EXHIBIT 4.4
SUPPLEMENTAL SECURITY AGREEMENT
THIS SUPPLEMENTAL SECURITY AGREEMENT ("Agreement") is made as of the
28th day of August, 2002, by MARRIOTT RESIDENCE INN II LIMITED PARTNERSHIP, a
Delaware limited partnership ("Debtor") and LASALLE BANK NATIONAL ASSOCIATION
(f/k/a LASALLE NATIONAL BANK), AS TRUSTEE FOR NOMURA ASSET SECURITIES
CORPORATION COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1996-MD V
("Secured Party").
RECITALS
Pursuant to a certain Acknowledgment, Waiver and Consent
Agreement, dated August 28, 2002, by and between Debtor and Secured Party (the
"Consent Agreement"), Secured Party did consent to the consummation of the
"Transactions" as therein defined. The execution and delivery of this Agreement
to Secured Party is required by the terms of the Consent Agreement.
NOW, THEREFORE, WITNESSETH, that Debtor does hereby covenant and agree
as follows:
ARTICLE I
Defined Terms
Capitalized terms used in this Agreement without definition which are
defined in the Definitional Appendix attached hereto and incorporated herein
shall have the meanings assigned to them in such Appendix.
ARTICLE II
Supplemental Security Agreement
1. Grant of Security Interest. As additional security for all of the
Secured Obligations, whether or not any agreement or instrument relating to any
Secured Obligations specifically refers to this Agreement or the security
interest created hereunder or the collateral referred to herein, Debtor hereby
grants to Secured Party a lien on and continuing security interest in, and
pledges and assigns to Secured Party, all of the Debtor's rights under the
Tenant Security Agreement, and the Debtor's interest from time to time in the
Collateral described therein (collectively, the "Tenant Security Agreement
Collateral").
2. Covenants, Representations and Warranties Concerning Tenant Security
Agreement Collateral. Debtor covenants, represents and warrants that: (a) no
assignments of any of the Tenant Security Agreement Collateral have previously
been made (other than to Secured Party) and no financing statement, mortgage,
deed of trust, assignment, notice of lien or other security document publicizing
a security interest in or lien upon any of the Tenant Security Agreement
Collateral is or will be on file in any recording or filing office, and the
Tenant Security Agreement Collateral is and shall remain free and clear of all
liens, security interests, assignments and encumbrances of every kind, except
for Permitted Liens; and (b) Debtor is the legal and beneficial owner of all of
the Tenant Security Agreement Collateral.
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3. Warranties and Agreements Concerning Tenant Security Agreement
Collateral. Debtor warrants and agrees that, except as otherwise agreed by
Secured Party in the Loan Documents or in writing from time to time: (a) from
and after the occurrence of an Event of Default, Secured Party shall have the
right to receive, and Debtor shall promptly deliver, or cause to be delivered
promptly, to Secured Party and, until so delivered, Debtor shall hold as Secured
Party's agent and bailee, all money and other property in any form and for any
reason paid, payable, distributed or distributable to Debtor, or received or
receivable by Debtor, on account of or in respect of, or constituting, Tenant
Security Agreement Collateral, with such indorsements and/or assignments as
Secured Party may from time to time request; (c) all Tenant Security Agreement
Collateral delivered to Secured Party or coming into Secured Party's possession
or control from time to time shall be held by Secured Party as security for the
Secured Obligations; (d) Secured Party shall have the right, in its discretion,
at any time and from time to time following the occurrence and during the
continuance of an Event of Default (i) to sign Debtor's name on any drafts or
orders against, or demands, notices or other documents directed to, persons
obligated or liable to Debtor on account of or in respect of any of the Tenant
Security Agreement Collateral, (ii) to indorse Debtor's name on any instruments,
checks, drafts, orders or other items of payment constituting Tenant Security
Agreement Collateral that may come into Secured Party's possession or control
from time to time, and/or (iii) to cause, or to require Debtor to cause, any of
the Tenant Security Agreement Collateral to be registered in the name of Secured
Party or its nominees; (e) except as otherwise specifically permitted by this
Agreement or the Loan Documents, Debtor will not, directly or indirectly,
without Secured Party's prior written consent, sell, assign, transfer, convey or
otherwise dispose of, or suffer or permit to occur any sale, assignment,
transfer, conveyance or disposition of, any of the Tenant Security Agreement
Collateral, or any interest therein; and (f) except as otherwise specifically
permitted by this Agreement, Debtor will not, without Secured Party's prior
written consent, exercise or waive, or permit the waiver or loss of, any rights
of Debtor with respect to any of the Tenant Security Agreement Collateral, or
take any other action with respect to the Tenant Security Agreement Collateral
that would reduce Debtor's interest therein or the value thereof, or would
impair Secured Party's security interest or other rights therein.
4. Additional Agreements Concerning Tenant Security Agreement
Collateral. Debtor covenants and agrees that: (a) after the occurrence of an
Event of Default and during the continuance thereof, Secured Party shall have
the right, in its discretion, at any time and from time to time, to notify,
and/or to require Debtor to notify, any or all other persons obligated or liable
on or with respect to any of the Tenant Security Agreement Collateral to deliver
to Secured Party all money and other property in any form and for any reason
payable or distributable to Debtor, or receivable by Debtor, on account of or in
respect of, or constituting, Tenant Security Agreement Collateral; (b) after the
occurrence of an Event of Default and during the continuance thereof, Secured
Party shall have the right, in its discretion, from time to time, in the place
and stead of Debtor as though Secured Party were the absolute owner thereof, to
exercise any and all privileges, options and rights pertaining to the Tenant
Security Agreement Collateral, upon such terms and conditions as Secured Party
may determine in good faith; and (c) Debtor will notify Secured Party in writing
promptly following the obtaining of knowledge of the occurrence of any default
or event of default under or as defined in any documents, instruments or
agreements constituting the Tenant Security Agreement Collateral or any failure
of any party to any documents, instruments or agreements constituting such
Tenant Security Agreement Collateral, to observe, perform or comply with any
warranty, covenant, condition or agreement to be observed, performed or complied
with by such party pursuant to the such documents, instruments or agreements.
5. Remedies. Upon the occurrence of an Event of Default and during the
continuance thereof, Secured Party may, without notice or demand, enforce the
liens and security interests granted to Secured Party hereunder by collecting or
liquidating all or any part of the Tenant Security Agreement
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Collateral or selling, assigning, re-assigning or otherwise disposing of all or
any part of the Tenant Security Agreement Collateral or any interest therein, in
one or more parcels, at the same or different times, at public or private sale
or disposition, or otherwise. In addition to the foregoing, Secured Party may
exercise in any jurisdiction in which enforcement hereof is sought, all other
rights and remedies available to Secured Party under this Agreement and the
other Loan Documents, the rights and remedies of a secured party under the
Uniform Commercial Code and all other rights and remedies available to Secured
Party under law, all such rights and remedies being cumulative and enforceable
alternatively, successively or concurrently.
6. Collateral Dispositions. Debtor agrees that commercial
reasonableness and good faith require Secured Party to give Debtor no more than
ten (10) days' prior written notice of the time and place of any public
disposition of Tenant Security Agreement Collateral or of the time after which
any private disposition or any other intended disposition is to be made. All
sales or other dispositions of Tenant Security Agreement Collateral may be made
for cash, upon credit or for future delivery. In no event shall Debtor be
credited with any part of the proceeds of liquidation, sale or other disposition
of any Tenant Security Agreement Collateral until final payment of all of the
Secured Obligations has been received by Secured Party in immediately available
funds, and Secured Party shall have no obligation to delay any liquidation, sale
or other disposition because the same may result in the imposition of any
forfeiture, premium of penalty. In connection with any enforcement by Secured
Party of the liens and security interests granted to Secured Party pursuant to
this Agreement, Secured Party may demand, compromise, collect, enforce and xxx
for all money and other property in any form and for any reason payable or
distributable to Debtor, or receivable by Debtor, on account of or in respect
of, or constituting, Tenant Security Agreement Collateral, and otherwise
exercise all rights of Debtor with respect to the Tenant Security Agreement
Collateral, and all Tenant Security Agreement Collateral or proceeds of Tenant
Security Agreement Collateral delivered to Secured Party or coming into Secured
Party's possession or control from time to time may be applied by Secured Party
from time to time, in whole or in part to payment of the Secured Obligations in
any order permitted under the Loan Documents. Debtor covenants and agrees, at
Debtor's expense, to execute and deliver or cause to be executed and delivered,
and to do or cause to be done, all such acts, things, instruments and documents
as may, in the opinion of Secured Party or counsel to Secured Party, be
necessary or advisable to make all sales and dispositions of Tenant Security
Agreement Collateral valid, binding and enforceable and in compliance with all
applicable laws, rules and regulations and all judgments, orders, awards,
decrees, writs and injunctions of all courts, arbitrators or governmental
authorities, domestic or foreign, having jurisdiction over any such sales or
dispositions.
ARTICLE III
Additional Provisions
1. Authority, Enforceability and Conflicts. Debtor represents and
warrants that: (a) Debtor has full power and authority to enter into this
Agreement, to execute and deliver all documents and instruments required
hereunder and thereunder, and to incur and perform the obligations provided for
herein and therein, all of which have been duly authorized by all necessary
action, and no consent or approval of any person which has not been obtained, is
required as a condition to the validity or enforceability hereof or thereof, (b)
this Agreement has been duly executed and delivered by Debtor and constitutes,
and will continue to constitute, the valid and legally binding obligation of
Debtor, and is, and will continue to be, fully enforceable against Debtor in
accordance with its terms, subject to bankruptcy and other laws affecting the
rights of creditors generally and to the application of principles of equity;
and (c) the execution, delivery and performance by Debtor of this Agreement will
not violate (i) any
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applicable provision of law or any applicable order, rule or regulation of any
court or governmental authority, the violation of which would have a material
adverse effect on Debtor or on Secured Party's rights under the Loan Documents,
or (ii) any instrument, contract, agreement, indenture, mortgage, deed of trust
or other document or obligation to which Debtor is a party or by which Debtor,
or any of Debtor's property, is bound.
2. Expenses. Debtor agrees to pay to Secured Party, promptly upon
`demand by Secured Party from time to time, the amount of all expenses,
including attorneys' fees and expenses, reasonably paid or incurred by Secured
Party in protecting, preserving, exercising or enforcing, or consulting with
counsel concerning, any of Secured Party's rights or interests hereunder. If
payment of any of the foregoing amounts is not paid within ten (10) days after
demand, Debtor also agrees to pay to Secured Party, promptly upon demand by
Secured Party from time to time, interest on the outstanding amount of such
expenses paid by Secured Party, from the date of Secured Party's demand for
payment of such expenses until the same are paid in full, at the default
interest rate set forth in the Loan Documents.
3. Additional Documents. Debtor agrees to execute and deliver to
Secured Party, or cause to be executed and delivered to Secured Party, from time
to time promptly after request by Secured Party and in form and content
satisfactory to Secured Party, in Secured Party's discretion exercised in good
faith, such security agreements, financing statements, amendments of financing
statements, assignments of financing statements, assignments, indorsements,
proxies, powers, orders, drafts, instruments of transfer or withdrawal, notices,
consents and other documents as Secured Party may request in good faith in order
to confirm, supplement, preserve, protect or perfect, or to maintain the
perfection of, Secured Party's interest in the Tenant Security Agreement
Collateral and Secured Party's rights under this Agreement.
4. Agreement not Exclusive. These presents shall in no way operate to
pr event Secured Party from pursuing any remedy which it now or hereafter may
have because of any present or future breach of the terms or conditions of the
Loan Documents or any extension thereof. Nothing herein shall imply or infer
that any of the Tenant Security Agreement Collateral would or will not be
subject to the assignment and security provisions of the Loan Documents, it
being the intent of this Agreement to confirm and supplement the provisions
thereof, or that any right or remedy provided hereunder with respect thereto
shall supersede or otherwise exist in derogation of the rights and remedies
conferred thereunder. All rights and remedies of Debtor hereunder shall be
cumulative and enforceable alternatively, successively or concurrently with
those rights and remedies available under the Loan Documents and under
applicable law (including, without limitation, the Uniform Commercial Code).
5. Successors and Assigns. The terms, covenants, conditions and
warranties contained herein and the powers granted hereby shall inure to the
benefit of and bind all parties hereto and their respective heirs, executors,
administrators, personal representatives, successors and assigns.
6. Governing Law. This Agreement, the rights and obligations of the
parties hereto, and any claims or disputes relating thereto, shall be governed
by and construed in accordance with the laws of the State of New York (other
than those conflict of law provisions that would defer to the substantive laws
of another jurisdiction); it being understood, however, that to the extent that
this Agreement refers to any right or obligation of a party hereto under any
other agreement, such right or obligation shall be governed by and construed in
accordance with the governing law provided in such other agreement. Without in
any way limiting the preceding choice of law, the parties elect to be governed
by New York law in accordance with, and are hereby relying (at least in part) on
Section 5-1401 of the General Obligations Law of the State of New York.
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7. Release of Collateral. Upon payment of all of the Secured
Obligations, this Agreement shall be terminate automatically, and Secured Party
agrees to execute an instrument or instruments which shall reassign the Tenant
Security Agreement Collateral to the Debtor, together with such terminations of
Uniform Commercial Code financing statements and other instruments of
termination and release of the interests of Secured Party as the Debtor may
reasonably request.
8. Defaults and Remedies. The failure of Debtor to observe any condition
or covenant of this Agreement, if such failure is not remedied within 30 days
after Debtor receives notice thereof from Secured Party (which 30-day period
shall be subject to extension as provided in the the Mortgages), shall
constitute an Event of Default under the Loan Documents, following which Secured
Party shall be entitled to avail itself of any and all remedies available to
Secured Party under and in accordance with the Loan Documents.
9. Severability. In the event that any term or provision of this
Agreement or any other Loan Document shall be finally determined to be
superseded, invalid, illegal or otherwise unenforceable pursuant to applicable
law by a governmental authority or agency having jurisdiction and venue, that
determination shall not impair or otherwise affect the validity, legality or
enforceability (a) by or before that governmental authority or agency of the
remaining terms and provisions of this Agreement and the other Loan Documents,
which shall be enforced as if the unenforceable term or provision were deleted,
or (b) by or before any other governmental authority or agency of any of the
terms and provisions of this Agreement and the other Loan Documents.
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IN WITNESS WHEREOF, this Supplemental Security Agreement has
been properly executed and sealed by Debtor on the day and year first written
above.
SIGNED AND ACKNOWLEDGED IN THE DEBTOR:
PRESENCE OF:
MARRIOTT RESIDENCE INN II LIMITED
PARTNERSHIP, a Delaware limited
partnership
By: AHT Res II GP, Inc., a
Virginia corporation, its
General Partner
Witness: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxxx
------------------------ ----------------------------
Name: Xxxxx X. Xxxxxx
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Its: CEO
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DEFINITIONAL APPENDIX
"Event of Default" shall mean the occurrence of any event that
would automatically accelerate the maturity of the Secured Obligations, or which
would permit the Secured Party to accelerate the maturity of or otherwise
declare the Secured obligations due and payable.
"Loan Documents" shall have the meaning given to such term in
the Consent Agreement.
"Mortgages" shall have the meaning given to such term in the
Consent Agreement.
"Permitted Liens" shall mean security interests, liens and
other encumbrances permitted under the Loan Documents.
"Secured Obligations" shall mean obligations, indebtedness and
liabilities evidenced and secured by the Loan Documents.
"Tenant" shall mean AHM Res II Limited Partnership, a Virginia
limited partnership.
"Tenant Security Agreement" shall mean that certain Tenant
Security Agreement by and between Debtor and Tenant, dated as of, August 28,
2002 as the same may from time to time be amended, supplemented, renewed,
restated or otherwise modified.
"Tenant Security Agreement Collateral" shall mean: (a) all
present and future rights, titles and interests of Debtor in, to and under the
Tenant Security Agreement; and (b) all present and future proceeds of all of the
foregoing, including, without limitation, cash proceeds, non-cash proceeds and
proceeds acquired with cash proceeds, whether any such proceeds constitute
consumer goods, farm products, equipment, inventory, documents of title, chattel
paper, accounts, instruments or general intangibles, and including, without
limitation, all proceeds of insurance policies insuring any of the foregoing or
any risks relating to any of the foregoing.
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