1
EXHIBIT 10.10
Form of Contribution Agreement:
(All Agreements dated June 18, 1996, except the Agreement with the Xxxxxxx X.
Xxxxxxx Revocable Living Trust which is dated June 10, 1996)
1. Xxxxxxx X. Xxxxxx Revocable Living Trust
2. Xxxxx X. Xxxxxx Trust
3. Xxxxxxx X. Xxxxxxx Revocable Living Trust
4. Xxxxxx X. Xxxxx Revocable Living Trust
5. M & P Partners
6. XXX-JVJ Trust
7. Xxxxxx X. Xxxxxxxx Revocable Living Trust
8. X. X. Xxxxxx Revocable Living Trust
2
Schedule of Loan Receivable
Section 2 Balance on Loan Receivable:
Percentage
Interest Principal Interest Total
--------- ---------- ------------- -----------
1. M & P Partners 1.0% $15,686.96 $ 32,300.51 $ 47,987.47
2. X. X. Xxxxxx Revocable Living Trust 4.0 62,747.84 129,202.04 191,949.88
3. Xxxxxx X. Xxxxx Revocable Living Trust 4.0 62,747.84 129,202.04 191,949.88
4. Xxxxx X. Xxxxxx Trust 31.6 495,707.93 1,020,696.07 1,516,404.00
5. Xxxxxxx X. Xxxxxx Revocable Living Trust 55.4 869,058.00 1,789,447.00 2,658,505.00
6. Xxxxxx X. Xxxxxxxx Revocable Living Trust 2.0 31,373.92 64,601.02 95,974.94
7. Xxxxxxx X. Xxxxxxx Revocable Living Trust 2.0 31,373.92 64,601.02 95,974.94
The DAV-JVJ Trust's Contribution Agreement is substantially identical to the
Form of Contribution Agreement attached hereto, except there are no provisions
relating to: (i) The Loan Receivable; (ii) New York Transfer Taxes; and (iii)
Buffalo Future Development Parcel (Section 15).
3
Schedule of Consideration for Partnership Interests:
(Section 3)
1. Xxxxxxx X. Xxxxxx Revocable Living Trust $7,064,500
2. Xxxxx X. Xxxxxx Trust $4,322,280
3. Xxxxxxx X. Xxxxxxx Revocable Living Trust $ 247,120
4. Xxxxxx X. Xxxxx Revocable Living Trust $ 494,240
5. M & P Partners $ 88,500
6. XXX-JVJ Trust $ 42,000
7. Xxxxxx X. Xxxxxxxx Revocable Living Trust $ 247,120
8. X. X. Xxxxxx Revocable Living Trust $ 494,240
4
Schedule of Allocation -- Section 4:
Beachwood Buffalo and Columbus
--------- --------------------
1. Xxxxxxx X. Xxxxxx Revocable Living Trust $1,393,000 $5,671,500
2. Xxxxx X. Xxxxxx Trust 1,085,280 3,237,000
3. Xxxxxxx X. Xxxxxxx Revocable Living Trust 43,120 204,000
4. Xxxxxx X. Xxxxx Revocable Living Trust 86,240 408,000
5. M & P Partners 21,000 67,500
6. XXX-JVJ Trust [Not Applicable]
7. Xxxxxx X. Xxxxxxxx Revocable Living Trust 43,120 204,000
8. X. X. Xxxxxx Revocable Living Trust 86,240 408,000
5
Xxxxxxx X. Xxxxxx Revocable Living Trust
EXHIBIT A
---------
Interest Partnership Hotel Name
-------- ----------- ----------
27.85% Buffalo Hotel Joint Buffalo Marriott
Venture
27.7% Columbus Hotel Joint Columbus Marriott North
Venture
32.3375% Beachwood Hotel Joint Cleveland Marriott East
Venture
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Xxxxx X. Xxxxxx Trust
EXHIBIT A
---------
Interest Partnership Hotel Name
-------- ----------- ----------
15.9% Buffalo Hotel Joint Buffalo Marriott
Venture
15.8% Columbus Hotel Joint Columbus Marriott North
Venture
25.194% Beachwood Hotel Joint Cleveland Marriott East
Venture
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Xxxxxxx X. Xxxxxxx Revocable Living Trust
EXHIBIT A
---------
Interest Partnership Hotel Name
-------- ----------- ----------
1.0% Buffalo Hotel Joint Buffalo Marriott
Venture
1.0% Columbus Hotel Joint Columbus Marriott North
Venture
1.001% Beachwood Hotel Joint Cleveland Xxxxxxxx Xxxx
Xxxxxxx
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0
Xxxxxx X. Xxxxx Revocable Living Trust
EXHIBIT A
---------
Interest Partnership Hotel Name
-------- ----------- ----------
2.0% Buffalo Hotel Joint Buffalo Marriott
Venture
2.0% Columbus Hotel Joint Columbus Marriott North
Venture
2.002% Beachwood Hotel Joint Cleveland Marriott East
Venture
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M & P Partners
EXHIBIT A
---------
Interest Partnership Hotel Name
-------- ----------- ----------
0.25% Buffalo Hotel Joint Buffalo Marriott
Venture
0.5% Columbus Hotel Joint Columbus Marriott North
Venture
0.4875% Beachwood Hotel Joint Cleveland Marriott East
Venture
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XXX-JVJ Trust
EXHIBIT A
---------
Interest Partnership Hotel Name
-------- ----------- ----------
0.975% Beachwood Hotel Joint Cleveland Marriott East
Venture
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X. X. Xxxxxx Revocable Living Trust
EXHIBIT A
---------
Interest Partnership Hotel Name
-------- ----------- ----------
2.0% Buffalo Hotel Joint Buffalo Marriott
Venture
2.0% Columbus Hotel Joint Columbus Marriott North
Venture
2.002% Beachwood Hotel Joint Cleveland Marriott East
Venture
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Xxxxxx X. Xxxxxxxx Revocable Living Trust
EXHIBIT A
---------
Interest Partnership Hotel Name
-------- ----------- ----------
1.0% Buffalo Hotel Joint Buffalo Marriott
Venture
1.0% Columbus Hotel Joint Columbus Marriott North
Venture
1.001% Beachwood Hotel Joint Cleveland Marriott East
Venture
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All Agreements
--------------
EXHIBIT B
---------
Ownership
Entity Partners in Entity
------ -------- ---------
JVJ Buffalo Joint Venture R.E. Xxxxxx Trust 55.700%
X.X. Xxxxxx Trust 31.800%
M&P Partners 0.500%
X.X. Xxxxxx Trust 4.000%
X.X. Xxxxx Trust 4.000%
X.X. Xxxxxxx Trust 2.000%
X.X. Xxxxxxxx Trust 2.000%
--------
Entity Total 100.000%
========
General Ownership
Entity Partners in Entity
------ -------- ---------
JVJ Columbus Joint Venture R.E. Xxxxxx Trust 55.400%
X.X. Xxxxxx Trust 31.600%
M&P Partners 1.000%
X.X. Xxxxxx Trust 4.000%
X.X. Xxxxx Trust 4.000%
X.X. Xxxxxxx Trust 2.000%
X.X. Xxxxxxxx Trust 2.000%
--------
Entity Total 100.000%
========
Ownership
Entity Partners in Entity
------ -------- ---------
JVJ Beachwood Joint Venture R.E. Xxxxxx Trust 49.750%
X.X. Xxxxxx Trust 38.760%
DAV-JVJ Trust 1.500%
M&P Partners 0.750%
X.X. Xxxxxx Trust 3.080%
X.X. Xxxxx Trust 3.080%
X.X. Xxxxxxx Trust 1.540%
X.X. Xxxxxxxx Trust 1.540%
--------
Entity Total 100.000%
========
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CONTRIBUTION AGREEMENT
----------------------
THIS CONTRIBUTION AGREEMENT (this "Agreement"), made as of the
____ day of ____, 1996, by and between __________________, TRUSTEE of the
__________________________________________________ ("Assignor"), and XXXXXX ARES
HOTEL PROPERTIES, L.P., an Ohio limited partnership ("Assignee"),
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, Assignor owns a general partnership interest
in __________________________, (the "JVJ Joint Ventures");
WHEREAS, Assignor agrees at the time of the Closing (as
hereinafter defined) to take all action necessary to effectuate the distribution
of (i) the interest held by the JVJ Joint Ventures in the partnership listed on
Exhibit A attached hereto and made a part hereof (the "Partnership") and (ii)
the Loan Receivable (as hereafter defined), from the JVJ Joint Ventures to the
Assignor and the other Partners of the JVJ Joint Ventures;
WHEREAS, after said distribution, Assignor will own the
percentage of general partnership interest (the "Partnership Interests") in the
Partnership shown on Exhibit A;
WHEREAS, the Partnership owns the property listed on Exhibit A
attached hereto and made a part hereof (individually a "Property" and
collectively the "Properties"); and
WHEREAS, after said distribution, Assignor will own a __%
interest in a certain loan to Columbus Hotel Joint Venture pursuant to
advances made by JVJ Columbus Joint Venture in the aggregate principal amount
of $1,568,696, which at December 31, 1995, represented a total balance of
principal and accrued interest of $4,798,747 (the "Loan Receivable");
WHEREAS, Assignee desires to acquire from Assignor, and
Assignor desires to assign the Partnership Interests to Assignee, on the terms
and subject to the conditions hereinafter stated; and
WHEREAS, Assignee has agreed to cause Columbus Hotel Joint
Venture to pay Assignor his percentage share of the Loan Receivable, on the
terms and subject to the conditions hereinafter stated;
NOW, THEREFORE, for good and valuable consideration received
to the full satisfaction of each of them, the parties agree as follows:
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1. TRANSFER OF PARTNERSHIP INTEREST. Upon the terms and
subject to the conditions set forth herein, Assignor agrees to convey, transfer,
assign and deliver to Assignee at the Closing, and Assignee agrees to accept an
assignment from Assignor at the Closing, all of Assignor's right, title, estate
and interest in and to the Partnership Interests, free and clear of all liens,
security interests and encumbrances whatsoever.
2. PAYMENT OF LOAN RECEIVABLE. Upon the terms and subject to
the conditions set forth herein, Assignee agrees to cause Columbus Hotel Joint
Venture to pay Assignor his percentage share of the Loan Receivable at Closing.
Assignor agrees that as of December 31, 1995, the balance due on Assignor's
percentage share of the Loan Receivable was $__________, consisting of
$_________ of principal and $__________ of interest, which sum shall increase
until the Closing, based upon additional amounts advanced, if any, and accrued
interest at the rate of 10% per annum, compounded annually and shall decrease
until the Closing, based upon any payments made on the Loan Receivable.
3. CONSIDERATION FOR PARTNERSHIP INTEREST. The consideration
to be paid by Assignee for the Partnership Interest shall be __________________
___________________ ($______________), plus or minus the amount of the Capital
Adjustment (as hereinafter defined), and less the following: the Loan
Receivable Payment, the New York Transfer Taxes and the CIGNA Prepayment
Penalty, if any, as such term is defined below.
The "Capital Adjustment" shall be Assignor's percentage share
of any capital contributions from the date hereof until the Closing with respect
to the Partnership Interest, decreased by Assignor's percentage share of any
distributions from the date hereof until the Closing with respect to the
Partnership Interest.
The "Loan Receivable Payment" shall be Assignor's percentage
share of the amount paid at Closing to repay the Loan Receivable as set forth
in Section 2 of this Agreement.
The "New York Transfer Taxes" shall be the sum of the New
York State Real Property Transfer Gains Tax, the New York State Real Property
Transfer Tax, the Erie County, New York Transfer Tax and any successor taxes
thereto appliable and to the transfer of Assignor's percentage interest in
Buffalo Hotel Joint Venture or the Buffalo Marriott Property.
The "CIGNA Prepayment Penalties" shall be an amount equal to
the sum of (a) Assignor's percentage interest in Buffalo Hotel Joint Venture as
shown on Exhibit A multiplied by the actual amount of the prepayment penalty
paid to Connecticut General Life Insurance Company in connection with the
payoff, if any, at Closing of its loan to Buffalo Hotel Joint Venture in the
approximate aggregate amount of $14.6 million, and (b) Assignor's percentage
interest in Beachwood Hotel Joint Venture as shown on Exhibit A multiplied by
the actual amount of prepayment penalty paid to Connecticut General Life
Insurance Company in connection with the payoff, if any, at Closing of its loan
to Beachwood Hotel Joint Venture in the approximate aggregate amount of $28.5
million.
The sum of the payment for the Loan Receivable and the
consideration for the Partnership Interests shall be payable by wire transfer
in immediately available federal funds at Closing, which payment is conditional
upon the completion of the offering to the public of common shares ("Shares")
of stock (the "IPO") by the general partner of the Assignee and the closing
conditions set forth in Section 7 of this Agreement.
In the event of the completion of the IPO as described
aforesaid, the Assignee shall be obligated, subject to the closing conditions
set forth in Section 7 of this Agreement, to acquire the Partnership Interests
and to cause Columbus Hotel Joint Venture to make payment of Assignor's
percentage share of the Loan Receivable to Assignor and the other general
partners in the JVJ Joint Ventures, all of whom are listed on Exhibit B,
attached hereto and made a part hereof.
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4. OPTIONAL ALTERNATIVE FORM OF CONSIDERATION FOR PARTNERSHIP
INTEREST. At least thirty (30) days prior to the filing of a Registration
Statement (the "Registration Statement") with the Securities and Exchange
Commission with respect to the IPO, Assignee shall send a written offer,
together with copies of the most recent drafts of the Registration Statement,
Limited Partnership Agreement of Assignee and Registration Rights Agreement, if
any, to Assignor, providing for an optional alternative form of consideration
with respect to the acquisition of the Partnership Interest (the "Offer"). Such
optional alternative form of consideration shall consist of a Limited
Partnership interest in Assignee (the "Units"). An Offer of Units shall be made
to Assignor based upon the cash consideration for the Partnership Interest
described in Section 3. The number of Units (which shall be exchangeable on a
one-to-one basis with the Shares) to be provided by Assignee shall equal the
same number of Shares
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which will be issued at the time of the IPO for the equivalent cash amount,
which number shall be computed by dividing the cash consideration for the
Partnership Interest specified in Section 3 by the price per share of the Shares
of the general partner of the Assignee, as such price is set forth in that
entity's final Prospectus filed with the Securities and Exchange Commission.
Notwithstanding the foregoing, Assignor shall have the option of electing to
take Units for only a portion of the Partnership Interest and cash for the other
portion, on the basis of valuing the Partnership Interests in Beachwood Hotel
Joint Venture separately from a collective valuation of the Partnership
Interests in Buffalo Hotel Joint Venture and Columbus Hotel Joint Venture. The
parties agree that the total consideration for the Partnership Interests shall
be allocated $_________ to Beachwood and $_________ to Buffalo and Columbus,
subject to the Capital Adjustment and subject to deductions for the Loan
Receivable Payment, the New York Transfer Taxes and the CIGNA Prepayment
Penalties, if any.
If the Offer is not accepted by Assignor within ten (10) days
of the date that the Offer is received, said Offer shall be deemed revoked and
of no further force and effect.
The Units represented by the Offer shall be the same in form,
terms, conditions, registration rights, exchange or conversion rights and
distribution rights as Units received by Xxxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxx,
Xxxx X. Xxxxxx and any member of their respective immediate families or any
trusts for their or their families' benefit (collectively, the "Xxxxxx Family").
If Assignor elects to accept the alternative consideration of Units, Assignor
shall be required to execute similar documents to those executed by any member
of the Xxxxxx Family who elects to take Units. Assignee shall extend to Assignor
the same opportunities to structure the acquisition ofthe Units so as to avoid
the recognition of taxable income or gain upon the exchange as are extended to
the Xxxxxx Family. Notwithstanding the foregoing, in the event that following
the election by Assignor to receive Units
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in exchange for some or all of the Partnership Interest, the opportunity to
structure the acquisition of the Units so as to avoid the recognition of taxable
income or gain by Assignor is not available to Assignor for whatever reason,
then Assignor shall have the right, exercisable within ten (10) days after
Assignor has been made aware of a change in law or facts that prevents such an
opportunity from being realized by written notice to Assignee, to inform
Assignee of his revocation of the election to take such Units and, therefore,
shall receive the consideration for the Partnership Interest in cash.
5. ASSIGNOR'S REPRESENTATIONS AND WARRANTIES. Assignor
hereby represents and warrants to Assignee as of the date hereof that:
(a) Assignor is the sole trustee of the _____________________
_________________ (the "Trust"), and that the investment powers of the
Trust permit the Assignor, as trustee, to enter into this Agreement.
(b) Assignor has all necessary power and authority to enter
into this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby, without the consent or
authorization of, or notice to, any third party, except those third
parties to whom such consents or authorizations have been or will be
obtained, or to whom notices have been or will be given, prior to the
Closing. This Agreement constitutes, and the other documents and
instruments to be delivered by Assignor pursuant hereto
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when delivered will constitute, the legal, valid and binding
obligations of Assignor, enforceable against Assignor in accordance
with their respective terms.
(c) To the best of Assignor's knowledge, there is no
litigation, proceeding or action pending or threatened against or
relating to Assignor which might materially and adversely affect
Assignor or which questions the validity of this Agreement or any
action taken or to be taken by Assignor pursuant hereto.
(d) Neither the execution of this Agreement nor the
consummation of the transactions contemplated hereby will, in any
material respect, constitute a violation of or be in conflict with or
constitute a default under any term or provision of any agreement,
instrument or lease to which Assignor is a party.
(e) At Closing, Assignor will own good, valid and marketable
title to the Partnership Interest, free and clear of all mortgages,
pledges, liens, security interests, encumbrances and restrictions of
any nature whatsoever.
(f) To the best of Assignor's knowledge, the only
partners of the JVJ Joint Ventures are the general partners
listed on Exhibit B.
Subject to Section 10 hereof, Assignor also makes the further
representation that nothing in this Agreement shall operate to release Assignor
from any liabilities or obligations for which he would otherwise be responsible
arising out of or in connection
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with the ownership of the Partnership Interest or the Property relating to any
periods prior to the Closing.
All of the representations and warranties set forth in this
Section 5 shall be deemed renewed by Assignor on the Closing Date as if made at
such time.
6. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee
represents and warrants to Assignor that:
(a) Assignee is, and will be at the Closing, a limited
partnership duly organized, validly existing and in good standing under
the laws of the State of Ohio and is, or at Closing will be, registered
as a foreign limited partnership in each jurisdiction in which it is
engaging in business or expects to do so. Assignee has, and at the
Closing will have, the power and authority to carry on the business for
which it has been organized. The persons executing this Agreement on
behalf of Assignee are duly authorized to do so, and all requisite
action has been taken by Assignee to authorize the execution and
delivery of this Agreement, the performance by Assignee of its
obligations hereunder and the consummation of the transactions
contemplated hereby.
(b) To the best of Assignee's knowledge, there is no
litigation, proceeding or action pending or threatened against or
related to Assignee which might materially and adversely Assignee or
which questions the validity of this Agreement or any action taken or
to be taken by Assignor pursuant hereto.
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(c) Assignee has all necessary power and authority to enter
into this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby, without the consent or
authorization of, or notice to, any third party, except those third
parties to whom such consents or authorizations have been or will be
obtained, or to whom notices have been or will be given, prior to the
Closing. This Agreement constitutes, and the other documents and
instruments to be delivered by Assignee pursuant hereto when delivered
will constitute, the legal, valid and binding obligations of Assignee,
enforceable against Assignee in accordance with their respective terms.
(d) Neither the execution of this Agreement nor the
consummation of the transactions contemplated hereby will, in any
material respect, constitute a violation of or be in conflict with or
constitute a default under any term or provision of any agreement,
instrument or lease to which Assignee is a party.
(e) The Xxxxxx Family is not and will not be receiving more
favorable terms or treatment than Assignor with respect to the release
from or assumption of (and indemnification against) obligations,
liabilities and claims in connection with any sale, assignment,
transfer or contribution of assets or other property to Assignee.
All of the representations and warranties set forth in this
Section 6 shall be deemed renewed by Assignee on the Closing
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Date as if made at such time and shall survive the closing of the transactions
contemplated hereby for a period of six months.
6. DELIVERIES; CONDITIONS.
(a) Assignor shall execute and deliver to Assignee, on or
prior to the Closing Date a good and sufficient Assignment and
Assumption of Partnership Interest, in the form attached hereto as
Exhibit C, conveying, selling, transferring, assigning and delivering
to Assignee good and marketable title to the Partnership Interest, in
the condition referenced in Section 1 (the "Assignment Agreement") and
(ii) written evidence of full satisfaction of the Loan Receivable.
(b) Assignee shall issue or deliver the following to
or for the benefit of Assignor on or prior to the Closing Date:
(i) the amount required to prepay the Loan
Receivable in full, by wire transfer of
immediately available federal funds;
(ii) the consideration for the Partnership
Interest, by wire transfer of immediately
available federal funds, or payable in the
manner determined pursuant to Section 3 or
Section 4 hereof, or both;
(iii) duly executed resolutions adopted by
Assignee authorizing the execution and
delivery of this Agreement by Assignee,
the performance by Assignee of its
obligations hereunder and the
consummation of the transactions
contemplated hereby;
(iv) the Assignment Agreement duly executed
by Assignee;
(v) the releases required pursuant to Section 10
hereof; and
(vi) the Marriott Consent (as hereinafter
defined).
(c) The effectiveness of this Agreement is conditioned upon
all other partners of the JVJ Joint Ventures executing and
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delivering to Assignee identical (except for amount of consideration)
forms of a Contribution Agreement.
8. CLOSING DATE. Unless the parties otherwise agree in
writing, the transactions contemplated hereby shall be closed (the "Closing")
simultaneously with the completion of the IPO, provided such offering occurs on
or before August 15, 1996 (the "Closing Date"). If the Closing has not occurred
by the Closing Date, this Agreement shall terminate, in which event all
documents and instruments which may have been delivered by one party to the
other party shall be returned, and neither party hereto shall thereafter be
under any further liability to the other party hereto.
9. CERTAIN EXPENSES AND CHARGES. Assignee shall be
charged the following amounts at Closing: the Purchase Price, and all other
costs and expenses necessary to effect the purchase of the Partnership
Interest and the satisfaction of the Loan Receivable. Assignee shall also be
charged with and shall pay any and all Ohio conveyance fees and/or transfer
taxes in the event Assignee desires to directly acquire, pursuant to Section 13
hereof, the Properties located in the State of Ohio.
10. RELEASES; INDEMNIFICATION.
(a) Assignee shall use reasonable efforts to attempt to obtain
releases of Assignor (in form and substance acceptable to Assignor in
his reasonable discretion) and to the extent such releases are not
obtained, hereby agrees to assume and indemnify Assignor, from any and
all personal liability to any lenders of the Partnership that accrues
from and after the Closing Date.
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(b) Assignee shall fully indemnify and hold Assignor and
Assignor's trustee, heirs, representatives, successors and assigns
harmless from and against any and all claims, demands, losses,
liabilities, damages and expenses (including reasonable attorneys'
fees) arising out of or in connection with (i) the failure of Assignee
to perform in any material respect any of its obligations hereunder,
(ii) the inaccuracy of any representation or warranty made by Assignee
hereunder (except to the extent that such indemnification obligation
would arise directly as a result of the inaccuracy of any
representation, warranty or covenant made by Assignor hereunder), and
(iii) the activity of the Partnership and/or the operation of the
Property from and after the Closing.
(c) Assignee shall cause the current management agreement for
the Property to be terminated as of the Closing Date and shall provide
a written release of the Partnership from the manager and Assignee
shall obtain from Marriott International, Inc. a written consent to
all of the transactions contemplated by this Agreement (the "Marriott
Consent").
(d) Assignor shall fully indemnify Assignee and hold Assignee,
its officers, directors and partners and their respective
representatives, successors and assigns harmless from and against any
and all claims, demands, losses, liabilities, damages and expenses
(including reasonable attorneys' fees) arising out of or in connection
with (i) the
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failure of Assignor to perform in any material respect any of its
obligations hereunder or (ii) the inaccuracy of any representation or
warranty made by Assignor hereunder (except to the extent that such
indemnification obligation would arise directly as a result of the
inaccuracy of any representation, warranty or covenant made by
Assignee hereunder).
11. SECURITIES ACT INDEMNITY. Assignee agrees to defend, protect,
indemnify, and hold harmless Assignor from and against any and all losses,
claims, damages and liabilities (including, without limitation, any legal or
other expenses reasonably incurred by Assignor in connection with defending or
investigating any such action or claim except to the extent that such
indemnification obligation would arise directly as a result of the inaccuracy of
any representation or warranty or the breach of any covenant or obligation of
Assignor hereunder), including any of the foregoing incurred in settlement of
any litigation, commenced or threatened, arising out of or based on any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, including the Preliminary
Prospectus and the final prospectus filed with the SEC pursuant to Rule 424(b)
promulgated under the Securities Act of 1933 (the "Securities Act") (the "Final
Prospectus") contained therein (as amended or supplemented, if applicable) or
any other document contained therein, or based on any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading,
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or any violation by Assignee or its general partner of the Securities Act or
the Securities Exchange Act of 1934 (the "Exchange Act") or any rule or
regulations promulgated thereunder applicable to Assignee or its general
partner (collectively, the "Indemnified Matters"), and Assignee shall reimburse
Assignor for any legal and other expenses reasonably incurred in connection
with investigating, preparing or defending any such claim, loss, damage,
liability or action. Assignor shall give notice to Assignee promptly after
Assignor has actual knowledge of any claim as to which indemnity under this
Section 10 may be sought, and shall permit Assignee to assume the defense of
any such claim or any litigation resulting therefrom, provided that Assignor
may participate in such defense at its expense, and provided further that
Assignee shall not assume the defense for matters as to which there is a
conflict of interest or separate and different defenses. Assignee, in
the defense of any such claim or litigation, shall not, except with the consent
of Assignor, consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to Assignor a release from all liability in respect to
such claim or litigation.
12. CONSENTS. Assignee has entered into or will enter into
agreements to purchase other general partnership interests from other general
partners of the Partnership and hereby consents to each and every transaction
contemplated by this Agreement. Assignor hereby consents to (i) the transfer by
any general partner
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of the Partnership of such partner's Partnership Interest to Assignee or
Assignee's nominee, (ii) the transfer by the Partnership in connection with the
transactions contemplated by this Agreement, of all or substantially all the
assets of the Partnership, including, without limitation, the liquor licenses
and Franchise Agreement with Marriott Corporation, to Assignee or Assignee's
nominee and (iii) a waiver of any rights of first refusal, options or other
rights which could be asserted by Assignor in connection with any agreements
regarding the transfer of the Partnership Interest to Assignee or related to the
ownership or operation of the Property. Assignor also consents to the
substitution of Assignee as a partner in the Partnership upon completion of the
transfer referenced above. Assignor agrees to execute any documents and
instruments, and shall take or cause to be taken such further action, as may be
necessary at any time or from time to time in order to effectuate Assignor's
consent referenced herein.
In the event the Closing does not occur as provided in Section
8, the various consents referenced above shall be automatically deemed revoked
by Assignor and Assignor and Assignee agree to execute any documents and
instruments necessary in order to effect said revocation and to place Assignor
in the same position as if this Agreement had not been executed by Assignor.
13. ACQUISITION OF THE PROPERTY OR PROPERTIES. At any time
prior to ten (10) days before the Closing Date, Assignee may elect by written
notice to Assignor to acquire any or all of the Properties in lieu of the
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28
Partnership Interests (along with the payment of assignor's percentage share of
the Loan Receivable) for the Purchase Price. In such event, Assignor shall
provide the requisite consents to convey the Property or Properties to the
Assignee pursuant to the terms and conditions of this Agreement by causing the
Partnership to deliver to Assignee on the Closing Date a limited warranty deed
conveying to Assignee fee simple title to the Property or Properties. Assignor
shall also provide Assignee with such other action as Assignee shall reasonably
request in order to convey the Property or Properties to Assignee. Finally,
Assignor and Assignee agree to cause the liquidation of the JVJ Joint Ventures
and the Partnerships, as the case may be, in the event Assignee elects to
purchase the Property. If Assignor elects to take Units as a portion of the
Purchase Price, Assignee shall extend to Assignor the same opportunities to
structure the acquisition of the Units so as to avoid the recognition of
taxable income or gain upon the exchange as are extended to the Xxxxxx Family.
14. ASSIGNMENT. (a) Assignee has the right, upon five (5)
days' written notice to Assignor, to assign and transfer its interest in this
Agreement to an entity that is taxable as a partnership and that is controlled
by Assignee or the Xxxxxx Family. In such event, provided that any such
transferee agrees in writing to assume all of Assignee's obligations hereunder,
Assignee shall be released from any and all liability hereunder as of the
effective date of such assignment.
(b) Assignor has the right to assign his interest in the JVJ
Joint Ventures in accordance with the terms of the partnership agreement
governing the JVJ Joint Ventures and, if applicable, the
-15-
29
Partnerships, at any time prior to the Closing Date, and upon such assignment,
to assign his interest in this Agreement to the assignee of such interests in
the JVJ Joint Ventures and, provided such assignee agrees in writing to assume
all of Assignor's obligations hereunder, Assignor shall be released from any
and all liability hereunder as of the effective date of such assignment.
15. BUFFALO FUTURE DEVELOPMENT PARCEL. Assignee hereby agrees
to cause the Xxxxxx Family, prior to the Closing Date, to participate, with
Assignor and his other partners in JVJ Buffalo Joint Venture, in causing
Buffalo Hotel Joint Venture, an Ohio general partnership that is one of the
Partnerships, to grant, for the benefit of the owner(s) of the Future
Development Parcel (as hereinfafter defined) (collectively, the "Development
Parcel Owners"), such access and utility easements (the "Easements") over and
across the Buffalo Property as are necessary for the development of a parcel of
land, adjacent to the Buffalo Property, identified as the "Future Development
Parcel" in Section 57 of that certain Mortgage, Security Agreement and Fixture
Filings, dated as of January 29, 1996 (the "Mortgage"), granted by Buffalo
Hotel Joint Venture in favor of Connecticut General Life Insurance Company
("Lender"), and more particularly described on Exhibit D attached hereto and
made a part hereof. Assignor and Assigneee agree to cause the agreement
containing such easements to also contain a convenant from the Development
Parcel Owners restricting the Future Development Parcel from development as a
Hotel (as hereinafter defined), to be recorded in the Erie County, New York
Clerk's Office. Assignor and Assignee also agree to participate in causing
Lender to consent to the Easements and to subordinate the lien of the Mortgage
to the Easements. For purposes of this Agreement, the term "Hotel" shall mean a
hotel, motel, residence inn, suite inn, suite hotel or other similar type
multi-unit transient or temporary housing facility.
16. MISCELLANEOUS.
(a) This Agreement, including the Exhibits attached hereto,
shall be deemed to contain all of the terms and conditions agreed upon
with respect to the subject matter hereof, it being understood that
there are no outside representations or oral agreements.
(b) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors,
permitted assigns, heirs and personal representatives.
(c) The parties shall execute and deliver such further
documents and instruments of conveyance, sale, assignment, transfer or
otherwise, and shall take or cause to be taken such other or further
action as either party shall reasonably request at any time or from
time to time in order to effectuate the terms and provisions of this
Agreement.
-16-
30
(d) This Agreement shall be governed by and construed
in accordance with the laws of the State of Ohio.
(e) This Agreement will survive the Closing and the
delivery of the documents contemplated herein.
IN WITNESS WHEREOF, the parties hereto have signed three
counterparts of this Agreement, each of which shall be deemed to be an original
document, as of the date set forth above.
ASSIGNOR:
By: ______________________________
ASSIGNEE:
XXXXXX ARES HOTEL PROPERTIES, L.P.,
an Ohio limited partnership
By: Xxxxxx Ares Hotel Properties,
Inc., General Partner
By: _____________________________
Xxxxxx X. Xxxxxx, President
-17-
31
EXHIBIT A
---------
%
Interest Partnership Hotel Name
-------- ----------- ----------
-18-
32
EXHIBIT B
---------
Ownership
Entity Partners in Entity
------ -------- ---------
---------
Entity Total
=========
-19-
33
EXHIBIT C
---------
ASSIGNMENT AND ASSUMPTION OF
----------------------------
PARTNERSHIP INTEREST
--------------------
KNOW ALL PERSONS BY THESE PRESENTS, that _____________________________
______ ("Assignor"), for good and valuable consideration the receipt of which is
hereby acknowledged as being to Assignor's full satisfaction, does hereby sell,
convey and assign to XXXXXX ARES HOTEL PROPERTIES, L.P., an Ohio limited
partnership ("Assignee"), a _______ general partnership interest in ___________
___________________, an Ohio general partnership (the "Partnership"), and in and
to the Partnership Agreement forming the Partnership dated as of _______________
___________________, as may have been amended from time to time (as so amended,
the "Partnership Agreement").
Assignee hereby agrees to assume, discharge and release Assignor as
general partner of the Partnership to the extent of the interest hereby assigned
from, and agrees to indemnify Assignor against, all obligations which may accrue
from and after the date hereof by virtue of the Partnership or the Partnership
Agreement applicable to the interest hereby assigned and does further agree to
be bound by all the terms, conditions and provisions of the Partnership
Agreement and to be a general partner in the Partnership for all purposes and to
the full extent of the interest hereby assigned.
IN WITNESS WHEREOF, this Assignment and Assumption of Partnership
Interest has been executed by Assignor and Assignee as of the ____ day of
________, 1996.
ASSIGNOR:
By: ______________________________
ASSIGNEE:
XXXXXX ARES HOTEL PROPERTIES, L.P.,
an Ohio limited partnership
By: Xxxxxx Ares Hotel Properties,
Inc., General Partner
By: _____________________________
Xxxxxx X. Xxxxxx, President
-20-
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EXHIBIT D
---------
LEGAL DESCRIPTION OF FUTURE DEVELOPMENT PARCEL
----------------------------------------------
ALL that certain plot, piece or parcel of land, with the buildings and
improvements thereon erected, situate, lying and being in the Town of Amherst,
County of Erie and State of New York, being part of Xxx Xx. 00, Xxxxxxxx 00,
Xxxxx 7, of the Holland Land Company's Survey, bounded and described as
follows:
BEGINNING at the point of intersection of the southerly line of the
first parcel of land conveyed to Niagara Mohawk Power Corporation by deed
recorded in the Erie County Clerk's Office in Liber 5852 of Deeds at page 135
with the northeasterly line of the Power Line Expressway; running thence
southeasterly along said northeasterly line 677.01 feet to a monument; thence
continuing southeasterly and easterly along a curve to the left along said line
of the Power Line Expressway through 2 monuments, a total distance of 775.31
feet to a point in a line which is parallel to and 80 feet southwesterly at
right angles from the southwesterly line of lands conveyed to Niagara, Lockport
& Ontario Power Corporation by deed recorded in the Erie County Clerk's Office
in Liber 2145 of Deeds at page 535; running thence northwesterly along said
parallel line 1216 feet more or less to the first described southerly line of
Niagara Mohawk Power Corporation; thence westerly along said line 145.15 feet
to the point or place of beginning.
35
(All First Amendment to Contribution Agreement dated June 19, 1996, except
Xxxxxxx X. Xxxxxxx Revocable Living Trust which is dated June 10, 1996)
--------------------
SCHEDULE OF PARAGRAPH 5 TO First Amendment to Contribution Agreement:
FROM TO
---- --
1. Xxxxxxx X. Xxxxxx Revocable Living Trust $7,064,500 $8,104,700
2. Xxxxx X. Xxxxxx Trust $4,322,280 $5,040,200
3. Xxxxxxx X. Xxxxxxx Revocable Living Trust $ 247,120 $ 281,600
4. Xxxxxx X. Xxxxx Revocable Living Trust $ 494,240 $ 563,200
5. M & P Partners $ 88,500 $ 105,500
6. DAV-JVJ Trust $ 42,000 $ 60,000
7. Xxxxxx X. Xxxxxxx Revocable Living Trust $ 247,120 $ 286,600
8. X.X. Xxxxxx Revocable Living Trust $ 494,240 $ 563,200
36
FIRST AMENDMENT TO CONTRIBUTION AGREEMENT
-----------------------------------------
THIS FIRST AMENDMENT TO CONTRIBUTION AGREEMENT (the "Amendment"), made
as of the 19th day of June, 1996, by and between ____________________________
("Assignor"), and XXXXXX HOTEL PROPERTIES, L.P., an Ohio limited partnership
("Assignee"),
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, Assignor and Assignee entered into that certain Contribution
Agreement dated as of June 19, 1996 (the "Original Agreement"); and
WHEREAS, the parties have agreed to modify the Original Agreement in
certain respects and have entered into this Amendment to reflect those
agreements;
NOW, THEREFORE, for good and valuable consideration received to the
full satisfaction of each of them, the parties agree as follows:
1. The last sentence of Section 4 is hereby deleted in its
entirety and the following inserted in lieu thereof: "Notwithstanding the
foregoing, in the event that following the election by Assignor to receive
Units in exchange for some or all of the Partnership Interests, the opportunity
to structure the acquisition of the Units so as to avoid the recognition of
taxable income or gain by Assignor is not available to Assignor because of a
change outside of Assignor's control in law or facts after the date hereof,
then Assignor shall have the right, exercisable within ten (10) days after
Assignor has been made aware of that change in law or facts that prevents such
an opportunity from being realized, by written notice to Assignee at any time
up to five (5) days prior to the Closing Date, to inform Assignee of his
revocation of the election to take such Units and, therefore, shall receive the
consideration for the Partnership Interests in cash."
2. Section 4 of the Original Agreement is hereby further modified
by adding the following sentence at the end of such section: "As a material
inducement to Assignor's election to receive Units rather than cash, Assignee
covenants and agrees that with respect to the Amended and Restated Agreement of
Limited Partnership of Assignee, attached hereto as Exhibit A (the "OP
Agreement"), it will not, after the date hereof (a) change Section 5.3(a) of
the OP Agreement in a manner materially adverse to Assignor; (b) change Section
7.4 of the OP Agreement to (i) lengthen the time after the closing of the IPO
at which Assignor may require redemption of Partnership Units, (ii) reduce the
redemption price, (iii) lengthen the Payout Period, (iv) reduce the rate of
interest payable on the cash amount, (v) materially increase the minimum number
of Units for which the Redemption Right may be exercised, (vi) materially
impair or eliminate the rights of transferees of Assignors, (vii) alter the
rights of the general partner in Section 7.4(b) in a manner materially adverse
to the Assignor, or (viii) change the last sentence of Section 7.4(c) in a
manner materially adverse to the Assignor; (c) change Section 7.8 of the OP
Agreement in a manner materially adverse to Assignor; (d) change Section 8.1 of
the OP Agreement in a manner materially adverse to Assignor; or (e) change
Section 9.5
37
of the OP Agreement to prohibit or materially restrict any donative transfer
referred to in Section 9.5(d) or to otherwise impose materially greater
restrictions on Assignor's ability to transfer its limited partnership
interests."
3. Section 4 of the Original Agreement is hereby further modified
by adding the following paragraph at the end of such section: "In the event
Assignor elects to take all or a portion of the consideration for the
Partnership Interests in Units, at the sole election of Assignee, Assignee upon
written notice to Assignor, may elect to deposit (the "Deposit") a sum equal to
the lesser of: (a) five percent (5%) of the value of the Units to be paid to
Assignor or (b) $25,000. The amount of the Deposit (together with any interest
earned thereon) shall apply as a credit towards the Purchase Price. The
Deposit, if paid, shall be payable to Assignor by certified or bank check. In
the event the Closing does not occur as provided in Section 8, the Assignor
shall be obligated to return said Deposit, together with any interest earned
thereon, to Assignee by certified or bank check within ten days of such request
by Assignee."
4. Section 7(c) of the Original Agreement is hereby modified by
adding the following sentence at the end of such section: "Assignor's
obligation to close the transaction contemplated by this Agreement is
conditioned upon each of Assignee's covenants and agreements contained in this
Agreement to be performed or completed on or before the Closing Date having
been so performed and complied with on or before the Closing Date."
5. Section 8 of the Original Agreement is hereby deleted in its
entirety and the following inserted in lieu thereof: "Unless the parties
otherwise agree in writing, the transactions contemplated hereby shall be
closed (the "Closing") simultaneously with the completion of the IPO, provided
such offering is completed on or before August 15, 1996 (the "Closing Date").
Notwithstanding the foregoing sentence, Assignor hereby consents to an
extension of the Closing Date to not later than February 15, 1997 provided (i)
that a registration statement on Form S-11 has been filed with Securities and
Exchange Commission on or before August 15, 1996 and (ii) the total
consideration to be paid by Assignee to Assignor for the Partnership Interests
shall be increased from $______ to $______. If the Closing has not been
completed by the Closing Date, or as so may be extended, this Agreement shall
terminate, in which event all documents and instruments which may have been
delivered by one party to the other party shall be returned, and neither party
hereto shall thereafter be under any further liability to the other party
hereto."
6. Section 10(a) of the Original Agreement is hereby deleted in
its entirety and the following inserted in lieu thereof:
"(a) Assignee shall use reasonable efforts to attempt to obtain
releases of Assignor from any lenders of the Partnership in respect of any
and all personal liability of Assignor to such lenders accruing from and
after the Closing Date (in form and substance acceptable to Assignor in
his reasonable discretion) and to the extent such releases are not
obtained, hereby agrees to assume and indemnify Assignor, from any and
-2-
38
all personal liability to any lenders of the Partnerships that accrues from
and after the Closing Date."
7. Section 11 of the Original Agreement is hereby deleted in its
entirety and the following inserted in lieu thereof:
"SECURITIES ACT INDEMNITY. Assignee agrees to defend, protect,
indemnify, and hold harmless Assignor from and against any and all losses,
claims, damages and liabilities (including, without limitation, any legal or
other expenses reasonably incurred by Assignor in connection with defending or
investigating any such action or claim except to the extent that such
indemnification obligation would arise directly as a result of the inaccuracy
of any representation or warranty or the breach of any covenant or obligation
of Assignor hereunder), arising out of or based on any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or any amendment thereof, including the Preliminary Prospectus and
the final prospectus filed with the SEC pursuant to Rule 424(b) promulgated
under the Securities Act of 1933 (the "Securities Act") (the "Final
Prospectus") contained therein (as amended or supplemented, if applicable) or
any other document contained therein, or based on any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or any violation by
Assignee or its general partner of the Securities Act or the Securities
Exchange Act of 1934 (the "Exchange Act") or any rule or regulations
promulgated thereunder applicable to Assignee or its general partner including
any of the foregoing incurred in settlement of any litigation, commenced or
threatened; provided, however, that there shall be no indemnification
obligation of Assignee hereunder to the extent that any such losses, claims,
damages and liabilities (or any related expenses) of Assignor arise out of or
are based upon any materially false or untrue statement or omission which has
been omitted from or made in the Final Prospectus or any other document
contained therein in reliance upon and in conformity with the information
relating to Assignor and/or the Partnership furnished in writing to Assignee by
Assignor (collectively, the "Indemnified Matters"), and Assignee shall
reimburse Assignor for any legal and other expenses reasonably incurred in
connection with investigating, preparing or defending any such claim, loss,
damage, liability or action. Assignor shall give notice to Assignee promptly
after Assignor has actual knowledge of any claim as to which indemnity under
this Section 11 may be sought, and shall permit Assignee to assume the defense
of any such claim or any litigation resulting therefrom, provided that Assignor
may participate in such defense at its expense, and provided further that
Assignee shall not assume the defense for matters as to which there is a
conflict of interest or separate and different defenses. Assignee, in the
defense of any such claim or litigation, shall not, except with the consent of
Assignor, consent to entry of any judgment or enter into any settlement which
does not include as an unconditional term thereof the giving by the claimant or
plaintiff to Assignor a release from all liability in respect to such claim or
litigation."
-3-
39
8. MISCELLANEOUS.
(a) This Amendement, including the Exhibits attached hereto, shall
be deemed to contain all of the terms and conditions agreed upon with
respect to the subject matter hereof, it being understood that there are
not outside representations or oral agreements.
(b) This Amendment shall be binding upon and inure to the benefit
of the parties hereto and their respective successors, permitted assigns,
heirs and personal representatives.
(c) This Amendment shall be governed by and construed in accordance
with the laws of the State of Ohio.
(d) This Amendment will survive the Closing and the delivery of the
documents contemplated herein.
(e) Except as expressly modified by this Amendment, the Original
Agreement shall remain in full force and effect and unmodified hereby.
IN WITNESS WHEREOF, the parties hereto have signed three counterparts
of this Agreement, each of which shall be deemed to be an original document, as
of the date set forth above.
ASSIGNOR:
By:
---------------------------
ASSIGNEE:
XXXXXX HOTEL PROPERTIES, L.P.
By: Xxxxxx Lodging Trust, Inc.,
General Partner
By:
---------------------------
Xxxxxx X. Xxxxxx, President
-4-
40
The following form of Assignment and Assumption of Partnership Interest
Agreement is Applicable to:
Execution Date
--------------
1. Xxxx X. X'Xxxx June 18, 1996
2. Xxxxxxx X. Xxxxxxxx June 18, 1996
41
ASSIGNMENT AND ASSUMPTION OF
----------------------------
PARTNERSHIP INTEREST AGREEMENT
------------------------------
THIS ASSIGNMENT AND ASSUMPTION OF PARTNERSHIP INTEREST AGREEMENT (this
"Agreement"), made as of the ____ day of June, 1996, by and between _______
"Assignor"), and XXXXXX HOTEL PROPERTIES, L.P., an Ohio limited partnership
("Assignee"),
W I T N E S S E T H :
---------------------
WHEREAS, Assignor owns general partnership interests in Xxxxxx Amherst
Joint Venture and Xxxxxx Columbus Joint Venture as each is identified in
Exhibit A of the Offer to Exchange Limited Partnership Interests in Xxxxxx
Hotel Properties, L.P. for Interests In Certain Other Partnerships ("Exchange
Offer") (collectively the "Participation Interests");
WHEREAS, Assignee desires to acquire from Assignor and Assignor desires to
assign the Participation Interests to Assignee, on the terms and subject to the
conditions hereinafter stated; and
NOW, THEREFORE, for good and valuable consideration received to the full
satisfaction of each of them, the parties agree as follows:
A. TRANSFER OF PARTICIPATION INTERESTS. Upon the terms and subject to the
conditions set forth herein, Assignor agrees to convey, transfer, assign and
deliver to Assignee at the Closing, and Assignee agrees to accept an assignment
from Assignor at the Closing, all of Assignor's right, title, estate and
interest in and to the Participation Interests, free and clear of all liens,
security interests and encumbrances whatsoever.
B. CONSIDERATION FOR PARTICIPATION INTERESTS. The consideration to be paid
by Assignee for the Participation Interests shall be limited partnership
interests in the Assignee (the "Units") identified on Exhibit A of the Exchange
Offer. The consideration for the Participation Interests shall be payable at
B-1
42
Closing, which payment is conditional upon the completion of the offering to the
public of common shares ("Shares") of stock (the "IPO") by the general partner
of the Assignee and the closing conditions set forth in Section F of this
Agreement.
In the event of the completion of the IPO as described above, the Assignee
shall be obligated, subject to the closing conditions set forth in Section F of
this Agreement, to acquire the Participation Interests.
At the sole election of the Assignee, Assignee upon written notice to
Assignor, may elect to deposit (the "Deposit") a sum equal to the lesser of:
(a) five percent (5%) of the value of the Units to be paid to Assignor or (b)
$25,000. The amount of the Deposit (together with any interest earned thereon)
shall apply as a credit towards the Purchase Price (see Exhibit A of the
Exchange Offer). The Deposit, if paid, shall be payable to Assignor by
certified or bank check. In the event the Closing does not occur as provided in
Section G, the Assignor shall be obligated to return said Deposit, together
with any interest earned thereon, to Assignee by certified or bank check within
ten days of such request by Assignee.
C. CONFIDENTIAL OFFERING MEMORANDUM. Assignee has delivered the Exchange
Offer, together with copies of the most recent drafts of the Registration
Statement to be filed with the Securities and Exchange Commission with respect
to the IPO (the "Registration Statement") and Partnership Agreement of Assignee
to Assignor, offering to acquire the Participation Interests in exchange for
Units.
D. ASSIGNOR'S REPRESENTATIONS AND WARRANTIES. Assignor hereby represents
and warrants to Assignee as of the date hereof that:
(1) Assignor is the owner of the Partnership Interests as identified
on Exhibit A of the Exchange Offer.
(2) Assignor has all necessary power and authority to enter into this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby, without the consent or authorization of,
or notice to, any third party, except those third parties to whom such
consents or authorizations have been or will be obtained, or to whom
notices have been or will be given, prior to the Closing. This Agreement
constitutes, and the other documents and instruments to be delivered by
Assignor pursuant hereto when delivered will constitute, the
B-2
43
legal, valid and binding obligations of Assignor, enforceable against
Assignor in accordance with their respective terms.
(3) To the best of Assignor's knowledge, there is no litigation,
proceeding or action pending or threatened against or relating to Assignor
which might materially and adversely affect Assignor or which questions the
validity of this Agreement or any action taken or to be taken by Assignor
pursuant hereto.
(4) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a default
under any term or provision of any agreement, instrument or lease to which
Assignor is a party.
(5) Neither Assignor, nor, to the best of Assignor's knowledge any
prior owner of the hotels owned by the Columbus Hotel Joint Venture
(Columbus Marriott) or the Buffalo Hotel Joint Venture (Buffalo Mariott)
(hereafter the Columbus Mariott and the Buffalo Mariott collectively the
"Xxxxxx Marriott Hotels") has: (a) caused or permitted the generation,
manufacture, refinement, transportation, treatment, storage, handling,
installation, removal, disposal, transfer, production or processing of
Hazardous Substances (as hereinafter defined) or other dangerous or toxic
substances, or solid wastes, except in strict compliance with all laws:
(b) caused or permitted or received any written notice or have any actual
knowledge of the Release (as hereinafter defined) or existence of any
Hazardous Substances on or about the Xxxxxx Marriott Hotels or property
surrounding the Xxxxxx Marriott Hotels which might affect the Xxxxxx
Marriott Hotels; (c) caused or permitted or received any written notice or
have any actual knowledge of any substances or conditions on or about the
Xxxxxx Marriott Hotels or on property surrounding the Xxxxxx Marriott
Hotels which may support a claim or cause of action, whether by any
governmental authority or any other person, under any laws ("Environmental
Laws") in effect as of the date of this Agreement and all rules and
regulations promulgated thereunder, including, but not limited to: the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, 42 U.S.C. Sections 9601 et seq. (the "Superfund Act"); the
Resource Conservation and Recovery Act of 1976,
B-3
44
42 U.S.C. Sections 6921 et seq.; the Toxic Substances Control Act, 15
U.S.C. Section 2601 et seq.; the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. Section 136; the Federal Water Pollution Control
Act, 33 U.S.C. Sections 1251 et seq.; the Hazardous Materials
Transportation Act, 49 U.S.C. Sections 1801 et seq.; the Federal Solid
Waste Disposal Act, 42 U.S.C. Sections 6901 et seq.; the Clean Air Act, 42
U.S.C. Section 7401 et seq.; or any other Law. For the purposes of this
Agreement the terms "Hazardous Substances" and "Release" shall have the
definitions used in the Superfund Act; provided, however, that the
definition of the term "Hazardous Substances" shall also include (if not
included within definition contained in the Superfund Act), petroleum and
related by products, hydrocarbons, radon, asbestos, urea formaldehyde and
polychlorinated biphenyl compounds ("PCB's").
(6) At Closing, Assignor will own good, valid and marketable title to the
Participation Interests, free and clear of all mortgages, pledges, liens,
security interests, encumbrances and restrictions of any nature
whatsoever.
Assignor also makes the further representation that nothing in this
Agreement shall operate to release Assignor from any liabilities or obligations
for which Assignor would otherwise be responsible arising out of or in
connection with the ownership of the Participation Interests or the Xxxxxx
Marriott Hotels relating to any periods prior to the Closing.
All of the representations and warranties set forth in this Section D shall
be deemed renewed by Assignor on the Closing Date as if made at such time.
E. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents and
warrants to Assignor that:
(1) Assignee is, and will be at the Closing, a limited partnership duly
organized, validly existing and in good standing under the laws of the
State of Ohio and is, or at Closing will be, registered as a foreign
limited partnership in each jurisdiction in which it is engaging in
business or expects to do so. Assignee has, and at the Closing will have,
the power and authority to carry on the business for which it has been
organized. The persons executing this Agreement on behalf of Assignee are
duly authorized to do so, and all requisite action has been taken by
B-4
45
Assignee to authorize the execution and delivery of this Agreement, the
performance by Assignee of its obligations hereunder and the consummation
of the transactions contemplated hereby.
(2) To the best of Assignee's knowledge, there is no litigation,
proceeding or action pending or threatened against or related to Assignee
which might materially and adversely affect Assignee or which questions the
validity of this Agreement or any action taken or to be taken by Assignor
pursuant hereto.
(3) Assignee has all necessary power and authority to enter into this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby, without the consent or authorization of,
or notice to, any third party, except those third parties to whom such
consents or authorizations have been or will be obtained, or to whom
notices have been or will be given, prior to the Closing. This Agreement
constitutes, and the other documents and instruments to be delivered by
Assignee pursuant hereto when delivered will constitute, the legal, valid
and binding obligations of Assignee, enforceable against Assignee in
accordance with their respective terms.
(4) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a default
under any term or provision of any agreement, instrument or lease to which
Assignee is a party.
All of the representations and warranties set forth in this Section E shall
be deemed renewed by Assignee on the Closing Date as if made at such time and
shall survive the closing of the transactions contemplated hereby for a period
of six months.
F. DELIVERIES; CONDITIONS. Assignee shall issue or deliver the following to
or for the benefit of Assignor on or prior to the Closing Date:
(1) the consideration for the Participation Interests;
(2) duly executed resolutions adopted by Assignee authorizing the
execution and delivery of this Agreement by Assignee, the performance by
Assignee of its obligations hereunder and the consummation of the
transactions contemplated hereby;
B-5
46
(3) the releases required pursuant to Section I hereof;
G. CLOSING DATE. Unless the parties otherwise agree in writing, the
transactions contemplated hereby shall be closed (the "Closing") simultaneously
with the completion of the IPO, provided such offering occurs on or before
December 31, 1996 (the "Closing Date"). If the Closing has not occurred by on
or before December 31, 1996, either party, provided such party is not in
default under this Agreement, shall have the right to terminate this Agreement
by giving notice to the other party, in which event all documents and
instruments which may have been delivered by one party to the other party shall
be returned, and neither party hereto shall thereafter be under any further
liability to the other party hereto.
H. CERTAIN EXPENSES AND CHARGES. Assignee shall be charged the following
amounts at Closing: the Purchase Price, and all other costs and expenses
necessary to effect the purchase of the Participation Interests.
I. RELEASES; INDEMNIFICATION.
(1) Assignee shall use reasonable efforts (at no more than a nominal
cost to Assignee) to attempt to obtain releases of Assignor from any
lenders of the Partnerships in respect to any and all personal liability of
Assignor to such lenders accruing from and after the Closing Date (in form
and substance acceptable to Assignor in his reasonable discretion) and to
the extent such releases are not obtained, hereby agrees to assume and
indemnify Assignor, from any and all personal liability to any lenders of
the Partnerships that accrues from and after the Closing Date.
(2) Assignee shall fully indemnify and hold Assignor and Assignor's
trustee, heirs, representatives, successors and assigns harmless from and
against any and all claims, demands, losses, liabilities, damages and
expenses (including reasonable attorneys' fees) arising out of or in
connection with (i) the failure of Assignee to perform in any material
respect any of its obligations hereunder, (ii) the inaccuracy of any
representation or warranty made by Assignee hereunder (except to the extent
that such indemnification obligation would arise directly as a result of
the inaccuracy of any representation, warranty or covenant made by Assignor
hereunder), and (iii) the activity of the Partnerships and/or the operation
of the Xxxxxx Marriott Hotels from and after the Closing.
B-6
47
(3) Assignor shall fully indemnify Assignee and hold Assignee, its
officers, directors and partners and their respective representatives,
successors and assigns harmless from and against any and all claims,
demands, losses, liabilities, damages and expenses (including reasonable
attorneys' fees) arising out of or in connection with (i) the failure of
Assignor to perform in any material respect any of its obligations
hereunder, (ii) the inaccuracy of any representation or warranty made by
Assignor hereunder (except to the extent that such indemnification
obligation would arise directly as a result of the inaccuracy of any
representation, warranty or covenant made by Assignee hereunder) or (iii)
the activity of the Partnerships and the operation of the Xxxxxx Marriott
Hotels prior to the Closing.
J. CONSENTS. Assignee has entered into or will enter into an agreement to
purchase other Participation Interests in the Partnerships and Assignor hereby
consents to each and every transaction contemplated by this Agreement. Assignor
hereby consents to (i) the transfer by any partner of their interests in the
entities covered by this Agreement to Assignee or Assignee's nominee, (ii) the
transfer by any entity listed on Exhibit A of the Exchange Offer in connection
with the transactions contemplated by this Agreement, of all or substantially
all the assets of such entity, including, without limitation, the liquor
licenses and Franchise Agreements, to Assignee or Assignee's nominee and (iii)
a waiver of any rights of first refusal, options or other rights which could be
asserted by Assignor in connection with any agreements regarding the transfer
of the Participation Interests to Assignee or related to the ownership or
operation of the properties. Assignor also consents, as the case may be, to the
substitution of Assignee as a partner in the partnerships covered by the
Participation Interests. Assignor agrees to execute any documents and
instruments, and shall take or cause to be taken such further action, as may be
necessary at any time or from time to time in order to effectuate Assignor's
consent referenced herein.
In the event the Closing does not occur as provided in Section G, the
various consents referenced above shall be automatically deemed revoked by
Assignor and Assignor and Assignee agree to execute any documents and
instruments necessary in order to effect said revocation and to place Assignor
in the same position as if this Agreement had not been executed by Assignor.
B-7
48
K. ASSIGNMENT. Assignee has the right, upon five (5) days' written notice
to Assignor, to assign and transfer its interest in this Agreement to an entity
that is taxable as a partnership and that is controlled by Assignee or its
affiliates. In such event, provided that any such transferee agrees in
writing to assume all of Assignee's obligations hereunder, Assignee shall be
released from any and all liability hereunder as of the effective date of such
assignment.
L. ASSIGNMENT AND ASSUMPTION OF PARTICIPATION INTERESTS. Subject to the
terms and conditions herein as of the Closing Date:
(1) Assignor does hereby sell, convey and assign to Assignee the
interests identified on Exhibit A to the Exchange Offer (the "Participation
Interests"), and in and to the partnership agreements forming the
Partnerships, as each may have been amended from time to time.
(2) Assignee hereby agrees to assume, discharge and release Assignor
as a general partner of the Partnerships to the extent of the interest
hereby assigned from, and agrees to indemnify Assignor against, all
obligations which may accrue from and after the Closing Date by virtue of
the Partnerships or the partnership agreements applicable to the
Participation Interests hereby assigned and does further agree to be bound
by all the terms, conditions and provisions of the partnership agreements
and to be a partner of the Partnerships.
M. MISCELLANEOUS.
(1) This Agreement, together with the Exchange Offer together with the
exhibits thereto shall be deemed to contain all of the terms and conditions
agreed upon with respect to the subject matter hereof, it being understood
that there are no outside representations or oral agreements.
(2) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, permitted assigns,
heirs and personal representatives.
(3) The parties shall execute and deliver such further documents and
instruments of conveyance, sale, assignment, transfer or otherwise, and
shall take or cause to be taken such other or further action as either
party shall reasonably request at any time or from time to time in order to
effectuate the terms and provisions of this Agreement.
B-8
49
(4) This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio.
(5) This Agreement will survive the Closing and the delivery of the
documents contemplated herein.
(6) In the event of a default by either party to this Agreement, the
non-defaulting party shall have all rights available at law or in equity.
In the event the non-defaulting party prevails in any litigation related
to this Agreement, the defaulting party shall be obligated to reimburse the
non-defaulting party of all its reasonable costs and expenses related to
such litigation (including reasonable attorneys' fees).
IN WITNESS WHEREOF, the parties hereto have signed three counterparts of
this Agreement, each of which shall be deemed to be an original document, as of
the date set forth above.
ASSIGNOR:
-----------------------------
(signature)
-----------------------------
(printed name)
ASSIGNEE:
XXXXXX HOTEL PROPERTIES, L.P. an Ohio limited partnership
By: Xxxxxx Lodging Trust, Inc., its general partner
/s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx,
President
B-9
50
Exchange Offer
EXHIBIT A
Confidential Offering Memorandum
PARTICIPATING PARTNER
Offeree:
1) Xxxxxxx X. Xxxxxxxx ("Xxxxxxxx")
2) Xxxx X. X'Xxxx ("O'Neil")
--------------------------------------------------
Participation Interests to be Exchanged:
----------------------------------------
X. Xxxxxxxx:
a) 4.143% general partnership interests in Xxxxxx Columbus Joint Venture
("BCJV")(1), including the amount owned by BCJV (if any) at Closing
pursuant to an advance made by Xxxxxxxx on or about November 2, 1991
in the original principal amount of approximately $6,250 (the "Partner
Loan")
b) 4.286% general partnership interest in Xxxxxx Amherst Joint Venture
("BAJV")(2)
II. O'Neil:
a) .552% general partnership interest in BCJV(1), including the amount
owed by BCJV (if any) at Closing pursuant to an advance made by
O'Neil's predecessor in interest on or about November 2, 1991 in the
original principal amount of approximately $833 (the "Partner Loan")
b) .571% general partnership interest in BAJV(2)
Operating Partnership Interests to be Received:
-----------------------------------------------
X. XXXXXXXX. The number of Operating Partnership Interests to be received by
Xxxxxxxx shall equal ($213,000) Two Hundred Thirteen Thousand Dollars
divided by the Offering Price of the REIT Shares in the REIT Offering.
II. O'NEIL. The number of Operating Partnership Interests to be received by
O'Neil shall equal ($28,000) Twenty Eight Thousand Dollars divided by the
Offering Price of the REIT Shares in the REIT Offering.
--------------------
(1) Joint owner of Columbus Hotel Joint Venture which owns the Columbus
Marriott.
(2) Joint owner of Buffalo Hotel Joint Venture which owns the Buffalo Marriott.
A-1
51
The following (i) Assignment and Assumption Agreement is applicable to:
Execution Date
--------------
1. Xxxxxxx Xxxx June 12, 1996
2. Xxxxxx Xxxxxxxxx June 12, 1996
52
ASSIGNMENT AND ASSUMPTION
-------------------------
AGREEMENT
---------
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement"), made as of
the 12th day of June, 1996, by and between XXXXXXX XXXX ("Assignor"), and XXXXXX
HOTEL PROPERTIES, L.P., an Ohio limited partnership ("Assignee"),
W I T N E S S E T H :
WHEREAS, Assignor owns interests in Xxxxx & Xxx, L.L.C., a Georgia
limited liability company;
WHEREAS, Assignor agrees prior to the time of the Closing (as
hereinafter defined) to take all action necessary to liquidate Xxxxx & Xxx,
L.L.C. whereby Assignor will acquire a _____% interest in BBG, I, L.L.C.,
a Georgia limited liability company ("BBG") (the "Membership Interests");
WHEREAS, the assets of BBG include two hotel properties located in
Cornelius, North Carolina (the "Lake Xxxxxx Hotels");
WHEREAS, pursuant to the Offer to Exchange Limited Partnership
Interests in Xxxxxx Hotel Properties, L.P. for Interests in BBG ("Exchange
Offer") dated May 15, 1996, Assignee desires to acquire from Assignor, and
Assignor desires to assign the Membership Interests to Assignee, on the terms
and subject to the conditions hereinafter stated; and
NOW, THEREFORE, for good and valuable consideration received to the
full satisfaction of each of them, the parties agree as follows:
A. TRANSFER OF INTERESTS. Upon the terms and subject to the conditions
set forth herein, Assignor agrees to convey, transfer, assign and deliver to
Assignee at the Closing, and Assignee agrees to accept an assignment from
Assignor at the Closing, of all of Assignor's right, title, estate and interest
in and to the Membership Interests, free and clear of all liens, security
interests and encumbrances whatsoever.
B. CONSIDERATION FOR MEMBERSHIP INTERESTS. The consideration to be paid
by Assignee for the Membership Interests shall be a limited partnership interest
in the Assignee (the "Units") identified on Exhibit A of the Exchange Offer. The
payment of consideration for the Membership Interests shall be payable at
Closing, which payment is conditional upon the completion of the offering to the
public of common shares ("Shares") of
53
stock (the "IPO") by the general partner of the Assignee and the closing
conditions set forth in Section F of this Agreement.
In the event of the completion of the IPO as described above, the
Assignee shall be obligated, subject to the closing conditions set forth in
Section F of this Agreement, to acquire the Membership Interests.
The Units represented by the Exchange Offer shall be the same in form,
terms, conditions and registration rights as Units received by Xxxxxxx X.
Xxxxxx, Xxxxxx X. Xxxxxx, Xxxx X. Xxxxxx and any member of their respective
immediate families or any trusts for their or their families' benefit, except
that the exchange rights permitting Assignor to convert the Units into Shares
shall be available to Assignor at any time after the Closing pursuant to Section
7.4(a) of the Partnership Agreement, which is referred to in the Exchange Offer.
C. CONFIDENTIAL OFFERING MEMORANDUM. Assignee has delivered the
Exchange Offer, together with copies of the most recent drafts of the
Registration Statement to be filed with the Securities and Exchange Commission
with respect to the IPO (the "Registration Statement") and Partnership Agreement
of Assignee to Assignor, offering to acquire the Membership Interests in
exchange for Units.
D. ASSIGNOR'S REPRESENTATIONS AND WARRANTIES. Assignor hereby
represents and warrants to Assignee as of the date hereof that:
(1) After the liquidation of Xxxxx & Xxx, L.L.C. and prior to
the Closing Date, Assignor will be the owner of Membership Interests in
BBG representing 29.7% ownership of BBG.
(2) Assignor has all necessary power and authority to enter
into this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby, without the consent or
authorization of, or notice to, any third party, except those third
parties to whom such consents or authorizations have been or will be
obtained, or to whom notices have been or will be given, prior to the
Closing. This Agreement constitutes, and the other documents and
instruments to be delivered by Assignor pursuant hereto when delivered
will constitute, the legal, valid and binding obligations of Assignor,
enforceable against Assignor in accordance with their respective terms.
(3) To the best of Assignor's knowledge, there is no
litigation, proceeding or action pending or threatened against or
relating to Assignor which might materially and adversely affect
2
54
Assignor or which questions the validity of this Agreement or any
action taken or to be taken by Assignor pursuant hereto.
(4) Neither the execution of this Agreement nor the
consummation of the transactions contemplated hereby will, in any
material respect, constitute a violation of or be in conflict with or
constitute a default under any term or provision of any agreement,
instrument or lease to which Assignor is a party.
(5) Neither Assignor, nor, to the best of Assignor's knowledge
any prior owner of the Lake Xxxxxx Hotels has: (a) caused or permitted
the generation, manufacture, refinement, transportation, treatment,
storage, handling, installation, removal, disposal, transfer,
production or processing of Hazardous Substances (as hereinafter
defined) or other dangerous or toxic substances, or solid wastes,
except in strict compliance with all laws: (b) caused or permitted or
received any written notice or have any actual knowledge of the Release
(as hereinafter defined) or existence of any Hazardous Substances on or
about the Lake Xxxxxx Hotel or property surrounding the Lake Xxxxxx
Hotels which might affect the Lake Xxxxxx Hotels; (c) caused or
permitted or received any written notice or have any actual knowledge
of any substances or conditions on or about the Lake Xxxxxx Hotels or
on property surrounding the Lake Xxxxxx Hotels which may support a
claim or cause of action, whether by any governmental authority or any
other person, under any laws ("Environmental Laws") in effect as of the
date of this Agreement and all rules and regulations promulgated
thereunder, including, but not limited to: the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42
U.S.C. Sections 9601 et seq. (the "Superfund Act"); the Resource
Conservation and Recovery Act of 1976, 42 U.S.C. Sections 6921 et seq.;
the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the
Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. Section
136; the Federal Water Pollution Control Act, 33 U.S.C. Sections 1251
et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. Sections
1801 et seq.; the Federal Solid Waste Disposal Act, 42 U.S.C. Sections
6901 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; or any
other Law. For the purposes of this Agreement the terms "Hazardous
Substances" and "Release" shall have the definitions used in the
Superfund Act; provided, however, that the definition of the term
"Hazardous Substances"
3
55
shall also include (if not included within definition contained in the
Superfund Act), petroleum and related by products, hydrocarbons, radon,
asbestos, urea formaldehyde and polychlorinated biphenyl compounds
("PCB's").
(6) At Closing, Assignor will own good, valid and marketable
title to the Membership Interests, free and clear of all mortgages,
pledges, liens, security interests, encumbrances and restrictions of
any nature whatsoever.
Assignor also makes the further representation that nothing in this
Agreement shall operate to release Assignor from any liabilities or obligations
for which he would otherwise be responsible arising out of or in connection with
the ownership of the Membership Interests or the Lake Xxxxxx Hotels held by BBG
relating to any periods prior to the Closing.
All of the representations and warranties set forth in this Section D
shall be deemed renewed by Assignor on the Closing Date as if made at such time.
E. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents and
warrants to Assignor that:
(1) Assignee is, and will be at the Closing, a limited
partnership duly organized, validly existing and in good standing under
the laws of the State of Ohio and is, or at Closing will be, registered
as a foreign limited partnership in each jurisdiction in which it is
engaging in business or expects to do so. Assignee has, and at the
Closing will have, the power and authority to carry on the business for
which it has been organized. The persons executing this Agreement on
behalf of Assignee are duly authorized to do so, and all requisite
action has been taken by Assignee to authorize the execution and
delivery of this Agreement, the performance by Assignee of its
obligations hereunder and the consummation of the transactions
contemplated hereby.
(2) To the best of Assignee's knowledge, there is no
litigation, proceeding or action pending or threatened against or
related to Assignee which might materially and adversely affect
Assignee or which questions the validity of this Agreement or any
action taken or to be taken by Assignee pursuant hereto.
4
56
(3) Assignee has all necessary power and authority to enter
into this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby, without the consent or
authorization of, or notice to, any third party, except those third
parties to whom such consents or authorizations have been or will be
obtained, or to whom notices have been or will be given, prior to the
Closing. This Agreement constitutes, and the other documents and
instruments to be delivered by Assignee pursuant hereto when delivered
will constitute, the legal, valid and binding obligations of Assignee,
enforceable against Assignee in accordance with their respective terms.
(4) Neither the execution of this Agreement nor the
consummation of the transactions contemplated hereby will, in any
material respect, constitute a violation of or be in conflict with or
constitute a default under any term or provision of any agreement,
instrument or lease to which Assignee is a party.
All of the representations and warranties set forth in this Section E
shall be deemed renewed by Assignee on the Closing Date as if made at such time
and shall survive the closing of the transactions contemplated hereby for a
period of six months.
F. DELIVERIES; CONDITIONS. Assignee shall issue or deliver the
following to or for the benefit of Assignor on or prior to the Closing Date:
(1) the consideration for the Membership Interests;
(2) duly executed resolutions adopted by Assignee authorizing
the execution and delivery of this Agreement by Assignee, the
performance by Assignee of its obligations hereunder and the
consummation of the transactions contemplated hereby;
(3) the releases required pursuant to Section I hereof;
G. CLOSING DATE. Unless the parties otherwise agree in writing, the
transactions contemplated hereby shall be closed (the "Closing") simultaneously
with the completion of the IPO, provided such offering occurs on or before
December 31, 1996 (the "Closing Date"). If the Closing has not occurred by the
Closing Date, this Agreement shall terminate, in which event all documents and
instruments which may have been delivered by one party to the other party shall
be returned, and neither party hereto shall thereafter be under any further
liability to the other party hereto.
5
57
H. CERTAIN EXPENSES AND CHARGES. Assignee shall be charged the
following amounts at Closing: the Purchase Price, one-half of Assignor's
attorney fees in connection with this Agreement (which sum shall not exceed
$3,750) and all other costs and expenses necessary to effect the purchase of the
Membership Interests. Assignee also agrees at Closing to prepare statement of
working capital for BBG, including current assets such as cash, accounts
receivable, inventory and deposits; and current liabilities such as accounts
payable and accrued expenses and approved capital expenditures not expended. To
the extent that a statement reflects a positive amount of working capital, a pro
rata cash distribution to Assignor shall be made by the BBG. To the extent that
a statement reflects a deficit in working capital, the Assignor shall be
required to make a pro rata cash contribution to BBG. In the event of a
disagreement between Assignor and Assignee regarding the statement of working
capital, Assignor may, upon ten (10) days notice to Assignee, conduct an audit
of the relevant financial records of BBG. In the event such audit discloses a
sum of five percent (5%) or more in excess of the original amount is owed to
Assignor, Assignee shall either pay such sum or submit the dispute to binding
mediation in Cleveland, Ohio. In the event such audit discloses a difference of
less than five percent (5%) in excess of the original amount, Assignee shall pay
such sum to Assignor unless Assignee, in good faith, disputes the audit findings
in which event the dispute shall be submitted to binding mediation in Cleveland,
Ohio.
Finally, Assignee and Assignor shall cause BBG to also pay to Assignor
at the Closing any unpaid asset management fees or other amounts due and owing
to Assignor or its affiliates.
I. RELEASES; INDEMNIFICATION.
(1) Assignee shall use reasonable efforts (at no more than a
nominal cost to Assignee) to attempt to obtain releases of Assignor
from any lenders of BBG in respect to any and all personal liability of
Assignor to such lenders accruing from and after the Closing Date (in
form and substance acceptable to Assignor in his reasonable discretion)
and to the extent such releases are not obtained, hereby agrees to
assume and indemnify Assignor, from any and all personal liability to
any lenders of BBG that accrues from and after the Closing Date.
Assignee also agrees to pay off the outstanding mortgage debt on the
Lake Xxxxxx Hotels within thirty (30) days after the Closing.
(2) Assignee shall fully indemnify and hold Assignor and
Assignor's trustee, heirs, representatives, successors and assigns
harmless from and against any and all claims, demands, losses,
6
58
liabilities, damages and expenses (including reasonable attorneys'
fees) arising out of or in connection with (i) the failure of Assignee
to perform in any material respect any of its obligations hereunder,
(ii) the inaccuracy of any representation or warranty made by Assignee
hereunder (except to the extent that such indemnification obligation
would arise directly as a result of the inaccuracy of any
representation, warranty or covenant made by Assignor hereunder), and
(iii) the activity of BBG and/or the operation of the properties (Lake
Xxxxxx Hotels) from and after the Closing.
(3) Assignor shall fully indemnify Assignee and hold Assignee,
its officers, directors and partners and their respective
representatives, successors and assigns harmless from and against any
and all claims, demands, losses, liabilities, damages and expenses
(including reasonable attorneys' fees) arising out of or in connection
with (i) the failure of Assignor to perform in any material respect any
of its obligations hereunder, (ii) the inaccuracy of any representation
or warranty made by Assignor hereunder (except to the extent that such
indemnification obligation would arise directly as a result of the
inaccuracy of any representation, warranty or covenant made by Assignee
hereunder) or (iii) the activity of BBG and the operation of the
properties (Lake Xxxxxx Hotels) prior to the Closing.
J. CONSENTS. Assignee has entered into or will enter into an agreement
to purchase other Membership Interests in BBG and Assignor hereby consents to
each and every transaction contemplated by this Agreement. Assignor hereby
consents to (i) the transfer by any member of BBG of such member's Membership
Interest to Assignee or Assignee's nominee, (ii) the transfer by BBG in
connection with the transactions contemplated by this Agreement, of all or
substantially all the assets of BBG, including, without limitation, the liquor
licenses and Franchise Agreements, to Assignee or Assignee's nominee and (iii) a
waiver of any rights of first refusal, options or other rights which could be
asserted by Assignor in connection with any agreements regarding the transfer of
the Membership Interests to Assignee or related to the ownership or operation of
the properties. Assignor also consents to the substitution of Assignee as a
member in BBG or the liquidation or termination of BBG upon completion of the
transfer referenced above. Assignor agrees to execute any documents and
instruments, and shall take or cause to be taken such further action, as may be
necessary at any time or from time to time in order to effectuate Assignor's
consent referenced herein.
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59
In the event the Closing does not occur as provided in Section G, the
various consents referenced above shall be automatically deemed revoked by
Assignor and Assignor and Assignee agree to execute any documents and
instruments necessary in order to effect said revocation and to place Assignor
in the same position as if this Agreement had not been executed by Assignor.
K. ASSIGNMENT. Assignee has the right, upon five (5) days' written
notice to Assignor, to assign and transfer its interest in this Agreement to an
entity that is taxable as a partnership and that is controlled by Assignee or
the Xxxxxx Family. In such event, provided that any such transferee agrees in
writing to assume all of Assignee's obligations hereunder, Assignee shall be
released from any and all liability hereunder as of the effective date of such
assignment.
L. ASSIGNMENT AND ASSUMPTION OF MEMBERSHIP INTERESTS. Subject to the
terms and conditions herein:
(1) Assignor does hereby sell, convey and assign to Assignee a
29.7% Membership Interest in BBG, a Georgia limited liability company,
and in and to the Operating Agreement and Article of Organization
forming BBG dated as of February 2, 1996, as may have been amended from
time to time.
(2) Assignee hereby agrees to assume, discharge and release
Assignor as a member of BBG to the extent of the interest hereby
assigned from, and agrees to indemnify Assignor against, all
obligations which may accrue from and after the Closing Date by virtue
of BBG or the Articles of Organization or Operating Agreement
applicable to the interest hereby assigned and does further agree to be
bound by all the terms, conditions and provisions of the Articles of
Organization and Operating Agreement and to be a member of BBG, or to
cause BBG's liquidation or termination in a timely manner.
M. MISCELLANEOUS.
(1) This Agreement, together with the Exchange Offer together
with the exhibits thereto shall be deemed to contain all of the terms
and conditions agreed upon with respect to the subject matter hereof,
it being understood that there are no outside representations or oral
agreements.
8
60
(2) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors,
permitted assigns, heirs and personal representatives.
(3) The parties shall execute and deliver such further
documents and instruments of conveyance, sale, assignment, transfer or
otherwise, and shall take or cause to be taken such other or further
action as either party shall reasonably request at any time or from
time to time in order to effectuate the terms and provisions of this
Agreement.
(4) This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
(5) This Agreement will survive the Closing and the delivery
of the documents contemplated herein.
(6) In the event of a default by either party to this
Agreement, the non-defaulting party shall have all rights available at
law or in equity. In the event the non-defaulting party prevails in any
litigation related to this Agreement, the defaulting party shall be
obligated to reimburse the non-defaulting party all of its reasonable
costs and expenses related to such litigation (including reasonable
attorneys' fees).
IN WITNESS WHEREOF, the parties hereto have signed three
counterparts of this Agreement, each of which shall be deemed to be an original
document, as of the date set forth above.
ASSIGNOR:
--------------------------------
ASSIGNEE:
XXXXXX HOTEL PROPERTIES, L.P. an Ohio limited partnership
By: Xxxxxx Lodging Trust, Inc.
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Xxxxxx X. Xxxxxx,
President
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EXHIBIT A
Confidential Offering Memorandom
PARTICIPATING INVESTORS
-----------------------
1) Offeree: XXXXXX XXXXXXXXX - 24.3% interest in BBG, I, L.L.C.
2) Offeree: XXXXXXX XXXX - 29.7% interest in BBG, I, L.L.C.
===============================================================================
VALUATION FORMULA
A. The Purchase Price for the BBG Interests of the Offeree shall be
calculated in the following manner:
(1) Definitions:
(a) "Value of the REIT Shares" shall mean the total value of the
REIT Shares issued by the REIT and partnership interest
("Units") issued by the Operating Partnership at the time of
the REIT Offering computed by multiplying the number of REIT
Shares and Units to be issued times the midpoint dollar amount
specified in the preliminary prospectus (and any amendments
thereto) to be filed by the REIT with the Securities and
Exchange Commission (the "SEC"). In computing the number of
Units to be issued, any convertible debt of the Operating
Partnership shall be considered converted;
(b) "Gross Purchase Price" shall be the product of the Value of
the REIT Shares times the Lake Xxxxxx Share;
(c) The "Lake Xxxxxx Share" shall be a fraction computed by
dividing the Net Operating Income ("NOI") of the Lake Xxxxxx
Hotels (the Lake Xxxxxx Holiday Inn and the Lake Xxxxxx
Xxxxxxx Inn) by the total NOI of all hotels to be included
in the REIT offering, based upon the preliminary prospectus
(and any amendments thereto) filed with the SEC;
(d) In each case, NOI shall be computed as follows:
Start with the net income for the most recent twelve (12)
month period as disclosed in the financial statements
contained in the preliminary prospectus,
Add:
1. Depreciation and amortization;
2. Interest expense;
3. Extraordinary or Unusual losses not
affecting the pro forma net income of the
Lessee;
4. Other nonoperating expenses or losses (such
as any loss on disposal of fixes assets) not
affecting the pro forma net income of the
Lessee;
5. Pro forma adjustments made in the
preliminary prospectus, to the extent that
they increase the pro forma net income of
the Lessee or the REIT, for instance, any
adjustment increasing departmental profits,
or decreasing real estate taxes, franchise
fees expense or other item which increases
the pro forma net income of the Lessee; and
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6. The excess (if any) a management fee expense
of 2.5% of revenues over the actual
management fee expense.
Subtract:
1. Interest income;
2. Extraordinary gains or income not affecting
the pro forma net income of the Lessee;
3. Other nonoperating income or gains (such as
any gain on disposal of fixed assets) not
affecting the pro forma net income of the
Lessee;
4. Pro forma adjustments made in the
preliminary prospectus, to the extent that
they decrease the pro forma net income of
the Lessee or the REIT, for instance, real
estate taxes, franchise fees expense or
other item which decrease the pro forma net
income of the REIT or the Lessee;
5. A reserve for replacements of furniture,
fixtures and equipment equal to four percent
(4%) of the total revenues disclosed in the
preliminary prospectus; and
6. The excess (if any) of actual management fee
expense over a management fee expense of
2.5% of revenues.
(e) "Lake Xxxxxx Costs" shall mean the sum of the amounts
referenced below, as reflected in the preliminary prospectus
under the use of proceeds:
1. costs directly related to the Lake Xxxxxx
Hotels including, without limitation, the
following: third party mortgage debts,
notes payable to franchisor, transfer
costs, accounting and audit, due diligence
costs, such as title commitment and title
insurance, environmental, engineering,
renovation of the Properties, agreed upon
by the Offeree and the Operating
Partnership and, if applicable, the
Franchisor and which may include property
upgrades as required by the Franchisor
including any Property Improvement Plans
("PIP") or otherwise), appraisals,
conveyance or transfer taxes any and all
sales taxes payable in connection marketing
fees or any other costs specifically
attributable to the Properties and all
other costs incurred in connection with
the Closing of this transaction as are
customary in the local of each hotel; PLUS
2. (i) costs unallocated to a specific property
attributable to the REIT Offering excluding
underwriters fees, but including without
limitation, working capital, registration
cost, legal and accounting fees, printing
expenses, marketing and travel expenses
multiplied by the (ii) Lake Xxxxxx Share;
and PLUS
3. An allocable portion of the underwriters
fees computed by multiplying (i) 7.5269% by
(ii) the sum of the Lake Xxxxxx costs
referred to in 1 and 2 aforesaid.
(f) "Purchase Price" shall mean the Gross Purchase Price less Lake
Xxxxxx Costs, with the result multiplied by Offeree's
effective ownership of BBG.
B. The Purchase Price shall be paid on the form of Units. The number of
Units to be received shall equal the Purchase Price divided by the
midpoint of price per share disclosed in the preliminary prospectus and
any amendments thereto.
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STANDBY TO PURCHASE STOCK CONDITIONED
-------------------------------------
UPON EXERCISE OF REDEMPTION RIGHT
---------------------------------
THIS STANDBY TO PURCHASE STOCK (the "Agreement") is made and entered
into as of the 12th day of June, 1996, by and among XXXXXXX XXXX ("Xxxx") and
XXXXXX XXXXXXXXX ("Xxxxxxxxx"), individual residents of the State of Georgia
(collectively, the "Seller") and XXXXXX GROUP, INC., an Ohio corporation (the
"Purchaser").
W I T N E S S E T H:
WHEREAS, Xxxx and Xxxxxxxxx own all of the interest in Xxxxx & Xxx,
L.L.C., a Georgia limited liability company ("C&J"); and
WHEREAS, C&J and Boycorn, L.L.C., an Ohio limited liability company
and an affiliate of Purchaser are the owners of BBG, I L.L.C. ("BBG"); and
WHEREAS, BBG is the owner of certain improved real property known as the
Lake Xxxxxx Holiday Inn and the Lake Xxxxxx Xxxxxxx Inn located in Cornelius,
North Carolina; and
WHEREAS, Seller desires to dissolve C&J and then exchange its interest
in BBG (the "Exchange") pursuant to that certain Offer to Exchange Limited
Partnership Interest dated May 15, 1996, said interest for limited partnership
units (the "Units") in Xxxxxx Hotel properties, L.P., an Ohio limited
partnership (the "Partnership") whose general partner, Xxxxxx Lodging Trust,
Inc. (the "REIT"), a newly formed Ohio corporation, expects to qualify as a
"real estate investment trust" for federal income tax purposes; and
WHEREAS, the Partnership will be governed by an Agreement of Limited
Partnership of Xxxxxx Hotel Properties, L.P. (the "LP Agreement") pursuant to
which each limited partner of the Partnership shall have the right to require
the Partnership to redeem, on a specified date, all or a portion of the Units
held by such limited partner for cash in an amount specified in the LP
Agreement or for shares of the REIT (the "Shares"); and
WHEREAS, in order to induce Seller to effectuate the Exchange,
Purchaser has agreed, upon the happening of certain conditions, to purchase
Seller's Units; and
WHEREAS, in the event Seller exercises its redemption rights pursuant
to the LP Agreement on or after February 8, 1997, and in the event the
Partnership elects to pay Seller in Shares of the REIT rather than to pay
Seller in cash for the Units, which election shall be in the sole and absolute
discretion of the Partnership, Purchaser and Seller desire that Purchaser
purchase and Seller sell the Units on the terms and conditions herein set forth.
64
NOW THEREFORE, for and in consideration of the premises, the mutual
covenants, promises, agreements, representations and warranties contained in
this Agreement, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, do hereby covenant, promise, agree, represent and warrant as
follows:
The above recitals are hereby incorporated into this Agreement by
reference.
1. PURCHASE OF UNITS IN THE EVENT REIT ELECTS NOT TO PAY CASH FOR UNITS
1.1 REDEMPTION RIGHT. Pursuant to Section 7.4 of the LP
Agreement, Seller, at anytime after the closing of the initial public offering
of the Shares, shall have the right to require the Partnership to redeem all or
a portion of Seller's Units for cash in an amount specified in the LP
Agreement, or for Shares in the amount specified in the LP Agreement, which
election shall be in the sole discretion of the Partnership. Notwithstanding
this right, the Seller shall have the following rights:
(a) If on or anytime after February 8, 1997, pursuant
to Section 7.4 of the LP Agreement, Seller shall give written notice to the
Partnership that Seller wishes to exercise its redemption right (the "First
Redemption") and the Partnership indicates to Seller that it will elect the
"Share Election" as hereinafter defined rather than the "Cash Election" as
hereinafter defined, then, if Seller so elects, Purchaser shall purchase and
Seller shall sell to Purchaser Units with an aggregate value (as calculated for
redemption purposes under the LP Agreement) of up to $500,000.00. Upon notice
to the Partnership of Seller's wish to redeem, Seller shall copy Purchaser and
Purchaser shall cause the Partnership to make its indication within ten
business days of the date of notice to the Partnership.
(b) If on or anytime after July 8, 1997, pursuant to
Section 7.4 of the LP Agreement, Seller shall give written notice to the
Partnership that Seller wishes to exercise its redemption right (the "Second
Redemption") and the Partnership indicates to Seller that it will elect the
Share Election rather than the Cash Election, then, if Seller so elects,
Purchaser shall purchase and Seller shall sell to Purchaser Units with an
aggregate value (as calculated for redemption purposes under the LP Agreement)
of up to $300,000.00. Upon notice to the Partnership of Seller's wish to
redeem, Seller shall copy Purchaser and Purchaser shall cause the Partnership
to make its indication within ten business days of the date of notice to the
Partnership.
(c) If on or anytime after July 8, 1997, pursuant to
Section 7.4 of the LP Agreement, Seller shall give written notice to the
Partnership that Seller wishes to exercise its redemption right (the "Prorata
Redemption"), which notice shall not be given more than once a month or for
more than the "Prorata
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65
Amount" (as hereinafter defined) on a cumulative basis (i.e. if a redemption
is done after three months, then the Prorata Amount shall be the Prorata Amount
multiplied by three), and the Partnership indicates to Seller that it will
elect the Share Election rather than the Cash Election, then, if Seller so
elects, Purchaser shall purchase and Seller shall sell to Purchaser Units with
an aggregate value (as calculated for redemption purposes under the LP
Agreement) of up to the Prorata Amount for each redemption. Upon notice to the
Partnership of Seller's wish to redeem, Seller shall copy Purchaser and
Purchaser shall cause the Partnership to make its indication within ten
business days of the date of notice to the Partnership.
1.2. CERTAIN DEFINITIONS.
For purposes of this Agreement:
(a) the term "Share Election" shall mean the Partnership's indication
to Seller that it will elect (upon the exercise of either the First Redemption,
the Second Redemption or any Prorata Redemption) to pay to the Seller Shares,
in an amount specified in the LP Agreement, rather than to pay the Seller cash
in exchange for Seller's Units or the failure to pay cash to Seller after a
Cash Election upon Seller's exercise of either the First, Second, or Prorata
Redemption right, within 10 business days of Seller's exercise of such rights.
The term "Cash Election" shall mean the Partnership's indications to Seller
that it will elect (upon the exercise of either the First Redemption, the
Second Redemption or any Prorata Redemption) by the Partnership to pay cash to
the Seller in an amount specified in the LP Agreement and the payment thereof
within 10 business days.
(b) the term "Prorata Amount" shall mean the total value of all Units
of Seller minus the First Redemption and Second Redemption amounts divided by
twenty-four.
2. PURCHASE PRICE; TRANSFER OF SECURITIES.
2.1 PURCHASE PRICE. The full, entire and aggregate
amount that shall be paid at any Closing by the Purchaser to the Seller shall
be the number of Units sold multiplied by the per Unit consideration as
calculated under the LP Agreement up to $500,000.00 for the First Redemption,
the number of Units sold multiplied by the per Unit consideration up to
$300,000.00 for the Second redemption, and the number of Units sold multiplied
by the per Unit consideration as calculated under the LP Agreement up to the
Prorata Amount for each Prorata Redemption (the "Purchase Price"). Seller shall
allocate the Purchase Price among Xxxx and Xxxxxxxxx pursuant to a separate
agreement and Seller shall indemnify Purchaser against any claim of any nature
of any person or entity that may arise from that allocation.
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66
2.2 METHOD OF PAYMENT. The Purchase Price shall be paid in
cash at the Closing by (i) a certified check drawn upon, or cashier's check of,
a national bank approved by the Seller, or (ii) by wire delivery of funds
through the Federal Reserve Systems to an account designated by the Seller.
2.3 SALE OF UNITS; WARRANTY. The Seller shall deliver to the
Purchaser at the Closing, concurrently with the payment of the Purchase Price,
certificates representing the Seller's Units to be sold at the Closing. Seller
hereby represents and warrants that it has good title to the Units, free and
clear of any liens, claims, charges, options or other encumbrances.
3. CLOSING. The closing (the "Closing") of the purchase and sale of
the Seller's Units to be purchased and sold pursuant to this Agreement shall be
held at a place and at such time and on such date as is mutually determined by
the Purchaser and the Seller (the "Closing Date") and specified by written
notice from the Purchaser to the Seller not less than ten (10) days prior
thereto; provided, however, that the Closing Date shall be on or before twenty
(20) days after the earlier of (i) the date on which the Partnership indicates
to Seller that it will make the Share Election for the applicable redemption
right, or (ii) the date on which that indication was required to be made in
accordance with Section 1.2.
4. REPRESENTATIONS AND WARRANTIES.
4.1 REPRESENTATIONS AND WARRANTIES OF THE SELLER. The Seller
represents and warrants to the Purchaser that:
4.1.1. VALIDITY OF AGREEMENT. The Seller has the legal
capacity and authority to enter into this Agreement. This Agreement is a valid
and legally binding obligation of the Seller and is fully enforceable against
the Seller in accordance with its terms, except as such enforceability may be
limited by general principles of equity, bankruptcy, insolvency, moratorium and
similar laws relating to creditors' rights generally. The execution delivery
and performance of this Agreement by Seller does not conflict with or result in
a violation of any judgment, order or decree of any court or arbiter in any
proceeding to which Seller is a party, and does not conflict with or constitute
a material breach of, or constitute a material default under, any contract,
agreement or other instrument by which Seller is bound or to which Seller is a
party.
4.1.2. NO BROKERAGE. The Seller has not incurred any
obligation or liability, contingent or otherwise, for brokerage fees, finder's
fees, agent's commissions or the like in connection with this Agreement or the
transactions contemplated hereby.
4.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER.
The Purchaser represents and warrants to the Seller that:
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67
4.2.1. VALIDITY OF AGREEMENT. The Purchaser has the
legal capacity and authority to enter into this Agreement. This Agreement is
a valid and legally binding obligation of the Purchaser and is fully enforceable
against the Purchaser in accordance with its terms, except as such
enforceability may be limited by general principles of equity, bankruptcy,
insolvency, moratorium and similar laws relating to creditors's rights
generally. The execution delivery and performance of this Agreement by
Purchaser does not conflict with or result in a violation of any judgment,
order or decree of any court or arbiter in any proceeding to which Purchaser is
a party, and does not conflict with or constitute a material breach of, or
constitute a material default under, any contract, agreement or other instrument
by which Purchaser is bound or to which Purchaser is a party.
4.2.2. NO BROKERAGE. The Purchaser has not incurred
any obligation or liability, contingent or otherwise, for brokerage fees,
finder's fees, agent's commissions, or the like in connection with this
Agreement or the transactions contemplated hereby.
4.3. DISCLAIMER. The Purchaser acknowledges that,
except as expressly set forth herein, the Seller's Units are being conveyed to
the Purchaser without representation or warranty of any kind.
4.4 VALUE OF UNITS. The LP Agreement operates in a
manner that makes one Unit equivalent in value to one common share in the REIT.
5. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The
Purchaser further represents and warrants to the Seller that:
5.1 ACCREDITED INVESTOR. Purchaser is an "accredited
investor" as that term is defined in Rule 501(a) of Regulation D of the
Securities Act of 1933 (the "Act"), and has substantial experience in
evaluating and investing in private placement transactions so that Purchaser is
capable of evaluating the merits and risks associated with the purchase of the
Units. Furthermore, Purchaser has evaluated such merits and risks, and, on the
basis of such evaluation desires to enter into the transactions contemplated
hereby. Purchaser, by reason of its business or financial experience or the
business or financial experience of its professional advisors, has the capacity
to protect its own interest in connection with purchase of the Units hereunder.
Purchaser acknowledges that it has been given access to all information of the
Partnership which Purchaser considers necessary or appropriate, and Purchaser
has fully considered and used this information to evaluate the merits and the
risks of this purchase.
5.2. INVESTMENT INTENT. The Purchaser is acquiring the
Seller's Units for investment only, for the Purchaser's own account, and not
with a view to, or for offer for sale or for sale
5
68
in connection with, the distribution or transfer thereof. The Seller's Units
are not being purchased for subdivision or fractionalization thereof, and the
Purchaser has no contract, undertaking, agreement or arrangement with any
Person to sell, hypothecate, pledge, donate or otherwise transfer (with or
without consideration) to any such Person any of the Seller's Units which the
Purchaser is acquiring hereunder, and the Purchaser has no present plans or
intentions to enter into any such contract, undertaking, agreement or
arrangement.
5.3 RULE 144. Purchaser acknowledges that the Units must be
held indefinitely unless subsequently registered under the Act and the
applicable state securities laws, or an exemption from such registration is
available. Purchaser is aware of the provision of Rule 144 promulgated under
the Act which permits limited resale of shares purchased in a private placement
subject to satisfaction of certain conditions, including (except as limited by
Rule 144(k)), among other things, the availability of certain public
information about the Partnership, the resale occurring not less than two years
after a party has purchased and paid for the security to be sold, the sale
being effected through a "broker transaction" or in transactions directly with
a "market maker" (as provided by Rule 144(f)), and the number of shares being
sold during any three month period not exceeding specified limitations.
Purchaser acknowledges that a legend to this effect shall be affixed to the
certificate representing the Units.
6. WAIVER OF PIGGYBACK REGISTRATION RIGHTS.
Seller and Purchaser acknowledge that, pursuant to that certain
Registration Rights Agreement (the "Registration Agreement") by and among
Xxxxxx Lodging Trust, Inc. and Seller to be executed on completion of the
REIT's initial public offering, when the REIT proposes to make certain
registrations of its securities under the Act, Seller will have certain rights
(the "Piggyback Registration Right") to have Shares included in such
registration. In the event that Seller fails to exercise its Piggyback
Registration Right, upon the receipt of notice of its right to participate in a
registration pursuant to the Registration Agreement, Purchaser shall have no
further obligation to Purchase Units from Seller so long as the underwriter
would have allowed for the sale of all of the Seller's Shares and such offering
is thereafter consummated.
7. MISCELLANEOUS.
7.1. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
All of the representations, warranties, covenants, promises and agreements of
the parties contained in this Agreement (or in any document delivered or to be
delivered pursuant to this Agreement or in connection with the Closing) shall
survive the execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby.
6
69
7.2 NOTICES. All notices, requests, demands, consents and
other communications which are required or may be given under this Agreement
(collectively, the "Notices") shall be in writing and shall be given either (i)
by personal delivery against a receipted copy, or (ii) by facsimile
transmission followed by certified or registered U. S. mail, postage prepaid,
to the following addresses:
(a) If to the Seller:
Xxxxxxx Xxxx and Xxxxxx Xxxxxxxxx
The Grand
00 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Facsimile (000) 000-0000
with a copy to:
Xxxx X. Xxxxxxxxx, Esq.
Xxxxxx Xxxxxxx Xxxxx & Xxxxxxxxxxx, L.L.P.
000 Xxxxxx Xxxxxx, Xxxxx 0000
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
(b) If to the Purchaser:
Xx. Xxxxxx X. Xxxxxx
Xxxxxx Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxx, Esq.
Xxxxx & Xxxxxxxxx
3200 National City Center
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000-0000
Facsimile: (000) 000-0000
or to other address of which written notice in accordance with this Section 7.2
shall have been provided by such party to the others. Notices may only be given
in the manner hereinabove described in this Section 7.2 and shall be deemed
received when given in such manner.
7.3 ENTIRE AGREEMENT. This Agreement constitutes the full,
entire and integrated agreement between the parties hereto with respect to the
subject matter hereof, and supersedes all prior negotiations, correspondence,
understandings and agreement among the parties hereto respecting the subject
matter hereof.
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70
7.4. ASSIGNABILITY. This Agreement shall not be assignable by any
party hereto without the prior written consent of the other party hereto.
7.5. BINDING EFFECT; BENEFIT. This Agreement shall inure to the
benefit of and be binding upon the parties hereto, and their respective heirs,
personal and legal representatives, guardians, successors and permitted
assigns. Nothing in this Agreement, express or implied, is intended to confer
upon any other person or entity any rights, remedies, obligations or
liabilities.
7.6. SEVERABILITY. Any provision of this Agreement which is held by
a court of competent jurisdiction to be prohibited or unenforceable shall be
ineffective to the extent of such prohibition or unenforceability, without
invalidating or rendering unenforceable the remaining provisions of this
Agreement.
7.7. AMENDMENT; WAIVER. No provision of this Agreement may be
amended, waived or otherwise modified without the prior written consent of all
of the parties hereto. No action taken pursuant to this Agreement, including
any investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action of compliance with any representation,
warranty, covenant or agreement herein contained. The waiver by any party
hereto of a breach of any provision or condition contained in this Agreement
shall not operate or be construed as a waiver of any subsequent breach or of
any other conditions hereof.
7.8. SECTION HEADINGS. The section and other headings contained in
this Agreement are for reference purposes only and shall not affect the meaning
or interpretation of this Agreement.
7.9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same Agreement.
7.10. APPLICABLE LAW. This Agreement is made and entered into, and
shall be governed by and construed in accordance with, the laws of the State of
Georgia.
7.11. REMEDIES. The parties hereto acknowledge that the Seller's
Units are unique, that any claim for monetary damages may not constitute an
adequate remedy, and that it may therefore be necessary for the protection of
the parties and to carry out the terms of this Agreement to apply for the
specific performance of the provisions hereof. It is accordingly hereby agreed
by all parties that no objection to the form of the action or the relief prayed
for in any proceeding for specific performance of this Agreement shall be raised
by any party, in order that such relief may be expeditiously obtained by an
aggrieved party. All parties may proceed to protect and enforce their rights
hereunder by a suit in equity or at law or other appropriate proceeding, whether
for specific performance or for an injunction against a violation of
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71
the terms hereof or in aid of the exercise of any right, power or remedy
granted hereunder or by law, equity or statute or otherwise. No course of
dealing and no delay on the part of any party hereto in exercising any right,
power or remedy shall operate as a waiver thereof or otherwise prejudice its
rights, powers or remedies, and no right, power or remedy conferred hereby
shall be exclusive of any other right, power or remedy referred to herein or
now or hereafter available at law, in equity, by statute or otherwise.
7.12. FURTHER ASSURANCES. The Seller agrees to execute and deliver,
after the date hereof, without additional consideration, such further
assurances, instruments and documents, and to take such further actions, as the
Purchaser may reasonably request in order to fulfill the intent of this
Agreement and the transactions contemplated hereby.
IN WITNESS WHEREOF, the parties hereto have executed and sealed this
Stock Purchase Agreement on the date first above written.
SELLER:
Xxxxxx Xxxxxxxxx
____________________________(seal)
Xxxxxx Xxxxxxxxx
Xxxxxxx Xxxx 6/11/96
____________________________(seal)
Xxxxxxx Xxxx
PURCHASER:
Xxxxxx Group, Inc.
By: Xxxxxx X. Xxxxxx
------------------------------
Title: President
---------------------------
Attest: Xxxx X. X'Xxxx
--------------------------
Title: Secretary
---------------------------
[corporate seal]
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EXHIBIT B
ASSIGNMENT AND ASSUMPTION OF
----------------------------
PARTNERSHIP INTEREST AGREEMENT
------------------------------
THIS ASSIGNMENT AND ASSUMPTION OF PARTNERSHIP INTEREST AGREEMENT (this
"Agreement"), made as of the 24th day of May, 1996, by and between XXXXXX X.
XXXX and XXXXXXX X. XXXX, trustees of the trust held under the Xxxxxx X. Xxxx
and Xxxxxxx X. Xxxx Trust dated November 19, 1991 (the "Hall Trust") (Xxxxxx X.
Xxxx and Xxxxxxx X. Xxxx, collectively as trustees for the Hall Trust
hereinafter referred to as "Assignor"), and XXXXXX HOTEL PROPERTIES, L.P., an
Ohio limited partnership ("Assignee"),
W I T N E S S E T H :
---------------------
WHEREAS, Assignor owns general partnership interests in Xxxxxx Amherst
Joint Venture and Xxxxxx Columbus Joint Venture and the partner loan receivable
as each is identified in Exhibit A of the Offer to Exchange Limited Partnership
Interests in Xxxxxx Hotel Properties, L.P. for Interests In Certain Other
Partnerships ("Exchange Offer") (collectively the "Participation Interests");
WHEREAS, Assignee desires to acquire from Assignor and Assignor desires to
assign the Participation Interests to Assignee, on the terms and subject to the
conditions hereinafter stated; and
NOW, THEREFORE, for good and valuable consideration received to the full
satisfaction of each of them, the parties agree as follows:
A. TRANSFER OF PARTICIPATION INTERESTS. Upon the terms and subject to the
conditions set forth herein, Assignor agrees to convey, transfer, assign and
deliver to Assignee at the Closing, and Assignee agrees to accept an assignment
from Assignor at the Closing, all of Assignor's right, title, estate and
interest
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73
in and to the Participation Interests, free and clear of all liens, security
interests and encumbrances whatsoever.
B. CONSIDERATION FOR PARTICIPATION INTERESTS. The consideration to be paid
by Assignee for the Participation Interests shall be limited partnership
interests in the Assignee (the "Units") identified on Exhibit A of the Exchange
Offer. The payment of consideration for the Participation Interests (which shall
be payable to the Trustee(s) of the trust held under the Xxxxxxx X. Xxxx Trust
dated December 20, 1995) shall be payable at Closing, which payment is
conditional upon the completion of the offering to the public of common shares
("Shares") of stock (the "IPO") by the general partner of the Assignee and the
closing conditions set forth in Section F of this Agreement.
In the event of the completion of the IPO as described above, the Assignee
shall be obligated, subject to the closing conditions set forth in Section F of
this Agreement, to acquire the Participation Interests.
C. CONFIDENTIAL OFFERING MEMORANDUM. Assignee has delivered the Exchange
Offer, together with copies of the most recent drafts of the Registration
Statement to be filed with the Securities and Exchange Commission with respect
to the IPO (the "Registration Statement") and Limited Partnership Agreement of
Assignee to Assignor, offering to acquire the Participation Interests in
exchange for Units.
D. ASSIGNOR'S REPRESENTATIONS AND WARRANTIES. Assignor hereby represents
and warrants to Assignee as of the date hereof that:
(1) Assignor is the sole owner of the Partnership Interests
identified on Exhibit A of the Exchange Offer.
(2) Assignor has all necessary power and authority to enter into
this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby, without the consent or
authorization of, or notice to, any third party, except those third
parties to whom such consents or authorizations have been or will be
obtained, or to whom notices have been or will be given, prior to the
Closing. This Agreement constitutes, and the other documents and
instruments to be delivered by Assignor pursuant hereto when delivered
will constitute, the
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legal, valid and binding obligations of Assignor, enforceable against
Assignor in accordance with their respective terms.
(3) To the best of Assignor's knowledge, there is no litigation,
proceeding or action pending or threatened against or relating to
Assignor which might materially and adversely affect Assignor or which
questions the validity of this Agreement or any action taken or to be
taken by Assignor pursuant hereto.
(4) Neither the execution of this Agreement nor the consummation
of the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a
default under any term or provision of any agreement, instrument or
lease to which Assignor is a party.
(5) At Closing, Assignor will own good, valid and marketable
title to the Participation Interests (identify on Exhibit A of the
Exchange Offer), free and clear of all mortgages, pledges, liens,
security interests, encumbrances and restrictions of any nature
whatsoever.
Assignor also makes the further representation that nothing in this
Agreement shall operate to release Assignor from any liabilities or obligations
for which Assignor would otherwise be responsible arising out of or in
connection with the ownership of the Participation Interests or the Xxxxxx
Marriott Hotels relating to any periods prior to the Closing.
All of the representations and warranties set forth in this Section D shall
be deemed renewed by Assignor on the Closing Date as if made at such time.
E. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents and
warrants to Assignor that:
(1) Assignee is, and will be at the Closing, a limited
partnership duly organized, validly existing and in good standing
under the laws of the State of Ohio and is, or at Closing will be,
registered as a foreign limited partnership in each jurisdiction in
which it is engaging in business or expects to do so. Assignee has,
and at the Closing will have, the power and authority to carry on the
business for which it has been organized. The persons executing this
Agreement on behalf of Assignee are duly authorized to do so, and all
requisite action has been taken by
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Assignee to authorize the execution and delivery of this Agreement,
the performance by Assignee of its obligations hereunder and the
consummation of the transactions contemplated hereby.
(2) To the best of Assignee's knowledge, there is no litigation,
proceeding or action pending or threatened against or related to
Assignee which might materially and adversely Assignee or which
questions the validity of this Agreement or any action taken or to be
taken by Assignor pursuant hereto.
(3) Assignee has all necessary power and authority to enter into
this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby, without the consent or
authorization of, or notice to, any third party, except those third
parties to whom such consents or authorizations have been or will be
obtained, or to whom notices have been or will be given, prior to the
Closing. This Agreement constitutes, and the other documents and
instruments to be delivered by Assignee pursuant hereto when delivered
will constitute, the legal, valid and binding obligations of Assignee,
enforceable against Assignee in accordance with their respective
terms.
(4) Neither the execution of this Agreement nor the consummation
of the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a
default under any term or provision of any agreement, instrument or
lease to which Assignee is a party.
All of the representations and warranties set forth in this Section E shall
be deemed renewed by Assignee on the Closing Date as if made at such time and
shall survive the closing of the transactions contemplated hereby for a period
of six months.
F. DELIVERIES; CONDITIONS. Assignee shall issue or deliver the following to
or for the benefit of Assignor on or prior to the Closing Date:
(1) the consideration for the Participation Interests;
(2) duly executed resolutions adopted by Assignee authorizing the
execution and delivery of this Agreement by Assignee, the performance by
Assignee of its obligations hereunder and the consummation of the transactions
contemplated hereby;
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(3) the releases required pursuant to Section I hereof;
G. CLOSING DATE. Unless the parties otherwise agree in writing, the
transactions contemplated hereby shall be closed (the "Closing") simultaneously
with the completion of the IPO, provided such offering occurs on or before
December 31, 1996 (the "Closing Date"). If the Closing has not occurred by the
Closing Date, this Agreement shall terminate, in which event all documents and
instruments which may have been delivered by one party to the other party shall
be returned, and neither party hereto shall thereafter be under any further
liability to the other party hereto.
H. CERTAIN EXPENSES AND CHARGES. Assignee shall be charged the following
amounts at Closing: the Purchase Price, and all other costs and expenses
necessary to effect the purchase of the Participation Interests.
I. RELEASES; INDEMNIFICATION.
(1) Assignee shall use reasonable efforts to attempt to obtain
releases of Assignor (in form and substance acceptable to Assignor in his
reasonable discretion) and to the extent such releases are not obtained,
hereby agrees to assume and indemnify Assignor, from any and all personal
liability to any lenders of Xxxxxx Amherst Joint Venture and Xxxxxx
Columbus Joint Venture that accrues from and after the Closing Date.
(2) Assignee shall fully indemnify and hold Assignor and Assignor's
trustee, heirs, representatives, successors and assigns harmless from and
against any and all claims, demands, losses, liabilities, damages and
expenses (including reasonable attorneys' fees) arising out of or in
connection with (i) the failure of Assignee to perform in any material
respect any of its obligations hereunder, (ii) the inaccuracy of any
representation or warranty made by Assignee hereunder (except to the extent
that such indemnification obligation would arise directly as a result of
the inaccuracy of any representation, warranty or covenant made by Assignor
hereunder), and (iii) the activity of Xxxxxx Amherst Joint Venture and
Xxxxxx Columbus Joint Venture and/or the operation of the Xxxxxx Marriott
Hotels from and after the Closing.
(3) Assignor shall fully indemnify Assignee and hold Assignee, its
officers, directors and partners and their respective representatives,
successors and assigns harmless from and against
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any and all claims, demands, losses, liabilities, damages and expenses
(including reasonable attorneys' fees) arising out of or in connection with
(i) the failure of Assignor to perform in any material respect any of its
obligations hereunder, (ii) the inaccuracy of any representation or
warranty made by Assignor hereunder (except to the extent that such
indemnification obligation would arise directly as a result of the
inaccuracy of any representation, warranty or covenant made by Assignee
hereunder) or (iii) the activity of Xxxxxx Amherst Joint Venture and Xxxxxx
Columbus Joint Venture and the operation of the Xxxxxx Marriott Hotels
prior to the Closing.
J. CONSENTS. Assignee has entered into or will enter into an agreement to
purchase other partnership interest from other general partners of the
partnership whose interests are the subject of this Agreement and hereby
consents to each and every transaction contemplated by this Agreement. Assignor
hereby consents to (i) the transfer by any partner of such partner's interest to
Assignee or Assignee's nominee, (ii) the transfer by the partnerships in
connection with the transactions contemplated by this Agreement, of all or
substantially all the assets of the partnerships, including, without limitation,
the liquor licenses and Franchise Agreements with Marriott Corporation, to
Assignee or Assignee's nominee and (iii) a waiver of any rights of first
refusal, options or other rights which could be asserted by Assignor in
connection with any agreements regarding the transfer of the Participation
Interests to Assignee or related to the ownership or operation of the Xxxxxx
Marriott Hotels. Assignor also consents to the substitution of Assignee as a
partner in Xxxxxx Amherst Joint Venture and Xxxxxx Columbus Joint Venture upon
completion of the transfer referenced above. Assignor agrees to execute any
documents and instruments, and shall take or cause to be taken such further
action, as may be necessary at any time or from time to time in order to
effectuate Assignor's consent referenced herein.
In the event the Closing does not occur as provided in Section G, the
various consents referenced above shall be automatically deemed revoked by
Assignor and Assignor and Assignee agree to execute any documents and
instruments necessary in order to effect said revocation and to place Assignor
in the same position as if this Agreement had not been executed by Assignor.
K. ASSIGNMENT. Assignee has the right, upon five (5) days' written notice
to Assignor, to assign and transfer its interest in this Agreement to an entity
that is taxable as a partnership and that is
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controlled by Assignee or the Xxxxxx Family. In such event, provided that any
such transferee agrees in writing to assume all of Assignee's obligations
hereunder, Assignee shall be released from any and all liability hereunder as of
the effective date of such assignment.
L. ASSIGNMENT AND ASSUMPTION OF PARTICIPATION INTERESTS. Subject to the
terms and conditions herein:
(1) Assignor does hereby sell, convey and assign to Assignee its
rights and interests in (i) the partner loan identified on Exhibit A to the
Exchange Offer, (ii) a 4.286% general partnership Xxxxxx Amherst Joint
Venture, an Ohio general partnership, and (iii) a 4.143% general
partnership interest in Xxxxxx Columbus Joint Venture, an Ohio general
partnership (the "Partnerships"), and in and to the partnership agreements
forming the Partnerships dated as of ____________, 19__ for the Xxxxxx
Amherst Joint Venture, and dated as of ____________, 19__ for the Xxxxxx
Columbus Joint Venture, as each may have been amended from time to time.
(2) Assignee hereby agrees to assume, discharge and release Assignor
as general partner of the Partnerships to the extent of the interest hereby
assigned from, and agrees to indemnify Assignor against, all obligations
which may accrue from and after the Closing Date by virtue of Partnerships
or the partnership agreements applicable to the interests hereby assigned
and does further agree to be bound by all the terms, conditions and
provisions of the partnership agreement and to be a general partner in the
Partnerships for all purposes and to the full extent of the interest hereby
assigned.
M. MISCELLANEOUS.
(1) This Agreement, together with the Exchange Offer together with the
exhibits thereto shall be deemed to contain all of the terms and conditions
agreed upon with respect to the subject matter hereof, it being understood
that there are no outside representations or oral agreements.
(2) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, permitted assigns,
heirs and personal representatives.
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(3) The parties shall execute and deliver such further documents and
instruments of conveyance, sale, assignment, transfer or otherwise, and
shall take or cause to be taken such other or further action as either
party shall reasonably request at any time or from time to time in order to
effectuate the terms and provisions of this Agreement.
(4) This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio.
(5) This Agreement will survive the Closing and the delivery of the
documents contemplated herein.
IN WITNESS WHEREOF, the parties hereto have signed three counterparts
of this Agreement, each of which shall be deemed to be an original document, as
of the date set forth above.
ASSIGNOR:
/s/ Xxxxxx X. Xxxx, Trustee
-----------------------------
Xxxxxx X. Xxxx, Trustee
of the Hall Trust
/s/ Xxxxxxx X. Xxxx, Trustee
-----------------------------
Xxxxxxx X. Xxxx, Trustee
of the Hall Trust
ASSIGNEE:
XXXXXX HOTEL PROPERTIES, L.P. an Ohio limited partnership
By: Xxxxxx Hotel Properties, Inc., its general partner
/s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx,
President
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EXHIBIT A
Confidential Offering Memorandum
PARTICIPATING PARTNER
---------------------
Offeree:
Xxxxxx X. Xxxx and Xxxxxxx X. Xxxx Trustees the trust held under the
Xxxxxx X. Xxxx and Xxxxxxx X. Xxxx Trust dated November 19, 1991
(the "Hall Trust")
----------------------------------------
Participation Interests to be Exchanged:
----------------------------------------
1) 4.143% general partnership interest in Xxxxxx Columbus Joint Venture
("BCJV")(1), including the amount owed by BCJV (if any) at Closing pursuant
to an advance made by the predecessor in interest to the Hall Trust on or
about November 2, 1991 in the original principal amount of approximately
$6,250 (the "Partner Loan")
2) 4.286% general partnership interest in Xxxxxx Amherst Joint Venture(2)
Operating Partnership Interests to be Received:
-----------------------------------------------
The number of Operating Partnership Interests to be received shall equal
($213,000) Two Hundred Thirteen Thousand Dollars divided by the Offering Price
of the REIT Shares in the REIT Offering.
--------------------
(1) Joint owner of Columbus Hotel Joint Venture which owns the Columbus
Marriott.
(2) Joint owner of Buffalo Hotel Joint Venture which owns the Buffalo Marriott.
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81
Form of Partnership Interest and Partner Loan Purchase
Agreement Applicable To:
Date % Xxxxxx Amherst % Xxxxxx Columbus Partner Loan Purchase Price
---- ---------------- ----------------- ------------ --------------
1. Xxxx X. Xxxxxxx 3/18/96 .857 .829 $1,250 $56,000
2. Xxxxxx X. Xxxxxx 5/22/96 .857 .829 1,250 56,000
3. Xxxxx Xxxxxx 5/22/96 .857 .829 1,250 56,000
4. Xxxxxx X. Ceiless 5/22/96 3.429 3.315 5,000 224,000
5. Xxxxxx X. Xxxxxxxxx 5/22/96 2.571 2.486 3,750 168,000
6. Xxxxxx X. X'Xxxxx 3/21/96 1.143 1.105 1,667 57,560
7. Xxxxxx X. Xxxxxxx 3/22/96 .857 .829 1,250 56,000
82
PARTNERSHIP INTEREST AND PARTNER LOAN
PURCHASE AGREEMENT
------------------
THIS PURCHASE AGREEMENT (this "Agreement"), made as of the __th day of
_____, 1996, by and between _______________________, an individual ("Seller"),
and XXXXXX ARES HOTEL PROPERTIES, L.P., an Ohio limited partnership, or its
nominee(s) ("Buyer"),
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, Seller owns a general partnership interest (collectively the
"Partnership Interests") of _____% in Xxxxxx Amherst Joint Venture _____% in
Xxxxxx Columbus Joint Venture (collectively the "Partnerships");
WHEREAS, the Partnerships have an ownership interest in the Buffalo
Marriott Hotel and Columbus North Marriott Hotel, respectively, (collectively
the "Properties"); and
WHEREAS, Xxxxxx Columbus Joint Venture owes Seller a certain sum
pursuant to an advance made by Seller on or about November 2, 1991, in the
original principal amount of ______________________ ($_____) (the "Partner
Loan");
WHEREAS, Buyer desires to purchase from Seller, and Seller desires to
sell the Partnership Interests and the Partner Loan to Buyer, on the other
terms and subject to the conditions hereinafter stated;
NOW, THEREFORE, for good and valuable consideration received to the
full satisfaction of each of them, the parties agree as follows:
1. PURCHASE AND SALE OF PARTNERSHIP INTERESTS AND PARTNER LOAN.
Upon the terms and subject to the conditions set forth herein, Seller agrees to
convey, sell, transfer, assign and deliver to Buyer at the Closing (as
hereinafter defined), and Buyer agrees to buy and take from Seller at the
Closing, all of Seller's right, title, estate and interest in and to the
Partnership Interests and the Partner Loan, free and clear of all liens,
security interests and encumbrances whatsoever.
2. CONSIDERATION AND PAYMENT. The purchase price for the
Partnership Interests and the Partner Loan shall be _______________
($_________) less the sum of (i) payments made to Seller on the Partner Loan
(if any) from January 1, 1996 through Closing, and (ii) cash distributions to
Seller from the Partnerships (if any) from January 1, 1996 through Closing (the
"Purchase Price").
The Purchase Price shall be paid in cash by Buyer to Seller at Closing.
Delivery of the Purchase Price by Buyer to Seller for the Partnership Interests
and the Partner Loan shall be a condition to Closing with respect to such
Partnership Interests. At anytime prior to the Closing, Buyer shall have the
right to elect not to proceed with the acquisition of the Partnership Interests
and the Partner Loan, such election to be exercised by written notice to
Seller.
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83
3. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller hereby
represents and warrants to Buyer as of the date hereof that:
(a) Seller has all necessary power and authority to enter into this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby, without the consent or authorization of,
or notice to, any third party, except those third parties from whom such
consents or authorizations have been or will be obtained, or to whom
notices have been or will be given, prior to the Closing. This Agreement
constitutes, and the other documents and instruments to be delivered by
Seller pursuant hereto when delivered will constitute, the legal, valid and
binding obligations of Seller.
(b) To the best of Seller's knowledge, there is no litigation,
proceeding or action pending or threatened against or relating to Seller
which questions the validity of this Agreement or any action taken or to
be taken by Seller pursuant hereto.
(c) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a default
under any term or provision of any agreement, instrument or lease to which
Seller is a party.
(d) Seller owns good, valid and marketable title to the Partnership
Interests and the Partner Loan, free and clear of all mortgages, pledges,
liens, security interests, encumbrances and restrictions of any nature
whatsoever.
All of the of the representations and warranties set forth in this
Section 3 shall be deemed renewed by Seller on the Closing Date as if made at
such time and shall survive the Closing contemplated hereby for a period of six
months.
4. DELIVERIES.
(a) Seller shall execute and deliver to Buyer, at or prior to
Closing, a good and sufficient Assignment and Assumption of Partnership
Interests and Partner Loan, in form acceptable to Buyer, conveying,
selling, transferring, assigning and delivering to Buyer good and
marketable title to the Partnership Interests and Partner Loan, free and
clear of all mortgages, pledges, liens, security interests, encumbrances
and restrictions (the "Assignment Agreement") and any other documents
reasonable necessary to effect the sale of the Partnership Interests and
Partner Loan to Buyer.
(b) Buyer shall issue or deliver the following to or for the
benefit of Seller on or prior to the Closing Date (i) the Purchase Price;
and (ii) the Assignment Agreement.
5. CLOSING DATE. Unless the parties otherwise agree in writing,
the transactions contemplated hereby shall be closed (the "Closing") on a date
selected by Buyer that is on or before December 31, 1996 (the "Closing Date").
Seller acknowledges that Buyer may at any time elect not to purchase the
Partnership Interests and Partner Loan if Buyer and its affiliates do not
proceed with an initial public offering of shares in a newly-formed real estate
investment trust. If the Closing has not occurred on or before December 31,
1996, either party, provided such party is not in default under this Agreement,
shall have the right to terminate this Agreement by giving notice to the other
party, in which event all
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documents and instruments which may have been delivered by one party to the
other party shall be returned, and on any such termination or election not to
purchase, neither party hereto shall thereafter be under any further liability
to the other party hereto.
6. INDEMNIFICATION.
(a) Buyer shall fully indemnify and hold Seller and Seller's heirs,
representatives, successors and assigns harmless from and against any and
all claims, demands, losses, liabilities, damages and expenses (including
reasonable attorneys' fees) arising out of or in connection with (i) the
failure of Buyer to perform in any material respect any of its obligations
hereunder, or (ii) arising out of the activity of the Partnerships and/or
the operation of the Properties from and after the Closing (except to the
extent that such indemnification obligation would arise directly as a
result of the inaccuracy of any representation, warranty or covenant made by
Seller hereunder).
(b) Seller shall fully indemnify Buyer and hold Buyer, its officers
and directors and their respective representatives, successors and assigns
harmless from and against any and all claims, demands, losses, liabilities,
damages and expenses (including reasonable attorneys' fees) arising out of
or in connection with (i) the failure of Seller to perform in any material
respect any of its obligations hereunder, (ii) the inaccuracy of any
representation or warranty made by Seller hereunder or (iii) the ownership
of the Partnership Interests and the Partner Loan and any activities,
obligations or liabilities of each of the Partnerships relating to periods
prior to the Closing.
7. CONSENTS. Buyer has entered into or will enter into agreements
to purchase general partnership interests from other partners of the
Partnerships. Seller hereby consents to (i) the transfer by any general partner
of the Partnerships of such general partner's general partnership interest(s)
to Buyer or Buyer's nominee, (ii) the transfer by the Partnerships to Buyer or
Buyer's nominee of all or substantially all of the assets of the Partnerships
prior to or simultaneously with the closing, including, without limitation, the
furniture, fixtures and equipment owned by the Partnerships, the liquor license
and franchise agreement with Marriott and (iii) a waiver of any and all other
rights which could have been asserted in regard to the transfer of the
Partnership Interests and the Partnership Loan. Seller also consents to the
substitution of Buyer as a general partner in the Partnerships upon completion
of the transfer referenced above. Seller agrees to execute any documents and
instruments, and shall take or cause to be taken such further action, as may be
necessary at any time or from time to time in order to effectuate Seller's
consent referenced herein.
8. PURCHASE OF THE PROPERTIES. At any time prior to ten (10) days
before the Closing Date, Buyer may elect by written notice to Seller to
purchase either or both of the Properties in lieu of the Partnership Interests.
In such event, Seller shall provide Buyer with such action as Buyer shall
reasonably request in order to convey either or both of the Properties to
Buyer. In such event, the Seller shall receive the Purchase Price as
consideration for Seller's percentage interests in the Properties.
9. MISCELLANEOUS.
(a) This Agreement shall be deemed to contain all of the terms and
conditions agreed upon with respect to the subject matter hereof, it being
understood that there are no outside representations or oral agreements.
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85
(b) This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors, permitted assigns,
heirs and personal representatives.
(c) The parties shall execute and deliver such further documents
and instruments of conveyance, sale, assignment, transfer or otherwise, and
shall take or cause to be taken such other or further action as either
party shall reasonably request at any time or from time to time in order to
effectuate the terms and provisions of this Agreement. The provisions of
this Section shall survive the Closing.
(d) This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio.
IN WITNESS WHEREOF, the parties hereto have signed three counterparts
of this Agreement, each of which shall be deemed to be an original document, as
of the date set forth above.
SELLER:
Witnesses:
/s/ By: /s/
------------------------ --------------------------
/s/
------------------------
BUYER:
Witnesses:
XXXXXX ARES HOTEL PROPERTIES,
L.P.
BY: XXXXXX ARES HOTEL
PROPERTIES, INC.,
GENERAL PARTNER
/s/ By: /s/ Xxxxxx X. Xxxxxx
------------------------- --------------------------
/s/ Title: President
------------------------- ----------------------
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86
PARTNERSHIP INTEREST AND PARTNER LOAN
PURCHASE AGREEMENT
------------------
THIS PURCHASE AGREEMENT (this "Agreement"), made as of the 14th day of
April, 1996, by and between XXXXXXX X. XXXXX, an individual ("Seller"), and
XXXXXX ARES HOTEL PROPERTIES, L.P., an Ohio limited partnership, or its
nominee(s) ("Buyer"),
W I T N E S S E T H :
- - - - - - - - - - -
WHEREAS, Seller owns a general partnership interest (collectively the
"Partnership Interests") of 0.857% in Xxxxxx Amherst Joint Venture and 0.829% in
Xxxxxx Columbus Joint Venture (collectively the "Partnerships").
WHEREAS, the Partnerships have an ownership interest in the Buffalo
Marriott Hotel and Columbus North Marriott Hotel, respectively, (collectively
the "Properties"); and
WHEREAS, Xxxxxx Columbus Joint Venture owes Seller a certain sum
pursuant to an advance made by Seller on or about November 2, 1991, in the
original principal amount of one thousand two hundred fifty dollars ($1,250.00)
(the "Partner Loan");
WHEREAS, Buyer desires to purchase from Seller, and Seller desires to
sell the Partnership Interests and the Partner Loan to Buyer, on the other terms
and subject to the conditions hereinafter stated;
NOW, THEREFORE, for good and valuable consideration received to the
full satisfaction of each of them, the parties agree as follows:
1. PURCHASE AND SALE OF PARTNERSHIP INTERESTS AND PARTNER LOAN.
Upon the terms and subject to the conditions set forth herein, Seller agrees to
convey, sell, transfer, assign and deliver to Buyer at the Closing (as
hereinafter defined), and Buyer agrees to buy and take from Seller at the
Closing, all of the Seller's right, title, estate and interest in and to the
Partnership Interests and the Partner Loan, free and clear of all liens,
security interests and encumbrances whatsoever.
2. CONSIDERATION AND PAYMENT. The purchase price for the
Partnership Interests and the Partner Loan shall be fifty six thousand dollars
($56,000.00) less the sum of (i) payments made to Seller on the Partner Loan
(if any) from January 1, 1996 through Closing, and (ii) cash distributions to
Seller from the Partnerships (if any) from January 1, 1996 through Closing (the
"Purchase Price").
The Purchase Price shall be paid in cash by Buyer to Seller at Closing.
Delivery of the Purchase Price by Buyer to Seller for the Partnership Interests
and the Partner Loan shall be a condition to Closing with respect to such
Partnership Interests. At anytime prior to the Closing, Buyer shall have the
right to elect not to proceed with the acquisition of the Partnership Interests
and the Partner Loan, such election to be exercised by written notice to Seller.
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3. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller hereby
represents and warrants to Buyer as of the date hereof that:
(a) Seller has all necessary power and authority to enter into this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby, without the consent or authorization of,
or notice to, any third party, except those third parties from whom such
consents or authorizations have been or will be obtained, or to whom notices
have been or will be given, prior to the Closing. This Agreement
constitutes, and the other documents and instruments to be delivered by
Seller pursuant hereto when delivered will constitute, the legal, valid and
binding obligations of Seller.
(b) To the best of Seller's knowledge, there is no litigation,
proceeding or action pending or threatened against or relating to Seller
which questions the validity of this Agreement or any action taken or to be
taken by Seller pursuant to hereto.
(c) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a default
under any term or provision of any agreement, instrument or lease to which
Seller is a party.
(d) Seller owns good, valid and marketable title to the Partnership
Interests and the Partner Loan, free and clear of all mortgages, pledges,
liens, security interests, encumbrances and restrictions of any nature
whatsoever.
All of the representations and warranties set forth in this Section 3
shall be deemed renewed by Seller on the Closing Date as if made at such time
and shall survive the Closing contemplated hereby for a period of six months.
4. DELIVERIES.
(a) Seller shall execute and deliver to Buyer, at or prior to
Closing, a good and sufficient Assignment and Assumption of Partnership
Interests and Partner Loan, in form acceptable to Buyer, conveying, selling,
transferring, assigning and delivering to Buyer good and marketable title to
the Partnership Interests and Partner Loan, free and clear of all mortgages,
pledges, liens, security interests, encumbrances and restrictions (the
"Assignment Agreement") and any other documents reasonably necessary to
effect the sale of the Partnership Interests and Partner Loan to Buyer.
(b) Buyer shall issue or deliver the following to or for the benefit
of Seller on or prior to the Closing Date (i) the Purchase Price; and (ii)
the Assignment Agreement.
5. CLOSING DATE. Unless the parties otherwise agree in writing,
the transactions contemplated hereby shall be closed (the "Closing") on a date
selected by Buyer that is on or before December 31, 1996 (the "Closing Date").
Seller acknowledges that Buyer may at any time elect not to purchase the
Partnership Interests and Partner Loan if Buyer and its affiliates do not
proceed with an initial public offering of shares in a newly-formed real estate
investment trust. If the Closing has not occurred on or before December 31,
1996, this Agreement shall terminate
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and neither party hereto shall thereafter be under any further liability to the
other party hereto.
6. INDEMNIFICATION.
---------------
(a) Buyer shall fully indemnify and hold Seller and Seller's
heirs, representatives, successors and assigns harmless from against
any and all claims, demands, losses, liabilities, damages and expenses
(including reasonable attorneys' fees) arising out of or in connection
with (i) the failure of Buyer to perform in any material respect any of
its obligations hereunder, or (ii) arising out of the activity of the
Partnerships and/or the operation of the Properties from and after the
Closing (except to the extent that such indemnification obligation
would arise directly as a result of the inaccuracy of any
representation, warranty or covenant made by Seller hereunder).
(b) Seller shall fully indemnify Buyer and hold Buyer, its
officers and directors and their respective representatives, successors
and assigns harmless from and against any and all claims, demands,
losses, liabilities, damages and expenses (including reasonable
attorneys' fees) arising out of or in connection with (i) the failure
of Seller to perform in any material respect any of its obligations
hereunder, (ii) the inaccuracy of any representation or warranty made
by Seller hereunder.
7. CONSENTS. Buyer has entered into or will enter into
agreements to purchase general partnership interests from other partners of the
Partnerships together, the "Purchase." In conjunction solely with the
Purchase, and provided the closing occurs during 1996, Seller hereby consents
to (i) the transfer by any general partner of the Partnerships of such general
partnership interest(s) to Buyer or Buyer's nominee, (ii) the transfer by the
Partnerships to Buyer or Buyer's nominee of all or substantially all of the
assets of the Partnerships prior to or simultaneously with the closing,
including, without limitation, the furniture, fixtures and equipment owned by
the Partnerships, the liquor license and franchise agreement with Marriott and
(iii) a waiver of any and all other rights which could have been asserted in
regard to the transfer of the Partnership Interests and the Partner Loan.
Seller also consents to the substitution of Buyer as a general partner in the
Partnerships upon completion of the transfer referenced above. Seller agrees to
execute any documents and instruments, and shall take or cause to be taken such
further action, as may be necessary at any time or from time to time in order
to effectuate Seller's consent referenced herein. The foregoing consents are
conditioned upon the closing occurring by 12/31/96. If the closing does not
occur by 12/31/96, my consents shall no longer be effective.
8. PURCHASE OF THE PROPERTIES. At any time prior to ten (10)
days from the Closing Date, Buyer may elect by written notice to Seller to
purchase either or both of the Properties in lieu of the Partnership Interests.
In such event, Seller shall provide Buyer with such action as Buyer shall
reasonably request in order to convey either or both of the Properties to
Buyer. In such event, the Seller shall receive the Purchase Price plus a
distribution of available cash from the Partnerships as consideration for
Seller's percentage interest in the Properties.
9. MISCELLANEOUS.
-------------
(a) This Agreement shall be deemed to contain all of the terms
and conditions agreed upon with respect to the subject matter hereof,
it being understood that there are no outside representations or oral
agreements.
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89
(b) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors,
permitted assigns, heirs and personal representatives.
(c) The parties shall execute and deliver such further
documents and instruments of conveyance, sale, assignment, transfer or
otherwise, and shall take or cause to be taken such other or further
action as either party shall reasonably request at any time or from
time to time in order to effectuate the terms and provisions of this
Agreement. The provisions of this Section shall survice the Closing.
(d) This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
IN WITNESS WHEREOF, the parties hereto have signed three
counterparts of this Agreement, each of which shall be deemed to be an original
document, as of the date set forth above.
SELLER:
Witnesses:
/s/ Xxxx X. Xxxxxxx By: /s/ Xxxxxxx X. Xxxxx
------------------------ -------------------------
/s/ Xxxx Xxxxxx
------------------------
Witness: BUYER:
XXXXXX ARES HOTEL PROPERTIES,
L.P.
BY: XXXXXX ARES HOTEL PROPERTIES, INC.
GENERAL PARTNER
/s/ Xxxxx Xxxxxx By: Xxxxxx X. Xxxxxx
------------------------ --------------------------
/s/ Xxxxx X. Hirakas Title: President
------------------------ ----------------------
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90
ASSIGNMENT AND ASSUMPTION OF
----------------------------
PARTNERSHIP INTEREST AGREEMENT
------------------------------
THIS ASSIGNMENT AND ASSUMPTION OF PARTNERSHIP INTEREST AGREEMENT (this
"Agreement"), made as of the 22nd day of May, 1996, by and between Xxxxxxx X.
Xxxxxx trustee of each the trusts held under (i) the Declaration of Xxxxxxx X.
Xxxxxx Trust Agreement Xx. 0 xxxxx Xxxxxxx 00, 0000, ("Xxxxx 0"), (xx) the
Declaration of Xxxxxxx X. Xxxxxx Trust Agreement No. 2 dated October 14, 1987,
("Trust 2") and, (iii) the Declaration of Xxxxxxx X. Xxxxxx Trust Agreement No.
3 dated October 14, 1987 ("Trust 3") (Xxxxxxx X. Xxxxxx in his collective
capacity as trustee for Trust 1, Trust 2 and Trust 3 is hereinafter referred as
"Assignor"), and XXXXXX HOTEL PROPERTIES, L.P., an Ohio limited partnership
("Assignee"),
W I T N E S S E T H :
--------------------
WHEREAS, Assignor owns general partnership interests in Beachwood Hotel
Joint Venture, Xxxxxx Amherst Joint Venture, Xxxxxx Columbus Joint Venture and
the Partner Loan receivable as each is identified in Exhibit A of the Offer to
Exchange Limited Partnership Interests in Xxxxxx Hotel Properties, L.P. for
Interests In Certain Other Partnerships ("Exchange Offer") (collectively the
"Participation Interests");
WHEREAS, Assignor agrees to enter into a Merger of Trust Agreement
effecting (prior to the time of Closing (as hereinafter defined)) the merger of
Trust 1 and Trust 2 into Trust 3 for all purposes;
WHEREAS, Assignee desires to acquire from Assignor and Assignor desires
to assign the Participation Interests to Assignee, on the terms and subject to
the conditions hereinafter stated; and
NOW, THEREFORE, for good and valuable consideration received to the
full satisfaction of each of them, the parties agree as follows:
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A. TRANSFER OF PARTICIPATION INTERESTS. Upon the terms and subject to the
conditions set forth herein, Assignor agrees to convey, transfer, assign and
deliver to Assignee at the Closing, and Assignee agrees to accept an assignment
from Assignor at the Closing, all of Assignor's right, title, estate and
interest in and to the Participation Interests, free and clear of all liens,
security interests and encumbrances whatsoever.
B. CONSIDERATION FOR PARTICIPATION INTERESTS. The consideration to be paid
by Assignee for the Participation Interests shall be limited partnership
interests in the Assignee (the "Units") identified on Exhibit A of the Exchange
Offer. The payment of consideration for the Participation Interests shall be
payable at Closing, which payment is conditional upon the completion of the
offering to the public of common shares ("Shares") of stock (the "IPO") by the
general partner of the Assignee and the closing conditions set forth in Section
F of this Agreement.
In the event of the completion of the IPO as described above, the Assignee
shall be obligated, subject to the closing conditions set forth in Section F of
this Agreement, to acquire the Participation Interests.
C. CONFIDENTIAL OFFERING MEMORANDUM. Assignee has delivered the Exchange
Offer, together with copies of the most recent drafts of the Registration
Statement to be filed with the Securities and Exchange Commission with respect
to the IPO (the "Registration Statement") and Limited Partnership Agreement of
Assignee to Assignor, offering to acquire the Participation Interests in
exchange for Units.
D. ASSIGNOR'S REPRESENTATIONS AND WARRANTIES. Assignor hereby represents
and warrants to Assignee as of the date hereof that:
(1) Assignor is the sole owner of the Partnership Interests identified
on Exhibit A of the Exchange Offer.
(2) Assignor has all necessary power and authority to enter into this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby, without the consent or authorization of,
or notice to, any third party, except those third parties to whom such
consents or authorizations have been or will be obtained, or to whom
notices have
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been or will be given, prior to the Closing. This Agreement
constitutes, and the other documents and instruments to be delivered
by Assignor pursuant hereto when delivered will constitute, the
legal, valid and binding obligations of Assignor, enforceable against
Assignor in accordance with their respective terms.
(3) To the best of Assignor's knowledge, there is no litigation,
proceeding or action pending or threatened against or relating to
Assignor which might materially and adversely affect Assignor or which
questions the validity of this Agreement or any action taken or to be
taken by Assignor pursuant hereto.
(4) Neither the execution of this Agreement nor the consummation
of the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a
default under any term or provision of any agreement, instrument or
lease to which Assignor is a party.
(5) Neither Assignor, nor, to the best of Assignor's knowledge
any prior owner of the Beachwood Marriott, Buffalo Marriott, or
Columbus Marriott (collectively the "Xxxxxx Marriott Hotels") has: (a)
caused or permitted the generation, manufacture, refinement,
transportation, treatment, storage, handling, installation, removal,
disposal, transfer, production or processing of Hazardous Substances
(as hereinafter defined) or other dangerous or toxic substances, or
solid wastes, except in strict compliance with all laws: (b) caused or
permitted or received any written notice or have any actual knowledge
of the Release (as hereinafter defined) or existence of any Hazardous
Substances on or about the Xxxxxx Marriott Hotels or property
surrounding the Xxxxxx Marriott Hotels which might affect the Xxxxxx
Marriott Hotels; (c) caused or permitted or received any written
notice or have any actual knowledge of any substances or conditions on
or about the Xxxxxx Marriott Hotels or on property surrounding the
Xxxxxx Marriott Hotels which may support a claim or cause of action,
whether by any governmental authority or any other person, under any
laws ("Environmental Laws") in effect as of the date of this Agreement
and all rules and regulations promulgated thereunder, including, but
not limited to: the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, 42 U.S.C. Sections 9601 et seq. (the
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93
"Superfund Act"); the Resource Conservation and Recovery Act of 1976,
42 U.S.C. Sections 6921 et seq.; the Toxic Substances Control Act, 15
U.S.C. Section 2601 et seq.; the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. Section 136; the Federal Water Pollution
Control Act, 33 U.S.C. Sections 1251 et seq.; the Hazardous Materials
Transportation Act, 49 U.S.C. Sections 1801 et seq.; the Federal Solid
Waste Disposal Act, 42 U.S.C. Sections 6901 et seq.; the Clean Air
Act, 42 U.S.C. Section 7401 et seq.; or any other Law. For the
purposes of this Agreement the terms "Hazardous Substances" and
"Release" shall have the definitions used in the Superfund Act;
provided, however, that the definition of the term "Hazardous
Substances" shall also include (if not included within definition
contained in the Superfund Act), petroleum and related by products,
hydrocarbons, radon, asbestos, urea formaldehyde and polychlorinated
biphenyl compounds ("PCB's").
(6) The Beachwood Joint Venture, Xxxxxx Amherst Joint Venture and
Xxxxxx Columbus Joint Venture (herein after the "Partnerships"), the
Xxxxxx Marriott Hotels, and the conduct by Partnerships of their
business relating thereto are in compliance in all material respects
with all applicable laws, ordinances and regulations of proper public
authorities, and neither Assignor nor the Partnerships has written
notice or actual knowledge of any material violation, whether actual,
claimed or alleged, thereof.
(7) True, correct and complete copies of all maintenance and
service contracts, supply contracts, employment contracts, collective
bargaining agreements, employee benefit plans, personal property
leases, insurance policies and other agreements, contracts and
contract rights to which the Partnerships are a party relating to
their ownership or operation of the Xxxxxx Marriott Hotels by the
Partnerships (the "Project Contracts"), together with any
modifications or amendments thereof, have been or will promptly be
delivered to Assignee upon Assignee's request. All of the Project
Contracts are in full force and effect. Assignor has no actual
knowledge of any action or failure to act by the Partnerships or any
other party to any Project Contract which, with the giving of notice
or the passage of time or otherwise, would constitute a default in any
material respect or otherwise entitle either party to damages or a
right to terminate, and no such
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94
other party has given written notice with respect any alleged material
default by the Partnerships under any such Project Contract.
(8) All federal, state and other taxes, assessments, fees and
other governmental charges upon the Partnerships with respect to the
Xxxxxx Hotel Marriott properties or the business conducted thereon
which are due and payable have been paid.
(9) To the best of Assignor's knowledge, with respect to all
licenses, permits, consents, authorizations, approvals and
certificates of any regulatory, administrative or other governmental
agency or body, if any, issued to or held by the Partnerships and
related to the ownership or operation of the Xxxxxx Marriott Hotels
(collectively, the "Permits"), (i) each of the Permits is currently
valid and in full force and effect, and (ii) the Permits constitute
all licenses, permits, consents, authorizations, approvals and
certificates of any regulatory, administrative or other governmental
agency or body necessary to the Partnerships' ownership or operation
of the Xxxxxx Marriott Hotels. The Partnerships is not in violation in
any material respect of any of the Permits and there is no pending or,
to the actual knowledge of Assignor, threatened proceeding which could
result in the revocation or cancellation of, or inability of the
Partnerships to renew, any Permit.
(10) At Closing, Assignor will own good, valid and marketable
title to the Participation Interests (identify on Exhibit A of the
Exchange Offer), free and clear of all mortgages, pledges, liens,
security interests, encumbrances and restrictions of any nature
whatsoever.
Assignor also makes the further representation that nothing in this
Agreement shall operate to release Assignor from any liabilities or obligations
for which Assignor would otherwise be responsible arising out of or in
connection with the ownership of the Participation Interests or the Xxxxxx
Marriott Hotels relating to any periods prior to the Closing.
All of the representations and warranties set forth in this Section D
shall be deemed renewed by Assignor on the Closing Date as if made at such time.
E. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents and
warrants to Assignor that:
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(1) Assignee is, and will be at the Closing, a limited partnership
duly organized, validly existing and in good standing under the laws of the
State of Ohio and is, or at Closing will be, registered as a foreign
limited partnership in each jurisdiction in which it is engaging in
business or expects to do so. Assignee has, and at the Closing will have,
the power and authority to carry on the business for which it has been
organized. The persons executing this Agreement on behalf of Assignee are
duly authorized to do so, and all requisite action has been taken by
Assignee to authorize the execution and delivery of this Agreement, the
performance by Assignee of its obligations hereunder and the consummation
of the transactions contemplated hereby.
(2) To the best of Assignee's knowledge, there is no litigation,
proceeding or action pending or threatened against or related to Assignee
which might materially and adversely affect Assignee or which questions the
validity of this Agreement or any action taken or to be taken by Assignor
pursuant hereto.
(3) Assignee has all necessary power and authority to enter into this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby, without the consent or authorization of,
or notice to, any third party, except those third parties to whom such
consents or authorizations have been or will be obtained, or to whom
notices have been or will be given, prior to the Closing. This Agreement
constitutes, and the other documents and instruments to be delivered by
Assignee pursuant hereto when delivered will constitute, the legal, valid
and binding obligations of Assignee, enforceable against Assignee in
accordance with their respective terms.
(4) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a default
under any term or provision of any agreement, instrument or lease to which
Assignee is a party.
All of the representations and warranties set forth in this Section E shall
be deemed renewed by Assignee on the Closing Date as if made at such time and
shall survive the closing of the transactions contemplated hereby for a period
of six months.
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F. DELIVERIES; CONDITIONS. Assignee shall issue or deliver the following to
or for the benefit of Assignor on or prior to the Closing Date:
(1) the consideration for the Participation Interests;
(2) duly executed resolutions adopted by Assignee authorizing the
execution and delivery of this Agreement by Assignee, the performance by
Assignee of its obligations hereunder and the consummation of the
transactions contemplated hereby;
(3) the releases required pursuant to Section I hereof;
G. CLOSING DATE. Unless the parties otherwise agree in writing, the
transactions contemplated hereby shall be closed (the "Closing") simultaneously
with the completion of the IPO, provided such offering occurs on or before
December 31, 1996 (the "Closing Date"). If the Closing has not occurred by the
Closing Date, this Agreement shall terminate, in which event all documents and
instruments which may have been delivered by one party to the other party shall
be returned, and neither party hereto shall thereafter be under any further
liability to the other party hereto.
H. CERTAIN EXPENSES AND CHARGES. Assignee shall be charged the following
amounts at Closing: the Purchase Price, and all other costs and expenses
necessary to effect the purchase of the Participation Interests.
I. RELEASES; INDEMNIFICATION.
(1) Assignee shall use reasonable efforts to attempt to obtain
releases of Assignor (in form and substance acceptable to Assignor in his
reasonable discretion) and to the extent such releases are not obtained,
hereby agrees to assume and indemnify Assignor, from any and all personal
liability to any lenders of the Partnerships that accrues from and after
the Closing Date.
(2) Assignee shall fully indemnify and hold Assignor and Assignor's
trustee, heirs, representatives, successors and assigns harmless from and
against any and all claims, demands, losses, liabilities, damages and
expenses (including reasonable attorneys' fees) arising out of or in
connection with (i) the failure of Assignee to perform in any material
respect any of its obligations hereunder, (ii) the inaccuracy of any
representation or warranty made by Assignee hereunder (except to the extent
that such indemnification obligation would arise directly as a result of
the
B-7
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inaccuracy of any representation, warranty or covenant made by Assignor
hereunder), and (iii) the activity of the Partnerships and/or the operation
of the Xxxxxx Marriott Hotels from and after the Closing.
(3) Assignor shall fully indemnify Assignee and hold Assignee, its
officers, directors and partners and their respective representatives,
successors and assigns harmless from and against any and all claims,
demands, losses, liabilities, damages and expenses (including reasonable
attorneys' fees) arising out of or in connection with (i) the failure of
Assignor to perform in any material respect any of its obligations
hereunder, (ii) the inaccuracy of any representation or warranty made by
Assignor hereunder (except to the extent that such indemnification
obligation would arise directly as a result of the inaccuracy of any
representation, warranty or covenant made by Assignee hereunder) or (iii)
the activity of the Partnerships and the operation of the Xxxxxx Marriott
Hotels prior to the Closing.
J. CONSENTS. Assignee has entered into or will enter into an agreement to
purchase other Partnership interest from other general partners of the
partnership whose interests are the subject of this Agreement and hereby
consents to each and every transaction contemplated by this Agreement. Assignor
hereby consents to (i) the transfer by any partner of such partner's interest to
Assignee or Assignee's nominee, (ii) the transfer by the partnerships in
connection with the transactions contemplated by this Agreement, of all or
substantially all the assets of the partnerships, including, without limitation,
the liquor licenses and Franchise Agreements with Marriott Corporation, to
Assignee or Assignee's nominee and (iii) a waiver of any rights of first
refusal, options or other rights which could be asserted by Assignor in
connection with any agreements regarding the transfer of the Participation
Interests to Assignee or related to the ownership or operation of the Xxxxxx
Marriott Hotels. Assignor also consents to the substitution of Assignee as a
partner in the Partnerships upon completion of the transfer referenced above.
Assignor agrees to execute any documents and instruments, and shall take or
cause to be taken such further action, as may be necessary at any time or from
time to time in order to effectuate Assignor's consent referenced herein.
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98
In the event the Closing does not occur as provided in Section G, the
various consents referenced above shall be automatically deemed revoked by
Assignor and Assignor and Assignee agree to execute any documents and
instruments necessary in order to effect said revocation and to place Assignor
in the same position as if this Agreement had not been executed by Assignor.
K. ASSIGNMENT. Assignee has the right, upon five (5) days' written notice
to Assignor, to assign and transfer its interest in this Agreement to an entity
that is taxable as a partnership and that is controlled by Assignee or the
Xxxxxx Family. In such event, provided that any such transferee agrees in
writing to assume all of Assignee's obligations hereunder, Assignee shall be
released from any and all liability hereunder as of the effective date of such
assignment.
L. ASSIGNMENT AND ASSUMPTION OF PARTICIPATION INTERESTS. Subject to the
terms and conditions herein:
(1) Assignor does hereby sell, convey and assign to Assignee its
rights and interests in (i) the Partner Loan identified on Exhibit A to the
Exchange Offer, (ii) a 35% general partnership interest in Beachwood Hotel
Joint Venture, an Ohio general partnership, (iii) a 59.716% general
partnership Xxxxxx Amherst Joint Venture, an Ohio general partnership, and
(iv) a 59.393% general partnership interest in Xxxxxx Columbus Joint
Venture, an Ohio general partnership (the "Partnerships"), and in and to
the partnership agreements forming the Partnerships dated as of
____________, 19__ for the Beachwood Hotel Joint Venture, dated as of
____________, 19__ for the Xxxxxx Amherst Joint Venture, and dated as of
____________, 19__ for the Xxxxxx Columbus Joint Venture, as each may have
been amended from time to time.
(2) Assignee hereby agrees to assume, discharge and release Assignor
as general partner of the Partnerships to the extent of the interest hereby
assigned from, and agrees to indemnify Assignor against, all obligations
which may accrue from and after the Closing Date by virtue of the
Partnerships or the Partnership Agreements applicable to the interests
hereby assigned and does further agree to be bound by all the terms,
conditions and provisions of the Partnership Agreement and to be a general
partner in the Partnerships for all purposes and to the full extent of the
interest hereby assigned.
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M. MISCELLANEOUS.
(1) This Agreement, together with the Exchange Offer together with the
exhibits thereto shall be deemed to contain all of the terms and conditions
agreed upon with respect to the subject matter hereof, it being understood
that there are no outside representations or oral agreements.
(2) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, permitted assigns,
heirs and personal representatives.
(3) The parties shall execute and deliver such further documents and
instruments of conveyance, sale, assignment, transfer or otherwise, and
shall take or cause to be taken such other or further action as either
party shall reasonably request at any time or from time to time in order to
effectuate the terms and provisions of this Agreement.
(4) This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio.
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(5) This Agreement will survive the Closing and the delivery of the
documents contemplated herein.
IN WITNESS WHEREOF, the parties hereto have signed three counterparts of
this Agreement, each of which shall be deemed to be an original document, as of
the date set forth above.
ASSIGNOR:
/s/ Xxxxxxx X. Xxxxxx
-----------------------------
Xxxxxxx X. Xxxxxx, Trustee
of Trust 1, Trust 2 and Trust 3
/s/ Xxxx X. Xxxxxx
-----------------------------
Xxxx X. Xxxxxx, Trust Adviser
of Trust 1, Trust 2 and Trust 3
/s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx, Trust Adviser
of Trust 1, Trust 2 and Trust 3
ASSIGNEE:
XXXXXX HOTEL PROPERTIES, L.P. an Ohio limited partnership
By: Xxxxxx Hotel Properties, Inc., its general partner
/s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx,
President
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EXHIBIT A
Confidential Offering Memorandum
PARTICIPATING PARTNER
Offeree:
Xxxxxxx X. Xxxxxx trustee of
1) Trust 1
2) Trust 2
3) Trust 3
/s/ Xxxxxxx X. Xxxxxx
-------------------------------------------
Participation Interests to be Exchanged:
----------------------------------------
1) Trust 1 35% general partnership interest Beachwood Hotel Joint Venture
2) Trust 2 59.393% general partnership interest in Xxxxxx Columbus Joint
Venture ("BCJV")(1), including the amount owed by BCJV (if any)
at Closing pursuant to an advance made by Trust 2 on or about
November 2, 1991 in the original principal amount of
approximately $89,587.50 (the "Partner Loan")
3) Trust 3 59.716% general partnership interest in Xxxxxx Amherst Joint
Venture(2)
Operating Partnership Interests to be Received:
-----------------------------------------------
The number of Operating Partnership Interests to be received shall equal
($3,000,000) Three Million Dollars divided by the Offering Price of the REIT
Shares in the REIT Offering.
--------------------
(1) Joint owner of Columbus Hotel Joint Venture which owns the Columbus
Marriott.
(2) Joint owner of Buffalo Hotel Joint Venture which owns the Buffalo Marriott.
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Form of Assignment Agreement is Applicable to:
1. Xxxxxx X. Xxxxxx
2. Xxxx X. Xxxxxx
3. The Xxxxxx Group, Inc.
4. Xxxxxx Enterprises, Inc.
5. Xxxxxx Resorts, Inc.
6. Xxxxxx Berkeley, Inc.
7. Xxxxxx Berkeley One, Inc.
8. Xxxxxx Management Company
103
ASSIGNMENT AND ASSUMPTION
-------------------------
AGREEMENT
---------
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement"), made as of
the 18th day of June 1996, by and among the persons and entities identified as
Participating Partners in Exhibit A hereto (each, an "Assignor" and
collectively, the "Assignors"), and XXXXXX HOTEL PROPERTIES, L.P., an Ohio
limited partnership ("Assignee"), and The Xxxxxx Group, Inc. ("TBG").
W I T N E S S E T H :
-------------------
WHEREAS, each Assignor owns interests in certain general or limited
partnerships or limited liability companies (those identified on Exhibit A for
any Assignor hereinafter, the "Partnerships" for purposes of application of
this Agreement to that Assignor), as identified on Exhibit A -
Part I of the Offer to Exchange Limited Partnership Interests in Xxxxxx Hotel
Properties, L.P. for Interests in a Limited Liability Company and Certain Other
Partnerships dated June 13, 1996 (collectively the "Participation Interests" -
the Participation Interests include, in certain cases, an loan receivable in
connection with a loan made to Xxxxxx Columbus Joint Venture by certain
partners also identified on Exhibit A-Part I);
WHEREAS, pursuant to the Offer to Exchange Limited Partnership
Interests in Xxxxxx Hotel Properties, L.P. for Interests In a Limited Liability
Company and Certain Other Partnerships dated June 13, 1996 ("Exchange Offer"),
Assignee desires to acquire from Assignors, and Assignors desire to assign the
Participation Interests to Assignee, on the terms and subject to the conditions
hereinafter stated;
WHEREAS, as set forth on Schedule I hereto, pursuant to certain
exchange offers (the "Other Partner Exchange Offers") and agreements (the "Other
Partner Contribution and Purchase Agreements") various entities and individuals
other than Assignors (collectively, the "Other Partners") have contributed or
sold to the Assignee their interests ("Other Partner Participation Interests")
in the Partnerships and certain other entities
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(collectively, the "Other Partnerships" and together with the Partnerships, the
"Contributed Partnerships") holding ownership interests in the Initial Hotels
(as such term is defined herein);
WHEREAS, as a result of its acquisition of the Participation Interests
and the Other Partner Participation Interests pursuant to this Agreement and the
Other Partner Contribution and Purchase Agreements, the Assignee will own nine
hotels (the "Initial Hotels"); and
WHEREAS, pursuant to a registration statement on Form S-11 and a
related preliminary prospectus, Xxxxxx Lodging Trust, Inc. (the "Company"), the
general partner of the Assignee, proposes to sell to certain underwriters, a
certain amount of common shares of the Company pursuant to an underwriting
agreement to be executed by and between the Company, the Assignee and the
underwriters named therein (the "Underwriting Agreement").
NOW, THEREFORE, for good and valuable consideration received to the
full satisfaction of each of them, the parties agree as follows:
A. TRANSFER OF INTERESTS. Upon the terms and subject to the conditions
set forth herein, each Assignor agrees to convey, transfer, assign and deliver
to Assignee at the Closing, and Assignee agrees to accept an assignment from
that Assignor at the Closing, of all of Assignor's right, title, estate and
interest in and to the Participation Interests, free and clear of all liens,
security interests and encumbrances whatsoever.
B. CONSIDERATION FOR PARTICIPATION INTERESTS. The consideration to be
paid by Assignee for the Participation Interests shall be a limited partnership
interest in the Assignee (the "Units") identified on Exhibit A of the Exchange
Offer. The payment of consideration for the Participation Interests shall be
payable at Closing pursuant to the terms of Exhibit A to the Exchange Offer,
which payment is conditional upon the completion of the offering to the public
(the "IPO") of common shares ("Shares") by the general partner of the Assignee
and the closing conditions set forth in Section F of this Agreement.
In the event of the completion of the IPO as described above, the
Assignee shall be obligated, subject to the closing conditions set forth in
Section F of this Agreement, to acquire the Participation Interests.
At the sole election of the Assignee, Assignee upon written notice to
any Assignor, may elect to deposit (the "Deposit") a sum equal to the lesser
of: (a) five percent (5%) of the value of the Units to be paid to Assignor or
(b) $25,000. The amount of the Deposit (together with any interest earned
thereon) shall apply as a
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credit towards the Purchase Price. The Deposit, if paid, shall be payable to
the Assignor by certified or bank check. In the event the Closing does not
occur as provided in Section G, the Assignor shall be obligated to return said
Deposit, together with any interest earned thereon, to Assignee by certified or
bank check within ten days of such request by Assignee.
C. CONFIDENTIAL OFFERING MEMORANDUM. Assignee has delivered the
Exchange Offer, together with copies of the most recent drafts of the
Registration Statement to be filed with the Securities and Exchange Commission
with respect to the IPO (the "Registration Statement") and Partnership Agreement
of Assignee to each Assignor, offering to acquire the Participation Interests in
exchange for Units.
D. ASSIGNORS' REPRESENTATIONS AND WARRANTIES. Each Assignor hereby
represents and warrants to Assignee as of the date hereof that:
(1) That Assignor is the owner of Participation Interests as
identified on Exhibit A of the Exchange Offer.
(2) That Assignor has all necessary power and authority to enter
into this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby, without the consent or
authorization of, or notice to, any third party, except those third
parties to whom such consents or authorizations have been or will be
obtained, or to whom notices have been or will be given, prior to the
Closing. This Agreement constitutes, and the other documents and
instruments to be delivered by that Assignor pursuant hereto when
delivered will constitute, the legal, valid and binding obligations of
that Assignor, enforceable against that Assignor in accordance with their
respective terms.
(3) There is no litigation, proceeding or action pending or, to the
best of that Assignor's knowledge, threatened against or relating to
that Assignor, the Partnerships or the Xxxxxx Hotels (as such terms are
defined herein) which might materially and adversely affect that Assignor
or which questions the validity of this Agreement or any action taken or
to be taken by that Assignor or any of the Partnerships pursuant hereto.
(4) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or
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constitute a default under any term or provision of any agreement,
instrument or lease to which that Assignor is a party.
(5) Neither that Assignor, nor, to the best of that Assignor's
knowledge any prior owner of the Initial Hotels owned, directly or
indirectly, by the partnerships or limited liability company whose
interests are being assigned hereby (collectively for each Assignor the
"Xxxxxx Hotels") has: (a) caused or permitted the generation,
manufacture, refinement, transportation, treatment, storage, handling,
installation, removal, disposal, transfer, production or processing of
Hazardous Substances (as hereinafter defined) or other dangerous or toxic
substances, or solid wastes, except in strict compliance with all laws:
(b) caused or permitted or received any written notice or have any actual
knowledge of the Release (as hereinafter defined) or existence of any
Hazardous Substances on or about the Xxxxxx Hotels or property
surrounding the Xxxxxx Hotels which might affect the Xxxxxx Hotels; (c)
caused or permitted or received any written notice or have any actual
knowledge of any substances or conditions on or about the Xxxxxx Hotels
or on property surrounding the Xxxxxx Hotels which may support a claim or
cause of action, whether by any governmental authority or any other
person, under any laws ("Environmental Laws") in effect as of the date of
this Agreement and all rules and regulations promulgated thereunder,
including, but not limited to: the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Sections 9601 et seq.
(the "Superfund Act"); the Resource Conservation and Recovery Act of
1976, 42 U.S.C. Sections 6921 et seq.; the Toxic Substances Control Act,
15 U.S.C. Section 2601 et seq.; the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. Section 136; the Federal Water Pollution
Control Act, 33 U.S.C. Sections 1251 et seq.; the Hazardous Materials
Transportation Act, 49 U.S.C. Sections 1801 et seq.; the Federal Solid
Waste Disposal Act, 42 U.S.C. Sections 6901 et seq.; the Clean Air Act,
42 U.S.C. Section 7401 et seq.; or any other Law. For the purposes of
this Agreement the terms "Hazardous Substances" and "Release" shall have
the definitions used in the Superfund Act; provided, however, that the
definition of the term "Hazardous Substances" shall also include (if not
included within the definition contained in the Superfund Act), petroleum
and related by-products, hydrocarbons, radon, asbestos, urea formaldehyde
and polychlorinated biphenyl compounds ("PCB's").
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(6) The Partnerships, the Xxxxxx Hotels, and the conduct by the
Partnerships of their business relating thereto are in compliance in all
material respects with all applicable laws, ordinances and regulations of
proper public authorities, and neither that Assignor nor the Partnerships
has written notice or actual knowledge of any material violation, whether
actual, claimed or alleged, thereof.
(7) At Closing, that Assignor will own good, valid and marketable
title to his or its Participation Interests, free and clear of all
mortgages, pledges, liens, security interests, encumbrances and
restrictions of any nature whatsoever.
(8) All federal, state and other taxes, assessments, fees and other
governmental charges upon the Partnerships with respect to the Xxxxxx
Hotels and their properties or the business conducted thereon which are
due and payable have been paid. The Partnerships have filed all tax
returns required to be filed, and none of the Partnerships are in default
in the payment of any taxes which were payable pursuant to said returns or
any assessments with respect thereto.
(9) To the best of that Assignor's knowledge, with respect to all
licenses, permits, consents, authorizations, approvals and certificates of
any regulatory, administrative or other governmental agency or body, if
any, issued to or held by the Partnerships and related to the ownership or
operation of the Xxxxxx Hotels (collectively, the "Permits"), (i) each of
the Permits is currently valid and in full force and effect, and (ii) the
Permits constitute all licenses, permits, consents, authorizations,
approvals and certificates of any regulatory, administrative or other
governmental agency or body necessary to the Partnerships' ownership or
operation of the Xxxxxx Hotels. The Partnerships are not in violation in
any material respect of any of the Permits and there is no pending or, to
the actual knowledge of Assignor, threatened proceeding which could result
in the revocation or cancellation of, or inability of the Partnerships to
renew, any Permit.
(10) Each Partnership has been duly organized and is validly
existing as a limited or general partnership or limited liability company,
as the case may be, in its appropriate jurisdiction with the power and
authority to own, lease and operate the respective Xxxxxx Hotel property,
to conduct the business in which it is engaged. The respective partnership
agreement or operating agreement, as the case may be, is in full force and
effect.
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(11) None of the Partnerships is (i) in any violation of its
partnership agreement or operating agreement, as the case may be, or (ii)
in violation of any law, ordinance, administrative or governmental rule or
regulation applicable to it or of any decree or any court or governmental
agency or body having jurisdiction over it (except for any such violation
that would not have a material adverse effect on the Partnership or on the
Xxxxxx Hotel operated by it), or (iii) in any default in the performance
of any obligation, agreement, condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any material agreement,
indenture, lease, mortgage or other material instrument to which it is a
party or by which it or any of its properties may be bound.
(12) Since December 31, 1995, the Partnerships have not incurred any
liability or obligation, not in the ordinary course of business, that is
material to the Partnerships and there has not been any material increase
in the short-term debt or long-term debt, or any material adverse change,
or any development involving or which may reasonably be expected to
involve, a prospective material adverse change, in the condition,
financial or otherwise, business, properties, net worth or results of
operations of the Partnerships.
(13) The Partnerships maintain a system of internal accounting
control sufficient to provide reasonable assurances that (i) transactions
are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; and (iii)
the recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(14) Each of the Xxxxxx Hotels complies in all material respects
with all applicable codes and zoning laws and resolutions, and there is no
pending or, to the best of that Assignor's knowledge, threatened,
condemnation, zoning change, or other proceeding of action that will
in any manner materially affect the size of, use of, improvements on,
construction on, or access to the Xxxxxx Hotels. The improvements
comprising any portion of each Xxxxxx Hotel's properties (the
"Improvements") are free of any and all material physical, mechanical,
structural, design and construction defects which would, singly or in the
aggregate, have a material adverse effect
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on such individual Xxxxxx Hotel's property and the mechanical, electrical
and utility systems servicing the Improvements (including, without
limitation, all water, electric, sewer, plumbing, heating, ventilation,
gas, and air conditioning) are in good condition and proper working order
and are free of defects (for which provision to repair has not been made)
which would, singly or in the aggregate, have a material adverse effect on
such Xxxxxx Hotel's property.
(15) The franchise agreements with respect to each of the Xxxxxx
Hotels are in full force and effect, and none of the Partnerships have
received any notice of default, or have knowledge of any event that with
notice or lapse of time, or both, would constitute a default, under any
such franchise agreement.
(16) To the best of that Assignor's knowledge each of the Exchange
Offer and the Other Partner Exchange Offers as of its date and at the
Closing Date, and any amendment thereof or supplement thereto, as of
their respective dates, did not and will not, as of such dates, include
any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. Each Assignor
also makes the further representation that nothing in this Agreement
shall operate to release Assignor from any liabilities or obligations for
which that Assignor would otherwise be responsible arising out of or in
connection with the ownership of the Participation Interests or the
Xxxxxx Hotels relating to any periods prior to the Closing.
(17) The Xxxxxx Group, Inc. ("TBG") is and on the Closing Date will
be owned by Xxxxxx X. Xxxxxx and Xxxx X. Xxxxxx.
All of the representations and warranties set forth in this Section D
shall be deemed renewed by each Assignor on the Closing Date as if made at
such time.
E. REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee represents and
warrants to each Assignor that:
(1) Assignee is, and will be at the Closing, a limited partnership
duly organized, validly existing and in good standing under the laws of
the State of Ohio and is, or at Closing will be, registered as a foreign
limited partnership in each jurisdiction in which it is engaging in
business or
B-7
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expects to do so. Assignee has, and at the Closing will have, the power
and authority to carry on the business for which it has been organized.
The persons executing this Agreement on behalf of Assignee are duly
authorized to do so, and all requisite action has been taken by Assignee
to authorize the execution and delivery of this Agreement, the performance
by Assignee of its obligations hereunder and the consummation of the
transactions contemplated hereby.
(2) To the best of Assignee's knowledge, there is no litigation,
proceeding or action pending or threatened against or related to Assignee
which might materially and adversely affect Assignee or which questions
the validity of this Agreement or any action taken or to be taken by
Assignee pursuant hereto.
(3) Assignee has all necessary power and authority to enter into
this Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby, without the consent or authorization of,
or notice to, any third party, except those third parties to whom such
consents or authorizations have been or will be obtained, or to whom
notices have been or will be given, prior to the Closing. This Agreement
constitutes, and the other documents and instruments to be delivered by
Assignee pursuant hereto when delivered will constitute, the legal, valid
and binding obligations of Assignee, enforceable against Assignee in
accordance with their respective terms.
(4) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby will, in any material respect,
constitute a violation of or be in conflict with or constitute a default
under any term or provision of any agreement, instrument or lease to which
Assignee is a party.
All of the representations and warranties set forth in this Section E
shall be deemed renewed by Assignee on the Closing Date as if made at such time
and shall survive the closing of the transactions contemplated hereby for a
period of six months.
F. DELIVERIES; CONDITIONS. Assignee shall issue or deliver the
following to or for the benefit of each Assignor on or prior to the Closing
Date:
(1) the consideration for the Participation Interests;
B-8
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(2) duly executed resolutions adopted by Assignee authorizing the
execution and delivery of this Agreement by Assignee, the performance by
Assignee of its obligations hereunder and the consummation of the
transactions contemplated hereby;
(3) the releases required pursuant to Section I hereof;
G. CLOSING DATE. Unless the parties otherwise agree in writing, the
transactions contemplated hereby shall be closed (the "Closing") simultaneously
with the completion of the IPO, provided such offering occurs on or before
December 31, 1996 (the date of the closing of the IPO, the "Closing Date"). If
the Closing has not occurred by on or before December 31, 1996, any party,
provided such party is not in default under this Agreement, shall have the
right to terminate this Agreement as it relates to that party by giving notice
to the other parties, in which event all documents and instruments which may
have been delivered by any party to the terminating party shall be returned,
and neither the terminating party nor any other party hereto, in relation to
the terminating party, shall thereafter by under any further liability to the
other party hereto.
H. CERTAIN EXPENSES AND CHARGES. Assignee shall pay to each Assignor the
Purchase Price payable to that Assignor at Closing.
I. TBG shall make, jointly and severally with the Assignee and the
Company, the representations and warranties to be made by Assignee and the
Company in the Underwriting Agreement to be executed in connection with the IPO
(the "Underwriting Agreement"). Until Assignor's obligations under this
Agreement and TBG's obligations under this Agreement and the Underwriting
Agreement expire or otherwise terminate any of the assets of TBG reflected on
Schedule II may be distributed only subject to this Agreement, and the
recipient thereof shall receive and hold those assets subject to TBG's
obligations hereunder and under the Underwriting Agreement. TBG will furnish to
Assignee or the underwriters of the IPO upon request, on the Closing Date, a
balance sheet prepared in accordance with Generally Accepted Accounting
Principles (subject to adjustment to reflect the fair market value of the Units
to be held by TBG on that date), which shall be revised and dated as of the
Closing Date and substantiallly in the form attached hereto as Schedule II (the
"Balance Sheet").
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J. RELEASES; INDEMNIFICATION.
(1) Assignee shall use reasonable efforts (at no more than a nominal
cost to Assignee) to attempt to obtain releases of each Assignor from any
lenders of the Partnerships in respect to any and all personal liability
of that Assignor to such lenders accruing from and after the Closing Date
(in form and substance acceptable to that Assignor in his reasonable
discretion) and to the extent such releases are not obtained, hereby
agrees to assume and indemnify that Assignor, from any and all personal
liability to any lenders of the Partnerships that accrues from and after
the Closing Date.
(2) Assignee shall fully indemnify and hold each Assignor and that
Assignor's trustee, heirs, representatives, successors and assigns
harmless from and against any and all claims, demands, losses,
liabilities, damages and expenses (including reasonable attorneys' fees)
arising out of or in connection with (i) the failure of Assignee to
perform in any material respect any of its obligations hereunder, (ii)
the inaccuracy of any representation or warranty made by Assignee
hereunder (except to the extent that such indemnification obligation
would arise directly as a result of the inaccuracy of any representation,
warranty or covenant made by Assignor hereunder), and (iii) the
activities, operations and ownership of the Partnerships and their
respective properties (including the Xxxxxx Hotels) conducted or
arising in respect of conditions or circumstances occurring from and
after the Closing (except with respect to any such activity, operation or
ownership, to the extent that Assignor is obligated to indemnify the
Assignee under this Agreement or any other document or agreement).
(3) TBG agrees to fully indemnify Assignee and hold Assignee, its
officers, directors and general partners and their respective
representatives, successors and assigns harmless from and against any and
all claims, demands, losses, liabilities, damages and expenses (including
reasonable attorneys' fees) arising out of or in connection with (i) the
failure of TBG to perform in any material respect any of its obligations
hereunder, (ii) the inaccuracy of any representation or warranty made by
any Assignor hereunder (other than any representation or warranty made in
Xxxxxxx X.0, X.0, X.0 xx X.0 hereof, and except to the extent that such
indemnification obligation would arise directly as a result of the
inaccuracy of any representation, warranty or covenant made by Assignee
hereunder), or (iii) the assets, liabilities (except to the extent of the
indebtedness of the Partnerships to be paid in connection with the
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113
Offering, as described in the Registration Statement) or the activity of
the Contributed Partnerships and the operation and ownerships of the
Xxxxxx Hotels and their properties prior to the Closing, or (iv) the
inaccuracy of any representation or warranty made by the Assignee, the
Company or TBG, or by any combination thereof, in the Underwriting
Agreement. Each Assignor and TBG agree jointly and severally to fully
indemnify Assignee and hold Assignee, its officers, directors and
general partners and their respective representatives, successors and
assigns harmless from and against any and all claims, demands, losses,
damages and expenses (including reasonable attorneys' fees) arising out
of or in connection with (i) the failure of that Assignor to perform in
any in any material respect any of its obligations hereunder, or (ii) the
inaccuracy of any representation of warranty made by that Assignor in
Xxxxxxx X.0, X.0, X.0 xx X.0 hereof (except to the extent that such
indemnification obligation would arise directly as a result of the
inaccuracy of any representation, warranty or covenant made by Assignee
hereunder).
K. CONSENTS. Assignee has entered into or will enter into an agreement to
purchase other Participation Interests in the Partnerships and each Assignor
hereby consents to each and every transaction contemplated by this Agreement.
Each Assignor hereby consents to (i) the transfer by any partner or member of
their interests in the entities covered by this Agreement to Assignee or
Assignee's nominee, (ii) the transfer by any entity listed on Exhibit A of the
Exchange Offer in connection with the transactions contemplated by this
Agreement, of all or substantially all the assets of such entity, including,
without limitation, the liquor licenses and franchise agreements, to Assignee
or Assignee's nominee and (iii) a waiver of any rights of first refusal,
options or other rights which could be asserted by that Assignor in connection
with any agreements regarding the transfer of the Participation Interests to
Assignee or related to the ownership or operation of the Xxxxxx Hotel
properties. Each Assignor also consents, as the case may be, to the
substitution of Assignee as a partner or member in any of the Partnerships and
the liquidation or termination of the Partnerships (including BBG, I, L.L.C., a
Georgia limited liability company) upon completion of the transfer referenced
above. Each Assignor agrees to execute any documents and instruments, and shall
take or cause to be taken such further action, as may be necessary at any time
or from time to time in order to effectuate that Assignor's consent referenced
herein.
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In the event the Closing does not occur as provided in Section G, the
various consents referenced above shall be automatically deemed revoked by
each Assignor and each Assignor and Assignee agree to execute any documents and
instruments necessary in order to effect said revocation and to place that
Assignor in the same position as if this Agreement had not been executed by
that Assignor.
L. ASSIGNMENT. Assignee has the right, upon five (5) days' written notice
to Assignors, to assign and transfer its interest in this Agreement to an entity
that is taxable as a partnership and that is controlled by Assignee or the
Xxxxxx Family, on or prior to the Closing Date. In such event, provided that any
such transferee agrees in writing to assume all of Assignee's obligations
hereunder, Assignee shall be released from any and all liability hereunder as of
the effective date of such assignment.
M. Until each Assignor's obligations under this Agreement and TBG's
obligations under this Agreement and the Underwriting Agreement expire or
otherwise terminate, any of the assets of TBG reflected on Schedule II may only
be distributed subject to this Agreement and the recipient thereof shall
receive and hold those assets subject to TBG's obligations hereunder and under
the Underwriting Agreement. TBG will furnish to Assignee or the underwriters of
the IPO upon request, on or prior to the Closing Date, a Balance Sheet
prepared in accordance with Generally Accepted Accounting Principles (the
"Balance Sheet").
N. ASSIGNMENT AND ASSUMPTION OF PARTICIPATION INTERESTS. Subject to the
terms and conditions herein as of the Closing Date:
(1) Each Assignor does hereby sell, convey and assign to Assignee
the Participation Interests, and any interest in and to any certificate of
limited partnership, partnership agreement, articles of organization or
operating agreement, as the case may be, forming any of the Partnerships,
as each may have been amended from time to time.
(2) Assignee hereby agrees to assume, discharge and release each
Assignor as a general or limited partner or member, as the case may be,
in the Partnerships to the extent of the interest hereby assigned
from, and agrees to indemnify that Assignor against all obligations which
may accrue from and after the Closing Date by virtue of the Partnerships
or any certificate of limited partnerships, partnership agreement,
articles of organization, or operating agreement, as the case may be,
applicable to the interests hereby assigned and does further agree to be
bound by all the terms, conditions and
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provision of and certificates of limited partnership, partnership
agreements, articles of organization or operating agreement, as the case
may be, and to be a partner or member, as the case may be, of the
Partnerships.
O. MISCELLANEOUS.
(1) This Agreement, together with the Exchange Offer and together
with the exhibits thereto shall be deemed to contain all of the terms and
conditions agreed upon with respect to the subject matter hereof, it being
understood that there are no outside representations or oral agreements.
(2) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, permitted assigns,
heirs and personal representatives.
(3) The parties shall execute and deliver such further documents and
instruments of conveyance, sale, assignment, transfer or otherwise, and
shall take or cause to be taken such other or further action as either
party shall reasonably request at any time or from time to time in order
to effectuate the terms and provisions of this Agreement.
(4) This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio.
(5) This Agreement will survive the Closing and the delivery of the
documents contemplated herein.
(6) In the event of a default by either party to this Agreement, the
non-defaulting party shall have all rights available at law or in equity.
In the event the non-defaulting party prevails in any litigation related
to this Agreement, the defaulting party shall be obligated to reimburse
the non-defaulting party all of its reasonable costs and expenses related
to such litigation (including reasonable attorneys' fees).
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IN WITNESS WHEREOF, the parties hereto have signed three
counterparts of this Agreement, each of which shall be deemed to be an original
document, as of the date set forth above.
ASSIGNOR:
/s/ Xxxxxx X. Xxxxxx
-------------------------------
Xxxxx X. Xxxxxx
/s/ Xxxx X. Xxxxxx
-------------------------------
Xxxx X. Xxxxxx
THE XXXXXX GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
XXXXXX ENTERPRISES, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
XXXXXX RESORTS, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
XXXXXX BERKELEY, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
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000
XXXXXX XXXXXXXX ONE, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
XXXXXX MANAGEMENT COMPANY
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
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ASSIGNEE:
XXXXXX HOTEL PROPERTIES, L.P., an Ohio limited partnership
By: Xxxxxx Lodging Trust, Inc.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
THE XXXXXX GROUP, Inc., an Ohio corporation
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
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Schedule I
OTHER PARTNER DATE OF CONTRIBUTION (ASSIGNMENT) PARTICIPATION INTEREST
------------- OR PURCHASE AGREEMENT ----------------------
---------------------
1. Xxxxxx X. Xxxxxxx March 22, 1996 .857% Xxxxxx Amherst Joint Venture ("BAJV")
.829% Xxxxxx Columbus Joint Venture ("BCJV")
2. Xxxxx Xxxxxx .857% BAJV
.829% BCJV
3. Xxxxxx X. Ceiless 3.429% BAJV
3.315% BCJV
4. Xxxxxx X. Xxxxxxxx 2.571% BAJV
2.486% BCJV
5. Xxxxxx X. X'Xxxxx March 21, 1996 1.143% BAJV
1.105% BCJV
6. Xxxxxx X. Xxxxxx .857% BAJV
.829% BCJV
7. Xxxx X. Xxxxxxx March 18, 1996 .857% BAJV
.829% BCJV
8. Xxxxxxx X. Xxxxx April 14, 1996 .857% BAJV
.829% BCJV
9. Xxxxxx X. Xxxxxxx .857% BAJV
2.486% BCJV
10. Xxxxxxx X. Xxxxxxxx June 17, 1996 4.286% BAJV
4.143% BCJV
11. Xxxx X. X'Xxxx June 17, 1996 .571% BAJV
.552% BCJV
12. Xxxxxxx X. Xxxxxx Trusts May 22, 1996 35% Beachwood Hotel Joint Venture ("Beachwood")
59.716% BAJV
59.393% BCJV
13. Xxxxxx X. Xxxx May 24, 1996 4.286% BAJV
4.143% BCJV
14. Xxxxxxx Xxxx June 12, 1996 29.7% BBG,I.L.L.L.C. ("BBG")
15. Xxxxxx X. Xxxxxxxxx June 12, 1996 24.3% BBG
120
16. Xxxxxxx X. Xxxxxx Trust June 18, 1996 27.85% Buffalo Hotel Joint Venture ("Buffalo")
27.7% Columbus Hotel Joint Venture ("Columbus")
32.3375% Beachwood
17. Xxxxx X. Xxxxxx Trust Jume 18, 1996 15.9% Buffalo
15.8% Columbus
25.194% Beachwood
18. Visconsi Trust June 18, 1996 .975% Beachwood
19. Pawlisch Trust June 18, 1996 1% Buffalo
1% Columbus
1.001% Beachwood
20. Xxxxxxx Trust June 18, 1996 1% Buffalo
1% Columbus
1.001% Beachwood
21. Crane Trust June 18, 1996 2% Buffalo
2% Columbus
2.002% Beachwood
22. Coffin Trust June 18, 1996 2% Buffalo
2% Columbus
2.002% Beachwood
23. M & P Partners June 18, 1996 .25% Buffalo
(Xxxxxx) .5% Columbus
.4875% Beachwood
121
Schedule II
Pro-forma 3/31/96
The Xxxxxx Group Inc.
Assets And Liabilities
(000's)
Assets
------
Cash and Marketable Securities $ 1,165
Life Insurance (net) 181
Affiliate Advances 103
Pro-forma Distribution-BMC 1,316
Investments in BMCL (book value) 3,000
Units
(at Face Market Value) in OP 808,000 x $22 17,776
-------
Total Assets $23,541
=======
Liabilities
-----------
Income Taxes Payable (est.) $ 1,000
Defended Compensation 381
-------
Total Liabilities $ 1,381
Net Worth $22,160
-------
Total Liabilities and Net Worth $23,541
=======
I hereby certify that the above is a reasonable estimate of the pro
forma financial condition of The Xxxxxx Group, Inc. as of March 31, 1996,
assuming an IPO price of $22 per share and adjusting to fair market value the
value of the Units to be held by TBG. I confirm my expectation that assuming an
IPO price of $22 per share, the Assets, Liabilities and Net Worth of The Xxxxxx
Group, Inc. will be approximately as shown above at the Closing.
/s/ Xxxx X. X'Xxxx
-------------------------------
Xxxx X. X'Xxxx
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EXHIBIT A
Confidential Offering Memorandum
================================================================================
VALUATION FORMULA
-----------------
PART I
PARTICIPATING PARTNER
---------------------
OFFEREE AND LISTING OF PARTNERSHIP INTERESTS:
1) XXXXXX X. XXXXXX ("RWB"):
a. 9.116% general partnership interest in Xxxxxx Columbus Joint
Venture ("BCJV"), an Ohio general partnership;
b. The amount owed by BCJV to RWB (if any) at Closing pursuant to
an advance made by RWB on or about November 2, 1991 in the
original principal amount of approximately $13,750 (the
"Partner Loan");
c. 9.428% general partner interest in Xxxxxx Amherst Joint
Venture ("BAJV"), an Ohio general partnership;
d. 60% general partner interest in Fort Xxxxx Hotel Partnership
("FMHP"), an Ohio general partnership; and
e. 53.85% membership interest in Boycorn, Ltd. ("Boycorn"), an
Ohio limited liability Company.
2) XXXX X. XXXXXX ("XXX"):
a. 9.116% general partner interest in BCJV;
b. The amount owed by BCJV to XXX (if any) at Closing pursuant to
an advance made by XXX on or about November 2, 1991 in the
original principal amount of approximately $13,750 (the
"Partner Loan");
c. 9.428% general partner interest in BAJV;
d. 40% general partner interest in FMHP; and
e. 46.15% membership interest in Boycorn.
3) THE XXXXXX GROUP, INC. ("TBG"):
a. 1% general partner interest in Melbourne Oceanfront Hotel
Associates ("MOHA"), an Ohio general partnership; and
b. 1% general partner interest in Pacific Ohio Partners ("POP"),
a California general partnership.
4) XXXXXX ENTERPRISES, INC. ("BEI"): 99% general partner interest POP.
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5) XXXXXX RESORTS, INC. ("BRI"): 99% general partner interest MOHA.
6) XXXXXX BERKELEY, INC. ("BBI"): 96% general partner interest in
Berkeley Marina Associates L.P. ("BMALP"), a Delaware limited
partnership.
7) XXXXXX BERKELEY ONE, INC. ("BBOI"): 4% limited partner interest in
BMALP.
8) XXXXXX MANAGEMENT COMPANY ("BMC"): the note represented by the BMC
Preference Amount.
________________________________________________________________________________
PART II
A. The Purchase Price for the Xxxxxx Interests of the Offeree shall be
calculated in the following manner:
(1) Definitions:
(a) "Value of the REIT Shares" shall mean the total value
of the REIT Shares issued by the REIT and partnership
interest ("Units") issued by the Operating
Partnership at the time of the REIT Offering computed
by multiplying the number of REIT Shares and Units to
be issued times the midpoint dollar amount specified
in the preliminary prospectus (and any amendments
thereto) to be filed by the REIT with the Securities
and Exchange Commission (the "SEC")(the "Preliminary
Prospectus"). In computing the number of Units to be
issued, any convertible debt of the Operating
Partnership shall be considered converted;
(b) "Gross Purchase Price" shall be the product of the
Value of the REIT Shares times the Hotel Share;
(c) The "Hotel Share" shall be a fraction computed by
dividing the Net Operating Income ("NOI") of the
Hotel by the total NOI of all hotels to be included
in the REIT offering, based upon the Preliminary
Prospectus;
(d) "Hotel" shall be the hotel corresponding to the
Offeree in the listing of Offeree's Effective
Ownership in (1) below.
(e) In each case, NOI shall be computed as follows:
Start with the net income for the most recent twelve
(12) month period as disclosed in the financial
statements contained in the Preliminary Prospectus,
Add:
1. Depreciation and amortization;
2. Interest expense;
3. Extraordinary or Unusual losses not
affecting the pro forma net income
of the Lessee;
4. Other nonoperating expenses or
losses (such as any loss on disposal
of fixed assets) not affecting the
pro forma net income of the Lessee;
5. Pro forma adjustments made in the
Preliminary Prospectus, to the
extent that they increase the pro
forma net income of the Lessee or
the REIT, for instance, any
adjustment increasing departmental
profits, or decreasing real estate
taxes, franchise fees expense or
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other item which increases the pro
forma net income of the Lessee; and
6. The excess (if any) a management fee
expense of 2.5% of revenues over the
actual management fee expense.
Subtract:
1. Interest income;
2. Extraordinary gains or income not
affecting the pro forma net income
of the Lessee;
3. Other nonoperating income or gains
(such as any gain on disposal of
fixed assets) not affecting the pro
forma net income of the Lessee;
4. Pro forma adjustments made in the
Preliminary Prospectus, to the
extent that they decrease the pro
forma net income of the Lessee or
the REIT, for instance, real estate
taxes, franchise fees expense or
other item which decrease the pro
forma net income of the REIT or the
Lessee;
5. A reserve for replacements of
furniture, fixtures and equipment
equal to four percent (4%) of the
total revenues disclosed in the
Preliminary Prospectus; and
6. The excess (if any) of actual
management fee expense over a
management fee expense of 2.5% of
revenues.
(f) "Hotel Costs" shall mean the sum of the amounts
referenced below, as reflected in the Preliminary
Prospectus under the use of proceeds:
1. costs directly related to the Hotel
including, without limitation, the
following: third party mortgage
debts, notes payable to franchisor,
transfer costs, accounting and
audit, due diligence costs, such as
title commitment and title
insurance, environmental,
engineering, renovation of the
Properties, agreed upon by the
Offeree and the Operating
Partnership and, if applicable, the
Franchisor and which may include
property upgrades as required by the
Franchisor including any Property
Improvement Plans ("PIP") or
otherwise, appraisals, conveyance
or transfer taxes any and all sales
taxes payable in connection
marketing fees or any other costs
specifically attributable to the
Properties, cash payments to
purchase the Other Partners
interests, cash payments to retire
partner loans payable to the Other
Partners, and all other costs
incurred in connection with the
Closing of this transaction as are
customary in the local of each
hotel; PLUS
2. (i) costs unallocated to a specific
property attributable to the REIT
Offering excluding underwriters
fees, but including without
limitation, working capital,
registration cost, legal and
accounting fees, printing expenses,
marketing and travel expenses
multiplied by the (ii) Hotel Share;
PLUS
3. An allocable portion of the
underwriters fees computed by
multiplying (i) 7.5269% by (ii) the
sum of the Hotel costs referred to
in 1 and 2 aforesaid; and PLUS
4. The Purchase Price for the Other
Partners who receive Units in
exchange for the interests, and in
the case of the Lake Xxxxxx Hotel
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(Lake Xxxxxx Xxxxxxx Inn and Lake
Xxxxxx Holiday Inn) the BMC
Preference Amount.
(g) "Purchase Price" shall mean, the sum for each Hotel
corresponding to the Offeree's Effective Ownership,
the Hotel the Gross Purchase Price less Hotel Costs,
with the result multiplied by Offeree's Effective
Ownership.
(h) "Other Partners" shall mean any partner or member in
one of the Contributed Partnerships, other than
Xxxxxx X. Xxxxxx, Xxxx X. Xxxxxx, or entities owned
100% by either one or both of them. Other Partners
shall include the Xxxxxxx X. Xxxxxx Trusts No. 1, 2
and 3.
(i) "Loans Payable to the Other Partners" shall include
any loans payable at closing to the Other Partners
and also that certain note payable by Xxxxxx Columbus
Joint Venture to Xxxxxx Management Company, the
principal and interest of which at December 31, 1995
totaled approximately $2,866,687, which sum shall
increase until closing at the annual rate of ten
percent (10%).
(j) "BMC Preference Amount" shall mean that amount of
principal and interest which was owing on that
certain loan from Xxxxxx Management Company to
Boycorn, Ltd., dated March 31, 1996 in the original
principal amount of $375,000.00, which loan is to be
hereby exchanged for Units.
(k) "Xxxxxx Interests" shall mean the ownership interests
in the Contributed Partnerships listed for each
Offeree in Part I above.
(l) "Offeree's Effective Ownership" shall be the
following effective ownership percentages,
representing the remaining ownership after the Other
Partners are subtracted:
Hotel Contributed Partnerships Partner/Offeree Effective Ownership
----- ------------------------ --------------- -------------------
Buffalo Marriott BAJV RWB 50%
Buffalo Marriott BAJV XXX 50%
Columbus Marriott BCJV RWB 50%
Columbus Marriott BCJV XXX 50%
Cleveland Airport
Marriott POP BEI 99%
Cleveland Airport
Marriott POP TBG 1%
Berkeley Marina
Marriott BMALP BBI 96%
Berkeley Marina
Marriott BMALP BBOI 4%
Radisson Inn
Sanibel Gateway FMHP RWB 60%
Radisson Inn
Sanibel Gateway FMHP XXX 40%
Melbourne Quality
Suites MOHA BRI 99%
Melbourne Quality
Suites MOHA TBG 1%
Lake Xxxxxx
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Holiday Inn Boycorn RWB 53.85%
Lake Xxxxxx
Holiday Inn Boycorn XXX 46.15%
Lake Xxxxxx
Xxxxxxx Inn Boycorn RWB 53.85%
Lake Xxxxxx
Xxxxxxx Inn Boycorn XXX 46.15%
In the case of BMC, Offeree's Effective Ownership shall be a fixed
amount equal to the BMC Preference Amount.
B. The Purchase Price for each of the Hotels corresponding to the
Offeree's Effective Ownership shall be paid in the form of
Units. The number of Units to be received shall equal the
Purchase Price divided by the midpoint of price per share
disclosed in the Preliminary Prospectus. Any rounding of the
number of Units shall increase of decrease Units of BMC. In
no case shall the allocation of the Purchase Price to a Xxxxxx
Interest be less than $10,000, and reallocation shall be made
away from other interests of the Offeree in that case.
If there is any change in the price per share or total Shares
and Units disclosed in the Preliminary Prospectus,
proportionate adjustments will be made to the number of Units
to be received by the Assignors.
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PARTNERSHIP INTEREST AND PARTNER LOAN
PURCHASE AGREEMENT
------------------
THIS PURCHASE AGREEMENT (this "Agreement"), made as of
the 19th day of June, 1996, by and between XXXXXX X. XXXXXXX, XX. an individual
("Seller"), and XXXXXX HOTEL PROPERTIES, L.P., an Ohio limited partnership, or
its nominee(s) ("Buyer"),
W I T N E S S E T H:
--------------------
WHEREAS, Seller owns a general partnership interest
(collectively the "Partnership Interests") of 0.857% in Xxxxxx Amherst Joint
Venture and 2.486% in Xxxxxx Columbus Joint Venture (collectively the
"Partnerships") pursuant to those certain agreements referred to as the First
Amended and Restated Xxxxxx Amherst Joint Venture and the Xxxxxx Columbus Joint
Venture (collectively, the "Partnership Agreements");
WHEREAS, the Partnerships have an ownership interest in the
Buffalo Marriott Hotel and Columbus North Marriott Hotel, respectively,
(collectively the "Properties"); and
WHEREAS, Xxxxxx Columbus Joint Venture owes Seller a certain
sum pursuant to an advance made by Seller on or about November 2, 1991, in the
original principal amount of three thousand seven hundred fifty dollars
($3,750.00) (the "Partner Loan");
WHEREAS, Buyer desires to purchase from Seller, and Seller
desires to sell the Partnership Interests and the Partner Loan to Buyer, on the
other terms and subject to the conditions hereinafter stated;
NOW, THEREFORE, for good and valuable consideration received
to the full satisfaction of each of them, the parties agree as follows:
1. PURCHASE AND SALE OF PARTNERSHIP INTERESTS AND PARTNER
LOAN. Upon the terms and subject to the conditions set forth herein, Seller
agrees to convey, sell, transfer, assign and deliver to Buyer at the Closing (as
hereinafter defined), and Buyer agrees to buy and take from Seller at the
Closing, all of Seller's right, title, estate and interest in and to the
Partnership Interests and the Partner Loan, free and clear of all liens,
security interests and encumbrances whatsoever, except those imposed by the
terms of the Partnership Agreements.
2. CONSIDERATION AND PAYMENT. The purchase price for the
Partnership Interests and the Partner Loan shall be one hundred fifty seven
thousand three hundred seventy dollars ($157,370.00) less the sum of (i)
payments made to Seller on the Partner Loan (if any) from January 1, 1996
through Closing, and (ii) cash distributions to Seller from the Partnerships (if
any) from January 1, 1996 through Closing (the "Purchase Price").
128
The Purchase Price shall be paid in cash by Buyer to Seller at Closing. The
payment of the Purchase Price is conditional upon the completion of the offering
to the public of common shares of stock (the "IPO") by the general partner of
Buyer and the completion of the deliveries set forth in Section 5. However, at
Buyer's election only, if the IPO is not completed as provided herein, Buyer may
notify Seller of Buyer's election to still close this transaction (on the same
terms and conditions referenced herein), provided such closing occurs by the
Closing Date provided in Section 6.
In the event of the completion of the IPO as described aforesaid, the Buyer
shall be obligated, subject to completion of the deliveries set forth in Section
5, to acquire the Partnership Interests from Seller and pay the Purchase Price
to Seller.
3. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller hereby represents and
warrants to Buyer as of the date hereof that:
(a) Seller has all necessary power and authority to enter into
this Agreement, to perform his obligations hereunder and to consummate
the transactions contemplated hereby, without the consent or
authorization of, or notice to, any third party, except as may be
required by the Partnership Agreement and except further, for those
third parties from whom such consents or authorizations have been or
will be obtained, or to whom notices have been or will be given, prior
to the Closing. This Agreement constitutes, and the other documents and
instruments to be delivered by Seller pursuant hereto when delivered
will constitute, the legal, valid and binding obligations of Seller.
(b) To the best of Seller's knowledge, there is no litigation,
proceeding or action pending or threatened against or relating to
Seller which questions the validity of this Agreement or any action
taken or to be taken by Seller pursuant hereto.
(c) Neither the execution of this Agreement nor the
consummation of the transactions contemplated hereby will, in any
material respect, constitute a violation of or be in conflict with or
constitute a default under any term or provision of any agreement,
instrument or lease to which Seller is party.
(d) Seller owns the Partnership Interests and the Partner
Loan, free and clear of all mortgages, pledges, liens, security
interests, encumbrances and restrictions of any nature whatsoever,
except those imposed by the terms of the Partnership Agreements.
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Each of the foregoing representations and warranties is qualified to the
extent that any provision of the Partnership Agreements would make that
representation or warranty untrue and each such representation and warranty is
subject to any exceptions that may arise from the effect of any such provision.
All of the representations and warranties set forth in this Section 3 shall
be deemed renewed by Seller on the Closing Date as if made at such time and
shall survive the Closing contemplated hereby for a period of six months.
4. BUYER'S REPRESENTATIONS AND WARRANTIES. Buyer hereby represents and
warrants to Seller as of the date hereof that:
(a) Buyer is, and will be at the Closing, a limited partnership duly
organized, validly existing and in good standing under the laws of the
State of Ohio and is, or at Closing will be, registered as a foreign
limited partnership in each jurisdiction in which it is engaging in
business or expects to do so and in which such registration is necessary.
(b) Buyer has, and at the Closing will have, the power and authority
to carry on the business for which it has been organized.
(c) The persons executing this Agreement on behalf of Buyer are duly
authorized to do so, and all requisite action has been taken by Buyer to
authorize the execution and delivery of this Agreement, the performance by
Buyer of its obligations hereunder and the consummation of the transactions
contemplated hereby.
(d) The general partner of the Buyer is Xxxxxx Lodging Trust, Inc.
(the "Trust") and it is the Trust whose common shares will be offered and
sold in the IPO.
All of the representations and warranties set forth in this Section 4 shall
be deemed renewed by Buyer on the Closing Date as if made at such time and shall
survive the Closing contemplated hereby for a period of six months.
5. DELIVERIES.
(a) Seller shall execute and deliver to Buyer, at or prior to Closing,
a good and sufficient Assignment and Assumption of Partnership Interests
and Partner Loan, in form reasonably acceptable to Buyer, conveying,
selling, transferring, assigning and delivering to Buyer all of his title
to the Partnership Interests and Partner Loan, free and clear of all
mortgages, pledges, liens, security interests, encumbrances and
restrictions, but subject to any
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limitations contained in or arising from the Partnership Agreements (the
"Assignment Agreement") and any other documents reasonably requested
by Buyer not inconsistent with the terms of this Agreement.
(b) Buyer shall issue or deliver the following to or for the benefit
of Seller on or prior to the Closing Date: (i) the Purchase Price; and (ii)
the Assignment Agreement.
6. CLOSING DATE. Unless the parties otherwise agree in writing, the
transactions contemplated hereby shall be closed (the "Closing") simultaneously
with the completion of the IPO, provided such offering occurs on or before
December 31, 1996 (the "Closing Date"). Seller acknowledges that Buyer may at
any time elect not to purchase the Partnership Interests and Partner Loan if
Buyer and its affiliates do not proceed with the IPO. However, as specified in
Section 2, if the IPO is not completed as provided herein, Buyer may notify
Seller of Buyer's election to still close this transaction (on the same terms
and conditions referenced herein), provided such closing occurs by the Closing
Date aforesaid. If the Closing has not occurred on or before December 31, 1996,
either party, provided such party is not in default under this Agreement, shall
have the right to terminate this Agreement by giving notice to the other party,
in which event all documents and instruments which may have been delivered by
one party to the other party shall be returned, and on any such termination or
election not to purchase, neither party hereto shall thereafter be under any
further liability to the other party hereto.
7. INDEMNIFICATION.
(a) Buyer shall fully indemnify and hold Seller and Seller's heirs,
representatives, successors and assigns harmless from and against any and
all claims, demands, losses, liabilities, damages and expenses (including
reasonable attorneys' fees) arising out of or in connection with (i) the
failure of Buyer to perform in any material respect any of its obligations
hereunder, or (ii) arising out of the activity of the Partnerships and/or
the operation of the Properties from and after the Closing (except to the
extent that such indemnification obligation would arise directly as a
result of the inaccuracy of any representation, warranty or covenant made
by Seller hereunder).
(b) Seller shall fully indemnify Buyer and hold Buyer, its officers
and directors and their respective representatives, successors and assigns
harmless from and against any and all claims, demands, losses, liabilities,
damages and expenses (including reasonable attorneys' fees) arising out of
or in connection with (i) the failure of Seller to perform in any material
respect any of its
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obligations hereunder and (ii) the inaccuracy of any representation or
warranty made by Seller hereunder.
(c) Buyer shall obtain releases for Seller from the Partnerships (in
the form and substance reasonably acceptable to Seller) from any
Partnership obligations and liabilities (other than those related to
Seller's taxes which may accrue as a result of this transaction) which
arise as a consequence of this transaction, unless such obligation or
liability is due to the negligence or willful conduct of Seller.
8. CONSENTS. Buyer has entered into or will enter into agreements to
purchase general partnership interests from other partners of the Partnerships.
Seller hereby consents to (i) the transfer by any general partner of the
Partnerships of such general partner's general partnership interest(s) to Buyer
or Buyer's nominee, (ii) the transfer by the Partnerships to Buyer or Buyer's
nominee of all or substantially all of the assets of the Partnerships
simultaneously with the Closing, including, without limitation, the furniture,
fixtures and equipment owned by the Partnerships, the liquor license and
franchise agreement with Marriott and (iii) effective as of the Closing, a
waiver of any and all other rights which could have been asserted in regard to
the transfer of the Partnership Interests and the Partner Loan. Seller also
consents to the substitution of Buyer as a general partner in the Partnerships
upon the later to occur of the Closing or completion of the transfer referenced
above. Seller agrees to execute any documents and instruments, and shall take or
cause to be taken such further action, as may be necessary at any time or from
time to time in order to effectuate Seller's consent referenced herein.
9. PURCHASE OF THE PROPERTIES. At any time prior to ten (10) days before
the Closing Date, Buyer may elect by written notice to Seller to purchase either
or both of the Properties in lieu of the Partnership Interests. In such event,
Seller shall provide Buyer with such action as Buyer shall reasonably request in
order to convey either or both of the Properties to Buyer. In such event, the
Seller shall receive on the same date as the asset purchase occurs the Purchase
Price as consideration for Seller's percentage interests in the Properties.
10. MISCELLANEOUS.
(a) This Agreement shall be deemed to contain all of the terms and
conditions agreed upon with respect to the subject matter hereof, it being
understood that there are no outside representations or oral agreements.
(b) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective
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successors, permitted assigns, heirs and personal representatives.
(c) The parties shall execute and deliver such further documents and
instruments of conveyance, sale, assignment, transfer or otherwise, and
shall take or cause to be taken such other or further action as either
party shall reasonably request at any time or from time to time in order to
effectuate the terms and provisions of this Agreement. The provisions of
this Section shall survive the Closing.
(d) This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio.
IN WITNESS WHEREOF, the parties hereto have signed three counterparts of
this Agreement, each of which shall be deemed to be an original documents, as of
the date set forth above.
SELLER:
XXXXXX X. XXXXXXX, XX.
WITNESSES:
/s/ Xxxxxx Xxxxxx BY: /s/ Xxxxxx X. Xxxxxxx, Xx.
------------------------- -----------------------------
/s/ ???
-------------------------
BUYER:
WITNESSES: XXXXXX HOTEL PROPERTIES, L.P.
BY: XXXXXX LODGING TRUST,
INC., GENERAL PARTNER
/s/ Xxxxxxx Xxxxxx BY: /s/ Xxxxxx X. Xxxxxx
------------------------- -----------------------------
/s/
------------------------- TITLE:
--------------------------
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