Provided, however, that should Lessor reasonably determine that the giving of such Notice would risk loss to the Leased Property or cause damage to Lessor, then Lessor shall give such Notice as is practical under the circumstances. Lessor reserves the right to contest any of the Claims at its expense not pursued by Lessee. Lessor and Lessee agree to cooperate in coordinating the contest of any claims.
ARTICLE XIII
13.1 General Insurance Requirements.
(i) Building insurance on the “Special Form” (formerly “All Risk” form) (which may include earthquake and flood in reasonable amounts as determined by Lessor) in an amount not less than 100% of the then full replacement cost thereof (as defined in Section 13.2) or such other amount which is acceptable to Lessor, and personal property insurance on the “Special Form” in the full amount of the replacement cost thereof;
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(ii) Insurance for loss or damage (direct and indirect) from steam boilers, pressure vessels or similar apparatus, now or hereafter installed in the Facility, in the minimum amount of $5,000,000 or in such lesser or greater amounts as are then customary or as may be reasonably requested by Lessor from time to time;
(iii) Loss of income insurance on the “Special Form”, in the amount of one year of Percentage Rent for the benefit of Lessor, and business interruption insurance on the “Special Form” in the amount of one year of gross profit, for the benefit of Lessor or Lessee;
(iv) Commercial general liability insurance, with amounts not less than $10,000,000 covering each of the following: bodily injury, death, or property damage liability per occurrence, personal and advertising injury, general aggregate, products and completed operations, with respect to Lessor, and “all risk legal liability” (including liquor law or “dram shop” liability, if liquor or alcoholic beverages are served on the Leased Property) with respect to Lessor and Lessee;
(v) Insurance covering such other hazards and in such amounts as may be customary for comparable properties in the area of the Leased Property and is available from insurance companies, insurance pools or other appropriate companies authorized to do business in the State at rates which are economically practicable in relation to the risks covered as may be reasonably requested by Lessor;
(vi) Fidelity bonds with limits and deductibles as may be reasonably requested by Lessor, covering Lessee’s employees in job classifications normally bonded under prudent hotel management practices in the United States or otherwise required by law;
(vii) Workmen’s compensation insurance to the extent necessary to protect Lessor and the Leased Property against Lessee’s xxxxxxx’x compensation claims;
(viii) Vehicle liability insurance for owned, non-owned, and hired vehicles, in the amount of $1,000,000; and
(ix) Such other insurance as Lessor may reasonably request for facilities such as the Leased Property and the operation thereof.
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for the escrow of any insurance premiums, and the Lessee shall receive any income on such escrowed funds and shall receive any funds released from such account.
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ARTICLE XIV
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repair and restore, and the Lease is terminated without purchase by Lessee as described in Section 14.2, all such insurance proceeds shall be retained by Lessor. All salvage resulting from any risk covered by insurance shall belong to Lessor.
14.2 Reconstruction in the Event of Damage or Destruction Covered by Insurance.
(a) Except as provided in Section 14.5, if during the Term the Leased Property is totally or partially destroyed by a risk covered by the insurance described in Article XIII and the Facility thereby is rendered Unsuitable for its Primary Intended Use, Lessee shall, at Lessee’s option, either (1) restore the Facility to substantially the same condition as existed immediately before the damage or destruction and otherwise in accordance with the terms of the Lease, or (2) offer to acquire the Leased Property from Lessor for a purchase price equal to the Rejectable Offer Price of the Leased Property. If Lessee restores the Facility, the insurance proceeds shall be paid out by Lessor from time to time for the reasonable costs of such restoration upon satisfaction of reasonable terms and conditions, and any excess proceeds remaining after such restoration shall be paid to Lessee. If Lessee acquires the Leased Property, Lessee shall receive the insurance proceeds. If Lessor does not accept Lessee’s offer so to purchase the Leased Property within 90 days, Lessee may withdraw its offer to purchase the Leased Property and, if so withdrawn, Lessee may terminate the Lease with respect to the Leased Property without further liability hereunder and Lessor shall be entitled to retain all insurance proceeds.
(b) Except as provided in Section 14.5, if during the Term the Leased Property is partially destroyed by a risk covered by the insurance described in Article XIII, but the Facility is not thereby rendered Unsuitable for its Primary Intended Use, Lessee shall restore the Facility to substantially the same condition as existed immediately before the damage or destruction and otherwise in accordance with the terms of the Lease. Such damage or destruction shall not terminate this Lease; provided, however, that if Lessee cannot within a reasonable time obtain all necessary government approvals, including building permits, licenses and conditional use permits, after diligent efforts to do so, to perform all required repair and restoration work and to operate the Facility for its Primary Intended Use in substantially the same manner as that existing immediately prior to such damage or destruction and otherwise in accordance with the terms of the Lease, Lessee may make a written offer to Lessor to purchase the Leased Property for a purchase price equal to the Rejectable Offer Price of the Leased Property determined without regard to such damage or destruction. If Lessee makes such offer and Lessor does not accept the same within 30 days after Lessee delivers its offer to Lessor, Lessee shall withdraw such offer, in which event this Lease shall remain in full force and effect and Lessee shall immediately proceed to restore the Facility to substantially the same condition as existed immediately before such damage or destruction and otherwise in accordance with the terms of the Lease. If Lessee restores the Facility, the insurance proceeds shall be paid out by Lessor from time to time for the reasonable costs of such restoration upon satisfaction of reasonable terms and conditions specified by Lessor, and any excess proceeds remaining after such restoration shall be paid to Lessee.
(c) If the cost of the repair or restoration exceeds the amount of proceeds received by Lessor from the insurance required under Article XIII, Lessee shall be obligated to contribute any excess amounts needed to restore the Facility prior to commencing work thereon.
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Such difference shall be paid by Lessee to Lessor promptly after Lessee receives Lessor’s written invoice therefore, to be held in trust, together with any other insurance proceeds, for application to the cost of repair and restoration.
(d) If Lessor accepts Lessee’s offer to purchase the Leased Property under this Article, this Lease shall terminate as to the Leased Property upon payment of the purchase price, and Lessor shall remit to Lessee all insurance proceeds pertaining to the Leased Property being held in trust by Lessor.
14.3 Reconstruction in the Event of Damage or Destruction Not Covered by Insurance.
Except as provided in Section 14.5, if during the Term the Facility is totally or materially destroyed by a risk not covered by the insurance described in Article XIII, whether or not such damage or destruction renders the Facility Unsuitable for its Primary Intended Use, Lessee at its option shall either, (a) at Lessee’s sole cost and expense, restore the Facility to substantially the same condition it was in immediately before such damage or destruction and such damage or destruction shall not terminate this Lease, or (b) make a written offer to purchase the Leased Property for a purchase price equal to the Rejectable Offer Price of the Leased Property without regard to such damage or destruction. If Lessor does not accept Lessee’s offer so to purchase the Leased Property within 90 days after Lessee delivers its offer to Lessor, Lessee may withdraw its offer to purchase the Leased Property and, if so withdrawn, Lessee may terminate the Lease with respect to the Leased Property without further liability hereunder. If such damage or destruction is not material, Lessee shall, at Lessee’s sole cost and expense, restore the Facility to substantially the same condition as existed immediately before the damage or destruction and otherwise in accordance with the terms of the Lease, and such damage or destruction shall not terminate the Lease.
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ARTICLE XV
(a) “Condemnation” means a Taking resulting from (1) the exercise of any governmental power, whether by legal proceedings or otherwise, by a Condemnor, and (2) a voluntary sale or transfer by Lessor to any Condemnor, either under threat of condemnation or while legal proceedings for condemnation are pending.
(b) “Date of Taking” means the date the Condemnor has the right to possession of the property being condemned.
(c) “Award” means all compensation, sums or anything of value awarded, paid or received on a total or partial Condemnation.
(d) “Condemnor” means any public or quasi-public authority, or private corporation or individual, having the power of Condemnation.
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ARTICLE XVI
(a) if an event of default occurs, which is not cured, under any other lease between Lessor or any Affiliate of Lessor and Lessee or any Affiliate of Lessee; or
(b) if Lessee fails to make payment of the Percentage Rent or Additional Charges within ten days after the same becomes due and payable;
(c) if Lessee fails to observe or perform any other term, covenant or condition of this Lease and such failure is not cured by Lessee within a period of 30 days after receipt by the Lessee of Notice thereof from Lessor, unless such failure cannot with due diligence be cured within a period of 30 days, in which case it shall not be deemed an Event of Default if Lessee proceeds promptly and with due diligence to cure the failure and diligently completes the curing thereof provided, however, in no event shall such cure period extend beyond 90 days after such Notice; or
(d) if the Lessee shall file a petition in bankruptcy or reorganization for an arrangement pursuant to any federal or state bankruptcy law or any similar federal or state law,
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or shall be adjudicated a bankrupt or shall make an assignment for the benefit of creditors or shall admit in writing its inability to pay its debts generally as they become due, or if a petition or answer proposing the adjudication of the Lessee as a bankrupt or its reorganization pursuant to any federal or state bankruptcy law or any similar federal or state law shall be filed in any court and the Lessee shall be adjudicated a bankrupt and such adjudication shall not be vacated or set aside or stayed within 60 days after the entry of an order in respect thereof, or if a receiver of the Lessee or of the whole or substantially all of the assets of the Lessee shall be appointed in any proceeding brought by the Lessee or if any such receiver, trustee or liquidator shall be appointed in any proceeding brought against the Lessee and shall not be vacated or set aside or stayed within 120 days after such appointment; or
(e) if Lessee is liquidated or dissolved, or begins proceedings toward such liquidation or dissolution, or, in any manner, permits the sale or divestiture of substantially all of its assets; or
(f) if the estate or interest of Lessee in the Leased Property or any part thereof is voluntarily or involuntarily transferred, assigned, conveyed, levied upon or attached in any proceeding (unless Lessee is contesting such lien or attachment in good faith in accordance with Article XI hereof); or
(g) if, except as a result of damage, destruction or a partial or complete Condemnation, Lessee voluntarily ceases operations on the Leased Property; or
(h) if a material event of default has been declared by the franchisor under the Franchise Agreement with respect to the Facility on the Leased Premises which has not been cured within any applicable cure period or such Franchise Agreement has been terminated as a result of any action or failure to act by the Lessee; then, and in any such event, Lessor may exercise one or more remedies available to it herein or at law or in equity, including but not limited to its right to terminate this Lease by giving Lessee not less than ten days’ Notice of such termination except in the case of a default under Sections 16.1(e), 16.1(f), or 16.1(g), in which case notice shall not be required.
If litigation is commenced with respect to any alleged default under this Lease, the prevailing party in such litigation shall receive, in addition to its damages incurred, such sum as the court shall determine as its reasonable attorneys’ fees, and all costs and expenses incurred in connection therewith.
No Event of Default (other than a failure to make a payment of money) shall be deemed to exist under clause (d) during any time for up to one year the curing thereof is prevented by an Unavoidable Delay, provided that upon the cessation of such Unavoidable Delay, Lessee remedies such default or Event of Default without further delay.
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the same and Lessor may enter upon and repossess the Leased Property by reasonable force, summary proceedings, ejectment or otherwise, and may remove Lessee and all other persons and any and all personal property from the Leased Property, subject to rights of any hotel guests and to any requirement of law. Lessee hereby waives any and all requirements of applicable laws for service of notice to re-enter the Leased Property. Lessor shall be under no obligation to, but may if it so chooses, relet the Leased Property or otherwise mitigate Lessor’s damages.
Lessee shall forthwith pay to Lessor, at Lessor’s option, as and for liquidated and agreed current damages for Lessee’s default, either:
(1) Without termination of Lessee’s right to possession of the Leased Property, each installment of Rent and other sums payable by Lessee to Lessor under the Lease as the same becomes due and payable, which Rent and other sums shall bear interest at the Overdue Rate, and Lessor may enforce, by action or otherwise, any other term or covenant of this Lease;
(2) the sum of:
(A) the unpaid Rent which had been earned at the time of termination, repossession or reletting, and
(B) the worth at the time of termination, repossession or reletting of the amount by which the unpaid Rent for the balance of the Term after the time of termination, repossession or reletting, exceeds the amount of such rental loss that Lessee proves could be reasonably avoided and as reduced for rentals received after the time of termination, repossession or reletting, if and to the extent required by applicable law, the worth at the time of termination, repossession or reletting of the amount referred to in this subparagraph 16.3(2)(B) is computed by discounting such amount at the discount rate of the Federal Reserve Bank of New York at the time of award plus 1%, and
(C) any other amount necessary to compensate Lessor for all the detriment proximately caused by Lessee’s failure to perform its obligations under this Lease or which in the ordinary course of things, would be likely to result therefrom.
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benefit of any laws now or hereafter in force exempting property from liability for rent or for debt and Lessor waives any right to “xxxxxx the corporate veil” of Lessee other than to the extent funds shall have been inappropriately paid any Affiliate of Lessee following a default resulting in an Event of Default.
ARTICLE XVII
ARTICLE XVIII
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cost to Lessee or to which Lessee may take subject without cost to Lessee and relating to the period of time after the purchase (e) any taxes not yet due and payable; and (f) those encumbrances created, requested or consented to by Lessee. The difference between the applicable purchase price and the total of the encumbrances assumed or taken subject to shall be paid in cash to Lessor or as Lessor may direct, in federal or other immediately available funds, except as otherwise mutually agreed by Lessor and Lessee. All expenses of such conveyance, including, without limitation, the cost of title examination or title insurance, if desired by Lessee, Lessee’s attorneys’ fees incurred in connection with such conveyance and release, and transfer taxes and recording fees, shall be paid by Lessee. Lessor shall pay its attorney’s fees. This Article XVIII is subject to the prior rights of any lender whose lien is secured by the Leased Premises.
ARTICLE XIX
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(a) The manager does not own, directly or indirectly, more than 35% of the outstanding stock of Xxxxxxxx Hospitality Trust, Inc.
(b) If the manager is a corporation, no more than 35% of the total combined voting power of its outstanding stock (or 35% of the total shares of all classes of its outstanding stock) or, if it is not a corporation, no more than 35% of the ownership interest in its assets or net profits is owned, directly or indirectly, by one or more Persons owning 35% or more of the outstanding stock of Xxxxxxxx Hospitality Trust, Inc.
(c) Neither Xxxxxxxx Hospitality Trust, Inc., the Lessor, the Lessee, nor any Affiliate thereof derives any income from the manager, except for income from the leasing of the Norfolk, Nebraska office building.
(d) At the time that the manager enters into a management agreement with the Lessee to operate the Leased Property, the manager (or any “related person” within the meaning of Section 856(d)(9)(F) of the Code) is actively engaged in the trade or business of operating “qualified lodging facilities” within the meaning of Section 856(d)(9)(D) of the Code for any Person who is not a “related person” within the meaning of Section 856(d)(9)(F) of the Code with respect to Xxxxxxxx Hospitality Trust, Inc or the Lessee (an “Unrelated Person”). For purposes of determining whether the requirement of this paragraph (d) has been met, a manager shall be treated as being actively engaged in such a trade or business if the manager (i) derives at least 10% of both its profits and revenue from operating “qualified lodging facilities” within the meaning of Section 856(d)(9)(D) of the Code for Unrelated Persons or (ii) complies with any regulations or other administrative guidance under Section 856(d)(9) of the Code that provide a “safe harbor “ rule with respect to the amount of hotel management business with Unrelated Persons that is necessary to qualify as an “eligible independent contractor” within the meaning such Code section.
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ARTICLE XX
ARTICLE XXI
ARTICLE XXII
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Lessor shall indemnify, save harmless and defend Lessee Indemnified Parties from and against all liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses imposed upon or incurred by or asserted against Lessee Indemnified Parties as a result of the gross negligence or willful misconduct of Lessor arising in connection with this Lease. The Lessor’s obligations to indemnify Lessee Indemnified Parties shall be limited to the value of Lessor’s equity interest in the Facilities. Nothing herein shall be construed as requiring Lessor to indemnify a Lessee Indemnified Party against its own grossly negligent acts and omissions and willful misconduct.
Any amounts that become payable by an Indemnifying Party under this Section shall be paid within ten days after liability therefor on the part of the Indemnifying Party is determined by litigation or otherwise, and if not timely paid, shall bear a late charge (to the extent permitted by law) at the Overdue Rate from the date of such determination to the date of payment. An Indemnifying Party, at its expense, shall contest, resist and defend any such claim, action or proceeding asserted or instituted against the Indemnified Party. The Indemnified Party, at its expense, shall be entitled to participate in any such claim, action, or proceeding, and neither the Indemnifying Party nor the Indemnified Party may compromise or otherwise dispose of the same without the consent of the Indemnified Party or the Indemnifying Party, which may not be unreasonably withheld. Nothing herein shall be construed as indemnifying a Lessor Indemnified Party against its own grossly negligent acts or omissions or willful misconduct.
Lessee’s or Lessor’s liability for a breach of the provisions of this Article shall survive any termination of this Lease.
ARTICLE XXIII
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any right the sublessee may have to terminate the sublease or to surrender possession thereunder as a result of the termination of this Lease, and (c) if the sublessee receives a written Notice from Lessor or Lessor’s assignees, if any, stating that an uncured Event of Default exists under this Lease, the sublessee shall thereafter be obligated to pay all rentals accruing under said sublease directly to the party giving such Notice, or as such party may direct. All rentals received from the sublessee by Lessor or Lessor’s assignees, if any, as the case may be, shall be credited against the amounts owing by Lessee under this Lease.
ARTICLE XXIV
24.1 Officer’s Certificates; Lessor’s Estoppel Certificates and Covenants.
(a) At any time and from time to time upon not less than 30 days Notice by Lessor, Lessee will furnish to Lessor an Officer’s Certificate certifying that this Lease is unmodified and in full force and effect (or that this Lease is in full force and effect as modified and setting forth the modifications), the date to which the Rent has been paid, whether to the knowledge of Lessee there is any existing default or Event of Default hereunder by Lessor or Lessee, and such other information as may be reasonably requested by Lessor. Any such certificate furnished pursuant to this Section may be relied upon by Lessor, any lender and any prospective purchaser of the Leased Property.
(b) At any time and from time to time upon not less than 10 days Notice by Lessee, Lessor will furnish to Lessee or to any person designated by Lessee an estoppel certificate certifying that this Lease is unmodified and in full force and effect (or that this Lease is in full force and effect as modified and setting forth the modifications), the date to which Rent has been paid, whether to the knowledge of Lessor there is any existing default or Event of Default on Lessee’s part hereunder, and such other information as may be reasonably requested by Lessee.
ARTICLE XXV
ARTICLE XXVI
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ARTICLE XXVII
ARTICLE XXVIII
ARTICLE XXIX
ARTICLE XXX
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deliver the instrument as the agent or attorney-in-fact of Lessee, and Lessee hereby irrevocably constitutes Lessor its attorney-in-fact for such purpose, Lessee acknowledging that the appointment is coupled with an interest and is irrevocable. Lessee hereby waives and releases any claim it might have against Lessor or any other party for any actions lawfully taken by the holder of any Mortgage.
ARTICLE XXXI
ARTICLE XXXII
ARTICLE XXXIII
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To the extent consistent with sound appraisal practice as then existing at the time of any such appraisal, such appraisal shall be made on a basis consistent with the basis on which the Leased Property was appraised for purposes of determining its Fair Market Value at the time the Leased Property was acquired by Lessor. If two appraisers are appointed and if the difference between the amounts so determined does not exceed 5% of the lesser of such amounts, then the Fair Market Value or Fair Market Rental shall be an amount equal to 50% of the sum of the amounts so determined. If the difference between the amounts so determined exceeds 5% of the lesser of such amounts, then such two appraisers shall have 20 days to appoint a third appraiser. If no such appraiser shall have been appointed within such 20 days or within 90 days of the original request for a determination of Fair Market Value or Fair Market Rental, whichever is earlier, either Lessor or Lessee may apply to any court having jurisdiction to have such appointment made by such court. Any appraiser appointed by the original appraisers or by such court shall be instructed to determine the Fair Market Value or Fair Market Rental within 45 days after appointment of such appraiser. The determination of the appraiser which differs most in the terms of dollar amount from the determinations of the other two appraisers shall be excluded, and 50% of the sum of the remaining two determinations shall be final and binding upon Lessor and Lessee as the Fair Market Value or Fair Market Rental of the Leased Property, as the case may be. This provision for determining by appraisal shall be specifically enforceable to the extent such remedy is available under applicable law, and any determination hereunder shall be final and binding upon the parties except as otherwise provided by applicable law. Lessor and Lessee shall each pay the fees and expenses of the appraiser appointed by it and each shall pay one-half of the fees and expenses of the third appraiser and one-half of all other costs and expenses incurred in connection with each appraisal.
ARTICLE XXXIV
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ARTICLE XXXV
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ARTICLE XXXVI
ARTICLE XXXVII
37.1 Lessor’s Option to Purchase Assets of Lessee. Effective on not less than 90 days prior Notice given at any time within 180 days before the expiration of the Term, but not later than 90 days prior to such expiration, or upon such shorter Notice period as shall be appropriate if this Lease is terminated prior to its expiration date, Lessor shall have the option to purchase all (but not less than all) of the assets of Lessee, tangible and intangible, relating to the Leased Property (other than this Lease), at the expiration or termination of this Lease for an amount (payable in cash on the expiration date of this Lease) equal to the fair market value thereof as appraised in
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conformity with Article XXXIII, except that the appraisers need not be members of the American Institute of Real Estate Appraisers, but rather shall be appraisers having at least ten years experience in valuing similar assets. Notwithstanding any such purchase, Lessor shall obtain no rights to any trade name or logo used in connection with the Franchise Agreement unless separate agreement as to such use is reached with the applicable franchisor.
ARTICLE XXXVIII
For the purposes of this Section, fair market value of the leasehold estate means, as applicable, an amount equal to the price that a willing buyer not compelled to buy would pay a willing seller not compelled to sell for Lessee’s leasehold estate under this Lease or an offered replacement leasehold estate.
ARTICLE XXXIX
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ARTICLE XL
(a) Lessee is obligated to repair or replace in any Fiscal Year Fixtures and Furniture and Equipment (i) as required by the terms of any Franchise Agreement, (ii) as required by Article IX and Article XXXIX and (iii) otherwise when and in a manner it deems fit, to the extent funds are available therefor from amounts the Lessor is obligated to make available to Lessee under this Section 40.1 or otherwise makes available to Lessee. During the Term Lessor shall be obligated to make available to Lessee for repairing or replacing Fixtures and Furniture and Equipment an amount equal to 4% of Room Revenues from the Facility for each twelve month period. Lessor shall be required to make such amounts available to Lessee on a quarterly basis. Upon written request by Lessee to Lessor stating the specific use to be made and the reasonable approval thereof by Lessor, such funds shall be made available by Lessor for use by Lessee for periodic repairing or replacement of Fixtures and Furniture and Equipment that constitute Leased Property in connection with the Primary Intended Use. Lessor’s obligation shall be cumulative, but not compounded, and any amounts that have accrued hereunder shall be payable in future periods for such uses and in accordance with the procedure set forth herein. Lessee shall be obligated to return any funds forwarded by Lessor pursuant to this Article XL, but not spent for (i) repair or replacement of Fixtures and Furniture and Equipment that constitute Leased Property in connection with the Primary Intended Use or (ii) Capital Expenditures pursuant to Section 40.2. Other than as specifically set forth above in this Article XL, Lessee shall have no interest in any accrued obligation of Lessor hereunder and Lessor shall have no obligation to segregate or separate any such funds for the benefit of Lessee.
(b) Notwithstanding any provision of Section 40.1(a) to the contrary, after the Capitalization Date:
(i) Lessee is obligated to repair or replace all Fixtures, Furniture and Equipment and Hotel Property (x) as required by the terms of any Franchise Agreement, (y) as required by Article IX and Article XXXIX, and (z) otherwise when and in a manner it deems fit in order to operate the Leased Property in the manner contemplated by this Lease; and
(ii) Lessee is obligated to pay all costs and expenses of any and all repairs and replacements required to be made pursuant to this Section 40.1(b).
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ARTICLE XLI
41.1 SBILP. Lessor, Lessee and, by its signature below, SBILP hereby agree as follows:
(a) SBILP hereby consents to the amendment and restatement of the Original Lease as set forth in this Lease.
(b) Upon the execution and delivery of this Lease, Lessee shall, and does hereby, surrender to SBILP all right, title and interest of Lessee in and to that property, real or personal, tangible or intangible, described on Exhibit “B” attached hereto (the “Excluded Property”), free and clear of all liens and encumbrances of any nature whatsoever arising by through or under Lessee.
(c) SBILP is hereby released from all liabilities and obligations of SBILP arising or accruing under the Original Lease from and after the Commencement Date.
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XXXXXXXX HOSPITALITY LIMITED PARTNERSHIP | ||
By: | Xxxxxxxx Hospitality REIT Trust, its general partner | |
By: | Xxxxxxxx Hospitality REIT Trust, its General Partner | |
By: | /s/ Xxxxxx X. Xxxxxxxxxx | |
Name: | Xxxxxx X. Xxxxxxxxxx | |
Title: | President | |
E&P FINANCING LIMITED PARTNERSHIP | ||
By: | E&P REIT Trust, its General Partner | |
By: | /s/ Xxxxxx X. Xxxxxxxxxx | |
Name: | Xxxxxx X. Xxxxxxxxxx | |
Title: | President | |
TRS LEASING, INC. | ||
By: | /s/ Xxxxxx X. Xxxxxxxxxx | |
Name: | Xxxxxx X. Xxxxxxxxxx | |
Title: | President |
ACKNOWLEDGED AND AGREED: | ||||
SOLOMONS BEACON INN | ||||
LIMITED PARTNERSHIP | ||||
By: | Solomons GP, LLC, its general partner | |||
By: | /s/ Xxxxxx X. Xxxxxxxxxx | |||
Name: | Xxxxxx X. Xxxxxxxxxx | |||
Title: | President |
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