Exhibit 10.24

 

LOGO [g55405g36p32.jpg]      

8377 East. Hartford Drive

Suite 200

Scottsdale, AZ 85255

USA

SUPERTEL LIMITED PARNTERSHIP

SPPR – SOUTH BEND, LLC

SUPERTEL HOSPITALITY, REIT TRUST

301 North 5th Street, P.O. Box 1448

Norfolk, NE 68701

  

 

T 1-480-585-4500

F 1-480-585-2225

Attn:

 

Re: Covenant Waiver; Certain Loans by GENERAL ELECTRIC CAPITAL CORPORATION, a
Delaware corporation (“Lender”) to SUPERTEL LIMITED PARTNERSHIP, a Virginia
limited partnership (“Supertel”) and SPPR – SOUTH BEND, LLC (“SPPR” and,
together with Supertel, “Borrower”); Guaranteed by SUPERTEL HOSPITALITY, REIT
TRUST, a Maryland real estate investment trust and SUPERTEL LIMITED PARTNERSHIP,
a Virginia limited partnership (collectively, “Guarantor”)

Ladies and Gentlemen:

Reference is made to the Loan Agreements relating to the Loans described on
Exhibit A hereto by Borrower and Lender (the “Original Loan Agreements”) as
amended by the Global Amendment and Consent dated as of March 16, 2009 (the
“Global Amendment” and, together with the Original Loan Agreements, the “Loan
Agreement”). The loans made pursuant to the Original Loan Agreements are
collectively referred to as the “Loan.” The Loan Agreement (as modified by this
Letter Agreement), together with all other promissory notes, documents,
agreements and instruments currently evidencing or securing the Loan are
referred to collectively as the “Loan Documents.” Borrower has requested a
limited waiver of the following financial covenant (the “Designated Financial
Covenant”) set forth in Section 6(j) of the Original Loan Agreements as amended
by the Global Amendment:

 

Loan Agreement Section No.

 

Title of Covenant

 

Period for Which Waiver is

Requested (“Designated Period”)

6(j)

  Fixed Charge Coverage Ratio (EBITDA)   the four consecutive fiscal quarters
ending September 30, 2009

Accordingly, Lender hereby waives compliance with the Designated Financial
Covenant only with respect to the Designated Period and agrees that the failure
of Borrower to comply with the Designated Financial Covenant with respect to the
Designated Period will not be a “default” or “event of default” under the Loan
Agreement. The foregoing waiver shall apply only to the Designated Financial
Covenant and for the Designated Period and shall not be a waiver of any other
terms, covenants, or conditions of the Loan Agreement, including, without
limitation, any waiver of the Designated Financial Covenant with respect to any
other period. In addition, with respect to any future compliance with financial
covenants which includes financial performance during any Designated Period,
such waiver shall not waive such future compliance.

 

GEFF smartDocs Form 6009

1/22/09

   

Supertel Global

(see Exhibit A)

4833-8339-9173.1    

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The interest rate on each of the Loans shall be increased by fifty basis points
in addition to the interest rate increase provided for in the Global Amendment
(collectively, the “Interest Rate Increase”) as set forth on Exhibit B hereto,
effective for interest accruing in November 2009 for the payment due on
December 1, 2009, and the applicable Amended Documents and related Notes are
hereby amended to reflect the Interest Rate Increase by the amounts set forth on
Exhibit B. Upon compliance by Supertel Limited Partnership with a FCCR level of
not less than 1.3:1 before dividend payouts and 1.0:1 after dividend payouts for
two consecutive fiscal quarter periods (the “FCCR Compliance Period”), the
Interest Rate Increase shall be rescinded, effective as of the first day of the
third month following the last day of the FCCR Compliance Period.

In consideration of and as a condition precedent to the effectiveness of this
waiver, Borrower shall pay Lender a waiver fee in the amount of $100,000.00.

Except as waived pursuant to this Letter Agreement, all terms and provisions of
the Loan Documents remain in full force and effect.

This Letter Agreement shall only be effective if countersigned and returned by
Borrower and Guarantor on or before November 9, 2009.

 

Very truly yours, GENERAL ELECTRIC CAPITAL CORPORATION

By:

 

/s/ James T. Short

Name:

  James T. Short

Title:

  Authorized Signatory

 

GEFF smartDocs Form 6009

1/22/09

  2  

Supertel Global

(see Exhibit A)

4833-8339-9173.1    

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ACCEPTANCE

The undersigned Borrower and Guarantor hereby acknowledge receipt of the
foregoing Letter Agreement and agree as follows: (a) the Borrower and Guarantor
reaffirm all of their obligations pursuant to the Loan Documents, except to the
extent modified by the foregoing Letter Agreement; (b) Borrower and Guarantor
acknowledge and agree that they have no claims, defenses, offsets, counterclaims
or other matters with respect to the Loan Documents; and (c) to the extent any
such claims exist or deem to exist, Borrower and Guarantor hereby waive and
release all such claims.

 

BORROWER: SUPERTEL LIMITED PARTNERSHIP, a Virginia limited partnership By:  

/s/ Kelly A. Walters

Name:   Kelly A. Walters Title:   President BORROWER: SPPR – SOUTH BEND, LLC, a
Delaware limited liability company By:  

/s/ Kelly A. Walters

Name:   Kelly A. Walters Title:   Member / Manager GUARANTOR: SUPERTEL LIMITED
PARTNERSHIP, a Virginia limited partnership By:  

/s/ Kelly A. Walters

Name:   Kelly A. Walters Title:   President GUARANTOR: SUPERTEL HOSPITALITY,
REIT TRUST, a Maryland real estate investment trust By:  

/s/ Kelly A. Walters

Name:   Kelly A. Walters Title:   President

 

GEFF smartDocs Form 6009

1/22/09

  3  

Supertel Global

(see Exhibit A)

4833-8339-9173.1    

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EXHIBIT A

 

Loan Number

  

Start Date

       

Loan Amount

32912

   May 16, 2007       $27,755,000

32098

   January 5, 2007       $15,600,000

31437

   August 18, 2006       $17,850,000

14724001

   January 2, 2008       $4,355,000

14724003

   January 2, 2008       $3,380,000

14724004

   January 2, 2008       $6,765,000

14724005

   January 2, 2008       $1,100,000

14724006

   December 31, 2007       $7,875,000

15005001

   January 31, 2008       $2,470,000

32630

   February 6, 2007       $3,445,000

 

GEFF smartDocs Form 6009

1/22/09

  4  

Supertel Global

(see Exhibit A)

4833-8339-9173.1    

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EXHIBIT B

 

Loan Number

  

Interest Rate Increase

        

Previous Increase from

Global Amendment

32912

   50 basis points       100 basis points

32098

   50 basis points       100 basis points

31437

   50 basis points       100 basis points

14724001

   50 basis points       100 basis points

14724003

   50 basis points       100 basis points

14724004

   50 basis points       100 basis points

14724005

   50 basis points       100 basis points

14724006

   50 basis points       100 basis points

15005001

   50 basis points       100 basis points

32630

   50 basis points       100 basis points

 

GEFF smartDocs Form 6009

1/22/09

  5  

Supertel Global

(see Exhibit A)

4833-8339-9173.1