LOAN AGREEMENT
EXHIBIT
10.35
This Loan
Agreement is made as of January 1, 2010 in the City of Boston, Massachusetts,
U.S.A. by and between
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1.
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SONESTA INTERNATIONAL HOTELS
LIMITED, organized and existing under the laws of the Bahamas and
having its principal place of business at 000 Xxxxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx, X.X.X. herein represented Xx. Xxxxx X. Xxxxxxxxx, in his
capacity as Vice President;
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(hereinafter
referred to as the “Lender”)
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2.
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MASTERS OF TOURISM,
organized and existing under the laws of the Arab Republic of Egypt and
having its principal place of business at Xxxxx Xxxxx Street, El Obour
Buildings, Xx.00, Xxxx 00, Xxxxxxxxxx, Xxxxx, Xxxxx herein represented in
this Agreement by Xx. Xxxxxxx Xxxxxx Xxxxx Aly in his capacity as
Chairman; and
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3.
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Xx. XXXXXXX XXXXXX XXXXX
ALY, residing at 000 Xxxxxx Xxxxx Xxxxxx, Xxxxx, Xxxx, ID number
24409250100571 in his personal
capacity.
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(2 &
3 hereinafter referred to jointly and severally as the “Borrower”)
The
Lender and Borrower shall be collectively hereinafter referred to as (the “Parties”)
Whereas,
the Lender agrees to provide the Borrower with a loan facility in the amount of
Five Hundred Thousand US Dollars (US$ 500,000) to be used as according to the
terms and subject to the conditions hereinafter mentioned.
NOW THEREFORE, in
consideration of the above promises and the mutual covenants herein contained,
the Parties hereby agree as follows:
Section 1,
Definitions
The
following terms shall have the meanings set forth below.
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1.01
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“Advance” shall mean an
advance to the Borrower by the Lender pursuant to Section 2 of this
Agreement.
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1.02
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“Banking day” shall mean
a day on which banks are open for business in New York and London for
interbank Dollar deposits in
London.
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1.03
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“Event of Default” shall
have the meaning set forth in Section 2.04 of this
Agreement.
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1.04
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“Indebtedness” shall
mean in regards to the Borrower all indebtedness (including guarantees and
other contingent obligations) with respect to borrowed
money.
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1.05
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“Lending office” shall
mean the office of the Lender located at its address or any other office
of such Lender as it may from time to time notify the
Borrower.
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1.06
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“Management Agreement”
shall mean and refer to the Amended and Restated Management Agreement
between Lender and Borrower, dated January 1, 2004, as amended on January
24, 2008 and by a “Second Amendment” of even date, under which Lender
operates the Hotel.
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Section 2, The
Loan
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2.01
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Agreement
to Lend. Subject to the terms and conditions of this Agreement, the
Lender hereby agrees to provide the Borrower with a loan facility through
Lender’s lending office in the amount of Five Hundred Thousand US Dollars
(US$ 500,000), or where the context may require, the amount thereof then
outstanding (“Loan”).
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2.02
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Purpose
of the Loan. The Borrower agrees that the Loan will be
used solely to finance the expansion and improvement of Sonesta Beach
Resort Sharm El-Sheikh (“Hotel”) by completing
the 167 deluxe guestrooms (“Guestrooms”) and related
support facilities (“Support Facilities”)
currently under construction on land immediately contiguous to the
existing Resort facilities, to the north, and as further described in the
“Second Amendment” referenced above. (The Guestrooms and
Support Facilities (described further in Exhibit
A hereto) are hereafter jointly and severally referred to as the
“Improvements”.) Borrower
further, warrants and represents that the proceeds of the Loan are
sufficient to complete the Improvements and render them ready for full
occupancy and use by Resort guests.
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Borrower
undertakes to deliver the Improvements to the Lender to operate as an additional
part of the Hotel by no later than January 15, 2010 (“Deadline”).
In
additional to any other remedies available to the Lender, failure to meet such
Deadline shall be deemed as a material breach of this Agreement and shall
entitle the Lender to liquidated damages of US $5,000 per day.
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2.03
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Interest. The
Borrower agrees to pay to the Lender interest on the Loan at a rate of
5.25% per annum.
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2.04
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Default
Interest.
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(A)
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Upon
the occurrence of an Event of Default, the Borrower shall, upon notice by
the Lender, pay on demand interest on the Loan outstanding at the rate
that is three (3) percentage points per annum above the interest rate on
the Loan calculated pursuant to Section
2.03.
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(B)
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In
addition to payment of such default interest, the Borrower shall indemnify
the Lender against any costs and losses, which are not covered by the
default interest payable pursuant to Section 2.04 (A) resulting from the
Borrower failing to pay when due any amounts of principal or interest
hereunder.
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2
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2.05
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Repayment
of Loan. Borrower and Lender acknowledge that the Loan
shall be repaid to Lender by Masters of Tourism with thirty-six (36)
checks in US Dollars – one for each month during 2010 (beginning February
2010), 2011 and 2012, and January 2013 – signed personally by Xx. Xxxxxxx
Xxxxxx Xxxxx Aly, Chairman of Masters of Tourism, and dated the 25th
day of each month. (The attached Exhibit
B represents the amounts of the payments if the proceeds of the
loan are disbursed in January 2010). In the event of any default, however,
and in addition to any other remedies available to Lender, Lender is
authorized by Borrower to repay the Loan out of the “Landlord’s Share”
distributable to Owner, together with interest. For this purpose,
“Landlord’s Share” is deemed to be net profits after all Resort expenses,
including Operator’s fees and monthly installments of loan repayments to
Operator, and after reserves deemed necessary by Operator in its
reasonable judgment. The Operator, under the said Management Agreement, is
hereby authorized and instructed to make any payment(s) due hereunder from
“Landlord’s Share” directly to itself as Lender
hereunder.
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Section 3,
Taxes
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3.01
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Taxes. The
Borrower shall hold the Lender harmless from any liability with respect to
the delay or failure by the Borrower to pay any taxes or charges imposed
by law or by any tax authority with regard to any aspect of the
transactions contemplated by this Agreement, and shall reimburse the
Lender upon demand for any such taxes paid by Lender in connection
herewith whether or not such taxes shall be correctly or legally asserted
or otherwise contested or contestable, together with any interest,
penalties, premiums, and expenses in connection
therewith.
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Section 4,
Covenants
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4.01
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Performance
of Obligations. The Borrower shall
perform all its other obligations, undertakings and covenants, and
punctually pay all indebtedness and all amounts due under this Agreement
and the Management Agreement at the times and on the dates specified
herein.
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Section 5, Events of
Default
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5.01
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Events
of Default. Each of the following events and occurrences shall
constitute an Event of Default under this
Agreement:
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(A)
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The
Borrower fails to make payment of any amount which it is obliged to pay
under this Agreement or the Management Agreement on the date when such
amount is due and payable.
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(B)
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It
becomes unlawful for the Borrower to make any payment to be made hereunder
on the due date hereof in US
Dollars.
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3
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5.02
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Consequence
of Default. If an Event of Default shall occur and be
continuing the Lender at its option may: By written notice to the Borrower
declare the Loan, together with accrued interest and any other sum payable
hereunder, to be immediately due and payable and the Loan shall thereupon
become due and payable without presentment, demand, protest or notice of
any kind, other than the notices specifically required by this section,
all of which are expressly waived by the Borrower; and the Borrower shall
also pay to the Lender such additional amounts as may be necessary to
compensate the Lender for any costs or losses resulting from such Event of
Default. The Borrower may also explicitly enforce the guarantees
referenced in Section 6.
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Section 6, Personal
Guaranty
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6.01
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Personal
Guaranty: the Borrowers shall be jointly and severally liable for
the repayment of the entirety of the Loan vis-à-vis the
Lender.
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Section 7,
Miscellaneous
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7.01
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Entire
Agreement. This Agreement and the documents referred to herein
constitute the entire obligation of the Parties hereto with respect to the
subject matter hereof and shall supersede any prior expressions of intent
or understandings with respect to this transaction. Any amendment hereto
shall be in writing, signed by or on behalf of the Parties to be bound or
burdened thereby.
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7.02
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Term. The
term of this Agreement shall commence on the date first set forth above
and terminate on the date of termination of the Lender’s commitment
hereunder or, if later, upon payment in full of all principal, interest
and other sums payable by the Borrower
hereunder.
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7.03
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Indemnification.
The Borrower agrees to indemnify and hold harmless the Lender from
and against any and all losses, claims, damages and liabilities directly
caused by any untrue or misleading statement or directly caused by any
omission of a material fact necessary to make the statements therein not
misleading.
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7.04
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Governing
Law and Dispute Settlement. This Loan Agreement shall be
governed by the Laws of the Arab Republic of
Egypt.
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Any
dispute arising under this Loan Agreement in relation to the interpretation or
implementation of this Agreement not amicably resolved shall be finally settled
by arbitration by the Cairo Regional Center for International Commercial
Arbitration (CRCICA) in accordance with such rules. The seat of
arbitration shall be Cairo, Egypt and the arbitration proceedings shall be
conducted in English. The unsuccessful party shall bear the fees and
costs of the arbitration including the lawyers’ fees of the prevailing party or
as otherwise decided by the arbitral tribunal. The award shall be
final and binding upon the parties subject to no appeal.
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7.05
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Counterparts.
This Agreement may be signed in any number of counterparts, any single
counterpart or a set of counterparts signed, in either case, by all the
parties hereby shall constitute a full and original agreement for all
purposes.
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7.06
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Reimbursement
of Costs. Borrower shall reimburse Lender’s costs of
preparing this Loan Agreement and related documentation, which costs are
limited to the fees and expenses charged by Counselor Sarwat Abd El Shahid
for reviewing this Loan Agreement and related transaction documentation
and advising the parties, but not to exceed US $20,000. If not
paid prior to the funding of the Loan, such reimbursement shall be
deducted from the first Loan proceeds advanced to
Borrower.
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IN WITNESS
WHEREOF, the Parties hereto have caused this Agreement to be executed in
Boston, Massachusetts, U.S.A., by their respective duly authorized signatories
as of the day and year first written above.
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Witness:
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SONESTA
INTERNATIONAL HOTELS LIMITED
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/s/ Mahmoud El
Maghraby
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By:
/s/ Xxxxx
X.
Xxxxxxxxx
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Name:
Xxxxx X. Xxxxxxxxx
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Title:
Vice President
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Witness:
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MASTERS
OF TOURISM
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/s/
Xxxxxxxxxx Xxxx
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By:
/s/
Xxxxxxx Xxxxxx Xxxxx Xxx
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Name: Xx.
Xxxxxxx Xxxxxx Xxxxx Aly
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Title:
Chairman
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Witness:
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/s/
Xxxxxxxxxx Xxxx
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By: /s/
Xxxxxxx Xxxxxx Xxxxx
Xxx
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Name:
Xxxxxxx Xxxxxx Xxxxx Xxx
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In his personal capacity
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6
Exhibit
A
(Guestrooms
and Support Facilities)
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167
deluxe guestrooms, featuring:
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o
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Italian
marble floors
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o
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Aluminum
windows from Germany with double-tempered glass (heat and sound
proof)
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o
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Bathrooms
fitted with Kohler USA fixtures; each with 2
sinks/basins
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o
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Flat-Screen
Televisions: 32 inch in deluxe rooms; one 32 inch and one 37
inch in junior suites; one 37 inch and one 42 inch in executive
suites
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o
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Beds
and mattresses Sealey model (Xxxxxxx &
Xxxxxx)
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o
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Mini-bars
(Electrolux)
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o
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3
telephones per guestroom; 2 analog, 1
digital
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Support
facilities, including:
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o
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Lounge/restaurant
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o
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Reception
area
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o
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Four
(4) heated swimming pools with
Jacuzzis
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o
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Boiler
room and electric station
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