Exhibit 10.5
May 8, 2000
Apple Suites, Inc.
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxx X. Xxxxxx
Re: Agreement of Sale dated November 22, 1999 by
and between the undersigned and you (the
"Agreement"; capitalized terms not otherwise
defined herein have the meanings ascribed to
them in the Agreement)
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Gentlemen:
We hereby agree that the Outside Closing Date shall be
extended to May 9, 2000 and, if you or your wholly-owned subsidiary acquires the
property located in Malvern, Pennsylvania pursuant to the Agreement of Sale on
or before May 9, 2000, the Outside Closing Date shall be further extended to
June 30, 2000.
We hereby further agree that, notwithstanding anything to the contrary in (i)
the notes (collectively, the "Notes") dated September 20, 1999, October 5, 1999,
November 29, 1999 and December 22, 1999 in the aggregate principal amount of
$68,569,500 and, if the closing occurs with respect to the property located in
Malvern, Pennsylvania pursuant to the Agreement, the $11,616,750 note to be
executed in connection therewith or (ii) the Agreement and for so long as no
Event of Default exists under the mortgages, deeds of trust, deed to secure debt
and like instruments securing the Notes and such new note, Buyer shall be
permitted to retain and invest the Net Equity Proceeds that otherwise are
required to be paid to Promus to be applied to the payment of principal of the
Notes and such new note (the "Retained Amounts"), until such time as the
remaining two (2) properties the subject of the Agreement (each, a "Remaining
Property" and, collectively, the "Remaining Properties") close, at which time,
in the case of the first closing, a portion of the Retained Amounts equal to 25%
of the purchase price of the Malvern property shall be applied in respect of
such purchase price and, in the case of the last Remaining Property to close,
the sum of (a) a portion of the Retained Amounts equal to 25% of the purchase
price of such last Remaining Property plus (b) after application pursuant to
clause (a), all then remaining Retained Amounts in excess of $1,500,000 or such
higher amount as is agreed to by us (such $1,500,000 or higher amount, the
"Closing Costs Amount") shall be applied in respect of the purchase price of
such Remaining Property; provided, however, that upon the sale of the last
Remaining
Property, if the purchase price of such last Remaining Property is paid in full
from such Retained Amounts, the balance of any then remaining Retained Amounts
in excess of the Closing Costs Amount shall be applied in reduction of the
outstanding principal balance of the Notes and such new note and, provided,
further, however, that if, on or before May 9, 2000, the property located in
Malvern, Pennsylvania has not been purchased by Buyer in accordance with the
Agreement or if, on or before June 30, 2000, the property located in Boulder,
Colorado has not then been purchased by Buyer in accordance with the Agreement,
the "Amortization Amount", as defined in the Notes, shall be due and payable,
except that Buyer shall be permitted, subject to the provisions of the
immediately succeeding sentence, to retain and invest the Closing Costs Amount,
which shall thus not constitute a portion of the Amortization Amount. If the
refinancing described in that certain letter agreement of even date herewith
between you and Promus Hotels, Inc. occurs on or before September 30, 2000, the
Closing Costs Amount shall be applied in respect of closing costs incurred in
connection with the closing of such refinancing with any excess applied in
reduction of any notes from Buyer then held by us or if such refinancing does
not occur on or before September 30, 2000, the Closing Costs Amount shall be
applied in reduction of the outstanding principal balance of the Notes and such
new notes. Except as expressly set forth herein, the Notes shall continue in
full force and effect, binding upon Buyer in favor of Promus.
If either or both of the Remaining Properties close, the
maturity date of the note or notes executed in connection with the purchase
money financing provided by Promus Hotels, Inc. shall be April 28, 2001.
If you are in agreement with the foregoing, please sign in the
space provided below.
This letter agreement may be executed in one or more
counterparts, each of which shall be deemed an original. Said counterparts shall
constitute but one and the same instrument and shall be binding upon each of the
parties hereto individually as fully and completely as if all had signed but one
instrument and shall be unaffected by the failure of any party hereto to execute
any or all of said counterparts.
Very truly yours,
HAMPTON INNS, INC. , successor-by-
merger to Homewood Suites Equity
Development Corp.
By /s/ Xxxxxx X. Xxxxxx
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Name:
Title:
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PROMUS HOTELS FLORIDA, INC.
By /s/ Xxxxxx X. Xxxxxx
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Name:
Title:
PROMUS HOTELS, INC.
By /s/ Xxxxxx X. Xxxxxx
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Name:
Title:
Accepted and agreed to this 8th
day of May, 2000.
APPLE SUITES, INC., a
Virginia corporation
By /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Chairman of the Board and President
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