Exhibit 10.1

EXECUTION VERSION

PURCHASE AND SALE AGREEMENT

by and between

173ODRE9 GL OWNER, LLC, a Delaware limited liability company,

as Seller

and

BREIT DAVIS PROPERTY OWNER LLC, a Delaware limited liability company,

as Buyer

Effective Date: January 20, 2017

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TABLE OF CONTENTS

 

         Page  

ARTICLE 1       CERTAIN DEFINITIONS

     1   

SECTION 1.1.

 

Definitions

     1   

SECTION 1.2.

 

Terms Generally

     12   

ARTICLE 2       SALE OF PROPERTY

     12   

SECTION 2.1.

 

Sale of Property

     12   

SECTION 2.2.

 

Intentionally Omitted

     13   

SECTION 2.3.

 

Intentionally Omitted

     13   

SECTION 2.4.

 

Cash at Closing

     13   

SECTION 2.5.

 

Submission Matters

     13   

ARTICLE 3       TITLE MATTERS

     14   

SECTION 3.1.

 

Required Removal Exceptions

     14   

SECTION 3.2.

 

Delivery of Title and Title Insurance

     14   

ARTICLE 4       INVESTIGATIONS; AS-IS SALE

     14   

SECTION 4.1.

 

Investigations

     14   

SECTION 4.2.

 

Inspection

     14   

SECTION 4.3.

 

Intentionally Omitted

     14   

SECTION 4.4.

 

As-Is Provisions

     14   

SECTION 4.5.

 

Limitation on Seller’s Liability

     18   

ARTICLE 5       ADJUSTMENTS AND PRORATIONS

     19   

SECTION 5.1.

 

Prorations, Credits and Other Adjustments

     19   

SECTION 5.2.

 

Safe Deposit Boxes

     23   

SECTION 5.3.

 

Inventory of Baggage

     24   

SECTION 5.4.

 

Closing Costs

     24   

ARTICLE 6       CLOSING

     25   

SECTION 6.1.

 

Closing Mechanics

     25   

SECTION 6.2.

 

Seller’s Closing Deliveries

     25   

SECTION 6.3.

 

Buyer’s Closing Deliveries

     26   

SECTION 6.4.

 

Conditions to Buyer’s Obligations

     27   

SECTION 6.5.

 

Conditions to Seller’s Obligations

     28   

SECTION 6.6.

 

Waiver of Failure of Conditions Precedent

     28   

ARTICLE 7       REPRESENTATIONS AND WARRANTIES

     28   

SECTION 7.1.

 

Buyer’s Representations

     28   

SECTION 7.2.

 

Seller’s Representations

     30   

SECTION 7.3.

 

General Provisions

     33   

 

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TABLE OF CONTENTS

(continued)

 

         Page  

ARTICLE 8       COVENANTS

     34   

SECTION 8.1.

 

Intentionally Omitted

     34   

SECTION 8.2.

 

Brokers

     34   

SECTION 8.3.

 

Publicity

     34   

SECTION 8.4.

 

Confidentiality

     35   

SECTION 8.5.

 

Intentionally Omitted

     35   

SECTION 8.6.

 

Employees

     35   

SECTION 8.7.

 

Termination of Hotel Management Agreement

     36   

SECTION 8.8.

 

Books and Records

     36   

SECTION 8.9.

 

Reporting and Audit Under Ground Lease

     36   

SECTION 8.10.

 

Repair Work

     37   

ARTICLE 9       INTENTIONALLY OMITTED

     38   

ARTICLE 10     INTENTIONALLY OMITTED

     38   

ARTICLE 11     MISCELLANEOUS

     38   

SECTION 11.1.

 

Intentionally Omitted

     38   

SECTION 11.2.

 

Survival/Merger

     38   

SECTION 11.3.

 

Integration; Waiver

     38   

SECTION 11.4.

 

Governing Law

     38   

SECTION 11.5.

 

Captions Not Binding; Exhibits and Schedules

     38   

SECTION 11.6.

 

Binding Effect

     38   

SECTION 11.7.

 

Severability

     38   

SECTION 11.8.

 

Notices

     39   

SECTION 11.9.

 

Counterparts; Electronic Signatures

     41   

SECTION 11.10.

 

No Recordation

     41   

SECTION 11.11.

 

Additional Agreements; Further Assurances

     41   

SECTION 11.12.

 

Construction

     41   

SECTION 11.13.

 

Attorneys’ Fees

     41   

SECTION 11.14.

 

Time of Essence

     41   

SECTION 11.15.

 

Jurisdiction

     41   

SECTION 11.16.

 

Waiver of Jury Trial

     42   

SECTION 11.17.

 

Releases

     42   

SECTION 11.18.

 

Lead Paint

     42   

SECTION 11.19.

 

Bulk Sale; Tax Clearance Certificates

     42   

SECTION 11.20.

 

Natural Hazard Disclosures

     43   

EXHIBIT A – LEGAL DESCRIPTION OF REAL PROPERTY

  

EXHIBIT B – UNION CONTRACTS

  

EXHIBIT C – ESCROW PROVISIONS

  

EXHIBIT D – FORM OF GROUND LEASE ASSIGNMENT AGREEMENT

  

EXHIBIT E – FORM OF BILL OF SALE

  

EXHIBIT F – FORM OF OMNIBUS ASSIGNMENT AND ASSUMPTION AGREEMENT

  

EXHIBIT G – FORM OF FIRPTA AFFIDAVIT

  

EXHIBIT H – INTENTIONALLY DELETED

  

 

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TABLE OF CONTENTS

(continued)

 

         Page  

EXHIBIT I – FORM OF OWNER’S AFFIDAVIT

  

EXHIBIT J – INTENTIONALLY DELETED

  

EXHIBIT K – FORM OF LANDLORD CONSENT

  

EXHIBIT L – FORM OF LANDLORD ESTOPPEL CERTIFICATE

  

EXHIBIT M – FORM OF ESCROW HOLDBACK AGREEMENT

  

EXHIBIT N – FORM OF KEY MONEY GUARANTY ASSIGNMENT

  

EXHIBIT O – MANAGER SERVICE CONTRACTS

  

EXHIBIT P – OWNER SERVICE CONTRACTS

  

SCHEDULE 5.1(j) – VOUCHERS

  

SCHEDULE 7.2(d) – LITIGATION

  

SCHEDULE 7.2(e) – CONTRACTS

  

SCHEDULE 7.2(f) – COMPLIANCE WITH LAW

  

SCHEDULE 7.2(g) – LEASED PERSONAL PROPERTY

  

SCHEDULE 7.2(r) – LICENSES AND PERMITS

  

SCHEDULE 7.2(o) – BOOKINGS

  

 

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PURCHASE AND SALE AGREEMENT

THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is made to be effective as
of January 20, 2017 (the “Effective Date”) by and between 173ODRE9 GL OWNER,
LLC, a Delaware limited liability company (“Seller”), and BREIT DAVIS PROPERTY
OWNER LLC, a Delaware limited liability company (“Buyer”).

W I T N E S S E T H:

In consideration of the mutual covenants and agreements set forth herein the
parties hereto do hereby agree as follows:

ARTICLE 1

CERTAIN DEFINITIONS

SECTION 1.1.    Definitions. In addition to terms defined elsewhere in this
Agreement, as used herein, the following terms shall have the following
meanings:

“ABC” shall have the meaning given in Section 8.8.

“Accounts Receivable” shall have the meaning given in Section 5.1(d)(ii).

“Adjusted Purchase Price” shall have the meaning given in Section 2.4.

“Adjusting Party” shall have the meaning given in Section 5.1(m).

“Agreement” shall have the meaning given in the preamble hereto.

“Alcoholic Beverages” shall mean all alcoholic beverages held for sale to Hotel
guests and others in the Ordinary Course or otherwise used in the operation of
the Hotel (including the contents of any in-room service bars and mini-bars),
subject to the depletion and restocking that occurs in the Ordinary Course.

“Assignment of Ground Lease Documents” shall mean that certain Assignment and
Assumption of Ground Lease Documents dated as of June 30, 2014 by and among
Original Lessee, The Regents and Seller.

“Assumed Liabilities” shall have the meaning given in Section 4.4(c).

“Bookings” shall mean, as of the time of Closing, all contracts or reservations
for the use or occupancy of guest rooms, meeting and banquet facilities at the
Hotel, including all deposits received by or on behalf of Seller with respect
thereto.

“Business Day” shall mean any day other than Saturday, Sunday, any Federal
holiday, or any day in the State of New York or the State of California when
banks are closed. If any period expires or action is to be taken on a day that
is not a Business Day, the time frame for the same shall be extended until the
next Business Day.

“Buyer” shall have the meaning given in the preamble hereto.

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“Buyer’s Knowledge” or words of similar import shall refer only to the actual
knowledge of Brian Kim (the “Buyer’s Designated Representative”). There shall be
no personal liability on the part of the Buyer Designated Representative arising
out of any of the Buyer’s Warranties.

“Buyer’s Representatives” shall mean, collectively, Buyer and any officers,
directors, employees, agents, consultants, contractors, advisors, affiliates,
representatives and attorneys of Buyer, or any direct or indirect owner of any
beneficial interest in Buyer.

“Buyer’s Warranties” shall mean, collectively, Buyer’s representations and
warranties set forth in Section 7.1.

“Campus Services Agreement” shall mean that certain Campus Services Agreement
dated as of August 18, 2008 by and between Original Lessee and The Regents, as
assigned to Seller pursuant to that certain Assignment of Ground Lease
Documents.

“Cap Amount” shall have the meaning given in Section 4.5(a).

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, 42 U.S.C. §§9601 et seq., as amended by SARA (Superfund
Amendment and Reauthorization Act of 1986) and as the same may be further
amended from time to time.

“Closing” shall mean the closing of the Transaction.

“Closing Date” shall mean the day that the Transaction closes in accordance with
this Agreement.

“Closing Documents” shall mean all documents executed and delivered by Buyer or
Seller as required by Section 6.2 and Section 6.3 or as otherwise executed and
delivered by Buyer or Seller as part of Closing.

“Closing Statement” shall have the meaning given in Section 5.1.

“Closing Tax Year” shall have the meaning given in Section 5.1(a).

“COBRA” shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985,
as the same may be amended from time to time.

“Confidentiality Agreement” shall have the meaning given in Section 8.4.

“Consumables” shall mean any engineering, maintenance and housekeeping supplies
used in the operation and maintenance of the Hotel, subject to depletion and
restocking in the Ordinary Course, and any guest toiletries, including, but not
limited to, soap, cleaning materials, stationery, printing supplies and other
supplies. “Consumables” shall not include any (a) Food and Beverage Inventory,
(b) Operating Equipment, (c) items of personal property owned by Hotel Manager,
guests, Employees, Leased Employees or others (unless such person owns such
property for the account or benefit of Seller) or (d) Protected Personal
Property.

 

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“Contracts” shall mean all service agreements, maintenance contracts, equipment
leasing agreements, warranties, guarantees, bonds, open purchase orders and
other contracts for the provision of labor, services, materials or supplies
relating to the Hotel or FF&E, together with all renewals, supplements,
amendments and modifications thereof, and any new such agreements entered into
after the Effective Date pursuant to the terms hereof. “Contracts” shall not
include (a) any insurance policies held by Seller, (b) the Bookings, (c) the
Hotel Management Agreement, (d) the Franchise Agreement, and (e) the Ground
Lease Documents.

“Cut-Off Revenue Time” shall have the meaning given in Section 5.1(d).

“Cut-Off Time” shall have the meaning given in Section 5.1(b).

“Deferred Adjustment Items” shall have the meaning given in Section 5.1(m).

“Easements” shall mean Seller’s leasehold estate in all easements, covenants and
other rights appurtenant to the Real Property and all right, title and interest
of the Seller, if any, in and to any land lying in the bed of any street, road,
avenue or alley, open or closed, in front of or adjoining the Real Property and
to the center line thereof.

“Election to Proceed” shall have the meaning given in Section 4.1(a).

“Employee Liabilities” shall mean all obligations and Liabilities, actual or
contingent, with respect to Employees, including, without limitation, for
(a) worker’s compensation claims, state unemployment insurance, state disability
insurance or similar private or public unemployment or disability compensation
arrangements and (b) claims under applicable Laws governing employer/employee
relations (including, without limitation, anti-discrimination laws, the WARN
Act, ERISA, the Occupational Health and Safety Act and COBRA).

“Employees” shall mean all current employees employed at or for the Property
(including employees shared with other hotels, if applicable), by Hotel Manager
or any affiliate thereof, as of the Closing Date, irrespective of whether such
individuals are active, on leaves of absence or otherwise inactive but still
employed at or for the Property, but not including the Leased Employees.

“Employee Services Agreement” shall mean, collectively, that certain Amended and
Restated Employee Services Agreement dated as of July 30, 2012 by and between
Original Lessee and The Regents, as assigned to Hotel Manager pursuant to that
certain Assignment and Assumption of Employee Services Agreement dated as of
June 30, 2014 by and between Original Lessee and Hotel Manager.

“Employee Services Liabilities” shall mean all amounts payable to The Regents
pursuant to the Employee Services Agreement, including an allowance for accrued
but unused vacation, and other liabilities of the “Tenant” thereunder (which is
currently Hotel Manager pursuant to the assignment referenced in the definition
of “Employee Services Agreement” above).

“Environmental Liabilities” shall have the meaning given in Section 4.4(b).

 

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“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended.

“Escrow Agent” shall mean Chicago Title Insurance Company, in its capacity as
escrow agent, whose mailing address is 711 3rd Avenue, Suite 500, New York, New
York 10017, Attention: Neal J. Miranda, (212-880-1237, neal.miranda@ctt.com).

“Escrow Holdback Agreement” shall have the meaning given in Section 4.5(b).

“FF&E” shall mean all fixtures, furniture and equipment, including, without
limitation all furnishings, fittings, cars, trucks, machinery, apparatus,
signage, appliances, draperies, art work, carpeting, keys, computer hardware and
equipment, IT hardware systems, reservations terminals to the extent not
licensed to Seller, building materials, telephones and or other communications
equipment, copiers, facsimile machines, postal machines, televisions, signs,
vacuum cleaners, video equipment and other similar articles of property located
in or used in connection with the operation of the Hotel, but not including any
(a) Protected Materials, (b) property owned by guests, Hotel Manager, Franchisor
or other third parties, (c) Leased Personal Property, (d) Consumables,
(e) Operating Equipment or (f) Protected Personal Property.

“Financial Information” shall have the meaning given in Section 8.8.

“Floor Amount” shall have the meaning given in Section 7.3(b).

“Food and Beverage Inventory” shall mean all food and beverage (alcoholic and
non-alcoholic) held for sale to Hotel guests and others in the Ordinary Course
or otherwise used in the operation of the Hotel (including the alcoholic
beverage and other contents of any in-room service bars and mini-bars), subject
to the depletion and restocking that occurs in the Ordinary Course. “Food and
Beverage Inventory” shall not include Alcoholic Beverages if any applicable
governmental regulation requires a separate sale and transfer of the Alcoholic
Beverages.

“Franchise Agreement” shall mean that certain Hyatt Place Hotel Franchise
Agreement dated as of June 30, 2014, by and between Seller, as franchisee, and
Franchisor and any amendments or supplements thereto.

“Franchisor” shall mean Hyatt Place Franchising, L.L.C., a Delaware limited
liability company.

“GAAP” shall mean generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board (or agencies with similar functions of
comparable stature and authority within the accounting profession), or in such
other statements by such entity as may be in general use by significant segments
of the U.S. accounting profession.

“Ground Lease” shall mean, collectively, as the same may be amended, assigned or
replaced from time to time, that certain Ground Lease dated as of August 18,
2008 between Original Lessee, as ground lessee, and The Regents, as ground
lessor, as amended by that certain First Amendment to Ground Lease dated as of
June 15, 2012 between Original Lessee and The

 

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Regents, as amended by that certain Consent to Assignment and Assumption of and
Amendment to Ground Lease Documents dated as of June 30, 2014 by and among
Original Lessee, The Regents and Seller, and as assigned to Seller pursuant to
the Assignment of Ground Lease Documents.

“Ground Lease Assignment Agreement” shall have the meaning given in
Section 6.2(a).

“Ground Lease Documents” shall mean, collectively, the Ground Lease, the Campus
Services Agreement, the Employee Services Agreement and the Infrastructure
Agreement.

“Hotel” shall mean that certain one hundred twenty-seven (127) room hotel and
related improvements commonly known as of the Effective Date as the Hyatt Place,
UC Davis, located at 173 Old Davis Road Extension, Davis, California 95616.

“Hotel Management Agreement” shall mean that certain Management Agreement dated
as of June 23, 2014, by and between Seller and Hotel Manager and any amendments
or modifications thereof.

“Hotel Manager” shall mean InnVentures IVI LP, a Delaware limited partnership.

“Hotel Manager Records” shall mean any books and records relating to the Hotel
that are owned or maintained by Hotel Manager with respect to Seller’s period of
ownership. “Hotel Manager Records” shall exclude any Protected Materials.

“Hotel Owner Records” shall mean any books and records relating to the Hotel
that are owned or maintained by Seller. “Hotel Owner Records” shall exclude any
Protected Materials.

“Hotel Payables” shall have the meaning given in Section 5.1(f).

“Hotel Records” shall mean, collectively, (a) the Hotel Owner Records and
(b) the Hotel Manager Records, but only to the extent that the consent or
approval of Hotel Manager to the transfer of such Hotel Manager Records has been
obtained by Seller prior to the Scheduled Closing Date.

“Infrastructure Agreement” shall mean, collectively, that certain Infrastructure
Agreement entered into by Original Lessee and The Regents dated as of August 18,
2008, as assigned to Seller pursuant to that certain Assignment of Ground Lease
Documents.

“Intangible Property” shall mean all (a) trademarks, trade names, service marks,
fictitious business names, logos or other names, marks or designs used
exclusively in connection with the operation of the Hotel, together with the
goodwill associated with the use thereof, (b) telephone exchange numbers and
websites identified with the Hotel, and (c) all other intangible property of
whatever nature used by Seller exclusively in connection with the ownership and
operation of the Hotel, but excluding in connection with any and all of the
foregoing any Protected Materials, Protected Personal Property and any of the
foregoing that is proprietary to Franchisor or Hotel Manager and any
intellectual property owned by Franchisor or Hotel Manager.

“Internal Revenue Code” shall have the meaning given in Section 7.1(f).

 

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“Inventory” shall mean all articles of personal property that are held for
resale and situated at the Hotel on the Closing Date, including inventory held
for sale in any gift shop or news stand operated by Seller or Hotel Manager,
subject to depletion and restocking that occurs in the Ordinary Course, but
excluding: (a) Consumables, (b) Operating Equipment, (c) Food and Beverage
Inventory and (d) Protected Personal Property.

“Key Money Guaranty Assignment” shall have the meaning given in Section 6.2(n).

“Key Money Repayment Obligation” shall mean the obligation to repay the
Unamortized Key Money (as such term is defined in the Franchise Agreement) to
Franchisor pursuant to Section 6.10 of the Franchise Agreement.

“Landlord Consent” shall have the meaning given in Section 6.2(b).

“Landlord Estoppel Certificate” shall have the meaning given in Section 6.2(c).

“Laws” shall mean, collectively, all municipal, county, State or Federal
statutes, codes, ordinances, laws, rules or regulations applicable to Seller,
Buyer or the Property.

“Leased Employees” shall mean all Landlord Leased Employees (as such term is
defined in the Employee Services Agreement) providing services to the Hotel
pursuant to the Employee Services Agreement.

“Leased Personal Property” shall mean any items listed in the definition of
“FF&E” that are leased rather than owned by Seller or Hotel Manager.

“Leasehold Interests” shall mean Seller’s interest in, to and under the Ground
Lease Documents.

“Liabilities” shall mean, collectively, any and all losses, costs, damages,
claims, liabilities, expenses (including reasonable attorneys’ fees), fees,
penalties, demands or obligations of any kind or nature whatsoever, including
Employee Liabilities and Employee Services Liabilities.

“Licenses and Permits” shall mean, collectively, all licenses, permits,
certificates of occupancy, approvals, dedications, subdivision maps and
entitlements now or hereafter issued, approved or granted by any governmental
authority in connection with the Hotel or the operation of the Hotel, together
with all renewals and modifications thereof. “Licenses and Permits” shall not
include the Liquor License.

“Liquor License” shall mean any existing alcoholic beverage license held by
Liquor Licensee in connection with operation of the Hotel.

“Liquor Licensee” shall mean InnVentures F&B Services, LLC, a California limited
liability company.

“Manager Service Contracts” shall mean the agreements listed in Exhibit O.

 

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“New Franchise Agreement” shall have the meaning given in Section 5.4.

“New Management Agreement” means the hotel management agreement between Buyer
and Hotel Manager.

“Official Records” shall have the meaning given in the definition of “Permitted
Exceptions”.

“Omnibus Assignment and Assumption Agreement” shall have the meaning given in
Section 6.2(e).

“Operating Equipment” shall mean all china, glassware, linens, towels, bedding,
upholstery material, carpets, rugs, silverware, uniforms and other “operating
inventory” (as defined in the Uniform System of Accounts) situated at the Hotel
on the Closing Date that are owned by Seller and are used or held in reserve
storage for future use in connection with the operation of the Hotel, subject to
the depletion and restocking that occurs in the Ordinary Course, excluding any
Protected Personal Property.

“Ordinary Course” shall mean the normal course of day-to-day operations of the
Hotel, in a manner that does not materially vary from the policies, practices
and procedures in effect as of the Effective Date, but taking into account the
termination of the Hotel Management Agreement and, if applicable, hotel
management transition to occur at or prior to Closing, as contemplated by this
Agreement.

“Original Lessee” shall mean University Hospitality Group, LLC, a California
limited liability company.

“Other Taxes” shall have the meaning given in Section 7.2(n).

“Outside Accountants” shall have the meaning given in Section 5.1(n).

“Owner Service Contracts” shall mean the agreements listed in Exhibit P.

“Owner’s Title Policy” shall mean a 2006 ALTA owner’s leasehold title insurance
policy issued by the Title Company in an aggregate amount equal to the Purchase
Price.

“Permitted Exceptions” shall mean and include all of the following:
(a) applicable zoning, building and land use Laws and any other exception that
is required to be recorded by any governmental authority pursuant to applicable
Laws, (b) the lien of taxes, assessments and other governmental charges or fees
not yet due and payable, (c) the Ground Lease Documents and any memorandum
recorded in the Official Records of Yolo County (the “Official Records”) which
references the Ground Lease Documents or any one of them; (d) any exceptions
caused by any Buyer’s Representative or agreed to in writing by Buyer, (e) any
exception that the Title Company agrees to affirmatively insure over in
accordance with the terms hereof, and (f) those matters set forth on Schedule B
to the Title Commitment and items disclosed by the Survey, which Buyer accepts
or is deemed to have accepted in accordance with Section 3.1 below.

 

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“Personal Property” shall mean (a) the items of tangible personal property
consisting of all FF&E, Consumables, Food and Beverage Inventory, Operating
Equipment, Inventory and other tangible personal property of every kind and
nature located at the Hotel and owned or leased by Seller, and (b) the items of
intangible personal property consisting of all the Intangible Property, the
Bookings, the Hotel Records and the Licenses and Permits, in each case excluding
any Protected Materials. To the extent any of the foregoing categories of
property may consist of both tangible and intangible property, “Personal
Property” shall include all of the personal property encompassed by such
category, notwithstanding any classification of such property as tangible or
intangible.

“PIP” shall have the meaning given in Section 8.5.

“Post-Closing Statement” shall have the meaning given in Section 5.1(m).

“Prior Tax Years” shall have the meaning given in Section 5.1(o).

“Proceedings” shall have the meaning given in Section 11.15.

“Prohibited Person” shall have the meaning given in Section 7.1(c).

“Property” shall have the meaning given in Section 2.1.

“Protected Materials” shall mean (a) any books, records or files (whether in a
printed or electronic format) that consist of the following: Seller’s, Hotel
Manager’s or Franchisor’s organizational documents or files or records relating
thereto; appraisals; strategic plans for the Property; internal analyses;
information regarding the marketing of the Property for sale; submissions
relating to obtaining internal authorization for the sale of the Property by
Seller or any direct or indirect owner of any beneficial interest in Seller;
attorney and accountant work product; attorney-client privileged documents;
internal correspondence of Seller, Hotel Manager, Franchisor or any direct or
indirect owner of any beneficial interest in Seller, Hotel Manager, Franchisor
or any of their respective affiliates and correspondence between or among such
parties; or other information in the possession or control of Seller, Hotel
Manager, Franchisor or any direct or indirect owner of any beneficial interest
in Seller, Hotel Manager or Franchisor which is proprietary or privileged under
applicable Laws; (b) any other proprietary materials, including proprietary
management systems, software data and computer hardware that are used in
connection with the proprietary management systems and accounting systems,
including any software owned by Hotel Manager or Franchisor, and any
intellectual property of Hotel Manager or Franchisor; and (c) any service marks,
trademarks, trade names, insignias and logos owned by Hotel Manager or
Franchisor or their respective affiliates.

“Protected Personal Property” shall mean any tangible personal property (located
at the Property or otherwise used for Hotel services) bearing any service marks,
trademarks, trade names, insignias or logos used for Hotel services, for other
related goods and services and for the Hotel business associated therewith that
contain the name of Hotel Manager or Franchisor or by reason of extent of usage
are associated with hotels operated by Hotel Manager or Franchisor or their
affiliates.

“Purchase Price” shall have the meaning given in Section 2.1.

 

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“RCRA” shall mean the Resource Conservation and Recovery Act of 1976, 42 U.S.C.
§§6901 et seq., as the same may be amended from time to time.

“Real Property” shall mean, collectively, the Hotel and the Leasehold Interests,
as more particularly described on Exhibit A attached hereto.

“Remove” with respect to any exception to title shall mean that Seller causes
the Title Company to remove of record or affirmatively insure over the same in a
manner reasonably acceptable to Buyer, provided that with respect to Required
Removal Exceptions, Buyer shall have no obligation to accept affirmative
insurance.

“Repair Work” shall have the meaning given in Section 8.10.

“Replacement Reserve Fund” shall mean the replacement reserve fund maintained in
accordance with the requirements of Section 4.3 of the Ground Lease.

“Requesting Party” shall have the meaning given in Section 5.1(m).

“Required Removal Exceptions” shall mean, collectively, (i) any mortgage, deed
of trust, assignment of leases and rents, or other monetary lien placed on the
Property by Seller and affecting all or any portion of the Property, (ii) any
mechanic’s or similar liens for work performed at the Property at Seller’s
request, (iii) any judgment liens against Seller or the Property that are not
caused by Buyer or any other Buyer’s Representatives of up to One Hundred Fifty
Thousand Dollars ($150,000) in the aggregate and (iv) any other monetary liens
on the Property of up to One Hundred Fifty Thousand Dollars ($150,000) in the
aggregate that are not Permitted Exceptions or that are not caused by Buyer or
any other Buyer’s Representatives.

“Retained Liabilities” shall mean: (i) any Employee Liabilities or Employee
Services Liabilities that accrued with respect to the period of Seller’s
ownership of the Property, except to the extent that Buyer receives a credit for
any such Employee Liability or Employee Services Liability at Closing;
(ii) third party tort and contract claims for personal injury that arise out of
events occurring prior to the Closing Date during Seller’s ownership of the
Property (except that Seller does not retain any Environmental Liabilities or
any Liabilities related to the physical, structural or environmental condition
of the Property); (iii) Liabilities of Seller accruing prior to the Closing Date
during Seller’s ownership of the Property under the Ground Lease Documents, the
Franchise Agreement, the Hotel Management Agreement and the Contracts, except to
the extent that Buyer receives a credit therefor at Closing; (iv) Liabilities of
Seller accruing prior to the Closing Date during Seller’s ownership of the
Property for Sales Taxes and Other Taxes, except to the extent that Buyer
receives a credit therefor at Closing; and (v) any other Liabilities pertaining
to the period prior to the Closing Date during Seller’s ownership of the
Property with respect to which Seller receives a credit at Closing, but only to
the extent of such credit. For clarity, Retained Liabilities shall not include
any Environmental Liabilities or any matters relating to the structural,
physical or environmental condition of the Property, which Buyer is deemed to
take the Property subject to as provided in Section 4.4 and for which Buyer is
releasing Seller of any Liability, and any item for which Buyer receives a
credit at Closing.

 

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“ROFO Waiver” shall mean a waiver of the Right of Offer (as defined in the
Ground Lease) under Section 3.13.1 of the Ground Lease in connection with the
Transaction contemplated by this Agreement.

“ROFR Waiver” shall mean a waiver of the Right of Refusal (as defined in the
Ground Lease) under Section 3.13.2 of the Ground Lease in connection with the
Transaction contemplated by this Agreement.

“Sales Taxes” shall have the meaning given in Section 11.19(b).

“Scheduled Closing Date” shall mean January 20, 2017.

“Seller” shall have the meaning given in the preamble hereto.

“Seller Indemnified Parties” shall mean and include, collectively, (a) Seller;
(b) any direct or indirect owner of any beneficial interest in Seller; and
(c) any officer, director, member, manager, partner, advisor, shareholder,
employee, representative, affiliate or agent of Seller, or of any direct or
indirect owner of any beneficial interest in Seller.

“Seller Parties” shall mean and include, collectively, (a) Seller;
(b) Franchisor; (c) The Regents; (d) any direct or indirect owner of any
beneficial interest in Seller; (e) Liquor Licensee; (f) Seller’s existing
mortgage lender; and (g) any officer, director, member, manager, partner,
advisor, shareholder, employee, representative, affiliate or agent of Seller,
Franchisor, The Regents, Liquor Licensee, Seller’s existing mortgage lender or
of any direct or indirect owner of any beneficial interest in Seller.

“Seller Release Parties” shall mean and include, collectively, (a) Seller;
(b) Franchisor; (c) any direct or indirect owner of any beneficial interest in
Seller; (d) Seller’s existing mortgage lender; and (e) any officer, director,
member, manager, partner, advisor, shareholder, employee, representative,
affiliate or agent of Seller, Franchisor, Seller’s existing mortgage lender or
of any direct or indirect owner of any beneficial interest in Seller.

“Seller’s Broker” shall mean HFF.

“Seller’s Knowledge” or words of similar import shall refer only to the actual
knowledge of Matt Kenney and Hewitt Engram (the “Designated Representative”) and
shall not be construed to impose upon the Designated Representative any other
duty to investigate the matters to which such knowledge, or the absence thereof,
pertains, including, but not limited to, the contents of the materials delivered
or made available to Buyer’s Representatives or the contents of files maintained
by the Designated Representative. There shall be no personal liability on the
part of the Designated Representative arising out of any of the Seller’s
Warranties.

“Seller’s Warranties” shall mean, collectively, Seller’s representations and
warranties set forth in Sections 7.2 and 8.2 of this Agreement, as such
representations and warranties may be deemed modified, qualified or waived by
Buyer pursuant to the terms of Section 7.3 of this Agreement.

 

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“Submission Matters” shall have the meaning given in Section 2.5.

“Survey” shall mean the survey prepared by Red Plains Surveying Company for
Partner Engineering and Science, Inc. as Partner Project Number 16-177654.1,
last revised January 12, 2017.

“Survival Period” shall have the meaning given in Section 7.3(c).

“Taxes” shall have the meaning given in Section 5.1(a).

“The Regents” shall mean The Regents of the University of California, a
California public corporation.

“Title Commitment” shall mean the Chicago Title Insurance Company Title
Commitment No. 00065643-001-TG3-DB, with an effective date of December 1, 2016.

“Title Company” shall mean Chicago Title Insurance Company, whose mailing
address is 711 Third Ave, Suite 500, New York, New York 10017, Attention: Neal
J. Miranda, (212-880-1237, neal.miranda@ctt.com.

“Transaction” shall mean the transaction contemplated by this Agreement.

“Unamortized Key Money” shall have the meaning given in Section 8.5.

“Uniform System of Accounts” shall mean the Eleventh Revised Edition of the
Uniform System of Accounts for the Lodging Industry, published by the
Educational Institute of the American Hotel and Motel Association.

“Union” shall mean the Coalition of University Employees/IBT Local 2010 and the
American Federation of State, County and Municipal Employees.

“Union Contracts” shall mean, collectively, the agreements set forth on Exhibit
B hereto.

“University’s Reimbursed Transaction Expenses” shall have the meaning given to
such term in the Ground Lease.

“Unopened Inventory” shall have the meaning given in Section 5.1(g).

“Vouchers” shall have the meaning given in Section 5.1(j).

“WARN Act” shall mean the Worker Adjustment and Retraining Notification Act and
any similar local or state laws or regulations.

“Warranties” shall mean, to the extent assignable, all warranties, if any,
issued to the Seller by any manufacturer or contractor in connection with
construction or installation of equipment or any component of the improvements
included as part of the Hotel.

“Water Damage Escrow” shall have the meaning given to such term in Section 8.10.

 

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SECTION 1.2.    Terms Generally. Definitions in this Agreement apply equally to
both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. All references herein to Articles, Sections, Schedules and
Exhibits shall be deemed to be references to Articles and Sections of, and
Schedules and Exhibits to, this Agreement unless the context shall otherwise
require. Any accounting term used but not defined herein shall have the meaning
assigned to it in accordance with GAAP, unless the Uniform System of Accounts
shall apply pursuant to the express terms of this Agreement. The words
“include”, “includes” and “including” shall be deemed to be followed by the
phrase “without limitation” unless such phrase already appears. The terms
“herein”, “hereof” and “hereunder” and other words of similar import refer to
this Agreement as a whole and not to any particular section, paragraph or
subdivision.

ARTICLE 2

SALE OF PROPERTY

SECTION 2.1.    Sale of Property. Subject to the terms of this Agreement and the
Closing Documents, Seller agrees to sell and Buyer agrees to purchase all of
Seller’s right, title and interest in and to the following property
(collectively, the “Property”), subject to the Permitted Exceptions:

(a)    the Hotel;

(b)    the Leasehold Interests;

(c)    the FF&E;

(d)    the Operating Equipment;

(e)    the Consumables;

(f)    the Food and Beverage Inventory;

(g)    the Inventory;

(h)    the Contracts, to the extent assignable;

(i)    the Bookings;

(j)    the Licenses and Permits, to the extent assignable;

(k)    the Intangible Property, to the extent assignable;

(l)    the Hotel Records;

(m)    the Easements;

(n)    the Warranties; and

 

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(o)    the Protected Personal Property to the extent Seller has the right to
transfer without any representation or warranty that Seller has the right to
transfer.

Notwithstanding anything to the contrary in this Agreement, the Property shall
not include: (i) the Protected Materials; (ii) the Leased Personal Property;
(iii) items of personal property owned by Hotel Manager, Franchisor, Employees,
Leased Employees, guests of the Hotel or other third parties; (iv) tax deposits,
utility deposits and other deposits held by parties other than Seller; (v) any
tax, insurance, FF&E, capital improvement, working capital and/or other escrows,
impounds, accounts or reserves held by Seller’s lender, Hotel Manager or any
other party (including any Replacement Reserve Fund established or maintained by
Seller under Section 4.3.3 of the Ground Lease); (vi) any portion of or interest
in the Protected Personal Property that Seller does not have the right to
transfer: and (vii) all notes and other evidence of indebtedness (other than
related to Accounts Receivable) issued to Seller as of the Closing Date. In
consideration therefor, Buyer shall pay to Seller Thirty Two Million Two Hundred
Thousand and No/100 Dollars ($32,200,000.00) (the “Purchase Price”), subject to
certain closing adjustments and prorations pursuant to Article 5 hereof. The
Purchase Price shall be paid in accordance with the terms of Section 2.4 hereof.
Seller and Buyer shall exercise commercially reasonable efforts to agree to the
allocation of the Purchase Price among the Real Property, the items of tangible
Personal Property and the items of intangible Personal Property. If Buyer and
Seller cannot agree upon the allocation of the Purchase Price, each party shall
file federal, state and local returns based on each party’s own determination of
the proper allocations of the Purchase Price, each bearing its own consequences
of any discrepancies. A portion of the Purchase Price allocated to the Personal
Property shall be further allocated to the Liquor License and Alcoholic
Beverages, if required pursuant to Section 8.8.

SECTION 2.2.    Intentionally Omitted.

SECTION 2.3.    Intentionally Omitted

SECTION 2.4.    Cash at Closing. On the Scheduled Closing Date, Buyer shall
deposit or cause to be deposited into escrow with the Escrow Agent an amount
equal to the Purchase Price and as prorated and adjusted as set forth in Article
5 and Section 6.1 and as otherwise provided under this Agreement (such amount,
the “Adjusted Purchase Price”), in immediately available funds as more
particularly set forth in Section 6.1. Such funds shall be held and delivered by
Escrow Agent in accordance with the terms of this Agreement and Exhibit C.

SECTION 2.5.    Submission Matters. Buyer acknowledges and agrees that Buyer has
received copies of the following (collectively, the “Submission Matters”):

(a)    Copies of each of the Ground Lease Documents.

(b)    Copies of all Licenses and Permits set forth on Schedule 7.2(r) and the
Liquor License.

(c)    A copy of the Franchise Agreement.

(d)    Copies of all Contracts set forth on Schedule 7.2(e).

 

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(e)    Copies of the Union Contracts.

(f)    A copy of the most recent profit and loss statement prepared by Hotel
Manager with respect to the Hotel and year-end financial statements for the
Hotel by Hotel Manager for 2015 and 2016, to the extent available.

ARTICLE 3

TITLE MATTERS

SECTION 3.1.    Required Removal Exceptions. Buyer acknowledges and agrees that
prior to the Effective Date, Buyer had the opportunity to review the Title
Commitment and the Survey and Buyer hereby approves all exceptions to title
shown in the Title Commitment and all matters shown on the Survey.

SECTION 3.2.    Delivery of Title and Title Insurance. It shall be a condition
to Buyer’s obligation to close the Transaction that the Title Company shall be
irrevocably committed to issue the Owner’s Title Policy to Buyer, insuring that
title to the Real Property is vested in Buyer, subject only to the Permitted
Exceptions. By acceptance of the Ground Lease Assignment Agreement and the
closing of the purchase of the Property, Buyer agrees that Seller shall have
conclusively satisfied its obligations with respect to title to the Property.

ARTICLE 4

INVESTIGATIONS; AS-IS SALE

SECTION 4.1.    Investigations. Buyer acknowledges and agrees that prior to the
Effective Date, Buyer had the opportunity to examine and investigate the
Property, the Submission Matters and all other matters that Buyer deemed
necessary or desirable in connection with its planned acquisition of the
Property and that Buyer has approved the condition of the Property and all
Submission Matters. Any costs incurred by Buyer in examining and investigating
the Property under this Agreement shall be at Buyer’s sole cost and expense.

SECTION 4.2.    Inspection. Buyer acknowledges that prior to the Effective Date,
Buyer’s Representatives conducted such surveys, investigations and inspections
of the Property as Buyer deemed necessary and Buyer has approved all such
surveys, investigations and inspections of the Property and Buyer’s execution of
this Agreement shall constitute Buyer’s election to proceed with the acquisition
of the Property.

SECTION 4.3.    Intentionally Omitted.

SECTION 4.4.    As-Is Provisions.

(a)    As-Is Sale. Buyer acknowledges and agrees that:

(i)    The Property shall be sold, and Buyer shall accept possession of the
Property as of Closing, “AS IS, WHERE IS, WITH ALL FAULTS”, with no right of
setoff or reduction in the Purchase Price, except as expressly set forth to the
contrary in Seller’s Warranties or Seller’s Retained Liabilities or in any
covenants of Seller in this Agreement that expressly survive the Closing.

 

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(ii)    Except for Seller’s Warranties, none of the Seller Parties shall be
deemed to have made any verbal or written representations, warranties, promises
or guarantees (whether express, implied, statutory or otherwise) to Buyer with
respect to the Property, any matter set forth, contained or addressed in the
materials delivered or made available to any Buyer’s Representatives, including
the accuracy and completeness thereof, or the results of Buyer’s due diligence.
Buyer acknowledges and agrees that all materials, data and information delivered
by or on behalf of Seller to Buyer in connection with the Transaction
contemplated hereby are provided to Buyer as a convenience only and that any
reliance on or use of such materials, data or information by Buyer shall be at
the sole risk of Buyer, except to the extent otherwise expressly provided in any
Seller’s Warranties. Without limiting the generality of the foregoing
provisions, except to the extent otherwise expressly provided in any Seller’s
Warranties, Buyer acknowledges and agrees that (a) any environmental, property
condition or other report with respect to the Property that is delivered by or
on behalf of Seller to Buyer shall be for general informational purposes only,
(b) Buyer shall not have any right to rely on any such report delivered by or on
behalf of Seller to Buyer, except at the sole risk of Buyer, but rather will
rely on its own inspections and investigations of the Property and any reports
commissioned by Buyer with respect thereto, and (c) neither Seller, any
affiliate of Seller nor the person or entity that prepared any such report
delivered by or on behalf of Seller to Buyer shall have any liability to Buyer
for any inaccuracy in or omission from any such report or in verbal
communication.

(iii)    Buyer acknowledges and agrees that (A) Buyer has completed such due
diligence as Buyer deems necessary or appropriate in its sole and absolute
discretion, and (B) Buyer has independently confirmed to its satisfaction that
it has received and reviewed all information that it considers material to its
purchase of the Property and/or the Transaction.

(iv)    EXCEPT AS EXPRESSLY SET FORTH IN SELLER’S WARRANTIES, IT IS UNDERSTOOD
AND AGREED THAT SELLER IS NOT MAKING AND HAS NOT AT ANY TIME MADE ANY WARRANTIES
OR REPRESENTATIONS OF ANY KIND OR CHARACTER, EXPRESSED OR IMPLIED, WITH RESPECT
TO THE PROPERTY, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OR
REPRESENTATIONS AS TO HABITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, TITLE, ZONING, TAX CONSEQUENCES, LATENT OR PATENT PHYSICAL OR
ENVIRONMENTAL CONDITION, UTILITIES, OPERATING HISTORY OR PROJECTIONS, VALUATION,
GOVERNMENTAL APPROVALS, THE COMPLIANCE OF THE PROPERTY WITH GOVERNMENTAL LAWS,
THE TRUTH, ACCURACY OR COMPLETENESS OF THE SUBMISSION MATTERS OR ANY OTHER
INFORMATION PROVIDED BY OR ON BEHALF OF SELLER TO BUYER, OR ANY OTHER MATTER OR
THING REGARDING THE PROPERTY. BUYER ACKNOWLEDGES AND AGREES THAT UPON CLOSING
SELLER SHALL SELL AND CONVEY TO BUYER AND BUYER SHALL ACCEPT THE PROPERTY “AS
IS, WHERE IS, WITH ALL FAULTS”, EXCEPT TO THE EXTENT EXPRESSLY PROVIDED
OTHERWISE IN SELLER’S WARRANTIES. BUYER HAS NOT RELIED AND WILL NOT RELY ON, AND
SELLER IS NOT LIABLE FOR OR BOUND BY, ANY EXPRESSED OR IMPLIED

 

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WARRANTIES, GUARANTIES, STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO
THE PROPERTY OR RELATING THERETO MADE OR FURNISHED BY SELLER, HOTEL MANAGER,
FRANCHISOR OR ANY REAL ESTATE BROKER OR AGENT REPRESENTING OR PURPORTING TO
REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN, DIRECTLY OR INDIRECTLY, ORALLY OR
IN WRITING, UNLESS SPECIFICALLY SET FORTH IN SELLER’S WARRANTIES. BUYER
REPRESENTS TO SELLER THAT BUYER HAS CONDUCTED, OR WILL CONDUCT PRIOR TO CLOSING,
SUCH INVESTIGATIONS OF THE PROPERTY, INCLUDING BUT NOT LIMITED TO, THE PHYSICAL
AND ENVIRONMENTAL CONDITIONS THEREOF, AS BUYER DEEMS NECESSARY TO SATISFY ITSELF
AS TO THE CONDITION OF THE PROPERTY AND THE EXISTENCE OR NONEXISTENCE OR
CURATIVE ACTION TO BE TAKEN WITH RESPECT TO ANY HAZARDOUS OR TOXIC SUBSTANCES ON
OR DISCHARGED FROM THE PROPERTY, AND WILL RELY SOLELY UPON SAME AND NOT UPON ANY
INFORMATION PROVIDED BY OR ON BEHALF OF SELLER OR ANY SELLER PARTIES WITH
RESPECT THERETO, OTHER THAN SELLER’S WARRANTIES. UPON CLOSING, BUYER SHALL
ASSUME THE RISK THAT ADVERSE MATTERS, INCLUDING BUT NOT LIMITED TO, CONSTRUCTION
DEFECTS AND ADVERSE PHYSICAL AND ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN
REVEALED BY BUYER’S INVESTIGATIONS OR ANY SUBMISSION MATTERS. BUYER AGREES THAT
SHOULD ANY CLEANUP, REMEDIATION OR REMOVAL OF HAZARDOUS SUBSTANCES OR OTHER
ENVIRONMENTAL CONDITIONS ON THE PROPERTY BE REQUIRED AFTER THE CLOSING DATE,
SUCH CLEAN-UP, REMOVAL OR REMEDIATION SHALL BE THE RESPONSIBILITY OF AND SHALL
BE PERFORMED AT THE SOLE COST AND EXPENSE OF BUYER AND SELLER SHALL NOT BE
LIABLE TO BUYER FOR SUCH CLEAN-UP, REMOVAL OR REMEDIATION. BUYER ACKNOWLEDGES
THAT SELLER SHALL NOT BE LIABLE TO BUYER FOR ANY PROSPECTIVE OR SPECULATIVE
PROFITS, OR SPECIAL, INDIRECT, PUNITIVE OR CONSEQUENTIAL DAMAGES, WHETHER BASED
UPON CONTRACT, TORT OR NEGLIGENCE OR IN ANY OTHER MANNER ARISING FROM THIS
AGREEMENT OR THE TRANSACTION.

(b)    Release. Subject to the last sentence of this Section 4.4(b), by
accepting the Ground Lease Assignment Agreement and closing the Transaction,
Buyer, on behalf of itself, its affiliates and their respective successors and
assigns, shall thereby, and does hereby, release each of the Seller Release
Parties from, and waive any and all Liabilities against each of the Seller
Release Parties for, attributable to, or in connection with the Property and the
Transaction, whether known or unknown, direct or indirect, arising or accruing
before, on or after Closing and whether attributable to events or circumstances
that arise or occur before, on or after Closing, including the following:
(i) any and all statements or opinions heretofore or hereafter made, or
information furnished with respect to the Property to any Buyer’s
Representatives, whether by any of the Seller Parties or any of their respective
affiliates, employees, officers, directors, members, partners, agents,
representatives or direct or indirect owners; (ii) any and all Liabilities with
respect to the structural, physical, or environmental condition of the Property,
including all Liabilities relating to the release, presence, discovery or
removal of any hazardous or regulated substance, chemical, waste or material
that may be located in, at, about, emanating from,

 

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migrating to, or under the Property, or connected with or arising out of any and
all claims or causes of action based upon CERCLA, RCRA, any state or local
counterparts thereof, any regulations promulgated thereunder, or any related
claims or causes of action (collectively, “Environmental Liabilities”); (iii)
any implied or statutory warranties or guaranties of fitness, merchantability or
any other statutory or implied warranty or guaranty of any kind or nature
regarding or relating to any portion of the Property and (iv) any and all
Liabilities with respect to the Repair Work, but in no event does the foregoing
release include claims of Buyer resulting from fraud or other willful misconduct
of Seller or the Seller Parties. Notwithstanding the foregoing, the provisions
of this Section 4.4(b) shall not reduce, modify or limit Seller’s obligations
provided herein with respect to Seller’s Warranties (except if waived in
accordance with Section 7.3 of this Agreement) or Seller’s Retained Liabilities
or any covenants of Seller in this Agreement that expressly survive the Closing.

(c)    Assumption of Liability. By accepting the Ground Lease Assignment
Agreement and closing the Transaction, Buyer shall thereby and thereafter assume
and take responsibility and liability for the following: (i) any and all
Liabilities attributable to the Property to the extent that such Liabilities
arise with respect to events occurring on or after the Closing Date, including,
without limitation (A) under the Bookings, Contracts, the New Franchise
Agreement, the Key Money Repayment Obligation, the New Management Agreement and
Ground Lease Documents, and (B) any Employee Liabilities and Employee Services
Liabilities other than any Employee Liabilities or Employee Services Liabilities
that accrued during the period of Seller’s ownership of the Property except if
Buyer receives a credit for any such Employee Liabilities or Employee Service
Liabilities; (ii) any and all Liabilities for third party tort claims arising
out of events that occur on or after the Closing Date; (iii) any and all
Liabilities with respect to the structural, physical or environmental condition
of the Property, whether such Liabilities are latent or patent, including all
Environmental Liabilities and violations of any Law and any and all judgments,
fines, penalties and other costs and liabilities related thereto (excluding
Liabilities for third party tort claims that occur prior to the Closing during
Seller’s ownership of the Property; provided that this exclusion shall not limit
the scope of the release of Seller and the Seller Release Parties as set forth
in Section 4.4(b)); (iv) any and all Liabilities related to the Repair Work; and
(v) any and all Liabilities with respect to which Buyer receives a credit at
Closing, including any Employee Liabilities or Employee Service Liabilities
(collectively, the “Assumed Liabilities”). Buyer acknowledges and agrees that
the Liabilities to be assumed by Buyer pursuant to each of the foregoing clauses
are intended to be independent of one another, so Buyer shall assume Liabilities
described in each of the clauses even though some of those Liabilities may be
read to be excluded by another clause. Buyer hereby agrees to indemnify, defend
and hold harmless Seller and the Seller Indemnified Parties from and against any
and all of the Assumed Liabilities. Seller shall continue to have responsibility
and liability for the Retained Liabilities and agrees to indemnify, defend and
hold harmless Buyer from and against any and all of the Retained Liabilities;
provided that the liability of Seller pursuant to the foregoing indemnity shall
not be subject to the Survival Period or the Cap Amount. The provisions of this
Section 4.4(c) shall survive the Closing (and not be merged into the Ground
Lease Assignment Agreement).

(d)    Successors and Assigns. The provisions of this Section 4.4 shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns and shall survive the Closing (and
not be merged into the Ground Lease Assignment Agreement).

 

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(e)    Reaffirmation and Survival. The provisions of this Section 4.4 shall be
deemed reaffirmed by Buyer and Sections 4.4(c) and 4.4(d) shall be deemed
reaffirmed by Seller delivery and acceptance of the Ground Lease Assignment
Agreement and shall survive the Closing (and not be merged into the Ground Lease
Assignment Agreement) or earlier termination of this Agreement.

SECTION 4.5.    Limitation on Seller’s Liability.

(a)    Maximum Aggregate Liability. Notwithstanding any provision to the
contrary contained in this Agreement or the Closing Documents, (i) the maximum
aggregate liability of the Seller, and the maximum aggregate amount that may be
awarded to and collected at any time by Buyer, in connection with the
Transaction, the Property and any Liabilities attributable to Seller or the
Property, under this Agreement, under any Closing Documents or otherwise in
connection with the Property, including in connection with the breach of any
covenant of Seller contained in this Agreement or any Closing Document (other
than any such covenant that has been waived by Buyer, for which Seller shall
have no further liability to Buyer) or of any of Seller’s Warranties shall not
exceed Eight Hundred Five Thousand Dollars ($805,000.00) (the “Cap Amount”);
provided, however, that notwithstanding the foregoing, the Retained Liabilities
and Seller’s re-proration obligations under Section 5.1 below shall not be
subject to or limited by the Cap Amount and such liabilities shall not be
applied to reduce the amount of the Cap Amount; and (ii) no claim by Buyer may
be made, and Seller shall not be liable for any judgment in any action based
upon any claim, in connection with the Transaction, the Property and any
Liabilities attributable to Seller or the Property, under this Agreement, and
under all Closing Documents including in connection with the breach of any
covenant of Seller contained in this Agreement or any Closing Document (other
than any such covenant that has been waived by Buyer, for which Seller shall
have no further liability to Buyer), unless and until such claim is for an
aggregate amount in excess of the Floor Amount; provided, however, that
notwithstanding the foregoing, Seller’s re-proration obligations under
Section 5.1 below shall not be subject to the Floor Amount. Notwithstanding
anything to the contrary contained in this Agreement, Buyer shall not have any
recourse to any member, partner, shareholder, stockholder, manager,
representative, affiliate, officer, director, beneficial owner, employee,
advisor or agent of Seller for any liabilities of Seller in connection with the
Transaction (including the Retained Liabilities), the Property and any
Liabilities attributable to the Property, under this Agreement, or under any
Closing Document or otherwise in connection with the Property or Transaction.

(b)    Escrow Holdback. At Closing, an amount equal to the Cap Amount shall be
held back from Seller’s proceeds from the sale of the Property and deposited
into a segregated interest-bearing account with Escrow Agent pursuant to the
terms and conditions of an escrow holdback agreement substantially in the form
attached hereto as Exhibit M (the “Escrow Holdback Agreement”).

(c)    Survival. The provisions of this Section 4.5 shall survive Closing (and
not be merged into the Ground Lease Assignment Agreement) or any earlier
termination of this Agreement.

 

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ARTICLE 5

ADJUSTMENTS AND PRORATIONS

SECTION 5.1.    Prorations, Credits and Other Adjustments. At Closing, Buyer and
Seller shall prorate all items of income and expense that are customarily
prorated between a purchaser and seller for hotel properties comparable to the
Hotel, including the prorations and other adjustments provided below, and the
net amount consequently owing to Seller or Buyer, as applicable, shall be added
to or subtracted from the proceeds of the Purchase Price payable to Seller at
Closing. Seller and Buyer shall, or shall by mutual agreement designate a third
party accountant to, prepare a statement of prorations, credits and other
adjustments (the “Closing Statement”) in a mutually acceptable format, with the
understanding that any deviations from the requirements of this Section 5.1
shall be “trued-up” in the Post-Closing Statement pursuant to the terms of this
Agreement.

(a)    Proration of Taxes. All real estate ad valorem taxes, general assessments
and special assessments and all personal property ad valorem taxes assessed
against the Real Property (generically and collectively, “Taxes”), which are
payable in the 2016-2017 fiscal tax year (the “Closing Tax Year”) shall be
prorated between Buyer and Seller as of the Closing Date. Prior to Closing,
Seller shall have paid the first installment Taxes for the Closing Tax Year. At
Closing, Seller and Buyer will prorate the second installment Taxes for the
Closing Tax Year based upon the relative ownership by each party of the Property
during the period commencing January 1, 2017 and ending June 30, 2017. Seller
retains the right to commence, continue and settle any proceeding to contest any
Taxes for any taxable period that encompasses any period prior to the Closing
Tax Year, and shall be entitled to any refunds or abatements of Taxes awarded in
such proceedings. For the avoidance of doubt, all Taxes, even if payable by
Seller as “Rent” under the Ground Lease Documents, shall be known as “Taxes” and
treated as such for all purposes under this Agreement.

(b)    General Proration of Expenses. The following items of expense with
respect to any portion or aspect of the Hotel shall be prorated between Seller
and Buyer as of 12:01 a.m. on the Closing Date (the “Cut-Off Time”), such that
expenses attributable to the period prior to the Cut-Off Time shall be the
responsibility of Seller, and the expenses attributable to the period following
the Cut-Off Time shall be the responsibility of Buyer:

(i)    All charges and expenses under any Contracts.

(ii)    All utility charges (but excluding any utility deposits, the full amount
of which shall be credited to Seller as set forth in Section 5.1(l)).

(iii)    Rent and other amounts payable under the Ground Lease Documents to The
Regents.

(iv)    Prepaid expenses of the Property including the expense of all assignable
Licenses and Permits obtained in connection with the operation of the Hotel to
the extent assigned to the Buyer at Closing.

(v)    All other Hotel operating expenses, other than employment expenses (which
are covered by Section 5.1(c) below).

 

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(c)    Employment Expenses. Except as provided otherwise in this Agreement,
Seller shall be responsible for all wages and other compensation accrued by
Employees and all Employee Services Liabilities relating to the period prior to
the Cut-Off Time, and the Buyer shall be responsible for all wages and other
compensation accrued by Employees, and all Employee Services Liabilities payable
with respect to the period, on or after the Cut-Off Time; provided, however,
that Buyer shall receive a credit against the Purchase Price if it assumes the
liability for any Employee wages and compensation or Employee Services
Liabilities that have accrued but have not been paid as of the Cut-Off Time and
set forth in the Closing Statement approved by Buyer and Seller.

(d)    Hotel Revenues. Seller shall receive all revenues from the Hotel guest
rooms and facilities occupied on the evening immediately preceding the Closing
Date (including any such sales from telephone, facsimile and data
communications, in-room movie, laundry, and other service charges allocable to
such rooms with respect to the evening immediately preceding the Closing Date)
and determined as of the Cut-Off Time by the night audit conducted on the
evening of the day prior to the Closing Date (the “Cut-Off Revenue Time”), with
Buyer receiving all revenues received after the Cut-Off Revenue Time; provided
that all revenues from the Hotel guest rooms from the Closing Date attributable
to guests who were occupying rooms as of the Cut-Off Revenue Time shall be
divided equally between Buyer and Seller. At Closing, all revenues from the
Hotel guest rooms and facilities that are payable to third parties in respect of
revenue earned before the Cut-Off Revenue Time (including any sales taxes, room
taxes, occupancy taxes and other taxes charged to guests in such rooms) shall be
allocated to Seller, and Buyer shall be allocated all of such revenue received
after the Cut-Off Revenue Time. All revenues from restaurants, lounges, vending
machines and other service operations conducted at the Hotel shall be allocated
to either Seller or Buyer based on whether the same accrued before or after the
Cut-Off Revenue Time as described in the preceding sentence, and Seller shall
cause Hotel Manager or Seller’s designee to separately record sales occurring
before and after the Cut-Off Revenue Time in the Hotel.

(i)    Revenues from conferences, receptions, meetings, and other functions
occurring in any conference, banquet or meeting rooms in the Hotel, or in any
adjacent facilities owned or operated by Seller, including usage charges and
related taxes, food and beverage sales, valet parking charges, equipment
rentals, and telecommunications charges, shall be allocated between Seller and
Buyer, based on when the function therein commenced, with (A) one-day functions
commencing prior to the Cut-Off Time but ending prior to 5:00 a.m. on the
Closing Date being allocable to Seller, (B) functions commencing after the
Cut-Off Revenue Time being allocable to Buyer, and (C) multi-day functions
commencing prior to the Closing Date being allocated between Seller and Buyer
according to when the event commences and ends, with revenues attributable to
the period prior to the Closing Date allocable to Seller, and revenues
attributable to the period from and after the Closing Date allocable to Buyer.

(ii)    At Closing, Seller shall receive a credit for accounts receivable but
not actually collected by Seller or Hotel Manager prior to the Cut-Off Revenue
Time (“Accounts Receivable”) equal to 100% of Accounts Receivable that are not
more than 90 days past due as of the Closing Date, and following Closing, Buyer
shall have the exclusive right to collect the same. Seller shall not receive a
credit at Closing for Accounts Receivable more than 90 days past due but shall
have the right to receive them from Hotel Manager if collected by Hotel Manager.

 

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(iii)    Any operating revenues not otherwise provided for in this
Section 5.1(d) shall be prorated between Buyer and Seller as of the Cut-Off
Time.

(e)    Operating Account; Reserve; House Banks. At Closing, Seller shall receive
a credit for all cash on hand and in all “house banks” at the Hotel to the
extent the same remains at the Hotel or is transferred to Buyer at Closing. At
Closing, Seller shall take possession of all working capital, FF&E reserves, the
Replacement Reserve Fund and all other escrows, impounds, accounts and reserves
held by Seller’s existing mortgage lender, Hotel Manager or any other party.

(f)    Hotel Payables. At Closing, all outstanding accounts payable for the
Hotel shall be prorated as of the Cut-Off Revenue Time (“Hotel Payables”), and
Buyer shall receive a proration credit therefor and shall assume the obligation
to satisfy such Hotel Payables, including all obligations of Seller to pay for
any (i) Operating Equipment, Consumables, Inventory, Food and Beverage Inventory
or other items ordered by or for the benefit of Seller but that are not yet
received as of the Closing Date, and (ii) items or services listed on the
purchase order log prepared by Hotel Manager, which list shall be updated by
Hotel Manager or Seller’s designee immediately prior to Closing and delivered to
Buyer.

(g)    Credit for Certain Inventories. As of the date immediately prior to the
Closing Date, Seller and Buyer shall jointly conduct or cause Hotel Manager or
any joint designee of Buyer and Seller to conduct an inventory of (i) all
Inventory and (ii) all Food and Beverage Inventory, in each case, that are
unused and in unopened cases (or bottles or jars in the case of Food and
Beverage Inventory) and located at the Hotel (“Unopened Inventory”), and shall
deliver a written report covering such Unopened Inventory to Seller and Buyer.
The parties hereby agree that Seller shall receive a credit for all Unopened
Inventory at Closing in the amount of the actual cost paid by Seller for the
same. Seller shall not receive a credit at Closing for any other supplies,
inventories or personal property.

(h)    Credit for Reservation Deposits. Buyer shall receive a proration credit
equal to the aggregate amount of advance cash (including credit card charges
that have been paid by the applicable credit card company) deposits that shall
have been actually received by Seller prior to the Cut-Off Time on account of
Bookings for the use or occupancy of the Hotel after the Cut-Off Time.

(i)    Regarding Hotel Prorations Generally. Unless expressly provided herein
otherwise: (i) all prorations hereunder with respect to the Hotel shall be made
as of the Cut-Off Time, (ii) all prorations shall be made on an actual daily
basis, and (iii) for purposes of such prorations, all items of revenue and
expense with respect to the Hotel’s operations shall be classified and
determined in accordance with the Uniform System of Accounts and otherwise in
accordance with GAAP. Except as otherwise expressly provided herein, in any case
in which Buyer receives a credit at Closing on account of any obligation of
Seller hereunder, Seller shall have no further liability for such obligation to
the extent of the credit so given, and Buyer shall pay and discharge the same.

 

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(j)    Vouchers. Buyer shall (i) honor all outstanding unexpired gift
certificates, coupons or other writings issued by Seller, Franchisor or Hotel
Manager that entitles the holder or bearer thereof to a credit (whether in a
specified dollar amount or for a specified item, such as room night or meals) to
be applied against the usual charge for rooms, meals and/or goods and services
at the Hotel listed in Schedule 5.1(j) attached hereto and incorporated herein
by this reference, as updated as of the Closing Date (collectively, “Vouchers”);
and Buyer shall receive a credit to the Purchase Price in the agreed upon value
of such Vouchers as set forth on Schedule 5.1(j).

(k)    Intentionally deleted.

(l)    Utility Deposits. At Closing, Seller shall receive a credit for all
refundable cash or other deposits posted with utility companies serving the
Hotel or any governmental agencies or authorities or posted pursuant to any
operating agreement, or at Buyer’s option, Buyer shall post all required
deposits and Seller shall have the right to request refunds from the applicable
parties after Closing.

(m)    Post-Closing Statement; Post-Closing Adjustments. Except for
(i) prorations for real estate taxes and other assessments, which shall be
adjusted within fifteen (15) Business Days of receipt of the tax bill for the
tax year in which the Closing occurs, (ii) prorations of real estate tax refunds
and related expenses, which shall be adjusted as provided in Section 5.1(o),
(iii) prorations of sales taxes that are subject to an audit, which shall be
adjusted within fifteen (15) Business Days of completion of any such audit, and
(iv) prorations for Rent (as defined in the Ground Lease) under the Ground
Lease, which shall be adjusted as provided in the Ground Lease (the items
referred to in the foregoing clauses (i)-(iv), collectively, “Deferred
Adjustment Items”), Buyer and Seller shall make a one-time post-Closing
adjustment of any item of income and expense subject to adjustment as provided
above that was either incomplete or incorrect (whether as a result of an error
in calculation or a lack of complete and accurate information) as of the Closing
Date. The parties will prepare and approve a statement of prorations (the
“Post-Closing Statement”) within ninety (90) days following the Closing Date,
and the party in whose favor the original incorrect adjustment or error was made
(“Adjusting Party”) shall pay to the other party (“Requesting Party”) the sum
necessary to correct such prior incorrect adjustment or error within ten
(10) days after delivery of the Post-Closing Statement. Notwithstanding any
provision of this Agreement to the contrary, all items required to be adjusted
pursuant to this Section 5.1(m) shall be adjusted within ninety (90) days of
Closing (except for Deferred Adjustment Items, which shall be re-adjusted within
the period set forth above), and such adjustment shall be final and no further
adjustment to the prorations or the Purchase Price shall be made.

(n)    Resolution of Disputes. In the case of a dispute under this Section 5.1,
the parties shall attempt to resolve such dispute, but if for any reason such
dispute is not resolved by the date that is thirty (30) days after the delivery
of the original notice of the claimed adjustment by Buyer or Seller, but not to
exceed ninety (90) days after the Closing Date, then the parties shall submit
such dispute to a “big four” accounting firm designated by Seller (the “Outside
Accountants”), and the determination of the Outside Accountants, which shall be
made within a period of fifteen (15) days after such submittal by the parties,
shall be conclusive. The fees and expenses of the Outside Accountants shall be
shared equally by Buyer, on the one hand, and

 

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Seller on the other hand. At such time as the amount of any adjustment or
dispute shall be determined (either by agreement or by determination of the
Outside Accountants), any amount that shall be payable to the Requesting Party
by the Adjusting Party as a result of such adjustment or determination shall be
paid within ten (10) Business Days after the date on which such agreement or
determination shall have been made.

(o)    Seller Tax Appeal. Seller shall have the right to control the progress
of, and to make all decisions (including any decision to settle) with respect
to, any contest or appeal of the real estate taxes and personal property taxes
for the Property for tax years prior to the fiscal tax year in which Closing
occurs (“Prior Tax Years”) and Buyer shall have the right to control the
progress of, and to make all decisions (including any decision to settle), with
respect to, any contest or appeal of the real estate Taxes and personal property
Taxes for the Property for the Closing Tax Year; provided that Buyer shall keep
Seller reasonably informed regarding the status of any such contest or appeal
with respect to the taxes attributable to the Closing Tax Year. The parties
shall cooperate with each other in connection with any such contest or appeal.
To the extent any real estate or personal property tax refunds or credits are
received after Closing with respect to the Property and such refunds or credits
are attributable to real estate or personal property taxes paid for any Prior
Tax Year, or for any periods of the Closing Tax Year prior to the Closing Date,
Seller shall be entitled to the entirety of such refunds and credits (except to
the extent due to any other party under the Ground Lease Documents). To the
extent any such refunds or credits are attributable to real estate or personal
property taxes paid for the Closing Tax Year, such amounts shall be distributed
as follows (subject, however, to any conflicting provisions of the Ground Lease
Documents): first, to reimburse Seller and Buyer for all costs incurred in
connection with the contest; second, with respect to refunds payable pursuant to
the Ground Lease Documents to any parties thereto, to such parties in accordance
with the terms of such Ground Lease Documents; third, to Seller to the extent
such appeal covers the period prior to the Closing Date; and fourth, to Buyer to
the extent such appeal covers the period from and after the Closing Date.

(p)    Survival. The provisions of this Section 5.1 shall survive the Closing
(and not be merged into the Ground Lease Assignment Agreement) until both
parties agree, in writing, that all obligations of the parties hereunder have
been satisfied and fully complied with and shall not be deemed merged into any
instrument of conveyance delivered at the Closing.

SECTION 5.2.    Safe Deposit Boxes. To the extent applicable, on the Closing
Date, Seller shall cause Hotel Manager to make available to Buyer at the Hotel
all receipts and agreements in Hotel Manager’s possession or control relating to
all safe deposit boxes in use at the Hotel, other than safes or lockboxes, if
any, located inside individual guest rooms in the Hotel. From and after the
Closing, Seller shall be relieved of any and all responsibility in connection
with each said box, and Buyer shall indemnify and defend the Seller and the
Seller Indemnified Parties and hold them harmless from and against any claim,
liability, out-of-pocket cost or expense (including reasonable attorneys’ fees)
incurred by them, to the extent relating to items in such safety deposit boxes
as of the Closing Date. Seller shall indemnify, defend and hold harmless Buyer
and its affiliates from any other liability, claim, out-of-pocket cost or
expense (including reasonable attorneys’ fees) to the extent relating to any
such safety deposit box arising or attributable to the period prior to the
Closing Date. If Seller or Buyer should elect, as part of the Closing, they
shall jointly, with each holder of any such safety deposit boxes,

 

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inventory the contents of such safety deposit boxes and seek to have the holder
thereof confirm to Seller and Buyer, in writing, its contents as of the Closing.
The provisions of this Section 5.2 shall survive the Closing (and not be merged
into the Ground Lease Assignment Agreement).

SECTION 5.3.    Inventory of Baggage. The representatives of Seller and/or Hotel
Manager, and of Buyer shall prepare an inventory of baggage at the Hotel as of
9:00 a.m. on the Closing Date (which inventory of baggage shall be binding on
all parties thereto) of (i) all luggage, valises and trunks checked or left in
the care of the Hotel by guests then or formerly in the Hotel, (ii) parcels,
laundry, valet packages and other property of guests checked or left in the care
of the Hotel by guests then or formerly in the Hotel (excluding, however,
property in Hotel safe deposit boxes), and (iii) all items contained in the
Hotel “lost and found”. Buyer shall be responsible from and after the Closing
Date for all baggage and other items listed in such inventory of baggage, and
Buyer shall indemnify, defend and hold Seller and the Seller Indemnified Parties
harmless from and against any claim, liability, out-of-pocket cost or expense
(including reasonable attorneys’ fees) actually incurred by Seller or any Seller
Party to the extent relating to items listed in such inventory. Seller shall
indemnify, defend and hold harmless Buyer and its affiliates from any other any
claim, liability, out-of-pocket cost or expense (including reasonable attorneys’
fees) to the extent relating to guest baggage, packages and other property of
guests checked or left in the care of the Hotel by guests then or formerly in
the Hotel arising or attributable to the period prior to the Closing Date and
not noted on the inventory provided in this Section 5.3. The provisions of this
Section 5.3 shall survive the Closing (and not be merged into the Ground Lease
Assignment Agreement).

SECTION 5.4.    Closing Costs. Buyer shall pay: (i) the fees and expenses of any
counsel representing Buyer in connection with the Transaction; (ii) the premium
for the Owner’s Title Policy (including any endorsements and affirmative
insurance requested by Buyer); (iii) the cost of obtaining the Survey; (iv) all
recording and filing fees; (v) one-half (1/2) of any escrow fees charged by the
Escrow Agent and/or Title Company in connection with the Closing; (vi) all costs
incurred in connection with Buyer’s application to Franchisor to obtain
Franchisor’s consent to a new franchise agreement between Buyer and Franchisor
permitting the operating of the Hotel as a Hyatt Place after the Closing (the
“New Franchise Agreement”), including without limitation any inspection fees in
connection with a property improvement plan agreed to by Franchisor and Buyer in
connection with the New Franchise Agreement; and (vii) and all amounts incurred
by the Buyer in connection with any transfer of the Liquor License and Alcoholic
Beverages hereunder, including application fees. Seller shall pay: (a) the fees
and expenses of any counsel representing Seller in connection with the
Transaction; (b) one-half (1/2) of any escrow fees charged by the Escrow Agent
and/or Title Company in connection with the Closing; (c) the University’s
Reimbursed Transaction Expenses; (d) any transfer tax that becomes payable by
reason of the assignment or transfer of any of the Ground Lease Documents or the
recordation of the Ground Lease Assignment Agreement; and (e) any sales or use
taxes on the portion of the Purchase Price allocated to the FF&E provided that
Buyer and Hotel Manager shall not take any action inconsistent with reporting
the sale as qualifying for the occasional sales tax exemption. Any other costs
and expenses of Closing that are not addressed in this Agreement shall be
allocated between Seller and Buyer in accordance with the customary practice in
Yolo County, California. The provisions of this Section 5.4 shall survive the
Closing or any termination of this Agreement.

 

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ARTICLE 6

CLOSING

SECTION 6.1.    Closing Mechanics.

(a)    The parties shall conduct a New York style escrow closing through the
Escrow Agent so that it will not be necessary for any party to attend Closing.

(b)    Intentionally Omitted.

(c)    Intentionally Omitted.

SECTION 6.2.    Seller’s Closing Deliveries. At Closing, Seller shall deliver
the following:

(a)    Assignment and Assumption of Ground Lease. Three (3) original
counterparts of an assignment and assumption of the Ground Lease in
substantially the form of Exhibit D attached hereto (the “Ground Lease
Assignment Agreement”), executed and acknowledged by Seller.

(b)    Landlord Consent. Three (3) duly executed counterpart originals of the
Consent to Assignment and Assumption and Amendment to Ground Lease Documents in
substantially the form of Exhibit K attached hereto (the “Landlord Consent”),
executed by Seller and The Regents.

(c)    Landlord Estoppel Certificate. One (1) original of an estoppel
certificate dated not more than thirty (30) days prior to the Scheduled Closing
Date, in substantially the form of Exhibit L attached hereto (the “Landlord
Estoppel Certificate”).

(d)    Bill of Sale. One (1) original of a bill of sale in the form of Exhibit E
attached hereto, executed by Seller.

(e)    Omnibus Assignment and Assumption Agreement. Two (2) original
counterparts of an assignment and assumption agreement in the form of Exhibit F
attached hereto (the “Omnibus Assignment and Assumption Agreement”), executed by
Seller.

(f)    Non-Foreign Person Certificate. One (1) original of a non-foreign person
certificate in the form of Exhibit G attached hereto, as required by
Section 1445 of the Internal Revenue Code, executed by 173ODRE9 Holdings, LLC, a
Delaware limited liability company, the sole member of Seller.

(g)    Evidence of Authority. Documentation to establish to the Title Company’s
reasonable satisfaction the due authorization of Seller’s consummation of the
Transaction, including Seller’s execution of this Agreement and the Closing
Documents required to be delivered by Seller.

(h)    Other Documents. One (1) original of an owner’s affidavit in the form of
Exhibit I attached hereto and such other documents as are legally required to
record the Ground Lease Assignment Agreement, as may be reasonably required by
the Title Company to consummate the Transaction or as may be agreed upon by
Seller and Buyer to consummate the Transaction.

 

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(i)    Other Transfer Documents. A California 593-C withholding tax certificate,
executed by Seller.

(j)    Closing Statement. The Closing Statement, setting forth the prorations,
Closing costs and other adjustments to the Purchase Price to be made pursuant to
this Agreement, in a form mutually acceptable to Seller and Buyer, executed by
Seller.

(k)    Keys and Original Documents. Keys to all locks at the Hotel in Seller’s
possession and originals or, if originals are not available, copies, of all of
the Submission Matters, in each case to the extent not previously delivered to
Buyer.

(l)    Intentionally Omitted.

(m)    Escrow Holdback Agreement. Three (3) original counterparts of the Escrow
Holdback Agreement, executed by Seller.

(n)    Assignment of Key Money Guaranty. Two (2) original counterparts of an
assignment of Key Money Guaranty substantially in the form of Exhibit N attached
hereto (the “Key Money Guaranty Assignment”), executed by Seller.

SECTION 6.3.    Buyer’s Closing Deliveries. At Closing, Buyer shall deliver the
following:

(a)    Purchase Price. The Purchase Price, as adjusted for apportionments and
other adjustments required under this Agreement, plus any other amounts required
to be paid by Buyer at Closing.

(b)    Assignment and Assumption of Ground Lease. Three (3) original
counterparts of the Ground Lease Assignment Agreement, executed and acknowledged
by Buyer.

(c)    Landlord Consent. Three (3) duly executed counterpart originals of the
Landlord Consent, executed by Buyer.

(d)    Omnibus Assignment and Assumption Agreement. Two (2) original
counterparts of the Omnibus Assignment and Assumption Agreement, executed by
Buyer or its affiliate.

(e)    Evidence of Funding of Replacement Reserve Fund. Evidence that Buyer has
established and funded, or will fund at Closing by wiring such funds to Escrow
Agent, the Replacement Reserve Fund in accordance with Section 4.3 of the Ground
Lease or in a manner otherwise agreed to by The Regents.

(f)    Change of Ownership Report. A duly executed Preliminary Change of
Ownership Report.

 

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(g)    Evidence of Authority. Documentation to establish to the Title Company’s
reasonable satisfaction the due authorization of Buyer’s consummation of the
Transaction, including Buyer’s execution of this Agreement and the Closing
Documents required to be delivered by Buyer.

(h)    Other Documents. Such other documents as may be reasonably required by
the Title Company or as may be agreed upon by Seller and Buyer to consummate the
Transaction.

(i)    Closing Statement. The Closing Statement, setting forth the prorations,
Closing costs and other adjustments to the Purchase Price to be made pursuant to
this Agreement, in a form mutually acceptable to Seller and Buyer, executed by
Buyer.

(j)    Intentionally Omitted.

(k)    Escrow Holdback Agreement. Three (3) original counterparts of the Escrow
Holdback Agreement, executed by Buyer.

(l)    Assignment of Key Money Guaranty. Two (2) original counterparts of the
Key Money Guaranty Assignment, executed by Buyer or its affiliate.

SECTION 6.4.    Conditions to Buyer’s Obligations. Buyer’s obligation to close
the Transaction is conditioned on the satisfaction or waiver of all of the
following on or prior to the Scheduled Closing Date:

(a)    Representations True. All Seller’s Warranties shall be true and correct
in all material respects (subject to modification or waiver as set forth in
Section 7.3) on and as of the Scheduled Closing Date, as if made on and as of
such date, except to the extent that they expressly relate to an earlier date.

(b)    Title Conditions Satisfied. The Title Company shall be irrevocably
committed to issue the Owner’s Title Policy to Buyer.

(c)    Seller’s Deliveries Complete. Seller shall have delivered all of the
documents and other items required pursuant to Section 6.2 and shall have
performed all other material obligations to be performed by Seller hereunder as
of the Closing Date.

(d)    Landlord Consent, Landlord Estoppel Certificate, ROFO Waiver and ROFR
Waiver. The Regents shall have executed and delivered the Landlord Consent,
Landlord Estoppel Certificate, ROFO Waiver and ROFR Waiver.

(e)    Franchise Agreement. Franchisor shall have approved Buyer as a franchisee
and executed and delivered the New Franchise Agreement.

(f)    New Management Agreement. Buyer and Hotel Manager shall have executed the
New Management Agreement.

 

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SECTION 6.5.    Conditions to Seller’s Obligations. Seller’s obligation to close
the Transaction is conditioned on the satisfaction or waiver of all of the
following on or prior to the Scheduled Closing Date:

(a)    Representations True. All representations and warranties made by Buyer in
this Agreement shall be true and correct in all material respects on and as of
the Scheduled Closing Date, as if made on and as of such date, except to the
extent that they expressly relate to an earlier date.

(b)    Buyer’s Deliveries Complete. Buyer shall have timely delivered the funds
required under this Agreement and all of the documents to be executed by Buyer
set forth in Section 6.3, Section 8.5 and Section 8.8 and shall have performed
all other material obligations to be performed by Buyer at or prior to Closing.

(c)    Landlord Consent, Landlord Estoppel Certificate, ROFO Waiver and ROFR
Waiver. The Regents shall have executed and delivered the Landlord Consent,
Landlord Estoppel Certificate, ROFO Waiver and ROFR Waiver.

(d)    Termination of Franchise Agreement. Franchisor shall have executed the
New Franchise Agreement and executed a termination agreement for the Franchise
Agreement in Franchisor’s then standard form subject to reasonable changes
requested by Seller, including a release of Seller from any Key Money Repayment
Obligation.

(e)    New Management Agreement. Buyer and Hotel Manager shall have executed the
New Management Agreement which shall require Hotel Manager to continue to be the
counterparty with the Regents to the Employee Services Agreement and shall
require Liquor Licensee to continue to maintain the Liquor License.

SECTION 6.6.    Waiver of Failure of Conditions Precedent. At any time on or
before the Scheduled Closing Date, Seller or Buyer may elect in writing to waive
the benefit of any condition to its obligations hereunder. By closing the
Transaction, Seller and Buyer shall be conclusively deemed to have waived the
benefit of any remaining unsatisfied conditions set forth in this Article 6.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES

SECTION 7.1.    Buyer’s Representations. Buyer represents and warrants to Seller
as follows:

(a)    Buyer’s Authorization; Non-Contravention. Buyer (i) is duly organized (or
formed), validly existing and in good standing under the Laws of its State of
organization and, to the extent required by applicable Laws, authorized to do
business in the State in which the Property is located, and (ii) is authorized
to execute this Agreement and consummate the Transaction and fulfill all of its
obligations hereunder and under all Closing Documents to be executed by Buyer
and such instruments, obligations and actions are valid and legally binding upon
Buyer, enforceable in accordance with their respective terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws

 

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affecting the enforcement of creditors’ rights generally, and by general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law). The execution and delivery of this Agreement
and all Closing Documents to be executed by Buyer and the performance of the
obligations of Buyer hereunder or thereunder will not (w) result in the
violation of any Law or any provision of Buyer’s organizational documents,
(x) conflict with any order of any court or governmental instrumentality binding
upon Buyer, (y) conflict or be inconsistent with, or result in any default
under, any contract, agreement or commitment to which Buyer is bound, or
(z) require the approval, consent or action of, waiver or filing with, or notice
to, any third party, including but not limited to, any governmental bodies,
agencies or instrumentalities, except as have been obtained.

(b)    Buyer’s Financial Condition. No petition has been filed by or against
Buyer under the Federal Bankruptcy Code or any similar Laws. Buyer has adequate
capital to perform all of its obligations under this Agreement and the Closing
Documents.

(c)    OFAC; Patriot Act. None of Buyer, nor, to Buyer’s knowledge, any person
or entity that owns a controlling interest in Buyer or any of their respective
affiliates, nor, to Buyer’s knowledge, any of their respective brokers or other
agents acting in any capacity in connection with the transactions contemplated
by this Agreement, is or will be (i) conducting any business or engaging in any
transaction or dealing with any person appearing on the U.S. Treasury
Department’s OFAC list of prohibited countries, territories, “specifically
designated nationals” or “blocked person” (each a “Prohibited Person”) (which
lists can be accessed at the following web address:
http://www.ustreas.gov/offices/enforcement/ofac/), including the making or
receiving of any contribution of funds, goods or services to or for the benefit
of any such Prohibited Person; (ii) engaging in certain dealings with countries
and organizations designated under Section 311 of the USA PATRIOT Act as
warranting special measures due to money laundering concerns; (iii) dealing in,
or otherwise engaging in any transaction relating to, any property or interests
in property blocked pursuant to Executive Order No. 13224 dated September 24,
2001, relating to “Blocking Property and Prohibiting Transactions With Persons
Who Commit, Threaten to Commit, or Support Terrorism”; (iv) a foreign shell bank
or any person that a financial institution would be prohibited from transacting
with under the USA PATRIOT Act; or (v) engaging in or conspiring to engage in
any transaction that evades or avoids, or has the purpose of evading or
avoiding, or attempting to violate, any of the prohibitions set forth in (A) any
U.S. anti-money laundering law, (B) the Foreign Corrupt Practices Act, (C) the
U.S. mail and wire fraud statutes, (D) the Travel Act, (E) any similar or
successor statutes or (F) any regulations promulgated under the foregoing
statutes.

(d)    No Financing Contingency. The Transaction is not subject to any financing
contingency and no financing for the Transaction shall be provided by Seller.
Buyer has or will have at the Closing sufficient cash or other sources of
immediately good funds to enable it to make payment of the Adjusted Purchase
Price and any other amounts to be paid by it hereunder.

(e)    Franchise Agreement. Buyer or its affiliates have the necessary business
experience, aptitude and financial resources to operate the Hotel and meet
Franchisor’s applicable standards for Hyatt Place Hotel franchisees. Buyer is
not a Brand Owner (as defined in the Franchise Agreement). None of Buyer’s
property or interests is subject to being blocked under, and Buyer is not in
violation of any of the Anti-Terrorism Laws (as defined in the Franchise
Agreement).

 

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(f)    Ground Lease. Buyer or its affiliates have owned and operated one (1) or
more hotels of comparable quality to the Hotel for a minimum of three (3) years
and Buyer is not involved in and does not have any pending litigation. Buyer’s
proposed financing, if any, complies with Section 11.5.2 of the Ground Lease.

(g)    ERISA. Buyer is not (i) an “employee benefit plan” as defined in
Section 3(3) of ERISA, that is subject to Section 406 of ERISA, (ii) a “plan” as
defined in and subject to Section 4975 of the Internal Revenue Code of 1986, as
amended (the “Internal Revenue Code”), or (iii) an entity deemed to hold “plan
assets” of any of the foregoing within the meaning of 29 C.F.R. Section 2510.3
101, as modified by Section 3(42) of ERISA.

(h)    Survival. Buyer’s representations and warranties in this Section 7.1
shall survive Closing and not be merged into the Ground Lease Assignment
Agreement.

SECTION 7.2.    Seller’s Representations. Seller represents and warrants to
Buyer, as of the Effective Date, as follows:

(a)    Seller’s Authorization; Non-Contravention. Seller (i) is duly organized
(or formed), validly existing and in good standing under the Laws of its State
of organization and, to the extent required by applicable Laws, the State in
which the Property is located, and (ii) is authorized to execute this Agreement
and consummate the Transaction and fulfill all of its obligations hereunder and
under all Closing Documents to be executed by Seller and such instruments,
obligations and actions are valid and legally binding upon Seller, enforceable
in accordance with their respective terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors’ rights generally, and by general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law). The execution and delivery of this Agreement
and all Closing Documents to be executed by Seller and the performance of the
obligations of Seller hereunder or thereunder will not (w) result in the
violation of any Law or any provision of Seller’s organizational documents,
(x) conflict with any order of any court or governmental instrumentality binding
upon Seller, (y) result in any default under, any contract, agreement or
commitment to which Seller is bound, or (z) require the approval, consent or
action of, waiver or filing with, or notice to, any third party, including but
not limited to, any governmental bodies, agencies or instrumentalities, other
than The Regents.

(b)    Seller’s Financial Condition. No petition has been filed by Seller, nor
has Seller received written notice of any petition filed against Seller under
the Federal Bankruptcy Code or any similar Laws.

(c)    OFAC; Patriot Act. None of Seller, nor, to Seller’s Knowledge, any person
or entity that owns a controlling interest in Seller, or any of their respective
affiliates, nor, to Seller’s Knowledge, any of their respective brokers or other
agents acting in any capacity in connection with the transactions contemplated
by this Agreement, is or will be (i) conducting any business or engaging in any
transaction or dealing with any Prohibited Person, including the

 

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making or receiving of any contribution of funds, goods or services to or for
the benefit of any such Prohibited Person; (ii) engaging in certain dealings
with countries and organizations designated under Section 311 of the USA PATRIOT
Act as warranting special measures due to money laundering concerns;
(iii) dealing in, or otherwise engaging in any transaction relating to, any
property or interests in property blocked pursuant to Executive Order No. 13224
dated September 24, 2001, relating to “Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism”;
(iv) a foreign shell bank or any person that a financial institution would be
prohibited from transacting with under the USA PATRIOT Act; or (v) engaging in
or conspiring to engage in any transaction that evades or avoids, or has the
purpose of evading or avoiding, or attempting to violate, any of the
prohibitions set forth in (A) any U.S. anti-money laundering law, (B) the
Foreign Corrupt Practices Act, (C) the U.S. mail and wire fraud statutes,
(D) the Travel Act, (E) any similar or successor statutes or (F) any regulations
promulgated under the foregoing statutes.

(d)    Litigation. Except as set forth on Schedule 7.2(d), Seller’s Designated
Representative has not received written notice of any current, pending or
threatened litigation or other proceeding against Seller or the Hotel (including
any condemnation proceedings), and to Seller’s Knowledge, no such litigation,
except as set forth on Schedule 7.2(d), would, in the reasonable judgment of
Seller, materially and adversely affect the ownership, use or operation of the
Hotel that is not covered by insurance.

(e)    Contracts. Except as set forth on Schedule 7.2(e), neither Seller nor, to
Seller’s Knowledge, Hotel Manager, is a party to any Contracts that will be
binding upon Buyer or the Property after the Closing. To Seller’s Knowledge, the
Submission Materials include true, correct and complete copies in all material
respects of the Owner Service Contracts or Manager Service Contracts listed on
Schedule 7.2(e). Seller’s Designated Representative has neither given nor
received written notice of any material default or breach under any Owner
Service Contract that has not been cured.

(f)    Compliance with Law. Except as set forth on Schedule 7.2(f), Seller’s
Designated Representative has not received written notice from any governmental
authority of any violation of any Law applicable to Seller or the Hotel,
including without limitation, any zoning, environmental, labor or employment
laws, that has not been corrected. Except as set forth on Schedule 7.2(f),
Seller’s Designated Representative has not received written notice of any third
party claim related to Environmental Liabilities with respect to the Property.

(g)    Personal Property. Seller owns the Personal Property, other than any
Leased Personal Property, and at Closing the Personal Property will be free and
clear of all liens and encumbrances and claims for Taxes, other than the
Permitted Exceptions. To Seller’s Knowledge, a true, correct and complete
schedule of the Leased Personal Property is attached hereto as Schedule 7.2(g).

(h)    Franchise Agreement. The Submission Matters contain a true, correct and
complete copy of the Franchise Agreement. Seller’s Designated Representative has
not given or received written notice of any material default or breach under the
Franchise Agreement that has not been cured.

 

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(i)    Ground Lease Documents. To Seller’s Knowledge, Seller has provided to
Buyer true, correct and complete copies of the Ground Lease Documents, which
have not been amended, modified, supplemented or assigned except as expressly
set forth herein. Seller has received no written notice of default under the
Ground Lease Documents from The Regents and, to Seller’s Knowledge, no default
thereunder currently exists. Seller has neither given nor received any written
notice of termination pertaining to the Ground Lease.

(j)    Financial Statements. Seller has provided to Buyer copies of the profit
and loss statements and operating statements with respect to the Hotel for the
year 2015 and 2016 year-to-date that were provided to Seller by Hotel Manager.

(k)    Union Contracts. Neither Seller nor, to Seller’s Knowledge, Hotel Manager
is a party to a collective bargaining agreement with respect to the Hotel, and
the Hotel is not subject to or bound by any such agreement except for the
Employee Services Agreement. The Hotel Manager and the Hotel is subject to and
bound by the Employee Services Agreement.

(l)    ERISA. Seller is not (i) an “employee benefit plan” as defined in
Section 3(3) of ERISA, that is subject to Section 406 of ERISA, (ii) a “plan” as
defined in and subject to Section 4975 of the Internal Revenue Code, or (iii) an
entity deemed to hold “plan asset” of any of the foregoing within the meaning of
29 C.F.R. Section 2510.3 101, as modified by Section 3(42) of ERISA.

(m)    Designated Representative. The Designated Representative are the persons
with the best actual knowledge of the matters described in the representations
and warranties contained in this Section 7.2.

(n)    Real Estate Assessments and Other Taxes. Seller’s Designated
Representative has not received any written notice of any proposed increase in
the assessed valuation of the Property that is currently pending. To Seller’s
Knowledge, there are no pending tax appeals or protests affecting the Property.
To Seller’s Knowledge other than amounts disclosed by tax bills, no special
assessments of any kind are or have been levied against the Property or are
contemplated. To Seller’s Knowledge, all Sales Taxes, excise, room occupancy or
other taxes imposed by any governmental authority with respect to the Property
(collectively, “Other Taxes”) required to be paid or collected by Seller in the
operation of the Property have been timely collected and/or paid to the
appropriate governmental authority.

(o)    Bookings. Other than the Bookings set forth on Schedule 7.02(o) and
Ground Lease or Regents, to Seller’s Knowledge, Seller has not entered into any
leases, licenses, concessions, or other occupancy agreements for the use,
possession or occupancy of any portion of any Property.

(p)    Employees. All of the Employees are employees of Hotel Manager and not of
Seller. Seller has no employees and no leased employees providing services to
the Hotel. To Seller’s Knowledge, the Employee Services Agreement is the only
agreement that Hotel Manager is a party to that provides for Leased Employees or
other Employees for providing services at the Hotel with employees that are
subject to a collective bargaining agreement. To Seller’s Knowledge, Hotel
Manager has not received written notice of its default under the Employee
Services Agreement. Seller’s Designated Representative has not been served with
any employee grievance or unfair labor practice charge or complaint at the
Hotel.

 

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(q)    Foreign Person. Seller is not a “foreign person” or a “foreign
corporation,” as those terms are defined in Section 1445 of the Internal Revenue
Code.

(r)    Licenses and Permits; Liquor License. To Seller’s Knowledge, all Licenses
and Permits, together with the Liquor License, used in the operation of the
Property are listed on Schedule 7.2(r). Seller’s Designated Representative has
not received any written notice from any governmental authority having
jurisdiction over the Property of any violation, suspension, revocation or
non-renewal of the Liquor License or any material Licenses and Permits that has
not been cured or dismissed.

SECTION 7.3.    General Provisions.

(a)    Seller’s Warranties Deemed Modified. If, on or prior to the Closing Date,
to Buyer’s Knowledge, any of Seller’s Warranties are inaccurate, untrue or
incorrect in any way, such Seller’s Warranties shall be deemed modified to
reflect Buyer’s Knowledge.

(b)    Breach of Warranties. Actual damages for any untruth, inaccuracy or
incorrectness of Seller’s Warranties shall only be recoverable for all purposes
under this Agreement if Buyer’s aggregate damages resulting from such untruth,
inaccuracy or incorrectness of Seller’s Warranties are reasonably estimated to
exceed Fifty Thousand Dollars ($50,000) (the “Floor Amount”).

(c)    Survival; Limitation on Seller’s Liability. Seller’s Warranties shall
survive Closing and not be merged into the Ground Lease Assignment Agreement for
a period of one hundred twenty (120) days following Closing (such one hundred
twenty (120) day period, the “Survival Period”), and Seller shall only be liable
to Buyer hereunder for a material untruth, inaccuracy or incorrectness of a
Seller’s Warranty with respect to which (i) Seller receives a written notice of
a claim from Buyer on or before the expiration of the Survival Period, and
(ii) Buyer has commenced an action in a court of competent jurisdiction on or
before the date that is thirty (30) days following the expiration of the
Survival Period. For the avoidance of doubt, Seller’s liability for Seller’s
Warranties is subject to the terms of Section 4.5. Notwithstanding anything in
this Agreement to the contrary, however, if Closing occurs, Buyer hereby
expressly waives, relinquishes and releases any rights or remedies available to
it at law, in equity, under this Agreement or otherwise, including any claim
against Seller for damages that Buyer may incur, as the result of any of
Seller’s Warranties being untrue, inaccurate or incorrect if (A) at the time of
Closing, to Buyer’s Knowledge, such Seller’s Warranties were inaccurate, untrue
or incorrect in any way, and such Seller’s Warranties shall be deemed modified
or qualified to reflect such knowledge, or (B) Buyer’s aggregate damages
resulting from such untruth, inaccuracy or incorrectness are reasonably
estimated to be less than the Floor Amount.

(d)    Survival. The provisions of this Section 7.3 shall survive Closing (and
not be merged into the Ground Lease Assignment Agreement) or any earlier
termination of this Agreement.

 

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ARTICLE 8

COVENANTS

SECTION 8.1.    Intentionally Omitted.

SECTION 8.2.    Brokers. Seller and Buyer expressly acknowledge and represent
and warrant as of the Effective Date that other than Seller’s Broker, no party
has acted as the broker with respect to the Transaction and with respect to this
Agreement. Seller agrees to hold Buyer harmless and indemnify Buyer from and
against any and all Liabilities (including reasonable attorneys’ fees, expenses
and disbursements) suffered or incurred by Buyer as a result of any claims by
any party claiming to have represented Seller as broker in connection with the
Transaction. Seller shall pay any brokerage commission due to Seller’s Broker in
accordance with the separate agreement between Seller and Seller’s Broker. Buyer
agrees to hold Seller harmless and indemnify Seller and the Seller Indemnified
Parties from and against any and all Liabilities (including reasonable
attorneys’ fees, expenses and disbursements) suffered or incurred by Seller as a
result of any claims by any other party (other than Seller’s Broker) claiming to
have represented Buyer as broker in connection with the Transaction. The
provisions of this Section 8.2 shall survive Closing (and not be merged into the
Ground Lease Assignment Agreement) or the earlier termination of this Agreement.

SECTION 8.3.    Publicity. Seller and Buyer each hereby covenant and agree that,
except as expressly permitted by Section 8.4, neither Seller nor Buyer (nor any
affiliate thereof) shall issue any press release or similar public statement
with respect to the Transaction or this Agreement without the prior consent of
the other, which consent may be granted or withheld in such party’s sole
discretion. The provisions of this Section 8.3 shall survive Closing (and not be
merged into the Ground Lease Assignment Agreement) or the earlier termination of
this Agreement.

SECTION 8.4.    Confidentiality.

(a)    Buyer agrees to keep confidential and not disclose to any other person
without the prior written consent of Seller (i) the existence and the terms of
this Agreement, (ii) all information received, obtained or generated with
respect to the Property, the Seller Parties and the Transaction and (iii) the
identity of any direct or indirect owner of any beneficial interest in Seller.
Notwithstanding the foregoing, Buyer may disclose such information (A) to its
affiliates, shareholders, officers, managers, employees, consultants, financial
advisors, existing and potential investors or other capital sources, lenders,
potential lenders and agents and members of professional firms serving it or
potential lenders or investors who need to know such information for purposes of
evaluating the Transaction, so long as any such parties are advised of this
confidentiality requirement in accordance with the terms of this Section 8.4 and
that certain Principal Confidentiality Agreement dated as of September 2016 by
BSHH II LLC, an affiliate of Buyer (the “Confidentiality Agreement”), (B) as may
be required to comply with applicable Laws or a court order, including without
limitation, securities Laws and related disclosure requirements applicable to
Buyer and its affiliates, provided, however that if any such public announcement
or disclosure is required, Buyer shall provide Seller with a copy of such public
announcement or disclosure and a reasonable opportunity to review before such
public announcement or disclosure is made, (C) to the extent that such
information is a matter of public

 

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record or is or becomes generally available to the public, other than as a
result of a breach of Buyer’s obligations under this Section 8.4, or (D) to the
extent such information is independently developed by Buyer. Buyer hereby agrees
to indemnify, defend, and hold each of the Seller Indemnified Parties free and
harmless from and against any and all Liabilities (including reasonable
attorneys’ fees, expenses and disbursements) actually incurred by the Seller
Indemnified Parties arising out of or resulting from the breach of the terms of
this Section 8.4 or the Confidentiality Agreement.

(b)    The provisions of this Section 8.4 shall survive Closing (and not be
merged into the Ground Lease Assignment Agreement) or earlier termination of
this Agreement.

SECTION 8.5.    Intentionally Omitted.

SECTION 8.6.    Employees.

(a)    Buyer shall, or shall cause Hotel Manager to, retain effective at and
upon Closing, all of the Employees so that Seller and Hotel Manager shall not be
required to give any layoff, closing or other termination notices or otherwise
incur any liability pursuant to the provisions of the WARN Act or any other
similar Laws or policies, including any liability for accrued vacation, paid
time off or severance. Buyer shall not terminate or cause or permit Hotel
Manager to terminate any Employees for at least ninety (90) days after the
Closing Date if any such termination would reasonably be expected to result in
liability to Seller or Hotel Manager pursuant to the provisions of the WARN Act,
ERISA or any other similar Laws. At Closing, Buyer shall enter into the New
Management Agreement with Hotel Manager and Hotel Manager shall continue to be
the counterparty to the Employee Services Agreement and its affiliate shall
continue to be the Liquor Licensee.

(b)    From and after the Closing, Buyer shall be solely responsible for
complying or causing compliance with (i) all applicable Laws relating to
Employees, including Buyer’s covenants set forth in this Section 8.6, including
compliance with any applicable provisions of the WARN Act and ERISA and (ii) all
terms and conditions of the Employee Services Agreement. Except to the extent
prorated among the parties hereto in accordance with Article 5, Buyer shall
indemnify, defend and hold Seller and the Seller Indemnified Parties harmless
from and against any and all claims, liabilities, actual out-of-pocket costs and
expenses (including reasonable attorneys’ fees and costs) actually incurred by
Seller or the Seller Indemnified Parties and arising in connection with (i) any
Employee Liabilities or Employee Services Liabilities arising out of events
occurring on or after the Closing Date (including, without limitation, any WARN
Act claim brought by or on behalf of any Employee or Leased Employees and any
liability for accrued vacation, paid time off, severance and/or other wage or
benefit payments), and (ii) any failure by Buyer to comply with the terms of
this Section 8.6.

(c)    Nothing contained in this Section 8.6 or otherwise in this Agreement
shall be deemed to (i) create a joint employer relationship between Buyer or
Seller or Hotel Manager or The Regents, (ii) serve as evidence of a joint
employer relationship or (iii) otherwise create or act as evidence of an
employer/employee relationship between Buyer or Seller and any Employees or
Leased Employees.

 

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(d)    During the period prior to Closing, the parties agree to reasonably
cooperate and to consult on a regular basis and coordinate their activities
relating to employee matters so as to facilitate a smooth transition of Property
operations and the continued proper performance by the Employees and the Leased
Employees of their respective duties up to Closing.

(e)    The provisions of this Section 8.6 shall survive the Closing (and not be
merged into the Ground Lease Assignment Agreement) or earlier termination of
this Agreement.

SECTION 8.7.    Termination of Hotel Management Agreement. (a) Seller shall
provide evidence to Buyer that Seller has terminated the Hotel Management
Agreement on the Closing Date, which evidence may include Hotel Manager entering
into the New Management Agreement.

(b)    For a period of one hundred twenty (120) days following the Closing Date,
upon reasonable prior notice to Buyer and Hotel Manager, between 9:00 a.m. and
5:00 p.m. on weekdays, Seller or any Seller Party shall be entitled to enter the
Property to perform Seller’s obligations under the Hotel Management Agreement
that expressly survive the termination thereof, including to verify the
performance by Hotel Manager of any of its obligations under the Hotel
Management Agreement that expressly survive the termination thereof; provided
that Seller’s or such Seller Party’s entry onto the Property shall not
unreasonably interfere with Buyer’s or Hotel Manager’s operation of the Hotel or
the use or enjoyment thereof by any hotel guest or other occupant thereof.

SECTION 8.8.    Books and Records. Buyer has advised Seller that Buyer (or any
direct or indirect owner of Buyer or affiliate thereof) may be required to file,
in compliance with certain laws and regulations (including, without limitation,
Regulation S-X of the Securities and Exchange Commission), audited financial
statements, pro forma financial statements and other financial information
related to the Property (the “Financial Information”). If requested by Buyer in
writing within ninety (90) days following the Closing, Seller agrees to use its
commercially reasonable efforts, at no cost or expense to Seller, to make
available to Buyer information regarding the Property that is in Seller’s actual
possession and that is reasonably necessary for Buyer and its representatives
and agents to prepare the Financial Information. Notwithstanding the foregoing,
Seller shall not be required to provide any information concerning (a) Seller’s
confidential financial analyses or projections, prepared solely for Seller’s
internal purposes and not directly related to the operation of the Property, or
(b) financial statements of any affiliate of Seller (other than Property-level
financial statements). The provisions of this Section 8.8 shall survive the
Closing and not be merged into the Ground Lease Assignment Agreement for a
period of ninety (90) days after the Closing but shall be subject to the Floor
Amount, Cap Amount and Survival Period.

SECTION 8.9.    Reporting and Audit Under Ground Lease. Seller agrees to
maintain all of its books, records and federal, state and local tax returns
relating to its ownership and/or operation of the Property for not less than
five (5) years after the expiration of each full or partial calendar year to
which such books, records and tax returns relate. Seller shall, upon request by
Buyer, furnish to Buyer true, complete and correct statements of all such books,
records and tax returns and shall make complete books, records and tax returns
available for inspection and audit by The Regents or its authorized
representatives upon forty-eight (48) hours’ prior notice at any

 

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time during normal business hours. Within twenty (20) days following the end of
the calendar month in which the Closing Date occurs, Seller, at its sole cost
and expense, shall cause to be prepared and provide to Buyer a statement setting
forth in reasonable detail the amount of Room Revenues (as defined in the Ground
Lease) accrued for the immediately preceding calendar month and year-to-date
period. In addition, Seller, at its sole cost and expense, shall cause to be
prepared and provide to Buyer not later than March 31, 2017 the Annual Statement
(as defined in the Ground Lease) for the calendar year 2016. In the event that
The Regents exercises its right to audit any Annual Statement relating to
calendar year 2016 or any prior year during Seller’s ownership of the Property,
Seller shall reasonably cooperate with Buyer to permit The Regents to complete
such audit and shall be responsible for the payment of any amounts due to The
Regents in connection with such audit of the Hotel, except to the extent that
such amounts relate to any period on or after Closing. Seller shall be entitled
to any overpayment of rent determined to have been made as a result of any such
audit that relates to any period prior to Closing. The provisions of this
Section 8.9 shall survive the Closing and shall not be merged into the Ground
Lease Assignment Agreement provided that Buyer shall not have the right to
recover any damages from Seller for Seller’s failure to comply with this
obligation and Buyer’s sole remedy shall be to seek declaratory relief.

SECTION 8.10.    Repair Work. Seller and Buyer have discussed water
infiltration, system leaks or other water related issues at the Property. At
Closing, Seller shall deposit with Escrow Agent a portion of the Purchase Price
equal to Two Hundred Forty Thousand and 00/100 Dollars ($240,000.00) (the “Water
Damage Escrow”) to be held and disbursed by Escrow Agent in accordance with the
terms hereof. Within thirty (30) days following Closing, Buyer and Seller shall
agree on the scope and cost of work to be performed. As part of such process,
Buyer shall obtain two (2) third party bids from licensed contractors for the
work to be performed which bids shall be presented to Seller for review. If
Buyer and Seller, acting reasonably, cannot agree within such thirty (30) day
period, Buyer shall select and engage one of US BCI, Wiss Janney Elstner or
Simpson Gumpertz & Heger (the “Consultant”) to determine the appropriate cost
and scope and the Consultant’s determination shall be binding. Thereafter, Buyer
shall correct the condition(s) resulting in water infiltration and repair any
damage related thereto as agreed by the parties or as determined by the
Consultant (“Repair Work”). Buyer shall be entitled to reimbursement from the
Water Damage Escrow of the reasonable, actual out-of-pocket expenses incurred by
Buyer in connection with the performance of the Repair Work. Upon submission to
Seller and the Escrow Agent of receipts, invoices or other reasonably detailed
documentation evidencing the reasonable, actual out-of-pocket expenses
(including Consultant fees, if any) incurred by Buyer to perform the Repair Work
(or any portion thereof), Escrow Agent shall disburse funds from the Water
Damage Escrow to or at the direction of Buyer in the amount set forth therein.
Upon the sooner of the completion of the Repair Work or one hundred fifty
(150) days following Closing, any remaining funds in the Water Damage Escrow
shall be released to Seller. Any escrow fees incurred in connection with the
Water Damage Escrow shall be shared equally by Buyer and Seller. Notwithstanding
anything to the contrary set forth in this Agreement, this Section 8.10 shall
survive the Closing for one hundred fifty (150) days, shall not be merged into
the Ground Lease Assignment Agreement and shall not be subject to the Floor
Amount, Cap Amount and Survival Period; provided, however, that Seller shall
have no liability related to the Repair Work in excess of the Water Damage
Escrow.

 

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ARTICLE 9

INTENTIONALLY OMITTED

ARTICLE 10

INTENTIONALLY OMITTED

ARTICLE 11

MISCELLANEOUS

SECTION 11.1.    Intentionally Omitted.

SECTION 11.2.    Survival/Merger. Except for the provisions of this Agreement
that are explicitly stated to survive the Closing, (a) none of the terms of this
Agreement shall survive the Closing, and (b) the delivery of the Purchase Price,
the Ground Lease Assignment Agreement and the other Closing Documents and the
acceptance thereof shall effect a merger, and be deemed the full performance and
discharge of every obligation on the part of Buyer and Seller to be performed
hereunder.

SECTION 11.3.    Integration; Waiver. This Agreement and the Confidentiality
Agreement embody and constitute the entire understanding between the parties
with respect to the Transaction and all prior agreements, understandings,
representations and statements, oral or written, are merged into this Agreement.
Neither this Agreement nor any provision hereof may be waived, modified,
amended, discharged or terminated except by an instrument signed by the party
against whom the enforcement of such waiver, modification, amendment, discharge
or termination is sought, and then only to the extent set forth in such
instrument. No waiver by either party hereto of any failure or refusal by the
other party to comply with its obligations hereunder shall be deemed a waiver of
any other or subsequent failure or refusal to so comply.

SECTION 11.4.    Governing Law. This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of New York,
without regard to the principles of conflicts of laws. The provisions of this
Section 11.4 shall survive the Closing (and not be merged into the Ground Lease
Assignment Agreement) or any earlier termination of this Agreement.

SECTION 11.5.    Captions Not Binding; Exhibits and Schedules. The captions in
this Agreement are inserted for reference only and in no way limit the scope or
intent of this Agreement or of any of the provisions hereof. All Exhibits and
Schedules attached hereto shall be incorporated by reference as if set out
herein in full.

SECTION 11.6.    Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.

SECTION 11.7.    Severability. If any term or provision of this Agreement or the
application thereof to any persons or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby, and each term
and provision of this Agreement shall be valid and enforced to the fullest
extent permitted by law. The provisions of this Section 11.7 shall survive the
Closing (and not be merged into the Ground Lease Assignment Agreement) or any
earlier termination of this Agreement.

 

38

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SECTION 11.8.    Notices. Any notices or other communications under this
Agreement shall be in writing and shall be given by (a) personal delivery,
(b) e-mail transmission (with a copy delivered by one of the other methods
provided in this Section 11.8) or (c) a reputable overnight courier service,
fees prepaid, addressed as follows:

IF TO BUYER:

c/o BRE Select Hotels

65 East 55th Street, 35th Floor

New York, NY 10022

Attn: Sam Gleeson

Telephone: (212) 520-7999

E-mail: sam.gleeson@breselect.com

with a copy to:

c/o Blackstone Real Estate Advisors

345 Park Avenue

32nd Floor

New York, New York 10154

Attention:    Bill Stein; Judy Turchin; Brian Kim

Telephone:  212.390.2232

Facsimile:   212.583.5202

Email: stein@blackstone.com, judy.turchin@blackstone.com, and

           brian.kim@blackstone.com

with a copy to:

if before February 20, 2017:

DLA Piper LLP (US)

203 North LaSalle St., Suite 1900

Chicago, IL 60601

Attn: Sandra Kellman, Esq.

Telephone: (312) 368-4082

E-mail: Sandra.kellman@dlapiper.com

 

39

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if after February 20, 2017:

DLA Piper LLP (US)

444 W. Lake Street

Chicago, IL 60606-0089

Attn: Sandra Kellman, Esq.

Telephone: (312) 368-4082

E-mail: Sandra.kellman@dlapiper.com

IF TO SELLER:

173ODRE9 GL Owner, LLC

7121 Fairway Drive, Suite 410

Palm Beach Gardens, FL 33418

Attention: General Counsel

Telephone: (561) 598-6700

Facsimile No.: (561) 422-4672

E-mail: notices@westbrookpartners.com

with a copy to:

173ODRE9 GL Owner, LLC

645 Madison Avenue, 18th Floor

New York, NY 10022

Attn: General Counsel and Matt Kenney

Telephone: (212) 849-8800

Facsimile No.: (212) 849-8801

E-mail: notices@westbrookpartners.com

mkenney@westbrookpartners.com

and a copy to:

Orrick, Herrington & Sutcliffe, LLP

777 S. Figueroa St. Suite 3200

Los Angeles, CA 90017

Attention: Gerard Walsh, Esq.

Telephone: (213) 612-2432

Facsimile No.: (213) 612-2499

E-mail: gwalsh@orrick.com

IF TO ESCROW AGENT:

Chicago Title Insurance Company

711 3rd Avenue, Suite 500

New York, NY 10017

Attention: Neal J. Miranda

Telephone #: 212-880-1237

Facsimile No.:

E-mail: neal.miranda@ctt.com

 

40

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Any party may designate another addressee for notices hereunder by a notice
given pursuant to this Section 11.8. A notice sent in compliance with the
provisions of this Section 11.8 shall be deemed given on the date of receipt
(and in the case of notice by e-mail transmission, by delivery by such means to
the addressee, regardless of the timing of receipt of any confirmation copy),
with failure to accept delivery to constitute receipt for such purpose. The
parties agree that the attorney for such party specified above shall have the
authority to deliver notices on such party’s behalf to the other party.

SECTION 11.9.    Counterparts; Electronic Signatures. This Agreement may be
executed in counterparts, each of which shall be an original and all of which
counterparts taken together shall constitute one and the same agreement.
Signatures to this Agreement transmitted by electronic means shall be valid and
effective to bind the party so signing. Each party agrees to promptly deliver an
execution original to this Agreement with its actual signature to the other
party, but a failure to do so shall not affect the enforceability of this
Agreement.

SECTION 11.10.    No Recordation. Seller and Buyer each agrees that neither this
Agreement nor any memorandum or notice hereof shall be recorded and Buyer agrees
(a) not to file any notice of pendency or other instrument against the Property
or any portion thereof in connection herewith, and (b) to indemnify Seller
against all Liabilities (including reasonable attorneys’ fees, expenses and
disbursements) incurred by Seller by reason of the filing by Buyer of any such
notice of pendency or other instrument.

SECTION 11.11.    Additional Agreements; Further Assurances. Each of the parties
hereto shall execute and deliver such documents as the other party shall
reasonably request in order to consummate and make effective the Transaction, so
long as the execution and delivery of such documents shall not result in any
additional Liability or cost to the executing party.

SECTION 11.12.    Construction. The parties acknowledge that each party and its
counsel have reviewed and revised this Agreement and that the normal rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement,
any modification hereof or any of the Closing Documents.

SECTION 11.13.    Attorneys’ Fees. In the event any litigation is instituted
between the parties arising out of or relating to this Agreement, the party in
whose favor judgment shall be entered in a final, non-appealable decision by a
court of competent jurisdiction shall be entitled to have and recover from the
non-prevailing party all costs and expenses (including attorneys’ fees and court
costs) incurred in such action and any appeal therefrom. The provisions of this
Section 11.13 shall survive the Closing (and not be merged into the Ground Lease
Assignment Agreement) or any earlier termination of this Agreement.

SECTION 11.14.    Time of Essence. Time is of the essence with respect to
Closing and all of the provisions of this Agreement.

SECTION 11.15.    Jurisdiction. WITH RESPECT TO ANY SUIT, ACTION OR PROCEEDINGS
RELATING TO THE TRANSACTION, THIS AGREEMENT, THE

 

41

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PROPERTY OR THE RELATIONSHIP OF BUYER AND SELLER HEREUNDER (“PROCEEDINGS”) EACH
PARTY IRREVOCABLY (a) SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE
COUNTY OF NEW YORK, STATE OF NEW YORK AND THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK, AND (b) WAIVES ANY OBJECTION THAT IT MAY HAVE
AT ANY TIME TO THE LAYING OF VENUE OF ANY PROCEEDINGS BROUGHT IN ANY SUCH COURT,
WAIVES ANY CLAIM THAT SUCH PROCEEDINGS HAVE BEEN BROUGHT IN AN INCONVENIENT
FORUM AND FURTHER WAIVES THE RIGHT TO OBJECT, WITH RESPECT TO SUCH PROCEEDINGS,
THAT SUCH COURT DOES NOT HAVE JURISDICTION OVER SUCH PARTY. THE PROVISIONS OF
THIS SECTION 11.15 SHALL SURVIVE THE CLOSING (AND NOT BE MERGED INTO THE GROUND
LEASE ASSIGNMENT AGREEMENT) OR ANY EARLIER TERMINATION OF THIS AGREEMENT.

SECTION 11.16.    Waiver of Jury Trial. EACH PARTY HEREBY WAIVES TRIAL BY JURY
IN ANY PROCEEDINGS BROUGHT BY THE OTHER PARTY IN CONNECTION WITH ANY MATTER
ARISING OUT OF OR IN ANY WAY CONNECTED WITH THE TRANSACTION, THIS AGREEMENT, THE
PROPERTY OR THE RELATIONSHIP OF BUYER AND SELLER HEREUNDER. THE PROVISIONS OF
THIS SECTION 11.16 SHALL SURVIVE THE CLOSING (AND NOT BE MERGED INTO THE GROUND
LEASE ASSIGNMENT AGREEMENT) OR ANY EARLIER TERMINATION OF THIS AGREEMENT.

SECTION 11.17.    Releases. WITH RESPECT TO ANY RELEASE SET FORTH IN THIS
AGREEMENT RELATING TO UNKNOWN AND UNSUSPECTED CLAIMS, THE PARTIES HERETO HEREBY
ACKNOWLEDGE THAT SUCH WAIVER AND RELEASE IS MADE WITH THE ADVICE OF COUNSEL AND
WITH FULL KNOWLEDGE AND UNDERSTANDING OF THE CONSEQUENCES AND EFFECTS OF SUCH
RELEASE.

SECTION 11.18.    Lead Paint. Buyer acknowledges that pursuant to regulation
promulgated by the U.S. Department of Housing and Urban Development (24 C.F.R.
Part 35) and the Environmental Protection Agency (40 C.F.R. Part 745), pursuant
to Section 1018 of the Residential Lead Paint Hazard Reduction Act of 1992,
Buyer has the right to make Buyer’s obligations under this Agreement contingent
on a ten-day period to perform a risk assessment or inspection on the property
for lead-based paint and/or lead-based paint hazards. Buyer hereby represents
that it has either (a) performed such risk assessment or inspection prior to the
execution of this Agreement or (b) waives its rights to do so and any attendant
rights of Buyer to cancel this Agreement for reasons related to the presence, if
any, of lead-based paint and/or lead-based paint hazards.

SECTION 11.19.    Bulk Sale; Tax Clearance Certificates.

(a)    Seller and Buyer acknowledge that they do not intend to comply with and
have agreed to waive the provisions of any statutory bulk sale requirements
applicable to the transaction to be effected by this Agreement, and in such
case, Seller and Buyer agree to rely upon the adjustment and indemnification
provisions of this Agreement to address any matters that would otherwise be
subject to such bulk sale requirements.

 

42

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(b)    Seller shall use commercially reasonable efforts to cooperate (at no
cost, expense or liability to Seller) with Buyer in connection with Buyer’s
application for the issuance of a Letter of Good Standing or other documentation
from the California State Board of Equalization with respect to the Hotel (a
“Tax Certificate”). “Sales Taxes” shall mean all sales and uses taxes, hotel
occupancy or accommodation taxes or the equivalent, resort taxes and similar
taxes, required to be paid or collected by Seller or Hotel Manager in the
operation of the Property as of the Effective Date, or otherwise imposed by any
governmental authority with respect to the Property, together with any interest
and penalties thereon. If any Tax Certificate received before Closing shows any
Sales Taxes which have accrued prior to the Closing Date during Seller’s
ownership of the Property and remain unpaid (the “Outstanding Sales Taxes”) as
of such date, the amount of such Outstanding Sales Taxes shall be paid by Seller
at Closing. If a Tax Certificate is not received prior to Closing, Seller shall
continue to remain liable for any Outstanding Sales Taxes accrued during
Seller’s ownership of the Property and upon issuance of any Tax Certificate
after Closing that shows any Outstanding Sales Taxes that accrued during
Seller’s ownership of the Property, Seller shall promptly pay the same. To the
extent permitted by law, the parties shall report the sale of the Personal
Property as exempt from taxation as an occasional sale under Section 6006.5 of
the California Revenue and Taxation Code. The provisions of this Section
11.19(b) and Section 11.19(a) above shall survive the Closing for sixty
(60) days and shall not be merged into the Ground Lease Assignment Agreement.

SECTION 11.20.    Natural Hazard Disclosures. As used herein, the term “Natural
Hazard Area” shall mean those areas identified as natural hazard areas or
natural hazards in the Natural Hazard Disclosure Act, California Government Code
Sections 8589.3, 8589.4 and 51183.5, and California Public Resources Code
Sections 2621.9, 2694 and 4136, and any successor statutes or laws (the
“Act”). Buyer shall request that the Title Company provide Seller and Buyer with
a Natural Hazard Disclosure Statement (the “Disclosure Statement”) in a form
required by the Act. Buyer acknowledges and agrees that the matters set forth in
the Disclosure Statement may change on or prior to the Closing and that Seller
has no obligation to update, modify or supplement the Disclosure Statement.

[REMAINDER OF PAGE INTENTIONALLY BLANK]

 

43

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IN WITNESS WHEREOF, each party hereto has caused this Agreement to be duly
executed to be effective as of the day and year first above written.

 

SELLER: 173ODRE9 GL OWNER, a Delaware limited liability company By:  

/s/ Diego Rivera

Name:   Diego Rivera Title:   Vice President

 

[Signature Page – Purchase and Sale Agreement]

[Hyatt UC Davis Hotel]

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

BUYER: BREIT DAVIS PROPERTY OWNER LLC, a Delaware limited liability company By:
 

/s/ Brian Kim

Name:   Brian Kim Title:   Managing Director and Vice President

 

[Signature Page – Purchase and Sale Agreement]

[Hyatt UC Davis Hotel]

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AGREEMENT OF ESCROW AGENT

The undersigned has executed this Agreement solely to confirm its agreement to
comply with the provisions of Exhibit C to this Agreement.

In witness whereof, the undersigned has executed this Agreement as of January
    , 2017.

 

CHICAGO TITLE INSURANCE COMPANY By:  

/s/ Jefferson Javier

Name:   Jefferson Javier Title:   Escrow Officer

 

[Signature Page – Purchase and Sale Agreement]

[Hyatt UC Davis Hotel]

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EXHIBIT A

LEGAL DESCRIPTION OF REAL PROPERTY

All that certain real property situated in the County of Yolo, State of
California, described as follows:

Unincorporated Area

Parcel One:

Being a portion of Section 15, Township 8 North, Range 2 East, Mount Diablo
Meridian, described as follows:

Commencing at the Southwest corner of that certain parcel of land conveyed to
the State of California by Deed recorded February 19, 1960 in Book 1015 of
Solano County Official Records, at Page 379 as Instrument No. 3306, said point
being on the Southeasterly right of way line of the Union Pacific Railroad and
also being the most Northerly corner of Parcel Three, as said Parcel is
described in that certain Quitclaim Deed from John Whitcombe, et al to John S.
and Mary Y. Nishi, recorded on March 18, 1998 as Document No. 98-0006962,
Official Records of Yolo County; thence North 14 degrees 29’ 53” East, 540.26
feet to the true point of beginning; thence North 55 degrees 10’ 36” West,
105.10 feet; thence North 26 degrees 56’ 50’ West, 203.04 feet; thence North 45
degrees 04’ 28” East, 21.28 feet; thence North 44 degrees 55’ 32” West, 41.99
feet to a point from which an iron bar with cap marked LS 5435 bears South 45
degrees 04’ 28” West, 324.64 feet; thence North 45 degrees 04’ 28” East, 289.27
feet to an iron bar with cap marked LS 5435; thence North 45 degrees 04’ 28”
East, 124.02 feet; thence 217.48 feet along a curve to the right, said curve
having a radius of 354.27 feet, a central angle of 35 degrees 10’ 22”, and being
subtended by a chord bearing South 16 degrees 58’ 14” East, 214.08 feet to a
point from which a 5/8” rebar with 1-1/2” aluminum cap marking University of
California at Davis Survey Control Point No. 533 bears North 81 degrees 52’ 24”
East, 259.11 feet; thence 251.67 feet along a curve to the right, said curve
having a radius of 383.00 feet, a central angle of 37 degrees 38’ 58”, and being
subtended by a chord bearing South 15 degrees 59’ 55” West, 247.17 feet; thence
South 34 degrees 49’ 24” West, 164.79 feet to the true point of beginning.

Parcel Two:

A non-exclusive easement on, over, across and through the Campus via campus
roads, pathways and sidewalks for all forms of pedestrian and vehicular ingress,
egress and access between the premises and the public streets and roadways
abutting the Campus as contained in and subject to the Lease dated August 18,
2008 as referenced in the Memorandum of Lease recorded October 21, 2008 as
Instrument No. 2008-0031841, Official Records.

APN: 036-170-023

 

A-1

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EXHIBIT B

UNION CONTRACTS

 

1. Agreement effective as of December 13, 2011 between the Coalition of
University Employees/IBT Local 2010 and the Regents of the University of
California.

 

2. Agreement effective as of March 8, 2014 between the American Federation of
State, County and Municipal Employees and the Regents of the University of
California.

 

B-1

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EXHIBIT C

ESCROW PROVISIONS

1.    The parties acknowledge that the Escrow Agent is acting solely as a
stakeholder at their request and for their convenience, that the Escrow Agent
shall not be deemed to be the agent of either of the parties, and that the
Escrow Agent shall not be liable to either of the parties for any action or
omission on its part taken or made in good faith, and not in disregard of this
Agreement, but shall be liable for any Liabilities (including reasonable
attorneys’ fees, expenses and disbursements) incurred by Seller or Buyer
resulting from actions or omissions taken or made by the Escrow Agent in bad
faith, in disregard of this Agreement or involving negligence on the part of the
Escrow Agent. Seller and Buyer shall jointly and severally indemnify and hold
the Escrow Agent harmless from and against all Liabilities (including reasonable
attorneys’ fees, expenses and disbursements) incurred in connection with the
performance of the Escrow Agent’s duties hereunder, except with respect to
actions or omissions taken or made by the Escrow Agent in bad faith, in
disregard of this Agreement or involving negligence or willful misconduct on the
part of the Escrow Agent.

2.    Section 6045(e) of the United States Internal Revenue Code and the
regulations promulgated thereunder (herein collectively called the “Reporting
Requirements”) require an information return to be made to the United States
Internal Revenue Service, and a statement to be furnished to Seller, in
connection with the Transaction. The Escrow Agent is either (x) the person
responsible for closing the Transaction (as described in the Reporting
Requirements) or (y) the disbursing title or escrow company that is most
significant in terms of gross proceeds disbursed in connection with the
Transaction (as described in the Reporting Requirements). Accordingly:

(a)    The Escrow Agent is hereby designated as the “Reporting Person” (as
defined in the Reporting Requirements) for the Transaction. The Escrow Agent
shall perform all duties that are required by the Reporting Requirements to be
performed by the Reporting Person for the Transaction.

(b)    Seller and Buyer shall furnish to the Escrow Agent, in a timely manner,
any information requested by the Escrow Agent and necessary for the Escrow Agent
to perform its duties as Reporting Person for the Transaction.

(c)    The Escrow Agent hereby requests Seller to furnish to the Escrow Agent
Seller’s correct taxpayer identification number. Seller acknowledges that any
failure by Seller to provide the Escrow Agent with Seller’s correct taxpayer
identification number may subject Seller to civil or criminal penalties imposed
by Law. Accordingly, Seller hereby certifies to the Escrow Agent, under
penalties of perjury, that Seller’s correct taxpayer identification number is
46-5725309.

3.    The provisions of this Exhibit C shall survive Closing (and not be merged
into the Ground Lease Assignment Agreement) or earlier termination of this
Agreement.

[Remainder of page intentionally blank]

 

C-1

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EXHIBIT D

FORM OF GROUND LEASE ASSIGNMENT AGREEMENT

[See next page.]

 

D-1

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RECORDING REQUESTED BY    AND WHEN RECORDED MAIL    DOCUMENT AND TAX   
STATEMENTS TO:   

 

DLA Piper LLP (US)

  

203 North LaSalle St., Suite 1900

Chicago, IL 60601

   Attention: Sandra Kellman, Esq.   

APN: 036-170-023

 

  

 

 

  

THIS SPACE ABOVE FOR RECORDER’S USE

ASSIGNMENT AND ASSUMPTION OF GROUND LEASE DOCUMENTS

THIS ASSIGNMENT AND ASSUMPTION OF GROUND LEASE DOCUMENTS (this “Assignment”) is
made as of January     , 2017 (the “Effective Date”) by and between 173ODRE9 GL
OWNER, LLC, a Delaware limited liability company (“Assignor”), and BREIT DAVIS
PROPERTY OWNER LLC, a Delaware limited liability company (“Assignee”).

WHEREAS, Assignor is the owner of the ground leasehold interest in and to
certain premises located in the County of Yolo, State of California as more
particularly described in Exhibit “A” attached hereto and made a part hereof
pursuant to that certain Ground Lease dated as of August 18, 2008 by and between
University Hospitality Group, LLC, a California limited liability company
(“Original Lessee”) and The Regents of the University of California, a
California public corporation (“The Regents”), originally disclosed of record by
that certain Memorandum of Lease dated as of August 18, 2008 and recorded on
October 21, 2008 as Instrument No. 2008-0031841-00 in the Official Records of
Yolo County, California, and as amended by that certain First Amendment to
Ground Lease dated as of June 15, 2012 by and between Original Lessee and The
Regents, as amended by that certain Consent to Assignment and Assumption of and
Amendment to Ground Lease Documents dated as of June 30, 2014 by and among The
Regents, Original Lessee and Assignor, as assigned to Assignor pursuant to that
certain Assignment and Assumption of Ground Lease Documents dated as of June 30,
2014, and recorded on July 2, 2014 as Instrument No. 2014-0014319-00 in the
Official Records of Yolo County, California (the “Assignment of Ground Lease
Documents”) by and between Original Lessee and Assignor, and as further amended
by that certain Consent to Assignment and Assumption of Ground Lease Documents
dated as of even date herewith by and among The Regents, Assignor and Assignee
(as amended and assigned, collectively, the “Ground Lease”); and

WHEREAS, in connection with the Ground Lease, The Regents and Original Lessee
entered into (i) that certain Campus Services Agreement dated as of August 18,
2008, as assigned to Assignor pursuant to that certain Assignment of Ground
Lease Documents (as assigned, collectively, the “Campus Services Agreement”),
(ii) that certain Infrastructure Agreement dated as of August 18, 2008, as
assigned to Assignor pursuant to that certain Assignment of Ground Lease
Documents (as assigned, collectively, the “Infrastructure Agreement”) and
(iii) that certain Amended and Restated Employee Services Agreement dated

 

D-2

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as of July 30, 2012, as assigned to InnVentures IVI, LP, a Delaware limited
partnership (“Operator”) pursuant to that certain Assignment and Assumption of
Employee Services Agreement dated as of July 30, 2014 by and between Original
Lessee and Operator (as assigned, collectively, the “Employee Services
Agreement”). The Ground Lease, the Campus Services Agreement, the Infrastructure
Agreement and the Employee Services Agreement are collectively referred to as
the “Ground Lease Documents”; and

WHEREAS, Assignor and Assignee entered into that certain Purchase and Sale
Agreement dated of even date herewith (the “Purchase Agreement”), pursuant to
which Assignor has agreed to assign to Assignee, and Assignee has agreed to
assume from Assignor, all of Assignor’s rights, duties and obligations under the
Ground Lease Documents. Capitalized terms used herein but not defined shall have
the meaning given to such terms in the Purchase Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Assignor and Assignee hereby agree as follows:

1.    Assignment by Assignor. Assignor hereby assigns, sells, transfers, sets
over and conveys to Assignee, and its successors and assigns, all of Assignor’s
right, title and interest in and to the Ground Lease Documents, except as
provided in Section 2 below.

2.    Acceptance and Assumption by Assignee. Assignee hereby accepts the
foregoing assignment and transfer and assumes and agrees to fulfill, perform,
discharge and comply with all of the rights, duties and obligations of Assignor
under the Ground Lease Documents to be performed on or after the Effective Date;
provided, however, that as of the Effective Date, pursuant to an Operating Lease
between Assignee and BREIT Davis TRS LLC, BREIT Davis TRS LLC has retained
Operator to manage the Hotel and Operator shall continue to be the counterparty
with The Regents to the Employee Services Agreement.

3.    Successors and Assigns; Third-Party Beneficiaries. The terms, covenants
and conditions herein contained shall be binding upon and inure to the benefit
of the successors and assigns of the parties hereto. Nothing contained in this
Assignment is intended by the parties, nor shall any provision of this
Assignment be deemed or construed by the parties or by any third person, to be
for the benefit of any third party, nor shall any third party have any right to
enforce any provision of this Assignment or be entitled to damages for any
breach by Assignor or Assignee of any of the provisions of this Assignment.

4.    Entire Agreement; Amendments to Assignment. This Assignment and the
Purchase Agreement constitute the entire understanding between the parties with
respect to the subject matter hereof. Any prior correspondence, memoranda or
agreements (other than the Purchase Agreement) are replaced in total by this
Assignment. This Assignment may be amended or modified only by a written
instrument signed by both Assignor and Assignee. No claim of amendment based on
oral statements or course of conduct shall bind the other party.

5.    Further Assurances. Each party agrees to execute such other and further
instruments and documents as may be reasonably necessary or proper in order to
consummate the transaction contemplated by this Assignment.

 

D-3

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6.    Governing Law. This Assignment shall be governed by and construed in
accordance with the laws of the State of California as applied to agreements
among California residents which are entered into and performed entirely within
California. In the event of a dispute or claim under this Assignment, the
parties submit to the exclusive jurisdiction of the state and federal courts
located in San Francisco County, California.

7.    Counterparts; Electronic Signatures. This Assignment may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which taken together shall constitute one and the same instrument. Delivery by
one party to another of execution pages of this Assignment by electronic
transmission shall be sufficient to bind the party so delivering such execution
pages.

8.    Limitation on Liability. This Assignment is made without any covenant,
warranty or representation by, or recourse against, Assignor, other than
Seller’s Warranties (as defined in the Purchase Agreement), to the extent
applicable. Assignor’s liability under this Assignment shall be limited as set
forth in Sections 4.5 and 7.3 of the Purchase Agreement.

[Remainder of page intentionally left blank; Signatures on following pages.]

 

D-4

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IN WITNESS WHEREOF, Assignor and Assignee have caused this Assignment to be
executed and delivered in their names by their respective duly authorized
officers or representatives as of the date first written above.

 

ASSIGNOR:

173ODRE9 GL OWNER, LLC,

a Delaware limited liability company

By:  

 

Name:  

 

Title:  

 

 

[Signature Page – Assignment and Assumption of Ground Lease Documents]

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

ASSIGNEE:

BREIT DAVIS PROPERTY OWNER LLC,

a Delaware limited liability company

By:  

 

Name:  

 

Title:  

 

 

[Signature Page – Assignment and Assumption of Ground Lease Documents]

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

The undersigned consents to the foregoing Assignment.

 

THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,

a California public corporation

By:  

 

Name:  

 

Title:  

 

 

[Signature Page – Assignment and Assumption of Ground Lease Documents]

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

 

A notary public or other officer completing this certificate verifies only the
identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or validity of that document.

 

  

STATE OF CALIFORNIA                         }

COUNTY OF                                            } S.S.

On                                                  ,                
              before me,                        
                                         
                                                 
                                         
                                                                            , a
Notary Public in and for said County and State,
personally appeared,                                     
                                         
                                         
                                                                
                                        
                                         
                                         
                                         
                                                     
                                         
                                         
                                      , who proved to me on the basis of
satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature:                                          
                               

 

[Signature Page – Assignment and Assumption of Ground Lease Documents]

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

 

A notary public or other officer completing this certificate verifies only the
identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or validity of that document.

 

  

STATE OF CALIFORNIA                        }

COUNTY OF                                            } S.S.

On                                                  ,                
              before me,                        
                                         
                                                 
                                         
                                                                            , a
Notary Public in and for said County and State,
personally appeared,                                     
                                         
                                         
                                                                
                                        
                                         
                                         
                                         
                                                     
                                         
                                         
                                      , who proved to me on the basis of
satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature:                                          
                               

Signature:                                                                
(Seal)

 

[Signature Page – Assignment and Assumption of Ground Lease Documents]

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A notary public or other officer completing this certificate verifies only the
identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or validity of that document.

 

  

STATE OF CALIFORNIA                       }

COUNTY OF                                            } S.S.

On                                                  ,                
              before me,                        
                                         
                                                 
                                         
                                                                            , a
Notary Public in and for said County and State,
personally appeared,                                     
                                         
                                         
                                                                
                                        
                                         
                                         
                                         
                                                     
                                         
                                         
                                      , who proved to me on the basis of
satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature:                                          
                               

 

[Signature Page – Assignment and Assumption of Ground Lease Documents]

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EXHIBIT “A”

LEGAL DESCRIPTION

All that certain real property situated in the County of Yolo, State of
California, described as follows:

Unincorporated Area

Parcel One:

Being a portion of Section 15, Township 8 North, Range 2 East, Mount Diablo
Meridian, described as follows:

Commencing at the Southwest corner of that certain parcel of land conveyed to
the State of California by Deed recorded February 19, 1960 in Book 1015 of
Solano County Official Records, at Page 379 as Instrument No. 3306, said point
being on the Southeasterly right of way line of the Union Pacific Railroad and
also being the most Northerly corner of Parcel Three, as said Parcel is
described in that certain Quitclaim Deed from John Whitcombe, et al to John S.
and Mary Y. Nishi, recorded on March 18, 1998 as Document No. 98-0006962,
Official Records of Yolo County; thence North 14 degrees 29’ 53” East, 540.26
feet to the true point of beginning; thence North 55 degrees 10’ 36” West,
105.10 feet; thence North 26 degrees 56’ 50’ West, 203.04 feet; thence North 45
degrees 04’ 28” East, 21.28 feet; thence North 44 degrees 55’ 32” West, 41.99
feet to a point from which an iron bar with cap marked LS 5435 bears South 45
degrees 04’ 28” West, 324.64 feet; thence North 45 degrees 04’ 28” East, 289.27
feet to an iron bar with cap marked LS 5435; thence North 45 degrees 04’ 28”
East, 124.02 feet; thence 217.48 feet along a curve to the right, said curve
having a radius of 354.27 feet, a central angle of 35 degrees 10’ 22”, and being
subtended by a chord bearing South 16 degrees 58’ 14” East, 214.08 feet to a
point from which a 5/8” rebar with 1-1/2” aluminum cap marking University of
California at Davis Survey Control Point No. 533 bears North 81 degrees 52’ 24”
East, 259.11 feet; thence 251.67 feet along a curve to the right, said curve
having a radius of 383.00 feet, a central angle of 37 degrees 38’ 58”, and being
subtended by a chord bearing South 15 degrees 59’ 55” West, 247.17 feet; thence
South 34 degrees 49’ 24” West, 164.79 feet to the true point of beginning.

Parcel Two:

A non-exclusive easement on, over, across and through the Campus via campus
roads, pathways and sidewalks for all forms of pedestrian and vehicular ingress,
egress and access between the premises and the public streets and roadways
abutting the Campus as contained in and subject to the Lease dated August 18,
2008 as referenced in the Memorandum of Lease recorded October 21, 2008 as
Instrument No. 2008-0031841, Official Records.

APN: 036-170-023

 

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EXHIBIT E

FORM OF BILL OF SALE

THIS BILL OF SALE (this “Bill of Sale”), is executed as of January     , 2017 by
173ODRE9 GL Owner, LLC, a Delaware limited liability company (“Seller”), for the
benefit of BREIT DAVIS TRS LLC, a Delaware limited liability company (“TRS”).

W I T N E S S E T H:

WHEREAS, pursuant to the terms of that certain Purchase and Sale Agreement,
dated of even date herewith, by and between Seller and BREIT Davis Property
Owner LLC (“Buyer”) (as the same may have been amended, modified or assigned,
the “Purchase Agreement”), Seller agreed to sell to Buyer, inter alia, the
Property as more particularly defined and described in the Purchase Agreement,
including the hotel known as the Hyatt Place, UC Davis, located at 173 Old Davis
Road Extension, Davis, California 95616. Capitalized terms not otherwise defined
herein shall have the respective meanings ascribed to such terms in the Purchase
Agreement.

WHEREAS, by the Assignment and Assumption of Ground Lease Documents of even date
herewith, Seller conveyed its ground leasehold interest in and to the Hotel to
Buyer.

WHEREAS, Buyer and TRS have entered into an Operating Lease Agreement pursuant
to which Buyer leases to TRS certain property described therein.

WHEREAS, in connection with the above described conveyance, Seller desires to
sell, transfer and convey to TRS certain items of tangible and intangible
Personal Property as hereinafter described.

NOW, THEREFORE, in consideration of the receipt of TEN AND NO/100 DOLLARS
($10.00) and other good and valuable consideration paid in hand by Buyer to
Seller, the receipt and sufficiency of which are hereby acknowledged, Seller has
SOLD, TRANSFERRED, and CONVEYED and by these presents does hereby SELL,
TRANSFER, and CONVEY to TRS, and TRS hereby accepts, all of Seller’s right,
title and interest in and to:

(i)    all tangible Personal Property owned by Seller, including all FF&E,
Consumables, Food and Beverage Inventory, Operating Equipment, Inventory, and
other tangible personal property of every kind and nature (which does not
include cash-on-hand, FF&E reserves, accounts or reserves held by Seller’s
existing mortgage lender, any Replacement Reserve Fund established or maintained
by Seller and “house banks”) that is located on, in or about and used in
connection with the ownership, operation and maintenance of the Hotel, except
(a) any tangible Personal Property leased by Seller or owned or leased by Hotel
Manager or any hotel guest and (b) any Protected Personal Property;

(ii)    all intangible Personal Property owned by Seller, including the
Intangible Property, the Bookings, the Hotel Records, and, to the extent
assignable, the Licenses and Permits, but specifically excluding any Protected
Materials, Protected Personal Property and any computer software that is
licensed to Seller; and

 

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(iii)    any subsisting and assignable warranties and guaranties relating to the
improvements located at the Hotel or any tangible Personal Property or any part
thereof;

in each case, subject to (i) all terms and provisions hereof and in the Purchase
Agreement and (ii) the Permitted Exceptions to the full extent the same are
existing and affect or pertain to the Personal Property, but otherwise free and
clear of all liens, encumbrances and claims.

To the extent Seller has any liability under this Bill of Sale, Seller’s
liability under this Bill of Sale shall be limited as set forth in Sections 4.5
and 7.3 of the Purchase Agreement.

Except for any representations and warranties contained in the Purchase
Agreement solely for which Buyer may maintain an action for breach subject to
the terms and conditions of the Purchase Agreement and only to the extent such
representations and warranties survive the Purchase Agreement as provided
therein, the Personal Property is hereby conveyed on an “as is” “where is” and
“with all faults” basis and no Seller Party has made, nor any Seller Party
liable for or bound in any manner by any express or implied warranties,
guarantees, promises, statements, inducements, warranty of fitness for a
particular purpose, representations or information pertaining to the Personal
Property or any part thereof, the physical condition, income, expenses or
operation thereof, the uses which can be made of the same or any other matter or
thing with respect thereto. Without limiting the foregoing, Seller shall not be
liable for or be bound by any oral or written statements or representations
pertaining to the condition or use of the Personal Property, or any other
information respecting same furnished by any Seller Party or other person
purportedly representing any Seller Party. By acceptance of this Bill of Sale,
TRS acknowledges and agrees to the foregoing and represents that, without
limiting any of TRS’s rights contained herein or Buyer’s rights contained in the
Purchase Agreement or the representations, warranties and covenants set forth in
the Purchase Agreement, as of the date hereof, it shall have independently
investigated, analyzed and appraised to its satisfaction the value and the
profitability of the Personal Property.

[Remainder of page intentionally blank]

 

E-2

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IN WITNESS WHEREOF, the undersigned has executed this Bill of Sale to be
effective as of the date first set forth hereinabove.

 

SELLER:

173ODRE9 GL OWNER, LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

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EXHIBIT F

FORM OF OMNIBUS ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS OMNIBUS ASSIGNMENT AND ASSUMPTION AGREEMENT (this “Assignment”), is made as
of January     , 2017 by and among 173ODRE9 GL OWNER, LLC, a Delaware limited
liability company (“Assignor”), and BREIT DAVIS TRS LLC, a Delaware limited
liability company (“Assignee”).

W I T N E S S E T H:

WHEREAS, pursuant to the terms of that certain Purchase and Sale Agreement,
dated of even date herewith, by and between BREIT Davis Property Owner LLC
(“Buyer”) and Assignor (as the same may have been amended, modified or assigned,
the “Purchase Agreement”), Assignor agreed to sell to Buyer, inter alia, the
Property as more particularly defined and described in the Purchase Agreement,
including the Hotel known as the Hyatt Place, UC Davis, located at 173 Old Davis
Road Extension, Davis, California 95616. Capitalized terms not otherwise defined
herein shall have the respective meanings ascribed to such terms in the Purchase
Agreement.

WHEREAS, Buyer and Assignee have entered into an Operating Lease Agreement
pursuant to which Buyer leases to Assignee certain property described therein.

WHEREAS, the Purchase Agreement provides, inter alia, that Assignor and Buyer or
its affiliate shall enter into this Assignment.

NOW, THEREFORE, in consideration of the Property, the Purchase Price and the
mutual covenants herein contained, the parties hereto hereby agree as follows:

1.    Assignment of Contracts. Assignor hereby assigns, sets over and transfers
to Assignee all of Assignor’s right, title and interest in, to and under all
Owner Service Contracts relating to the Hotel set forth on Exhibit A attached
hereto. Assignee hereby accepts the foregoing assignment of such Owner Service
Contracts and assumes the obligations of Assignor with respect thereto from and
after the date hereof. Assignor and Assignee acknowledge and agree that the
Manager Service Contracts set forth on Exhibit B attached hereto have been
entered into in the name of the Hotel or the Hotel Manager and are not being
assigned to Assignee.

2.    No Modification of Purchase Agreement. As between Assignor and Assignee,
this Agreement does not enlarge, restrict or otherwise modify the terms of the
Purchase Agreement or constitute a waiver or release by Assignor or Assignee of
any liabilities, duties or obligations imposed upon them (or any of their
respective affiliates) by the terms of the Purchase Agreement, including without
limitation the representations, warranties, covenants, agreements,
indemnifications and other provisions of the Purchase Agreement. As between
Assignor and Assignee, in the event of any conflict or inconsistency between the
terms of the Purchase Agreement and the terms hereof, the terms of the Purchase
Agreement shall govern.

 

F-1

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3.    Limitation on Liability. This Assignment is made without any covenant,
warranty or representation by, or recourse against, Assignor, other than
Seller’s Warranties (as defined in the Purchase Agreement), to the extent
applicable. Assignor’s liability under this Assignment shall be limited as set
forth in Sections 4.5 and 7.3 of the Purchase Agreement.

4.    Miscellaneous. This Assignment and the obligations of the parties
hereunder shall be binding upon and inure to the benefit of the parties hereto,
their respective legal representatives, successors and assigns, shall be
governed by and construed in accordance with the laws of the State of New York
applicable to agreements made and to be wholly performed within said State and
may not be modified or amended in any manner other than by a written agreement
signed by the party to be charged therewith.

5.    Severability. If any term or provision of this Assignment or the
application thereof to any persons or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Assignment or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby, and each term
and provision of this Assignment shall be valid and enforced to the fullest
extent permitted by law.

6.    Counterparts. This Assignment may be executed in counterparts, each of
which shall be an original and all of which counterparts taken together shall
constitute one and the same agreement and may be delivered by e-mail, pdf or
other electronic transmission.

[Remainder of page intentionally blank]

 

F-2

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IN WITNESS WHEREOF, the undersigned have executed this Assignment to be
effective as of the date first set forth hereinabove.

 

ASSIGNOR:

173ODRE9 GL OWNER, LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

F-3

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ASSIGNEE: BREIT DAVIS TRS LLC, a Delaware limited liability company By:  

 

Name:   Title:  

 

F-4

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Exhibit A

Owner Service Contracts

 

    

Vendor

  

Service

  

Contract Date

1    ThyssenKrupp Elevator    Vertical Transportation Agreement    March 1, 2010
2    Oracle America, Inc.    Agreement / POS System    Signed November 11, 2015

 

F-5

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Exhibit B

Manager Service Contracts

 

   

Vendor

 

Service

 

Contract Date

1   Caltronics Business Systems   Lease Agreement - Konica Minolta C308
(scanner/copier/printer/fax)   Signed by Hyatt September 14, 2016 2   Caltronics
Business Systems   Prestige Maintenance Agreement   Signed by Hyatt
September 14, 2016 3   American Society of Composers, Authors and Publishers  
License Agreement   November 19, 2015 4   Sesac LLC   License Agreement  
Effective July 1, 2014 5   Trustwave Holdings, Inc.   Agreement   Effective
March 20, 2016 6   Ecolab Pest Elimination   Pest Elimination Services Agreement
  August 9, 2016 7   Telecom Design Solutions   PBX Telephone System   March 1,
2011 8   Centrada Solutions, LLC   Master Service Agreement   Undated 9   Iron
Mountain   Customer Agreement   Effective December 1, 2015 10   LodgeNet
Interactive Corporation   TV Agreement   Signed by LodgeNet February 9, 2010 11
  LodgeNet Interactive Corporation   Free-to Guest License Agreement   Signed by
LodgeNet February 26, 2010 12   AT&T   Data Circuit Agreement   February 25,
2014 13   AT&T   Voice Circuit Agreement   December 20, 2013 14   USA Today  
National Agreement   Undated 15   Safe Side Security   Alarm System Services
Agreement   August 17, 2011 16   BMI   Music Licensing   December 12, 2016 17  
Unigest   Public Access Computer System Agreement   January 14, 2010

 

F-5

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EXHIBIT G

FORM OF FIRPTA AFFIDAVIT

January     , 2017

Section 1445 of the Internal Revenue Code provides that a transferee of a United
States real property interest must withhold tax if the transferor is a foreign
person. For U.S. tax purposes (including Section 1445), the owner of a
disregarded entity (which has legal title to a U.S. real property interest under
local law), and not the disregarded entity, will be the transferor of the
property. 173ODRE9 HOLDINGS, LLC, a Delaware limited liability company
(“Transferor”), is the direct owner of all of the beneficial interests in
173ODRE GL Owner, LLC, a Delaware limited liability company (“Seller”). To
inform the transferee that withholding of tax is not required upon the
disposition of a United States real property interest by Seller, Transferor
hereby certifies the following:

7.    Transferor is not a foreign corporation, foreign partnership, foreign
trust, or foreign estate (as those terms are defined in the Internal Revenue
Code and Income Tax Regulations); and

8.    Transferor is not a disregarded entity as defined in §1.1445-2(b)(2)(iii)
of the Internal Revenue Code; and

9.    Transferor’s U.S. employer taxpayer identification number is 46-5764228;
and

10.    Transferor’s office address is 7121 Fairway Drive, Suite 410, Palm Beach
Gardens, Florida 33418.

Transferor understands that this certification may be disclosed to the Internal
Revenue Service by transferee and that any false statement contained herein
could be punished by fine, imprisonment, or both.

[Signature Page Follows]

 

G-1

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Dated as of the day and year first above written.

 

TRANSFEROR:

173ODRE9 HOLDINGS, LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

G-2

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EXHIBIT H

INTENTIONALLY DELETED

 

H-1

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EXHIBIT I

FORM OF OWNER’S AFFIDAVIT

The undersigned (the “Undersigned”) hereby certifies to Chicago Title Insurance
Company (the “Company”) as of January     , 2017 that, to the Undersigned’s
knowledge:

 

  1. The Undersigned has not previously conveyed its leasehold interest in that
certain real property (the “Premises”) described in that certain title
commitment dated as of December 1, 2016 issued by the Company under file no.
00065643-001-TG3-DB nor has the Undersigned permitted anyone to occupy the
Premises other than the hotel manager, hotel guests and pursuant to the Leases
(defined below).

 

  2. Except for the work described on Exhibit A attached hereto (the “Work”), no
labor, services or materials have been furnished in connection with the
construction or repair of any buildings or other improvements on the Premises,
other than for ordinary maintenance and repair, by virtue of an agreement with,
or by the consent of, the Undersigned, during the preceding 90 days which could
give rise to a mechanic’s lien.

 

  3. The only leases which affect the Premises are those listed on Exhibit B
attached hereto (the “Leases”). The Leases contain no rights or options to
purchase the Premises.

 

  4. In consideration of the Company issuing an owner’s policy of title
insurance to BREIT Davis Property Owner LLC, a Delaware limited liability
company (“Buyer”) (a) without making exception therein for, and for providing
affirmative insurance against, statutory liens for labor or material arising by
reason of the Work (“mechanics’ liens”) and (b) without making exception therein
for matters first appearing in the public records between 8:00 A.M. on January
    , 2017 and 4:00 P.M. on January     , 2017 (the “Gap”), the Undersigned
agrees to remove, bond or otherwise dispose of (i) any mechanics’ liens and
(ii) any other lien, encumbrance or objectionable matter to title which are
filed during the Gap, in each case as a direct result of the Undersigned’s
actions or omissions (collectively, “objection(s) to title”), and to indemnify
and hold the Company harmless from and against any actual out of pocket costs or
expenses incurred by the Company which arise out of the Undersigned’s failure to
remove, bond or otherwise dispose of any such objection(s) to title.

 

  5. There are no unpaid sellers or suppliers of commodities or products for the
Premises that are governed by the Perishable Agricultural Commodities Act of
1930, as amended, 7 USC 499a et seq. or the Packers and Stockyard Act of 1921,
as amended, 7 USC 181 et seq. (hereafter referred to in the aggregate as
“PACA/PASA”), other than invoices not more than ten (10) days outstanding which
will be paid in the ordinary course of business. No written notices of claim or
written notices of intent to preserve claim rights have been received by the
Undersigned from PACA/PASA sellers or suppliers for the Premises. There are no
parties claiming to hold or assert rights, claims or interests under PACA/PASA
against the Undersigned.

 

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The Undersigned makes this affidavit for the purpose of inducing the Company to
issue an owner’s policy of title insurance to Buyer. The statement “to the
Undersigned’s knowledge” shall mean that the Undersigned has no knowledge that
such statement is untrue (and, for this purpose, the Undersigned’s knowledge
shall mean the present actual knowledge, without a duty of investigation or
inquiry (excluding constructive or imputed knowledge) of Mr. Matt Kenney, but
such individual shall not have any personal liability in connection therewith).
Notwithstanding anything to the contrary herein, to the extent the Company shall
have knowledge as of the date hereof that any of the statements contained herein
is false or inaccurate, then the Undersigned shall have no liability with
respect to the same. The Company shall be deemed to have knowledge of any
matters of record.

No present or future direct or indirect partner, member, advisor, trustee,
director, officer, employee, beneficiary, shareholder, participant or agent of
the Undersigned, shall have any personal liability, directly or indirectly,
under or in connection with this affidavit; and the Company hereby waives any
and all such personal liability. The limitations of liability provided in this
paragraph are in addition to, and not in limitation of, any limitation on
liability applicable provided by law or by any other contract, agreement or
instrument.

[Signature page follows]

 

I-2

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Dated as of the day and year first above written.

 

173ODRE9 GL OWNER, LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

I-3

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EXHIBIT A

WORK

Roof repairs at the Premises described in that certain Roof Care Proposal dated
January 16, 2017 from NIR Roof Care, Inc. ($3,625).

 

I-4

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EXHIBIT B

LEASES

None

 

I-5

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EXHIBIT J

INTENTIONALLY DELETED

 

J-1

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EXHIBIT K

FORM OF LANDLORD CONSENT

[See next page.]

 

K-1

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CONSENT TO ASSIGNMENT AND ASSUMPTION OF AND

AMENDMENT TO GROUND LEASE DOCUMENTS

THIS CONSENT TO ASSIGNMENT AND ASSUMPTION OF AND AMENDMENT TO GROUND LEASE
DOCUMENTS (this “Agreement”) dated January     , 2017 (the “Effective Date”), is
entered into by and between THE REGENTS OF THE UNIVERSITY OF CALIFORNIA (the
“University”), 1730DRE9 GL OWNER, LLC, a Delaware limited liability company
(“Seller”), and BREIT DAVIS PROPERTY OWNER LLC, a Delaware limited liability
company (“Buyer”), in the following factual context:

A.    The University and Seller are parties to that certain Ground Lease made as
of August 8, 2008, as amended by the First Amendment to Ground Lease made as of
June 15, 2012, as further amended by that certain Consent to Assignment and
Assumption of and Amendment to Ground Lease Documents, dated as of June 30,
2014, between the University, Seller and University Hospitality Group, LLC
(collectively, the “Ground Lease”), with respect to the construction and
operation of that certain hotel (the “Hotel”) located at the University’s Davis
campus on the land more particularly described in Exhibit A (“Leased Land”)
attached hereto and made a part hereof (together with the Hotel and other
improvements located thereon, the “Property”). Any capitalized term used, but
not defined, in this Agreement shall have the meaning ascribed to such term in
the Ground Lease.

B.    In connection with the Ground Lease, Seller and the University executed
that certain (a) Campus Services Agreement concurrently with the Ground Lease
dated as of August 18, 2008 (the “Campus Services Agreement”),
(b) Infrastructure Agreement concurrently with the Ground Lease dated as of
August 18, 2008 (the “Infrastructure Agreement”), and (c) Amended & Restated
Employee Services Agreement dated as of July 30, 2012 (the “Employee Services
Agreement”, together with the Ground Lease, the Campus Services Agreement and
the Infrastructure Agreement, collectively, the “Ground Lease Documents”). The
Ground Lease, the Campus Services Agreement and the Infrastructure Agreement are
collectively referred to as the “Assigned Ground Lease Documents”.

C.    Seller desires to assign, sell, transfer, set over and convey to Buyer,
and its successors and assigns, of all of Seller’s right, title and interest in
and to the Assigned Ground Lease Documents, all pursuant to that certain
Agreement of Purchase and Sale dated as of January     , 2017 (as amended, the
“Purchase Agreement”). The Purchase Agreement and the documents effectuating the
sale of the Property and assignment of the Assigned Ground Lease Documents are
collectively referred to herein as the “Purchase Documents”. The closing of the
sale of the Property in accordance with the Purchase Agreement is referred to
herein as the “Closing”.

D.    The University is willing to consent to the assignment, sale, transfer,
setting over and conveying by Seller of all of its right, title and interest in
and to the Assigned Ground Lease Documents to Buyer pursuant to the Purchase
Documents, and is willing to amend the Ground Lease as set forth in this
Agreement, all in accordance with and subject to the terms and conditions of
this Agreement.

NOW, THEREFORE, and for valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree hereby as follows:

1.    Consent to Assignment. Pursuant to Section 23.1 of the Ground Lease, the
University consents to the assignment, sale, transfer, setting over and
conveying by Seller of all of its right, title and interest in and to the
Assigned Ground Lease Documents to Buyer pursuant to the Purchase Documents and
recognizes Buyer as Seller’s successor-in-interest as the “Tenant” under the
Ground Lease for all purposes under the Ground Lease Documents and Buyer
covenants for the benefit of the University that

 

K-2

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from and after the Closing, the Lease shall be faithfully performed, including,
without limitations the covenant to pay to University all Rent (including
Percentage Rent) as and when due as contemplated by the provisions of Section 3
of the Lease. Seller shall reimburse the University at Closing for University’s
Reimbursed Transaction Expenses as set forth in Section 3.12 of the Ground Lease
in the amount of Fifteen Thousand Dollars ($15,000) which shall be paid through
escrow.

2.    Operating Lease. Tenant represents to the University that Tenant’s
indirect owner is a real estate investment trust (the “REIT”) and, as such,
Tenant shall enter into a sub-ground lease (the “Affiliate Sub-Ground Lease”) of
the Property with another subsidiary of the REIT (the “Affiliate Sublessee”) and
Affiliate Sublessee will enter into the management agreement with Inn Ventures
(as referenced below). Notwithstanding anything to the contrary contained in the
Ground Lease, including, without limitation, Section 23 thereof, Tenant shall
have the right, without Landlord’s consent, to enter into the Sub-Ground Lease
with the Affiliate Sublessee, provided, however, nothing in the foregoing shall
relieve Tenant in any respect from any liability or obligation under the Ground
Lease.

3.    Hotel Management. University acknowledges that the Affiliate Sublessee
under the Affiliate Sub-Ground Lease has entered into an agreement with
INNVENTURES IVI, LP, a Delaware limited partnership (“Inn Ventures”), the
current Operator, to continue to manage the Hotel following Closing. Pursuant to
Section 4.1 of the Ground Lease, the University consents to the engagement of
Inn Ventures as third party operator of the Hotel, and agrees that Inn Ventures
shall continue to constitute the “Operator” for all purposes under the Ground
Lease Documents.

4.    Employee Services Agreement. In connection with the acquisition of the
Property by Seller, Operator, on Seller’s behalf, assumed the Employee Services
Agreement by written assignment from the prior owner. Following Closing,
Operator will continue as the counterparty to the Employee Services Agreement.
Following Closing, Buyer agrees to cause any successor employer of the Hotel
employees to assume the Employee Services Agreement and that any failure by
Buyer, Operator or any permitted successor or assign (collectively, “Employee
Services Agreement Party”) to perform or comply with any term or covenant of the
Employee Services Agreement shall constitute a default by Tenant under the
Ground Lease if such failure continues for a period of ninety (90) days after
written notice thereof by University to an Employee Services Agreement Party,
provided that Buyer shall have the right to cure such default by replacing
Operator or any permitted successor or assign with a replacement Operator under
the Ground Lease that is acceptable to University during such ninety (90) day
period.

5.    Assignment. Section 23.1 of the Ground Lease is hereby amended to include
the following as the last sentence:

“Notwithstanding the foregoing or anything to contrary contained in this Lease,
Landlord’s prior written consent shall not be required for: (a) transfers of
direct or indirect membership, partnership or other interests in Tenant, or the
issuance of new direct or indirect membership, partnership or other interests in
Tenant, so long as Blackstone Real Estate Income Trust, Inc. continues to
control Tenant (either directly or through one or more subsidiaries); (b) any
transfer, redemption or issuance of stock in Blackstone Real Estate Income
Trust, Inc.; (c) any transfer to a successor corporation or other entity
resulting from a merger or consolidation of Tenant or a parent company of Tenant
(including, without limitation, Blackstone Real Estate Income Trust, Inc. or
BREIT Operating Partnership, L.P.); (d) the entering into by Tenant and the
Affiliate Sublessee of the Affiliate Sub-Ground Lease.

Buyer acknowledges and agrees that the amendment contained in this Section 4 is
personal to Buyer and any permitted transferees in connection with the permitted
transfers described in this Section 4.

 

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6.    Determination by Appraisal. For the avoidance of doubt, Landlord
acknowledges and agrees that the Determination by Appraisal to be performed as
of April 1, 2040 pursuant to Section 3.2.1.2 of the Ground Lease applies only to
the determination of the Annual Base Rent amount and shall not modify the
Percentage Rent or other economic terms set forth in the Ground Lease.

7.    Conditions to Consent. It is an express condition to the effectiveness of
this Agreement, including, without limitation Section 1 hereof, that at Closing
University receives in cash amounts due and owing for the period December 1,
2016 through Closing under (a) the Employee Services Agreement in the
approximate amount of $31,484.00; and (b) for utilities with respect to the
Premises in the approximate amount of $4,898.00; and (c) for Rent in the
approximate amount of $7,607.00. At Closing University shall deliver into escrow
a written statement of the exact amounts to be paid University at Closing with
respect to items (a), (b) and (c) above.

8.    Seller is hereby released and discharged of any and all of its obligations
or liability under the Ground Lease Documents to the extent such obligations or
liability first arise or accrue on or following the Close of Escrow.

9.    This Agreement may not be amended in any manner other than by a writing
signed by the University, Seller and Buyer.

10.    The parties hereto agree to do such things, perform such acts, and make,
execute, acknowledge and deliver such documents as may be reasonably necessary
or proper and usual to carry out the purpose of this Agreement in accordance
with its terms.

11.    This Agreement constitutes the entire and integrated agreement between
the parties hereto in respect of the matters addressed herein and supersedes all
prior negotiations, communications, understandings and agreements of the
parties, whether written or oral.

12.    If any court of competent jurisdiction determines any provision of this
Agreement to be invalid, illegal or unenforceable, that portion shall be deemed
severed from the rest, which shall remain in full force and effect, as though
the invalid, illegal or unenforceable portion had never been a part hereof.

13.    If the parties hereto commence any proceedings or actions to enforce the
provisions of this Agreement, the court or body before which the same shall be
brought shall award to the prevailing party therein all of its costs and
expenses in prosecuting such proceedings and actions, including attorneys’ fees
(which includes the allocable cost of in-house counsel), the usual and customary
and lawfully recoverable court costs, and all the expenses in connection
therewith.

14.    This Agreement may be executed in counterparts, and all counterparts
shall constitute but one and the same document, and may be delivered by
facsimile, pdf or other electronic transmission and such transmission shall be
deemed an original.

15.    This Agreement shall be governed by the laws of the State of California.

16.    Except as otherwise amended hereby, all of the terms and provisions of
the Ground Lease shall remain in full force and effect and are ratified and
confirmed by the University, Buyer and Seller. From and after the date hereof,
the “Lease” as such term is used in the Ground Lease Documents shall mean the
Ground Lease, as modified hereby.

 

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17.    Each party by its signature hereto represents to the other parties that
(i) it has full power and authority to execute and deliver this Agreement and to
perform its respective obligations hereunder, (ii) the execution, delivery and
performance of its obligations hereunder have been duly authorized and approved
by all necessary action and (iii) this Agreement constitutes the legal, valid
and binding obligation of such party, enforceable in accordance with its terms.

[The remainder of this page intentionally left blank]

 

K-5

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IN WITNESS WHEREOF, the University, Seller and Buyer executed this Agreement as
of the day and year first above written.

 

UNIVERSITY:

THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,

a California public corporation

By:  

 

Name:   Title:  

 

[Signature Page – Consent to Assignment and Assumption of and Amendment to
Ground Lease Documents]

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SELLER:

1730DRE9 GL OWNER, LLC,

a Delaware limited liability company

By:  

 

Name:  

 

Title:  

 

 

[Signature Page – Consent to Assignment and Assumption of and Amendment to
Ground Lease Documents]

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BUYER:

BREIT DAVIS PROPERTY OWNER LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

[Signature Page – Consent to Assignment and Assumption of and Amendment to
Ground Lease Documents]

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Exhibit A

Legal Description

All that certain real property situated in the County of Yolo, State of
California, described as follows:

Unincorporated Area Parcel One:

Being a portion of Section 15, Township 8 North, Range 2 East, Mount Diablo
Meridian, described as follows:

Commencing at the Southwest corner of that certain parcel of land conveyed to
the State of California by Deed recorded February 19, 1960 in Book 1015 of
Solano County Official Records, at Page 379 as Instrument No. 3306, said point
being on the Southeasterly right of way line of the Union Pacific Railroad and
also being the most Northerly corner of Parcel Three, as said Parcel is
described in that certain Quitclaim Deed from John Whitcombe, et al to John S.
and Mary Y. Nishi, recorded on March 18, 1998 as Document No. 98-0006962,
Official Records of Yolo County; thence North 14 degrees 29’ 53” East, 540.26
feet to the true point of beginning; thence North 55 degrees 10’ 36” West,
105.10 feet; thence North 26 degrees 56’ 50’ West, 203.04 feet; thence North 45
degrees 04’ 28” East, 21.28 feet; thence North 44 degrees 55’ 32” West, 41.99
feet to a point from which an iron bar with cap marked LS 5435 bears South 45
degrees 04’ 28” West, 324.64 feet; thence North 45 degrees 04’ 28” East, 289.27
feet to an iron bar with cap marked LS 5435; thence North 45 degrees 04’ 28”
East, 124.02 feet; thence 217.48 feet along a curve to the right, said curve
having a radius of 354.27 feet, a central angle of 35 degrees 10’ 22”, and being
subtended by a chord bearing South 16 degrees 58’ 14” East, 214.08 feet to a
point from which a 5/8” rebar with 1-1/2” aluminum cap marking University of
California at Davis Survey Control Point No. 533 bears North 81 degrees 52’ 24”
East, 259.11 feet; thence 251.67 feet along a curve to the right, said curve
having a radius of 383.00 feet, a central angle of 37 degrees 38’ 58”, and being
subtended by a chord bearing South 15 degrees 59’ 55” West, 247.17 feet; thence
South 34 degrees 49’ 24” West, 164.79 feet to the true point of beginning.

Parcel Two:

A non-exclusive easement on, over, across and through the Campus via campus
roads, pathways and sidewalks for all forms of pedestrian and vehicular ingress,
egress and access between the premises and the public streets and roadways
abutting the Campus as contained in and subject to the Lease dated August 18,
2008 as referenced in the Memorandum of Lease recorded October 21, 2008 as
Instrument No. 2008-0031841, Official Records.

APN: 036-170-023

 

K-9

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EXHIBIT L

FORM OF LANDLORD ESTOPPEL CERTIFICATE

[See next page.]

 

L-1

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LANDLORD’S ESTOPPEL CERTIFICATE

(Hyatt Place - University of California, Davis)

January     , 2017

BREIT SS Holdings LLC

c/o Blackstone Real Estate Advisors

345 Park Avenue, 32nd Floor

New York, New York 10154

1730DRE9 GL Owner, LLC

c/o Westbrook Partners

7121 Fairway Drive, Suite 410

Palm Beach Gardens, FL 33418

 

Re: Ground Lease for Real Property Located on Campus of University of
California, Davis - Sale to BREIT SS Holdings LLC, a Delaware limited liability
company (together with its successors and assigns, collectively, “Purchaser”)

Ladies and Gentlemen:

As of the date of this Estoppel Certificate, The Regents of the University of
California, a California corporation (“Landlord”) hereby certify, represent and
warrant to 1730DRE9 GL Owner, LLC, a Delaware limited liability company
(“Tenant”), Purchaser, any lender making a loan secured by Purchaser’s interest
in the Premises or any direct or indirect interest in Purchaser, any title
company issuing a title policy to Purchaser or any such lender in connection
with the Premises, and their respective successors, participants, members,
managers and assigns (collectively, the “Reliance Parties”), and agree as
follows:

 

6. Landlord is the fee owner of certain real property located on the campus of
the University of California, Davis, and more particularly described in Exhibit
A attached hereto (the “Property”).

 

7. Landlord leases the Property to Tenant pursuant to a certain Ground Lease
dated as of August 18, 2008 (the “Original Ground Lease”), as amended by the
First Amendment to Ground Lease dated as of June 15, 2012, and by the Consent to
Assignment and Assumption of and Amendment to Ground Lease Documents, dated as
of June 30, 2014, and the Consent to Assignment and Assumption of and Amendment
to Ground Lease Documents, dated as of January     , 2017 (the “Consent”) true
and correct copies of which are attached hereto as Exhibit B (collectively, the
“Lease”).

 

8.

In connection with the Lease, Landlord, Tenant and Operator, as applicable, are
parties to (a) the Campus Services Agreement entered into by Tenant and Landlord
concurrently

 

L-2

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  with the Original Ground Lease on August 18, 2008; (b) the Infrastructure
Agreement entered into by Tenant and Landlord on August 18, 2008; and (c) the
Amended & Restated Employee Services Agreement between Tenant and Landlord dated
as of July 30, 2012, as assigned to the current Operator, INNVENTURES IVI, LP,
by assignment dated June 30, 2014 (collectively, the “Ground Lease Documents”).

 

9. The most recent installment of Rent by Tenant in the amount of $40,451.20 was
paid to Landlord on January 18, 2017. The total amount of Rent paid by Tenant to
Landlord with respect to the period commencing April 1, 2016 through the date
hereof is $140,520.42. The current Annual Base Rent payable under the Lease is
$130,000.00, which amount will next be adjusted on April 1, 2020 in accordance
with the terms of the Lease.

 

10. The term of the Lease commenced on August 18, 2008 and will expire on
March 31, 2070.

 

11. All conditions precedent to the effectiveness of the Lease have been
satisfied or waived.

 

12. The Lease and the Ground Lease Documents are in full force and effect and
have not been modified, amended, supplemented or superseded in any way, except
as provided in paragraphs 2 and 3 above.

 

13. Except as set forth in Section 6 of the Consent, Tenant has paid all sums
required to be paid pursuant to the Lease as of the date hereof, and Tenant is
not in default in payment of any amount required to be paid by Tenant pursuant
to the Lease.

 

14. To the best of Landlord’s knowledge, Tenant is not in default in the
performance of any obligation of Tenant under the Lease and Landlord is not
aware of any facts or circumstances which with the passage of time or the giving
of notice, or both, would constitute a default by Tenant under the Lease. No
notice of default has been given by Landlord to Tenant.

 

15. Landlord is not in default in the performance of any of Landlord’s
obligations under the Lease and no facts or circumstances exist which with the
passage of time or the giving of notice, or both, would constitute a default by
Landlord under the Lease. No notice of default has been given by Tenant to
Landlord.

 

16. Landlord has not received any notice of an actual or proposed assignment of
Tenant’s interest under the Lease except in favor of Purchaser (and previously
in favor Tenant’s lender) nor has Landlord approved any such assignment.

 

17. Except as set forth in Section 6 of the Consent, Landlord has no offsets,
claims or defenses against Tenant’s obligations under the Lease.

 

18. Neither Landlord nor Tenant has any right to cancel the Lease except as
expressly permitted in the Lease.

 

L-3

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19. Without limiting the foregoing, Tenant has completed the Expansion
Improvements in accordance with the Lease and in accordance with the Ground
Lease Documents, to the extent that the Ground Lease Documents apply to the
completion of said Expansion Improvements.

 

20. Landlord has reviewed and accepted the Annual Statement for the Premises for
calendar year 2015 and all prior years.

 

21. Tenant is not required to deliver any security deposit to Landlord under the
Lease and is no longer required to maintain any Fee Deposit, Expansion Deposit,
guaranty or other security with Landlord pursuant to the Lease other than the
Replacement Reserve Fund in accordance with Section 4.3 thereof.

 

22. Landlord has full power, authority and legal right to (i) execute and
deliver this Estoppel Certificate and (ii) to carry out its obligations under
the Lease.

 

23. The execution, delivery and performance by Landlord of its obligations under
the Lease have been duly authorized by all necessary action.

 

24. The Lease constitutes legal, valid and binding obligations of Landlord,
enforceable against Landlord in accordance with its terms.

 

25. The execution and delivery of this Estoppel Certificate will not result in a
breach of any of the terms or conditions of, or constitute a default under, any
lien, indenture, encumbrance, agreement, order, judgment or instrument under
which Landlord is a party or by which Landlord or Landlord’s interest in the
Property may be bound or affected, and will not violate any provision of
applicable law.

 

26. To the best of Landlord’s knowledge, there are no actions, suits or
proceedings (whether or not purportedly on behalf of Landlord), pending,
threatened, against or affecting Landlord or the Premises at law or in equity,
before or by any person, which, if adversely determined, would affect the
Premises, the Lease or Landlord’s ability to perform Landlord’s obligations
under the Lease. There has not been filed by or against Landlord a petition in
bankruptcy, voluntary or otherwise, any assignment for the benefit of creditors,
any petition seeking reorganization or arrangement under the bankruptcy laws of
the United States, or any state thereof, or any other action brought under the
bankruptcy laws with respect to Landlord.

Capitalized terms used but not otherwise defined herein shall have the meaning
ascribed to such terms in the Lease.

[The remainder of this page intentionally left blank.]

 

L-4

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This Estoppel Certificate is made to the Reliance Parties in connection with the
prospective sale by Tenant to Purchaser of its interest in the Lease pursuant to
that certain Purchase and Sale Agreement dated as of January     , 2017 by and
between Tenant and Purchaser (as amended, the “Purchase Agreement”), consent to
which has been, or shall be, been given by Landlord pursuant to the Consent.
Landlord acknowledges that the Reliance Parties would not consummate the
transactions contemplated by the Purchase Agreement but for Landlord’s
willingness to make the certificates, representations, warranties and agreements
set forth in this Estoppel Certificate, and that the Reliance Parties will be
relying on them in consummating the transaction contemplated by the Purchase
Agreement. The statements made herein shall be binding upon Landlord, its
successors and assigns. The officers or persons executing this Estoppel
Certificate have been duly empowered to do so on behalf of Landlord.

 

LANDLORD THE REGENTS OF THE UNIVERSITY OF CALIFORNIA, a California public
corporation By:  

 

 

Approved as to Legal Form:

 

                    , University Counsel

 

L-5

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Exhibit A

Legal Description

All that certain real property situated in the County of Yolo, State of
California, described as follows:

Unincorporated Area Parcel One:

Being a portion of Section 15, Township 8 North, Range 2 East, Mount Diablo
Meridian, described as follows:

Commencing at the Southwest corner of that certain parcel of land conveyed to
the State of California by Deed recorded February 19, 1960 in Book 1015 of
Solano County Official Records, at Page 379 as Instrument No. 3306, said point
being on the Southeasterly right of way line of the Union Pacific Railroad and
also being the most Northerly corner of Parcel Three, as said Parcel is
described in that certain Quitclaim Deed from John Whitcombe, et al to John S.
and Mary Y. Nishi, recorded on March 18, 1998 as Document No. 98-0006962,
Official Records of Yolo County; thence North 14 degrees 29’ 53” East, 540.26
feet to the true point of beginning; thence North 55 degrees 10’ 36” West,
105.10 feet; thence North 26 degrees 56’ 50’ West, 203.04 feet; thence North 45
degrees 04’ 28” East, 21.28 feet; thence North 44 degrees 55’ 32” West, 41.99
feet to a point from which an iron bar with cap marked LS 5435 bears South 45
degrees 04’ 28” West, 324.64 feet; thence North 45 degrees 04’ 28” East, 289.27
feet to an iron bar with cap marked LS 5435; thence North 45 degrees 04’ 28”
East, 124.02 feet; thence 217.48 feet along a curve to the right, said curve
having a radius of 354.27 feet, a central angle of 35 degrees 10’ 22”, and being
subtended by a chord bearing South 16 degrees 58’ 14” East, 214.08 feet to a
point from which a 5/8” rebar with 1-1/2” aluminum cap marking University of
California at Davis Survey Control Point No. 533 bears North 81 degrees 52’ 24”
East, 259.11 feet; thence 251.67 feet along a curve to the right, said curve
having a radius of 383.00 feet, a central angle of 37 degrees 38’ 58”, and being
subtended by a chord bearing South 15 degrees 59’ 55” West, 247.17 feet; thence
South 34 degrees 49’ 24” West, 164.79 feet to the true point of beginning.

Parcel Two:

A non-exclusive easement on, over, across and through the Campus via campus
roads, pathways and sidewalks for all forms of pedestrian and vehicular ingress,
egress and access between the premises and the public streets and roadways
abutting the Campus as contained in and subject to the Lease dated August 18,
2008 as referenced in the Memorandum of Lease recorded October 21, 2008 as
Instrument No. 2008-0031841, Official Records.

APN: 036-170-023

 

L-6

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EXHIBIT M

FORM OF ESCROW HOLDBACK AGREEMENT

THIS ESCROW HOLDBACK AGREEMENT (this “Agreement”) is made as of January
    , 2017 (the “Effective Date”), by and between 173ODRE9 GL OWNER, LLC, a
Delaware limited liability company (“Seller”), and BREIT DAVIS PROPERTY OWNER
LLC, a Delaware limited liability company (“Buyer”), and accepted and agreed to
by CHICAGO TITLE INSURANCE COMPANY (“Escrow Agent”).

RECITALS

A.    Seller and Buyer are parties to that certain Purchase and Sale Agreement,
dated of even date herewith (the “Purchase Agreement”), with respect to the
property known as the Hyatt Place, UC Davis, located at 173 Old Davis Road
Extension, Davis, California 95616 (the “Property”). All capitalized terms used
herein and not otherwise defined shall have the same meanings set forth in the
Purchase Agreement.

B.    Pursuant to the Purchase Agreement, at Closing Seller is obligated to
deposit in a segregated interest-bearing escrow account an amount equal to Eight
Hundred Five Thousand Dollars ($805,000.00) (the “Cap Amount”) from the proceeds
from the sale of the Property to secure Seller’s obligation for any Seller’s
Warranty Breach or Seller’s Contingent Retained Liability (as hereinafter
defined).

C.    Pursuant to the Purchase Agreement, at Closing Seller is obligated to
deposit in a segregated interest-bearing escrow account an amount equal to Two
Hundred Forty Thousand Dollars ($240,000.00) (the “Water Damage Escrow”) from
the proceeds of the sale of the Property to pay for the reasonable, actual
out-of-pocket expenses incurred by Buyer in connection with the performance of
Repair Work (as defined in the Purchase Agreement).

NOW, THEREFORE, IN CONSIDERATION OF the foregoing recitals, the mutual
agreements, covenants and promises set forth in this Agreement, and other good
and valuable consideration, the receipt, sufficiency and validity of which is
hereby acknowledged, Seller and Buyer agree as follows:

1.    Holdback Proceeds Escrow. Seller and Buyer hereby agree that at Closing,
Escrow Agent shall hold back from Seller’s proceeds from the sale of the
Property an amount equal to the Cap Amount (the “Holdback Proceeds”) to secure
Seller’s obligation for any Seller’s Warranty Breach or Seller’s Contingent
Retained Liability. Escrow Agent shall (a) invest the Holdback Proceeds in
segregated U.S. Treasury Securities or a segregated Bank of America/Merrill
Lynch treasury securities money market fund or similar account that invests in
U.S. government securities reasonably satisfactory to Seller (“Holdback Proceeds
Escrow”), (b) promptly provide Buyer and Seller with confirmation of the
investments made and (c) disburse the Holdback Proceeds once they have been
removed from the Holdback Proceeds Escrow in accordance with the terms of this
Agreement. Escrow Agent shall not otherwise commingle the Holdback Proceeds with
any funds of Escrow Agent or others. Notwithstanding the foregoing, Escrow Agent
shall not be required to deposit the Holdback Proceeds in an interest-bearing
account until receipt of a fully-executed and completed IRS Form W-9 signed by

 

M - 1

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Seller and reflecting Seller’s taxpayer identification number. Interest on the
Holdback Proceeds will accrue to and be reported to the Internal Revenue Service
for the account of Seller pursuant to the information set forth in such W-9.

2.    Expiration Date. Except as provided in this Section 2, the Holdback
Proceeds shall be held in the Holdback Proceeds Escrow until the date that is
hundred twenty (120) days following the Effective Date (such one hundred twenty
(120) day period, the “Survival Period”), or such later date as herein provided.
If, during the Survival Period, (i) Buyer asserts a claim for a breach of
Seller’s Warranties under the Purchase Agreement (a “Seller’s Warranty Breach”)
or (ii) a third party claim is asserted in writing against Buyer for a Retained
Liability that is not covered by insurance or with respect to which Seller has
not obtained a written agreement from the third party that Buyer is not liable
for any such third party claim (“Seller’s Contingent Retained Liability”,
together with any Seller’s Warranty Breach, each a “Holdback Claim Event”), and
Buyer suffers actual out of pocket damages as a result of such Holdback Claim
Event, individually or in the aggregate, in excess of the Floor Amount, Buyer
shall provide Seller and Escrow Agent with written notice and reasonable
evidence (a “Claim Notice”) describing the underlying Holdback Claim Event and
providing proof of Buyer’s actual out of pocket damages, or if such damages are
not then known or ascertainable, a statement of Buyer’s estimated damages (which
may include out of pocket expenses) (“Damages”) arising directly from such
Holdback Claim Event. Escrow Agent shall continue to hold the Holdback Proceeds
(if the Damages cannot be quantified) or an amount equal to that stated in the
relevant Claim Notice until the claim described in such Claim Notice is resolved
between Buyer and Seller, and any excess Holdback Proceeds shall be released to
Seller upon either (y) Seller’s and Buyer’s respective rights to the Holdback
Proceeds being determined pursuant to a judgment, beyond right of appeal, of a
court of competent jurisdiction in an action in which Seller and Buyer are
parties or (z) Seller and Buyer’s direction Escrow Agent in writing as to how to
disburse the Holdback Proceeds and the amount to be disbursed. On the first
Business Day following the expiration of the Survival Period, upon the request
of Seller and without any additional consent or additional authorization by
Buyer, Escrow Agent shall immediately pay and release to Seller the balance, if
any, of the Holdback Proceeds provided that no Claim Notice has been delivered
prior to the expiration of the Survival Period. If Buyer has delivered a Claim
Notice prior to the expiration of the Survival Period, then upon the request of
Seller and without any additional consent or authorization by Buyer, Escrow
Agent shall immediately pay and release to Seller the balance of the Holdback
Proceeds that is not subject to any such Claim Notice, together with any accrued
interest thereon; provided that all or the portion of the Holdback Proceeds that
is subject to a Claim Notice shall continue to be held by Escrow Agent until
either (y) Seller’s and Buyer’s respective rights to the Holdback Proceeds are
determined pursuant to a judgment, beyond right of appeal, of a court of
competent jurisdiction in an action in which Seller and Buyer are parties or
(z) Seller and Buyer otherwise direct Escrow Agent in writing as to how to
disburse the Holdback Proceeds, and thereafter, Escrow Agent shall immediately
pay and release to Seller the remaining balance of the Holdback Proceeds,
together with any accrued interest thereon, in accordance with such judgment or
written direction, as applicable; provided further, however, that if Buyer has
delivered a Claim Notice with respect to a Holdback Claim Event prior to the
expiration of the Survival Period but Buyer does not file an action in a court
of competent jurisdiction on or before the date that is thirty (30) days
following the expiration of the Survival Period, upon expiration of such thirty
(30) day period Escrow Agent shall immediately pay and release to Seller the
balance of the Holdback Proceeds that was

 

M - 2

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subject to such Claim Notice. For any third party claim asserted in writing
against Buyer for a Retained Liability that is covered by insurance, (a) Seller
shall not settle any such claim without the consent of Buyer, unless Buyer is
released from any and all liability for such Holdback Claim Event, and (b) any
deductible for such Holdback Claim Event shall be retained in the Holdback
Proceeds Escrow until final resolution of such Holdback Claim Event.

3.    Water Damage Escrow. Seller and Buyer hereby agree that at Closing, Escrow
Agent shall hold back from Seller’s proceeds from the sale of the Property an
amount equal to the Water Damage Escrow. Escrow Agent shall (a) invest the Water
Damage Escrow in segregated U.S. Treasury Securities or a segregated Bank of
America/Merrill Lynch treasury securities money market fund or similar account
that invests in U.S. government securities reasonably satisfactory to Seller,
(b) promptly provide Buyer and Seller with confirmation of the investments made
and (c) disburse the Water Damage Escrow in accordance with the terms of this
Agreement. Escrow Agent shall not otherwise commingle the Water Damage Escrow
with any funds of Escrow Agent or others. Notwithstanding the foregoing, Escrow
Agent shall not be required to deposit the Water Damage Escrow in an
interest-bearing account until receipt of a fully-executed and completed IRS
Form W-9 signed by Seller and reflecting Seller’s taxpayer identification
number. Interest on the Water Damage Escrow will accrue to and be reported to
the Internal Revenue Service for the account of Seller pursuant to the
information set forth in such W-9. Upon submission to Seller and the Escrow
Agent of receipts, invoices or other reasonably detailed documentation
evidencing the reasonable, actual out-of-pocket expenses (including Consultant
fees, if any) incurred by Buyer to perform the Repair Work (or any portion
thereof), Escrow Agent shall disburse funds from the Water Damage Escrow to or
at the direction of Buyer in the amount set forth therein. Upon the sooner of
the completion of the Repair Work or one hundred fifty (150) days following
Closing, any remaining funds in the Water Damage Escrow shall be released to
Seller. Any escrow fees incurred in connection with the Water Damage Escrow
shall be shared equally by Buyer and Seller.

4.    Liability of Escrow Agent. The parties acknowledge that Escrow Agent is
acting solely as a stakeholder at their request and for their convenience, that
Escrow Agent shall not be deemed to be the agent of either of the parties, and
that Escrow Agent shall not be liable to either of the parties for (a) any
action or omission on its part taken or made in good faith, and not in disregard
of this Agreement, (b) any losses, costs, damages, claims, liabilities, demands
or obligations in connection with the Holdback Proceeds or Water Damage Escrow
if such losses, costs, damages, claims, liabilities, demands or obligations
resulting from the failure, insolvency or suspension of Escrow Bank or
(c) interest on the Holdback Proceeds or Water Damage Escrow, including, without
limitation, any loss of interest due to any delays in the withdrawal of the
Holdback Proceeds or Water Damage Escrow that may be imposed by Escrow Bank as a
result of the depositing or redeeming of the Holdback Proceeds or Water Damage
Escrow pursuant to Escrow Agent’s instructions; provided, however, that Escrow
Agent shall be liable for any actual, out-of-pocket losses, costs, damages,
claims, liabilities, expenses (including reasonable attorneys’ fees, expenses
and disbursements), demands or obligations (“Liabilities”) incurred by Seller or
Buyer resulting from actions or omissions taken or made by Escrow Agent in bad
faith, in disregard of this Agreement or involving negligence on the part of
Escrow Agent. Seller and Buyer shall jointly and severally indemnify and hold
Escrow Agent harmless from and against all Liabilities incurred in connection
with the performance of Escrow Agent’s duties hereunder, except with respect to
actions or omissions taken or made by Escrow Agent in bad faith, in disregard of
this Agreement or involving negligence or willful misconduct on the part of
Escrow Agent.

 

M - 3

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5.    Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of each of the parties hereto and their respective successors and
assigns.

6.    Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.

7.    Severability. If any term or provision of this Agreement shall, to any
extent, be held invalid or unenforceable, the remaining terms and provisions of
this Agreement shall not be affected thereby, but each remaining term and
provision shall be valid and enforced to the fullest extent permitted by law.

8.    Captions. The captions of this Agreement are inserted solely for
convenience of reference only and do not define, describe or limit the scope or
intent of this Agreement or any term hereof.

9.    Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall be deemed to be an original and all of which
shall be deemed to constitute one and the same instrument. Signatures to this
Agreement transmitted by .pdf or other electronic transmission shall be valid
and effective to bind the party so signing.

10.    Notices. All notices under this Agreement shall be sent in the manner set
forth in the Purchase Agreement.

[Signature Pages Immediately Follow]

 

M - 4

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IN WITNESS WHEREOF, Seller and Buyer have caused their duly authorized
representatives to execute this Agreement as of the date first set forth above.

 

SELLER:

173ODRE9 GL OWNER, LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

M - 5

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BUYER: BREIT DAVIS PROPERTY OWNER LLC, a Delaware limited liability company By:
 

 

Name:   Title:  

 

M - 6

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ESCROW AGENT JOINDER

Escrow Agent hereby accepts the foregoing instructions and agrees to comply
therewith.

 

CHICAGO TITLE INSURANCE COMPANY By:  

 

Name:  

 

Its:  

 

 

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EXHIBIT N

FORM OF KEY MONEY GUARANTY ASSIGNMENT

THIS ASSIGNMENT OF KEY MONEY GUARANTY (this “Assignment”), is made as of January
    , 2017 by 173ODRE9 GL OWNER, LLC, a Delaware limited liability company
(“Assignor”), to and for the benefit of BREIT DAVIS TRS LLC (“Assignee”).

W I T N E S S E T H:

WHEREAS, pursuant to the terms of that certain Purchase and Sale Agreement,
dated of even date herewith, by and between BREIT DAVIS PROPERTY OWNER LLC
(“Owner”) and Assignor (as the same may have been amended, modified or assigned,
the “Purchase Agreement”), Assignor agreed to sell to Owner, inter alia, the
Property as more particularly defined and described in the Purchase Agreement,
including the Hotel known as the Hyatt Place, UC Davis, located at 173 Old Davis
Road Extension, Davis, California 95616. Capitalized terms not otherwise defined
herein shall have the respective meanings ascribed to such terms in the Purchase
Agreement.

WHEREAS, Assignor is the beneficiary of that certain Key Money Guaranty dated as
of June 30, 2014 made by Sushil R. Patel, Edward R. Delorme and Guneet Bajwa in
favor of Assignor (the “Key Money Guaranty”), a true, correct and complete copy
of which is attached hereto as Exhibit A.

WHEREAS, Owner and Assignee have entered into an Operating Agreement, dated of
even date herewith.

WHEREAS, the Purchase Agreement provides, inter alia, that Assignor and Assignee
shall enter into this Assignment.

NOW, THEREFORE, in consideration of the Property, the Purchase Price and the
mutual covenants herein contained, the parties hereto hereby agree as follows:

1.    Assignment of Key Money Guaranty. Assignor hereby assigns, sets over and
transfers to Assignee all of Assignor’s right, title and interest in, to and
under the Key Money Guaranty.

2.    No Modification of Purchase Agreement. As between Assignor and Assignee,
this Agreement does not enlarge, restrict or otherwise modify the terms of the
Purchase Agreement or constitute a waiver or release by Assignor or Assignee of
any liabilities, duties or obligations imposed upon them (or any of their
respective affiliates) by the terms of the Purchase Agreement, including without
limitation the representations, warranties, covenants, agreements,
indemnifications and other provisions of the Purchase Agreement. As between
Assignor and Assignee, in the event of any conflict or inconsistency between the
terms of the Purchase Agreement and the terms hereof, the terms of the Purchase
Agreement shall govern.

3.    Limitation on Liability. This Assignment is made without any covenant,
warranty or representation by, or recourse against, Assignor, other than
Seller’s Warranties (as defined in the Purchase Agreement), to the extent
applicable. Assignor’s liability under this Assignment shall be limited as set
forth in Sections 4.5 and 7.3 of the Purchase Agreement.

 

N-1

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4.    Miscellaneous. This Assignment and the obligations of the parties
hereunder shall be binding upon and inure to the benefit of the parties hereto,
their respective legal representatives, successors and assigns, shall be
governed by and construed in accordance with the laws of the State of New York
applicable to agreements made and to be wholly performed within said State and
may not be modified or amended in any manner other than by a written agreement
signed by the party to be charged therewith.

5.    Severability. If any term or provision of this Assignment or the
application thereof to any persons or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Assignment or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby, and each term
and provision of this Assignment shall be valid and enforced to the fullest
extent permitted by law.

6.    Counterparts. This Assignment may be executed in counterparts, each of
which shall be an original and all of which counterparts taken together shall
constitute one and the same agreement and may be delivered by e-mail, pdf or
other electronic transmission.

[Remainder of page intentionally blank]

 

N-2

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IN WITNESS WHEREOF, the undersigned have executed this Assignment to be
effective as of the date first set forth hereinabove.

 

ASSIGNOR:

173ODRE9 GL OWNER, LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

N-3

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ASSIGNEE: BREIT DAVIS TRS LLC, a Delaware limited liability company By:  

 

Name:   Title:  

 

N-4

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EXHIBIT O

MANAGER SERVICE CONTRACTS

 

   

Vendor

 

Service

 

Contract Date

1   Caltronics Business Systems   Lease Agreement - Konica Minolta C308
(scanner/copier/printer/fax)   Signed by Hyatt September 14, 2016 2   Caltronics
Business Systems   Prestige Maintenance Agreement   Signed by Hyatt
September 14, 2016 3   American Society of Composers, Authors and Publishers  
License Agreement   November 19, 2015 4   Sesac LLC   License Agreement  
Effective July 1, 2014 5   Trustwave Holdings, Inc.   Agreement   Effective
March 20, 2016 6   Ecolab Pest Elimination   Pest Elimination Services Agreement
  August 9, 2016 7   Telecom Design Solutions   PBX Telephone System   March 1,
2011 8   Centrada Solutions, LLC   Master Service Agreement   Undated 9   Iron
Mountain   Customer Agreement   Effective December 1, 2015

10

 

LodgeNet Interactive Corporation

  TV Agreement   Signed by LodgeNet February 9, 2010

11

 

LodgeNet Interactive Corporation

  Free-to Guest License Agreement   Signed by LodgeNet February 26, 2010

12

 

AT&T

  Data Circuit Agreement   February 25, 2014

13

 

AT&T

  Voice Circuit Agreement   December 20, 2013

14

 

USA Today

  National Agreement   Undated

15

 

Safe Side Security

  Alarm System Services Agreement   August 17, 2011

16

 

BMI

  Music Licensing   December 12, 2016

17

 

Unigest

  Public Access Computer System Agreement   January 14, 2010

 

O - 1

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EXHIBIT P

OWNER SERVICE CONTRACTS

 

    

Vendor

  

Service

  

Contract Date

1    ThyssenKrupp Elevator    Vertical Transportation Agreement    March 1, 2010
2    Oracle America, Inc.    Agreement / POS System    Signed November 11, 2015

 

P - 1

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SCHEDULE 5.1(j)

VOUCHERS

[Separately attached.]

 

Schedule 5.1(j) - 1

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

SCHEDULE 7.2(d)

Litigation

Case No. P016-744 (slip / fall)

 

Schedule 7.2(d) - 1

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SCHEDULE 7.2(e)

Contracts

 

   

Vendor

 

Service

 

Contract Date

1   Caltronics Business Systems   Lease Agreement - Konica Minolta C308
(scanner/copier/printer/fax)   Signed by Hyatt September 14, 2016 2   Caltronics
Business Systems   Prestige Maintenance Agreement   Signed by Hyatt
September 14, 2016 3   American Society of Composers, Authors and Publishers  
License Agreement   November 19, 2015 4   Sesac LLC   License Agreement  
Effective July 1, 2014 5   ThyssenKrupp Elevator   Vertical Transportation
Agreement   March 1, 2010 6   Trustwave Holdings, Inc.   Agreement   Effective
March 20, 2016 7   Ecolab Pest Elimination   Pest Elimination Services Agreement
  August 9, 2016 8   Telecom Design Solutions   PBX Telephone System   March 1,
2011 9   Centrada Solutions, LLC   Master Service Agreement   Undated

10

 

Iron Mountain

  Customer Agreement   Effective December 1, 2015

11

 

Oracle America, Inc.

  Agreement / POS System   Signed November 11, 2015

12

 

LodgeNet Interactive Corporation

  TV Agreement   Signed by LodgeNet February 9, 2010

13

 

LodgeNet Interactive Corporation

  Free-to Guest License Agreement   Signed by LodgeNet February 26, 2010

14

 

AT&T

  Data Circuit Agreement   February 25, 2014

15

 

AT&T

  Voice Circuit Agreement   December 20, 2013

16

 

USA Today

  National Agreement   Undated

17

 

Safe Side Security

  Alarm System Services Agreement   August 17, 2011

18

 

BMI

 

Music Licensing

  December 12, 2016

19

 

Unigest

  Public Access Computer System Agreement   January 14, 2010

 

Schedule 7.2(e) - 1

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SCHEDULE 7.2(f)

Compliance with Law

None

 

Schedule 7.2(f) - 1

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

SCHEDULE 7.2(g)

Leased Personal Property

Konica Minolta C308 (scanner/copier/printer/fax)

 

Schedule 7.2(g) - 1

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SCHEDULE 7.2(r)

Licenses and Permits

 

1 ASCAP Music License

 

2 CA ABC Liquor License

 

3 Elevator Permit

 

4 Pool Restaurant Permits

 

5 SESAC Music Agreement

 

6 Sellers Permit

 

Schedule 7.2(r) - 1

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SCHEDULE 7.2(o)

Bookings

[Provided separately]

 

Schedule 7.2(o) - 1