REUNION HOSPITALITY TRUST, INC.
Exhibit 10.3
, 2010
Ladies and Gentlemen:
This letter sets forth the agreement (the “Agreement”) between Reunion Hospitality
Trust, Inc., a Maryland Corporation (the “Company”), and [NAME OF SPONSOR] (the
“Sponsor”), in connection with the services to be provided by the Sponsor. The Company
expects to complete an initial public offering of its common stock pursuant to a Registration
Statement (the “Registration Statement”) on Form S-11 (File No. 333-165622) (the
“Offering”), and this letter will confirm the agreement between the Company and the Sponsor
that, commencing on the date of the consummation of the Offering (the “Effective Date”) and
continuing until the earlier of the Company’s liquidation and dissolution or December 31, 2011, the
Sponsor shall:
| (i) | provide administrative services as may be required by the Company from time to time, including the administration of the Company’s day-to-day activities; | ||
| (ii) | provide office space to the Company for use by the Company’s employees and service providers for purposes of conducting the Company’s business; | ||
| (iii) | advance any salaries or direct third-party out-of-pocket expenses in connection with the Company’s commitments to its employees (including, without limitation, health, vision, dental, disability and life insurance benefits); | ||
| (iv) | perform accounting and comptroller-related services for the Company, including correspondence with the Company’s auditors; | ||
| (v) | provide investment advisory services to the Company, including, without limitation: |
| (a) | financial advice and services in connection with potential Permitted Investments (as described in the prospectus (the “Prospectus”) contained in the Registration Statement); | ||
| (b) | financial advice and services in connection with public or private equity and debt financing; | ||
| (c) | financial advice and services, including assistance with respect to matters such as cash management, treasury and financial controls; | ||
| (d) | corporate planning and corporate development advice and services; | ||
| (e) | strategic planning, including with respect to Permitted Investments; | ||
| (f) | public relations and press relations advice and services; and | ||
| (g) | such other advice and services necessitated by the ordinary course of the Company’s business, as the Company may reasonably request from time to time; and |
| (vi) | advance funds to the Company at such times and in such amounts as agreed to between the Company and the Sponsor. |
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The Sponsor will not receive any compensation under this Agreement, but will be entitled to
certain reimbursements as described below. The Company undertakes to reimburse the Sponsor, monthly
in arrears, reasonable, direct third-party out-of-pocket expenses incurred by the Sponsor in
performing the services under this Agreement (any such expenses being hereinafter referred to as
“Reimbursable Expenses”). The Company also undertakes to repay, as soon as practicable, any
advances of organizational or offering expenses that were made by the Sponsor and/or its affiliates
to the Company prior to the completion of the Offering. Furthermore, to the extent the Sponsor pays
any salaries or direct third-party out-of-pocket expenses in connection with the Company’s
commitments to its employees (including, without limitation, health, vision, dental, disability and
life insurance benefits), the Sponsor will not be entitled to be reimbursed for such salaries or
direct third-party out-of-pocket expenses, except that the Sponsor may be reimbursed for any
additional compensation approved by the compensation committee of the board of directors of the
Company, or to the extent applicable, the board of directors of the Company. The Company shall be
responsible for any third-party out-of-pocket expenses incurred in connection with the pursuit of
Permitted Investments, with such expenses funded out of the proceeds in the Company’s escrow
account (as described in the Prospectus). Until such time as the Capital Deployment Hurdle is
satisfied or the Tender Offer (as defined below) is completed, the funds needed to fund
Reimbursable Expenses will be provided solely from Non-Escrowed Proceeds and other Permitted
Investment Withdrawals (as such terms are defined in the Prospectus). Any expenses incurred or
advances made by the Sponsor which constitute Reimbursable Expenses and which are in excess of the
funds constituting Non-Escrowed Proceeds or Permitted Investment Withdrawals will not be repaid to
the extent that the full amount of remaining proceeds in the escrow account are used to tender for
the Company’s common stock and pay related expenses, as described in the Prospectus, in connection
with the Company’s failure to satisfy the Capital Deployment Hurdle by December 28, 2011 (the
“Tender Offer”). If the Company satisfies the Capital Deployment Hurdle by December 28, 2011 and
all funds are released from the escrow account, any Reimbursable Expenses not previously repaid
from Non-Escrowed Proceeds and other Permitted Investment Withdrawals may be repaid from the funds
previously held in the escrow account.
The Sponsor acknowledges the Company will establish the escrow account with the net proceeds
of the Offering and the concurrent private placement (as described in the Prospectus) for the
benefit of the stockholders of the Company that participate in the Offering, and hereby agrees that
the Sponsor or any of its valid assigns will not have any right, title, interest or claim of any
kind in or to any monies in any escrow account (each a “Claim”), and hereby waives any
Claim it may have in the future prior to the closing of the escrow account as a result of, or
arising out of, any negotiations, contracts or agreements with the Company, including this
Agreement and the transactions contemplated hereby, and will not seek recourse against the escrow
account for any reason whatsoever.
[Signature page follows]
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| Very truly yours, REUNION HOSPITALITY TRUST, INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| AGREED TO AND ACCEPTED BY: |
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| By: | ||||
| Name: | ||||
| Title: | ||||
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