THIRD AMENDMENT TO MORTGAGE LOAN AND SECURITY AGREEMENT Between SHC MICHIGAN AVENUE, LLC as Borrower and CITIGROUP GLOBAL MARKETS REALTY CORP., as Lender Dated: As of August 31, 2007
Exhibit
99.2
THIRD
AMENDMENT TO MORTGAGE LOAN AND SECURITY AGREEMENT
Between
SHC
MICHIGAN AVENUE, LLC
as
Borrower
and
CITIGROUP
GLOBAL MARKETS REALTY CORP.,
as
Lender
Dated: As
of August 31, 2007
THIRD
AMENDMENT TO MORTGAGE LOAN AND SECURITY
AGREEMENT
THIS
THIRD AMENDMENT TO MORTGAGE LOAN AND SECURITY AGREEMENT, dated as of August
31,
2007 (this “Agreement”) between SHC MICHIGAN
AVENUE, LLC a Delaware limited liability company (“Borrower”), having an
office at c/o Strategic Hotel Funding, L.L.C., 00 Xxxx Xxxxxx Xxxxx, Xxxxx
0000, Xxxxxxx, Xxxxxxxx 00000 and after September 15, 2007, 000 Xxxx Xxxxxxx
Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, and CITIGROUP GLOBAL MARKETS REALTY
CORP., a New York corporation, having an address at 000 Xxxxxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000 (together with its successors and assigns,
“Lender”).
W
I T
N E S S E T H :
WHEREAS,
Lender and Borrower are parties to that certain Loan and Security Agreement
dated as of October 6, 2006, by and between Borrower and Lender, as amended
by
that certain Amendment to Mortgage Loan and Security Agreement dated as of
October 20, 2006, and as further amended by that certain Second Amendment to
Mortgage Loan and Security Agreement dated as of May 9, 2007 (as so amended,
the
“Loan Agreement”). All capitalized terms not otherwise defined
herein shall have the respective meanings set forth in the Loan
Agreement;
WHEREAS,
Lender and Borrower desire to amend the Loan Agreement in the manner hereinafter
provided.
NOW,
THEREFORE, in consideration of the agreements set forth in this Agreement and
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, the parties hereby modify and amend the Loan Agreement,
as
follows:
1. The
definition of “Gift Shop Lease” is hereby deleted.
2. The
definitions of “Independent Director”, “Independent Manager”, or “Independent
Member” are hereby deleted and replaced with the following:
““Independent
Director”, “Independent Manager” or
“Independent Member” means a natural person who is
not at the
time of initial appointment as a director or at any time while serving as a
director, member or manager of the Borrower and has not been at any time during
the five (5) years preceding such initial appointment:
(a) a
stockholder, director, member or manager (with the exception of serving as
an
Independent Director Member or Manager of the Borower), officer, trustee,
employee, partner, member, attorney or counsel of Borrower, the Member (with
exception of serving as a Special Member), or any affiliate of either of
them;
(b) a
creditor, customer, supplier, or other person who derives any of its purchases
or revenues from its activities with the Member, the Borrower or any affiliate
of either of them;
(c) a
Person
Controlling or under common Control with any Person excluded from serving as
Independent Director, Member or Manager under (a) or (b); or
(d) a
member
of the immediate family by blood or marriage of any Person excluded from serving
as Independent Director, Member or Manager under (a) or (b).
A
natural
person who satisfies the foregoing definition other than subparagraph (b) shall
not be disqualified from serving as an Independent Director, Member or Manager
of the Borrower if such individual is an Independent Director, Member or Manager
provided by a nationally-recognized company that provides professional
independent directors (a “Professional Independent Director”)
and other corporate services in the ordinary course of its
business. A natural person who otherwise satisfies the foregoing
definition other than subparagraph (a) by reason of being the independent
director, member or manager of a “special purpose entity” affiliated with the
Borrower shall not be disqualified from serving as an Independent Director
Member or Manager of the Borrower if such individual is either (i) a
Professional Independent Director or (ii) the fees that such individual earns
from serving as independent director, member or manager of affiliates of the
Borrower in any given year constitute in the aggregate less than five percent
(5%) of such individual’s annual income for that
year. Notwithstanding the immediately preceding sentence, an
Independent Director, Member or Manager may not simultaneously serve as
Independent Director of the Borrower and independent director of a special
purpose entity that owns a direct or indirect equity interest in the Borrower
Company or a direct or indirect interest in any co-borrower with the
Borrower.”
3. The
definition of “Management Agreement” is hereby deleted and replaced with the
following:
““Management
Agreement” shall mean that certain Hotel Management Agreement dated
April 1, 2005 between IHG Management (Maryland), LLC and DTRS Michigan
Avenue/Chopin Plaza Sub, LLC and recorded as Document No. 0509727142 in the
Xxxx
County Records, as assigned to DTRS InterContinental Chicago, LLC pursuant
to
that Assignment and Assumption of Management Agreement and Manager Consent
dated
October 6, 2006, as further assigned to the Operating Lessee pursuant to that
Assignment and Assumption of Management Agreement and Manager Consent dated
the
date hereof, as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time in accordance with the terms
hereof”.
4. A
new
definition of “Material Action” is hereby inserted:
““Material
Action”
means to file any insolvency, or reorganization case or proceeding,
to institute
proceedings to have the relevant entity (“Entity”) be
adjudicated bankrupt or insolvent, to institute proceedings under any applicable
insolvency law, to seek any relief under any law relating to relief from debts
or the protection of debtors, to consent to the filing or institution of
bankruptcy or insolvency proceedings against the Entity, to file a petition
seeking, or consent to, reorganization or relief with respect to the Entity
under any applicable federal or state law relating to bankruptcy or insolvency,
to seek or consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator, custodian, or any similar official of or for the
Entity or a substantial part of its property, to make any assignment for the
benefit of creditors
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of
the
Entity, to admit in writing the Entity's inability to pay its debts generally
as
they become due, or to take action in furtherance of any of the
foregoing.”
5. The
definition of “Operating Lessee” is hereby amended by deleting “DTRS
InterContinental Chicago, LLC” and replacing with “New DTRS Michigan Avenue,
LLC”.
6. The
definition of “Single Purpose Entity” is hereby amended by:
(a) deleting
paragraphs (iii) and (iv) of this definition and replacing with:
“(iii) does
not and will not have any assets other than those related to its interest in
the
Property or the operation, management and financing thereof or any indebtedness
other than the Permitted Debt, (iv) maintains its own separate books and
records and its own accounts, in each case which are separate and apart from
the
books and records and accounts of any other Person (however the presentation
of
combined or consolidated financial condition or results of operation for
purposes of financial statements prepared for the ultimate equity owners of
multiple Single Purpose Entities shall be allowed, as provided
herein)”;
(b) amending
paragraph (xviii) by deleting “uses commercially reasonable efforts to”;
and
(c) amending
paragraph (4) of the last sentence of this definition by inserting “(except as
provided herein)” at the end of the paragraph.
7. The
definition of “Sponsor” is hereby deleted and replaced with the
following:
““Sponsor”
shall mean, SHC MICHIGAN AVENUE MEZZANINE II, LLC, a Delaware limited liability
company, which shall execute and deliver the Sponsor Indemnity on the Closing
Date and INTERCONTINENTAL FLORIDA LIMITED PARTNERSHIP, a Delaware limited
partnership, which shall execute and deliver the Sponsor Indemnity on or before
September 15, 2007.”
8. The
definition of “Threshold Amount” is hereby amended by deleting “12,000,000” and
replacing with “12,100,000”.
9. Section
3.1 of the Loan Agreement is hereby amended by deleting all references to
“Intercontinental Chicago f/b/o Citigroup Global Markets Realty Corp.” and
replacing with “SHC Michigan Avenue, LLC f/b/o Citigroup Global Markets Realty
Corp.”
10. Section
4.1.1 of the Loan Agreement is hereby amended by:
(a) deleting
the second sentence thereof and replacing it with:
“Each
Sponsor entity is either a limited partnership or a limited liability company,
and each such entity has been duly organized and is validly existing and in
good
standing
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pursuant to the laws of the relevant State where formed with requisite
power and authority to own its properties and to transact the businesses
in
which it is now engaged”; and
(b) inserting
“Any amendments to the organizational documents of the Borrower and Operating
Lessee were accomplished in accordance with, and was permitted by, the relevant
provisions of such documents prior to any such amendments” at the end of this
Section.
11. Section
4.1.27 of the Loan Agreement is hereby amended by deleting the fourth
sentence thereof.
12. Section
4.1.29 of the Loan Agreement is hereby amended by:
(a) inserting
“(c)” before the second paragraph of this Section; and
(b) inserting
a new paragraph (b) as follows:
“(b) Borrower
hereby represents with respect to Borrower and Operating Lessee that from the
date of their respective formation to the date of this Agreement that
it:
(i)
except with respect to any indebtedness for which it was obligated and which
has
been paid and satisfied in full (the “Former
Indebtedness”), has paid all of its debts and liabilities from its
assets;
(ii) except
for the Former Indebtedness, has not guaranteed or become
obligated for the debts of any other Person;
(iii)
except for the Former Indebtedness, has not held itself out as being responsible
for the debts or obligations of any other Person;
(iv) except
for the Former Indebtedness, has not pledged its assets to secure the
obligations of any other Person and no such pledge remains outstanding except
in
connection with the Loan; and
(v)
has not incurred any indebtedness that is still outstanding other than
indebtedness that is permitted under the Loan Documents.”
13. Section
5.1.5 of the Loan Agreement is hereby deleted and replaced with the
following:
““Section
5.1.5 Consents. If
Borrower is a corporation, the board of directors of such Person may not take
any action requiring the unanimous affirmative vote of 100% of the members
of
the board of directors unless all of the directors, including the Independent
Directors,
shall have participated in such vote if such vote relates to a Material
Action. If Borrower is a limited liability company, (a) if such
Person is managed by a board of managers, the board of managers of such Person
may not take any action requiring the unanimous affirmative vote of 100% of
the
members of the board of managers unless all of the managers,
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including the Independent Managers, shall have participated in such vote
if
such vote relates to a Material Action, (b) if such Person is not managed
by a board of managers, the members of such Person may not take any action
requiring the affirmative vote of 100% of the members of such Person unless
all
of the members, including the Independent Members, shall have participated
in
such vote if such vote relates to a Material Action. An affirmative
vote of 100% of the directors, board of managers or members, as applicable,
including without limitation the Independent Directors, of Borrower shall
be
required to take any Material Action. Furthermore, Borrower’s
formation documents shall expressly state that for so long as the Loan is
outstanding, Borrower shall not be permitted to (i) dissolve, liquidate,
consolidate, merge or sell all or substantially all of Borrower’s assets other
than in connection with the repayment of the Loan or (ii) engage in any
other business activity and such restrictions shall not be modified or violated
for so long as the Loan is outstanding.”
14. Section
8.1 of the Loan Agreement is hereby amended by deleting “(i)” after
“Restrictions on Transfers and Indebtedness.” and
replacing with “(a)”.
15. Section
8.1(a) of the Loan Agreement is hereby amended by inserting “or (iii) the
ability of the holders of direct or indirect legal, Beneficial or equitable
interests in DND Hotel JV Pte Ltd to Transfer its equity interests in SHC
Michigan Avenue Mezzanine II, LLC, provided however, the requirements of
Section 8.4 and Section 8.6 are complied with” at the end of this
subsection.
16. Section
8.4(c) of the Loan Agreement is hereby amended by deleting “fifty-one
percent (51%)” and replacing with “in excess of fifty percent
(50%)”.
17. Section
8.7.1 of the Loan Agreement is hereby amended by deleting “Lender
acknowledges and consents to the termination of the Gift Shop Lease effective
on
or about October 1, 2006”.
18. Section
14.1.2 of the Loan Agreement is hereby amended by inserting at the end of
the first sentence “, including, without limitation, providing a
Non-Consolidation Opinion under Singapore law in form and substance satisfactory
to the Rating Agencies if required by the Rating Agencies in connection with
the
Securitization.”
19. Section
14.5 of the Loan Agreement is hereby deleted and replaced with the
following:
“Section
14.5 Retention of Servicer. Lender
reserves the right to retain the Servicer. Lender has advised
Borrower that the Servicer initially retained by Lender shall be KeyCorp Real
Estate Capital Markets, Inc. Borrower shall pay any reasonable servicing fees,
special servicing fees, trustee fees and any administrative fees and expenses
of
the Servicer, including, without limitation, reasonable attorney and other
third-party fees and disbursements in connection with a prepayment, release
of
the Property, assumption or modification of the Loan
or
enforcement of the Loan Documents. The obligations of Borrower under this
Section 14.5 include, without limitation, the obligation to pay an annual
servicing fee in monthly installments for the entire term of the Loan, equal
to
one (1) basis point of the Loan amount.”
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20. The
notice provision of Section 19.6 with respect to the Borrower is hereby
deleted in its entirety and replaced with the following:
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If
to Borrower:
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SHC
Michigan Avenue Mezzanine II, LLC
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x/x
Xxxxxxxxx Xxxxx Xxxxxxx, X.X.X.
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00
Xxxx Xxxxxx Xxxxx
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Xxxxx
0000
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Xxxxxxx,
Xxxxxxxx, 00000
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(and
after September 15, 2007:
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000
Xxxx Xxxxxxx Xxxxxx
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Xxxxx
0000
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Xxxxxxx,
Xxxxxxxx, 60606)
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Attention: Chief
Financial Officer and General
Counsel
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Telephone
No.: (000) 000-0000
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Telefax
No.: (000) 000-0000
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With
a copy to:
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SHC
Michigan Avenue Mezzanine II, LLC
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x/x
Xxxxxxxxx Xxxxx Xxxxxxx, X.X.X.
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00
Xxxx Xxxxxx Xxxxx
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Xxxxx
0000
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Xxxxxxx,
Xxxxxxxx, 00000
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(and
after September 15, 2007:
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000
Xxxx Xxxxxxx Xxxxxx
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Xxxxx
0000
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Xxxxxxx,
Xxxxxxxx, 60606)
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Attention: Treasurer
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Telephone
No.: (000) 000-0000
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Telefax
No.: (000) 000-0000
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With
a copy to:
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Xxxxxxx
Coie LLP
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000
Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000
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Xxxxxxx,
XX 00000-0000
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Attention: Xxxxx
X. Bonjour, Esq.
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Telephone
No.: (000) 000-0000
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Telefax
No.: (000) 000-0000
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21. All
references to the “Loan Agreement” contained in any of the Loan Documents shall
be deemed to refer to the Loan Agreement as amended by this Agreement, as the
same may be further amended, restated, replaced, supplemented or otherwise
modified from time to time.
22. This
Agreement shall be effective as of the date hereof and binding upon and inure
to
the benefit of the parties hereto and their respective successors and permitted
assigns. All
references to “Closing Date” in the Loan Agreement shall be deemed to be the
date hereof.
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23. Except
as
specifically modified and amended herein, all other terms, conditions and
covenants contained in the Loan Agreement shall remain in full force and
effect.
24. This
Agreement shall be governed by, and construed in accordance with, the laws
of
the State of New York applicable to contracts made and performed in such State
(without regard to principles of conflict laws) and any applicable law of the
United States of America.
25. This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument.
[NO
FURTHER TEXT ON THIS PAGE]
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IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed by their duly authorized representatives, all as of the day and year
first above written.
| BORROWER: | |
| SHC MICHIGAN AVENUE, LLC, | |
| a Delaware limited liability company | |
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By
/s/ Xxxx X.
Xxxxx
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Name:
Xxxx X. Xxxxx
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Title:
Vice President and Treasurer
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[SIGNATURE
PAGES CONTINUE ON FOLLOWING PAGE]
| LENDER: | |
| CITIGROUP GLOBAL MARKETS REALTY CORP., | |
| a New York corporation | |
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By:
/s/ Xxx X.
Xxxx
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Name:
Xxx X. Xxxx
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Title:
Authorized
Signatory
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CONSENT
OF SPONSOR AND OPERATING LESSEE
Each
of
the undersigned hereby acknowledges and consents and agrees to the foregoing
Amendment.
| SPONSOR: | |
| INTERCONTINENTAL FLORIDA LIMITED PARTNERSHIP LP, | |
| a Delaware limited partnership | |
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By
/s/ Xxxx
Xxxxx
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Name:
Xxxx Xxxxx
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Title:
Vice President and
Treasurer
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| SHC MICHIGAN AVENUE MEZZANINE II, LLC, | |
| a Delaware limited liability company | |
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By:
/s/ Xxxx
Xxxxx
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Name:
Xxxx Xxxxx
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Title:
Vice President and
Treasurer
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| OPERATING LESSEE: | |
| NEW DTRS MICHIGAN AVENUE, LLC, | |
| a Delaware limited liability company | |
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By:
/s/ Xxxx
Xxxxx
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Name:
Xxxx Xxxxx
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Title:
Vice President and
Treasurer
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