Exhibit 10.6
INDEMNIFICATION AND SEPARATION AGREEMENT
INDEMNIFICATION AND SEPARATION AGREEMENT (this "Agreement"), dated June
__ 2004, between Strategic Hotel Capital, L.L.C., a Delaware limited liability
company ("SHC LLC"), and Strategic Hotel Funding, L.L.C., a Delaware limited
liability company ("SHC Funding").
RECITALS
WHEREAS, the Board of Managers of SHC LLC has determined that it is in
the best interests of SHC LLC and its members to complete an initial public
offering (the "IPO") of shares of Strategic Hotel Capital, Inc., a Maryland
corporation ("SHC Inc."), which will be the managing member of SHC Funding;
WHEREAS, as a result of the IPO and the Formation and Structuring
Transactions (as defined below), SHC Funding will no longer be a wholly-owned
subsidiary of SHC LLC; and
WHEREAS, in connection with the foregoing, the parties desire to set
forth certain agreements regarding releases, indemnification and cooperation
following separation.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, SHC LLC and SHC Funding agree as follows:
ARTICLE I
DEFINITIONS
For the purpose of this Agreement the following capitalized terms shall
have the meanings specified herein.
"Action" means any demand, action, suit, countersuit, arbitration,
inquiry, proceeding or investigation by or before any federal, state, local,
foreign or international governmental authority or any arbitration or mediation
tribunal.
"Asset Management Agreement" shall mean that certain Asset Management
Agreement, dated the date hereof, between SHC LLC, as client, and SHC DTRS Inc.,
a subsidiary of SHC Funding, as manager.
"Commingled Claims" means, collectively, any Third Party Claim (i)
which involves any employee, officer, manager, consultant or agent that was
employed or engaged by both the SHC LLC Business and the SHC Funding Business,
(but excluding any employee, officer, manager, agent or consultant employed or
engaged by one of the Hotels, as defined below) and which is not primarily
attributable only to the SHC LLC Business, on the one hand, or only to the SHC
Funding Business on the other, or (ii) in which both SHC LLC and SHC Funding are
named and which is not primarily attributable only to the SHC LLC Business, on
the one hand, or only to the SHC Funding Business on the other, or (iii)
involving both the SHC LLC Business and the SHC Funding Business.
"Formation and Structuring Transactions" shall have the meanings
assigned thereto in the Registration Statement on Form S-11 filed by SHC Inc. in
connection with the IPO.
"Funding Hotels" shall mean the Hotels listed under the definition "SHC
Funding Business."
"Funding Liability" shall mean a Liability relating to, arising out of
or in connection with (i) the ownership, business or operations of the Funding
Hotels (or any of them), whether arising before or after the effective date of
the Formation and Structuring Transactions, (ii) the Formation and Structuring
Transactions, including the IPO or (iii) wages, compensation and benefits owed
to employees of SHC LLC or any of its subsidiaries who are or become employees
of any member of the SHC Funding Group in connection with the Formation and
Structuring Transactions.
"Hotel" shall mean one of the hotel properties listed under the
definitions of the SHC Funding Business or the SHC LLC Business.
"Indemnifying Party" has the meaning set forth in Section 2.5(a)
hereof.
"Indemnitee" has the meaning set forth in Section 2.5(a) hereof.
"Information" means information, in written, oral, electronic or other
tangible or intangible forms, stored in any medium, including studies, reports,
records, books, contracts, instruments, computer data, disks, diskettes, tapes,
computer programs or other technical, financial, employee or business
information or data.
"Intercompany Agreements" has the meaning set forth in Section 2.1(c)
hereof.
"IPO Closing Date" shall mean the date on which shares of common stock
of SHC Inc. are issued pursuant to the IPO.
"Liabilities" means all debts, liabilities, guarantees, assurances,
commitments and obligations, whether fixed, contingent or absolute, asserted or
unasserted, matured or unmatured, liquidated or un-liquidated, accrued or not
accrued, known or unknown, due or to become due, whenever or however arising
(including, without limitation, whether arising out of any contract or tort
based on negligence or strict liability) and whether or not the same would be
required by generally accepted accounting principles and accounting policies to
be reflected in financial statements or disclosed in the notes thereto. For
purposes of any indemnification hereunder, "Liabilities" shall be deemed also to
include any and all damages, claims, suits, judgments, fines, penalties, costs
and expenses of any kind or character, including attorney's reasonable fees.
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"LLC Hotels" shall mean the Hotels listed under the definition "SHC LLC
Business."
"LLC Liability" shall mean a Liability relating to, arising out of or
in connection with (i) the ownership, business or operations of the LLC Hotels
(or any of them), whether arising before or after the date of the Formation and
Structuring Transactions, or (ii) any other Liability of the SHC LLC Group or
the SHC Funding Group which relates to acts or omissions of any such parties
prior to consummation of the Formation and Structuring Transactions (including
the IPO) and which is not a Funding Liability. For the avoidance of doubt, the
term LLC Liability shall include, without limitation, (i) any liabilities for
income taxes of SHC Funding and SHC LLC and their direct and indirect
subsidiaries relating to periods ending on or prior to the closing of the IPO,
but excluding any liabilities for income taxes associated with SHC Inc. or as a
result of the Formation and Structuring Transactions, which shall be a Funding
Liability and (ii) any liabilities (including contingent liabilities such as
indemnification obligations) of SHC Funding, SHC LLC and their respective direct
and indirect subsidiaries in connection with sales of hotel properties occurring
prior to the effective date of the Formation and Structuring Transactions;
provided, however, that the amount of the LLC Liability shall be reduced by (i)
any benefits or amounts that are received by the SHC Funding Group in respect of
any LLC Hotel or sale of hotel properties by SHC Funding, SHC LLC and their
respective direct and indirect subsidiaries that occurred prior to the effective
date of the Formation and Structuring Transactions (e.g., a deferred purchase
price, pro-rations, etc.) and (ii) insurance recoveries and any other amounts
that are received by the SHC Funding Group from third parties relating to,
arising out of or in connection with an LLC Liability.
"Management Agreement" shall mean, in relation to a Hotel, the
management agreement, operating agreement or lease pursuant to which the
business of the Hotel is conducted by a Manager.
"Manager" shall mean, with respect to a Hotel, the third party
conducting the operations of such Hotel pursuant to the terms of the Management
Agreement relating to such Hotel.
"SHC Funding Business" means: the business and operations of SHC
Funding and its partially and wholly-owned direct and indirect subsidiaries
after giving effect to the consummation of the Formation and Structuring
Transactions, including, without limitation, the ownership, business and
operations of the following hotel properties, whether conducted or occurring
prior to, on or after the effective date of the Formation and Structuring
Transactions:
(1) Hyatt Regency New Orleans;
(2) Hyatt Regency Phoenix;
(3) Hilton Burbank Airport and Convention Center;
(4) Marriott Rancho Las Palmas Resort;
(5) Hyatt Regency La Jolla at Aventine;
(6) Marriott Chicago Schaumburg;
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(7) Marriott Lincolnshire Resort;
(8) Inter.Continental Prague;
(9) Loews Santa Xxxxxx Beach Hotel;
(10) Embassy Suites Lake Buena Vista Resort;
(11) Marriott Hamburg;
(12) Four Seasons Mexico City;
(13) Paris Marriott Champs Elysees; and
(14) Four Seasons Punta Mita Resort.
"SHC Funding Group" or "SHC Indemnitees" means SHC Funding and its
partially and wholly-owned direct and indirect subsidiaries and their respective
members, managers, officers and employees after giving effect to the Formation
and Structuring Transactions.
"SHC LLC Business" means the business and operations of SHC LLC and its
partially or wholly-owned direct or indirect subsidiaries (other than members of
the SHC Funding Group) after giving effect to the consummation of the Formation
and Structuring Transactions; including, without limitation, the ownership,
business and operations of the following hotel properties, whether conducted or
occurring prior to, on or after the effective date of the Formation and
Structuring Transactions:
(1) The Essex House, a Westin Hotel;
(2) Marriott New York East Side;
(3) Loews Xxxxxxx Hills;
(4) Westin Santa Xxxxx;
(5) Hyatt Regency San Francisco;
(6) Park Hyatt San Francisco; and
(7) Xxxx-Xxxxxxx, Laguna Niguel.
"SHC LLC Group" or "SHC LLC Indemnitees" means SHC LLC and its wholly-
and partially-owned direct and indirect subsidiaries (other than members of the
SHC Funding Group) and their respective members, managers, officers and
employees after giving effect to the transactions contemplated by the Formation
and Structuring Transactions.
"Third Party Claim" has the meaning set forth in Section 2.5(a) of this
Agreement.
ARTICLE II
MUTUAL RELEASES; INDEMNIFICATION
Section 2.1 Release of Pre-Closing Claims.
(a) SHC Funding Release. Except as provided in Section 2.1(c) and
Section 2.4, effective as of the IPO Closing Date, SHC Funding does hereby, for
itself and as agent for each member of the SHC Funding Group, release and
forever discharge the SHC LLC Indemnitees from any and all Liabilities
whatsoever related to, arising from or in connection with the SHC Funding
Business (whether arising at law or in equity (including any right of
contribution), and whether arising under any contract or agreement, by operation
of law or otherwise), existing or arising from any acts or events occurring or
failing to occur or alleged to have occurred or to have failed to occur or any
conditions existing or alleged to have existed on or before the IPO Closing
Date, including, without limitation, any such acts, events or conditions on or
before the IPO Closing Date in connection with the Formation and Structuring
Transactions, including the IPO.
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(b) SHC LLC Release. Except as provided in Section 2.1(c) and Section 2.4,
effective as of the IPO Closing Date, SHC LLC does hereby, for itself and as
agent for each member of the SHC LLC Group, release and forever discharge the
SHC Funding Indemnitees from any and all Liabilities whatsoever related to,
arising from or in connection with the SHC LLC Business (whether arising at law
or in equity (including any right of contribution), whether arising under any
contract or agreement, by operation of law or otherwise) existing or arising
from any acts or events occurring or failing to occur or alleged to have
occurred or to have failed to occur or any conditions existing or alleged to
have existed on or before the IPO Closing Date, other than wages, compensation
and benefits owed to employees of SHC LLC or any of its subsidiaries who are or
become employees of any member of the SHC Funding Group in connection with the
Formation and Structuring Transactions.
(c) Excluded Liabilities; No Impairment. Nothing contained in Section
2.1(a) or (b) shall release any claims under, or impair any right of any person
to enforce the Asset Management Agreement or this Agreement (the "Intercompany
Agreements").
(d) No Actions as to Released Claims. SHC Funding agrees, for itself
and as agent for each member of the SHC Funding Group, not to make any claim or
demand, or commence any Action asserting any claim or demand, including any
claim of contribution or any indemnification, against SHC LLC or any other
person released pursuant to Section 2.1(a), with respect to any Liabilities
released pursuant to Section 2.1(a). SHC LLC agrees, for itself and as agent for
each member of the SHC LLC Group, not to make any claim or demand, or commence
any Action asserting any claim or demand, including any claim of contribution or
any indemnification, against SHC Funding or any other person released pursuant
to Section 2.1 (b), with respect to any Liabilities released pursuant to Section
2.1(b).
Section 2.2 Indemnification by SHC Funding. Except as otherwise
provided in this Agreement, SHC Funding shall indemnify, defend and hold
harmless the SHC LLC Indemnitees from and against any and all Liabilities that
any third party seeks to impose upon the SHC LLC Indemnitees, or which are
imposed upon the SHC LLC Indemnitees, if and to the extent such Liabilities
relate to, arise out of or result from any of the following items (without
duplication):
(i) subject to Section 2.4, the SHC Funding Business or the
Formation and Structuring Transactions, including the IPO;
(ii) any breach by any member of the SHC Funding Group of the
Intercompany Agreements; and
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(iii) subject to Section 2.4, any Liabilities of the SHC
Funding Group (other than those included in the definition of LLC
Liability).
In the event that any member of the SHC Funding Group makes a payment
to the SHC LLC Indemnitees hereunder, and any of the SHC LLC Indemnitees
subsequently diminishes the Liabilities on account of which such payment was
made, either directly or through a third-party recovery, SHC LLC will promptly
repay (or will procure an SHC LLC Indemnitee to promptly repay) such member of
the SHC Funding Group the amount by which the payment made by such member of the
SHC Funding Group exceeds the actual cost to the SHC LLC Indemnitee of the
associated indemnified Liability; provided, however, that in the event that any
indemnified Liability that was diminished is subsequently reinstated such that
the net amount paid by such member of the SHC Funding Group is less than the
amount of the reinstated Liability, such member of the SHC Funding Group shall
pay the difference to SHC LLC or the SHC LLC Indemnitee, as applicable.
Section 2.3 Indemnification by SHC LLC. Except as otherwise provided in this
Agreement, SHC LLC shall indemnify, defend and hold harmless the SHC Funding
Indemnitees from and against any and all Liabilities that any third party seeks
to impose upon the SHC Funding Indemnitees, or which are imposed upon the SHC
Funding Indemnitees, if and to the extent such Liabilities relate to, arise out
of or result from any of the following items (without duplication):
(i) subject to Section 2.4, the SHC LLC Business;
(ii) any breach by any member of the SHC LLC Group of the
Intercompany Agreements; and
(iii) subject to Section 2.4, any Liabilities of the SHC LLC
Group (other than those included in the definition of Funding
Liability).
In the event that any member of the SHC LLC Group makes a payment to
the SHC Funding Indemnitees hereunder, and any of the SHC Funding Indemnitees
subsequently diminishes the Liabilities on account of which such payment was
made, either directly or through a third-party recovery, SHC Funding will
promptly repay (or will procure an SHC Funding Indemnitee to promptly repay)
such member of the SHC LLC Group the amount by which the payment made by such
member of the SHC LLC Group exceeds the actual cost to the SHC Funding
Indemnitee of the indemnified Liability; provided, however, that in the event
that any indemnified Liability that was diminished is subsequently reinstated
such that the net amount paid by such member of the SHC LLC Group is less than
the amount of the reinstated Liability, such member of the SHC LLC Group shall
pay the difference to SHC Funding or the SHC Funding Indemnitee, as applicable.
Section 2.4 Indemnification of Specific Claims; Allocation of
Liabilities. Notwithstanding anything herein to the contrary:
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(a) Indemnification by SHC Funding. SHC Funding shall indemnify, defend
and hold harmless the SHC LLC Indemnitees from and against any and all
Liabilities that any third party seeks to impose upon the SHC LLC Indemnitees,
or which are imposed upon the SHC LLC Indemnitees, if and to the extent such
Liabilities relate to, arise out of or result from any of the following
agreements (collectively, the "Guarantees"):
(i) the Joint and Several Accessory Guarantees, dated July 10,
2003, by SHC LLC in favor of Deutsche Immobilien Fonds
Aktiengesellschaft ("DFMA") relating to the Paris Marriott Champs
Elysees and dated December 16, 2003 by SHC LLC in favor of DFMA
relating to the Hamburg Marriott;
(ii) the Guarantee, dated June 26, 2003, by SHC LLC in favor
of Aareal Bank AG relating to the Inter.Continental Prague;
(iii) the Guarantee, dated June 14, 2000, by SHC LLC in favor
of Marriott Hotel Management GmbH and its affiliates relating to the
lease agreement for the Marriott Hamburg;
(iv) the Guarantee, dated August 24, 1998, by SHC LLC included
in the Management Agreement, dated August 24, 1998, between SHC Burbank
LLC and Hilton Hotels Corporation relating to the obligations of SHC
Burbank LLC under that management agreement;
(v) the Guarantee, dated September 30, 1997, by SHC LLC in
favor of Promus Hotels Florida, Inc. relating to SHC Funding's
agreement to purchase Embassy Suites Lake Buena Vista;
(vi) the Guaranty, dated January 22, 1998, by SHC LLC in favor
of Marriott International, Inc. and Marriott Hotel Services Inc.
relating to the purchase and management of Marriott Rancho Las Palmas
Resort, as amended by that Amendment of Guaranties dated as of January
1, 2000;
(vii) the Guaranty of Management Agreement, dated March 4,
1998, by SHC LLC in favor of Loews Santa Xxxxxx Hotel, Inc. related to
the management of Loews Santa Xxxxxx Beach Hotel;
(viii) any guarantee related to the Westward Look Hotel in
Tucson Arizona;
(ix) any other guaranties or indemnification obligations
granted to third parties relating to the Funding Hotels.
(b) Release. Following the date hereof, SHC Funding will use its
reasonable best efforts to obtain a complete release of SHC LLC (and all other
members of the SHC LLC Group if applicable) from all liabilities and obligations
under the Guarantees. The release relating to such guarantees shall be in form
and substance reasonably satisfactory to SHC LLC; provided, however, that SHC
Funding shall not be required to spend more than a nominal amount of its own
funds to obtain such release.
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(c) Indemnification by SHC LLC. SHC LLC shall indemnify, defend and
hold harmless the SHC Funding Indemnitees from and against any and all
Liabilities that any third party seeks to impose upon the SHC Funding
Indemnitees, or which are imposed upon the SHC Funding Indemnitees, if and to
the extent such Liabilities relate to, arise out of or result from the matters
described in Schedule 2.4.
(d) Allocation of Liabilities and Cooperation. In connection with the
Formation and Structuring Transactions and this Agreement, the parties hereto
shall use commercially reasonable good faith efforts to account for the assets
and liabilities of the SHC Funding Group and the SHC LLC Group in a usual and
customary fashion (including by allocating to each of such entities appropriate
levels of cash to meet ordinary course obligations) and to allocate among the
members of the SHC Funding Group and the SHC LLC Group assets and liabilities as
of the IPO Closing Date which are Funding Liabilities or LLC Liabilities or
which are allocable to the SHC LLC Business or the SHC Funding Business in
accordance with the terms of this Agreement and other agreements relating to the
Formation and Structuring Transactions. The parties will use reasonable and
customary methods of allocating such assets (including cash) and liabilities
among the entities comprising the SHC Funding Group and the SHC LLC Group to
carry out the purposes and intent of this Agreement and the Formation and
Structuring Transactions. The agreement to allocate liabilities shall include an
assumption by the appropriate parties of accrued liabilities which are to be
borne by a particular party pursuant to this Agreement and the Formation and
Structuring Transactions. The parties hereto shall reasonably cooperate with
respect to claims and liabilities relating to insurance, tax and employee
benefits matters including with respect to any claims which relate to periods
ending on or prior to the IPO Closing Date so that any such claims and
liabilities are properly allocated in accordance with this Agreement.
(e) Limitations on Indemnification. In determining indemnification
payments pursuant to this Section 2.4, the parties shall make appropriate
adjustments for recovery of tax benefits and insurance coverage. A party
entitled to indemnification pursuant to this Section 2.4 shall use its
commercially reasonable efforts to mitigate any damages for which it may be
entitled to indemnification hereunder. If each party owes an amount to the
other, the two amounts shall be offset and netted against each other and only
the net amount shall be paid.
Section 2.5 Procedures for Defense, Settlement and Indemnification of
Third Party Claims.
(a) Notice of Claims. If an SHC LLC Indemnitee or an SHC Funding
Indemnitee, as applicable (an "Indemnitee"), receives notice or otherwise learns
of the assertion by a person (including any regulatory authority) who is not a
member of the SHC LLC Group or the SHC Funding Group of any claim or of the
commencement by any such person of any Action (collectively, a "Third Party
Claim") with respect to which a party (an "Indemnifying Party") may be obligated
to provide indemnification to such Indemnitee pursuant to Section 2.2, 2.3 or
2.4, SHC LLC and SHC Funding, as applicable, will ensure that such Indemnitee
shall give such Indemnifying Party written notice thereof within thirty (30)
days after becoming aware of such Third Party Claim. Any such notice shall
describe the Third Party Claim in reasonable detail. Notwithstanding the
foregoing, the delay or failure of any Indemnitee or other person to give notice
as provided in this Section 2.5(a) shall not relieve the related Indemnifying
Party of its obligations under this Article II, except to the extent that such
Indemnifying Party is actually and substantially prejudiced by such delay or
failure to give notice.
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(b) Defense of Claims. Other than in the case of a Commingled Claim, an
Indemnifying Party shall manage the defense of and may settle or compromise any
Third Party Claim so long as such settlement or compromise contains a full and
unconditional release of each Indemnified Party. Within thirty (30) days after
the receipt of notice from an Indemnitee in accordance with Section 2.5(a) (or
sooner, if the nature of such Third Party Claim so requires), the Indemnifying
Party shall notify the Indemnitee that the Indemnifying Party will assume
responsibility for managing the defense of such Third Party Claim. With respect
to any Commingled Claim, the parties (i) shall determine which party shall
manage the defense of, and may seek to settle or compromise, such Commingled
Claim based upon the specific facts of such claim, and (ii) agree to cooperate
fully and maintain a joint defense (in a manner that will preserve the
attorney-client privilege with respect thereto) so as to minimize such
Liabilities and defense costs associated therewith.
(c) Defense By Indemnitee. If an Indemnifying Party fails to assume
responsibility for managing the defense of a Third Party Claim or to diligently
defend such Third Party Claim, or fails to notify an Indemnitee that it will
assume responsibility as provided in Section 2.5(b), such Indemnitee may manage
the defense of such Third Party Claim and may settle such Third Party Claim
without the consent of the Indemnifying Party.
(d) No Settlement By Indemnitee Without Consent. Unless the
Indemnifying Party has failed to manage the defense of the Third Party Claim in
accordance with the terms of this Agreement, or has failed to notify an
Indemnitee that it will assume responsibility as provided in Section 2.5(b), no
Indemnitee may settle or compromise any Third Party Claim without the consent of
the Indemnifying Party.
Section 2.6 Additional Matters Regarding Indemnification.
(a) Substitution. In the event of an Action in which the Indemnifying
Party is not a named defendant, if either the Indemnitee or the Indemnifying
Party shall so request, the parties shall endeavor to substitute the
Indemnifying Party for the named defendant. If such substitution or addition
cannot be achieved for any reason or is not requested, the rights and
obligations of the parties regarding indemnification and the management of the
defense of claims as set forth in this Article II shall not be altered.
(b) Subrogation. In the event of payment by or on behalf of any
Indemnifying Party to or on behalf of any Indemnitee in connection with any
Third Party Claim, such Indemnifying Party shall be subrogated to and shall
stand in the place of such Indemnitee, in whole or in part based upon whether
the Indemnifying Party has paid all or only part of the Indemnitee's Liability,
as to any events or circumstances in respect of which such Indemnitee may have
any right, defense or claim relating to such Third Party Claim against any
claimant or plaintiff asserting such Third Party Claim or against any other
person. Such Indemnitee shall cooperate with such Indemnifying Party in a
reasonable manner, and at the cost and expense of such Indemnifying Party, in
prosecuting any subrogated right, defense or claim.
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Section 2.7 Survival of Indemnities. The rights and obligations of SHC
LLC and SHC Funding under this Article II shall survive the sale or other
transfer by any party of any assets or businesses or the assignment by it of any
Liabilities or the sale by any member of the SHC LLC Group or the SHC Funding
Group of the capital stock or other equity interests of any subsidiary to any
person.
Section 2.8 Agreement For Exchange of Information. Subject to
applicable confidentiality restrictions and subject to providing the
contemplated Information only to those persons who require such Information in
the course of their duties, each of SHC LLC and SHC Funding agree to provide, or
cause to be provided, to each other, at any time after the IPO Closing Date, as
soon as reasonably practicable after written request therefor, any Information
in the possession or under the control of such party that the requesting party
reasonably needs:
(a) to comply with reporting, disclosure, filing or other requirements
imposed on the requesting party by a regulatory authority having jurisdiction
over the requesting party or otherwise required by law;
(b) for use in any regulatory proceeding, judicial proceeding or other
proceeding or in order to satisfy audit, accounting, claims, regulatory,
litigation or other similar requirements;
(c) to comply with its obligations under this Agreement; or
(d) in connection with the ongoing businesses of SHC LLC or SHC Funding
as it relates to the conduct of such businesses, as the case may be;
provided, however, that in the event that either party determines that any such
provision of Information could be commercially detrimental, violate any
applicable law or agreement, or waive any attorney-client privilege, the parties
shall take all reasonable measures to permit the compliance with such
obligations in a manner that avoids any such harm or consequence.
Section 2.9 Other Agreements. SHC LLC and SHC Funding agree to execute
and deliver, or to use their reasonable commercial efforts to cause to be
executed and delivered by the appropriate parties, such other agreements,
instruments and other documents as may be necessary or desirable in order to
effect the purposes of this Agreement and the Formation and Structuring
Transactions. The parties shall cooperate reasonably with each other in
connection with any steps required to be taken as part of their respective
obligations under this Agreement and the Formation and Structuring Transactions,
and shall (a) furnish upon request to each other such further information; and
(b) do such other acts and things, all as the other party may reasonably request
for the purpose of carrying out the intent of this Agreement and the Formation
and Restructuring Transactions.
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ARTICLE III
MISCELLANEOUS
Section 3.1 Entire Agreement. This Agreement, and the Schedules
attached hereto, constitute the entire agreement between the parties with
respect to the subject matter hereof and shall supersede all prior written and
oral and all contemporaneous oral agreements and understandings with respect to
the subject matter hereof.
Section 3.2 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
Section 3.3 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given when delivered
in person, by telecopy with answer back, by express or overnight mail delivered
by a nationally recognized air courier (delivery charges prepaid), or by
registered or certified mail (postage prepaid, return receipt requested) as
follows:
if to SHC LLC:
Strategic Hotel Capital, L.L.C.
c/o Goldman, Xxxxx & Co.
000 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxxxxx
Facsimile: (000) 000-0000
and
Strategic Hotel Capital, L.L.C.
c/o Prudential Investments
0 Xxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxx Xxxxxx
Facsimile: (000) 000-0000
if to SHC Funding:
c/o Strategic Hotel Capital, Inc.
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn.: General Counsel
Facsimile: (000) 000-0000
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or to such other address as the party to whom notice is given may have
previously furnished to the other in writing in the manner set forth above. Any
notice or communication delivered in person shall be deemed effective on
delivery. Any notice or communication sent by telecopy or by overnight air
courier shall be deemed effective on the first Business Day following the day on
which such notice or communication was sent. Any notice or communication sent by
registered or certified mail shall be deemed effective on the third Business Day
following the day on which such notice or communication was mailed. As used in
this Section 3.3, "Business Day" means any day other than a Saturday, a Sunday
or a day on which banking institutions located in the State of New York are
authorized or obligated by law or executive order to close.
Section 3.4 Parties in Interest. This Agreement and the other documents
referred to herein, shall be binding upon SHC LLC and SHC Funding and inure
solely to the benefit of the SHC Funding Indemnitees and the SHC LLC Indemnitees
and their respective permitted assigns, and nothing in this Agreement, express
or implied, is intended to confer upon any other person any rights or remedies
of any nature whatsoever under or by reason of this Agreement.
Section 3.5 Counterparts. This Agreement and the other documents
referred to herein, may be executed in counterparts, each of which shall be
deemed to be an original but all of which shall constitute one and the same
agreement.
Section 3.6 Assignment. The rights and obligations in this Agreement
may not be assigned or delegated by any party hereto, in whole or in part,
without the express prior written consent of the other party hereto.
Section 3.7 Severability. If any term or other provision of this
Agreement is determined by a nonappealable decision by a court, administrative
agency or arbitrator to be invalid, illegal or incapable of being enforced by
any rule of law or public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner materially adverse to any party. Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner to the end that transactions contemplated
hereby are fulfilled to the fullest extent possible.
Section 3.8 Failure or Indulgence Not Waiver. No failure or delay on
the part of either party hereto in the exercise of any right hereunder shall
impair such right or be construed to be a waiver of, or acquiescence in, any
breach of any representation, warranty or agreement herein, nor shall any single
or partial exercise of any such right preclude other or further exercise thereof
or of any other right.
Section 3.9 Amendment. No change or amendment will be made to this
Agreement except by an instrument in writing signed on behalf of each of the
parties to this Agreement.
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Section 3.10 Interpretation. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. When a reference is made in this Agreement to
an Article or a Section, such reference shall be to an Article or Section of
this Agreement unless otherwise indicated.
[signature pages follow]
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WHEREFORE, the parties have signed this Agreement effective as of the date first
set forth above.
STRATEGIC HOTEL CAPITAL, L.L.C. STRATEGIC HOTEL FUNDING, L.L.C.
By: By:
--------------------------------- ------------------------------
Name: Name:
Title: Title:
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