EXECUTION COPY
LETTER AGREEMENT (this "Letter Agreement")
made on this 30th day of July, 1998, by and among
PATRIOT AMERICAN HOSPITALITY, INC., a Delaware
corporation (the "REIT"), WYNDHAM INTERNATIONAL,
INC., a Delaware corporation (the "OPCO", and
together with the REIT, jointly and severally, the
"Companies" and each a "Company"), and PAINEWEBBER
FINANCIAL PRODUCTS INC. ("PaineWebber").
The purpose of this Letter Agreement is to confirm the
satisfaction of certain obligations under the Purchase Price Adjustment
Mechanism Agreement among REIT, OPCO and PaineWebber dated April 6, 1998 (the
"PPAM Agreement").
NOW, THEREFORE, in consideration of the representations,
warranties and covenants herein contained, and on the terms and subject to
the conditions herein set forth, the Companies and PaineWebber hereby agree
as follows:
Section 1.01. DEFINITIONS. All capitalized terms used but
not defined herein shall have the meanings given them in the PPAM Agreement.
Section 1.02. REPRESENTATIONS. The representations,
warranties and covenants of the Companies in Section 4 of the Purchase
Agreement, dated as of April 6, 1998 (the "Purchase Agreement"), among the
Companies and PaineWebber are hereby incorporated by reference herein, and
the Companies hereby so represent, warrant and covenant to PaineWebber. The
provisions of Section 6 of the Purchase Agreement shall also be applicable to
any Paired Shares delivered to PaineWebber under this Agreement.
Section 1.03. INTERIM SETTLEMENT. The Companies agree to
deliver to PaineWebber Interim Settlement Shares for the Reset Date that
occurred on June 30, 1998, PROVIDED, HOWEVER, that such Interim Settlement
Shares need not be delivered pursuant to an effective registration statement
covering any sale of such Interim Settlement Shares by PaineWebber, PROVIDED
FURTHER that if such Interim Settlement Shares are not the subject of an
effective registration statement covering all sales of such Interim
Settlement Shares by PaineWebber by August 28, 1998, the Companies shall
deliver cash collateral to PaineWebber on such date in an amount equal to the
Interim Settlement Amount for the Reset Date that occurred on June 30, 1998.
Any cash collateral delivered by the Companies to PaineWebber pursuant to
this Section shall be subject to the provisions of Section 5.1 of the PPAM
Agreement. PaineWebber acknowledges that the Companies' obligations to
deliver Interim Settlement Shares to PaineWebber under Section 5.1 of the
PPAM Agreement with respect to the Reset Date occurring on June 30, 1998,
shall be satisfied upon the full performance by the
Companies of all their respective obligations under this Letter Agreement.
For the avoidance of doubt, such satisfaction is only with respect to the
obligations of the Companies arising with respect to the Reset Date occurring
on June 30, 1998, and in no way affects the obligations of the Companies with
respect to future Reset Dates.
Section 1.04. MISCELLANEOUS PROVISIONS. The
representations, warranties and covenants of the Companies contained in
Section 6 and Section 7 of the PPAM Agreement are hereby incorporated by
reference herein, and the Companies hereby so represent, warrant and covenant
to PaineWebber.
Section 1.05. GOVERNING LAW AND JURISDICTION. This Letter
Agreement will be governed by and construed in accordance with the laws of
the State of New York without reference to choice of law doctrine. With
respect to any suit, action or proceeding relating to this Letter Agreement
("Proceedings"), each party irrevocably submits to the exclusive jurisdiction
of the courts of the State of New York and the United States District Court
located in the Borough of Manhattan in New York City and waives any objection
which it may have at any time to the laying of venue of any Proceedings
brought in any such court, waives any claim that such Proceedings have been
brought in an inconvenient forum and further waives the right to object, with
respect to such Proceedings, that such court does not have any jurisdiction
over such party.
IN WITNESS WHEREOF, PaineWebber and the Companies have
caused this Letter Agreement to be duly executed and delivered, as of the
date first written above.
PATRIOT AMERICAN HOSPITALITY, INC.,
by /s/
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WYNDHAM INTERNATIONAL, INC.,
by /s/
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PAINEWEBBER FINANCIAL PRODUCTS, INC.,
by /s/
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