SUPPLEMENTAL LIMITED JOINDER
Exhibit
10.10
In
order
to induce Lender to make the Loan, the undersigned Net Worth Guarantor(s)
have
agreed to enter into this Supplemental Limited Joinder in connection with that
certain Loan Agreement
(the "Loan Agreement") dated February 8, 2006, between
ADRIAEN'S LANDING HOTEL, LLC,
a
Connecticut limited liability company ("Borrower"), and XXXXXXX
XXXXX CAPITAL, a Division
of Xxxxxxx Xxxxx Business Financial Services Inc., a Delaware corporation
(collectively, with its successors
and assigns, "Lender"). (All capitalized terms not otherwise
defined herein shall have the meanings
set forth in the Loan Agreement.) Each Principal acknowledges that without
this
Supplemental Limited Joinder, Lender would be unwilling to make the Loan. NOW,
THEREFORE, in consideration of the
foregoing and for other good and valuable consideration, the receipt and
sufficiency of which are hereby
acknowledged, the undersigned hereby agree and covenant as follows:
1. Retained
Liabilities.
Except
for the Retained Liabilities (defined below) and the obligations, if any, of
any
Principal under any separate guaranty provided to Lender in connection with
the
Loan,
no Net Worth Guarantor shall be personally liable to pay the Loan, or any other
amount due, or to
perform any obligation, under the Loan Documents, and Lender agrees to look
solely to all revenue and assets
of
Borrower, the Project and any other collateral heretofore, now, or hereafter
pledged by any party to secure the Loan. The obligations of each Net Worth
Guarantor hereunder are separate and independent obligations
and are not secured by the grant or pledge by Borrower pursuant to the Mortgage.
This Supplemental
Limited Joinder is a guaranty of full and complete payment and performance
and
not of collectability.
Each Net Worth Guarantor, jointly and severally, shall be personally liable
for
the following
(the "Retained Liabilities"):
(a) All
losses, damages, causes of actions, suits and Expenses incurred by Lender or
any
Affiliate or agent thereof as a result of (i) any failure after the occurrence
and during the continuance of
any
default by Borrower (without benefit of any applicable grace or cure period)
to
apply any portion of
the
revenue from the Project to the Loan as required per the Loan Agreement or
to
customary operating expenses
of the Project, (ii) fraud by any Borrower Party, (iii) misapplication,
misappropriation or conversion
by any Borrower Party of any rents, proceeds or funds deriving from (A) the
Project, (B) any insurance
proceeds paid by reason of any loss, damage or destruction to the Project and
not used by Borrower
for restoration or repair of the Project; and/or (C) any awards or amounts
received in connection with condemnation of all or a portion of the Project
and
not used by Borrower or Operating Lessee for restoration or repair of the
Project, (iv) material misrepresentation, (v) any material waste or abandonment
of the Project, (vi) failure to keep the Project insured in accordance with
the
terms of the Loan Documents to
the
extent of Gross Revenue available therefore, (vii) any fees paid by Borrower
or
Operating Lessee to a
Principal, Net Worth Guarantor, Manager, Asset Manager, Operating Lessee or
any
Affiliate after any default
under the Loan Documents, (viii) any breach of the Environmental Obligations
by
Borrower or any Environmental Indemnitor or any representation or warranty
contained in Article
6
of the
Loan Agreement (Environmental Matters), (ix) Borrower's hiring of employees
in
violation of the Loan Documents,
(x) voluntary termination of the License Agreement by Borrower or Operating
Lessee, (xi)
any
failure of Borrower or any Principal (or any other holder of the liquor license
or liquor permit) to fully cooperate with Lender in the transfer of the liquor
license for the Project to Lender, or its designee, following a foreclosure
or
deed-in-lieu of foreclosure or in operating all bar and other facilities
requiring a liquor
license during such transition period; or (xi) any claim against Lender by
any
depository bank which is the holder of a Depository Account unless such claim
is
solely the result of Lender's gross negligence
or willful misconduct; (xiii) the failure of Borrower to obtain the Final C/O
on
or before June
30,
2006, for any reason whatsoever; or (xiv) Lender becoming liable (by operation
of law or pursuant
to Lender's exercise of any rights or remedies under the Loan Documents or
otherwise) for any of
Borrower's liabilities under the Tax Assessment Fixing Agreement first arising
prior to the date on which
Lender (or its nominee) takes title to the Project whether by foreclosure of
the
Mortgage, deed-in-lieu
thereof or otherwise.
(b) Repayment
of the Loan, the Exit Fee, all costs and expenses of Lender, and all
other
payment obligations of Borrower under the Loan Documents in the event of (i)
any
breach by Borrower
of any of the following covenants of the Loan Agreement in (A) Section
4.2(b)
(transfers and change
of
control), (B) Section
4.2(l)
(no
additional debt or encumbrances), (C) Section
4.2(m) (organizational
documents), (D) Section 4.2(n) (single purpose entity), or (E) Section
4.2(u) (depository accounts
and credit card issuers), or (F) Section
4.2(cc)
(revocation of the temporary c/o), or (ii) the filing by
Borrower or Operating Lessee or any Net Worth Guarantor or any Principal, or
the
filing against Borrower
or Operating Lessee or any Net Worth Guarantor or any Principal by any Principal
or any Net Worth
Guarantor or any Affiliate of any Principal or any Net Worth Guarantor, of
any
proceeding for relief
under any federal or state bankruptcy, insolvency or receivership laws or any
assignment for the benefit
of creditors made by Borrower or Operating Lessee.
(c) Satisfaction
of the obligations of Net Worth Guarantors under the Net Worth Guaranty
of even date herewith in favor of Lender.
The
liability of each Net Worth Guarantor shall be direct and immediate as a primary
and not
a
secondary obligation or liability, and is not conditional or contingent upon
the
pursuit of any remedies
against Borrower, or any other Net Worth Guarantor or any other person, or
against any collateral
or liens held by Lender.
The
foregoing shall in no way limit or impair the enforcement against the Borrower,
Project
or any other collateral security granted by the Loan Documents of any of the
Lender's rights and remedies
pursuant to the Loan Documents.
"Borrower
Party"
means,
collectively, Borrower, Operating Lessee, Manager, Asset Manager,
Principal, Net Worth Guarantors and each of their agents and
Affiliates.
2. Waivers. To
the
fullest extent permitted by applicable law, each Net Worth Guarantor
waives all rights and defenses of sureties, guarantors, accommodation parties
and/or co-makers and
agrees that its obligations under this Joinder shall be direct, primary,
absolute and unconditional and that its obligations under this Joinder shall
be
unaffected by any of such rights or defenses, including,
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(a)
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Any
rights which it may have to require that (1) Lender first proceed
against
Borrower,
any other Net Worth Guarantor or any other person or entity with
respect
to the Retained Liabilities or (2) Lender first proceed against
any
collateral
held by Lender or (3) any party to be joined in any proceeding
to
enforce
the Retained Liabilities;
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(b)
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The
incapacity, lack of authority, death or disability of Borrower,
any Net
Worth Guarantor
or any other person or entity;
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(c)
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The
failure of Lender to commence an action against Borrower or any
other
person
or entity or to proceed against or exhaust any security held by
Lender at
any
time or to pursue any other remedy whatsoever at any
time;
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(d)
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Any
duty on the part of Lender to disclose to any Net Worth Guarantor
any
facts it
may now or hereafter know regarding Borrower regardless of whether
Lender
has reason to believe that any such facts materially increase the
risk
beyond that which
any Net Worth Guarantor intends to assume or has reason to believe
that
such
facts are unknown to any Net Worth Guarantor, each Net Worth Guarantor
acknowledging
that it is fully responsible for being and keeping informed of
the
financial
condition and affairs of
Borrower;
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(e)
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Lack
of notice of default, demand of performance or notice of acceleration
to
Borrower,
any other person or entity with respect to the Loan or the Retained
Liabilities;
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(f)
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The
consideration for this Supplemental Limited
Joinder;
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(g)
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Any
acts or omissions of Lender which vary, increase or decrease the
risk on
any Net Worth Guarantor;
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(h)
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Any
statute of limitations affecting the liability of any Net Worth
Guarantor
hereunder,
the liability of Borrower or any guarantor under the Loan Documents,
or
the enforcement hereof, to the extent permitted by
law;
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(i)
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The
application by Borrower of the proceeds of the Loan for purposes
other
than the
purposes represented by Borrower to Lender or intended or understood
by
Lender
or any Net Worth Guarantor;
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(j)
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An
election of remedies by Lender, including any election to proceed
against
any collateral
by judicial or non-judicial foreclosure, whether real property
or
personal
property, or by deed in lieu thereof, and whether or not every
aspect of
any
foreclosure sale is commercially reasonable, and whether or not
any such
election of remedies destroys or otherwise impairs the subrogation
rights
of any Net
Worth Guarantor or the rights of any Net Worth Guarantor to proceed
against
Borrower or any guarantor for reimbursement, or
both;
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(k)
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Any
statute or rule of law which provides that the obligation of a
surety must
be neither
larger in amount nor in any other aspects more burdensome than
that of a
Net
Worth Guarantor;
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(1)
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Any
rights to enforce any remedy which Lender may have against Borrower,
any
rights
to participate in any security for the Loan and any rights of indemnity,
reimbursement, contribution or subrogation which any Net Worth
Guarantor
may have
against Borrower or any other Net Worth Guarantor or
Person;
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(m)
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Lender's
election, in any proceeding instituted under the Federal Bankruptcy
Code,
of the application of Section 1111 (b)(2) of the Federal Bankruptcy
Code
or any
successor statute; and
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(n)
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Any
borrowing or any grant of a security interest under Section 364
of the
Federal
Bankruptcy Code.
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3. Consents
and Releases. Each
Net Worth Guarantor hereby consents and agrees that
Lender may at any time, and from time to time, without notice to or further
consent from any Net Worth
Guarantor and either with or without consideration do any one or more of the
following, all without
affecting the agreements contained herein or the liability of any Net Worth
Guarantor for the Retained
Liabilities: (a) surrender without substitution any property or other collateral
of any kind or nature
whatsoever held by it, or by any person, firm or corporation on its behalf
or
for its account, securing
the Loan or the Retained Liabilities; (b) modify the terms of any document
evidencing, securing or
setting forth the terms of the Loan; (c) grant releases, compromises and
indulgences with respect to the Loan
or
the Retained Liabilities or any persons or entities now or hereafter liable
thereon; or (d) take or fail
to
take any action of any type whatsoever with respect to the Loan or the Retained
Liabilities; (e)
release any Net Worth Guarantor hereunder; or (f) enforce this Supplemental
Limited Joinder in separate
actions against one or more of the Net Worth Guarantors, or by an action against
some or all of the Net Worth Guarantors, or any combination of the foregoing.
To
the maximum extent permitted by law,
each
Net Worth Guarantor knowingly, voluntarily and intentionally agrees to be bound
by the provisions of Article
3
of the
Loan Agreement (solely with respect to providing financial information
with
respect to themselves), Section 4.2(m) of the Loan Agreement and
Article
11
of the
Loan Agreement,
including, without limitation, the waiver of the right to a trial by jury in
Section
11.2,
and the
consents to jurisdiction and the governing law of Illinois set forth in
Sections
11.3,
and
11.4,
respectively.
4. Successors
and Assigns. Subject
to the restrictions on transfer and assignment contained
in Section
4.2(b)
of the
Loan Agreement, this Supplemental Limited Joinder shall be binding on
Hersha
Hospitality Limited Partnership and Mystic Hotel Investors, LLC, as applicable,
and their respective
heirs, successors and permitted assigns.
5. Enforcement. Lender's
right to enforce this Supplemental Limited Joinder against
Net Worth Guarantors shall be subject to the terms and conditions relating
to
enforcement set forth
in
Section
4.4(b)
of the
Loan Agreement.
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Executed
as of February _____,
2006
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NET
WORTH GUARANTORS:
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HERSHA
HOSPITALITY LIMITED
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PARTNERSHIP,
a Virginia limited partnership
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By:
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/s/
Xxxxxx X. Xxxxxx
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Name:
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Xxxxxx
X. Xxxxxx
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Address:
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Tax
ID #:
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00-0000000
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MYSTIC
HOTEL INVESTORS, LLC, a Delaware
limited
liability company
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By:
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Name:
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Address:
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Tax
ID #:
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Executed
as of February _____,
2006
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NET
WORTH GUARANTORS:
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HERSHA
HOSPITALITY LIMITED
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PARTNERSHIP,
a Virginia limited partnership
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By:
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Name:
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Address:
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Tax
ID #:
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MYSTIC
HOTEL INVESTORS, LLC, a Delaware
limited
liability company
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By:
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/s/
Xxxxx X. Xxxxx
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Name:
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Xxxxx
X. Xxxxx
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Address:
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000
Xxxxxxxx Xxxxxxxx
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Xxxxxxxxx,
XX 00000
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Tax
ID #:
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00-0000000
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Signature
Page to Supplemental Limited Joinder
