Exhibit 10.30.5

      SMBC CAPITAL MARKETS, INC.   (LOGO) [d69970d6997003.gif]

Sumitomo Mitsui Banking Corporation Group
CONFIRMATION

     
Date:
  July 1, 2009
 
   
To:
  Ashford Hospitality LP
 
  14185 Dallas Parkway
 
  Suite 1150
 
  Dallas, TX 75254
 
  United States
 
   
 
  Attention: Doug Kessler
 
  Phone: 972.778.9452
 
  Fax:
 
   
cc:
  Chatham Financial Corporation
 
  Attention: Randy Medina
 
  10901 West Toller Drive, #301
 
  Littleton, CO 80127
 
  United States
 
  Phone: 720.221.3515
 
  Fax: 720.221.3519
 
   
From:
  SMBC Capital Markets, Inc.
 
  277 Park Avenue, Fifth Floor
 
  New York, New York 10172
 
   
cc:
  Documentation Contact: Irina Bababekov
 
  Tel: 212.224.5088
 
  Fax: 212.224.4959
 
  Email: confirms@smbc-cm.com

Re:   USD 1,800,000,000.00 Rate Protection Transaction, dated as of July 1, 2009
between SMBC Capital Markets, Inc. (“Party A”) and Ashford Hospitality LP
(“Party B”).

Our Reference Number: A970618
The purpose of this letter agreement is to confirm the terms and conditions of
the Interest Rate Protection Transaction entered into between Party A and Party
B on the Trade Date specified below (the “Rate Protection Transaction”). This
letter agreement constitutes a “Confirmation” as referred to in the ISDA Form
specified below. This document supersedes all previous confirmations and
amendments with respect to the above referenced transaction.
          The parties agree that Items 1, 3, and 4 of this Long-form
Confirmation constitute a “Confirmation” as referred to in the ISDA Form
(defined below) and Item 2 of this Long-form Confirmation constitutes a
“Schedule” as referred to in the ISDA Form.

          277 Park Avenue New York, NY 10172   PHONE: 212-224-5063 FAX:
212-224-4958   Email: schinest@smbc-cm.com

 

--------------------------------------------------------------------------------

 

      Page 2   A970618

          The parties further agree that the Confirmation set forth at Items 1,
3 and 4 hereof shall supplement, form a part of, and be subject to an agreement
in the form of the ISDA Master Agreement (Multicurrency — Cross Border) as
published and copyrighted in 1992 by the International Swaps and Derivatives
Association, Inc. (the “ISDA Form”), as if Party A and Party B had executed an
agreement in such form on the date hereof, with a Schedule as set forth in
Item 2 of this Long-form Confirmation. The Transaction described herein shall be
the sole Transaction governed by such ISDA Form.
          This Long-form Confirmation incorporates by reference the definitions
and provisions contained in the 2000 ISDA Definitions (the “2000 Definitions”)
as published by the International Swaps and Derivatives Association, Inc.
(“ISDA”). In the event of any inconsistency between this Long-form Confirmation
and the 2000 Definitions or the ISDA Form, this Long-form Confirmation will
govern. Any reference to a “Swap Transaction” in the 2000 Definitions is deemed
to be a reference to a “Transaction” for purposes of this Agreement, and any
reference to a “Transaction” in this Agreement is deemed to be a reference to a
“Swap Transaction” for purposes of the 2000 Definitions.
          Each reference herein to a “Section” or to a “Section” “of this
Agreement” will be construed as a reference to a Section of the ISDA Form and
each reference herein to a “Part” will be construed as a reference to the
Schedule to the ISDA Form.
Item 1. Terms of Rate Protection Transaction.

     
Party A:
  SMBC Capital Markets, Inc.
 
   
Party B:
  Ashford Hospitality LP
 
   
Trade Date:
  July 1, 2009
 
   
Effective Date:
  December 14, 2009
 
   
Termination Date:
  December 13, 2010 subject to adjustment in accordance with the Modified
Following Business Day Convention
 
   
Notional Amount:
  USD 1,800,000,000.00
 
   
Floating Amounts 1:
   
 
   
Floating Rate Payer:
  Party A
 
   
Floating Rate Calculation Periods:
  The Floating Rate Calculation Periods will be from and including the
thirteenth (13th) of each month to but excluding the thirteenth (13th) of the
following month beginning with the Effective Date and continuing up to but
excluding the Termination Date, subject to adjustment in accordance with the
Modified Following Business Day Convention.
 
   
Floating Rate Payer Payment Dates:
  The thirteenth (13th) calendar day of each month beginning with January 13,
2010 continuing up to and including December 13, 2010, subject to adjustment in
accordance with the Modified Following Business Day Convention
 
   
Floating Rate Option:
  USD-LIBOR-BBA
 
   
Designated Maturity:
  One Month

 

--------------------------------------------------------------------------------

 

      Page 3   A970618

     
Spread:
  Inapplicable
 
   
Floating Rate Day Count Fraction:
  Actual/360
 
   
Reset Dates:
  First (1st) day of each Floating Rate Calculation Period
 
   
Compounding:
  Inapplicable
 
   
Floor Rate:
  1.75000% (per cent) per annum
 
   
Floating Amounts 2:
   
 
   
Floating Rate Payer:
  Party B
 
   
Floating Rate Calculation Periods:
  The Floating Rate Calculation Periods will be from and including the
thirteenth (13th) of each month to but excluding the thirteenth (13th) of the
following month beginning with the Effective Date and continuing up to but
excluding the Termination Date, subject to adjustment in accordance with the
Modified Following Business Day Convention.
 
   
Floating Rate Payer Payment Dates:
  The thirteenth (13th) calendar day of each month beginning with January 13,
2010 continuing up to and including December 13, 2010, subject to adjustment in
accordance with the Modified Following Business Day Convention
 
   
Floating Rate Option:
  USD-LIBOR-BBA
 
   
Designated Maturity:
  One Month
 
   
Spread:
  Inapplicable
 
   
Floating Rate Day Count Fraction:
  Actual/360
 
   
Reset Dates:
  First (1st) day of each Floating Rate Calculation Period
 
   
Compounding:
  Inapplicable
 
   
Floor Rate:
  1.25000% (per cent) per annum
 
   
Business Days for Payments by both parties:
  New York
 
   
Calculation Agent:
  SMBC Capital Markets, Inc.
 
   
Fixed Amounts:
   
 
   
Fixed Rate Payer:
  Party B
 
   
Fixed Rate Payer Payment Date:
  July 3, 2009
 
   
Fixed Amount:
  USD 7,094,000.00

 

--------------------------------------------------------------------------------

 

      Page 4   A970618

2. Additional Provisions.

  (a)   “Specified Entity” will not apply to Party A and will not apply to Party
B.     (b)   Specified Transaction will have the meaning specified in Section 14
of the ISDA Form.     (c)   The “Cross Default” provisions of Section 5(a)(vi)
of the ISDA Form will not apply to Party A or Party B.     (d)   The “Credit
Event Upon Merger” provisions of Section 5(b)(iv) of the ISDA Form will not
apply to Party A or Party B.     (e)   The “Automatic Early Termination”
provision of Section 6(a) of the ISDA Form will not apply to Party A or Party B.
    (f)   Payments on Early Termination. For the purpose of Section 6(e) of the
ISDA Form:         Market Quotation and the Second Method will apply       (g)  
“Termination Currency” means U.S. Dollars.     (h)   “Additional Termination
Event” will not apply to Party A and will not apply to Party B.     (i)   Tax
Representations:

  (a)   Payer Representation. For the purposes of Section 3(e) of the ISDA Form:
        Party A and Party B each makes the following representation:

It is not required by any applicable law, as modified by the practice of any
relevant governmental revenue authority, of any Relevant Jurisdiction to make
any deduction or withholding for or on account of any Tax from any payment
(other than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made by it to the other party under this Agreement. In making this
representation, it may rely on: (i) the accuracy of any representations made by
the other party pursuant to Section 3(f) of this Agreement; (ii) the
satisfaction of the agreement of the other party contained in Section 4(a)(i) or
4(a)(iii) of this Agreement and the accuracy and effectiveness of any document
provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii) of this
Agreement; and (iii) the satisfaction of the agreement of the other party
contained in Section 4(d) of this Agreement.

  (b)   Payee Representation. For the purposes of Section 3(f) of the ISDA Form:
        Party A makes the following representation:

It is a corporation organized under the laws of the State of Delaware with its
principal place of business in the State of New York and its Taxpayer
Identification Number is 13-3380138.

      Party B makes the following representation:

It is a limited partnership organized under the laws of the State of Delaware
with its principal place of business in the State of Texas and its Taxpayer
Identification Number is 86-1062192.

  (ii)   Other Payee Representations: None.

 

--------------------------------------------------------------------------------

 

      Page 5   A970618

(j)   Agreement to Deliver Documents.

     For the purposes of Section 4(a)(i) and (ii) of the ISDA Form, each party
agrees to deliver the following documents, as applicable:

  (a)   Tax forms, documents or certificates to be delivered are: as requested.
    (b)   Other documents to be delivered are:

              Party Required to       Date By Which To   Covered Deliver
Document   Form / Document / Certificate   Be Delivered   by 3(d)
Party A & Party B
  Certificate of signing authority and specimen signatures of each individual
executing this Confirmation   Upon execution of and delivery of this
Confirmation   Yes
 
           
Party A
  Certified copies of all corporate resolutions authorizing the execution of
this Confirmation   Upon execution of and delivery of this Confirmation   Yes
 
           
Party A
  A duly executed guaranty of the Credit Support Provider of Party A   Upon
execution of and delivery of this Confirmation   Yes

(k)   Addresses for Notices.

Address for notices or communications to Party A:
For the purpose of Section 12(a) of the ISDA Form:
SMBC Capital Markets, Inc.
277 Park Avenue, Fifth Floor
New York, New York 10172
USA
Attention: President

Facsimile No.:   (212)224-4959
(212) 224-5111 (for payment and reset notices)

Telephone No.: (212) 224-5021
Address for notices or communications to Party B:
For all purposes:

To:   Ashford Hospitality LP
14185 Dallas Parkway
Suite 1150
Dallas, TX 75254
United States
Attention: Doug Kessler
Phone: 972.778.9452
Fax:

 

--------------------------------------------------------------------------------

 

      Page 6   A970618

     
cc:
  Chatham Financial Corporation
 
  Attention: Randy Medina
 
  10901 West Toller Drive, #301
 
  Littleton, CO 80127
 
  United States
 
  Phone: 720.221.3515
 
  Fax: 720.221.3519

(l)   Process Agent. For the purpose of Section 13(c) of the ISDA Form:

Party A appoints as its Process Agent:

Not applicable

Party B appoints as its Process Agent:       Not applicable   (m)   Offices. The
provisions of Section 10(a) of the ISDA Form will not apply to this
Confirmation.   (n)   Multibranch Party. For the purpose of Section 10(c) of the
ISDA Form:

Party A is not a Multibranch Party.
Party B is not a Multibranch Party.

(o)   Credit Support Document. Details of any Credit Support Document:      
With respect to Party A, Credit Support Document means: the Guaranty of the
Credit Support Provider of Party A

With respect to Party B, Credit Support Document means: none.   (p)   Credit
Support Provider.       With respect to Party A, Credit Support Provider means:
Sumitomo Mitsui Banking Corporation

With respect to Party B, Credit Support Provider means: none.   (q)   Governing
Law. This Agreement will be governed by and construed in accordance with the
laws of the State of New York (without reference to choice of law doctrine).  
(r)   Netting of Payments. Subparagraph (ii) of Section 2(c) of the ISDA Form
will apply to this Transaction in each case starting from the date of this
Confirmation.   (s)   “Affiliate” will have the meaning specified in Section 14
of the ISDA Form, provided that Party A shall have, or be deemed to have, no
Affiliates for the purposes of this Confirmation.   (t)   Waiver of Jury Trial.
Each party waives, to the fullest extent permitted by applicable law, any right
it may have to a trial by jury in respect of any suit, action, or proceeding
relating to this Confirmation or any Credit Support Document. Each party
(1) certifies that no representative, agent, or attorney of the other party or
any Credit Support Provider has represented, expressly or otherwise, that such
other party would not, in the event of such a suit, action or proceeding,

 

--------------------------------------------------------------------------------

 

      Page 7   A970618

    seek to enforce the foregoing waiver and (2) acknowledges that it and the
other party have been induced to enter into this Confirmation and provide for
any Credit Support Document, as applicable, by, among other things, the mutual
waivers and certifications in this Section.   (u)   The parenthetical clause in
Section 4(a)(iii) of the ISDA Form will not apply to either Party A or Party B.
  (v)   For the purpose of Section 6(e), Set-off will not apply.   (w)  
Notification of Recording of Telephone Conversations. Each party hereby notifies
the other that telephone conversations between the parties will be recorded, and
each party consents to such recording and to such recording being produced in
evidence in court proceedings.   (x)   Fully-paid Transactions.

     (i) The condition precedent in Section 2(a)(iii)(l) of the ISDA Form does
not apply to a payment and delivery owing by a party if the other party shall
have satisfied in full all its payment or delivery obligations under
Section 2(a)(i) of the ISDA Form and shall at the relevant time have no further
payment or delivery obligations, whether absolute or contingent under
Section 2(a)(i) of the ISDA Form.
     (ii) Notwithstanding the terms of Section 5 and 6 of the ISDA Form if at
any time and so long as one of the parties to this Confirmation (“X”) shall have
satisfied in full all its payment and delivery obligations under Section 2(a)(i)
of the ISDA Form and shall at the time have no future payment or delivery
obligations, whether absolute or contingent under such Section, then unless the
other party (“Y”) is required pursuant to appropriate proceedings to return to X
or otherwise returns to X upon demand of X any portion of any such payment or
delivery, (a) the occurrence of an event described in Section 5(a) of the ISDA
Form with respect to X any Credit Support Provider of X or any Specified Entity
of X shall not constitute an Event of Default or a Potential Event of Default
with respect to X as the Defaulting Party and (b) Y shall be entitled to
designate an Early Termination Date pursuant to Section 6 of the ISDA Form only
as a result of the occurrence of a Termination Event set forth in Section
(5)(b)(i) of the ISDA Form with respect to Y as the Affected Party.
     (iii) This agreement (including, without limitation, the ISDA Form
incorporated herein for the purpose of governing only the Transaction evidenced
by this Confirmation) shall govern only the Transaction evidenced by this
Confirmation.

(y)   Additional Representations. Section 3(a) of the ISDA Form is hereby
amended by the deletion of “and” at the end of sub-clause (iv), the insertion of
a semicolon in place at the end of sub-clause (v) thereof and the addition of
the following new subclauses:

(vi) Agency. It is entering into this Confirmation and the Transaction as
principal and not as agent of any person;
(vii) Non-Reliance. It is acting for its own account, and has made its own
independent decisions to enter into the Transaction and as to whether the
Transaction is appropriate or proper for it based upon its own judgment and upon
advice from such advisors as it has deemed necessary. It is not relying on any
communication (written or oral) of the other party as investment advice or as a
recommendation to enter into the Transaction; it being understood that
information and explanations related to the terms and conditions of a
Transaction shall not be considered investment advice or a recommendation to
enter into the Transaction. No communication (written or oral) received from the
other party shall be deemed to be an assurance or guarantee as to the expected
results of the Transaction;

 

--------------------------------------------------------------------------------

 

      Page 8   A970618

(viii) Assessment and Understanding. It is capable of assessing the merits of
and understanding (on its own behalf or through independent professional
advice), and understands and accepts, the terms, conditions and risks of the
Transaction. It is also capable of assuming, and assumes, the risks of the
Transaction;
(ix) Status of Parties. The other party is not acting as a fiduciary for or an
advisor to it in respect of the Transaction; and
(x) Eligible Contract Participant. It is an “eligible contract participant” as
defined in the U.S. Commodity Exchange Act.

(bb)   Collateral Assignment. Party A consents to a collateral assignment of
this Confirmation and the transaction evidenced thereby (if requested) and
agrees to execute separate consents as may be reasonably requested by the
parties to such agreements.

(cc)   Assignment. Party B can assign its position in the transaction (in whole
or in part) to any other third party with Party A’s consent, which will not
unreasonably be withheld or delayed.

3.   Early Termination:

    Provided that no Event of Default, Potential Event of Default or Termination
Event has occurred, Party B may terminate this Transaction, in whole or in part,
on any Business Day (such day the “Optional Termination Date”) by providing at
least two (2) Business Days’ prior notice of its election to terminate this
Transaction. In the event of such termination, Party A and Party B shall attempt
to agree on the amount owed in connection with such termination using the then
current swap rate as of the Optional Termination Date and no funding charges,
capital charge, or spread to LIBOR will apply. If Party A and Party B fail to
reach agreement, the amount due with respect to such termination shall be
determined in accordance with Section 17.3 of the 2000 ISDA Definitions as if
(a) the Cash Settlement Method is Cash Price, (b) the Cash Settlement Payment
Date is the Optional Termination Date, (c) the Quotation Rate is Mid, and
(d) Cash Settlement Reference Banks are to be agreed mutually by Party A and
Party B. Notwithstanding Section 17.3(a) of the 2000 ISDA Definitions, if fewer
than three quotations are provided, or three banks agreed to, then Party A and
Party B will attempt to arrange for an assignment of Party B’s rights and
obligations under the Transaction to a mutually agreed upon Reference
Market-maker. If Party A and Party B cannot agree upon, or are not able to
effect, an assignment then the Cash Settlement Amount will be the average of the
amounts determined by each of the parties, determined in good faith and in a
commercially reasonable manner.

4.   Payment Instructions.

Payments to Party A of USD amounts:

     
Depository:
  JPMorgan Chase Bank, N.A. New York Branch
ABA Routing No.:
  021000021
In Favor Of:
  SMBC Capital Markets, Inc.
Account No.:
  544-7-77993

    Please contact Larry Weissblum of our Operations Group if you have any
questions concerning SMBC Capital Markets, Inc’s payment instructions referenced
above (Telephone: 212-224-5061; Telefax: 212-224-5111).       Payments to Party
B of USD amounts: PLEASE PROVIDE   5.   Counterparts. This Confirmation may be
executed in any number of counterparts, each of which shall constitute an
original and all of which together shall constitute one and the same agreement
and may be executed by facsimile.

 

--------------------------------------------------------------------------------

 

      Page 9   A970618

Please confirm that the foregoing correctly sets forth the terms of the
agreement between you and us by executing this Confirmation and returning it to
the documentation contact above.
Yours Sincerely,
Party A:
By: SMBC Capital Markets, Inc.

                  By:   /s/ Larry Weissblum         Name:   Larry Weissblum     
  Title:   Senior Vice President              By:   /s/ Danny Boodram        
Name:   Danny Boodram        Title:   Vice President     

Party B:
By: Ashford Hospitality LP

                  By:   /s/ David Brooks         Name:   David Brooks        
Title:   COO - Chief Operating Officer     

 

--------------------------------------------------------------------------------

 

AUTHORIZATION
and
INCUMBENCY CERTIFICATE
for
Ashford Hospitality LP
I hereby certify on this lst day of July 2009 that Ashford Hospitality LP is
permitted to enter into derivative transaction(s) including but not limited to
interest rate swaps, caps and floors (“transactions”) for the purposes of
hedging.

          Name:   Title:   Signature:
 
       
 
       
 
       
 
       
 
       
 
       

IN WITNESS WHEREOF, the undersigned certifies that the person(s) signing above
are authorized to transact and bind Ashford Hospitality LP in hedging
transaction(s). Each of the persons listed above has been authorized to transact
on behalf of Ashford Hospitality LP and is duly elected to and now holds the
office set forth opposite his or her name and the signature of each person set
forth opposite his or her respective name is a true and genuine signature. I
have hereunto signed my name as of this 1st day of July 2009.

                  By:           Name:           Title:   Secretary (or other
authorized individual; title must be provided in such case)*
* This individual cannot be included on the list above.