Exhibit 10.5

 

 

GUARANTY OF RECOURSE OBLIGATIONS

made by

CONDOR HOSPITALITY TRUST, INC.

AND

ALAN KANDERS

AND

RAVIRAJ KIRAN DAVE

as guarantors,

in favor of

LOANCORE CAPITAL CREDIT REIT LLC

Dated as of August 22, 2016

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GUARANTY OF RECOURSE OBLIGATIONS

This GUARANTY OF RECOURSE OBLIGATIONS (this “Guaranty”), dated as of August 22,
2016, made by CONDOR HOSPITALITY TRUST, INC. (“Condor”), a Maryland corporation,
having an address at 4800 Montgomery Lane, Suite 220, Bethesda, Maryland 20814,
ALAN KANDERS (“Kanders”), an individual having an address at 500 West End Ave,
Apt 2A, New York, New York 10024, and RAVIRAJ KIRAN DAVE (“Dave”; and together
with Kanders, collectively, the “Individual Guarantors”), an individual, having
an address at 40 West 57th Street, 29th Floor, New York, New York 10019, (each
of Condor, Kanders and Dave, a “Guarantor” and collectively, “Guarantors”), in
favor of LOANCORE CAPITAL CREDIT REIT LLC, a Delaware limited liability company
(together with its successors and assigns, hereinafter referred to as “Lender”),
having an address c/o LoanCore Capital, 55 Railroad Avenue, Suite 100,
Greenwich, Connecticut 06830.

R E C I T A L S:

A. Pursuant to that certain Loan Agreement dated as of the date hereof (as the
same may be amended, modified, supplemented or replaced from time to time, the
“Loan Agreement”) between Spring Street Hotel Property LLC and Spring Street
Hotel Opco LLC, each a Delaware limited liability company (individually or
collectively as the context so requires, “Borrower”) and Lender, Lender has
agreed to make a loan (the “Loan”) to Borrower in an aggregate principal amount
not to exceed $33,750,000, subject to the terms and conditions of the Loan
Agreement;

B. As a condition to Lender’s making the Loan, Lender is requiring that
Guarantors execute and deliver to Lender this Guaranty; and

C. Each Guarantor hereby acknowledges that it will materially benefit from
Lender’s agreeing to make the Loan;

NOW, THEREFORE, in consideration of the premises set forth herein and as an
inducement for and in consideration of the agreement of Lender to make the Loan
pursuant to the Loan Agreement, each Guarantor hereby agrees, covenants,
represents and warrants to Lender as follows:

1. Definitions.

(a) All capitalized terms used and not defined herein shall have the respective
meanings given such terms in the Loan Agreement.

(b) The term “Foreclosure Event” means (x) the completion of a foreclosure of
the Loan or the acceptance by Lender (in writing) of a deed in lieu of
foreclosure under the Loan Documents or (y) if the Loan is bifurcated into a
mortgage and mezzanine loan pursuant to Section 9.2 of the Loan Agreement, the
completion of a foreclosure pursuant to any

 

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mezzanine loan lender’s rights under any mezzanine loan document and UCC or the
acceptance by any mezzanine loan lender (in writing) of a conveyance in lieu of
foreclosure, each (in the case of the events described in this clause (y)) in
accordance with the applicable terms of the related intercreditor agreement,
provided that a “Foreclosure Event” as described in this clause (y) shall not
occur if any Guarantor or any Affiliate colludes with such mezzanine loan lender
to effectuate such Foreclosure Event without the participation or consent of
Lender.

(c) The term “Guaranteed Obligations” means (i) Borrower’s Recourse Liabilities
and (ii) from and after the date that any Springing Recourse Event occurs,
payment of all the Debt as and when the same is due in accordance with the Loan
Documents (and whether accrued prior to, on or after such date).

2. Guaranty.

(a) Each Guarantor hereby irrevocably, absolutely and unconditionally guarantees
to Lender the full, prompt and complete payment when due of the Guaranteed
Obligations. Notwithstanding anything to the contrary contained herein or in any
other Loan Document, it is expressly understood and agreed that Condor shall not
be liable hereunder for any Guaranteed Obligation arising as a result of any JV
Agreement Recourse Liabilities and the Individual Guarantors shall be solely
liable for any and all Guaranteed Obligations arising as a result of any JV
Agreement Recourse Liabilities.

(b) All sums payable to Lender under this Guaranty shall be payable five
(5) Business Days after demand and without reduction for any offset, claim,
counterclaim or defense.

(c) Each Guarantor agrees that no portion of any sums applied (other than sums
received from Guarantor in full or partial satisfaction of its obligations
hereunder), from time to time, in reduction of the Debt shall be deemed to have
been applied in reduction of the Guaranteed Obligations until such time as the
Debt has been paid in full, or Guarantors shall have made the full payment
required hereunder, it being the intention hereof that the Guaranteed
Obligations shall be the last portion of the Debt to be deemed satisfied.

3. Representations and Warranties. Each Guarantor hereby, as to itself or
himself, as applicable, represents and warrants to Lender as follows (which
representations and warranties shall be given as of the date hereof and shall
survive the execution and delivery of this Guaranty):

(a) Organization, Authority and Execution. Condor is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Maryland, and has all necessary power and authority to own its properties and to
conduct its business as presently conducted or proposed to be conducted and to
enter into and perform this Guaranty and all other agreements and instruments to
be executed by it in connection herewith. This Guaranty has been duly executed
and delivered by each Guarantor.

(b) Enforceability. This Guaranty constitutes a legal, valid and binding
obligation of each Guarantor, enforceable against each Guarantor in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors’ rights generally.

 

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(c) No Violation. The execution, delivery and performance by Condor of its
obligations under this Guaranty has been duly authorized by all necessary
action, and do not and will not violate any law, regulation, order, writ,
injunction or decree of any court or governmental body, agency or other
instrumentality applicable to Condor, or result in a breach of any of the terms,
conditions or provisions of, or constitute a default under, or result in the
creation or imposition of any mortgage, lien, charge or encumbrance of any
nature whatsoever upon any of the assets of Condor pursuant to the terms of
Condor’s articles of organization, or any mortgage, indenture, agreement or
instrument to which Condor is a party or by which it or any of its properties is
bound. The execution, delivery and performance by the Individual Guarantors of
their obligations under this Guaranty do not and will not violate any law,
regulation, order, writ, injunction or decree of any court or governmental body,
agency or other instrumentality applicable to the Individual Guarantors, or
result in a breach of any of the terms, conditions or provisions of, or
constitute a default under, or result in the creation or imposition of any
mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the
assets of the Individual Guarantors pursuant to the terms of any mortgage,
indenture, agreement or instrument to which the Individual Guarantors are a
party or by which they or any of their properties is bound. No Guarantor is in
default under any other guaranty which it has provided to Lender.

(d) No Litigation. There are no actions, suits or proceedings at law or at
equity, pending or, to each Guarantor’s best knowledge, threatened against or
affecting a Guarantor or which involve or might involve the validity or
enforceability of this Guaranty or which might materially adversely affect the
financial condition of a Guarantor or the ability of a Guarantor to perform any
of its obligations under this Guaranty. No Guarantor is in default beyond any
applicable grace or cure period with respect to any order, writ, injunction,
decree or demand of any Governmental Authority which might materially adversely
affect the financial condition of such Guarantor or the ability of such
Guarantor to perform any of its obligations under this Guaranty.

(e) Consents. All consents, approvals, orders or authorizations of, or
registrations, declarations or filings with, all Governmental Authorities
(collectively, the “Consents”) that are required in connection with the valid
execution, delivery and performance by Guarantors of this Guaranty have been
obtained and each Guarantor agrees that all Consents required in connection with
the carrying out or performance of any of such Guarantor’s obligations under
this Guaranty will be obtained when required.

(f) Financial Statements and Other Information. All financial statements of
Guarantors heretofore delivered to Lender are true and correct in all material
respects and fairly present the financial condition of Guarantors as of the
respective dates thereof, and no materially adverse change has occurred in the
financial conditions reflected therein since the respective dates thereof. None
of the aforesaid financial statements or any certificate or statement furnished
to Lender by or on behalf of a Guarantor in connection with the transactions
contemplated hereby, and none of the representations and warranties in this
Guaranty contains any untrue statement of a material fact or omits to state a
material fact

 

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necessary in order to make the statements contained therein or herein not
misleading. No Guarantor is insolvent within the meaning of the United States
Bankruptcy Code or any other applicable law, code or regulation and the
execution, delivery and performance of this Guaranty will not render any
Guarantor insolvent.

(g) Consideration. Each Guarantor is the owner, directly or indirectly, of
certain legal and beneficial equity interests in Borrower.

4. Financial Statements. The Individual Guarantors shall deliver to Lender,
(a) within 90 days after the end of each calendar year, (i) a complete copy of
the Individual Guarantors’ annual financial statements which shall be prepared
by an independent certified public accountant after the occurrence of an Event
of Default, certified by each Individual Guarantor as applicable, and in form,
content, level of detail and scope reasonably acceptable to Lender (it being
agreed that the form of financial statements delivered to Lender in connection
with the closing of the Loan are acceptable to Lender), and (ii) a certificate
of each Individual Guarantor setting forth the Net Worth (as defined below) and
Liquid Assets (as defined below) of each Individual Guarantor in form, content,
level of detail and scope reasonably satisfactory to Lender, and (b) 20 days
after request by Lender, such other financial information with respect to the
Individual Guarantors as Lender may reasonably request.

5. Unconditional Character of Obligations of Guarantors.

(a) The obligations of Guarantors hereunder shall be irrevocable, absolute and
unconditional, irrespective of the validity, regularity or enforceability, in
whole or in part, of the other Loan Documents or any provision thereof, or the
absence of any action to enforce the same, any waiver or consent with respect to
any provision thereof, the recovery of any judgment against Borrower, a
Guarantor or any other Person or any action to enforce the same, any failure or
delay in the enforcement of the obligations of Borrower under the other Loan
Documents or Guarantors under this Guaranty, or any setoff, counterclaim, and
irrespective of any other circumstances which might otherwise limit recourse
against a Guarantor by Lender or constitute a legal or equitable discharge or
defense of a guarantor or surety. Lender may enforce the obligations of any
Guarantor under this Guaranty by a proceeding at law, in equity or otherwise,
independent of any loan foreclosure or similar proceeding or any deficiency
action against Borrower or any other Person at any time, either before or after
an action against the Property or any part thereof, Borrower or any other
Person. This Guaranty is a guaranty of payment and performance and not merely a
guaranty of collection. Each Guarantor waives diligence, notice of acceptance of
this Guaranty, filing of claims with any court, any proceeding to enforce any
provision of any other Loan Document, against such Guarantor, Borrower or any
other Person, any right to require a proceeding first against Borrower or any
other Person, or to exhaust any security (including, without limitation, the
Property) for the performance of the Guaranteed Obligations or any other
obligations of Borrower or any other Person, or any protest, presentment, notice
of default or other notice or demand whatsoever (except to the extent expressly
provided to the contrary in this Guaranty).

(b) The obligations of Guarantors under this Guaranty, and the rights of Lender
to enforce the same by proceedings, whether by action at law, suit in equity or
otherwise, shall not be in any way affected by any of the following:

(i) any insolvency, bankruptcy, liquidation, reorganization, readjustment,
composition, dissolution, receivership, conservatorship, winding up or other
similar proceeding involving or affecting Borrower, the Property or any part
thereof, a Guarantor or any other Person;

 

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(ii) any failure by Lender or any other Person, whether or not without fault on
its part, to perform or comply with any of the terms of the Loan Agreement, or
any other Loan Documents, or any document or instrument relating thereto;

(iii) the sale, transfer or conveyance of the Property or any interest therein
to any Person, whether now or hereafter having or acquiring an interest in the
Property or any interest therein and whether or not pursuant to any foreclosure,
trustee sale or similar proceeding against Borrower or the Property or any
interest therein;

(iv) the conveyance to Lender, any Affiliate of Lender or Lender’s nominee of
the Property or any interest therein by a deed-in-lieu of foreclosure;

(v) the release of Borrower or any other Person from the performance or
observance of any of the agreements, covenants, terms or conditions contained in
any of the Loan Documents by operation of law or otherwise; or

(vi) the release in whole or in part of any collateral for any or all Guaranteed
Obligations or for the Loan or any portion thereof.

(c) Except as otherwise specifically provided in this Guaranty, each Guarantor
hereby expressly and irrevocably waives all defenses in an action brought by
Lender to enforce this Guaranty based on claims of waiver, release, surrender,
alteration or compromise and all setoffs, reductions, or impairments, whether
arising hereunder or otherwise, other than a mandatory or compulsory
counterclaim, in any action or proceeding brought against or by Lender.

(d) Lender may deal with Borrower and Affiliates of Borrower in the same manner
and as freely as if this Guaranty did not exist and shall be entitled, among
other things, to grant Borrower or any other Person such extension or extensions
of time to perform any act or acts as may be deemed advisable by Lender, at any
time and from time to time, without terminating, affecting or impairing the
validity of this Guaranty or the obligations of Guarantors hereunder.

(e) No compromise, alteration, amendment, modification, extension, renewal,
release or other change of, or waiver, consent, delay, omission, failure to act
or other action with respect to, any liability or obligation under or with
respect to, or of any of the terms, covenants or conditions of, the Loan
Documents shall in any way alter, impair or affect any of the obligations of
Guarantors hereunder, and Guarantors agree that if any Loan Documents are
modified with Lender and Borrower’s written consent, the Guaranteed Obligations
shall automatically be deemed modified to include such modifications.

 

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(f) Lender may proceed to protect and enforce any or all of its rights under
this Guaranty by suit in equity or action at law, whether for the specific
performance of any covenants or agreements contained in this Guaranty or
otherwise, or to take any action authorized or permitted under applicable law,
and shall be entitled to require and enforce the performance of all acts and
things required to be performed hereunder by Guarantors. Each and every remedy
of Lender shall, to the extent permitted by law, be cumulative and shall be in
addition to any other remedy given hereunder or now or hereafter existing at law
or in equity.

(g) No waiver shall be deemed to have been made by Lender of any rights
hereunder unless the same shall be in writing and signed by Lender, and any such
waiver shall be a waiver only with respect to the specific matter involved and
shall in no way impair the rights of Lender or the obligations of Guarantors to
Lender in any other respect or at any other time.

(h) At the option of Lender, any Guarantor may be joined in any action or
proceeding commenced by Lender against Borrower in connection with or based upon
any other Loan Documents and recovery may be had against any Guarantor in such
action or proceeding or in any independent action or proceeding against such
Guarantor to the extent of such Guarantor’s liability hereunder, without any
requirement that Lender first assert, prosecute or exhaust any remedy or claim
against Borrower or any other Person, or any security for the obligations of
Borrower or any other Person.

(i) Guarantors agree that this Guaranty shall continue to be effective or shall
be reinstated, as the case may be, if at any time any payment is made by
Borrower or a Guarantor to Lender and such payment is rescinded or must
otherwise be returned by Lender (as determined by Lender in its sole and
absolute discretion) upon insolvency, bankruptcy, liquidation, reorganization,
readjustment, composition, dissolution, receivership, conservatorship, winding
up or other similar proceeding involving or affecting Borrower or a Guarantor,
all as though such payment had not been made.

(j) In the event that any Guarantor shall advance or become obligated to pay any
sums under this Guaranty or in connection with the Guaranteed Obligations or in
the event that for any reason whatsoever Borrower or any subsequent owner of the
Property or any part thereof is now, or shall hereafter become, indebted to a
Guarantor, such Guarantor agrees that (i) the amount of such sums and of such
indebtedness and all interest thereon shall at all times be subordinate as to
lien, the time of payment and in all other respects to all sums, including
Principal and interest and other amounts, at any time owed to Lender under the
Loan Documents, and (ii) such Guarantor shall not be entitled to enforce or
receive payment thereof until all Principal, interest and other sums due
pursuant to the Loan Documents have been paid in full. Nothing herein contained
is intended or shall be construed to give any Guarantor any right of subrogation
in or under the Loan Documents or any right to participate in any way therein,
or in the right, title or interest of Lender in or to any collateral for the
Loan, notwithstanding any payments made by a Guarantor under this Guaranty,
until the actual and irrevocable receipt by Lender of payment in full of all
Principal, interest and other sums due with respect to the Loan or otherwise
payable under the Loan Documents. If any amount shall be paid to a Guarantor on
account of such subrogation rights at any time when any such sums due and owing
to Lender shall not have been fully paid, such amount shall be paid by such
Guarantor to Lender for credit and application against such sums due and owing
to Lender.

 

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(k) Subject to Section 19 hereof, Guarantors’ obligations hereunder shall
survive a foreclosure, deed-in-lieu of foreclosure or similar proceeding
involving the Property and the exercise by Lender of any or all of its remedies
pursuant to the Loan Documents.

6. Covenants.

(a) As used in this Section 6, the following terms shall have the respective
meanings set forth below:

(i) “GAAP” shall mean generally accepted accounting principles, consistently
applied.

(ii) “Liquid Assets” shall mean assets in the form of cash, cash equivalents,
obligations of (or fully guaranteed as to principal and interest by) the United
States or any agency or instrumentality thereof (provided the full faith and
credit of the United States supports such obligation or guarantee), certificates
of deposit issued by a commercial bank having net assets of not less than $500
million, securities listed and traded on a recognized stock exchange or traded
over the counter and listed in the National Association of Securities Dealers
Automatic Quotations, undrawn lines of credit that are unrestricted and
available on an immediate basis or liquid debt instruments that have a readily
ascertainable value and are regularly traded in a recognized financial market.

(iii) “Net Worth” shall mean, as of a given date, (x) the total assets of a
Guarantor as of such date (exclusive of any interest in the Property or in any
other asset that is part of the collateral for the Loan) less (y) such
Guarantor’s total liabilities as of such date, determined in accordance with
GAAP.

(b) Until all of the Guaranteed Obligations have been paid in full, Guarantors
(i) shall maintain, collectively, (A) a Net Worth in excess of $20,000,000 (the
“Net Worth Threshold”) and (B) Liquid Assets having a market value of at least
$2,500,000 (the “Liquid Assets Threshold”) and (ii) shall not sell, pledge,
mortgage or otherwise transfer any of its assets, or any interest therein, which
would cause Guarantors’ Net Worth to fall below the Net Worth Threshold or
Guarantors’ Liquid Assets to fall below the Liquid Assets Threshold.

(c) No Individual Guarantor shall, at any time while a default in the payment of
the Guaranteed Obligations has occurred and is continuing, either (i) enter into
or effectuate any transaction with any Affiliate which would reduce the Net
Worth of such Individual Guarantor or (ii) sell, pledge, mortgage or otherwise
transfer to any Person any of such Individual Guarantor’s assets, or any
interest therein.

7. Entire Agreement/Amendments. This instrument represents the entire agreement
between the parties with respect to the subject matter hereof. The terms of this
Guaranty shall not be waived, altered, modified, amended, supplemented or
terminated in any manner whatsoever except by written instrument signed by
Lender and Guarantors.

 

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8. Successors and Assigns. This Guaranty shall be binding upon each Guarantor,
and such Guarantor’s estate, heirs, personal representatives, successors and
assigns, may not be assigned or delegated by any Guarantor and shall inure to
the benefit of Lender and its successors and assigns.

9. Governing Law.

(a) THIS GUARANTY WAS NEGOTIATED IN THE STATE OF NEW YORK AND THE PROCEEDS OF
THE NOTE DELIVERED PURSUANT TO THE LOAN AGREEMENT WERE DISBURSED FROM THE STATE
OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE
PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS,
INCLUDING MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS GUARANTY AND
THE OBLIGATIONS ARISING HEREUNDER 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 AND ANY APPLICABLE LAW OF THE UNITED STATES OF
AMERICA. TO THE FULLEST EXTENT PERMITTED BY LAW, EACH GUARANTOR HEREBY
UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY
OTHER JURISDICTION GOVERNS THIS GUARANTY AND THE NOTE, AND THIS GUARANTY AND THE
NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK PURSUANT TO § 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

(b) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR CONDOR ARISING OUT OF
OR RELATING TO THIS GUARANTY SHALL BE INSTITUTED IN ANY FEDERAL OR STATE COURT
IN NEW YORK COUNTY, NEW YORK AND CONDOR WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING,
AND CONDOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN
ANY SUIT, ACTION OR PROCEEDING. CONDOR DOES HEREBY DESIGNATE AND APPOINT
CORPORATION SERVICE COMPANY AT 1180 AVENUE OF THE AMERICAS, SUITE 210, NEW YORK,
NEW YORK 10036, AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF
SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR
PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT
SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID
SERVICE OF CONDOR MAILED OR DELIVERED TO CONDOR IN THE MANNER PROVIDED HEREIN
SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON CONDOR
(UNLESS LOCAL LAW REQUIRES ANOTHER METHOD OF SERVICE), IN ANY SUCH SUIT, ACTION
OR PROCEEDING IN THE STATE OF NEW YORK. CONDOR (i) SHALL GIVE PROMPT NOTICE TO
LENDER OF ANY CHANGED ADDRESS OF ITS AUTHORIZED AGENTS HEREUNDER, (ii) MAY AT
ANY TIME AND FROM TIME TO TIME DESIGNATE A

 

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SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH OFFICE
SHALL BE DESIGNATED AS THE ADDRESS FOR SERVICE OF PROCESS), AND (iii) SHALL
PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENTS CEASE TO HAVE AN
OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR.
NOTWITHSTANDING THE FOREGOING, LENDER SHALL HAVE THE RIGHT TO INSTITUTE ANY
LEGAL SUIT, ACTION OR PROCEEDING FOR THE ENFORCEMENT OR FORECLOSURE OF ANY LIEN
ON ANY COLLATERAL FOR THE LOAN IN ANY FEDERAL OR STATE COURT IN ANY
JURISDICTION(S) THAT LENDER MAY ELECT IN ITS SOLE AND ABSOLUTE DISCRETION, AND
CONDOR WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND CONDOR HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING.

(c) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER, KANDERS OR DAVE ARISING
OUT OF OR RELATING TO THIS GUARANTY SHALL BE INSTITUTED IN ANY FEDERAL OR STATE
COURT IN NEW YORK COUNTY, NEW YORK AND KANDERS AND DAVE WAIVE ANY OBJECTION
WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING, AND KANDERS AND DAVE HEREBY IRREVOCABLY SUBMIT TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. KANDERS AND
DAVE AGREE THAT SERVICE OF PROCESS UPON KANDERS AND DAVE AT THE ADDRESS FOR
KANDERS AND DAVE SET FORTH HEREIN AND WRITTEN NOTICE OF SAID SERVICE MAILED OR
DELIVERED TO KANDERS AND DAVE IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN
EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON KANDERS AND DAVE IN ANY SUCH
SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK. KANDERS AND DAVE, AS
APPLICABLE (i) SHALL GIVE PROMPT NOTICE TO LENDER OF ANY CHANGE IN THE ADDRESS
FOR KANDERS AND DAVE SET FORTH HEREIN, (ii) MAY AT ANY TIME AND FROM TIME TO
TIME DESIGNATE AN AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH
AGENT AND OFFICE SHALL BE DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF
PROCESS), AND (iii) SHALL PROMPTLY DESIGNATE AN AUTHORIZED AGENT IF KANDERS OR
DAVE CEASES TO HAVE AN OFFICE IN NEW YORK, NEW YORK. NOTWITHSTANDING THE
FOREGOING, LENDER SHALL HAVE THE RIGHT TO INSTITUTE ANY LEGAL SUIT, ACTION OR
PROCEEDING FOR THE ENFORCEMENT OR FORECLOSURE OF ANY LIEN ON ANY COLLATERAL FOR
THE LOAN IN ANY FEDERAL OR STATE COURT IN ANY JURISDICTION(S) THAT LENDER MAY
ELECT IN ITS SOLE AND ABSOLUTE DISCRETION, AND KANDERS AND DAVE WAIVE ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING, AND KANDERS AND DAVE HEREBY IRREVOCABLY SUBMIT TO
THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING.

10. Section Headings. The headings of the sections and paragraphs of this
Guaranty have been inserted for convenience of reference only and shall in no
way define, modify, limit or amplify any of the terms or provisions hereof.

 

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11. Severability. Any provision of this Guaranty which may be determined by any
competent authority to be prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, each Guarantor hereby waives any provision of law
which renders any provision hereof prohibited or unenforceable in any respect.

12. WAIVER OF TRIAL BY JURY. EACH GUARANTOR HEREBY WAIVES THE RIGHT OF TRIAL BY
JURY IN ANY LITIGATION, ACTION OR PROCEEDING ARISING HEREUNDER OR IN CONNECTION
THEREWITH.

13. Other Guaranties. The obligations of each Guarantor hereunder are separate
and distinct from, and in addition to, the obligations of such Guarantor now or
hereafter arising under any other guaranties, indemnification agreements or
other agreements to which such Guarantor is now or hereafter becomes a party. In
no event shall any Guarantor be entitled to any credit against amounts due under
this Guaranty by reason of amounts paid to Lender by Guarantors (or any of them)
or any other person under or by reason of the other guaranties, indemnification
agreements or other agreements to which Guarantors (or any of them) are now or
hereafter become a party.

Notices. All notices, consents, approvals and requests required or permitted
hereunder (a “Notice”) shall be given in writing and shall be effective for all
purposes if either hand delivered with receipt acknowledged, or by a nationally
recognized overnight delivery service (such as Federal Express), or by certified
or registered United States mail, return receipt requested, postage prepaid, or
by facsimile and confirmed by facsimile answer back, in each case addressed as
follows (or to such other address or Person as a party shall designate from time
to time by notice to the other party): If to Lender: Jefferies LoanCore LLC, 55
Railroad Avenue, Suite 100, Greenwich, Connecticut 06830, Attention: Brett
Kaplan, Telecopier (203) 861-6006, with a copy to: Kaye Scholer LLP, 250 West
55th Street, New York, New York 10019-9710, Attention: Stephen Gliatta, Esq.,
Telecopier: (212) 836-8689; if to Condor: c/o Condor Hospitality Trust, Inc.,
4800 Montgomery Lane, Suite 220, Bethesda, Maryland 20814, Attn: Jonathan J.
Gantt, Chief Financial Officer and Senior Vice President, Email:
jgantt@trustcondor.com with a copy to: Condor Hospitality Trust, Inc., 11422
Miracle Hills Drive, Suite 501, Omaha, Nebraska 68154, Attn: Lauren Green, Esq.
Corporate Counsel, Email: lgreen@trustcondor.com; if to Kanders: 500 West End
Ave, Apt 2A, New York, New York 10024; if to Dave: c/o 40 West 57th Street, 29th
Floor, New York, New York 10019 with a copy to 12 Summit Street, Englewood
Cliffs, New Jersey 07632. A notice shall be deemed to have been given: in the
case of hand delivery, at the time of delivery; in the case of registered or
certified mail, when delivered or the first attempted delivery on a Business
Day; or in the case of overnight delivery, upon the first attempted delivery on
a Business Day.

14. Guarantor’s Receipt of Loan Documents. Each Guarantor by its execution
hereof acknowledges receipt of true copies of all of the Loan Documents, the
terms and conditions of which are hereby incorporated herein by reference.

 

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15. Interest; Expenses.

(a) If Guarantors fail to pay all or any sums due hereunder upon demand by
Lender, the amount of such sums payable by Guarantors to Lender shall bear
interest from the date of demand until paid at the Default Rate in effect from
time to time.

(b) Each Guarantor hereby agrees to pay all costs, charges and expenses,
including reasonable attorneys’ fees and disbursements, that may be incurred by
Lender in enforcing the covenants, agreements, obligations and liabilities of
Guarantors under this Guaranty.

16. Joint and Several Obligations. Each Guarantor shall have joint and several
liability for the obligations of Guarantors hereunder.

17. Counterparts. This Guaranty may be executed in any number of counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument.

18. Release of Guarantors. Notwithstanding anything to the contrary contained
herein, Guarantors shall have no liability hereunder for any Guaranteed
Obligations that arise from and after:

(a) the full and complete repayment of the Debt in accordance with the terms,
provisions and requirements set forth in the Loan Agreement. For purposes for
this clause (a), (i) repayment of the Debt shall not be deemed to have occurred
by reason of a foreclosure of the Property and (ii) to the extent a third party
suit, proceeding or claim has been instituted or commenced relating to the Debt
or this Guaranty prior to the termination date set forth in the foregoing
sentence, this Guaranty and the Guaranteed Obligations shall remain in full
force and effect with respect to any such suit, proceeding or claim until the
earliest to occur of the completion, settlement, discontinuance or dismissal of
any such suit, proceeding or claim, including, without limitation, if
applicable, the payment and performance by Guarantors of any and all amounts (if
any) which are due and payable under this Guaranty in connection with such suit,
proceeding or claim;

(b) upon the completion of any Foreclosure Event, provided that Guarantors shall
be released from all further liability under this Guaranty solely with respect
to matters, events or circumstances which first occur or arise on or after the
date of such Foreclosure Event, as applicable, to the extent that such matters,
events or circumstances are not directly, or indirectly, caused by actions of
any Guarantor or their Affiliates taken on or after such Foreclosure Event (but
in the case of environmental liabilities specified in Section 5.30 of the Loan
Agreement, subject to the provisions of said Section 5.30). Notwithstanding the
foregoing, Guarantors shall remain obligated for the Guaranteed Obligations and
this Guaranty shall continue in full force and effect in the event any
Foreclosure Event is rescinded or declared void by a court of competent
jurisdiction.

 

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Notwithstanding anything contained in this Guaranty (including this Section 19)
to the contrary, Guarantors shall have no liability under this Guaranty for any
acts or omissions solely caused by Lender, the holder of any mezzanine loan
created in accordance with Section 9.2 of the Loan Agreement or any of their
respective designees or any purchaser at a foreclosure sale (or the purchaser of
a deed in lieu of foreclosure).

[Remainder of Page Intentionally Left Blank; Signature Page Follows]

 

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IN WITNESS WHEREOF, each Guarantor has executed this Guaranty as of the date
first above written.

 

CONDOR HOSPITALITY TRUST, INC., a Maryland corporation By:   /s/   Jonathan J.
Gantt   Name: Jonathan J. Gantt  

Title: Senior Vice President and Chief

Financial Officer

[signatures continue on following page]

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  /s/ Alan Kanders   ALAN KANDERS, an individual

[signatures continue on following page]

 

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  /s/ Raviraj Kiran Dave   RAVIRAJ KIRAN DAVE, an individual

 

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