Exhibit 10.1

 

LOAN AGREEMENT
Between

W. P. CAREY INC.

as Lender

and

CWI 2 OP, LP

as Borrower

Dated as of October 19, 2017

 

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TABLE OF CONTENTS

 
 
 
 
 
Page

 
 
 
 
 
 
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
1

 
Section 1.1
Certain Defined Terms
1

 
Section 1.2
Computation of Time Periods
4

 
Section 1.3
Accounting Terms
5

 
 
 
 
 
 
ARTICLE II AMOUNTS AND TERMS OF THE BORROWINGS
5

 
Section 2.1
The Commitment
 
 
5

 
Section 2.2
Advances
 
 
5

 
Section 2.3
Interest Rate
 
 
5

 
Section 2.4
Payment of Interest
 
 
6

 
Section 2.5
Default Rate
 
 
6

 
Section 2.6
Maximum Legal Rate of Interest
6

 
Section 2.7
Prepayments
 
 
6

 
Section 2.8
Maturity
6

 
Section 2.9
Evidence of Indebtedness
6

 
Section 2.10
Illegality
6

 
 
 
 
 
 
ARTICLE III CONDITIONS OF BORROWING
7

 
Section 3.1
Conditions Precedent to Initial Advance
7

 
Section 3.2
Conditions Precedent to Each Advance
7

 
 
 
 
 
 
ARTICLE IV REPRESENTATIONS AND WARRANTIES
8

 
Section 4.1
Organization
8

 
Section 4.2
Authorization; No Breach
8

 
Section 4.3
Legal Effect
8

 
Section 4.4
Information
8

 
Section 4.5
Survival of Representations and Warranties
8

 
 
 
 
 
 
ARTICLE V COVENANTS
9

 
Section 5.1
Additional Covenants
9

 
 
 
 
 
 
ARTICLE VI DEFAULT AND REMEDIES
9

 
Section 6.1
Events of Default
9

 
Section 6.2
Remedies
11

 
Section 6.3
Right of Offset
11

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Section 6.4
Cumulative Remedies
11

 
Section 6.5
Application of Payments
12

 
 
 
 
 
 
ARTICLE VII Transfers
12

 
Section 7.1
Assignment by Lender
 
12

 
 
 
 
 
 
ARTICLE VIII MISCELLANEOUS
12

 
Section 8.1
Amendments
12

 
Section 8.2
Notices
12

 
Section 8.3
No Waiver; Remedies
12

 
Section 8.4
Costs and Expenses; Indemnification
13

 
Section 8.5
Binding Effect; Assignments and Participations
13

 
Section 8.6
Execution in Counterparts
14

 
Section 8.7
Governing Law
14

 
Section 8.8
Service of Process
14

 
Section 8.9
Consent to Jurisdiction
14

 
Section 8.10
Waiver of Jury Trial
14

 
Section 8.11
No Fiduciary Duty
14

 
Section 8.12
Severability
15

 
Section 8.13
Entire Agreement
15

 
Section 8.14
Descriptive Headings
15

 
Section 8.15
Gender and Number
15

 
 
 
 
SCHEDULE 1
Notice Addresses
 
 
 
 
EXHIBIT A
Form of Advance Request
 

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LOAN AGREEMENT
THIS LOAN AGREEMENT (this “Agreement”), dated as of the date set forth on the
cover page of this Agreement, is made by and between CWI 2 OP, LP, a Delaware
limited partnership (“Borrower”), and W. P. CAREY INC., a Maryland corporation
(“Lender”).
RECITALS
Borrower has requested that Lender make certain loan advances to Borrower from
time to time. Subject to the terms and conditions of this Agreement and of the
other Loan Documents (as defined below) Lender is willing to make such advances
as provided in this Agreement.
Accordingly, the parties agree as follows:
AGREEMENT

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

Section 1.1    Certain Defined Terms. As used in this Agreement, the following
terms will have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
“Advance” means an advance of proceeds of the Loan by Lender to Borrower
pursuant to Article II.
“Advance Request” means a request in substantially the form of Exhibit A, as
applicable, or in such other form as Lender may specify from time to time, made
by Borrower to Lender for a Borrowing pursuant to the terms of this Agreement.
“Advisor” means Carey Lodging Advisors LLC, a Delaware limited liability
company.
“Affiliate” means any Person directly or indirectly controlling, controlled by,
or under direct or indirect common control with, another identified Person. A
Person will be deemed to control a corporation or other entity if such Person
possesses, directly or indirectly, the power to direct or cause the direction of
the management and policies of such corporation or other entity, whether through
the ownership of voting securities, by contract or otherwise. For purposes of
the Loan Documents, the Borrower and the Lender shall be deemed not to be
Affiliates of one another.
“Borrower” has the meaning specified in the preamble to this Agreement.
“Borrowing” means a borrowing consisting of the making of an Advance.
“Business Day” means a day that is not a Saturday, Sunday or other day on which
banks are required or authorized to close in the State of New York.

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“Change of Control” means an event or series of events by which (a) any “person”
or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), but excluding any
employee benefit plan of such person or its subsidiaries, and any person or
entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act, except that a person or group
shall be deemed to have “beneficial ownership” of all securities that such
person or group has the right to acquire, whether such right is exercisable
immediately or only after the passage of time (such right, an “option right”)),
directly or indirectly, of 50% or more of the equity securities of the entity
entitled to vote for members of the board of directors or equivalent governing
body of the Borrower or the Guarantor on a fully-diluted basis (and taking into
account all such securities that such “person” or “group” has the right to
acquire pursuant to any option right); (b) any Person or two or more Persons
acting in concert shall have acquired by contract, or shall have entered into a
contract or arrangement that, upon consummation thereof, will result in its or
their acquisition of the power to exercise, directly or indirectly, a
controlling influence over the management or policies of the Borrower or
Guarantor, or control over the equity securities of the Borrower or Guarantor
entitled to vote for members of the board of directors or equivalent governing
body of the Borrower or Guarantor on a fully-diluted basis (and taking into
account all such securities that such Person or Persons have the right to
acquire pursuant to any option right) representing 50% or more of the combined
voting power of such securities; or (c) the Guarantor shall cease to be the
general partner of the Borrower or own directly or indirectly a majority of the
Equity Interest in the Borrower. For the avoidance of doubt, any transfer by
Guarantor in respect of, or of a direct or indirect interest listed on a
nationally or internationally recognized stock exchange or stock quotation
system shall not be considered a Change of Control.
“Collateral” has the meaning specified in the Pledge Agreement.
“Commitment” means TWENTY FIVE MILLION AND 00/100 DOLLARS ($25,000,000.00), to
the extent not cancelled, reduced or transferred by the Lender under this
Agreement.
“Credit Agreement” shall mean that certain Third Amended and Restated Credit
Agreement, dated as of February 22, 2017, by and among Lender, as borrower,
certain subsidiaries of Lender identified therein, from time to time as
guarantors, the lenders from time to time party thereto, and Bank of America,
N.A., as administrative agent, as same may be amended from time to time.
“Default” has the meaning specified in the definition of “Event of Default.”
“Dollars”, “dollars” or the symbol “$” means lawful money of the United States
of America denominated in United States dollars.
“Equity Interest” means: (a) if a Person is a corporation, its capital stock;
(b) if a Person is a limited liability company, its membership interests; or (c)
if a Person is a partnership, its partnership interests.

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“Event of Default” means any of the events specified in Section 6.1, provided
that there has been satisfied any requirement in connection with such event for
the giving of notice, or the lapse of time, or the happening of any further
condition, event or act, and “Default” will mean any of such events, whether or
not any such requirement has been satisfied.
“GAAP” means generally accepted accounting principles applicable in the United
States, consistently applied.
“Guarantor” means Carey Watermark Investors 2 Inc., a Maryland corporation, and
the general partner of the Borrower.
“Guaranty” means that certain Payment Guaranty, dated as of the date hereof,
executed by Guarantor guaranteeing the Loan and all amounts owing under the Loan
Documents.
“Indebtedness” means, with respect to any Person: (a) all obligations of such
Person in respect of money borrowed or for the deferred purchase price of
property or services (excluding trade payables incurred in the ordinary course
of business no more than 90 days past due) and all accrued expenses; (b) all
obligations of such Person, whether or not for money borrowed (i) represented by
notes payable, or drafts accepted, in each case representing extensions of
credit, (ii) evidenced by bonds, debentures, notes or similar instruments, or
(iii) constituting purchase money indebtedness, conditional sales contracts,
title retention debt instruments or other similar instruments, upon which
interest charges are customarily paid or that are issued or assumed as full or
partial payment for property or for services rendered; (c) indebtedness secured
by any Lien on property carried on the asset side of the balance sheet of such
Person whether or not such Indebtedness has been assumed; (d) any other
indebtedness or liability for borrowed money or for the deferred purchase price
of property or services for which such Person is directly or contingently liable
as obligor, guarantor, or otherwise, or in respect of which such Person
otherwise assures a creditor against loss; and (e) any other obligations of such
Person under leases that have been or, pursuant to GAAP, should be recorded as
capital leases.
“Insolvency Proceeding” means any proceeding commenced by or against any Person
under any provision of the United States Bankruptcy Code, as amended, or under
any other bankruptcy or insolvency law, any assignment for the benefit of
creditors, or any other proceeding seeking reorganization, arrangement or other
relief from Indebtedness.
“Interest Rate” has the meaning specified in Section 2.3.
“Lien” means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind (including any agreement to give any of the foregoing, any
conditional sale or other title retention agreement, or any lease in the nature
thereof).
“Loan” means the revolving loans to be made pursuant to this Agreement
representing the Commitment.
“Loan Documents” means this Agreement, the Note, the Guaranty and the Pledge
Agreement.

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“Loan Parties” means Borrower and Guarantor.
“Maturity Date” means the earlier to occur of (i) December 31, 2018 and (ii)
expiration or termination by the Borrower or Guarantor of the Advisory
Agreement.
“Note” means that certain Promissory Note, dated as of the date hereof,
delivered by Borrower to Lender evidencing the aggregate Indebtedness of
Borrower to Lender under this Agreement.
“Person” means an individual, partnership, corporation (including a business
trust), joint stock company, limited liability company, trust, unincorporated
association, joint venture or other entity, or any governmental authority or
entity.
“Pledge Agreement” means that certain Pledge and Security Agreement, dated as of
the date hereof, delivered by Borrower to Lender securing the obligations of
Borrower pursuant to this Agreement and the Note.
“Secured Indebtedness” means any Indebtedness secured by a Lien.
“Subsidiary” or “Subsidiaries” means any corporation, limited liability company,
partnership or other entity a majority of (a) the total combined voting power of
all classes of Equity Interests of which or (b) the outstanding Equity Interests
of which are, as of the date of determination, owned by Borrower either directly
or through Subsidiaries.
“Subadvisor” means CWA, LLC, a Delaware limited liability company.
“Swap Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including
any such obligations or liabilities under any Master Agreement.

Section 1.2    Computation of Time Periods. In this Agreement, in the
computation of periods of time from a specified date to a later specified date:
(a) the word “from” means “from and including,” (b) the words “to” and “until”
each means “to but excluding”; and (c) the word “through” means “through and
including.”

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Section 1.3    Accounting Terms. All accounting terms not specifically defined
in this Agreement will be construed, and all accounting procedures will be
performed, in accordance with GAAP applicable as of the date of this Agreement.

ARTICLE II

AMOUNTS AND TERMS OF THE BORROWINGS

Section 2.1    The Commitment.
(a)    Subject to the terms and conditions of this Agreement, Lender will make
available to Borrower a revolving term credit loan facility in a maximum
aggregate amount at any one time outstanding not to exceed the Commitment funded
in one or more Advances in accordance with Section 2.2.
(b)    The purpose of the Commitment is to fund the general working capital
needs of a business and commercial nature only of the Borrower and its
Subsidiaries, which may include, without limitation, the payment of
distributions, the payment of debt service, acquisition and investment
activities and other business activities. Borrower may use the Commitment by
borrowing, prepaying Loans under the Loan and reborrowing Loans under Loan, all
in accordance with the terms and conditions hereof.

Section 2.2    Advances.
(a)    Advance Requests. Each Advance Request will be made by Borrower to Lender
no later than 10:00 a.m. E.S.T. four Business Days prior to the date of the
proposed Borrowing. Each Advance Request will be made by an authorized officer
of Borrower by telecopy, e-mail or overnight courier delivery, in writing, on
the form of Advance Request attached as Exhibit A.
(b)    Availability of Borrowings. Lender will make Borrowings available to
Borrower in immediate available funds to account of Borrower with Lender, or
such other account of Borrower as may be approved by Lender, by delivery of such
funds to Borrower’s account on the first Business Day after delivery of
applicable Advance Request in accordance with Section 2.2(a) hereof.

Section 2.3    Interest Rate. Each Loan included in a Borrowing will bear
interest on the outstanding principal amount thereof, for each day from the date
such Loan is made until the date

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it is repaid, at the rate of interest payable by Lender and under the Credit
Agreement (the “Interest Rate”).

Section 2.4    Payment of Interest. Borrower will pay all accrued interest on
the outstanding principal amount of each Loan borrowed under the Loan in arrears
on the date such Loan is repaid, including on any date of repayment pursuant to
Section 6.2 of this Agreement.

Section 2.5    Default Rate. Upon the occurrence of an Event of Default, and
without notice or demand, all amounts outstanding hereunder and under the Note
and the other Loan Documents, including all accrued but unpaid interest, will
thereafter bear interest at two percent (2%) per annum above the Interest Rate
that would have been applicable from time to time had there been no Event of
Default (the “Default Rate”) until all Events of Default are cured. Failure to
exercise any option granted to Lender hereunder will not waive the right to
exercise the same in the event of any subsequent Event of Default. Interest at
the Default Rate will commence to accrue upon the occurrence of any Event of
Default, including the failure to pay all sums outstanding hereunder and under
the other Loan Documents at maturity.

Section 2.6    Maximum Legal Rate of Interest. In no event will charges
constituting interest payable by Borrower to Lender exceed the maximum amount
permitted under any applicable law or regulation (the “Maximum Legal Rate”), and
if any payments by Borrower exceed such Maximum Legal Rate, the excess will be
applied first to reduce the amounts owing to Lender under this Agreement and the
other Loan Documents in such order as Lender may elect, next to reduce any other
amounts owing by Borrower to Lender in such order as Lender may elect, and any
excess will be refunded to Borrower.

Section 2.7    Prepayments. Borrower may prepay the outstanding principal
balance of each Loan in full or in part without premium or penalty at any time
and from time to time.

Section 2.8    Maturity. Borrower will repay all remaining unpaid principal of
and interest on the Loan on or before the Maturity Date.

Section 2.9    Evidence of Indebtedness. The Advances made by Lender to Borrower
will be evidenced by the Note, payable to the order of Lender and the Pledge
Agreement delivered by Borrower to Lender. Lender may maintain in accordance
with its usual practice an account or accounts evidencing the Indebtedness of
Borrower resulting from Advances and payments made from time to time under this
Agreement. In any legal action or proceeding in respect of this Agreement or the
Note, the entries made in such account or accounts will be presumptive evidence
of the existence and amounts of the obligations of Borrower therein recorded
absent manifest error.

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Section 2.10    Illegality. Notwithstanding any other provision of this
Agreement, if the introduction of or any change in or in the interpretation of
any law or regulation will make it unlawful, or any central bank or other
governmental authority will assert that it is unlawful, for Lender to perform
its obligations under this Agreement to make or maintain Advances, Lender may,
by notice to Borrower, suspend the right of Borrower to elect such Advances and,
if necessary in the reasonable opinion of Lender to comply with such law or
regulation, Borrower will prepay the outstanding balance of principal and other
sums owed to Lender under this Agreement and under the other Loan Documents at
the latest time permitted by the applicable law or regulation or, if earlier, on
the date such amounts are due and payable under the terms of this Agreement and
the other Loan Documents.

ARTICLE III

CONDITIONS OF BORROWING

Section 3.1    Conditions Precedent to Initial Advance. The obligation of Lender
to make any Advance is subject to Lender having received the following documents
in form and substance satisfactory to Lender and, as appropriate, duly executed
by the parties thereto; this Agreement, the Note, the Guaranty, and Pledge
Agreement.

Section 3.2    Conditions Precedent to Each Advance. The obligation of Lender to
make each Advance (including but not limited to the first Advance) will be
subject to the further conditions precedent that, on the date of such Advance,
before and immediately after giving effect thereto, the following statements
must be true and correct, and the making by Borrower of the applicable Advance
Request will constitute Borrower’s representation and warranty that on and as of
the date of such Advance Request and as of the date of the requested Borrowing,
before and immediately after giving effect thereto, the following statements are
and will be true and correct:
(i)    The representations and warranties contained in Article IV of this
Agreement are and will be true and correct in all material respects as though
made on and as of such date, unless such representations and warranties are
expressly stated to be made as of an earlier date;
(ii)    No event has occurred and is continuing or would result from the
requested Advance that constitutes or would constitute a Default or an Event of
Default;
(iii)    Borrower is and will be in compliance with all covenants contained in
Articles V and VI of this Agreement;

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(iv)    The representations, warranties and covenants contained in Section 5 of
the Guaranty are and will be true and correct in all material respects as though
made on and as of such date, unless such representations and warranties are
expressly stated to be made as of an earlier date; and
(v)    Guarantor is and will be in compliance with all covenants contained in
Section 6 of the Guaranty.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants to Lender as follows:

Section 4.1    Organization. Borrower is duly organized and validly existing
under the laws of the jurisdiction of its organization. Borrower has full power
and authority to own its properties and to transact the businesses in which it
is presently engaged or presently proposes to engage.

Section 4.2    Authorization; No Breach. The execution, delivery, and
performance of this Agreement and the other Loan Documents by Borrower, to the
extent to be executed, delivered or performed by Borrower, have been duly
authorized by all necessary corporate, limited liability company, partnership or
similar action, as applicable; do not require the consent or approval of any
other Person, regulatory authority or governmental body; and do not conflict
with, result in a violation of, or constitute a default under (a) any provision
of Borrower’s organizational documents, or any agreement or (b) any law,
governmental regulation applicable to Borrower.

Section 4.3    Legal Effect. This Agreement and the other Loan Documents
constitute legal, valid and binding obligations of Borrower and the other
parties thereto (other than Lender) enforceable against Borrower and such other
parties in accordance with their respective terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors’ rights generally and
to general principles of equity (whether considered in a proceeding at law or in
equity).

Section 4.4    Information. All information furnished by Borrower or any
Subsidiary to Lender in connection with this Agreement or any transaction
contemplated hereby is, and all information hereafter furnished by or on behalf
of Borrower or any Subsidiary to Lender will be, true and accurate in every
material respect on the date as of which such information is dated or certified;
and none of such information is or will be incomplete by omitting to state any
material fact necessary to make such information not misleading, provided,
however, that the Borrower shall

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not be in breach of this representation and warranty, and shall have no
liability for any failure of the information furnished to Lender to be accurate
or complete, to the extent such information was prepared by the Advisor or the
Subadvisor.

Section 4.5    Survival of Representations and Warranties. Borrower understands
and agrees that Lender, without independent investigation, is relying upon the
above representations and warranties in entering into this Agreement and the
other Loan Documents. Such representations and warranties will be continuing in
nature and will remain true and correct until all of Borrower’s Indebtedness
under this Agreement has been paid in full, and Lender’s Commitment to make
Advances under this Agreement has been permanently terminated in writing.

ARTICLE V

COVENANTS

Section 5.1    Additional Covenants. So long as the Note or any other amount
payable by Borrower or Guarantor under the Loan Documents remains unpaid,
Guarantor covenants and agrees that:
(a)    Intentionally Omitted;
(b)    Borrower will not (with respect to itself or the Guarantor) (i) permit a
Change of Control to occur; or (ii) merge, dissolve, liquidate, consolidate with
or into another Person, or dispose of (whether in one transaction or in a series
of transactions or pledge) all or substantially all of its (except when the
stock of a Borrower Subsidiary is being sold in an equity transaction whereby
the underlying purpose of the transaction is to dispose of real property) to or
in favor of any Person; and
(c)    Borrower shall not (with respect to itself, Borrower Subsidiaries or the
Guarantor) directly or indirectly create, incur, assume or suffer to exist any
Indebtedness, except:
(i)    the Loan;
(ii)    Secured Indebtedness by Borrower Subsidiaries; and
(iii)    in connection with any Secured Indebtedness by Borrower Subsidiaries,
any unsecured obligations (contingent or otherwise) existing or arising under
any Swap Contract, provided that (i) such obligations are (or were) entered into
by such Person in the ordinary course of business for the purpose of directly
mitigating risks associated with fluctuations

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in interest rates or foreign exchange rates and (ii) such Swap Contract does not
contain any provision exonerating the non-defaulting party from its obligation
to make payments to the defaulting party on outstanding transactions.

ARTICLE VI

DEFAULT AND REMEDIES

Section 6.1    Events of Default. Each of the following events will constitute
an event of default (“Event of Default”) under this Agreement, provided,
however, that the following events shall not constitute an Event of Default to
the extent they are caused by any action or inaction by the Advisor or the
Subadvisor:
(a)    Default on Indebtedness to Lender.
(i)    Any regular monthly payment of interest under this Agreement or any other
amount payable pursuant to this Agreement or the other Loan Documents (excluding
principal and interest due on the Maturity Date) is not paid so that it is
received by Lender within 15 days after the date when due, or
(ii)    Any outstanding principal or interest on the Loan is not paid on or
before the Maturity Date.
(b)    Covenant Default.
(i)    Violation of any of the covenants contained in Article V of this
Agreement, or
(ii)    Failure by Borrower or any Affiliate of Borrower to perform, keep, or
observe any other material term, provision, condition, covenant, or agreement
contained in this Agreement, in any of the other Loan Documents, or in any other
present or future agreement between Borrower or such Affiliate on the one hand
and Lender or any Affiliate of Lender on the other hand, and as to any such
failure that can be cured and does not pose an imminent risk of loss to Lender,
the failure of Borrower or such Affiliate to cure such Default within 30 days
after Borrower receives written notice thereof from Lender or after any officer,
member, manager or partner of Borrower or such Affiliate becomes aware thereof;
provided, however, that if the Default cannot by its nature be cured within the
30 day period or cannot after diligent attempts by Borrower or such Affiliate be
cured within such 30 day period, and such Default is likely to be cured within a
reasonable time, then Borrower or such Affiliate will have an additional
reasonable period (which will not in any

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case exceed an additional 30 days) to attempt to cure such failure, and within
such reasonable time period the failure to have cured such failure will not be
deemed an Event of Default (provided that Lender will have no obligation to make
Advances during such cure period).
(c)    Insolvency. If (i) Borrower, any Borrower Subsidiary, or Guarantor
becomes insolvent, (ii) an Insolvency Proceeding is commenced by Borrower, any
Subsidiary or Guarantor, or (iii) an Insolvency Proceeding is commenced against
Borrower, any Subsidiary or Guarantor and is not dismissed or stayed within 60
days (provided that no Advances will be made prior to the dismissal of such
Insolvency Proceeding).
(d)    Other Agreements. If there is a default under any agreement to which
Borrower any Borrower Subsidiary, or Guarantor is a party with a third party
resulting in a right by such third party, whether or not exercised, to
accelerate the maturity of any Indebtedness in an amount in excess of
$20,000,000.
(e)    Judgments. If a judgment or judgments for the payment of money in an
amount, individually or in the aggregate, of $20,000,000 or more will be
rendered against Borrower, any Borrower Subsidiary, or Guarantor and will remain
unsatisfied and unstayed for a period of 30 days.
(f)    Misrepresentations. If any material misrepresentation or material
misstatement now or hereafter exists in any representation or warranty set forth
in this Agreement or in any certificate or Advance Request submitted to Lender
in connection with the Loan.
(g)    Full Force and Effect, Defective Documentation, Etc. If this Agreement or
any of the other Loan Documents ceases to be in full force and effect, at any
time and for any reason, or Borrower, any Subsidiary or Guarantor repudiates any
Loan Document or asserts that any Loan Document is not in full force and effect.

Section 6.2    Remedies. At any time after the occurrence and during the
continuance of an Event of Default, Lender may, by notice to Borrower, (a)
declare the obligation of Lender to make Advances to be terminated, whereupon
the same will forthwith terminate, (b) exercise any and all rights under the
Pledge Agreement and foreclose on the Collateral in accordance with the terms
thereof, and (c) declare (i) the Note and all interest thereon and (ii) all
other amounts payable under this Agreement and the other Loan Documents to be
immediately due and payable, whereupon the Note, all such interest, and all such
other amounts will become and be immediately due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by Borrower; provided, however, that if an Insolvency
Proceeding by or against

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Borrower is commenced, (A) the obligation of Lender to make Advances will
automatically be terminated and (B) the Note, all interest thereon, and all
other amounts payable under this Agreement and the other Loan Documents will
automatically become and be immediately due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by Borrower.

Section 6.3    Right of Offset. After the occurrence and during the continuance
of an Event of Default, Lender and its Affiliates are hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other Indebtedness at any time owing by Lender or
its Affiliates to or for the credit or the account of Borrower or any Subsidiary
against any and all of the obligations of Borrower or any Subsidiary now or
hereafter existing under this Agreement and the other Loan Documents
irrespective of whether Lender has made any demand. The rights of Lender under
this Section are in addition to other rights and remedies (including, without
limitation, other rights of offset) that Lender may have.

Section 6.4    Cumulative Remedies. After the occurrence and during the
continuance of an Event of Default, Lender may proceed to enforce the Loan
Documents by exercising such remedies as are available thereunder or in respect
thereof under applicable law, whether for specific performance of any covenant
or other agreement contained in the Loan Documents or in aid of the exercise of
any power granted in the Loan Documents. No remedy conferred in this Agreement
or the other Loan Documents is intended to be exclusive of any other remedy, and
each and every such remedy will be cumulative and will be in addition to every
other remedy conferred herein or therein or now or hereafter existing at law, in
equity, by statute or otherwise.

Section 6.5    Application of Payments. After the occurrence and during the
continuance of an Event of Default, Lender will apply all funds received in
respect of amounts owing under this Agreement and the other Loan Documents in
such order as Lender may determine in its sole discretion notwithstanding any
instruction from Borrower or any other Person.

ARTICLE VII

TRANSFERS

Section 7.1    Assignment by Lender. Lender may at any time assign all or a
portion of its rights and obligations under this Agreement. The consent of the
Borrower (such consent not to be unreasonably withheld or delayed) shall be
required unless (x) a Default or Event of Default shall exist at the time of
such assignment or (y) such assignment is to an Affiliate of a Lender; provided,
however, that the Borrower shall be deemed to have consented to any such
assignment unless it

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shall object thereto by written notice to the Lender within 10 Business Days
after having received notice thereof;

ARTICLE VIII

MISCELLANEOUS

Section 8.1    Amendments. An amendment or waiver of any provision of this
Agreement or the other Loan Documents, or a consent to any departure therefrom,
will be effective against Lender if, but only if, it is in writing and signed by
Lender, and then such a waiver or consent will be effective only in the specific
instance and for the specific purpose for which given.

Section 8.2    Notices. Except as otherwise specifically provided in this
Agreement, all notices and other communications provided for under this
Agreement must be in writing and mailed, telecopied or otherwise transmitted or
delivered to the recipient at its address as set forth in Schedule 1; or at such
other address within the United States as may be designated by such party in a
written notice to the other party or parties. All such notices and
communications will, (a) if mailed, be effective three (3) Business Days
following deposit in the United States mail, postage prepaid; (b) if delivered
by recognized overnight delivery service (such as Federal Express) be effective
upon delivery and (c) if telecopied, be effective when telecopied and electronic
confirmation of transmission is received, except that notices and communications
to Lender pursuant to Article II will not be effective until received by Lender.

Section 8.3    No Waiver; Remedies. No failure on the part of Lender to
exercise, and no delay in exercising, any right under this Agreement or any
other Loan Document will operate as a waiver thereof; nor will any single or
partial exercise of any right hereunder or under any other Loan Document
preclude any other or further exercise thereof or the exercise of any other
right. The remedies provided in this Agreement and the other Loan Documents are
cumulative and not exclusive of any remedies provided by law.

Section 8.4    Costs and Expenses; Indemnification.
(a)    Costs of Preparation and Administration of Loan Documents. Whether or not
the transactions provided for in this Agreement are consummated, Borrower will
pay on demand: (i) the reasonable fees and out of pocket expenses of counsel for
Lender in connection with the preparation, execution and delivery of this
Agreement and the other Loan Documents and any amendments or modifications
thereof or waivers or consents with respect thereto, in an amount not to exceed
$100,000 (ii) any and all out-of-pocket costs and expenses reasonably incurred
by Lender

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in connection with the execution and delivery of this Agreement and the other
Loan Documents and the administration thereof.
(b)    Costs of Enforcement. In the event of any Default or Event of Default, or
in the event that any dispute arises (whether or not such dispute is with
Borrower) relating to the interpretation, enforcement or performance of this
Agreement or any of the other Loan Documents, or Lender’s rights thereunder,
Lender will be entitled to collect from Borrower on demand all reasonable fees
and expenses incurred in connection therewith, including but not limited to fees
of attorneys, paralegals, accountants, expert witnesses, arbitrators, mediators
and court reporters. Without limiting the generality of the foregoing, Borrower
will pay all such costs and expenses incurred in connection with: (i)
arbitration or other alternative dispute resolution proceedings, trial court
actions and appeals; (ii) bankruptcy or other Insolvency Proceedings of
Borrower, any Subsidiary or any party having any interest in any security for
the Loan (if any); (iii) judicial or nonjudicial foreclosure on, or appointment
of a receiver for, any property securing the Loan (if any); (iv) post-judgment
collection proceedings; (v) all claims, counterclaims, cross-claims and defenses
asserted in any of the foregoing whether or not they arise out of or are related
to this Agreement or any other Loan Document; (vi) all preparation for any of
the foregoing; and (vii) all settlement negotiations with respect to any of the
foregoing.
(c)    Survival. The provisions of this section will survive the termination of
the commitment to lend under this Agreement and the repayment of the Loan and
all other amounts payable under the Loan Documents.

Section 8.5    Binding Effect; Assignments and Participations. This Agreement
will become effective when it has been executed by Borrower and Lender and
thereafter will be binding upon and inure to the benefit of Borrower and Lender
and their respective successors and assigns, except that Borrower will not have
the right to assign its rights under this Agreement or any interest herein
without the prior written consent of Lender. Lender may assign or grant
participations in or to all or any part of its rights and obligations under this
Agreement and the other Loan Documents.

Section 8.6    Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by different parties on separate counterparts, each
of which when so executed will be deemed to be an original and all of which
taken together will constitute one and the same agreement.

Section 8.7    Governing Law. This Agreement will be governed by, and construed
and enforced in accordance with, the laws of the State of New York, without
reference to the choice of law principles of the State of New York.

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Section 8.8    Service of Process. Borrower irrevocably consents to service of
process in the manner provided for notices herein. Nothing in this Agreement
will affect the right of Lender to serve process in any other manner permitted
by law.

Section 8.9    Consent to Jurisdiction. Borrower hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any United States Federal or New York State court sitting in the
Borough of Manhattan, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement, or for recognition or
enforcement of any judgment, and Borrower hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by law, in
such Federal court. Borrower hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that Lender may otherwise have
to bring any action or proceeding relating to this Agreement against Borrower or
its properties in the courts of any jurisdiction. Borrower hereby irrevocably
and unconditionally waives, to the fullest extent it may legally and effectively
do so, any objection which it may now or hereafter have to the laying of venue
of any suit, action or proceeding arising out of or relating to this Agreement
in any court referred to in subsection (b) above. Borrower hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.

Section 8.10    Waiver of Jury Trial. EACH OF BORROWER AND LENDER (FOR ITSELF
AND ITS SUCCESSORS, ASSIGNS AND PARTICIPANTS) WAIVES ITS RIGHT TO A TRIAL BY
JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON, ARISING OUT OF OR RELATED TO
THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS PROVIDED FOR HEREIN
OR THEREIN, IN ANY LEGAL ACTION OR PROCEEDING OF ANY TYPE BROUGHT BY ANY PARTY
TO ANY OF THE FOREGOING AGAINST ANY OTHER SUCH PARTY, WHETHER SOUNDING IN
CONTRACT, TORT OR OTHERWISE. ANY SUCH CLAIM OR CAUSE OF ACTION WILL BE TRIED BY
A COURT SITTING WITHOUT A JURY.

Section 8.11    No Fiduciary Duty. Borrower acknowledges that Lender has no
fiduciary relationship with, or fiduciary duty to, Borrower arising out of or in
connection with this Agreement or any of the other Loan Documents, and the
relationship between Lender and Borrower in connection herewith or therewith is
solely that of creditor and debtor. None of this Agreement or the other Loan
Documents create a joint venture among the parties.

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Section 8.12    Severability. Any provision of the Loan Documents that is
prohibited or unenforceable in any jurisdiction will be ineffective to the
extent of such prohibition or unenforceability in such jurisdiction without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties waive any provision of law that renders
any provision of this Agreement or any other Loan Document prohibited or
unenforceable in any respect.

Section 8.13    Entire Agreement. This Agreement and the other Loan Documents
constitute the final and complete expression of the parties with respect to the
transactions contemplated by this Agreement and replace and supersede all prior
discussions, negotiations and understandings with respect thereto. Neither this
Agreement nor any term hereof nor of the other Loan Documents may be changed,
waived, discharged or terminated except as provided herein.

Section 8.14    Descriptive Headings. The descriptive headings of the various
provisions of this Agreement are for convenience of reference only, do not
constitute a part hereof, and will not affect the meaning or construction of any
provision hereof.

Section 8.15    Gender and Number. Whenever appropriate to the meaning of this
Agreement or the other Loan Documents, use of the singular will be deemed to
refer to the plural, the use of the plural to the singular, and pronouns of
certain gender to either or both the other genders.
[Remainder of page intentionally left blank]

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IN WITNESS WHEREOF, Borrower and Lender have caused this Agreement to be
executed by their duly authorized officers and representatives effective as of
the day first above written.
                        
LENDER:
 
 
W. P. Carey Inc., a Maryland corporation
 
 
 
 
By:
/s/ ToniAnn Sanzone
 
Name: ToniAnn Sanzone
 
Title: Managing Director and Chief Financial Officer

[signatures continue on following page]

[Lender Signature Page to Loan Agreement]

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BORROWER:
 
 
CWI 2 OP, LP, a Delaware limited partnership
 
 
By:
Carey Watermark Investors 2 Incorporated,
 
a Maryland Corporation, its general partner
 
 
By:
/s/ Michael G. Medzigian
 
Name: Michael G. Medzigian
 
Title: President & Chief Executive Officer

[Borrower Signature Page to Loan Agreement]

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SCHEDULE 1

NOTICE ADDRESSES
Notice address for Borrower:
CWI 2 OP, LP
c/o W. P. Carey Inc.
50 Rockefeller Plaza, 2nd Floor
New York, NY 10020
Attention: Chief Financial Officer

Carey Watermark Investors Inc.
150 North Riverside Plaza, Suite 4200
Chicago, IL 60606
Attention: Michael Medzigian

Notice address for Lender:
W. P. Carey Inc.
50 Rockefeller Plaza, 2nd Floor
New York, NY 10020
Attn: Chief Financial Officer – Managed Funds

With copy to:
W. P. Carey Inc.
50 Rockefeller Plaza, 2nd Floor
New York, NY 10020
Attn: Director, Legal Transactions

[Schedule 1 to Loan Agreement]

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EXHIBIT A

ADVANCE REQUEST
W. P. Carey Inc.
50 Rockefeller Plaza, 2nd Floor
New York, NY 10020
Attn: Chief Financial Officer – Managed Funds

Date: ______________, 2017
This refers to the Loan Agreement dated as of August __, 2017 (the “Loan
Agreement”) (capitalized terms used herein and not otherwise defined have the
meanings given to them in the Loan Agreement), between the undersigned
(“Borrower”) and W. P. Carey Inc. (“Lender”), and hereby gives Lender notice,
irrevocably, pursuant to Section 2.2 of the Loan Agreement that Borrower hereby
requests a Borrowing under the Loan Agreement, and in that connection sets forth
below the information relating to such Borrowing (the “Requested Borrowing”) as
required by the Loan Agreement:
REQUESTED BORROWING
(i)    The Business Day on which the Requested Borrowing is to be made is
__________, 2017.
(ii)    The aggregate amount of the Requested Borrowing is $__________, and the
outstanding principal balance of the Loan is $_____________.
CERTIFICATIONS
The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the Requested Borrowing, before and
immediately after giving effect thereto and to the application of the proceeds
therefrom:
A.
The representations and warranties contained in Article IV of the Loan Agreement
are true and correct as though made on and as of such dates, unless such
representations and warranties are expressly stated to be made as of an earlier
date;

B.
Borrower is in full compliance with all covenants contained in Articles V and VI
of the Loan Agreement; and

C.
No event has occurred and is continuing, or would result from such Requested
Borrowing, that constitutes or would constitute an Event of Default or a Default
under the Loan Agreement.

D.
The representations, warranties and covenants contained in Section 5 of the
Guaranty are and will be true and correct in all material respects as though
made on and as of such date,

[Exhibit A to Loan Agreement]

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unless such representations and warranties are expressly stated to be made as of
an earlier date; and
E.
Guarantor is and will be in compliance with all covenants contained in Section 6
of the Guaranty.

Very truly yours,
 
 
CWI 2 OP, LP
 
 
By: Carey Watermark Investors Incorporated,
its general partner
 
 
By:
 
 
 
Name:
Title:

[Exhibit A to Loan Agreement]