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EXHIBIT 10.2
First Amendment to Lease Agreement
(Super 8 Rock Falls, Illinois)
This First Amendment to Lease Agreement (this "First Amendment") is
entered into by and between Host Funding, Inc., a Maryland corporation
("Lessor"), and Crossroads Hospitality Tenant Company, L.L.C., a Delaware
limited liability company ("Lessee"), and is dated effective as of October 1,
1996 (the "Effective Date").
RECITALS
A. Lessor and Lessee have previously entered into that certain Lease
Agreement (Super 8 Rock Falls, Illinois) (the "Lease Agreement") dated March
29, 1996, by and between Lessor, as Lessor, and Lessee, as Lessee, and covering
the "Leased Property" known as the Super 0 Xxxxx, Xxxx Xxxxx, Xxxxxxxx.
X. Xxxxxx and Lessee now desire to modify and amend the Lease
Agreement in certain respects as provided hereinbelow.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Lessor and Lessee hereby agree as
follows:
1. As of the Effective Date, Section 2 of the Lease Agreement is
amended by the addition thereto of the definition of "Gross Room Revenues," as
follows:
Gross Room Revenues: All revenues derived from the rental, sale,
use or occupancy of guest rooms or meeting rooms within the Leased
Property, including cash and credit transactions, but excluding sales
taxes or other taxes collected from guests, or in conjunction with the
rental of guest rooms or meeting rooms.
2. As of the Effective Date, the Lease is hereby amended by the
deletion therefrom of Exhibit G in its entirety, and, in place of and in
substitution therefor, a new Exhibit G added, said new Exhibit G attached
hereto as Exhibit "A" and incorporated herein by reference for all purposes.
3. As of the Effective Date, the Lease Agreement is hereby amended
by the deletion therefrom of Section 40 in its entirety, and, in the place of
and in substitution therefor, a new Section 40 added, as follows:
Section 40
Capital Expenditures and Reserves
(A) Exhibit "G" contains specific line items for necessary deferred
maintenance and the costs thereof (the "Deferred Maintenance Costs"). On or
before October 1, 1996, Lessor and Lessee
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will contribute into the Capital Expenditure Reserve Account their respective
portions of the Deferred Maintenance Costs, all as more particularly described
in attached "Exhibit G".
(B) Not later than October 31 of each Fiscal Year, Lessee shall
submit to Lessor for Lessor's approval pursuant to the provisions of Section
3.3 hereof, a Capital Expenditure Budget for the next Fiscal Year as part of
Lessee's submission to Lessor of the Annual Budget. The purpose for the
Capital Expenditure Budget shall be to keep the Leased Property competitive
with any hotel or hotels similar in nature and type to the Leased Property in
the area of the Competitive Set and to keep the Leased Property in compliance
with the applicable provisions of the Franchise Agreement. The Capital
Expenditure Budget shall include without limitation, the expenditures required,
necessary and/or anticipated for the repair, replacement or refurbishment of
carpet, soft goods, FF&E and structural and mechanical items, alterations to
the Leased Property (but only in accordance with Section 10.1 hereof),
reconstruction in the event of damages or destruction of the Leased Property
(but only in accordance with Section 14 hereof), restoration pursuant to a
Taking (but only in accordance with Section 15 of this Lease), other required
or desirable capital improvements to the Leased Property or any of the
components, other required or desirable capital improvements to the Leased
Property or any of the components, other required or desired working capital,
and such other items characterized as capital expenditures under the Uniform
System (excluding, however, items required to be maintained at Lessor's cost
pursuant to Section 9.1.2 of this Lease). Lessor shall maintain a separate
interest bearing account referred to as the Capital Expenditure Reserve Account
from which all costs and expenses reflected in an approved Capital Expenditure
Budget should be paid; provided, however, Lessee shall be an authorized
signatory on such account. Effective October 1, 1996, Lessor shall, within
five (5) days of its receipt of the monthly profit and loss statement described
in Section 25(b)(3) hereof, fund into the Capital Expenditure Reserve Account,
an amount equal to six percent (6%) of the Gross Room Revenues for the
preceding month (pro-rated for any partial calendar month). Lessee understands
and agrees that after the approval by Lessor of any annual Capital Expenditure
Reserve Budget, no monies can be expended from the Capital Expenditure Reserve
Account for the applicable year which were not reflected in that year's annual
Capital Expenditure Budget (or if such expenditures were reflected on the
applicable budget, but were underestimated) without the prior written consent
of Lessor, which will not be unreasonably withheld or delayed; provided, that
in the event of an emergency necessitating expenditures for the protection of
life or health or the protection of the Leased Property (a) Lessee shall
immediately pay or incur the costs and expenses in its reasonable judgment
necessary to insure such protection and irrespective of whether such sums are
reflected on the applicable Capital Expenditure Budget, and (b) Lessor shall
fund additional monies into the Capital expenditure Revenue Account with regard
to same if monies in said account are insufficient to pay the costs and
expenses associated with such emergency. In addition to those statements
required by Section 25 hereof, Lessee agrees during the Term hereof to provide
to Lessor monthly reports and invoices as to the expenditures made from the
Capital Expenditure Reserve Account for the operations of the Leased Property
for the immediately preceding month.
(C) Lessor represents and warrants to the best of its knowledge, that
the Leased Property is in full compliance with the Americans With Disabilities
Act and all rules and regulations promulgated thereunder or in connection
therewith (the "ADA Act") and has received no notice from any governmental
authority, or complaint for allegation from any third party asserting that the
Leased
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Property is not in full compliance with the ADA Act.
4. As of the Effective Date, the Lease Agreement is hereby amended
by the deletion therefrom of Exhibit D in its entirety, and in place of and in
substitution therefor, a new Exhibit D added, said new Exhibit D is attached
hereto as Exhibit "B" and incorporated herein by reference for all purposes.
5. Except as amended hereby, the Lease Agreement remains unchanged,
in full force and effect, and the binding obligation of Lessor and Lessee.
Capitalized terms used herein and not otherwise defined shall have the meanings
asserted thereto in the Lease Agreement.
Executed effective as of the aforementioned Effective Date.
Lessor:
HOST FUNDING, INC., a Maryland
corporation
By: /s/ XXXXXXX X. XXXXXXX
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Xxxxxxx X. XxXxxxx, President
LESSEE:
CROSSROADS HOSPITALITY TENANT
COMPANY, L.L.C., a Delaware limited
liability company
By: /s/ XXXXX X. XXXXXXXX
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Xxxxx X. Xxxxxxxx, President
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EXHIBIT "A"
EXHIBIT G
(Rock Falls, Illinois)
Lessor's Contribution for Deferred Maintenance Costs $31,424.00*
Lessee's Contribution for Deferred Maintenance Costs $15,750.00
* Less amounts impounded with CS First Boston Mortgage Capital Corp. for
FF&E Reserves.
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EXHIBIT "B"
EXHIBIT D BASE RENT MONTHLY SCHEDULE
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC TOT
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- --------
ROCK FALLS
IL $13,300 $10,500 $14,600 $15,900 $19,300 $20,100 $20,300 $21,600 $20,100 $17,600 $15,100 $12,100 $200,500
Lessor and Lessee agree that during the Fiscal Year 1996, Monthly Base Rent due
to Lessor from Lessee will be adjusted using the following formula:
Monthly Base Rent
reduced by
One Percent (1%) of Monthly Gross Room Revenue
Commencing December 1996, the base rent for the months of March, June,
September and December are to be increased by an amount equal to $125.00 per
room (pro rated for any partial calendar quarter) contained within the Leased
Property; Commencing with 1998, this amount will be increased annually by the
percentage increase of the average daily room rate for the previous year for
the Leased Property. However, at no time is this amount to be more than $250.00
per room per quarter.
