Exhibit 10.6

RECOURSE LIABILITIES GUARANTY

FOR VALUE RECEIVED, the sufficiency of which is hereby acknowledged, the
undersigned, FELCOR LODGING TRUST INCORPORATED, a Maryland corporation,
("FLTI"), and FELCOR LODGING LIMITED PARTNERSHIP, a Delaware limited
partnership, ("FLLP"), (FLTI and FLLP, individually and collectively, as the
context requires, shall be referred to herein as the “Guarantor”) absolutely
guarantee and agree to pay to THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
(hereinafter called “Lender”) at the address designated in the Notes (defined
below)for payment thereof or as such address may be changed as provided in the
Notes, all limited and full recourse indebtedness of FelCor/CSS (SPE), L.L.C., a
Delaware limited liability company (“Borrower”) under Paragraph 7.02 of the Loan
Agreement of even date herewith between Borrower and Lender (the “Loan
Agreement”), which Loan Agreement governs a loan evidenced by one or more
promissory notes in the aggregate original principal amount of up to One Hundred
Twenty Million and No/100 Dollars ($120,000,000), each payable to the order of
Lender, and all modifications, renewals and extensions of and substitutions for
said promissory notes (said promissory notes and all modifications, renewals and
extensions thereof and all substitutions therefor hereinafter collectively, the
“Note”), together with all interest, attorneys’ fees and collection costs
provided for in Paragraph 7.02 of the Loan Agreement (all such indebtedness is
hereinafter called the “Recourse Liabilities”). Guarantor further agrees to pay
any and all costs, attorneys’ fees and expenses incurred or expended by Lender
in collecting any of the Recourse Liabilities or in enforcing any right granted
hereunder. Any capitalized term used but not otherwise defined in this Guaranty
shall have the meaning ascribed to such term in the Loan Agreement. The term
“Obligations” as used herein shall have the same meaning as such term is defined
in the Instruments.

1.         Except as otherwise limited as provided herein, in the event Borrower
fails to pay the Recourse Liabilities, Guarantor shall immediately upon written
demand of Lender promptly and with due diligence pay for the benefit of Lender
all of the Recourse Liabilities.

2.         Guarantor expressly waives presentment for payment, demand, notice of
demand and of dishonor and nonpayment of the Recourse Liabilities, notice of
intention to accelerate the maturity of the Recourse Liabilities or any part
thereof, notice of disposition of collateral, notice of acceleration of the
maturity of the Recourse Liabilities or any part thereof, protest and notice of
protest, diligence in collecting, and the bringing of suit against any other
party. Lender shall be under no obligation to notify Guarantor of its acceptance
hereof or of any advances made or credit extended on the faith hereof or the
failure of Borrower to pay any of the Recourse Liabilities as they mature or any
default in the performance of any of the Obligations under the Instrument, or to
use diligence in preserving the liability of any person on the Recourse
Liabilities or the Obligations or in bringing suit to enforce collection of the
Recourse Liabilities or performance of the Obligations. Guarantor waives all
defenses given to sureties or guarantors at law or in equity other than the
actual payment of the Recourse Liabilities and all defenses based upon questions
as to the validity, legality or enforceability of the Recourse Liabilities
and/or the Obligations and agrees that Guarantor shall be primarily liable
hereunder.

3.         Lender, without authorization from or notice to Guarantor and without
impairing, modifying, changing, releasing, limiting or affecting the liability
of Guarantor hereunder, may from time to time at its discretion and with or
without valuable consideration, alter, compromise, accelerate, renew, extend or
change the time or manner for the payment of any or all of the Recourse
Liabilities, increase or

 

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reduce the rate of interest thereon, take and surrender security, exchange
security by way of substitution, or in any way it deems necessary take, accept,
withdraw, subordinate, alter, amend, modify or eliminate security, add or
release or discharge endorsers, guarantors or other obligors, make changes of
any sort whatever in the terms of payment of the Recourse Liabilities, in the
Obligations or in the manner of doing business with Borrower, or settle or
compromise with Borrower or any other person or persons liable on the Recourse
Liabilities or the Obligations on such terms as it may see fit, and may apply
all moneys received from the Borrower or others, or from any security held
(whether held under a security instrument or not), in such manner upon the
Recourse Liabilities (whether then due or not) as it may determine to be in its
best interest, without in any way being required to marshal securities or assets
or to apply all or any part of such moneys upon any particular part of the
Recourse Liabilities. It is specifically agreed that Lender is not required to
retain, hold, protect, exercise due care with respect thereto, perfect security
interests in or otherwise assure or safeguard any security for the Recourse
Liabilities or the Obligations; no failure by Lender to do any of the foregoing
and no exercise or non-exercise by Lender of any other right or remedy of Lender
shall in any way affect any of Guarantor’s obligations hereunder or any security
furnished by Guarantor or give Guarantor any recourse against Lender.

4.         The liability of Guarantor hereunder shall not be modified, changed,
released, limited or impaired in any manner whatsoever on account of any or all
of the following: (a) the incapacity, death, disability, dissolution or
termination of Guarantor, Borrower, Lender or any other person or entity; (b)
the failure by Lender to file or enforce a claim against the estate (either in
administration, bankruptcy or other proceeding) of Borrower or any other person
or entity; (c) recovery from Borrower or any other person or entity becomes
barred by any statute of limitations or is otherwise prevented; (d) any
defenses, set-offs or counterclaims which may be available to Borrower or any
other person or entity (other than the actual payment of the Obligations);
(e) any transfer or transfers of any of the property covered by the Instrument
or any other instrument securing the payment of the Note; (f) any modifications,
extensions, amendments, consents, releases or waivers with respect to the Note,
the Instrument, any other instrument now or hereafter securing the payment of
the Note, or this Guaranty; (g) any failure of Lender to give any notice to
Guarantor of any default under the Note, the Instrument, any other instrument
securing the payment of the Note, or this Guaranty; (h) Guarantor is or becomes
liable for any indebtedness owing by Borrower to Lender other than under this
Guaranty; or (i) any impairment, modification, change, release or limitation of
the liability of, or stay of actions or lien enforcement proceedings against,
Borrower, its property, or its estate in bankruptcy resulting from the operation
of any present or future provision of the Federal Bankruptcy Code or any other
present or future federal or state insolvency, bankruptcy or similar law (all of
the foregoing hereinafter collectively called “applicable Bankruptcy Law”) or
from the decision of any court.

5.         Lender shall not be required to pursue any other remedies before
invoking the benefits of the guaranties contained herein, and specifically it
shall not be required to make demand upon or institute suit or otherwise pursue
or exhaust its remedies against Borrower or any surety other than Guarantor or
to proceed against any security now or hereafter existing for the payment of any
of the Recourse Liabilities. Lender may maintain an action on this Guaranty
without joining Borrower therein and without bringing a separate action against
Borrower.

6.         If for any reason whatsoever (including but not limited to ultra
vires, lack of authority, illegality, force majeure, act of God or
impossibility) the Recourse Liabilities or the Obligations cannot be enforced
against Borrower, such unenforceability shall in no manner affect the liability
of Guarantor hereunder and Guarantor shall be liable hereunder notwithstanding
that Borrower may not be liable for such Recourse Liabilities or such
Obligations and to the same extent as Guarantor would have been liable if such
Recourse Liabilities or Obligations had been enforceable against Borrower.

 

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7.         Guarantor absolutely and unconditionally covenants and agrees that in
the event that Borrower does not or is unable to pay the Recourse Liabilities
for any reason, including, without limitation, liquidation, dissolution,
receivership, conservatorship, insolvency, bankruptcy, assignment for the
benefit of creditors, sale of all or substantially all assets, reorganization,
arrangement, composition, or readjustment of, or other similar proceedings
affecting the status, composition, identity, existence, assets or obligations of
Borrower, or the disaffirmance or termination of any of the Recourse Liabilities
or Obligations in or as a result of any such proceeding, Guarantor shall pay the
Recourse Liabilities and no such occurrence shall in any way affect Guarantor’s
obligations hereunder.

8.         Should the status, structure or composition of Borrower change, this
Guaranty shall continue and also cover the Recourse Liabilities of Borrower
under its new status, structure or composition according to the terms hereof.
This Guaranty shall remain in full force and effect notwithstanding any transfer
of any of the property covered by the Instrument.

9.         In the event any payment by Borrower to Lender is held to constitute
a preference under any applicable Bankruptcy Law, or if for any other reason
Lender is required to refund such payment or pay the amount thereof to any other
party, such payment by Borrower to Lender shall not constitute a release of
Guarantor from any liability hereunder, but Guarantor agrees to pay such amount
to Lender upon demand and this Guaranty shall continue to be effective or shall
be reinstated, as the case may be, to the extent of any such payment or
payments.

10.       Guarantor agrees that it shall not have (a) the right to the benefit
of, or to direct the application of, any security held by Lender (including the
property covered by the Instrument and any other instrument securing the payment
of the Note), any right to enforce any remedy which Lender now has or hereafter
may have against Borrower, or any right to participate in any security now or
hereafter held by Lender, or (b) any defense arising out of the absence,
impairment or loss of any right of reimbursement or subrogation or other right
or remedy of Guarantor against Borrower or against any security resulting from
the exercise or election of any remedies by Lender (including the exercise of
the power of sale under the Instrument), or any defense arising by reason of any
disability or other defense of Borrower or by reason of the cessation, from any
cause, of the liability of Borrower.

11.       The payment by Guarantor of any amount pursuant to this Guaranty shall
not in any way entitle Guarantor to any right, title or interest (whether by way
of subrogation or otherwise) in and to any of the Recourse Liabilities or any
proceeds thereof, or any security therefor, unless and until the full amount
owing to Lender on the Recourse Liabilities has been fully paid, but when the
same has been fully paid Guarantor shall be subrogated as to any payments made
by it to the rights of Lender as against Borrower and/or any endorsers, sureties
or other guarantors.

12.       Notwithstanding any payments made by or for the account of Guarantor
on account of the Recourse Liabilities, Guarantor shall not be subrogated to any
rights of Lender until such time as Lender shall have received payment of the
full amount of all Recourse Liabilities. For the purposes of the preceding
sentence only, the Recourse Liabilities shall not be deemed to have been paid in
full by foreclosure of the Instrument or by acceptance of a deed in lieu
thereof, and Guarantor hereby waives and disclaims any interest which it might
have in the property covered by the Instrument or other collateral security for
the Recourse Liabilities and the Obligations, by subrogation or otherwise,
following foreclosure of the Instrument or Lender’s acceptance of a deed in lieu
thereof.

13.       Guarantor expressly subordinates its rights to payment of any
indebtedness owing from Borrower to Guarantor, whether now existing or arising
at any time in the future, to the prior right of Lender to receive or require
payment in full of the Recourse Liabilities and until payment in full of the
Recourse Liabilities (and including interest accruing on the Note after any
petition under applicable

 

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Bankruptcy Law, which post-petition interest Guarantor agrees shall remain a
claim that is prior and superior to any claim of Guarantor notwithstanding any
contrary practice, custom or ruling in proceedings under such applicable
Bankruptcy Law generally), Guarantor agrees not to accept any payment or
satisfaction of any kind of indebtedness of Borrower to Guarantor or any
security for such indebtedness; provided, however, that so long as no Event of
Default, or event which with the passage of time or the giving of notice, or
both, would constitute an Event of Default, has occurred under the Documents (as
such term is defined in the Instrument) this shall not apply to any
distributions made (i) to any Guarantor as the holder of an equity interest in
Borrower, (ii) in the ordinary course of Borrower’s business, and (iii) more
than twelve (12) months prior to a default under the Documents. If Guarantor
should receive any such payment, satisfaction or security for any indebtedness
of Borrower to Guarantor, Guarantor agrees forthwith to deliver the same to
Lender in the form received, endorsed or assigned as may be appropriate for
application on account of, or as security for, the Recourse Liabilities and
until so delivered, agrees to hold the same in trust for Lender.

13.       Under no circumstances shall the aggregate amount paid or agreed to be
paid hereunder exceed the highest lawful rate permitted under applicable usury
law (the “Maximum Rate”) and the payment obligations of Guarantor hereunder are
hereby limited accordingly. If under any circumstances, whether by reason of
advancement or acceleration of the unpaid principal balance of the Note or
otherwise, the aggregate amounts paid hereunder shall include amounts which by
law are deemed interest and which could exceed the Maximum Rate, Guarantor
stipulates that payment and collection of such excess amounts shall have been
and will be deemed to have been the result of a mistake on the part of both
Guarantor and Lender, and Lender shall promptly credit such excess (only to the
extent such interest payments are in excess of the Maximum Rate) against the
unpaid principal balance of the Note, and any portion of such excess payments
not capable of being so credited shall be refunded to Guarantor. The term
“applicable law” as used in this paragraph shall mean the laws of the Property
State (as such term is defined in the Instrument) is located or the laws of the
United States, whichever laws allow the greater rate of interest, as such laws
now exist or may be changed or amended or come into effect in the future.

14.       Guarantor hereby represents, warrants and covenants to and with Lender
as follows: (a) the making of the Loan by Lender to Borrower is and will be of
direct interest, benefit and advantage to Guarantor; (b) Guarantor is solvent,
is not bankrupt and has no outstanding liens, garnishments, bankruptcies or
court actions which could render Guarantor insolvent or bankrupt, and there has
not been filed by or against Guarantor a petition in bankruptcy or a petition or
answer seeking an assignment for the benefit of creditors, the appointment of a
receiver, trustee, custodian or liquidator with respect to Guarantor or any
substantial portion of Guarantor’s property, reorganization, arrangement,
rearrangement, composition, extension, liquidation or dissolution or similar
relief under applicable Bankruptcy Law; (c) all reports, financial statements
and other financial and other data which have been or may hereafter be furnished
by Guarantor to Lender in connection with this Guaranty are or shall be true and
correct in all material respects and do not and will not omit to state any fact
or circumstance necessary to make the statements contained therein not
misleading and do or shall fairly represent the financial condition of Guarantor
as of the dates and the results of Guarantor’s operations for the periods for
which the same are furnished, and no material adverse change has occurred since
the dates of such reports, statements and other data in the financial condition
of Guarantor; (d) the execution, delivery and performance of this Guaranty do
not contravene, result in the breach of or constitute a default under any
mortgage, deed of trust, lease, promissory note, loan agreement or other
contract or agreement to which Guarantor is a party or by which Guarantor or any
of its properties may be bound or affected and do not violate or contravene any
law, order, decree, rule or regulation to which Guarantor is subject; (e) there
are no judicial or administrative actions, suits or proceedings pending or, to
the best of Guarantor’s knowledge, threatened against or affecting Guarantor or
involving the validity, enforceability or priority of this Guaranty; and (f)

 

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this Guaranty constitutes the legal, valid and binding obligation of Guarantor
enforceable in accordance with its terms.

15.       If financial statements of Guarantor are not publicly available,
Guarantor will deliver to Lender, as soon as available and in no event later
than one hundred twenty (120) days after the end of Borrower’s fiscal year,
financial statements of Guarantor in scope and detail satisfactory to Lender.
The statements shall be sworn and certified as to accuracy by Guarantor.

16.       Where two or more persons or entities have executed this Guaranty,
unless the context clearly indicates otherwise, all references herein to
“Guarantor” shall mean the guarantors hereunder or either or any of them. All of
the obligations and liability of said guarantors hereunder shall be joint and
several. Suit may be brought against said guarantors, jointly and severally, or
against any one or more of them or less than all of them, without impairing the
rights of Lender against the other or others of said guarantors; and Lender may
compound with any one or more of said guarantors for such sums or sum as it may
see fit and/or release a portion of said guarantors from all further liability
to Lender for any Recourse Liabilities without impairing the right of Lender to
demand and collect the balance of such Recourse Liabilities from the other or
others of said guarantors not so compounded with or released; but it is agreed
among said guarantors themselves, however, that such compounding and release
shall in nowise impair the rights of said guarantors as among themselves.

17.       Except as otherwise provided herein, the rights of Lender are
cumulative and shall not be exhausted by its exercise of any of its rights
hereunder or otherwise against Guarantor or by any number of successive actions
until and unless all Recourse Liabilities have been paid and each of the
obligations of Guarantor hereunder has been performed.

18.       All property of Guarantor now or hereafter in the possession or
custody of or in transit to Lender for any purpose, including safekeeping,
collection or pledge, for the account of Guarantor, or as to which Guarantor may
have any right or power, shall be held by Lender subject to a lien and security
interest in favor of Lender to secure payment and performance of all obligations
and liabilities of Guarantor to Lender hereunder. Guarantor hereby transfers and
conveys to Lender any and all balances, credits, deposits, accounts, items and
moneys of Guarantor now or hereafter in the possession or control of or
otherwise with Lender. Lender is hereby granted a first lien upon, and security
interest in, all property of Guarantor of every kind or description now or
hereafter in possession or control of Lender for any purpose, including all
dividends and distributions on or other rights in connection therewith. The
balance of every account of Guarantor with, and each claim of Guarantor against,
Lender existing from time to time shall be subject to a lien and subject to set
off against any and all liabilities of Guarantor to Lender, and Lender may, at
any time and from time to time at its option and without notice, appropriate and
apply toward the payment of any of such liabilities the balance of each such
account or claim of Guarantor against Lender.

19.       Any notice or communication required or permitted hereunder shall be
given in writing, sent by (a) personal delivery, or (b) expedited delivery
service with proof of delivery, or (c) United States mail, postage prepaid,
registered or certified mail, sent to the intended addressee at the address
shown below, or to such other address or to the attention of such other person
as hereafter shall be designated in writing by the applicable party sent in
accordance herewith. Any such notice or communication shall be deemed to have
been given and received either at the time of personal delivery or, in the case
of delivery service or mail, as of the date of first attempted delivery at the
address and in the manner provided herein, or in the case of telegram, telex or
telecopy, upon receipt.

20.       This Guaranty shall be deemed to have been made under and shall be
governed by the laws of the State of New York in all respects.

 

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21.       This Guaranty may be executed in any number of counterparts with the
same effect as if all parties hereto had signed the same document. All such
counterparts shall be construed together and shall constitute one instrument,
but in making proof hereof it shall only be necessary to produce one such
counterpart.

22.       This Guaranty may only be modified, waived, altered or amended by a
written instrument or instruments executed by the party against which
enforcement of said action is asserted. Any alleged modification, waiver,
alteration or amendment which is not so documented shall not be effective as to
any party.

23.       The books and records of Lender showing the accounts between Lender
and Borrower shall be admissible in any action or proceeding hereon as prima
facie evidence of the items set forth herein.

24.       Guarantor waives and renounces any and all homestead or exemption
rights Guarantor may have under the Constitution or the laws of any state as
against Guarantor, and does transfer, convey and assign to Lender a sufficient
amount of such homestead or exemption as may be allowed, including such
homestead or exemption as may be set apart in bankruptcy, to pay the Recourse
Liabilities. Guarantor hereby directs any trustee in bankruptcy having
possession of such homestead or exemption to deliver to Lender a sufficient
amount of property or money set apart as exempt to pay the Recourse Liabilities.

25.       The terms, provisions, covenants and conditions hereof shall be
binding upon Guarantor and the heirs, devisees, representatives, successors and
assigns of Guarantor and shall inure to the benefit of Lender and all
transferees, credit participants, successors, assignees and/or endorsees of
Lender. Within this Guaranty, words of any gender shall be held and construed to
include any other gender and words in the singular number shall be held and
construed to include the plural and words in the plural number shall be held and
construed to include the singular, unless the context otherwise requires. A
determination that any provision of this Guaranty is unenforceable or invalid
shall not affect the enforceability or validity of any other provision and any
determination that the application of any provision of this Guaranty to any
person or circumstance is illegal or unenforceable shall not affect the
enforceability or validity of such provision as it may apply to any other
persons or circumstances.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the undersigned have executed this Guaranty as of the ___
day of March, 2009.

 

GUARANTOR:

FLTI:

FELCOR LODGING TRUST INCORPORATED, a Maryland corporation

 

By:

 

Name:

 

Title:

 

 

 

FLLP:

FELCOR LODGING LIMITED PARTNERSHIP, a Delaware limited partnership

 

 

By:

 

Name:

 

Title:

 

 

The address of Guarantor is:

545 E. John Carpenter Freeway, Suite 1300,

Irving, Texas 75062

 

The address of Lender is:

The Prudential Insurance Company of America

Prudential Asset Resources, Inc.

2100 Ross Avenue, Suite 2500

Dallas, Texas 75201

Attention: Vice President, Corporate Counsel

 

 

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