Exhibit 10.3
PRINCIPAL GUARANTY
PRINCIPAL GUARANTY dated as of July 10, 1990, made by MARRIOTT
CORPORATION, a Delaware corporation (the "Guarantor") having an address at 00000
Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, Marriott/Portman Finance Corporation, a Delaware corporation
(the "Issuer"), The Citizens and Southern National Bank, as collateral trustee,
senior trustee and subordinated trustee, and the Guarantor, which Guarantor
expects to derive benefits, directly or indirectly, from the proceeds of the
offering described herein, have entered into an Indenture dated as of July 1,
1990 (as amended, modified or supplemented from time to time, the "Indenture")
in connection with the issuance by the Issuer of U.S. $159,000,000 Principal
Amount of Senior Secured Notes due July 10, 1997 (the "Senior Notes") and of
U.S. S40,000,000 Principal Amount of Subordinated Secured Notes due July 10,
1997 (the "Subordinated Notes"). The Senior Notes and the Subordinated Notes are
collectively referred to herein as the "Notes";
WHEREAS, this Principal Guaranty is provided pursuant to the terms of
the Indenture and the Subordinated Notes;
WHEREAS, it is a condition precedent to the issuance of the
Subordinated Notes by the Issuer pursuant to the Indenture that the Guarantor
shall have executed and delivered to the Subordinated Trustee a guaranty of
certain of the obligations of the Issuer under the Subordinated Notes; and
WHEREAS, the Guarantor has determined that its execution, delivery and
performance of this Principal Guaranty directly benefit, and are within the
corporate purposes and in the best interests of, the Guarantor;
NOW, THEREFORE, in consideration of the premises and the agreements
herein, the Guarantor hereby makes the following representations, warranties,
covenants and agreements to the Collateral Trustee, for the benefit of each
holder of the Subordinated Notes (a "Holder" and collectively the "Holders") and
to each Holder, and hereby agrees as follows:
SECTION 1. Definitions. Reference is hereby made to the Indenture for a
statement of the terms thereof. All terms used in this Principal Guaranty which
are defined therein and not
otherwise defined herein shall have the same meanings herein as set forth
therein.
SECTION 2. Principa1 Guaranty.
(a) The Guarantor hereby (i) irrevocably, absolutely and
unconditionally guaranties to the Collateral Trustee, for the benefit of each
Holder, and to each Holder, the prompt payment as and when due and payable at
Maturity of that portion of the Principal Amount of the Subordinated Notes that
shall constitute the Original Principal Amount of the Subordinated Notes (the
"Obligations"); and (ii) agrees to pay any and all reasonable expenses
(including counsel fees and expenses) incurred by the Collateral Trustee and the
Holders in enforcing their rights under this Principal Guaranty; provided,
however, that, notwithstanding any other provision of this Principal Guaranty to
the contrary, the maximum liability of the Guarantor hereunder with respect to
the Obligations shall in no event exceed the Guarantor's Maximum Principal
Guarantied Amount (as defined below). The Guarantor and the Collateral Trustee
acknowledge that the Obligations may at any time and from time to time exceed
the Maximum Principal Guarantied Amount and that same shall not impair this
Principal Guaranty or affect the rights and remedies of the Collateral Trustee
and the Holders hereunder.
(b) The Maximum Principal Guarantied Amount shall mean (i) $14,000,000
if the Guaranty Default Date (as defined below) occurs during the period from
and including July 10, 1990 through December 31, 1990, or (ii) $24,000,000 if
the Guaranty Default Date occurs during the period from and including January 1,
1991 through December 31, 1991, or (iii) $30,000,000 if the Guaranty Default
Date occurs on or after January 1, 1992.
(c) For the purpose of this Principal Guaranty the "Guaranty Default
Date" shall be the date of Maturity of the Subordinated Notes (whether at the
Stated Maturity, or earlier by declaration of acceleration or call for
redemption or otherwise) unless the declaration of acceleration results from an
Event of Default described in Sections 501(1) or (2) of the Indenture, in which
event the Guaranty Default Date shall be the date of such Event of Default;
provided, however, that if the Event of Default with respect to which the
Principal Amount of the Subordinated Notes has been accelerated shall thereafter
be cured and cease to be continuing, the Maximum Principal Guarantied Amount
shall thereafter be determined by reference to the next succeeding Guaranty
Default Date.
(d) Upon the occurrence and during the continuance of an Event of
Default under the Indenture, the Collateral Trustee and the Holders of the
Subordinated Notes shall make demand for payment under this Principal Guaranty
prior to making demand for payment under the Interest/Principal Guaranty, but
only with
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respect to the payment of that portion of the Original Principal Amount of the
Subordinated Notes then due and payable that does not exceed the Maximum
Principal Guarantied Amount under this Principal Guaranty. If payment shall not
be made under this Principal Guaranty on or prior to the close of business on
the Business Day following the date of such demand, the Collateral Trustee and
the Holders shall have the right to exercise any and all of the remedies in
Article FIVE of the Indenture or Article 19 of the Deed, or otherwise.
SECTION 3. Covenants. The Guarantor agrees that so long as any of the
Obligations are outstanding, unless the Collateral Trustee shall otherwise
consent in writing to the Guarantor, the Guarantor will:
(a) Solvency Certificates. Deliver Solvency Certificates to the
Collateral Trustee not less than thirty (30) days prior to each scheduled
increase in the Maximum Principal Guarantied Amount. Each Solvency Certificate
shall state that the Guarantor will be Solvent after giving effect to the
scheduled increase in the Maximum Principal Guarantied Amount pursuant to which
the Solvency Certificate is being delivered.
(b) Financial Statements. Furnish to the Collateral Trustee (i) as soon
as practicable and in any event within sixty (60) days after the close of each
of the first three quarters of each fiscal year of the Guarantor, as at the end
of and for the period commencing at the end of the previous fiscal year and
ending with such quarter, an unaudited consolidated balance sheet of the
Guarantor and its subsidiaries, together with unaudited consolidated statements
of income and surplus accounts of the Guarantor and its subsidiaries, all in
reasonable detail and certified by the chief accounting officer of the Guarantor
but subject to year-end audit and adjustments; (ii) as soon as practicable and
in any event within ninety (90) days after the close of each fiscal year of the
Guarantor as at the end for the fiscal year just closed, a consolidated balance
sheet of the Guarantor and its subsidiaries and a consolidated statement of
income and surplus accounts of the Guarantor and its subsidiaries for such
fiscal year, all in reasonable detail and audited by Xxxxxx Xxxxxxxx & Co. or
other independent certified public accountants of recognized standing selected
by the Guarantor; and (iii) with reasonable promptness, copies of all regular
and periodical financial and/or other reports which the Guarantor and its
subsidiaries may make available generally to stockholders and bondholders.
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SECTION 4. Designated Events.
(a) For the purpose of this Principal Guaranty, the term "Designated
Event" shall mean an event or series of events as a result of which:
(i) any Person or Group (within the meaning of Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), other than the Marriott Family (as hereinafter defined) and other
than any Employee Benefit Plan (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended) maintained by the
Guarantor or by any Affiliate of the Guarantor, becomes the Beneficial Owner
(as defined in Rule 13d-3 under the Exchange Act) of Voting Shares (as
hereinafter defined) entitled to cast more than 30% of the votes entitled to
be cast by the holders of all then outstanding Voting Shares; provided that
if the Marriott Family shall not be at the time of the event the Beneficial
Owner, in the aggregate, of Voting Shares entitled to cast at least 20% of
the votes entitled to be cast by the holders of all then outstanding Voting
Shares, a Designated Event shall be deemed to have occurred if any Person or
Group, other than any such Employee Benefit Plan, becomes the Beneficial
Owner of Voting Shares entitled to cast more than 20% of the votes entitled
to be cast by the holders of all then outstanding Voting Shares. For the
purpose of this Principal Guaranty, the term "Voting Shares" shall mean any
issued and outstanding shares of capital stock of the Guarantor then
entitled to vote in the election of directors and the term "Marriott Family"
means X. Xxxxxxx Marriott, Sr., his spouse, his siblings and their spouses
and any lineal descendants of any of them, and their spouses (or any
nominee, trust, foundation, holding company or Affiliate holding shares of
Marriott established by or for the benefit of any of them);
(ii) the Marriott Family shall acquire Voting Shares so that after
giving effect to such acquisition the Marriott Family shall become the
Beneficial Owner, in the aggregate, of Voting Shares entitled to cast more
than 50% of the votes entitled to be cast by the holders of all then
outstanding Voting Shares;
(iii) Guarantor shall merge or consolidate with or into another
Person (whether or not the Guarantor is the surviving corporation), or enter
into any sale, lease, exchange, transfer or other disposition (in a
transaction or series of related transactions) of all or substantially all
of the assets of the Guarantor, in either event pursuant to a transaction in
which all or substantially all of the Guarantor's Voting Shares are changed
into or exchanged for
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cash, securities or other property and excluding transactions between the
Guarantor and any of its Subsidiaries. For the purpose of this clause (iii)
only, the term "Subsidiary" shall mean any corporation or other entity of
which a majority of each class or series of equity securities or other
comparable ownership interests is owned, directly or indirectly, by the
Guarantor immediately prior to the time the merger, consolidation or
disposition of assets occurs;
(iv) Guarantor or any Subsidiary acquires, by merger, consolidation
or acquisition of assets or stock or otherwise, any Person whose total
assets on a consolidated basis have a fair market value (as determined in
good faith by the Board of Directors of the Guarantor, whose determination
shall be conclusive) which exceeds 50% of the fair market value (as
determined in good faith by the Board of Directors of the Guarantor, whose
determination shall be conclusive) of the Guarantor's total assets on a
consolidated basis immediately prior to such acquisition. For the purpose of
clauses (iv) and (vi) only, the term "Subsidiary" shall mean any corporation
or other entity of which the Guarantor owns a majority of the issued and
outstanding securities then entitled to vote in the election of directors,
general partners or other persons or entities holding similar duties,
obligations and powers;
(v) during any period of twenty-four (24) consecutive months,
Persons who at the beginning of such period constitute the Guarantor's Board
of Directors cease to constitute a majority of the directors then in office
other than with the consent of a majority of the Continuing Directors. For
the purpose of this clause (v), "Continuing Directors" shall mean a Person
who was a member of the Board of Directors of the Guarantor as of January 1,
1990, or a Person thereafter elected by the stockholders or appointed by the
Board of Directors whose appointment or recommendation by the Board of
Directors for election by the Guarantor's stockholders was approved by at
least a majority of the Continuing Directors then on the Board of Directors;
(vi) the Guarantor and/or any Subsidiary purchases or otherwise
acquires, directly or indirectly, the Guarantor's Voting Shares, if after
giving effect to any such acquisition, the Guarantor and its Subsidiaries
have acquired 30% or more of such Voting Shares within any period of twelve
(12) consecutive months; or
(vii) on any date, the Guarantor makes any distribution of cash,
property or securities (other than additional Voting Shares of the Guarantor
or regular cash dividends) to holders of the Guarantor's Voting Shares or
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purchases or otherwise acquires its Voting Shares and the sum of such
distributions and purchases during any period of twelve (12) consecutive
months is at least 30% of the aggregate fair market value (based on the
Current Market Price (as defined below)) of the Guarantor's outstanding
capital stock on the day prior to the first day of such distribution or
purchase. For the purpose of this Principal Guaranty, "Current Market Price"
shall mean the closing price (or, if none, the average of the last daily bid
and asked prices) of the applicable class of capital stock as quoted by the
primary securities exchange on which the stock is traded, or, if none, the
primary inter-dealer quotation system, which reports quotations for the
class of capital stock, for the last trading day immediately prior to the
occurrence of the event to which this definition applies.
The Guarantor shall give to the Collateral Trustee written notice of the
occurrence of a Designated Event, not later than 10 days following the date of
the first public announcement or public notice of the Designated Event in the
case of any Designated Event specified in clauses (i) or (ii) and not later than
10 days following the date of the occurrence of the Designated Event in the case
of any Designated event specified in clauses (iii), (iv), (v), (vi) or (vii).
(b) From and after the occurrence of a Triggering Event (as hereinafter
defined) the Guarantor shall comply with the provisions of Article Fourteen of
the Indenture. The term "Triggering Event" shall mean the reduction of the
Rating of the Guarantor by either Rating Agency to less than Baa3 (in the case
of Xxxxx'x Investor Services, Inc.) or BBB - (in the case of Standard & Poor's
Corporation) during the Determination Period. The term "Determination Period"
shall mean the 90-day period commencing on the first public announcement or
public notice of a Designated Event; provided that if a Rating Agency shall
publicly announce during such 90-day period that the Rating of the Guarantor is
under review, the Determination Period shall be extended for an additional
period, expiring on the earlier of 180 days following the initial commencement
of the Determination Period and the first Business Day following the public
announcement by the Rating Agency of the Rating of the Guarantor or that the
Rating of the Guarantor is no longer under review.
SECTION 5. Representations and Warranties. The Guarantor hereby
represents and warrants as follows:
(a) The Guarantor (i) is a corporation duly organized, validly
existing and in good standing under the laws of the state of its incorporation
as set forth on the first page hereof, (ii) has all requisite corporate power
and authority to execute, deliver and perform this Principal Guaranty, the
Interest/Principal Guaranty, the Indenture and each other
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agreement or instrument related thereto to which the Guarantor is a party, and
(iii) is duly qualified to do business in every jurisdiction in which the
failure so to qualify could have a material adverse effect on the business of
the Guarantor and its consolidated subsidiaries taken as a whole.
(b) The Guarantor has examined the Indenture, including the Exhibits
annexed thereto, and all of the representations and warranties set forth in the
Indenture, to the extent the same relate to the Guarantor, are true and correct
in all material respects.
(c) Except for defaults, conflicts and breaches that do not materially
affect the Guarantor's right, authority and ability to perform its obligations
under the Indenture, the Notes, this Principal Guaranty, the Interest/Principal
Guaranty each other agreement or instrument related thereto to which the
Guarantor is a party (all such documents are together referred to herein as the
"Marriott Documents") or that do not materially impair the rights, remedies or
security of the Collateral Trustee and the Holders under this Principal
Guaranty, the execution, delivery and performance by the Guarantor of the
Marriott Documents (i) have been duly authorized by all necessary corporate
action, (ii) do not and will not contravene its charter or by-laws, law or any
contractual restriction binding on or affecting the Guarantor or any of its
properties, and (iii) do not and will not result in or require the creation of
any lien, security interest or other charge or encumbrance upon, or with respect
to, any of its properties.
(d) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or other regulatory body is required
on or prior to the date hereof for the due execution, delivery and performance
by the Guarantor of the Marriott Documents.
(e) Each of the Marriott Documents is a legal, valid and binding
obligation of the Guarantor, enforceable against the Guarantor in accordance
with its terms, except as enforcement of such terms may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally and except that the availability of equitable remedies is
subject to the discretion of the court before which any proceedings may be
brought.
(f) After giving effect to the transactions contemplated by the
Indenture and the execution and delivery of this Principal Guaranty and the
other Marriott Documents, the Guarantor has complied with and performed all of
its material covenants and agreements contained in all applicable provisions of
its agreements for borrowed money and there has not occurred any event of
default, or any condition, act or event, which upon
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the giving of notice or lapse of time or both, would constitute an event of
default, under its agreements for borrowed money, except for defaults that do
not materially affect the Guarantor's right, authority and ability to perform
its obligations under the Marriott Documents or do not materially impair the
Collateral Trustee's or the Holders' rights, remedies or security under this
Principal Guaranty.
(g) There is no action, suit or proceeding pending or, to the best of
the Guarantor's knowledge, threatened against or otherwise affecting the
Guarantor before any court or other governmental authority or any arbitrator
which may reasonably be expected to materially adversely affect the Guarantor's
ability to perform its obligations hereunder or under any other Marriott
Document.
(h) After giving effect to the transactions contemplated by the
Indenture, the Notes, this Principal Guaranty and the Interest/Principal
Guaranty, the Guarantor is Solvent.
(i) The Guarantor will do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence, rights
(charter and statutory) and franchises; provided, however, that the Guarantor
shall not be required to preserve any such right or franchise if it shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Guarantor.
SECTION 6. Events of Default. An "Event of Default" shall exist under
this Principal Guaranty if any of the following shall have occurred:
(a) the Guarantor defaults in the payment of its obligations with
respect to this Principal Guaranty as and when the same shall become due and
payable;
(b) the Guarantor defaults in the observation or performance of any
covenant made in Section 3(a) hereof and such default shall continue unremedied
for a period of ten (10) days after such default shall become known to the
Guarantor;
(c) the Guarantor defaults in the payment, observation or performance
of any covenant, condition or agreement set forth herein (other than the payment
of the Obligations or any covenant made in Section 3(a)) and such failure
continues for more than thirty (30) days after written notice of such default
has been given to the Guarantor by the Subordinated Trustee;
(d) any event of default under any Indebtedness (or any Refinancing
thereof), whether now existing or hereafter created, issued pursuant to the
Indenture, dated as of April 1, 1985, between the Guarantor and The First
National Bank of
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Chicago, as trustee (the "Marriott Indenture"), if either (i) such event of
default results from any failure to pay all or any Portion of such Indebtedness
as and when due (after giving effect to any applicable cure period) or (ii) as a
result of such event of default such Indebtedness (or such Refinancing) shall
become due and payable prior to the stated maturity thereof. As used in this
Section, "Refinancing" shall mean any Indebtedness issued in exchange for or the
proceeds of which are used to repay, refinance or otherwise retire for value
Indebtedness under the Marriott Indenture or any Refinancing;
(e) the entry by a court having jurisdiction of a decree or order for
relief with respect to the Guarantor in an involuntary case or proceeding
commenced against the Guarantor under any applicable Federal or state
bankruptcy, insolvency, reorganization (relating to an insolvency) or other
similar law or the appointment of a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Guarantor, or of any
substantial part of its property, or in connection with such a proceeding
ordering the winding up or liquidation of its affairs, and any such decree or
order for relief or any such appointment remains unstayed and in effect for a
period of ninety (90) consecutive days;
(f) the commencement by the Guarantor of a voluntary case or proceeding
under any applicable Federal or state bankruptcy, insolvency, reorganization (in
connection with an insolvency) or other similar law or the commencement by the
Guarantor of any other case or proceeding to be adjudicated a bankrupt or
insolvent, or the consent by the Guarantor to the entry of a decree or order for
relief in an involuntary case or proceeding commenced against the Guarantor
under any applicable Federal or state bankruptcy, insolvency, reorganization (in
connection with the insolvency of the Guarantor) or other similar law, or the
filing by the Guarantor of a petition or answer or consent seeking
reorganization or relief under any applicable Federal or state bankruptcy,
insolvency or similar law, or the consent by the Guarantor to the filing of such
petition or to the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or similar official of any
substantial part of the property of the Guarantor, or the making by the
Guarantor of an assignment for the benefit of creditors generally, or the
admission by the Guarantor in writing of its inability to pay its debts
generally as they become due;
(g) any warranty, representation or other statement by the Guarantor
contained in this Principal Guaranty or any other writing delivered in
connection herewith or in connection with the Indenture or any other Marriott
Document shall prove to have been false or misleading in any material respect
when made and (i) the same is not cured or corrected within thirty (30) days
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after written notice thereof to the Guarantor by the Collateral Trustee, or (ii)
the same cannot be cured; or
(h) the Guarantor fails to pledge the Guaranty Support Collateral if
and as required in accordance with Article Fourteen of the Indenture.
The Guarantor acknowledges that an Event of Default under this
Principal Guaranty shall constitute an Event of Default under the Indenture with
the effect as in the Indenture provided.
SECTION 7. Guarantor's Obligations Unconditional.
(a) The Guarantor hereby guaranties, subject to the Maximum Principal
Guarantied Amount, that the Obligations will be paid strictly in accordance with
the terms of the Indenture. The liability of the Guarantor hereunder shall be
absolute and unconditional irrespective of: (i) any lack of validity,
irregularity or enforceability of the Indenture, the Interest/Principal
Guaranty, this Principal Guaranty, the Notes, the Real Estate Security Documents
or any other agreement or instrument relating thereto; (ii) any change in the
time, manner or place of payment of or in any other term in respect of all or
any of the Obligations, or any other amendment or waiver of, or consent to, any
departure from the Indenture, the Interest/Principal Guaranty, this Principal
Guaranty, the Real Estate Security Documents, the Notes or any other agreement
or instrument relating thereto; (iii) any exchange or release of or non-
perfection of any lien on or security interest in, any collateral, or any
release or amendment or waiver of or consent to any departure from the Deed, the
Secured Note, the Indenture or the Notes granted by the Collateral Trustee or by
any Holder, for all or any part of the Obligations, Drovided, however, that,
notwithstanding the foregoing, no such change, release, amendment, waiver or
consent shall, without the consent of the Guarantor, increase the Principal
Amount of the Subordinated Notes; (iv) any failure to enforce the provisions of
the Indenture, any Real Estate Security Documents, any Subordinated Note or any
other agreement or instrument relating thereto; or (v) any other circumstance
which might otherwise constitute a defense available to, or a discharge of, the
Owner, the Issuer or the Collateral Trustee or any other guarantor with respect
to the Obligations or the Guarantor with respect hereto or the obligations of
the Guarantor under any Marriott Documents.
(b) This Principal Guaranty (i) is a continuing guaranty and shall
remain in full force and effect until the indefeasible satisfaction in full of
the Obligations and the payment of the other expenses to be paid by the
Guarantor pursuant hereto; and (ii) shall continue to be effective or shall be
reinstated, as the case may be, if at any time any payment of
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any of the Obligations is rescinded or must otherwise be returned by any Holder
upon the insolvency, bankruptcy or reorganization of the Owner, the Issuer or
otherwise, all as though such payment had not been made.
(c) The Guarantor understands that upon the occurrence of an "Event of
Default" under the Deed causing the acceleration of the Secured Note, any
proceeds realized as a result of the foreclosure of the Mortgaged Premises or
any part thereof, or other enforcement of the Deed or any other disposition of
any collateral security for the Secured Note shall be deemed to have been
applied in the order of priority established by Section 506(a) of the Indenture,
notwithstanding that, as a result of the direction of any court, the Collateral
Trustee shall apply any of such payments or proceeds in any other or different
order of priority. Therefore, the Guarantor further agrees that in the event net
proceeds shall be realized as a result of the foreclosure of the Mortgaged
Premises or other enforcement of the Deed or otherwise (whether prior to or
after maturity of the Secured Note) or net proceeds shall be realized upon the
disposition of any other collateral security for the Secured Note, or if the
Collateral Trustee receives any other payments or prepayments of the Secured
Note or with respect of any of the collateral security for the Secured Note,
then, irrespective of the collateral security in respect of which such proceeds
were derived, without regard to the priority of application of such proceeds
pursuant to the Real Estate Security Documents, such payments or net proceeds
shall, for purposes of this Principal Guaranty, be deemed allocable, and be
applied, in accordance with the priorities established by Section 506(a) of the
Indenture.
SECTION 8. Waivers: Waiver of Subrogation.
(a) The Guarantor hereby waives (i) promptness and diligence; (ii)
notice of acceptance and notice of the incurrence of any Obligation by the
Issuer; (iii) notice of any actions taken by the Issuer, any Holder, the
Collateral Trustee, the Subordinated Trustee or any other party under the
Indenture, the Real Estate Security Documents or any other agreement or
instrument relating thereto; (iv) notice of any actions against the Owner taken
by the Issuer, any Holder, the Collateral Trustee, the Subordinated Trustee or
any other party under the Indenture, the Real Estate Security Documents or any
other agreement or instrument relating thereto; (v) (except for notices and
demands for which express provision is made in this Principal Guaranty) all
other notices, presentments, demands and protests, and all other formalities of
every kind in connection with the enforcement of the Obligations or of the
obligations of the Guarantor hereunder, the omission of or delay in which, but
for the provisions of this Section 8, might constitute grounds for relieving the
Guarantor of its obligations hereunder; (vi) the filing of a claim with a court
in the event of merger or
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bankruptcy of the Issuer or the Owner; and (vii) any requirement including,
without limitation, the provisions of Official Code of Georgia Annotated Section
10-7-24, that the Collateral Trustee, any Series Trustee or any Holder protect,
secure, perfect or insure any security interest or lien or any property subject
thereto or exhaust any right or take any action against the Owner, the Issuer or
any other Person or any collateral.
(b) Until the Notes and the Secured Note have been indefeasibly paid in
full, the Guarantor will not exercise any rights which it may have or acquire by
way of subrogation hereunder, by any payment made by it hereunder or otherwise.
Until the Notes and the Secured Note have been indefeasibly paid in full, the
Guarantor hereby unconditionally and irrevocably waives any subrogation rights
and any rights of reimbursement, contribution or indemnity from or with respect
to the Collateral Trustee, the Issuer, the Owner or AMMLP whether now or
hereafter existing and whether arising under contract, under law or equity or
otherwise. If any amount shall be paid to the Guarantor on account of such
subrogation rights at any time prior to the indefeasible payment in full of the
Notes and the Secured Note and all such other expenses, such amount (subject to
the limitations of Section 2 hereof) shall be paid over to the Collateral
Trustee, in the original form and on the date of receipt thereof, with any
necessary endorsements, to be applied in whole or in part by the Collateral
Trustee against the Obligations, whether matured or unmatured, and all such
other expenses in accordance with the terms of this Principal Guaranty and the
Indenture, as such Indenture relates to the Notes.
SECTION 9. Submission to Jurisdiction; Waivers.
(a) By the execution and delivery of this Principal Guaranty, the
Guarantor hereby irrevocably submits, to the extent permitted by applicable law,
to the jurisdiction of any New York State or Federal court sitting in New York
City, Borough of Manhattan, or of any Georgia State or Federal Court sitting in
Xxxxxx County, Georgia in any action or proceeding arising out of or relating to
the Indenture, this Principal Guaranty or the Notes, and the Guarantor hereby
irrevocably agrees that all claims against it with respect to such action or
proceeding against the Guarantor may be heard and determined in such courts. To
the extent permitted by applicable law, no other court, except those described
in the preceding sentence, will have any jurisdiction in any action or
proceeding against the Guarantor arising out of or relating to the Indenture,
this Principal Guaranty or the Notes. The Guarantor hereby irrevocably appoints
The Xxxxxxxx-Xxxx Corporation System, Inc. (the "Process Agent") at its offices
at Xxx Xxxx & Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 and 00 Xxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxx 00000 as its agent to receive, on behalf of the
Guarantor and its property, service of the summons and complaint and any other
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process which may be served in any such action or proceeding in the courts
referred to in the first sentence of this Section 9. Such service may be made
by delivering by hand or certified or overnight mail a copy of such process to
the Guarantor, in care of the Process Agent at either of the Process Agent's
addresses set forth above and the Guarantor hereby irrevocably authorizes and
directs the Process Agent to accept such service on its behalf, with delivery of
a copy thereof to the Guarantor in the same manner and to the same address as
notices are required to be delivered to the Guarantor under Section 10. To the
extent permitted by applicable law, the Guarantor agrees that a final judgment
obtained in any such court described in the first sentence of this Section 9 in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
(b) Subject to the exclusive jurisdiction provided in Subsection (a)
above, nothing in this Section 9 shall affect the right of the Collateral
Trustee or any Holder to serve legal process in any other manner permitted by
law.
(c) To the extent that the Guarantor has or hereafter may acquire any
immunity from jurisdiction of any such court referred to in the first sentence
of Subsection (a) above or from any legal process (whether through service or
notice, attachment prior to judgment, attachment in aid of execution, execution
or otherwise) with respect to itself or its property, to the extent permitted by
applicable law, the Guarantor hereby irrevocably waives such immunity with
respect to its obligations under the Indenture, this Principal Guaranty and the
Notes.
(d) The Guarantor hereby irrevocably waives, to the extent permitted by
applicable law, any objection, including, without limitation, any objection to
the laying of venue or based on the grounds of forum non conveniens, which it
may now or hereafter have to the bringing of any such action or proceeding in
such respective courts referred to in the first sentence of Subsection (a)
above.
(e) The Guarantor and each Holder, by its purchase of the Subordinated
Notes, irrevocably waive (and, in the case of each Holder, direct the Collateral
Trustee to waive), to the extent permitted by applicable law, all right to trial
by jury in any action, proceeding or counterclaim arising out of or relating to
the Indenture, this Principal Guaranty or the Notes or the transactions
contemplated hereby or thereby.
(f) The appointment of the Process Agent pursuant to Subsection (a)
above shall be irrevocable so long as the Holders shall have any rights pursuant
to the terms of this Principal Guaranty until the appointment of a successor by
the Guarantor with the consent of the Collateral Trustee (which consent will
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not be unreasonably withheld or delayed) and such successor's acceptance of such
appointment. The Guarantor further agrees to take any and all action, including
the execution and filing of any and all such documents and instruments, as may
be necessary to continue such designation and appointment of such agent or
successor.
SECTION 10. Notices. Etc. All notices and other communications provided
for hereunder to be given to
(a) the Collateral Trustee by the Guarantor shall be deemed sufficient
for every purpose hereunder when received by the Collateral Trustee at its
Corporate Trust Office, 00 Xxxxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000,
Attention: Corporate Trust Department, either personally, by courier, telegram,
facsimile transmission or mailed, first-class postage prepaid, or
(b) the Guarantor by the Collateral Trustee shall be sufficient for
every purpose hereunder when received by the Guarantor at 00000 Xxxxxxxx Xxxx,
Xxxxxxxx, Xxxxxxxx 00000, Attention: Legal Department, with copies to the
Issuer, or at any other address for the Guarantor filed with the Collateral
Trustee by the Guarantor if in writing and either delivered personally with
receipt acknowledged, or mailed by registered or certified mail, first-class
postage prepaid, return receipt requested. Any notice or other communication
delivered under this Section 10(b) shall be deemed given or served as of the
date of the delivery to the Guarantor, except that if a notice or other
communication is refused delivery or cannot be delivered because of a changed
address of which no notice was given, such notice or other document shall be
deemed to have been delivered on the date of such refusal or inability to
deliver.
SECTION ll. Miscellaneous.
(a) The Guarantor will make each payment hereunder in lawful money of
United States of America and in immediately available funds to the Collateral
Trustee at its address specified in Section 10 hereof.
(b) No amendment of any provision of this Principal Guaranty shall be
effective unless it is in writing and signed by the Guarantor, the Issuer and
the Collateral Trustee, and no waiver of any provision of this Principal
Guaranty, and no consent to any departure by the Guarantor therefrom, shall be
effective unless it is in writing and signed by the Issuer and the Collateral
Trustee, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
(c) No failure on the part of the Collateral Trustee or any Holder to
exercise, and no delay in exercising, any right
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hereunder or under the Indenture or any other agreement or instrument related
thereto shall operate as a waiver thereof, nor shall any single or partial
exercise of any right preclude any other or further exercise thereof or the
exercise of any other right. The rights and remedies of the Collateral Trustee
or any Holder provided herein, in the Indenture and in any other agreement or
instrument related thereto are cumulative and are in addition to, and not
exclusive of, any rights or remedies provided by law. The rights of the
Collateral Trustee and the Holders under the Indenture or any other agreement or
instrument related thereto against any party thereto are not conditional or
contingent on any attempt by the Collateral Trustee or any Holder to exercise
any of its rights under the Indenture and the Real Estate Security Documents or
any other agreement or instrument related thereto against such party or against
any other Person.
(d) Any provision of this Principal Guaranty which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining portions hereof or thereof or affecting the validity or enforceability
of such provision in any other jurisdiction.
(e) This Principal Guaranty shall (i) be minding on the Guarantor and
its successors and assigns, and (ii) inure, together with all rights and
remedies of the Collateral Trustee and each Holder hereunder, to the benefit of
each Holder and its successors, transferees and assigns. Without limiting the
generality of clause (ii) of the immediately preceding sentence, each Holder may
assign or otherwise transfer its Subordinated Note and its rights under the
Indenture or any other agreement or instrument related thereto in accordance
with the terms of its Subordinated Note and the Indenture, to any other Person,
and such other Person shall thereupon become vested with all of the benefits
with respect thereto granted to the Holder herein or otherwise. None of the
rights or obligations of the Guarantor hereunder may be assigned or otherwise
transferred without the prior written consent of the Issuer and the Collateral
Trustee.
(f) This Principal Guaranty shall be governed by and construed in
accordance with the law of the State of New York applicable to contracts made
and to be performed wholly within such State.
(g) This Principal Guaranty shall not be valid or obligatory for any
purpose as to any Note until a certificate of authentication of such Note shall
have been manually executed by or on behalf of the Collateral Trustee.
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(h) Time is of the essence in the performance of this Principal
Guaranty.
IN WITNESS WHEREOF, the guarantor has caused this Principal Guaranty to
be executed by an officer thereunto duly authorized, as of the date first above
written.
MARRIOTT CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
-----------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: Asst. Treasurer
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