Exhibit 10.2

 

FRAMEWORK AGREEMENT

 

This FRAMEWORK AGREEMENT (this “Agreement”), dated as of January 12, 2017, is by
and among (i) American Realty Capital Hospitality Advisors, LLC (the “Advisor”),
(ii) American Realty Capital Hospitality Properties, LLC (the “Hospitality
Manager”), (iii) American Realty Capital Hospitality Grace Portfolio, LLC (the
“Grace Manager” and together with the Hospitality Manager, the “Property
Manager”), (iv) Crestline Hotels & Resorts, LLC (“Crestline”), (v) American
Realty Capital Hospitality Trust, Inc. (“ARCH”), (vi) American Realty Capital
Hospitality Operating Partnership, L.P. (the “OP”), (vii) American Realty
Capital Hospitality Special Limited Partnership, LLC (the “Special Limited
Partner” and together with the Advisor, the Hospitality Manager, the Grace
Manager and Crestline, the “Advisor Parties”), and (viii) solely in connection
with Sections 7(b), 7(d), 8, 9 and 10 through 22 (inclusive), Brookfield
Strategic Real Estate Partners II Hospitality REIT II, LLC, a Delaware limited
liability company and an entity that is controlled, directly or indirectly, by
Brookfield Asset Management, Inc. (the “Investor” and, together with the Advisor
Parties, ARCH and the OP, the “Parties”).

 

Reference is hereby made to (i) that certain Agreement of Limited Partnership of
the OP, dated as of January 7, 2014, as amended by that certain First Amendment
to the Agreement of Limited Partnership of the OP, dated as of August 7, 2015
and that certain Second Amendment to Agreement of Limited Partnership of the OP,
dated as of November 11, 2015 (collectively, the “OP Agreement”), (ii) that
certain Advisory Agreement, dated as of January 7, 2014, by and among ARCH, the
OP and the Advisor, as amended by that certain First Amendment to Advisory
Agreement, dated as of November 11, 2015 and that certain Second Amendment to
Advisory Agreement, dated as of March 24, 2016 (collectively, the “Advisory
Agreement”), and (iii) those certain property management agreements listed on
Exhibit A hereto (collectively, the “Property Management Agreements”).

 

W I T N E S S E T H:

 

WHEREAS, concurrently with the execution of this Agreement, the Investor, the OP
and ARCH are entering into that certain Securities Purchase, Voting and
Standstill Agreement (the “SPA”), pursuant to which, among other things, (a) the
Investor has agreed to purchase, and ARCH has agreed to sell, one (1) share of a
new series of preferred stock of ARCH, and (b) the Investor has agreed to
purchase, and the OP has agreed to sell, units of a new series of convertible
preferred operating partnership units of the OP (the transactions contemplated
by the SPA collectively referred to herein as the “Transaction”);

 

WHEREAS, as a condition precedent to the “Initial Closing” (as defined in the
SPA and referred to herein as the “Closing”), the transactions contemplated by
this Agreement (including the Advisory Agreement Amendment and the Property
Management Transactions, collectively, the “Advisor/Property Manager
Transactions”) shall be consummated effective as of the Closing;

 

WHEREAS, effective as of, and contingent upon, the Closing, the Advisor, ARCH
and the OP desire to amend the Advisory Agreement in the form set forth on
Exhibit B (the “Advisory Agreement Amendment”, and the Advisory Agreement as so
amended, the “Amended Advisory Agreement”); and

 

 

 

 

WHEREAS, effective as of, and contingent upon, the Closing, the Property
Manager, Crestline, ARCH and the OP desire (i) to assign to Crestline and amend
(including, without limitation, to add each of the properties currently covered
by the Interstate Managed Agreements set forth on Exhibit A) each of the
Property Management Agreements under the heading Crestline Managed Agreements on
Exhibit A, substantially in the form(s) set forth on Exhibit C-1 (each, as
assigned and amended, an “Amended Crestline Managed Agreement”), (ii) to
terminate each of the Property Management Agreements under the heading
Interstate Managed Agreements on Exhibit A, substantially in the form set forth
on Exhibit C-3 (each, an “Interstate Terminated Agreement”), (iii) to terminate
each of the Property Management Agreements under the heading Other Property
Management Agreements on Exhibit A, by means of a termination agreement in
substantially the form(s) set forth on Exhibit C-3 (each, an “Other Property
Management Termination Agreement” and, together with the Interstate Terminated
Agreements, the “Termination Agreements”), and (iv) to assign to the applicable
operating lessee and amend each of the Property Management Agreements under the
heading Short-Term Managed Agreements on Exhibit A, substantially in the form(s)
set forth on Exhibit C-4 (each, as assigned and amended, a “Short-Term Managed
Agreement” and the transactions contemplated by the Amended Crestline Managed
Agreements, the Termination Agreements, the Short-Term Managed Agreements and
the Amended Short-Term Prime Agreements (if any), the “Property Management
Transactions”).

 

NOW, THEREFORE, in consideration of the premises and covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as set forth herein.

 

1.           Consideration. In consideration for the entry into the Property
Management Transactions and subject to, and effective upon, the Closing, ARCH
and the OP shall:

 

(a) at the Closing, pay, or cause to be paid, solely in consideration for the
entry into the Property Management Transactions, a one-time amount in cash equal
to $10,000,000 in the aggregate to the Property Manager or its designee by wire
transfer of immediately available funds to the account designated by the
Property Manager to ARCH and the OP in writing at least three (3) business days
prior to the Closing;

 

(b) on the fifteenth (15th) day of each of the twelve (12) calendar months
following the Closing (or the next business day if such fifteenth (15th) day of
the month is not a business day), pay, or cause to be paid, solely in
consideration for the entry into the Property Management Transactions, an amount
in cash, and without interest, equal to $333,333.33 to the Property Manager or
its designee by wire transfer of immediately available funds to the account
designated by the Property Manager to ARCH and the OP in writing at least three
(3) business days prior to the applicable payment date (and if no such wire
instructions are given at least three (3) business days prior to the applicable
payment date, to the last account previously designated in writing by the
Property Manager to ARCH and the OP); provided, however, that if the Closing
occurs on or prior to the fifteenth (15th) day of a month, the first of such
twelve (12) payments shall be made on the fifteenth (15th) day in the month in
which Closing occurs;

 

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(c) at the Closing and subject to Section 7(c) hereof, issue to the Property
Manager or its designee, solely in consideration for the entry into the Property
Management Transactions, 279,329 shares of common stock, par value $0.01 per
share (the “Common Stock”) of ARCH, which number of shares of Common Stock the
Parties acknowledge and agree represents, as of the date hereof, an aggregate
value of shares of Common Stock equal to $6,000,000 at a price per share of
Common Stock equal to $21.48; provided, however, that (i) the number of shares
of Common Stock to be issued to the Property Manager or its designee pursuant to
this Section 1(c) shall be appropriately adjusted in the event that ARCH
effects, after the date hereof, any stock dividend (excluding any
payment-in-kind stock dividends paid by ARCH to its stockholders in accordance
with its past practice commencing in fiscal year 2016), stock split, combination
or other similar recapitalization at or prior to the Closing with respect to the
Common Stock (any such event, a “Recap”);

 

(d) at the Closing and solely as consideration for the entry into the Property
Management Transactions, waive any and all obligations of the Advisor to refund
or otherwise repay (including through the offset of any amounts due to the
Advisor or its affiliates) any Organization and Offering Expenses (as defined in
the Advisory Agreement) previously reimbursed to the Advisor under the Advisory
Agreement, which the Parties acknowledge and agree are equal to $5,821,988 as of
the date hereof; provided, however, that such waiver shall, subject to the
execution and delivery of the Transaction Documents by each of the Advisor
Parties party thereto, be effective as of, and contingent upon, the Closing
without any further action on the part of any person; provided further that the
Advisor (on behalf of itself and its affiliates) acknowledges and agrees that in
no event shall any Organization and Offering Expenses (including any
unreimbursed Organization and Offering Expenses that have previously been
invoiced to ARCH or any of its affiliates by the Advisor or any of its current
or former affiliates (including, ARC Advisory Services, RCS Advisory Services
and SK Research) under the Advisory Agreement) be reimbursable by ARCH, the OP
or any of their respective subsidiaries to the Advisor or any of its current or
former affiliates and, effective as of the Closing, the Advisor Parties (on
behalf of themselves and their respective affiliates) hereby waive and release
each of ARCH, the OP and their respective affiliates from any and all payments
obligations with respect to the Organization and Offering Expenses; and

 

(e) at the Closing, subject to Section 7(c) hereof, and solely as consideration
for the entry into the Property Management Transactions, (x) remove all
transfer, vesting and other restrictions on the Class B Units (as defined in the
OP Agreement) held by the Advisor or any of its affiliates as of the Closing,
(y) convert all of such Class B Units into 524,956 OP Units (as defined in the
OP Agreement), and (z) immediately following such conversion, redeem such
524,956 OP Units for 524,956 shares of Common Stock; provided, however, that the
number of shares of Common Stock to be issued to the Advisor, any of its
affiliates or other designees pursuant to this Section 1(e) shall be
appropriately adjusted in the event of a Recap, after the date hereof; provided,
further, that the transactions contemplated by the foregoing provisions of this
Section 1(e) shall, subject to the execution and delivery of the Transaction
Documents by each of the Advisor Parties party thereto, be effective as of, and
contingent upon, the Closing without any further action on the part of any
person.

 

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Notwithstanding anything contained herein to the contrary, the Parties hereby
acknowledge and agree that no consideration contemplated herein is being paid,
and no consideration shall be payable to, the Advisor, its affiliates or to any
other person in respect of the termination of the Advisory Agreement, the entry
into the Amended Advisory Agreement or the internalization of management
services provided by the Advisor.

 

2.           Certain Acknowledgements.

 

(a) The Advisor Parties, on behalf of themselves and each of their affiliates,
hereby acknowledge and agree that no amounts shall be payable to the Advisor,
the Property Manager or any of their respective affiliates in connection with
the Transaction, the Advisor/Property Manager Transactions (including, the
termination of the Advisory Agreement, the entry into the Amended Advisory
Agreement and the Property Management Transactions) or pursuant to the OP
Agreement, other than (i) as specifically provided in the Amended Advisory
Agreement and this Agreement (including in any agreement attached hereto as an
Exhibit), (ii) pursuant to any agreement entered into following the Closing
between ARCH or any of its subsidiaries, on the one hand, and any Advisor Party
or any of their respective affiliates, on the other hand, or (iii) in respect of
(x) current accounts payable owing to the Advisor by ARCH pursuant to the
Advisory Agreement as of the date hereof, net of any receivables owing by the
Advisor or any of its affiliates to ARCH or any of its subsidiaries (other than
the amounts waived pursuant to Section 1(d)), (y) all amounts, including all
fees and expense reimbursements owing to the Advisor pursuant to the Advisory
Agreement under the terms thereof prior to the Closing, net of any
reimbursements owing by the Advisor to ARCH or any of its subsidiaries prior to
the Closing (other than the amounts waived pursuant to Section 1(d)), and (z)
all amounts, including all fees and expense reimbursements owing to the Property
Manager or Crestline pursuant to any property management agreement with ARCH or
its subsidiaries (subject to any modifications or amendments contemplated by the
Property Management Transactions).

 

(b) In furtherance of, and not in limitation of, Section 2(a), the (x) Special
Limited Partner hereby acknowledges and agrees that, effective as of, and
contingent upon, the Closing (i) the Special Limited Partner Interest (as
defined in the OP Agreement) held by the Special Limited Partner, and all of the
Special Limited Partner’s right, title and interest thereto and thereunder,
shall automatically be forfeited without any further action on the part of any
person (and, at such time, the Special Limited Partner Interest will no longer
be outstanding and there shall be no rights in connection therewith), and (ii)
the OP shall be entitled to, and shall, redeem (without the payment of any
consideration to the Special Limited Partner or any of its affiliates) such
Special Limited Partner Interest, and (y) each of the Advisor Parties (on behalf
of themselves and each of their affiliates) hereby acknowledges and agrees that,
effective as of the Closing, no such person shall have any right to consent to
or otherwise object to the execution, delivery or performance of any amendment
or modification to the OP Agreement.

 

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(c) (i) Notwithstanding anything contained herein or in any of the Transaction
Documents to the contrary, each of the Parties acknowledges and agrees that all
rights of (i) the Advisor Parties and their respective affiliates and
representatives (collectively, the “Indemnitees”) to indemnification (including
in respect of events and occurrences happening before, on, or after the Closing)
by ARCH or the OP pursuant to, and accordance with, the terms of (v) ARCH’s or
the OP’s constituent documents (the “Governing Documents”), (w) the Advisory
Agreement, (x) the Property Management Agreements (solely to the extent not
covered by the continuing terms of such Property Management Agreements, as
amended or assigned, following the Closing), (y) that certain Management
Agreement, dated as of March 10, 2008, by and between BSE/AH Blacksburg Hotel,
L.L.C. and Crestline (solely to the extent not covered by the continuing terms
of such Management Agreement, as amended or assigned, following the Closing),
and (z) that certain Indemnification Agreement, made and entered into as of the
31st day of December, 2014, by and between ARCH, the Advisor, AR Capital, LLC
and the other parties thereto (the “Indemnification Agreement”), in each case
((v) through (z)), solely in respect of any claims (a “Third Party Claim”)
against the Indemnitees made by a third party (but expressly excluding the
Advisor Parties themselves and/or their current or former affiliates or
representatives and expressly including any derivative claims or actions (e.g.,
a derivative claim brought by ARCH on behalf of one or more of its
shareholders)), and (ii) ARCH, the OP and their affiliates and representatives
to indemnification (including in respect of events and occurrences happening
before, on, or after the Closing) by the Advisor Parties or any of their
respective affiliates under (x) the Advisory Agreement, (y) the Property
Management Agreements (solely to the extent not covered by the continuing terms
of such Property Management Agreements, as amended or assigned, following the
Closing), and (z) that certain Management Agreement, dated as of March 10, 2008,
by and between BSE/AH Blacksburg Hotel, L.L.C. and Crestline (solely to the
extent not covered by the continuing terms of such Management Agreement, as
amended or assigned, following the Closing), in each case ((x) through (z))
solely in respect of any claims made by a third party against ARCH, the OP or
their affiliates or representatives, in each case (clause (i) and (ii) of this
Section 2(c)(i)), shall not terminate, shall survive the consummation of the
Advisor/Property Manager Transactions and the Indemnitees and ARCH, the OP and
their affiliates and representatives, as applicable, shall continue to be
entitled to such rights to indemnification (to the extent applicable).

 

(ii)        Notwithstanding the provisions of the Indemnification Agreement or
the Governing Documents, an Indemnitee shall not admit liability, make any
settlement offer, or enter into any settlement or compromise with respect to a
Third-Party Claim without the prior written consent of ARCH and the OP, such
consent not to be unreasonably withheld.

 

(iii)       Notwithstanding the provisions of the Indemnification Agreement or
the Governing Documents, ARCH and the OP shall have the right, by giving written
notice to the Indemnitees within thirty (30) days after receipt of notice with
respect to any Third-Party Claim, to assume control of the defense of such
Third-Party Claim with a counsel of its choosing that is of nationally
recognized standing, and Indemnitees shall cooperate in good faith in such
defense; provided, however, that ARCH and the OP shall not be permitted to
control such defense if it has failed or is failing to defend in good faith the
Third Party Claim.  ARCH and the OP shall have the right to retain one (1)
counsel to represent ARCH and the OP and all Indemnitees with respect to any
Third-Party Claim; provided, however, that if Indemnitees reasonably conclude,
based upon the advice of counsel of nationally recognized standing, which
approval shall not be unreasonably withheld, that (i) there are legal defenses
available to the Indemnitees that are different from or additional to those
available to ARCH and the OP, (ii) there exists a conflict of interest between
ARCH and the OP, on the one hand, and the Indemnitees, on the other hand, or
(iii) if ARCH and the OP fail to assume the defense of such Third-Party Claim in
a timely manner, Indemnitees shall be entitled to control the defense of the
Third-Party Claim with one (1) legal counsel of Indemnitees’ choice, subject to
the prior approval of ARCH and the OP, which approval shall not be unreasonably
withheld, at the expense of ARCH and the OP.  Each of the Indemnitees, on the
one hand, and ARCH and the OP, on the other hand, shall reasonably cooperate
with each other in connection with the defense of any Third-Party Claim,
including by retaining and providing to the party controlling such defense
records and information that are reasonably relevant to such Third-Party Claim
and making available employees on a mutually convenient basis for providing
additional information and explanation of any material provided hereunder.  The
Indemnitees or ARCH and the OP, as the case may be, that is controlling such
defense shall keep the other parties reasonably advised of the status of such
Action and the defense thereof and shall consider in good faith any
recommendations made by the other parties with respect thereto. If ARCH and the
OP exercise their right to control the defense of a Third Party Claim, ARCH and
the OP shall obtain the prior written consent of the applicable Indemnitees
(such consent not to be unreasonably withheld, conditioned or delayed) before
entering into any settlement of a Third Party Claim or ceasing to defend such
Third Party Claim if, (i) pursuant to or as a result of such settlement or
cessation, injunctive or other equitable relief will be imposed against the
Indemnitees or any of their affiliates directly after giving effect to all
insurance and indemnification payments, (ii) such settlement does not expressly
and unconditionally release all applicable Indemnitees all liabilities and
obligations with respect to such claim without prejudice, or (iii) if such
settlement includes any statement as to culpability or failure to act by or on
behalf of the Indemnitees or any of their affiliates.

 

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3.           Amended Advisory Agreement.

 

(a) At, but subject to, the Closing, each of ARCH, the OP and the Advisor shall
execute and deliver to the other applicable Parties, the Advisory Agreement
Amendment; provided that, solely in the event that both (I) the Closing occurs
on or after March 31, 2017, and (II) on or prior to March 1, 2017, the
Independent Directors (as defined below) have not provided written notice to the
Advisor of their desire to extend the term of the Advisory Agreement, then (x)
the Advisory Agreement Amendment shall not be executed at the Closing, and (y)
the Advisory Agreement shall terminate on the date of Closing (provided, that,
for the avoidance of doubt, the provisions of Sections 15 (as modified by
Section 3(b)(iv) hereof and the terms of the Royalty-Free IP License), 19, 21 to
22 (inclusive, but as modified by Section 2(c) hereof), and 23 through 31
(inclusive) thereof shall survive such termination). If executed in accordance
with the prior sentence of this Section 3(a), the Advisory Agreement Amendment
shall provide, among other things, that (i) the Advisory Agreement shall
terminate on the later of (i) March 31, 2017, and (ii) the date of Closing,
unless, on or prior to March 1, 2017, the Independent Directors (the
“Independent Directors”) of the Board of Directors of ARCH (the “Board”) provide
written notice to the Advisor that such Independent Directors desire to extend
the term of the Advisory Agreement, in which case, the Advisory Agreement shall
terminate on May 31, 2017 (which term shall be extendable in accordance with the
terms of the Advisory Agreement Amendment).

 

(b) From and after the date hereof until the expiration without renewal or
earlier termination of the Advisory Agreement in accordance with its terms
(including as the Advisory Agreement may be amended by the Advisory Agreement
Amendment at the Closing), each of the Advisor Parties and their respective
affiliates hereby agree to use their respective commercially reasonable efforts
to assist ARCH and its subsidiaries to take such actions as ARCH and its
subsidiaries reasonably deem necessary to:

 

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(i)         transition to self-management, including by providing to ARCH and
its personnel (in electronic format or otherwise if unavailable in electronic
format) all documentation, books and records relating to ARCH and its
subsidiaries (including, all applicable legal files and information in the
investor data system such as investor statements, contact information, investor
marketing materials and template materials) and taking such actions as are set
forth on Schedule IV hereto; provided, however, that the Advisor Parties and
their respective affiliates shall be entitled to retain one copy of any such
documentation, books and records provided that during any such time as the
Advisor Parties or their respective affiliates retain such records, such persons
continue to hold such documentation, books and records in confidence and not
disclose such materials to any third party;

 

(ii)         effective as of, and contingent upon, the Closing, assume, in each
case, free and clear of all liens, pledges, charges, security interests or other
encumbrances of any kind all relevant hospitality accounting systems, software,
IT equipment (excluding all servers owned or leased by the Advisor or its
affiliates, but not the information contained on such servers relating to ARCH
and its subsidiaries), hospitality related third-party contracts, all office
furniture and office equipment presently exclusively used by the dedicated
individuals working on behalf of ARCH (including desks, chairs, office and
cellular phones, office and portable computers, file cabinets) and any other
related assets set forth on a mutually agreed schedule to the Asset Assignment
Agreement (as defined below). In furtherance of the foregoing provisions of this
Section 3(b)(ii), each of the Advisor and its applicable affiliates, on the one
hand, and ARCH and its applicable affiliates, on the other hand, shall execute
and deliver to the other an assignment and assumption agreement, substantially
in the form set forth on Exhibit D-1 (the “Asset Assignment Agreement”);

 

(iii)       solely in the event of a delivery by ARCH to Crestline prior to
January 31, 2017 of a written request to license such space, effective as of,
and contingent upon, the Closing, license certain office space currently
occupied by employees of the Advisor and its affiliates who provide services to
ARCH or the OP at 3950 University Drive, Fairfax, Virginia for the period of
time set forth in the Facilities Use Agreement (as defined below). In
furtherance of the foregoing provisions of this Section 3(b)(iii) and assuming
the delivery of the notice by ARCH specified herein, each of the Advisor,
Crestline and its applicable affiliates, on the one hand, and ARCH and its
applicable affiliates, on the other hand, shall execute and deliver to the other
an office license agreement, substantially in the form set forth on Exhibit D-2
(the “Facilities Use Agreement”);

 

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(iv)       for a period of 90 days following the Closing, have all rights (x)
necessary to use all company names, brands, logos and other applicable
intellectual property, including the name “ARC Hospitality” and “ARC Hospitality
Trust,” and (y) to the website (including the domain name) located at
www.archospitalityreit.com. In furtherance of the foregoing provisions of this
Section 3(b)(iv), each of the Advisor and its applicable affiliates, on the one
hand, and ARCH and its applicable affiliates, on the other hand, shall execute
and deliver to the other a royalty-free license, substantially in the form set
forth on Exhibit D-3 (the “Royalty-Free IP License”);

 

(v)        until the latest to occur of (i) the date of the Closing, (ii) the
date of expiration of the Amended Advisory Agreement without renewal thereof, or
(iii) to the extent that the Transition Services Agreement (as defined below) is
executed at or prior to the expiration of the Amended Advisory Agreement, the
date of expiration of the Transition Services Agreement, the “Trigger Date”),
have the right to hire relevant personnel of the Advisor and its affiliates set
forth on Schedule I attached hereto effective no earlier than the Closing (such
personnel for so long as he or she is providing services to the Advisor or its
affiliates, “Transition Personnel”). As used herein “Transferred Employees”
shall mean (x) any personnel employed by Crestline or its subsidiaries so hired
and (y) any personnel employed by an entity other than Crestline or its
subsidiaries so hired and who executes and delivers to the Advisor or its
applicable affiliates a waiver and release of claims in favor of the Advisor and
its affiliates in substantially the form set forth on Exhibit D-4 (provided that
such form shall be appropriately modified to the extent mutually and reasonably
agreed necessary to comply with the terms of a Transition Personnel’s employment
contract, if any); and

 

(vi)       at or prior to the Closing, obtain all consents of governmental
authorities and other third parties (x) required by ARCH or its subsidiaries to
be obtained in connection with the Closing or the consummation of the
Advisor/Property Manager Transactions, or (y) required by the Advisor Parties to
be obtained in connection with the consummation of the Advisor/Property Manager
Transactions; provided, however, that all out-of-pocket costs and expenses
payable to any third party (which third parties expressly exclude the Advisor
Parties and their affiliates and representatives) in connection with obtaining
all consents described in this Section 3(b)(vi) shall be borne by ARCH or its
subsidiaries (provided that in no event shall the Advisor Parties be entitled to
agree to any such payment, cost or expense without the prior written approval of
ARCH); provided, further, that no Advisor Party or its affiliates shall be
required to (I) undertake any obligation to a third party in exchange for any
consent or for taking any action (except that Crestline shall enter into certain
subordination agreements in favor of ARCH’s or its subsidiaries’ lenders in
connection with the Property Management Transactions in such forms as are
customary and reasonably satisfactory to Crestline and such lenders), or (II)
litigate, pursue or defend against any proceeding (including any temporary
restraining order or preliminary injunction) challenging the Transaction or the
Advisor/Property Management Transaction, in whole or in part.

 

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(c) Each of the Advisor Parties (on behalf of itself and its respective
affiliates) acknowledges and agrees that, other than as expressly provided in
the Transition Services Agreement or the Facilities Use Agreement, the
assistance to be provided in connection with the matters described in Sections
3(b)(i) through 3(b)(v) shall be without additional compensation or payment by
ARCH, the OP or any of their respective affiliates (except to the extent
mutually agreed in writing at or following the Closing).

 

(d) In furtherance of, and not in limitation of, Section (3)(b)(v), Advisor
hereby agrees as set forth on Schedule V.

 

(e) Solely in the event that the SPA is terminated in accordance with its terms
for any reason prior to the Closing, then the Advisor, ARCH and the OP each
hereby agree that the Advisory Agreement shall be automatically extended,
without any further action on the part of any person and without modification,
other than that the Advisory Agreement shall be automatically amended such that
(i) the term of the Advisory Agreement shall continue in force until March 31,
2018 (unless the SPA is terminated prior to March 31, 2017, in which case, the
term of the Advisory Agreement shall expire on the one (1)-year anniversary of
the date of termination of the SPA) (such expiration date, the “Initial Term
Expiration Date”), (ii) unless the Independent Directors or the Advisor, as the
case may be, provide at least sixty (60) days’ written notice of termination to
the other prior to Initial Term Expiration Date (which notice of termination may
be provided for any reason and which termination shall be effective as of the
Initial Term Expiration Date), then the Advisory Agreement shall automatically
renew thereafter for successive one (1)-year periods ending on the calendar day
of each year on which the Initial Expiration Date occurred, provided that, at
any time after Initial Term Expiration Date, either the Independent Directors or
the Advisor, as the case may be, shall be entitled to terminate the Advisory
Agreement by providing at least ninety (90) days’ prior written notice of
termination (which notice of termination may be provided for any reason), and
(iii) prior to Initial Term Expiration Date, the Advisory Agreement can be
terminated by ARCH or the OP only with Cause (as defined in the Advisory
Agreement) upon forty-five (45) days’ prior written notice to the Advisor. In
addition, solely in the event that (x) the Closing has not occurred on or prior
to June 1, 2017, (y) as of June 1, 2017, the SPA has not been terminated, and
(z) the Advisory Agreement has not otherwise been terminated for cause, then the
Advisory Agreement shall be automatically extended, without any further action
on the part of any person and without modification, other than that the Advisory
Agreement shall be automatically amended such that the term of the Advisory
Agreement shall continue in force until the earlier of (I) the date of Closing
(at which time the terms of Section 3(a) shall apply and the Advisory Agreement
shall either terminate or the Advisory Agreement Amendment shall be executed, as
applicable), and (II) the date of termination of the SPA (at which time the
terms of the first sentence of this Section 3(e) shall apply). ARCH hereby
acknowledges and agrees that (x) the Board has made all applicable evaluations
and determinations required to be made pursuant to Section 8.2 of the REIT
Charter with respect to this Section 3(e), (y) such evaluations and
determinations shall not be revised or amended, and (z) no further, consent,
approval or other authorization is required (pursuant to the REIT Charter or
otherwise) in connection with the matters contemplated by this Section 3(e);
provided, however, that the Parties acknowledge and agree that, notwithstanding
the foregoing, nothing shall restrict the rights of the Independent Directors,
the Board or ARCH to terminate the Advisory Agreement for cause in accordance
with the terms of the Advisory Agreement (or to make evaluations or
determinations in connection therewith).

 

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(f) The Advisor hereby agrees that, from and after the date hereof through the
Closing (or the earlier termination of this Agreement), it shall, and shall
cause its affiliates (including AR Global, LLC) to (other than as directed by
the Board): (i) incur amounts that are classified as expense reimbursements
under Section 11 of the Advisory Agreement in accordance with the terms of the
Advisory Agreement and consistent past practice, and (ii) use commercially
reasonable efforts to continue the operations of the business of ARCH and its
subsidiaries in the ordinary course of business consistent with past practice
and to comply with the terms of ARCH’s 2017 Annual Business Plan.

 

4.           Transition Services Agreement. At the written request of ARCH
(which may not be delivered after the expiration without renewal or earlier
termination of the Amended Advisory Agreement in accordance with its terms), the
Advisor, ARCH and the OP shall (subject to mutual agreement on the applicable
services to be provided, the fees payable in connection therewith (which fees
shall include a reimbursement of all costs related to Transition Personnel, and
which fees, to the extent not set forth on Exhibit F shall be reasonable and
customary for the applicable services being provided) and the term therefor,
which services, fees and term the Advisor, ARCH and the OP agree to negotiate in
good faith following the written request of ARCH) enter into one or more
short-term transition services agreement in substantially the form set forth on
Exhibit F (the “Transition Services Agreement”), pursuant to which the Advisor
or certain of its mutually agreed affiliates shall provide mutually agreed
transition services to ARCH and the OP in exchange for a mutually agreed rate of
compensation. The term of such Transition Services Agreement shall begin no
sooner than the later of (i) April 1, 2017, and (ii) the date of Closing.

 

5.           Property Management Transactions.

 

(a) Immediately prior, but subject to, the Closing, the Property Manager,
Crestline, ARCH and the OP, as applicable, shall (x) execute and deliver, or
cause to be executed and delivered, to the other applicable Parties, each of the
Amended Crestline Managed Agreements, each of the Termination Agreements, each
of the Short-Term Managed Agreements and, if required in accordance with Section
5(b), each of the Amended Short-Term Prime Agreements, and (y) consummate the
Property Management Transactions.

 

(b) Notwithstanding the requirement to execute Other Property Management
Termination Agreements and Short-Term Managed Agreements pursuant to this
Agreement, solely in the event that the Parties are unable to procure, prior to
Closing, the applicable consents and agreements from the applicable third
parties in connection with the execution and delivery of the Short-Term Managed
Agreements, then, solely in such case, in lieu of execution of an Other Property
Management Termination Agreement and a Short-Term Managed Agreement with respect
to the applicable properties for which such third party consents and agreements
could not be procured prior to Closing, the Property Manager, ARCH and the OP,
as applicable, shall execute and deliver, or cause to be executed and delivered,
to the other applicable Parties, an amendment to each of the applicable Property
Management Agreements under the heading Other Property Management Agreements on
Exhibit A, substantially in the form set forth on Exhibit C-5 (each, as amended,
an “Amended Short-Term Prime Agreement”).

 

10 

 

 

6.           Registration Rights Agreement. Immediately prior, but subject to,
the Closing, the Advisor, each of its affiliates holding Class B Units and ARCH
shall execute and deliver to the other applicable Parties, a registration rights
agreement, substantially in the form set forth on Exhibit G (the “Registration
Rights Agreement”).

 

7.           Covenants.

 

(a) Each Party shall, and shall cause its respective affiliates to use their
respective commercially reasonable efforts to (x) obtain all third-party
consents required in connection with the Advisor/Property Manager Transactions,
and (y) diligently prepare for and commence ARCH’s transition to self-management
(including, in accordance with Section 3(b)) with the brands, lenders, service
providers and other constituencies such that such transition to self-management
would occur no later than March 31, 2017. Subject to the terms and conditions of
this Agreement, each Party shall use commercially reasonable efforts to take, or
cause to be taken, all actions and to do, or cause to be done, all things
necessary, proper, advisable or desirable to consummate or implement the
Transaction and the Advisor/Property Manager Transactions, including providing
information reasonably requested by other Persons necessary for such Persons to
evaluate whether to obtain any applicable consent; provided, however, that all
out-of-pocket costs and expenses payable to any third party (which third parties
expressly exclude the Advisor Parties and their affiliates and representatives)
in connection with any action necessary, proper, advisable or desirable to
consummate or implement the Transaction (including, obtaining all required
consents shall be borne by ARCH or its subsidiaries (provided that in no event
shall the Advisor Parties be entitled to agree to any such payment, cost or
expense without the prior written approval of ARCH); provided, further, that no
Advisor Party or its affiliates shall be required to (I) undertake any
obligation to a third party in exchange for any consent or for taking any action
(except that Crestline shall enter into certain subordination agreements in
favor of ARCH’s or its subsidiaries’ lenders in connection with the Property
Management Transactions in such forms as are customary and reasonably
satisfactory to Crestline and such lenders), or (II) litigate, pursue or defend
against any proceeding (including any temporary restraining order or preliminary
injunction) challenging the Transaction or the Advisor/Property Management
Transaction, in whole or in part. Each of the Parties shall execute and deliver,
or cause their applicable affiliates to execute and deliver, as applicable, in
accordance with the terms and conditions set forth in this Agreement, the
Advisory Agreement Amendment, each of the Amended Crestline Managed Agreements,
each of the Termination Agreements, each of the Short-Term Managed Agreements,
the Amended Short-Term Prime Agreements (if any), the Transition Services
Agreement, the Mutual Waiver and Release, the Facilities Use Agreement, the
Asset Assignment Agreement, the Royalty-Free IP License, each of the Employee
Non-Competition Releases and the Registration Rights Agreement (such agreements,
collectively, the “Transaction Documents”).

 

11 

 

 

(b) The Investor hereby acknowledges and agrees (on its own behalf and on behalf
of its affiliates), that, in the event the Investor or any affiliate thereof
becomes the Class A Member (as defined in that certain Amended and Restated
Limited Liability Company Agreement of ARC Hospitality Portfolio I Holdco, LLC
and that certain Amended and Restated Limited Liability Company Agreement of ARC
Hospitality Portfolio II Holdco, LLC, each dated as of February 27, 2015, as
each may be amended, modified or supplemented from time to time (collectively,
the “Preferred Agreements”)), no right, whether contingent or then existing, to
terminate or otherwise modify the Amended Crestline Managed Agreements or the
Amended Short-Term Prime Agreements (if any) upon a Changeover Event (as defined
in the Preferred Agreements) (solely as a result of the occurrence of such
Changeover Event and/or pursuant to the Preferred Agreements) shall be
exercisable for so long as the Advisor and its affiliates are not in material
breach of this Agreement, the Amended Advisory Agreement, the Amended Crestline
Managed Agreements, the Short-Term Managed Agreements, the Amended Short-Term
Prime Agreements (if any), the Transition Services Agreement (if applicable) or
the Facilities Use Agreement (which breach has not been cured within fifteen
(15) business days following written notice thereof to the Advisor). Solely for
purposes of this Section 7(b), with respect to the Investor, the term
“affiliate” shall not include Brookfield Investment Management Inc., Brookfield
Investment Management (Canada) Inc. or any of their respective controlled
affiliates, for so long as such entity continues to represent the “public side”
of Brookfield Asset Management Inc. (“BAM”) and is separated from the “private
side” of BAM (including from the Investor) in accordance with internal policies
by an information barrier reasonably designed to prevent the unauthorized
disclosure of non-public information between the public side and private side.

 

(c) Notwithstanding anything to the contrary in this Agreement, in no event
shall any shares of Common Stock be issued to the Property Manager, the Advisor
or their respective designees under this Agreement (including, pursuant to
Sections 1(c), 1(e) or 7(e)) if such issuance would result in a violation of the
charter of ARCH (as amended from time to time in accordance with its terms, the
“REIT Charter”), including the provisions of Section 5.9 thereof; provided,
however, that, subject to the Property Manager, the Advisor or their respective
designees, as applicable, delivering a representation letter in a customary form
to the Board, ARCH shall, concurrently with the issuance of such shares of
Common Stock in accordance with this Agreement, exempt such person from the
Aggregate Share Ownership Limit (as defined in the REIT Charter) in connection
with the issuances of Common Stock contemplated by this Agreement.

 

(d) Immediately prior, but subject to, the Closing, each of the Advisor Parties
(on behalf of themselves and each of their respective affiliates), on the one
hand, and ARCH, the OP and the Investor (on behalf of themselves and each of
their respective affiliates), on the other hand, shall execute and deliver to
the other applicable Parties a general mutual waiver and release, substantially
in the form set forth on Exhibit I (the “Mutual Waiver and Release”).

 

(e) Effective as of, and contingent upon, the Closing and subject to Section
7(c) hereof, the Advisor agrees that all OP Units held by it or its applicable
affiliates shall be redeemed for an aggregate of ninety (90) shares of Common
Stock; provided, however, that the number of shares of Common Stock to be issued
to the Advisor or its applicable affiliate pursuant to this Section 7(e) shall
be appropriately adjusted in the event of a Recap after the date hereof.

 

12 

 

 

(f) ARCH and the OP (on behalf of themselves and their subsidiaries) hereby
acknowledge and agree that (x) from and after the Closing, none of them shall be
covered by, or have any rights with respect to, any director and officer
liability insurance policy sponsored or maintained by any Advisor Party or its
affiliates (except to the extent that any tail policy is procured in accordance
with the below), and (y) on or prior to the Closing, (i) ARCH and/or the OP
shall, at their sole cost and expense, obtain (to the extent not already held)
and maintain at all times for a period of six (6) years following the Closing, a
standalone primary coverage director and officer liability policy with coverage
(including in respect of ARCH, the OP, the Advisor Parties and their respective
affiliates and representatives, in each case that have been engaged in services
on behalf of ARCH or its subsidiaries)) providing for matters and events
occurring prior to the Closing and with policy coverage limitations of no less
than $20,000,000 plus $10,000,000 of Side A coverage, or (ii) if elected by ARCH
pursuant to written notice to the Advisor no later than March 1, 2017, the
Advisor Parties shall, at the sole cost and expense of ARCH and the OP, obtain
and maintain at all times for a period of six (6) years following the Closing a
tail policy providing for coverage (including in respect of ARCH, the OP, the
Advisor Parties and their respective affiliates and representatives) of matters
and events occurring prior to the Closing to the current director and officer
liability policy covering ARCH, the OP and its affiliates as of the date hereof
that is maintained by the Advisor Parties or their affiliates. The Parties
hereby agree to reasonably cooperate with each other (including, by providing
any reasonably requested information) to ensure the smooth transition and
implementation of the insurance coverage contemplated in this Section 7(f)(y).
Upon request, ARCH and the OP shall provide the applicable Advisor Parties with
certificate(s) of insurance as proof of the insurance coverage contemplated in
this Section 7(f)(y)(i) or the Advisor Parties shall provide ARCH and the OP
with certificate(s) of insurance as proof of the insurance coverage contemplated
in this Section 7(f)(y)(ii), as applicable. In addition, in the event that,
prior to the Closing, ARCH or the OP elect in their sole discretion to purchase
additional insurance in connection with their obligations to indemnify the
Indemnitees as described in Section 2(c) (which insurance shall include coverage
for the Indemnitees), the Advisor Parties shall contribute up to fifty percent
(50%) of the costs associated with obtaining such insurance; provided, however,
that the amount of such contribution shall not exceed $250,000 in the aggregate;
provided, further, that to the extent that the Advisor Parties contribute to the
cost of such insurance, the Advisor Parties shall be named as “additional
insureds” under such insurance if available for the coverage obtained. Upon
request, ARCH and the OP shall provide the applicable Advisor Parties with
certificate(s) of insurance as proof of the insurance coverage contemplated in
the immediately prior sentence.

 

8.           Crestline Right of First Refusal.

 

(a) From and after the Closing, each of Crestline and the Advisor hereby
acknowledges and agrees that, if either (i) the Advisor or any affiliate of the
Advisor (each, a “Transfer Party”) proposes to transfer, directly or indirectly,
all or substantially all of the equity securities of Crestline held by the
Transfer Parties (the “Equity Assets”) to any Person other than to the Advisor,
Barceló Crestline Corporation or any of their respective affiliates (the
“Acquiror”), or (ii) Crestline or any of its subsidiaries proposes to transfer
all or a substantial portion of the assets of Crestline or any of its
subsidiaries (the “Crestline Assets”) to any Acquiror (an “Asset Transfer”), in
each case, pursuant to a bona fide third party offer, in single transaction or a
series of related transactions, whether by sale, amalgamation, merger,
recapitalization, reorganization or other similar business combination (a
“Crestline Sale”), such Transfer Party or Crestline (in the case of an Asset
Transfer) shall deliver to each of ARCH and the Investor written notice (the
“ROFR Transfer Notice”) stating the proposed material terms of such Crestline
Sale, including the name and contact information of the Acquiror, the Equity
Assets or the Crestline Assets to be sold and the amount and form of
consideration offered by the Acquiror (the “Offer Price”).

 

13 

 

 

(b) Upon receipt of a ROFR Transfer Notice, each of ARCH and the Investor shall,
on the terms and subject to the conditions of this Section 8, have the right to
elect to purchase at the Offer Price and on the other terms and conditions
specified in the ROFR Transfer Notice, the Equity Assets or the Crestline
Assets, as applicable; provided that, in the event that the Investor elects to
exercise such rights, then ARCH’s election shall be of no force or effect. The
rights of the Investor pursuant to this Section 8(b) shall be exercisable by the
delivery of notice to the applicable Transfer Party (the “Notice of Exercise”),
within ten (10) calendar days from the date of receipt of the ROFR Transfer
Notice (the “Option Period”). The rights of ARCH and the Investor pursuant to
this Section 8(b) shall terminate if unexercised prior to the expiration of the
Option Period. The delivery of a ROFR Transfer Notice and of a Notice of
Exercise shall be irrevocable.

 

(c) In the event that ARCH or the Investor exercises its right to purchase the
Equity Assets or the Crestline Assets, as applicable, then the applicable
Transfer Party or Crestline must sell such Equity Assets or Crestline Assets to
ARCH or the Investor, as applicable, and ARCH or the Investor (as applicable),
on the one hand, and the applicable Transfer Party or Crestline, on the other
hand, shall exclusively negotiate in good faith the terms of definitive purchase
agreement on customary terms to purchase such Equity Assets or Crestline Assets
at the Offer Price and on the other terms and conditions specified in the ROFR
Transfer Notice, in each case, within thirty (30) calendar days after the end of
the Option Period.  Following the entry into such a definitive purchase
agreement, the parties thereto shall consummate the purchase thereunder as
promptly as practicable, but in any case within a time period of up to ninety
(90) calendar days; provided that either the Transfer Party or Crestline, on the
one hand, or ARCH or the Investor, on the other hand, shall be entitled to
extend such ninety (90)-calendar period by up to an additional sixty (60)
calendar days to the extent necessary to obtain any applicable third party
approvals, permissions, authorizations or similar consents in connection with
such transaction (provided, that, to the extent that the Transfer Party or
Crestline, as applicable, has not exercised its commercially reasonable efforts
to obtain such approvals, authorizations, permissions or similar consents, ARCH
or the Investor, as applicable, shall have the right to further extend such time
period). At the consummation of any such purchase and sale, all parties to such
purchase and sale shall execute such additional documents as are otherwise
necessary to consummate such transaction.

 

(d) If either:

 

(x) neither ARCH nor the Investor exercises its option to purchase the Equity
Assets or the Crestline Assets, as applicable; or

 

14 

 

 

(y) ARCH or the Investor validly exercises such option and (I) a definitive
purchase agreement is not executed within the thirty (30) calendar day period
provided in Section 8(c) or (II) the consummation of the purchase does not occur
within the period provided in Section 8(c) (including any extension of such time
period as provided therein);

 

then the applicable Transfer Party or Crestline, as applicable, shall have the
right, for a period of two hundred ten (210) calendar days (provided that,
solely in the event that such Transfer Party or Crestline has signed a
definitive agreement with respect to such transaction, such Transfer Party or
Crestline, as applicable, shall be entitled to extend such two hundred ten (210)
calendar day period by up to an additional sixty (60) calendar days to the
extent necessary to obtain any applicable approvals, permissions, authorizations
or similar consents in connection with such transaction (but only for so long as
Crestline or the applicable Transfer Party are using its commercially reasonable
efforts to obtain such consents)) from (A) in the case of clause (x) of this
Section 8(d) the earlier of (i) the expiration of the Option Period with respect
to such ROFR Transfer Notice or (ii) the date on which such Transfer Party
receives written notice from ARCH and the Investor that each of them will not
exercise the option granted pursuant to Section 8, or (B) in the case of clause
(y) of this Section 8(d) the end of (1) the thirty (30) calendar day period for
negotiation of a definitive agreement if such definitive agreement is not
executed within such thirty (30) calendar period, and (2) the period provided in
Section 8(c) (including any extension of such time period as provided therein)
in the event that a definitive agreement is executed within the thirty (30)
calendar day negotiation period, to sell the applicable Equity Assets or
Crestline Assets set forth in the ROFR Transfer Notice to any person at a price
of not less than the Offer Price, and otherwise on terms and conditions no more
favorable to such person, in the aggregate, than those specified in the ROFR
Transfer Notice. If such sale is consummated within such two hundred ten (210)
calendar day period (subject to the sixty (60) calendar day extension set forth
above, if applicable, to obtain consents), then the rights of ARCH and the
Investor pursuant to this Section 8 shall terminate with respect to the
applicable Equity Assets or Crestline Assets sold. If such sale is not
consummated within such two hundred ten (210) calendar day period (subject to
the sixty (60) calendar day extension set forth above, if applicable, to obtain
consents) for any reason, then the restrictions provided for herein shall again
become effective, and thereafter neither any Transfer Party nor Crestline, as
applicable, may consummate a Crestline Sale without again offering the same to
ARCH and the Investor in accordance with this Section 8, except, in each case,
in the event that (1) neither ARCH nor the Investor exercised its option to
purchase the applicable Equity Assets or Crestline Assets to be sold or (2) ARCH
or the Investor exercised the option to purchase the applicable Equity Assets or
Crestline Assets and a definitive agreement was executed in connection with such
exercise but the applicable acquisition was never consummated solely as a result
of a default in the obligation to consummate the acquisition under such
definitive agreement by ARCH or the Investor, as applicable, in accordance with
the terms of such definitive agreement.

 

(e) Each of ARCH, the OP and the Investor hereby acknowledge and agree that,
subject to compliance with the terms and conditions described in this Section 8
and any applicable terms of the Amended Crestline Managed Agreements, no consent
of ARCH, the OP, the Investor or any of their respective board of directors or
similar governing body shall be required for Crestline or its equityholders to
sell, transfer, assign or otherwise dispose of, directly or indirectly, any of
the equity interests in, or assets of, Crestline.

 

15 

 

 

9.           Representations and Warranties.

 

(a) Each of ARCH, the OP and the Investor hereby, severally (and not jointly),
represents and warrants to the Advisor Parties, solely as to itself, as of the
date hereof and as of the Closing, as follows:

 

(i)         Existence and Power. ARCH is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of Maryland
and has all power and authority required to carry on its business as now
conducted. The OP is a limited partnership duly formed, validly existing and in
good standing under the laws of the State of Delaware and has all power and
authority to carry on its business as now conducted. The Investor is a limited
liability company duly formed, validly existing and in good standing under the
laws of the State of Delaware and has all power and authority to carry on its
business as now conducted.

 

(ii)        Authorization. It and each of its applicable subsidiaries, has all
requisite corporate or similar power, authority and legal capacity to execute
and delivery, as applicable, this Agreement and each of the other Transaction
Documents to which such person(s) are party, to the perform its obligations
hereunder and thereunder and to consummate the Advisor/Property Manager
Transactions to which such person is a party. The execution, delivery and
performance of this Agreement and each of the other Transaction Documents to
which it or any of its subsidiaries are party have been duly approved by all
requisite action on it and its applicable subsidiaries’ parts. This Agreement
has been, and the other Transaction Documents to which it or any of its
respective subsidiaries is a party will be, executed and delivered by it or such
subsidiary, as applicable, and, assuming the due authorization, execution and
delivery by the other parties hereto and thereto, constitutes or will constitute
a legal, valid and binding obligation of it and such applicable subsidiaries,
enforceable against each such person in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, moratorium and similar laws of general
application relating to or affecting creditors’ rights and to general equity
principles (the “Equitable Exceptions”).

 

(iii)       Non-Contravention. The execution, delivery and performance by it of
this Agreement and by it or any of its subsidiaries of the other Transaction
Documents to which such person(s) are party does not and will not, directly or
indirectly, (a) violate, contravene or conflict with any provision of the
organizational documents of such person, (b) contravene or conflict with, or
constitute a violation of, any applicable order or provisions of any applicable
law binding upon or applicable to any such person, (c) except as set forth on
Schedule II attached hereto and any applicable filings with the Securities and
Exchange Commission, require it or any of its respective subsidiaries to make or
obtain any registration, filing, application, notice, consent, approval, order,
qualification, authorization, designation, declaration or waiver with, to or
from any governmental authority or any other person, or (d) except as set forth
on Schedule II attached hereto, require a consent, approval or waiver from, or
notice to, any party to any contract to which it or any of its respective
subsidiaries is a party, except, in the case of clauses (b), (c) and (d), for
any such violation, contravention, conflict, requirement, consent, approval or
waiver that would not be reasonably expected, individually or in the aggregate,
to have a material adverse effect on it or any of its respective subsidiaries’
ability to consummate the Advisor/Property Manager Transactions on the terms and
conditions set forth in this Agreement and the other Transaction Documents.

 

(b) ARCH hereby represents and warrants to each of the Advisor Parties who
receives shares of Common Stock pursuant to the Advisor/Property Manager
Transactions, as of the date hereof, as of the Closing and as of the date any
such shares are issued, that such shares of Common Stock, when issued, sold and
delivered in accordance with the terms and for the consideration set forth in
this Agreement, will be validly issued, fully paid and nonassessable and free of
restrictions on transfer other than restrictions on transfer under the REIT
Charter and applicable federal and state securities laws.

 

16 

 

 

(c) Each of the Advisor Parties hereby, jointly and severally, represents and
warrants to ARCH, the OP and the Investor, as of the date hereof and as of the
Closing, as follows:

 

(i)         Existence and Power. Each of the Advisor Parties is a limited
liability company duly formed, validly existing and in good standing under the
laws of the State of Delaware and has all power and authority required to carry
on its business as now conducted.

 

(ii)        Authorization. It and each of its applicable subsidiaries, has all
requisite corporate or similar power, authority and legal capacity to execute
and delivery, as applicable, this Agreement and each of the other Transaction
Documents to which such person(s) are party, to the perform its obligations
hereunder and thereunder and to consummate the Advisor/Property Manager
Transactions to which such person is a party. The execution, delivery and
performance of this Agreement and each of the other Transaction Documents to
which it or any of its affiliates (other than ARCH, the OP and their respective
subsidiaries) are party have been duly approved by all requisite action on it
and its applicable subsidiaries’ parts. This Agreement has been, and the other
Transaction Documents to which it or any of its respective affiliates (other
than ARCH, the OP and their respective subsidiaries) is a party will be,
executed and delivered by it or such affiliate, as applicable, and, assuming the
due authorization, execution and delivery by the other parties hereto and
thereto, constitutes or will constitute a legal, valid and binding obligation of
it and such applicable subsidiaries, enforceable against each such person in
accordance with its terms, subject to the Equitable Exceptions.

 

(iii)       Non-Contravention. The execution, delivery and performance by it of
this Agreement and by it or any of its affiliates (other than ARCH, the OP and
their respective subsidiaries) of the other Transaction Documents to which such
person(s) are party does not and will not, directly or indirectly, (a) violate,
contravene or conflict with any provision of the organizational documents of
such person, (b) contravene or conflict with, or constitute a violation of, any
applicable order or provisions of any applicable law binding upon or applicable
to any such person, (c) except as set forth on Schedule III attached hereto,
require it or any of its respective subsidiaries to make or obtain any
registration, filing, application, notice, consent, approval, order,
qualification, authorization, designation, declaration or waiver with, to or
from any governmental authority or any other person, or (d) except as set forth
on Schedule III attached hereto, require a consent, approval or waiver from, or
notice to, any party to any contract to which it or any of its respective
affiliates (other than ARCH, the OP and their respective subsidiaries) is a
party, except, in the case of clauses (b), (c) and (d), for any such violation,
contravention, conflict, requirement, consent, approval or waiver that would not
be reasonably expected, individually or in the aggregate, to have a material
adverse effect on it or any of its respective affiliates’ (other than ARCH, the
OP and their respective subsidiaries) ability to consummate the Advisor/Property
Manager Transactions on the terms and conditions set forth in this Agreement and
the other Transaction Documents.

 

17 

 

 

(iv)       Claims. Except as disclosed in writing by ARCH or the OP in the SPA
(including any schedules, annexes, attachments or exhibits thereto), there are
no Third Party Claims pending (or threatened in writing) against any Advisor
Party as of the date hereof for which any such Advisor Party would be entitled
to indemnification in accordance with Section 2(c).

 

(d) Each of the Advisor Parties who receives shares of Common Stock pursuant to
the Advisor/Property Manager Transactions, hereby represents and warrants to
ARCH, as of the date hereof and as of the Closing, as follows:

 

(i)         Such person is (i) an “accredited investor” within the meaning of
Rule 501 of Regulation D promulgated under the Securities Act of 1933, as
amended (the “Securities Act”); (ii) aware that the issuance and/or sale of
shares of Common Stock hereunder (collectively, the “Securities”) is being made
in reliance on a private placement exemption from registration under the
Securities Act; and (iii) acquiring the Securities for its own account.

 

(ii)        Each such person understands and agrees that the Securities are
being offered in a transaction not involving any public offering within the
meaning of the Securities Act, that such Securities have not been and, except as
contemplated by the registration rights provided for in the Registration Rights
Agreement, will not be registered under the Securities Act and that such
Securities may be offered, resold, pledged or otherwise transferred only (w) in
a transaction not involving a public offering, (x) pursuant to an exemption from
registration under the Securities Act provided by Rule 144 thereunder (if
available), (y) pursuant to an effective registration statement under the
Securities Act or (z) to ARCH or one of its subsidiaries, in each of cases (w)
through (z) in accordance with any applicable state and federal securities laws,
and that it will notify any subsequent purchaser of Securities from it of the
resale restrictions referred to above, as applicable.

 

(iii)       Each such person understands that, unless sold pursuant to a
registration statement that has been declared effective under the Securities Act
or in compliance with Rule 144 thereunder, each of ARCH and the OP may require
that the Securities will bear a legend or other restriction substantially to the
following effect (it being agreed that if the Securities are not certificated,
other appropriate restrictions shall be implemented to give effect to the
following):

 

“THIS SECURITY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, (THE “SECURITIES
ACT”), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. THE
HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY AND OPCO THAT (A)
THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I)
IN A TRANSACTION NOT INVOLVING A PUBLIC OFFERING, (II) PURSUANT TO ANY OTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, INCLUDING
RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), (III) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (IV) TO AMERICAN REALTY
CAPITAL HOSPITALITY TRUST, INC. OR ANY OF ITS SUBSIDIARIES, IN EACH OF CASES (I)
THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES, AND (B) THE HOLDER WILL NOTIFY ANY SUBSEQUENT PURCHASER OF
THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.”

 

18 

 

 

(iv)       Each such person: (w) has such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and risks of its
prospective investment in the Securities, and (x) has the ability to bear the
economic risks of its prospective investment and can afford the complete loss of
such investment.

 

(v)        Except for this Agreement, neither the Advisor, the Special Limited
Partner nor any of their respective affiliates is a party to any option,
warrant, right, contract, call, pledge, put or other agreement or commitment
providing for the disposition or acquisition of any shares of Common Stock, OP
Units, Class B Units, Special Limited Partner Interests or other equity
interests in ARCH, the OP or any of their respective subsidiaries. Neither the
Advisor, the Special Limited Partner nor any of their respective affiliates is a
party to any voting trust, proxy or other agreement or understanding with
respect to, restricting or otherwise relating to the voting or dividend rights
in respect of any shares of Common Stock, OP Units, Class B Units, Special
Limited Partner Interests or other equity interests in ARCH, the OP or any of
their respective subsidiaries. No Person has any rights to or claims against the
Class B Units or OP Units held by the Advisor or the Special Limited Partner
Interests held by the Special Limited Partner. At the Closing, (x) the Class B
Units, the OP Units and the Special Limited Partner Interests held by the
Advisor, the Special Limited Partner or the applicable affiliate of the Advisor
or Special Limited Partner, as applicable, shall be free and clear of all liens,
pledges, charges, security interests or other encumbrances of any kind, (y) all
rights, title and interest of the Advisor, the Special Limited Partner or the
applicable affiliate of the Advisor or Special Limited Partner, as applicable,
in and to the Class B Units, the OP Units and the Special Limited Partner
Interests shall be redeemed or forfeited, as applicable, pursuant to the terms
of this Agreement, and (z) the Advisor, the Special Limited Partner or the
applicable affiliate of the Advisor or Special Limited Partner, as applicable,
will cease to be a limited partner of the OP simultaneously with the Closing.

 

10.         Termination; Exclusivity.

 

(a)         This Agreement shall automatically terminate, and no party shall
have any rights or obligations hereunder and this Agreement shall become null
and void and have no further force or effect with no liability on the party of
any party hereto upon the termination of the SPA in accordance with its terms
prior to the Closing; provided, however, that Section 3(e) and Sections 10-22
(inclusive) shall survive any such termination; provided, further, that nothing
in this Section 10 shall relieve any Party of liability for breach of this
Agreement prior to the termination hereof pursuant to this Section 10.

 

19 

 

 

(b)       In consideration of the expenditure of time, effort and expense to be
undertaken by the Investor and ARCH, each of the Advisor Parties hereby agrees
that until the Closing or the earlier termination of this Agreement in
accordance with Section 10(a) (the “Exclusivity Period”), it shall not (except
to the extent any of the following shall involve Crestline (including, the 60%
interest held therein by an affiliate of Advisor and Property Manager), provided
that any such transaction involving Crestline or such 60% interest therein shall
recognize and give effect to the terms set forth in this Agreement), and shall
direct its subsidiaries and affiliates not to, directly or indirectly, (i)
solicit, initiate, engage or participate in any discussions or negotiations with
respect to any acquisition, amalgamation, merger, recapitalization,
reorganization or other business combination involving the Advisor, the Special
Limited Partner, the Property Manager or any of their respective subsidiaries or
any purchase of all or a substantial portion of the assets and/or equity
securities of the Advisor, the Property Manager, the Special Limited Partner or
any their respective subsidiaries or any other transaction that would be
inconsistent with the successful completion of the Transaction or the
Advisor/Property Manager Transactions (such matters, a “Competing Transaction”),
(ii) enter into any agreement, arrangement or understanding relating to any
potential Competing Transaction with any person or entity (including any
sub-manager of any property sub-management agreement), or (iii) take any action
to encourage or facilitate the foregoing or the making of any proposals or
inquiries that may reasonably be expected to lead to a Competing Transaction or
may inhibit the ability of the Parties to consummate the Advisor/Property
Manager Transactions.

 

(c)        In consideration of the expenditure of time, effort and expense to be
undertaken by the Advisor Parties, each of the Investor, ARCH and the OP hereby
agrees that during the Exclusivity Period, it shall not and shall direct its
subsidiaries and representatives not to, directly or indirectly, (i) take any
action or encourage or facilitate the making of any proposals or inquiries with
the primary intent or primary purpose of preventing the payment of any
consideration due to the Advisor Parties hereunder or in any Transaction
Document or (ii) exercise any right to terminate the Advisory Agreement or any
agreement set forth on Exhibit A hereto without cause.

 

11.         Counterparts. This Agreement may be executed in counterparts
(including by facsimile or other electronic transmission), each one of which
shall be deemed an original and all of which together shall constitute one and
the same Agreement.

 

12.         Governing Law; Specific Performance; WAIVER OF JURY TRIAL.

 

(a) This Agreement shall be governed by, interpreted under, and construed and
enforced in accordance with, the Law of the State of New York, not taking into
account any rules of conflicts of laws that would cause the application of the
laws of any other jurisdiction, and the Parties hereby consent to the
jurisdiction of the courts located in New York, New York.

 

(b) The parties hereto agree that irreparable damage would occur if any
provision of this Agreement were not performed in accordance with the terms
hereof and that the parties shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement or to enforce specifically the performance of
the terms and provisions hereof, without the need to post any bond or other
security, in the United States District Court for the Southern District of New
York or any New York State court sitting in New York City, in addition to any
other remedy to which they are entitled at law or in equity.

 

20 

 

 

(c)        WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT.

 

13.         Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.

 

14.         Further Assurances. Each Party shall execute and deliver such
additional documents, certificates, agreements and writings and take such other
actions as may be reasonably requested by any other Party to consummate the
Advisor/Property Manager Transactions.

 

15.         Parties in Interest. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights in any person not a party to
this Agreement. Without limiting the generality of the foregoing, no provision
of this Agreement shall create any third party beneficiary rights in any current
or former employee (including, any beneficiary or dependent thereof) of any
Advisor Party or its respective affiliates (including any Transition Personnel)
in respect of continued employment by the Advisor Party or any affiliates
thereof or otherwise.

 

16.         Entire Agreement. This Agreement constitutes the entire agreement
and understanding among the Parties in respect of the subject matter hereof and
thereof and supersedes all prior and contemporaneous arrangements, agreements
and understandings, both oral and written, whether in term sheets, presentations
or otherwise among the Parties, or between any of them, with respect to the
subject matter hereof and thereof.

 

17.         Headings. The headings and captions herein are inserted for
convenience of reference only and are not intended to govern, limit or aid in
the construction of any term or provision hereof.

 

18.         Expenses. Except as specifically set forth herein, each Party will
bear its own costs and expenses in connection with this Agreement, including all
fees and expenses of its representatives and advisors, whether or not the
Closing is not consummated.

 

21 

 

 

19.         Construction. As used in this Agreement, any reference to the
masculine, feminine or neuter gender shall include all genders, the plural shall
include the singular, and the singular shall include the plural. Unless the
context otherwise requires, the term “party” when used in this Agreement means a
Party to this Agreement. References in this Agreement to a Party or other Person
include their respective successors and assigns. The words “include,” “includes”
and “including” when used in this Agreement shall be deemed to be followed by
the phrase “without limitation” unless such phrase otherwise appears. Unless the
context otherwise requires, references in this Agreement to Sections, Exhibits
and Schedules shall be deemed references to Sections of, and Exhibits and
Schedules to, this Agreement. Unless the context otherwise requires, the words
“hereof,” “hereby” and “herein” and words of similar meaning when used in this
Agreement refer to this Agreement in its entirety and not to any particular
Section or provision hereof. Except when used together with the word “either” or
otherwise for the purpose of identifying mutually exclusive alternatives, the
term “or” has the inclusive meaning represented by the phrase “and/or”. With
regard to each and every term and condition of this Agreement, the Parties
understand and agree that the same have or has been mutually negotiated,
prepared and drafted, and that if at any time the Parties desire or are required
to interpret or construe any such term or condition or any agreement or
instrument subject thereto, no consideration shall be given to the issue of
which Party actually prepared, drafted or requested any term or condition of
this Agreement. All references in this Agreement to “dollars” or “$” shall mean
United States dollars. Any period of time hereunder ending on a day that is not
a business day shall be extended to the next business day (with the term
“business day” meaning any day, other than a Saturday, Sunday or other day on
which commercial banks in New York, New York are authorized or required by law
to close). Notwithstanding anything to the contrary, with respect to the
Investor, the term “affiliate” as used in this Agreement shall not include ARCH
or any of its subsidiaries.

 

20.         Assignment. No Party may assign, delegate or otherwise transfer,
directly or indirectly, in whole or in part, any of its rights or obligations
under this Agreement without the prior written consent of the relevant other
Parties, except that (a) the Investor shall be entitled to assign its rights
under this Agreement to any of its affiliates, and (b) so long as such transfer
or assignment would not violate any agreement to which ARCH or any of its
subsidiaries is a party (or otherwise require the consent of ARCH or its
subsidiaries under any such other agreement), the Advisor Parties shall be
entitled to (x) assign their rights to any cash consideration payable hereunder
to any of their respective affiliates (provided that no such assignment by the
Advisor Parties shall relieve the Advisor Parties of their duties and
obligations hereunder), or (y) transfer the equity interests thereof to any of
their respective affiliates (excluding any real estate investment trust (or any
of such real estate investment trust’s subsidiaries) that is an affiliate of any
of the Advisor Parties). Any attempted assignment, delegation or transfer in
violation of this Section 20 shall be void.

 

21.         Certain Additional Acknowledgments. For purposes of clarity, each of
the Parties acknowledges and agrees that (a) in no event shall the Investor have
any payment obligation (on behalf of ARCH, the OP or otherwise) in connection
with the consideration to be paid under this Agreement or the Advisor/Property
Manager Transactions (except to the extent of the exercise of any acquisition
rights by the Investor pursuant to Section 8), and (b) Investor’s payment
obligations in connection with the Transaction shall solely be governed by the
terms and conditions set forth in the SPA.

 

22.         Amendments and Waivers.

 

(a) This Agreement may only be amended by execution of a writing signed on
behalf of each of the Parties.

 

22 

 

 

(b) No failure or delay by any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.

 

[Remainder of page intentionally left blank]

 

23 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first written above.

 

  AMERICAN REALTY CAPITAL HOSPITALITY ADVISORS, LLC       By: American Realty
Capital Hospitality Special Limited Partnership, LLC, its sole member       By:
American Realty Capital IX, LLC, its sole member       By: AR Capital, LLC, its
sole member       By: /s/ Edward M. Weil, Jr.   Name:      Edward M. Weil, Jr.  
Title:      Chief Executive Officer       AMERICAN REALTY CAPITAL HOSPITALITY
PROPERTIES, LLC       By: American Realty Capital Hospitality Special Limited
Partnership, LLC, its managing member       By: American Realty Capital IX, LLC,
its sole member       By: AR Capital, LLC, its sole member       By: /s/ Edward
M. Weil, Jr.   Name:      Edward M. Weil, Jr.   Title:      Chief Executive
Officer

 

Signature page to Framework Agreement

 

 

 

 

  AMERICAN REALTY CAPITAL HOSPITALITY GRACE PORTFOLIO, LLC       By: American
Realty Capital Hospitality Properties, LLC, its sole member       By: American
Realty Capital Hospitality Special Limited Partnership, LLC, its managing member
      By: American Realty Capital IX, LLC, its sole member       By: AR Capital,
LLC, its sole member       By: /s/ Edward M. Weil, Jr.   Name:      Edward M.
Weil, Jr.   Title:      Chief Executive Officer         AMERICAN REALTY CAPITAL
HOSPITALITY SPECIAL LIMITED PARTNERSHIP, LLC       By: American Realty Capital
IX, LLC, its sole member       By: AR Capital, LLC, its sole member         By:
/s/ Edward M. Weil, Jr.   Name:      Edward M. Weil, Jr.   Title:      Chief
Executive Officer         CRESTLINE HOTELS & RESORTS, LLC         By: /s/ James
A. Carroll   Name:      James A. Carroll   Title:      Chief Executive Officer

 

Signature page to Framework Agreement

 

 

 

 

  AMERICAN REALTY CAPITAL HOSPITALITY TRUST, INC.         By: /s/ Jonathan P.
Mehlman   Name:      Jonathan P. Mehlman   Title:      President and Chief
Executive Officer         AMERICAN REALTY CAPITAL HOSPITALITY OPERATING
PARTNERSHIP, L.P.         By: American Realty Capital Hospitality Trust, Inc.,
its general partner         By: /s/ Jonathan P. Mehlman   Name:      Jonathan P.
Mehlman   Title:      President and Chief Executive Officer

 

Signature page to Framework Agreement

 

 

 

 

  BROOKFIELD STRATEGIC REAL ESTATE PARTNERS II HOSPITALITY REIT II, LLC        
By: /s/ Murray Goldfarb   Name:      Murray Goldfarb   Title:      Managing
Partner

 

Signature page to Framework Agreement

 

 

 

 

Exhibit A

 

Property Management Agreements

 

[see attached]

 

 

 

 

EXHIBIT A

 

Property Management Agreements

 

Crestline Managed Agreements     1. Second Amended and Restated Management
Agreement effective as of February 1, 2016, by and among ARC Hospitality
Portfolio I TRS, LLC, ARC Hospitality Portfolio I NTC TRS, LP, ARC Hospitality
Portfolio I MISC TRS, LLC and American Realty Capital Hospitality Grace
Portfolio, LLC, as amended by that certain First Amendment to Second Amended and
Restated Management Agreement effective as of October 13, 2016, by and among ARC
Hospitality Portfolio I TRS, LLC, ARC Hospitality Portfolio I NTC TRS, LP, ARC
Hospitality Portfolio I MISC TRS, LLC and American Realty Capital Hospitality
Grace Portfolio, LLC (31 Hotels)     2. Amended and Restated Management
Agreement effective as of September 1, 2015, by and among ARC Hospitality
Portfolio II NTC TRS, LP, ARC Hospitality Portfolio II TRS, LLC, ARC Hospitality
Portfolio II MISC TRS, LLC and American Realty Capital Hospitality Grace
Portfolio, LLC (10 Hotels)     3. Management Agreement effective as of February
27, 2015, by and between ARC Hospitality Portfolio I DEKS TRS, LLC and American
Realty Capital Hospitality Grace Portfolio, LLC (Kansas – 1 Hotel)     4. F&B
Management Agreement effective as of February 27, 2015, by and between ARC
Hospitality Portfolio I KS TRS, LLC and American Realty Capital Hospitality
Grace Portfolio, LLC (Kansas- 1 Hotel)     5. Management Agreement effective as
of February 27, 2015, by and between ARC Hospitality Portfolio I TRS, LLC and
American Realty Capital Hospitality Grace Portfolio, LLC (Ohio – 2 Hotels)    
6. Management Agreement effective as of February 27, 2015, by and between ARC
Hospitality Portfolio I NTC TRS, LP and American Realty Capital Hospitality
Grace Portfolio, LLC (Texas - 5 Hotels)     7. Management Agreement effective as
of February 27, 2015, by and between ARC Hospitality Portfolio II NTC TRS, LP
and American Realty Capital Hospitality Grace Portfolio, LLC (Texas - 1 Hotel)  
  8. Management Agreement effective as of October 15, 2015, by and among ARC
Hospitality SWN TRS, LLC, ARC Hospitality SWN CRS NTC TRS, LP and American
Realty Capital Hospitality Properties, LLC (15 Hotels)     9. Management
Agreement effective as of January 27, 2014, by and between ARC Hospitality TRS
Baltimore, LLC and American Realty Capital Hospitality Properties, LLC
(Courtyard Baltimore)

 

 

 

 

10. Management Agreement effective as of January 27, 2014, by and between ARC
Hospitality TRS Providence, LLC and American Realty Capital Hospitality
Properties, LLC (Courtyard Providence)     11. Management Agreement effective as
of January 27, 2014, by and between ARC Hospitality TRS GA Tech, LLC and
American Realty Capital Hospitality Properties, LLC (Georgia Tech)     12.
Management Agreement effective as of January 27, 2014, by and between ARC
Hospitality TRS Stratford, LLC and American Realty Capital Hospitality
Properties, LLC  (Homewood Suites Stratford)       Interstate Managed Agreements
    13. Hotel Management Agreement dated as of October 15, 2015, by and between
ARC Hospitality SWN INT NTC TRS, LP and American Realty Capital Hospitality
Properties, LLC (Hampton Inn & Suites El Paso – Airport)     14. Hotel
Management Agreement dated as of February 11, 2016, by and between ARC
Hospitality SWN TRS, LLC and American Realty Capital Hospitality Properties, LLC
(Fairfield Inn & Suites Denver Airport)     15. Hotel Management Agreement dated
as of February 11, 2016, by and between ARC Hospitality SWN TRS, LLC and
American Realty Capital Hospitality Properties, LLC (Hilton Garden Inn Fort
Collins)     16. Hotel Management Agreement dated as of February 11, 2016, by
and between ARC Hospitality SWN TRS, LLC and American Realty Capital Hospitality
Properties, LLC (Hampton Inn – Ft. Collins)     17. Hotel Management Agreement
dated as of February 11, 2016, by and between ARC Hospitality SWN TRS, LLC and
American Realty Capital Hospitality Properties, LLC (Springhill Suites Denver
Airport)       Other Property Management Agreements     18. Management Agreement
effective as of February 27, 2015 by and between ARC Hospitality Portfolio I HIL
TRS, LLC, ARC Hospitality Portfolio I NTC HIL TRS, LP, and American Realty
Capital Hospitality Grace Portfolio (Hilton - 35 Hotels)      

This has been amended by that certain First Amendment to Management Agreement
dated as of November 2, 2016, by and between ARC Hospitality Portfolio I HIL
TRS, LLC, ARC Hospitality Portfolio I NTC HIL TRS, LP, and American Realty
Capital Hospitality Grace Portfolio, LLC, relating to the Homewood Suites
Phoenix-Biltmore.

 

 

 

 

  This has also been amended by that certain Hilton Omnibus 2016 Incentive Fee
Implementation (Prime Pool I) made effective as of January 1, 2016, between ARC
Hospitality Portfolio I HIL TRS, LLC, ARC Hospitality Portfolio I NTC HIL TRS,
LP and American Realty Capital Hospitality Grace Portfolio, LLC (Hilton – 35
Hotels)     19.

Management Agreement effective as of February 27, 2015 by and between ARC
Hospitality Portfolio II HIL TRS, LLC, ARC Hospitality Portfolio II NTC HIL TRS,
LP, and American Realty Capital Hospitality Grace Portfolio, LLC (Hilton - 7
Hotels)

 

This has been amended by that Hilton Omnibus 2016 Incentive Fee Implementation
(Prime Pool II) made effective as of January 1, 2016, between ARC Hospitality
Portfolio II HIL TRS, LLC, ARC Hospitality Portfolio II NTC HIL TRS, LP and
American Realty Capital Hospitality Grace Portfolio, LLC (Hilton - 7 Hotels)

    20.

Management Agreement effective as of February 27, 2015 by and between ARC
Hospitality Portfolio I MCK TRS, LLC, ARC Hospitality Portfolio I NTC TRS, LP,
and American Realty Capital Hospitality Grace Portfolio, LLC (McKibbon - 19
Hotels)

    21.

Management Agreement effective as of February 27, 2015 by and between ARC
Hospitality Portfolio II NTC TRS, LP, ARC Hospitality Portfolio II MISC TRS,
LLC, and American Realty Capital Hospitality Grace Portfolio, LLC (McKibbon - 2
Hotels)

    22.

Management Agreement effective as of February 27, 2015 by and between ARC
Hospitality Portfolio I MISC TRS, LLC and American Realty Capital Hospitality
Grace Portfolio, LLC (InnVentures - Residence Inn Boise)

    23. Management Agreement effective as of February 27, 2015 by and between
ARC Hospitality Portfolio I MISC TRS, LLC and American Realty Capital
Hospitality Grace Portfolio, LLC (InnVentures - Residence Inn Portland)      
Short-Term Managed Agreements1     24. Management Agreement effective as of
February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn Albany – Wolf Road)

 

 

1 Numbers 24-65 below have been amended by that certain Omnibus 2016 Incentive
Fee Implementation Sub Agreement made effective as of January 1, 2016, between
American Realty Capital Hospitality Grace Portfolio, LLC and the management
entities listed on Exhibit A thereto. (Hilton – 42 Hotels)

 

 

 

 

25. Management Agreement effective as of February 27, 2015 by and between
American Realty Capital Hospitality Grace Portfolio, LLC and Hampton Inns
Management LLC (Hampton Inn Baltimore – Glen Burnie)     26. Management
Agreement effective as of February 27, 2015 by and between American Realty
Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn Beckley)     27. Management Agreement effective as of February 27,
2015 by and between American Realty Capital Hospitality Grace Portfolio, LLC and
Hampton Inns Management LLC (Hampton Inn Birmingham / Mountain Brook)     28.
Management Agreement effective as of February 27, 2015 by and between American
Realty Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn Boca Raton – Deerfield Beach)     29. Management Agreement
effective as of February 27, 2015 by and between American Realty Capital
Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn
Boca Raton)     30. Management Agreement effective as of February 27, 2015 by
and between American Realty Capital Hospitality Grace Portfolio, LLC and Hampton
Inns Management LLC (Hampton Inn Charleston Airport)     31. Management
Agreement effective as of February 27, 2015 by and between American Realty
Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn Charlotte / Gastonia)     32. Management Agreement effective as of
February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn Chattanooga Airport
/ I-75)     33. Management Agreement effective as of February 27, 2015 by and
between American Realty Capital Hospitality Grace Portfolio, LLC and Hampton
Inns Management LLC (Hampton Inn Chicago / Gurnee)     34. Management Agreement
effective as of February 27, 2015 by and between American Realty Capital
Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn
Cleveland / Westlake)     35. Management Agreement effective as of February 27,
2015 by and between American Realty Capital Hospitality Grace Portfolio, LLC and
Hampton Inns Management LLC (Hampton Inn & Suites Colorado Springs Air Force
Academy)     36. Management Agreement effective as of February 27, 2015 by and
between American Realty Capital Hospitality Grace Portfolio, LLC and Hampton
Inns Management LLC (Hampton Inn Columbus – I-26 Airport)

 

 

 

 

37. Management Agreement effective as of February 27, 2015 by and between
American Realty Capital Hospitality Grace Portfolio, LLC and Hampton Inns
Management LLC (Hampton Inn Columbus / Dublin)     38. Management Agreement
effective as of February 27, 2015 by and between American Realty Capital
Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn
Columbus Airport)     39. Management Agreement effective as of February 27, 2015
by and between American Realty Capital Hospitality Grace Portfolio, LLC and
Hampton Inns Management LLC (Hampton Inn Dallas - Addison)     40. Management
Agreement effective as of February 27, 2015 by and between American Realty
Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn Detroit / Madison Heights / South Troy)     41. Management
Agreement effective as of February 27, 2015 by and between American Realty
Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn Detroit / Northville)     42. Management Agreement effective as of
February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn Fayetteville I-95)  
  43. Management Agreement effective as of February 27, 2015 by and between
American Realty Capital Hospitality Grace Portfolio, LLC and Hampton Inns
Management LLC (Hampton Inn Kansas City / Overland Park)     44. Management
Agreement effective as of February 27, 2015 by and between American Realty
Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn Kansas City – Airport)     45. Management Agreement effective as of
February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn Memphis Poplar)    
46. Management Agreement effective as of February 27, 2015 by and between
American Realty Capital Hospitality Grace Portfolio, LLC and Hampton Inns
Management LLC (Hampton Inn Morgantown)     47. Management Agreement effective
as of February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn Norfolk Naval Base)

 

 

 

 

48. Management Agreement effective as of February 27, 2015 by and between
American Realty Capital Hospitality Grace Portfolio, LLC and Hampton Inns
Management LLC (Hampton Inn Palm Beach Gardens)     49. Management Agreement
effective as of February 27, 2015 by and between American Realty Capital
Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn
Pickwick Dam at Shiloh Falls)     50. Management Agreement effective as of
February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn Scranton at Montage
Mountain)     51. Management Agreement effective as of February 27, 2015 by and
between American Realty Capital Hospitality Grace Portfolio, LLC and Hampton
Inns Management LLC (Hampton Inn St. Louis / Westport)     52. Management
Agreement effective as of February 27, 2015 by and between American Realty
Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn State College)     53. Management Agreement effective as of
February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn West Palm Beach)    
54. Management Agreement effective as of February 27, 2015 by and between
American Realty Capital Hospitality Grace Portfolio, LLC and Hampton Inns
Management LLC (Hampton Inn & Suites Boynton Beach)     55. Management Agreement
effective as of February 27, 2015 by and between American Realty Capital
Hospitality Grace Portfolio, LLC and Homewood Suites Management LLC (Homewood
Suites San Antonio - Northwest)     56. Management Agreement effective as of
February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Homewood Suites Management LLC (Homewood Suites Hartford /
Windsor Locks)     57. Management Agreement effective as of February 27, 2015 by
and between American Realty Capital Hospitality Grace Portfolio, LLC and
Homewood Suites Management LLC (Homewood Suites Memphis Germantown)     58.
Management Agreement effective as of February 27, 2015 by and between American
Realty Capital Hospitality Grace Portfolio, LLC and Homewood Suites Management
LLC (Homewood Suites Phoenix-Biltmore)     59. Management Agreement effective as
of February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and Homewood Suites Management LLC (Homewood Suites Augusta)

 

 

 

 

60. Management Agreement effective as of February 27, 2015 by and between
American Realty Capital Hospitality Grace Portfolio, LLC and Homewood Suites
Management LLC (Homewood Suites Seattle Downtown)     61. Management Agreement
effective as of February 27, 2015 by and between American Realty Capital
Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC (Hampton Inn
Chicago / Naperville)     62. Management Agreement effective as of February 27,
2015 by and between American Realty Capital Hospitality Grace Portfolio, LLC and
Hampton Inns Management LLC (Hampton Inn College Station)     63. Management
Agreement effective as of February 27, 2015 by and between American Realty
Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn Indianapolis)     64. Management Agreement effective as of February
27, 2015 by and between American Realty Capital Hospitality Grace Portfolio, LLC
and Hampton Inns Management LLC (Hampton Inn Knoxville Airport)     65.
Management Agreement effective as of February 27, 2015 by and between American
Realty Capital Hospitality Grace Portfolio, LLC and Hampton Inns Management LLC
(Hampton Inn Milford)     66. Management Agreement effective as of February 27,
2015 by and between American Realty Capital Hospitality Grace Portfolio, LLC and
InnVentures IVI, LP (Residence Inn Boise)     67. Management Agreement effective
as of February 27, 2015 by and between American Realty Capital Hospitality Grace
Portfolio, LLC and InnVentures IVI, LP (Residence Inn Portland)     68.
Management Agreement dated October 3, 2014 by and between American Realty
Capital Hospitality Grace Portfolio, LLC and McKibbon Hotel Management, Inc.
(McKibbon - 19 Hotels)     69. Management Agreement dated October 3, 2014 by and
between American Realty Capital Hospitality Grace Portfolio, LLC and McKibbon
Hotel Management, Inc. (McKibbon - 2 Hotels)

 

 

 

 

Exhibit B

 

Advisory Agreement Amendment

 

[see attached]

 

 

 

 

EXHIBIT B

 

THIRD AMENDMENT

ADVISORY AGREEMENT

 

This THIRD AMENDMENT TO ADVISORY AGREEMENT (this “Amendment”) is entered into as
of [•], 2017, by and among Hospitality Investors Trust, Inc. (formerly known as
American Realty Capital Hospitality Trust, Inc.), a Maryland corporation (the
“Company”), Hospitality Investors Trust Operating Partnership, L.P. (formerly
known as American Realty Capital Hospitality Operating Partnership, L.P.), a
Delaware limited partnership (the “Operating Partnership”), and American Realty
Capital Hospitality Advisors, LLC, a Delaware limited liability company (the
“Advisor”).

 

RECITALS

 

WHEREAS, the Company, the Operating Partnership and the Advisor entered into
that certain Advisory Agreement, dated as of January 7, 2014 (as amended, the
“Advisory Agreement”);

 

WHEREAS, the Company, the Operating Partnership and the Advisor entered into
that First Amendment to Advisory Agreement, dated as of November 11, 2015;

 

WHEREAS, the Company, the Operating Partnership and the Advisor entered into
that Second Amendment to Advisory Agreement, dated as of March 24, 2016;

 

WHEREAS, on January [__], 2017, each of the Company, the Operating Partnership,
the Advisor and certain other parties entered into that certain Framework
Agreement (the “Framework Agreement”); and

 

WHEREAS, the Company, the Operating Partnership and the Advisor desire to make
certain amendments to the Advisory Agreement.

 

NOW, THEREFORE, in consideration of the premises made hereunder, and for good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:

 

1.Amendment to Section 10(i). Effective as of the date hereof, Section 10(i) of
the Advisory Agreement is hereby amended by adding the following sentence at the
end thereof:

 

“Notwithstanding anything contained in this Agreement to the contrary, from and
after the date of Closing (as defined in the Framework Agreement), the Asset
Management Fee payable under this Agreement in respect of any period commencing
after such date shall be reduced by an aggregate amount equal to the cost of the
base compensation of all Transition Personnel (as defined in the Framework
Agreement) that is then being paid directly by the Company, the Operating
Partnership or any of their respective subsidiaries (and not by the Advisor or
any of its Affiliates); provided, however, that the amount of the reduction for
each such Transition Personnel shall not be greater than the base compensation
paid to such Transition Personnel by the Advisor or any of its affiliates prior
to the Closing (as defined in the Framework Agreement).”

 

 

 

 

2.Addition of Section 10(k). Effective as of the date hereof, the Advisory
Agreement is supplemented by the addition of the following new Section 10(k):

 

“(k) Termination of Certain Fees. Notwithstanding anything contained in this
Agreement to the contrary, from and after the date hereof, no amounts shall be
payable in respect of any Acquisition Fees, Real Estate Commissions, Annual
Subordinated Performance Fees, Financing Coordination Fees or any other fees,
costs or reimbursements under this Section 10 (other than Section 10(i)), in
each case, in respect of any event or transaction consummated or entered into on
or after the date hereof.”

 

3.Addition of Section 11(c). Effective as of the date hereof, the Advisory
Agreement is supplemented by the addition of the following new Section 11(c):

 

“(c) The Company and the Operating Partnership shall have the right, but not the
obligation, to offset any amounts payable directly or reimbursable to the
Advisor pursuant to this Section 11 in respect of periods from and after the
date hereof against any amounts by which the Asset Management Fee is to be
reduced pursuant to the last sentence of Section 10(i); provided, however, that
the Asset Management Fee shall not also be (and has not previously been) reduced
by the amount so offset.”

 

4.Amendment to Section 16. Effective as of the date hereof, Section 16 of the
Advisory Agreement is hereby replaced in its entirety with the following:

 

“16. TERM OF AGREEMENT. This Agreement shall continue in force for a period
ending on [March 31, 2017/DATE OF CLOSING] [May 31, 2017] 1 . Thereafter, the
term may be renewed for one additional two calendar month period upon written
notice to the Advisor by the Independent Directors of the Company given no later
than May 1, 2017.”

 

5.Amendment to Section 17. Effective as of the date hereof, the last sentence of
Section 17 of the Advisory Agreement is hereby replaced in its entirety with the
following:

 

“The provisions of Sections 15 (as modified by Section 3(b)(iv) of the Framework
Agreement and the terms of the Royalty-Free IP License (as defined in the
Framework Agreement)), 19, 21 to 22 (inclusive, but as modified by Section 2(c)
of the Framework Agreement), and 23 through 31 (inclusive) shall survive any
expiration or earlier termination of this Agreement.”

 

[Signature Page Follows]

 

 

 

 

1  Date to be inserted prior to signing based on whether written notice has been
delivered in accordance with Section 3(a) of the Framework Agreement.

 

 

 

 

IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, have
duly executed and delivered this Amendment as of the date first set forth above.

 

  HOSPITALITY INVESTORS TRUST, INC.       By:     Name:     Title:          
HOSPITALITY INVESTORS TRUST OPERATING PARTNERSHIP, L.P.       By: Hospitality
Investors Trust, Inc., its general partner       By:     Name:     Title:      
    AMERICAN REALTY CAPITAL HOSPITALITY ADVISORS, LLC       By: American Realty
Capital Hospitality Special Limited Partner, LLC, its sole member       By:
American Realty Capital IX, LLC, its sole member       By: AR Capital, LLC, its
sole member       By:     Name: Edward M. Weil, Jr.   Title: Chief Executive
Officer

 

[Signature Page to Third Amendment to Advisory Agreement]

 

 

 

 

 

Exhibit C-1

 

Amended Crestline Managed Agreement

 

[see attached]

 

 

 

  

EXHIBIT C-1

 

ASSIGNMENT AND AMENDMENT OF

CRESTLINE SWN MANAGEMENT AGREEMENT

 

This Assignment and Amendment of Crestline SWN Management Agreement
(“Assignment”) is made effective as of _________, 2017 (“Effective Date”) by and
among American Realty Capital Hospitality PROPERTIES, LLC, a Delaware limited
liability company, with an address at 405 Park Avenue, New York, New York 10022
(“Assignor”); CRESTLINE HOTELS & RESORTS, LLC, a Delaware limited liability
company, with an address at 3950 University Drive, Suite 301, Fairfax, Virginia
22030 (“Assignee”); and ARC HOSPITALITY SWN INT NTC TRS, LP, a Delaware limited
partnership, with an address at 405 Park Avenue, New York, New York 10022
(“TRS 1”), ARC HOSPITALITY SWN TRS, LLC, a Delaware limited liability company,
with an address at 405 Park Avenue, New York, New York 10022 (“TRS 2”), and ARC
HOSPITALITY SWN CRS NTC TRS, LP, a Delaware limited partnership, with an address
at 405 Park Avenue, New York, New York 10022 (“TRS 3”) (TRS 1, TRS 2, and TRS 3,
collectively, “TRS”).

 

RECITALS:

 

WHEREAS, Assignor, TRS 2, and TRS 3 are parties to that certain Management
Agreement dated October 15, 2015 (inclusive of the “slip page” replacement to
page 14 that was substituted after execution of such Management Agreement) with
respect to the management by Assignor of fifteen of the hotels listed on
Exhibit A thereto (p. 1, hotels #3, 5, 9-10, and 13-16; p. 2, hotels #2, 5, 8,
14, 17, and 19; and p. 3, hotel #2) (such hotels, the “Crestline Hotels”), as
assigned and amended concurrently with the execution of this Assignment (the
“Crestline SWN Management Agreement”);

 

WHEREAS, Assignor desires to assign its rights and obligations under the
Crestline SWN Management Agreement to Assignee; Assignee desires to accept the
assignment of Assignor’s rights and obligations under Crestline SWN Management
Agreement, as further amended by this Assignment; and TRS desires to consent to
this Assignment and to have Assignee manage and operate the Crestline Hotels
from and after the Effective Date, in accordance with the Crestline SWN
Management Agreement as further amended by this Assignment;

 

WHEREAS, Assignor and TRS 1 are parties to that certain Hotel Management
Agreement dated October 15, 2015, with respect to the management of the Hampton
Inn & Suites El Paso-Airport, and Assignor and TRS 2 are parties to those
certain Hotel Management Agreements dated February 11, 2016, with respect to the
management of the Fairfield Inn & Suites Denver Airport, the SpringHill Suites
Denver Airport, the Hilton Garden Inn Fort Collins, and the Hampton Inn Fort
Collins (all of the Hotel Management Agreements referenced in this Recital,
collectively, “Interstate Management Agreements”, and all of the hotels
referenced in this Recital, collectively, “Interstate Hotels”);

 

WHEREAS, Assignor and Interstate Management Company, LLC are parties to that
certain Hotel Management Agreement dated October 15, 2015, and to those four
certain Hotel Management Agreements dated February 11, 2016, with respect to the
management of the Interstate Hotels (such Hotel Management Agreements, the
“Interstate Sub-MAs”);

 

 

 

 

WHEREAS, Assignor is, contemporaneously with execution of this Assignment,
terminating the Interstate Management Agreements and the Interstate Sub-MAs with
respect to each of the Interstate Hotels;

 

WHEREAS, Assignee and TRS wish to further amend the Crestline SWN Management
Agreement to add the Interstate Hotels to Exhibit A thereto and to add TRS 1 as
a party thereto, such that Assignee will, from and after the Effective Date,
manage the Interstate Hotels pursuant to the Crestline SWN Management Agreement
as further amended by this Assignment;

 

NOW THEREFORE, in consideration of the foregoing recitals and the premises and
the mutual covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, and
intending to be legally bound, the parties hereto agree as follows:

 

1.Assignor hereby assigns, transfers and conveys to Assignee all of Assignor’s
rights, title and obligations in, to and under the Crestline SWN Management
Agreement, and Assignee hereby accepts and assumes all such rights, title and
obligations of Assignor in, to and under the Crestline SWN Management Agreement.
TRS hereby consents to such assignment and assumption.

 

2.Each of Assignee and TRS agrees that the Crestline SWN Management Agreement is
hereby further amended as follows:

 

a.The Interstate Hotels are added to Exhibit A and TRS 1 is added to the
preamble and to the defined term “TRS”, such that TRS 1 will become a party to
the Crestline SWN Management Agreement and Assignee will, from and after the
Effective Date, manage each of the Interstate Hotels on behalf of the applicable
TRS pursuant to the Crestline SWN Management Agreement;

 

b.The Management Commencement Date is acknowledged and agreed to be (i) October
15, 2015, with respect to the Hampton Inn & Suites El Paso-Airport, such that
the Initial Term of such Hotel shall expire on December 31, 2035, and
(ii) February 11, 2016, with respect to the Fairfield Inn & Suites Denver
Airport, the SpringHill Suites Denver Airport, the Hilton Garden Inn Fort
Collins, and the Hampton Inn Fort Collins, such that the Initial Term of each
such Hotel shall expire on December 31, 2036.

 

 2

 

 

c.The following is added at the end of Section 5.01:

 

Notwithstanding the foregoing, effective as of the first day of the forty-ninth
(49th) month following the defined “Effective Date” of that certain Assignment
and Amendment of Crestline SWN Management Agreement (the “Assignment”), dated
[closing/assignment date] (the “Effective Date” as defined in the Assignment,
the “Assignment Date”, and such first day of the forty-ninth (49th) month
thereafter, the “Sale Termination Right Effective Date”), TRS shall have the
right to Terminate this Agreement with respect to any individual Hotel effective
immediately upon a sale of such Hotel (whether alone or as part of a portfolio
transaction, and whether by way of merger, consolidation, or otherwise) so long
as, at or prior to the time of such Termination, either (at TRS’s election) (x)
TRS pays, or causes to be paid, to Management Company an amount in cash equal to
(i) the Management Fees earned, due, and payable with respect to such Hotel in
the trailing twelve (12) full months (after normalizing such Management Fees to
account for any rooms which may have been vacant during such period as a result
of PIP work or other construction, repair, or improvement work performed at such
Hotel), multiplied by (ii) two and one-half (2.5), or (y) if the sale of the
Hotel in question is occurring during the period prior to the six (6)-year
anniversary of the Assignment Date, TRS effects a Property Replacement in
accordance with the immediately following paragraph.

 

In addition, if TRS conducts a sale of any Hotel (whether alone or as a part of
a portfolio transaction, and whether by way of merger, consolidation or
otherwise) after the Assignment Date but prior to the date that is six (6) years
following the Assignment Date, TRS shall have the right to Terminate this
Agreement with respect to such Hotel if TRS concurrently adds to this Agreement
as a “Hotel” a hotel (“Replacement Hotel”) that (A) was owned by an Affiliate of
TRS as of the Assignment Date, and continues to be owned by an Affiliate of TRS
as of the date of the sale of the Hotel in question (the “Sale Date”); (B) is,
at the time of the Sale Date, subject to a management agreement that (I) has a
term of one year or less, and/or (II) includes a right to terminate without
cause upon notice of one year or less; and (C) has, as of the Sale Date, the
same or greater historical annual revenue, over the year preceding the Sale
Date, as the Hotel that is being Terminated (such addition of a Replacement
Hotel in accordance with this paragraph, a “Property Replacement”).

 

For the avoidance of doubt, any sale of a Hotel that results in a Termination of
this Agreement with respect to such Hotel and also complies with terms and
conditions set forth in this Section 5.01 shall not be subject to the
requirements of Section 20.01 of this Agreement.

 

d.Section 6.01.A. is amended to replace the entire current provision with the
following:

 

In consideration of the services to be performed during the Term of this
Agreement by Management Company, Management Company shall be paid a periodic
base management fee (“Base Management Fee”) in the amount of three percent (3%)
of Gross Revenues for each Accounting Period. Each such periodic fee shall be
paid to Management Company (or retained by Management Company as provided below)
at such time as the final monthly report for such Accounting Period is submitted
to TRS as provided in Section 6.02 A below.

 

 3

 

 

e.Section 6.01.C. is deleted in its entirety.

 

f.Section 19.01.A. is amended by replacing the period at the end of subsection
(iii) with a semicolon, and by adding the following language as a new paragraph
after subsection (iii):

 

Notwithstanding anything in this Section 19.01.A. to the contrary, Management
Company’s rights to assign or transfer its interest in this Agreement or
delegate any responsibilities hereunder shall remain subject to satisfaction of
all applicable rights of first refusal or similar obligations under that certain
“Framework Agreement”, by and among American Realty Capital Hospitality
Advisors, LLC, American Realty Capital Hospitality Properties, LLC, American
Realty Capital Hospitality Grace Portfolio, LLC, Crestline Hotels & Resorts,
LLC, American Realty Capital Hospitality Trust, Inc., American Realty Capital
Hospitality Operating Partnership, L.P., American Realty Capital Hospitality
Special Limited Partnership, LLC and [INVESTOR], dated _________ (the “Framework
Agreement”) and no assignment, transfer or delegation by the Management Company
shall be permitted hereunder without compliance with such provisions of the
Framework Agreement.

 

g.Section 20.01 is amended to add the following at the end of such section:

 

Notwithstanding the foregoing and for the avoidance of doubt, the terms and
conditions set forth in this Section 20.01 of this Agreement shall not apply in
the event that any sale of a Hotel that results in a Termination of this
Agreement with respect to such Hotel otherwise complies with terms and
conditions set forth in Section 5.01.

 

h.Section 22.08 is amended [insert new notice addressees/addresses for TRS and
for Management Company]

 

3.This Assignment is executed by, and shall be binding upon and inure to the
benefit of, the parties hereto and each of their respective administrators,
personal representatives, legal representatives, heirs, successors and permitted
assigns. None of the provisions of this Assignment shall be for the benefit of
or enforceable by any other person.

 

4.This Assignment may not be amended nor may any rights hereunder be waived
except by an instrument in writing signed by the parties sought to be charged
with such amendment or waiver.

 

 4

 

 

5.This Assignment may be executed in one or more counterparts, each of which
shall be deemed an original and it will not be necessary in making proof of this
Assignment or the terms of this Assignment to produce or account for more than
one of such counterparts. All counterparts shall constitute one and the same
instrument. Each party may execute this Assignment via a facsimile (or
transmission of a .pdf file) of this Assignment. In addition, facsimile or .pdf
signatures of authorized signatories of the parties shall be valid and binding
and delivery of a facsimile or .pdf signature by any party shall constitute due
execution and delivery of this Assignment.

 

6.Except as specifically modified by this Assignment, all of the provisions of
the Crestline SWN Management Agreement are unchanged and continue in full force
and effect. In the event of any conflicts between the Crestline SWN Management
Agreement and this Assignment, this Assignment shall control.

 

[Signatures appear on the following page]

 

 5

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers.

 

WITNESS:   ASSIGNOR:           American Realty Capital Hospitality PROPERTIES,
LLC,     a Delaware limited liability company           By:       Name:    
Title:       WITNESS:   ASSIGNEE:           CRESTLINE HOTELS & RESORTS, LLC,    
a Delaware limited liability company           By:       Authorized Signatory  
    WITNESS:   TRS 1:           ARC HOSPITALITY SWN INT NTC TRS, LP,     a
Delaware limited partnership           By: ARC HOSPITALITY SWN NTC TRS GP, LLC,
its general partner      

 

    By:       Name:       Title:       Date:  

 

 

 6

 

 

    TRS 2:           ARC HOSPITALITY SWN TRS, LLC,     a Delaware limited
liability company           By:       Authorized Signatory           TRS 3:    
      ARC HOSPITALITY SWN CRS NTC TRS, LP,     a Delaware limited partnership  
        By: ARC HOSPITALITY SWN NTC TRS GP,
LLC, its general partner

 

    By:       Name:       Title:       Date:  

 

 7 

 

  

EXHIBIT C-1

 

ASSIGNMENT AND AMENDMENT OF CURRENT MANAGEMENT AGREEMENT

 

This Assignment and Amendment of Current Management Agreement (“Assignment”) is
made effective as of [       ], 2017 (“Effective Date”) by and among American
Realty Capital Hospitality Grace Portfolio, LLC, a Delaware limited liability
company, with an address at 405 Park Avenue, New York, New York 10022
(“Assignor”); CRESTLINE HOTELS & RESORTS, LLC, a Delaware limited liability
company, with an address at 3950 University Drive, Suite 301, Fairfax, VA 22030
(“Assignee”); and ARC HOSPITALITY PORTFOLIO I TRS, LLC, ARC HOSPITALITY
PORTFOLIO I NTC TRS, LP, and ARC HOSPITALITY PORTFOLIO I MISC TRS, LLC
(collectively, “TRS”).

 

RECITALS:

 

WHEREAS, on February 27, 2015, on the one hand, ARC Hospitality Portfolio I TRS,
LLC and ARC HOSPITALITY PORTFOLIO I NTC TRS, LP, and, on the other hand,
American Realty Capital Hospitality Grace Portfolio, LLC, entered into a
“Management Agreement” (the “Initial Management Agreement”) with respect to the
eighteen hotels listed as “Hotels” on Exhibit A thereto, with a “Management
Commencement Date” (as defined in the Initial Management Agreement) of February
27, 2015; and

 

WHEREAS, on September 1, 2015, the parties to the Initial Management Agreement
entered into an Amended and Restated Management Agreement (the “Amended
Management Agreement”), which added ARC HOSPITALITY PORTFOLIO I MISC TRS, LLC
(together with the Initial TRS Entities, “TRS”) as a party, and added ten hotels
to Exhibit A thereto as “Hotels”, along with other minor changes; and

 

WHEREAS, on February 1, 2016, the parties further amended and restated the
Amended Management Agreement (the “Second Amended and Restated Management
Agreement”) to add four more hotels to Exhibit A as “Hotels” and to make other
minor changes; and

 

WHEREAS, on October 13, 2016, the parties amended the Second Amended and
Restated Management Agreement (the “First Amendment”, and the Second Amended and
Restated Management Agreement following such First Amendment, the “Current
Management Agreement”); and

 

WHEREAS, TRS holds leasehold title granted by ARC Hospitality Portfolio I Owner,
LLC and ARC Hospitality Portfolio I NTC Owner, LP (individually or as context
requires, the “Owner”) of certain real property and improvements more
particularly described on Exhibit A to the Current Management Agreement
(individually or collectively, as the context requires, the “Hotel”); and

 

 

 

 

WHEREAS, Assignor desires to assign its rights and obligations under the Current
Management Agreement to Assignee; Assignee desires to accept the assignment of
Assignor’s rights and obligations under Current Management Agreement, as further
amended by this Assignment; and TRS desires to consent to this Assignment and to
have Assignee manage and operate the Hotel from and after the Effective Date, in
accordance with the Current Management Agreement as further amended by this
Assignment;

 

NOW, THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by each of the parties, the parties hereto agree as follows:

 

1.Assignor hereby assigns, transfers and conveys to Assignee all of Assignor’s
rights, title and obligations in, to and under the Current Management Agreement,
and Assignee hereby accepts and assumes all such rights, title and obligations
of Assignor in, to and under the Current Management Agreement. TRS hereby
consents to such assignment and assumption.

 

2.Each of Assignee and TRS agrees that the Current Management Agreement is
hereby further amended as follows:

 

a.All references to “Management Company” shall hereafter be deemed to refer to
Assignee.

 

b.The definition of “Affiliate” is amended to delete subsection (i).

 

c.Section 5.01 is amended by adding the following at the end of the paragraph:

 

Notwithstanding the foregoing, effective as of the first day of the forty-ninth
(49th) month following the defined “Effective Date” of that certain Assignment
and Amendment of Current Management Agreement (the “Assignment”), dated
[closing/assignment date] (the “Effective Date” as defined in the Assignment,
the “Assignment Date”, and such first day of the forty-ninth (49th) month
thereafter, the “Sale Termination Right Effective Date”), TRS shall have the
right to Terminate this Agreement with respect to any individual Hotel effective
immediately upon a sale of such Hotel (whether alone or as part of a portfolio
transaction, and whether by way of merger, consolidation, or otherwise) so long
as, at or prior to the time of such Termination, either (at TRS’s election) (x)
TRS pays, or causes to be paid, to Management Company an amount in cash equal to
(i) the Management Fees earned, due, and payable with respect to such Hotel in
the trailing twelve (12) full months (after normalizing such Management Fees to
account for any rooms which may have been vacant during such period as a result
of PIP work or other construction, repair, or improvement work performed at such
Hotel), multiplied by (ii) two and one-half (2.5), or (y) if the sale of the
Hotel in question is occurring during the period prior to the six (6)-year
anniversary of the Assignment Date, TRS effects a Property Replacement in
accordance with the immediately following paragraph.

 

 

 

 

In addition, if TRS conducts a sale of any Hotel (whether alone or as a part of
a portfolio transaction, and whether by way of merger, consolidation or
otherwise) after the Assignment Date but prior to the date that is six (6) years
following the Assignment Date, TRS shall have the right to Terminate this
Agreement with respect to such Hotel if TRS concurrently adds to this Agreement
as a “Hotel” a hotel (“Replacement Hotel”) that (A) was owned by an Affiliate of
TRS as of the Assignment Date, and continues to be owned by an Affiliate of TRS
as of the date of the sale of the Hotel in question (the “Sale Date”); (B) is,
at the time of the Sale Date, subject to a management agreement that (I) has a
term of one year or less, and/or (II) includes a right to terminate without
cause upon notice of one year or less; and (C) has, as of the Sale Date, the
same or greater historical annual revenue, over the year preceding the Sale
Date, as the Hotel that is being Terminated (such addition of a Replacement
Hotel in accordance with this paragraph, a “Property Replacement”).

 

For the avoidance of doubt, any sale of a Hotel that results in a Termination of
this Agreement with respect to such Hotel and also complies with terms and
conditions set forth in this Section 5.01 shall not be subject to the
requirements of Section 20.01 of this Agreement.

 

d.Section 6.01.A. is amended to replace the entire current provision with the
following:

 

In consideration of the services to be performed during the Term of this
Agreement by Management Company, Management Company shall be paid a periodic
base management fee (“Base Management Fee”) in the amount of three percent (3%)
of Gross Revenues for each Accounting Period. Each such periodic fee shall be
paid to Management Company (or retained by Management Company as provided below)
at such time as the final monthly report for such Accounting Period is submitted
to TRS as provided in Section 6.02 A below.

 

e.Section 6.01.C. is deleted in its entirety.

 

f.Section 19.01.A. is amended by replacing the period at the end of subsection
(iii) with a semicolon, and by adding the following language as a new paragraph
after subsection (iii):

 

Notwithstanding anything in this Section 19.01.A. to the contrary, Management
Company’s rights to assign or transfer its interest in this Agreement or
delegate any responsibilities hereunder shall remain subject to satisfaction of
all applicable rights of first refusal or similar obligations under that certain
“Framework Agreement”, by and among American Realty Capital Hospitality
Advisors, LLC, American Realty Capital Hospitality Properties, LLC, American
Realty Capital Hospitality Grace Portfolio, LLC, Crestline Hotels & Resorts,
LLC, American Realty Capital Hospitality Trust, Inc., American Realty Capital
Hospitality Operating Partnership, L.P., American Realty Capital Hospitality
Special Limited Partnership, LLC and [INVESTOR], dated _________ (the “Framework
Agreement”) and no assignment, transfer or delegation by the Management Company
shall be permitted hereunder without compliance with such provisions of the
Framework Agreement.

 

 

 

 

g.Section 20.01 is amended to add the following at the end of such section:

 

Notwithstanding the foregoing and for the avoidance of doubt, the terms and
conditions set forth in this Section 20.01 of this Agreement shall not apply in
the event that any sale of a Hotel that results in a Termination of this
Agreement with respect to such Hotel otherwise complies with terms and
conditions set forth in Section 5.01.

 

h.Section 22.08 is amended [insert new notice addressees/addresses for TRS and
for Management Company]

 

3.This Assignment is executed by, and shall be binding upon and inure to the
benefit of, the parties hereto and each of their respective administrators,
personal representatives, legal representatives, heirs, successors and permitted
assigns. None of the provisions of this Assignment shall be for the benefit of
or enforceable by any other person.

 

4.This Assignment may not be amended nor may any rights hereunder be waived
except by an instrument in writing signed by the parties sought to be charged
with such amendment or waiver.

 

5.This Assignment may be executed in one or more counterparts, each of which
shall be deemed an original and it will not be necessary in making proof of this
Assignment or the terms of this Assignment to produce or account for more than
one of such counterparts. All counterparts shall constitute one and the same
instrument. Each party may execute this Assignment via a facsimile (or
transmission of a .pdf file) of this Assignment. In addition, facsimile or .pdf
signatures of authorized signatories of the parties shall be valid and binding
and delivery of a facsimile or .pdf signature by any party shall constitute due
execution and delivery of this Assignment.

 

6.Except as specifically modified by this Assignment, all of the provisions of
the Current Management Agreement are unchanged and continue in full force and
effect. In the event of any conflicts between the Current Management Agreement
and this Assignment, this Assignment shall control.

 

[Signatures Follow on Next Page]

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
executed and delivered by their duly authorized officers as of the Effective
Date.

 

  ASSIGNOR:     American Realty Capital
Hospitality Grace Portfolio, LLC, a
Delaware limited liability company       By:           Name:       Title:      
Date:  

 

  ASSIGNEE:       CRESTLINE HOTELS & RESORTS, LLC, a
 Delaware limited liability company       By:           Name:       Title:      
Date:  

 

  TRS:      

ARC Hospitality Portfolio I TRS,

LLC, a Delaware limited liability company

      By:         Name:       Title:       Date:  

 

 

 

 

   

ARC Hospitality Portfolio I NTC

TRS, LP, a Delaware limited partnership

          By:

ARC HOSPITALITY PORTFOLIO I NTC

TRS GP, LLC, its general partner

            By:             Name:         Title:         Date:  

 

 

ARC Hospitality Portfolio I MISC

TRS, LLC, a Delaware limited liability company

      By:         Name:       Title:       Date:  

 

 

 

 

Exhibit C-2

 

RESERVED

 

 

 

 

EXHIBIT C-2

 

[RESERVED]

 

 

 

 

Exhibit C-3

 

Termination Agreement

 

[see attached]

 

 

 

   

EXHIBIT C-3

  

OMNIBUS AGREEMENT FOR TERMINATION OF

MANAGEMENT AGREEMENTS

 

This Omnibus Agreement for Termination of Management Agreement (“Agreement”), is
entered into as of ________, 2017 (the “Termination Date”), by and among (1) ARC
Hospitality Portfolio I HIL TRS, LLC, a Delaware limited liability company with
an address at 405 Park Avenue, New York, New York 10022 and ARC Hospitality
Portfolio I NTC HIL TRS, LP, a Delaware limited partnership with an address at
405 Park Avenue, New York, New York 10022 (collectively hereinafter referred to
as “Hilton Pool I Owner”); (2) ARC Hospitality Portfolio II HIL TRS, LLC, a
Delaware limited liability company with an address at 405 Park Avenue, New York,
New York 10022 and ARC HOSPITALITY PORTFOLIO II NTC HIL TRS, LP, a Delaware
limited partnership with an address at 405 Park Avenue, New York, New York 10022
(collectively hereinafter referred to as “Hilton Pool II Owner” (and together
with Hilton Pool I Owner, “Hilton Owner”)); (3) ARC Hospitality Portfolio I MCK
TRS, LLC, a Delaware limited liability company with an address at 405 Park
Avenue, New York, New York 10022 and ARC Hospitality Portfolio I NTC TRS, LP, a
Delaware limited partnership with an address at 405 Park Avenue, New York, New
York 10022 (collectively hereinafter referred to as “McKibbon Pool I Owner”);
(4) ARC Hospitality Portfolio II MISC TRS, LLC, a Delaware limited liability
company with an address at 405 Park Avenue, New York, New York 10022 and ARC
HOSPITALITY PORTFOLIO II NTC TRS, LP, a Delaware limited partnership with an
address at 405 Park Avenue, New York, New York 10022 (collectively hereinafter
referred to as “McKibbon Pool II Owner” (and together with McKibbon Pool I
Owner, “McKibbon Owner”)); (5) ARC HOSPITALITY PORTFOLIO I MISC TRS, LLC, a
Delaware limited liability company with an address at 405 Park Avenue, New York,
New York 10022 (“InnVentures Owner”); (6)  ARC HOSPITALITY SWN INT NTC TRS, LLP,
a Delaware limited partnership with an address at 405 Park Avenue, New York, New
York 10022 and ARC HOSPITALITY SWN TRS, LLC, a Delaware limited liability
company with an address at 405 Park Avenue, New York, New York 10022
(collectively hereinafter referred to as “Interstate Owner” (and together with
Hilton Owner, McKibbon Owner, and InnVentures Owner, “Owner”)); and (7) American
Realty Capital Hospitality Grace Portfolio, LLC, a Delaware limited liability
company, with an address at 405 Park Avenue, New York, New York 10022 (“Grace
Manager”) and American Realty Capital Hospitality PROPERTIES, LLC, a Delaware
limited liability company, with an address at 405 Park Avenue, New York, New
York 10022 (“ARC Manager” (and together with Grace Manager, “Manager”)).

 

 

 

 

 

WITNESSETH:

 

Hilton

WHEREAS, Hilton Pool I Owner and Grace Manager entered into a “Management
Agreement” dated as of February 27, 2015, amended by that certain First
Amendment to Management Agreement on November 2, 2016 and clarified by that
certain Omnibus 2016 Incentive Fee Implementation (collectively, the “Hilton
Pool I Prime Management Agreement”) pursuant to which Hilton Pool I Owner
engaged Grace Manager to act as Hilton Pool I Owner’s exclusive agent to
supervise, direct, and control management and operation of those certain hotels
fully described on Exhibit A to the Hilton Pool I Prime Management Agreement
(collectively, the “Hilton Pool I Hotels”) pursuant to the terms thereof;

 

WHEREAS, in accordance with the terms of the Hilton Pool I Prime Management
Agreement and pursuant to those certain “Management Agreements” (“Hilton Pool I
Sub-MAs”) entered into contemporaneously with the Hilton Pool I Prime Management
Agreement, between Grace Manager and the manager entities listed in the Hilton
Pool I Sub-MAs (such manager entities, the “Hilton Pool I Sub-Managers”), Grace
Manager delegated the management of the Hilton Pool I Hotels to the Hilton
Pool I Sub-Managers;

 

WHEREAS, Hilton Pool II Owner and Grace Manager entered into a “Management
Agreement” dated as of February 27, 2015 and clarified by that certain Omnibus
2016 Incentive Fee Implementation (the “Hilton Pool II Prime Management
Agreement” (and together with the Hilton Pool I Prime Management Agreement, the
“Hilton Prime Management Agreements”)) pursuant to which Hilton Pool II Owner
engaged Grace Manager to act as Hilton Pool II Owner’s exclusive agent to
supervise, direct, and control management and operation of those certain hotels
fully described on Exhibit A to the Hilton Pool II Prime Management Agreement
(collectively, the “Hilton Pool II Hotels” (and together with the Hilton Pool I
Hotels, the “Hilton Hotels”)) pursuant to the terms thereof;

 

WHEREAS, in accordance with the terms of the Hilton Pool II Prime Management
Agreement and pursuant to those certain “Management Agreements” (“Hilton Pool II
Sub-MAs” (and together with the Hilton Pool I Sub-MAs, the “Hilton Sub-MAs”))
entered into contemporaneously with the Hilton Pool II Prime Management
Agreement with respect to the Hilton Hotels, between Grace Manager and the
manager entities listed in the Hilton Pool II Sub-MAs (such manager entities,
the “Hilton Pool II Sub-Managers” (and together with the Hilton Pool I
Sub-Managers, the “Hilton Sub-Managers”)), Grace Manager delegated the
management of the Hilton Pool II Hotels to the Hilton Pool II Sub-Managers;

 

McKibbon

WHEREAS, McKibbon Pool I Owner and Grace Manager entered into a “Management
Agreement” dated as of February 27, 2015 (the “McKibbon Pool I Prime Management
Agreement”) pursuant to which McKibbon Pool I Owner engaged Grace Manager to act
as McKibbon Pool I Owner’s exclusive agent to supervise, direct, and control
management and operation of those certain hotels fully described on Exhibit A to
the McKibbon Pool I Prime Management Agreement (collectively, the “McKibbon
Pool I Hotels”) pursuant to the terms thereof;

 

2  

 

 

WHEREAS, in accordance with the terms of the McKibbon Pool I Prime Management
Agreement and pursuant to that certain “Management Agreement” (“McKibbon Pool I
Sub-MA”) entered into contemporaneously with the McKibbon Pool I Prime
Management Agreement, between Grace Manager and McKibbon Hotel Management, Inc.
(the “McKibbon Sub-Manager”), Grace Manager delegated the management of the
McKibbon Pool I Hotels to the McKibbon Sub-Manager;

 

WHEREAS, McKibbon Pool II Owner and Grace Manager entered into a “Management
Agreement” dated as of February 27, 2015 (the “McKibbon Pool II Prime Management
Agreement” (and together with the McKibbon Pool I Prime Management Agreement,
the “McKibbon Prime Management Agreements”)) pursuant to which McKibbon Pool II
Owner engaged Grace Manager to act as McKibbon Pool II Owner’s exclusive agent
to supervise, direct, and control management and operation of those certain
hotels fully described on Exhibit A to the McKibbon Pool II Prime Management
Agreement (collectively, the “McKibbon Pool II Hotels” (and together with the
Hilton Pool I Hotels, the “McKibbon Hotels”)) pursuant to the terms thereof;

 

WHEREAS, in accordance with the terms of the McKibbon Pool II Prime Management
Agreement and pursuant to that certain “Management Agreement” (“McKibbon Pool II
Sub-MA” (and together with the McKibbon Pool I Sub-MA, the “McKibbon Sub-MAs”))
entered into contemporaneously with the McKibbon Pool II Prime Management
Agreement with respect to the McKibbon Hotels, between Grace Manager and
McKibbon Sub-Manager, Grace Manager delegated the management of the McKibbon
Pool II Hotels to the McKibbon Sub-Manager;

 

InnVentures

WHEREAS, InnVentures Owner and Grace Manager entered into two “Management
Agreements,” each dated as of February 27, 2015 (the “InnVentures Prime
Management Agreements”) pursuant to which InnVentures Owner engaged Grace
Manager to act as InnVentures Owner’s exclusive agent to supervise, direct, and
control management and operation of those certain hotels fully described in the
InnVentures Prime Management Agreements (collectively, the “InnVentures Hotels”)
pursuant to the terms thereof;

 

WHEREAS, in accordance with the terms of the InnVentures Prime Management
Agreements and pursuant to those certain “Management Agreements” (“InnVentures
Sub-MAs” (and together with the Hilton Sub-MAs and the McKibbon Sub-MAs, the
“Sub-MAs”)) entered into contemporaneously with the InnVentures Prime Management
Agreements with respect to the InnVentures Hotels, between Grace Manager and
InnVentures IVI, LP (the “InnVentures Sub-Manager” (and together with the Hilton
Sub-Managers and the McKibbon Sub-Manager, the “Sub-Managers”)), Grace Manager
delegated the management of the InnVentures Hotels to the InnVentures
Sub-Manager;

 

3  

 

 

Interstate

WHEREAS, Interstate Owner and ARC Manager entered into five “Hotel Management
Agreements,” the first of which was dated as of October 15, 2015, and the
remaining four of which were dated as of February 11, 2016 (collectively, the
“Interstate Prime Management Agreements” (and together with the Hilton Prime
Management Agreements, the McKibbon Prime Management Agreements, and the
InnVentures Prime Management Agreements, the “Prime Management Agreements”))
pursuant to which Interstate Owner engaged ARC Manager to act as Interstate
Owner’s exclusive agent to supervise, direct, and control management and
operation of the five hotels referenced in the Interstate Prime Management
Agreements (collectively, the “Interstate Hotels” (and together with the Hilton
Hotels, the McKibbon Hotels, and the InnVentures Hotels, the “Hotels”)) pursuant
to the terms thereof;

 

WHEREAS, in accordance with the terms of the Interstate Prime Management
Agreements and pursuant to those certain “Hotel Management Agreements”
(“Interstate Sub-MAs”) entered into contemporaneously with the Interstate Prime
Management Agreement with respect to the Interstate Hotels, between ARC Manager
and Interstate Management Company, LLC (the “Interstate Sub-Manager”), ARC
Manager delegated the management of the Interstate Hotels to the Interstate
Sub-Manager;

 

Assignments

WHEREAS, contemporaneously with the execution of this Agreement, (i) the Hilton
Sub-MAs are being assigned from Grace Manager to the applicable Hilton Owner
pursuant to that certain Omnibus Assignment and Amendment of Management
Agreement (“Hilton Assignment”), resulting in a direct contractual arrangement
between the applicable Hilton Owner and the applicable Hilton Sub-Managers with
respect to the management of the Hilton Hotels; (ii) the McKibbon Sub-MAs are
being assigned from Grace Manager to the applicable McKibbon Owner pursuant to
that certain Omnibus Assignment and Amendment of Management Agreement (“McKibbon
Assignment”), resulting in a direct contractual arrangement between the
applicable McKibbon Owner and the McKibbon Sub-Manager with respect to the
management of the McKibbon Hotels; (iii) the InnVentures Sub-MAs are being
assigned from Grace Manager to the applicable InnVentures Owner pursuant to that
certain Omnibus Assignment and Amendment of Management Agreement (“InnVentures
Assignment”), resulting in a direct contractual arrangement between the
InnVentures Owner and the InnVentures Sub-Manager with respect to the management
of the InnVentures Hotels; and (iv) (a) pursuant to that certain [insert name of
agreement to terminate Interstate Sub-MAs] the Interstate Sub-MAs are being
terminated, and (b) pursuant to that certain Assignment and Amendment of
Crestline SWN Management Agreement (“Crestline SWN Assignment” (and together
with the Hilton Assignment, the McKibbon Assignment, and the InnVentures
Assignment, the “Assignments”)), the management of the Interstate Hotels is
being transferred to Crestline Hotels & Resorts, LLC (“Crestline”);

 

Terminations

WHEREAS, Owner and Manager have agreed to terminate the Prime Management
Agreements, effective as of the Termination Date as provided in this Agreement,
such that management of the Hotels will hereafter be governed solely by the
assigned Sub-MAs or the Crestline SWN Assignment, as applicable.

 

4  

 

 

AGREEMENT:

NOW, THEREFORE, for the mutual covenants and considerations herein contained and
for other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, and intending to be legally bound, the parties hereto
agree as follows:

 

1.          Subject to and effective as of the Termination Date, each of the
Prime Management Agreements is hereby terminated and, from and after the
Termination Date, management of the Hotels by Sub-Managers or Crestline, as
applicable, will be governed solely by the applicable amended Sub-MAs (as
assigned to the applicable Owner pursuant to the Assignment) or by Crestline
pursuant to the Crestline SWN Assignment. As of the Termination Date, Manager
shall have no further obligations to manage the Hotels.

 

2.          Manager acknowledges and agrees that Manager will not receive any
payments in the future with respect to any services rendered to Owner under the
Prime Management Agreements or to be rendered to Owner pursuant to the Prime
Management Agreements on or prior to the Termination Date, other than the Base
Management Fee for the month in which the Termination Date occurs which shall be
payable by Owner to Manager in the normal course in accordance with, in the case
of the Hilton Hotels and the InnVentures Hotels, Section 9.1 of the Hilton Prime
Management Agreements or the InnVentures Prime Management Agreement, as the case
may be, in the case of the McKibbon Hotels, Section C of the Management Fee
Rider of the McKibbon Prime Management Agreements, and in the case of the
Interstate Hotels, Section 9.1 and Section 9.4 of the Interstate Prime
Management Agreements.

 

3.          Any capitalized term not specifically defined in this Agreement
shall have the definition given such term in the Prime Management Agreements.

 

4.          This Agreement is executed by, and shall be binding upon and inure
to the benefit of, the parties hereto and each of their respective
administrators, personal representatives, legal representatives, heirs,
successors and permitted assigns. None of the provisions of this Agreement shall
be for the benefit of or enforceable by any other person.

 

5.          This Agreement may not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the parties sought to be
charged with such amendment or waiver.

 

6.          This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original and it will not be necessary in making proof
of this Agreement or the terms of this Agreement to produce or account for more
than one of such counterparts. All counterparts shall constitute one and the
same instrument. Each party may execute this Agreement via a facsimile (or
transmission of a .pdf file) of this Agreement. In addition, facsimile or .pdf
signatures of authorized signatories of the parties shall be valid and binding
and delivery of a facsimile or .pdf signature by any party shall constitute due
execution and delivery of this Agreement.

 

5  

 

 

7.          Each of the parties hereto shall execute and deliver such further
instruments and assurances to provide such other documents as may be reasonably
required to effectuate the purpose of this Agreement.

 

8.          Subject to and effective as of the Termination Date, Manager, on
behalf of itself and its officers, employees, managers, equityholders, parents,
affiliates, heirs, executors, administrators, agents, successors and assigns,
irrevocably and unconditionally waives and releases any and all rights with
respect to, and releases, forever acquits and discharges Owner, and its
respective present and future equityholders, directors, officers, employees,
agents and other representatives, in their capacities as such, and their
respective heirs, executors, administrators, successors and assigns with respect
to, each and all claims, demands, charges, complaints, obligations, causes of
action, suits, liabilities, indebtedness, sums of money, covenants, agreements,
instruments, contracts (written or oral, express or implied), controversies,
promises, fees, expenses (including attorneys’ fees, costs and expenses),
damages and judgments, at law or in equity, in contract or tort, in the United
States, state, foreign or other judicial, administrative, arbitration or other
proceedings, of any nature whatsoever, known or unknown, suspected or
unsuspected, previously, now or hereafter arising, in each case which arise out
of, are based upon or are connected with the Prime Management Agreements, other
than the Base Management Fee for the month in which the Termination Date occurs
which shall be payable by Owner to Manager in the normal course in accordance
with, in the case of the Hilton Hotels and the InnVentures Hotels, Section 9.1
of the Hilton Prime Management Agreements or the InnVentures Prime Management
Agreement, as the case may be, in the case of the McKibbon Hotels, Section C of
the Management Fee Rider of the McKibbon Prime Management Agreements, and in the
case of the Interstate Hotels, Section 9.1 and Section 9.4 of the Interstate
Prime Management Agreements (the “Manager Released Claims”). Manager represents
and warrants that it has not assigned or otherwise transferred any right or
interest in or to any of Prime Management Agreements. MANAGER FURTHER
ACKNOWLEDGES THAT MANAGER IS AWARE THAT STATUTES EXIST THAT RENDER NULL AND VOID
RELEASES AND DISCHARGES OF ANY CLAIMS, RIGHTS, DEMANDS, LIABILITIES, ACTIONS OR
CAUSES OF ACTIONS THAT ARE UNKNOWN TO THE RELEASING OR DISCHARGING PARTY AT THE
TIME OF EXECUTION OF THE RELEASE AND DISCHARGE. MANAGER HEREBY EXPRESSLY AND
VOLUNTARILY WAIVES, SURRENDERS AND AGREES TO FOREGO ANY PROTECTION TO WHICH
MANAGER WOULD OTHERWISE BE ENTITLED BY VIRTUE OF THE EXISTENCE OF ANY SUCH
STATUTE IN ANY JURISDICTION. Notwithstanding anything to the contrary contained
herein, the release set forth in this Section 8 shall not affect or otherwise
apply to the parties’ rights and obligations in connection with the Prime
Management Agreements under this Agreement or pursuant to the Assignment.

 

6  

 

 

 

9.          Manager shall be solely responsible for the payment of any and all
claims for loss, damages, costs, expenses or otherwise, arising out of any act
or omission of its employees or agents in connection with the performance of
this Agreement or the Prime Management Agreements. Subject to and effective as
of the Termination Date, Manager shall indemnify, defend and hold harmless each
Owner and each of their respective directors, officers, employees, agents,
affiliates, successors and permitted assigns (collectively, the “Owner
Indemnitees”) from and against, and shall pay and reimburse each of the Owner
Indemnitees for, any and all claims, losses, damages, costs, expenses,
liabilities, actions or other charges of any kind, including reasonable
attorneys’ fees, costs of investigation and costs of enforcing any right to
indemnification hereunder or pursuing any insurance providers incurred or
sustained by, or imposed upon, the Owner Indemnitees based upon, resulting from,
arising out of or relating to any act or omission of the Manager, its employees
or its agents under the Sub-MAs or, in the case of the Hilton Hotels, under
those certain Owner Agreements by and among Manager, the respective Owner, and
the respective Sub-Manager, in each case, arising on or prior to the date of
this Agreement.

[Signatures follow on next page]

 

7  

 

 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.

 

Hilton Owners:         ARC Hospitality Portfolio I HIL TRS, LLC, a Delaware
limited liability company           By:       Name:       Title:       Date:    
        ARC Hospitality Portfolio I NTC HIL TRS, LP, a Delaware limited
partnership           By: ARC HOSPITALITY
PORTFOLIO I NTC TRS GP,
LLC, its general partner             By:       Name:       Title:       Date:  
          ARC Hospitality Portfolio II HIL TRS, LLC, a Delaware limited
liability company           By:       Name:       Title:       Date:  

  

8  

 

 

  ARC Hospitality Portfolio II NTC HIL TRS, LP, a Delaware limited partnership  
        By: ARC HOSPITALITY     PORTFOLIO II NTC TRS GP,     LLC, its general
partner             By:       Name:       Title:       Date:           Mckibbon
Owners:   ARC Hospitality Portfolio I MCK TRS, LLC, a Delaware limited liability
company           By:       Name:       Title:       Date:             ARC
Hospitality Portfolio I NTC TRS, LP, a Delaware limited partnership          
By: ARC HOSPITALITY     PORTFOLIO I NTC TRS GP,
LLC, its general partner             By:       Name:       Title:       Date:  

 

9  

 

 

  ARC Hospitality Portfolio II MISC TRS, LLC, a Delaware limited liability
company           By:       Name:       Title:       Date:             ARC
HOSPITALITY PORTFOLIO II NTC TRS, LP, a Delaware limited partnership          
By: ARC HOSPITALITY
PORTFOLIO II NTC TRS GP,  
LLC, its general partner           By:       Name:       Title:       Date:    
      Innventures Owner:     ARC HOSPITALITY PORTFOLIO I MISC TRS, LLC, a
Delaware limited liability company           By:       Name:       Title:      
Date:           Interstate Owners:     ARC HOSPITALITY SWN INT NTC TRS, LP, a
Delaware limited partnership           By: ARC HOSPITALITY SWN NTC     TRS GP,
LLC, its general partner             By:       Name:       Title:       Date:  

 

10  

 

 

  ARC HOSPITALITY SWN TRS, LLC, a Delaware limited liability company          
By:       Name:       Title:       Date:           MAnager:         American
Realty Capital Hospitality Grace Portfolio, LLC, a Delaware limited liability
company           By:       Name:       Title:       Date:             American
Realty Capital Hospitality PROPERTIES, LLC, a Delaware limited liability company
          By:       Name:       Title:       Date:  

  

11  

 

 

Exhibit C-4

 

Short-Term Managed Agreement

 

[see attached]

 

 

 

 

OMNIBUS ASSIGNMENT AND AMENDMENT OF MANAGEMENT AGREEMENT

 

This Omnibus Assignment and Amendment of Management Agreement (“Assignment”) is
made, effective as of _____, 2017 (the “Effective Date”), by and between (1)
American Realty Capital Hospitality Grace Portfolio, LLC, a Delaware limited
liability company, whose principal place of business is 405 Park Avenue, New
York, NY 10022 (“Assignor”); (2) ARC Hospitality Portfolio I HIL TRS, LLC, a
Delaware limited liability company, ARC Hospitality Portfolio I NTC HIL TRS, LP,
a Delaware limited partnership, ARC Hospitality Portfolio II HIL TRS, LLC, a
Delaware limited liability company, and ARC Hospitality Portfolio II NTC HIL
TRS, LP, a Delaware limited partnership, the principal place of business of each
of which is [insert] (collectively, “Assignee”); and (3) Hampton Inns Management
LLC, a Delaware limited liability company, and HOMEWOOD SUITES Management LLC, a
Delaware limited liability company, the principal place of business of each of
which is 7930 Jones Branch Drive, Suite 1100, McLean, Virginia 22102
(collectively, “Manager”).

 

RECITATIONS

 

WHEREAS, Assignee is the operating lessee of the Hotels listed on Exhibit A
hereto (collectively, “Hotels”), pursuant to leases (collectively, “Leases”)
between Assignee and the entities listed as “REIT Property Owner Entity” on
Exhibit A hereto (collectively, “Property Owners”), which are the owners of the
respective listed Hotels;

 

WHEREAS, Assignor and Assignee have entered into those certain management
agreements by and between the entities listed as “Owner Management Agreement
Parties” with respect to each Hotel on Exhibit A hereto, dated as of February
27, 2015 (collectively, “Owner Management Agreements”), pursuant to which the
Assignee has, among other things, appointed Assignor as Assignee’s exclusive
agent to supervise, direct, and control management and operation of the Hotels
pursuant to the terms thereof;

 

WHEREAS, Assignor and Manager are parties to those certain Management Agreements
(collectively, “Management Agreements”), dated February 27, 2015 with respect to
the management of the Hotels, as clarified effective January 1, 2016 by that
certain Omnibus 2016 Incentive Fee Implementation;

 

WHEREAS, Assignor, Assignee, Property Owners, and Manager have entered into
those certain Owner Agreements dated as of February 27, 2015 (collectively,
“Owner Agreements”) governing certain rights and obligations as between the
entities listed as “Owner Agreement Parties” with respect to each Hotel on
Exhibit A hereto, in connection with the Leases, the Management Agreements, and
the Owner Management Agreements;

 

WHEREAS, Assignor and Assignee are, contemporaneously with execution of this
Assignment, terminating the Owner Management Agreements, and in connection
therewith, Assignor desires to assign its rights and obligations under the
Management Agreements, Assignee desires to accept the assignment of Assignor’s
rights and obligations under the Management Agreements, as amended by this
Assignment, and Manager desires to acknowledge and consent to such assignment;
and

 

 

 

 

NOW THEREFORE, in consideration of the foregoing recitals and the premises and
the mutual covenants herein contained and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, and
intending to be legally bound, the parties hereto agree as follows:

 

1.Effective as of the Effective Date, Assignor hereby assigns, transfers and
conveys to the applicable Assignee set forth opposite the name of the applicable
Management Agreement on Exhibit B hereto all of Assignor’s rights, title and
obligations in, to and under such Management Agreements, and such Assignee
hereby accepts and assumes all such rights under such Management Agreements and
assumes all obligations and liabilities of Assignor under such Management
Agreements. Manager hereby consents to such assignment and assumption.

 

2.Each of Assignee and Manager agrees that each of the Management Agreements are
hereby amended as follows:

 

a.All references to “Owner” and/or “Lessee” shall hereafter be deemed to refer
to the applicable Assignee set forth opposite the name of the applicable
Management Agreement on Exhibit B hereto. References to both “Owner” and
“Lessee” in any single sentence shall each be deemed to refer to the applicable
Assignee set forth opposite the name of the applicable Management Agreement on
Exhibit B hereto.

 

b.In the fourth line of the Preamble of each of the Management Agreements,
“(hereinafter referred to as “Owner”)” is replaced with “(hereinafter referred
to as “Owner” and/or “Lessee”).

 

c.In the first “Whereas” clause, the following words are deleted: “an Affiliate
(defined below) of [Assignee entity name] (the “Lessee”),”.

 

d.The second “Whereas” clause is deleted in its entirety.

 

e.In the third “Whereas” clause, the reference to the “Owner Management
Agreement” at the end of the sentence is deleted.

 

f.In Section 6.2, the last sentence is deleted.

 

g.The following is added as a new Section 11.2.D. to the Management Agreements
for the Hotels listed under “ENN I” in the “Portfolio Column” of Exhibit A
hereto:

 

2 

 

 

Notwithstanding anything herein to the contrary, in the event that W2007 Equity
Inns Senior Mezz, LLC, or its successor or assign (“Preferred Equity Holder”),
delivers notice to Management Company that a “Changeover Event” has occurred
under the Amended and Restated Limited Liability Company Agreement of ARC
Hospitality Portfolio I Holdco, LLC, dated February 27, 2015, which notice shall
be definitive hereunder as to whether a “Changeover Event” has occurred for
purposes of this Agreement, and upon which Management Company shall be required
and entitled to rely, Preferred Equity Holder may terminate this Agreement by
written notice (which may be incorporated in the initial notice as to the
occurrence of a Changeover Event), effective immediately or upon such later date
as set forth in said notice, without the payment of any termination fee,
penalty, accrued and unpaid Base Management Fees or Incentive Fees or any other
fees, commissions or other amounts payable or reimbursable to Management Company
under this Management Agreement.  The parties hereby agree and acknowledge that
the Preferred Equity Holder shall be an express third party beneficiary of this
Management Agreement and entitled to enforce the provisions hereof in accordance
with the terms set forth herein.  Management Company acknowledges that the
provisions of this Section 11.2.D. were a material component of the
consideration received by Owner for entering into this Agreement.

 

h.The following is added as a new Section 11.2.D. to the Management Agreements
for the Hotels listed under “ENN II” in the “Portfolio Column” of Exhibit A
hereto:

 

Notwithstanding anything herein to the contrary, in the event that W2007 Equity
Inns Senior Mezz, LLC, or its successor or assign (“Preferred Equity Holder”),
delivers notice to Management Company that a “Changeover Event” has occurred
under the Amended and Restated Limited Liability Company Agreement of ARC
Hospitality Portfolio II Holdco, LLC, dated February 27, 2015, which notice
shall be definitive hereunder as to whether a “Changeover Event” has occurred
for purposes of this Agreement, and upon which Management Company shall be
required and entitled to rely, Preferred Equity Holder may terminate this
Agreement by written notice (which may be incorporated in the initial notice as
to the occurrence of a Changeover Event), effective immediately or upon such
later date as set forth in said notice, without the payment of any termination
fee, penalty, accrued and unpaid Base Management Fees or Incentive Fees or any
other fees, commissions or other amounts payable or reimbursable to Management
Company under this Management Agreement.  The parties hereby agree and
acknowledge that the Preferred Equity Holder shall be an express third party
beneficiary of this Management Agreement and entitled to enforce the provisions
hereof in accordance with the terms set forth herein.  Management Company
acknowledges that the provisions of this Section 11.2.D. were a material
component of the consideration received by Owner for entering into this
Agreement.

 

3 

 

 

i.In Section 13.1(b)(i), the last two sentences are deleted.

 

j.In Section 16.9, the “Owner” section is replaced with [insert new contact
information]

 

3.With respect to the Owner Agreements:

 

a.Pursuant to Sections 5(a) and 5(b) thereof, Assignee hereby recognizes
Manager’s rights under the Management Agreements, and agrees that Manager shall
not be named as a party in any eviction or other possessory action or
proceeding, and that Manager shall not be disturbed in its right to manage the
Hotel pursuant to (and subject to the terms of) the Management Agreement; and

 

b.Assignee and Manager acknowledge that this Assignment satisfies Assignee’s
obligations under Section 5(c)(i) thereof.

 

4.Except as specifically modified by this Assignment, all of the provisions of
the Management Agreements are unchanged and continue in full force and effect.
In the event of any conflicts between any Management Agreement and this
Assignment, this Assignment shall control.

 

5.This Assignment is executed by, and shall be binding upon and inure to the
benefit of, the parties hereto and each of their respective administrators,
personal representatives, legal representatives, heirs, successors and permitted
assigns. None of the provisions of this Assignment shall be for the benefit of
or enforceable by any other person.

 

6.This Assignment may not be amended nor may any rights hereunder be waived
except by an instrument in writing signed by the parties sought to be charged
with such amendment or waiver.

 

7.This Assignment may be executed in counterparts, all of which taken together
shall constitute one and the same instrument and each of which shall be deemed
an original instrument as against any party who has signed it. Each party may
execute this Assignment via a facsimile (or transmission of a .pdf file) of this
Assignment. In addition, facsimile or .pdf signatures of authorized signatories
of the parties shall be valid and binding and delivery of a facsimile or .pdf
signature by any party shall constitute due execution and delivery of this
Assignment.

 

[Signatures appear on the following page]

 

4 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
executed and delivered by their duly authorized officers as of the Effective
Date.

 

WITNESS:   ASSIGNOR:           American Realty Capital Hospitality Grace
Portfolio, LLC,     a Delaware limited liability company           By:      
Name:       Title:           WITNESS:   ASSIGNEE:           ARC Hospitality
Portfolio I HIL TRS, LLC, a Delaware limited liability company           By:    
    Name:         Title:         Date:             ARC Hospitality Portfolio I
NTC HIL TRS, LP, a Delaware limited partnership           By: ARC HOSPITALITY
PORTFOLIO I NTC TRS GP, LLC, its general partner           By:         Name:    
    Title:         Date:  

 

 

 

 

    ARC Hospitality Portfolio II HIL TRS, LLC, a Delaware limited liability
company           By:         Name:         Title:         Date:             ARC
Hospitality Portfolio II NTC HIL TRS, LP, a Delaware limited partnership        
  By: ARC HOSPITALITY PORTFOLIO II NTC TRS GP, LLC, its general partner        
  By:         Name:         Title:         Date:         WITNESS:   MANAGER:    
      Hampton Inns Management LLC,     a Delaware limited liability company    
      By:         Authorized Signatory

 

 2 

 

 

    MANAGER:             HOMEWOOD SUITES Management LLC,     a Delaware limited
liability company           By:         Authorized Signatory

  

 3 

 

 

Exhibit A

 

1 

 

  

Exhibit C-5

 

Amended Short-Term Prime Agreement

 

[see attached]

 

 

 

  

EXHIBIT C-5

 

AMENDMENT OF

MANAGEMENT AGREEMENTS

 

This Amendment of Management Agreements (“Amendment”), is entered into as of
________, 2017 (the “Amendment Date”) by and between (1) ARC Hospitality
Portfolio I HIL TRS, LLC, a Delaware limited liability company whose principal
place of business is 405 Park Avenue, New York, NY 10022 and ARC Hospitality
Portfolio I NTC HIL TRS, LP, a Delaware limited partnership whose principal
place of business is 405 Park Avenue, New York, NY 10022 (collectively
hereinafter referred to as “Hilton Pool I Owner”); (2) ARC Hospitality Portfolio
II HIL TRS, LLC, a Delaware limited liability company whose principal place of
business is 405 Park Avenue, New York, NY 10022 and ARC HOSPITALITY PORTFOLIO II
NTC HIL TRS, LP, a Delaware limited partnership whose principal place of
business is 405 Park Avenue, New York, NY 10022 (collectively hereinafter
referred to as “Hilton Pool II Owner”, and together with Hilton Pool I Owner,
“Hilton Owner”); (3) ARC Hospitality Portfolio I MCK TRS, LLC, a Delaware
limited liability company whose principal place of business is 405 Park Avenue,
New York, NY 10022 and ARC Hospitality Portfolio I NTC TRS, LP, a Delaware
limited partnership whose principal place of business is 405 Park Avenue, New
York, NY 10022 (collectively hereinafter referred to as “McKibbon Pool I
Owner”); (4) ARC Hospitality Portfolio II MISC TRS, LLC, a Delaware limited
liability company whose principal place of business is 405 Park Avenue, New
York, NY 10022 and ARC HOSPITALITY PORTFOLIO II NTC TRS, LP, a Delaware limited
partnership whose principal place of business is 405 Park Avenue, New York, NY
10022 (collectively hereinafter referred to as “McKibbon Pool II Owner”, and
together with McKibbon Pool I Owner, “McKibbon Owner”); (5) ARC Hospitality
Portfolio I MISC TRS, LLC, a Delaware limited liability company whose principal
place of business is 405 Park Avenue, New York, NY 10022 (“InnVentures Owner”,
and together with Hilton Owner and McKibbon Owner, “Owner”); and (6) American
Realty Capital Hospitality Grace Portfolio, LLC, a Delaware limited liability
company, whose principal place of business is 405 Park Avenue, New York, NY
10022 (hereinafter referred to as “Manager”).[Final version of document to be
revised to only include those entities and third-party prime management
agreements that need to be amended due to lack of third-party manager
cooperation.]

 

WITNESSETH:

 

WHEREAS, Hilton Pool I Owner and Manager entered into a “Management Agreement”
dated as of February 27, 2015, amended by that certain First Amendment to
Management Agreement (“Hilton Pool I MA First Amendment”) on November 2, 2016
and clarified effective January 1, 2016 by that certain Omnibus 2016 Incentive
Fee Implementation (collectively, the “Hilton Pool I Prime Management
Agreement”) pursuant to which Hilton Pool I Owner engaged Manager to act as
Hilton Pool I Owner’s exclusive agent to supervise, direct, and control
management and operation of those certain hotels fully described on Exhibit A to
the Hilton Pool I Prime Management Agreement (collectively, the “Hilton Pool I
Hotels”) pursuant to the terms thereof;

 

 

 

 

WHEREAS, Pool II Owner and Manager entered into a “Management Agreement” dated
as of February 27, 2015, and clarified effective January 1, 2016 by that certain
Omnibus 2016 Incentive Fee Implementation (collectively, the “Hilton Pool II
Prime Management Agreement”, and together with the Pool I Prime Management
Agreement, the “Hilton Prime Management Agreements”) pursuant to which Hilton
Pool II Owner engaged Manager to act as Hilton Pool II Owner’s exclusive agent
to supervise, direct, and control management and operation of those certain
hotels fully described on Exhibit A to the Hilton Pool II Prime Management
Agreement (collectively, the “Hilton Pool II Hotels”, and together with the
Hilton Pool I Hotels, the “Hilton Hotels”) pursuant to the terms thereof;

 

WHEREAS, McKibbon Pool I Owner and Manager entered into a “Management Agreement”
dated as of February 27, 2015 (the “McKibbon Pool I Prime Management Agreement”)
pursuant to which McKibbon Pool I Owner engaged Manager to act as McKibbon Pool
I Owner’s exclusive agent to supervise, direct, and control management and
operation of those certain hotels fully described on Exhibit A to the McKibbon
Pool I Prime Management Agreement (collectively, the “McKibbon Pool I Hotels”)
pursuant to the terms thereof;

 

WHEREAS, McKibbon Pool II Owner and Manager entered into a “Management
Agreement” dated as of February 27, 2015 (the “McKibbon Pool II Prime Management
Agreement”, and together with the McKibbon Pool I Prime Management Agreement,
the “McKibbon Prime Management Agreements”) pursuant to which McKibbon Pool II
Owner engaged Manager to act as McKibbon Pool II Owner’s exclusive agent to
supervise, direct, and control management and operation of those certain hotels
fully described on Exhibit A to the McKibbon Pool II Prime Management Agreement
(collectively, the “McKibbon Pool II Hotels”, and together with the McKibbon
Pool I Hotels, the “McKibbon Hotels”) pursuant to the terms thereof;

 

WHEREAS, InnVentures Owner and Manager entered into two separate “Management
Agreements”, each dated as of February 27, 2015 (the “InnVentures Prime
Management Agreements”, and together with the Hilton Prime Management Agreements
and the McKibbon Prime Management Agreements, the “Prime Management Agreements”)
pursuant to which InnVentures Owner engaged Manager to act as InnVentures
Owner’s exclusive agent to supervise, direct, and control management and
operation of those certain hotels fully described on Exhibit A to each of the
InnVentures Prime Management Agreements (collectively, the “InnVentures Hotels”,
and together with the Hilton Hotels and the McKibbon Hotels, the “Hotels”)
pursuant to the terms thereof;

 

WHEREAS, Owner and Manager wish to amend the Prime Management Agreements,
effective as of the Amendment Date, in the manner set forth herein.

 

2  

 

 

NOW, THEREFORE, for the mutual covenants and considerations herein contained and
for other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties agree as follows:

 

1.          The Hilton Pool I MA First Amendment is hereby rescinded and is void
ab initio. [This paragraph to be included only if Hilton Prime Management
Agreements are being amended.]

 

2.          Section 9.1 of each of the Hilton Prime Management Agreements and
each of the InnVentures Prime Management Agreements is hereby amended, effective
as of the Amendment Date, by replacing the entire current section with the
following:

 

During each Fiscal Year after the Management Commencement Date (and for a
fraction of any partial Fiscal Year), in consideration of the services Manager
is to render under this Amendment, Manager will be paid a fee (“Base Management
Fee”) at the rate of two percent (2.0%) of Gross Operating Revenues of the Hotel
per Fiscal Year. The Base Management Fee will be paid in installments by
deducting such fee from Gross Operating Revenues of the Hotel immediately
following the submission of the financial statements and schedules pursuant to
Section 7.2 for each Accounting Period at the rate of the corresponding
percentage of Gross Operating Revenues for that Accounting Period. At the end of
each Accounting Period, an adjustment will be made on a cumulative year-to-date
basis, if necessary, and all sums due either the Manager or Owner shall be paid
immediately.

 

3.          Section C. of the Management Fee Rider in each of the McKibbon Prime
Management Agreements is hereby amended, effective as of the Amendment Date, by
replacing the entire current section with the following:

 

During each Fiscal Year after the Management Commencement Date (and for a
fraction of any partial Fiscal Year), in consideration of the services Manager
is to render under this Amendment, Manager will be paid a fee (“Base Management
Fee”) at the rate of two percent (2.0%) of Gross Operating Revenues of the Hotel
per Fiscal Year. The Base Management Fee will be paid in installments by
deducting such fee from Gross Operating Revenues of the Hotel immediately
following each Accounting Period at the rate of the corresponding percentage of
Gross Operating Revenues for that Accounting Period. At the end of each
Accounting Period, an adjustment will be made on a cumulative year-to-date
basis, if necessary, and all sums due either the Manager or Owner shall be paid
immediately.

 

4.          Section 16.9 of each of the Hilton Prime Management Agreements and
each of the InnVentures Management Agreements, and Section 12.10 of each of the
McKibbon Prime Management Agreements, is amended by replacing the notice
information for “Owner” with the following: [insert new notice
addressees/addresses for TRS and for Management Company]

 

3  

 

 

5.          Any capitalized term not specifically defined in this Amendment
shall have the definition given such term in the Prime Management Agreements.

 

6.          This Amendment is executed by, and shall be binding upon and inure
to the benefit of, the parties hereto and each of their respective
administrators, personal representatives, legal representatives, heirs,
successors and permitted assigns. None of the provisions of this Amendment shall
be for the benefit of or enforceable by any other person.

 

7.          This Amendment may not be amended nor may any rights hereunder be
waived except by an instrument in writing signed by the parties sought to be
charged with such amendment or waiver.

 

8.          This Amendment may be executed in one or more counterparts, each of
which shall be deemed an original and it will not be necessary in making proof
of this Amendment or the terms of this Amendment to produce or account for more
than one of such counterparts. All counterparts shall constitute one and the
same instrument. Each party may execute this Amendment via a facsimile (or
transmission of a .pdf file) of this Amendment. In addition, facsimile or .pdf
signatures of authorized signatories of the parties shall be valid and binding
and delivery of a facsimile or .pdf signature by any party shall constitute due
execution and delivery of this Amendment.

 

[Signatures follow on next page]

 

4  

 

 

IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first above written.

 

  MANAGER:       American Realty Capital Hospitality Grace Portfolio, LLC, a
Delaware limited liability company           By:  

    Name:       Title:       Date:  

 

  HILTON OWNER:       Hilton Pool I Owner:     ARC Hospitality Portfolio I HIL
TRS, LLC, a Delaware limited liability company           By:  

    Name:       Title:       Date:  

 

    ARC Hospitality Portfolio I NTC HIL TRS, LP, a Delaware limited partnership
          By: ARC HOSPITALITY       PORTFOLIO I NTC TRS GP,       LLC, its
general partner        

    By:       Name:       Title:       Date:  

5  

 

 

    Hilton Pool II Owner:     ARC Hospitality Portfolio II HIL TRS, LLC, a
Delaware limited liability company               By:  

    Name:       Title:       Date:          

    ARC Hospitality Portfolio II NTC HIL TRS, LP, a Delaware limited partnership
          By: ARC HOSPITALITY       PORTFOLIO II NTC TRS GP,       LLC, its
general partner        

    By:       Name:       Title:       Date:  

 

  MCKIBBON OWNER:       McKibbon Pool I Owner:     ARC Hospitality Portfolio I
MCK TRS, LLC, a Delaware limited liability company           By:  

    Name:       Title:       Date:  

 

    ARC Hospitality Portfolio I NTC TRS, LP, a Delaware limited partnership    
 

    By: ARC HOSPITALITY       PORTFOLIO I NTC TRS GP,       LLC, its general
partner        

    By:       Name:       Title:       Date:  

 

6  

 

 

    McKibbon Pool II Owner:     ARC Hospitality Portfolio II MISC TRS, LLC, a
Delaware limited liability company           By:  

    Name:       Title:       Date:  

 

   

ARC Hospitality Portfolio II NTC TRS, LP, a Delaware limited partnership

          By: ARC Hospitality       PORTFOLIO II NTC TRS GP,       LLC, its
general partner             By:  

    Name:       Title:       Date:  

 

  INNVENTURES OWNER:     ARC Hospitality Portfolio I MISC TRS, LLC, a Delaware
limited liability company      

    By:  

    Name:       Title:       Date:  

 

7  

 

  

Exhibit D-1

 

Asset Assignment Agreement

 

[see attached]

 

 

 

 

Exhibit D-1

 

ASSIGNMENT AND ASSUMPTION AGREEMENT

 

This ASSIGNMENT AND ASSUMPTION AGREEMENT (this “Agreement”) is entered into as
of [•], 2017 (the “Effective Date”), by and among each of American Realty
Capital Hospitality Advisors, LLC (“Hospitality Advisor”) and AR Global
Investment, LLC (“Global” and, together with Hospitality Advisor, “Assignor”),
on the one hand, and Hospitality Investors Trust Operating Partnership, L.P.
(formerly known as American Realty Capital Hospitality Operating Partnership,
L.P.) (the “OP” and, together with the Assignor, the “Parties”), on the other
hand.

 

WITNESSETH:

 

WHEREAS, Assignor holds all right, title and interest to and under each of the
assets set forth on Schedule I attached hereto (the “Assets”);

 

WHEREAS, each of Hospitality Advisor and the Assignee, together with certain
other persons, have entered into that certain Framework Agreement, dated as of
January 12, 2017 (as such agreement may be amended, modified or supplemented,
the “Framework Agreement”); and

 

WHEREAS, in connection with the Closing (as defined in the Framework Agreement),
the Assignee has agreed to acquire, and the Assignor has agreed to assign,
transfer, convey and deliver to the Assignee, all of the Assignor’s rights,
titles and interests in and to all of the Assets.

 

NOW THEREFORE, in consideration of the mutual covenants and promises contained
herein and for other good and valuable consideration the receipt and adequacy of
which are hereby acknowledged, the Parties hereby agree as follows:

 

1.            Assignment and Assumption. Effective as of the date hereof, upon
the terms and subject to the conditions set forth herein:

 

(i)          Assignor hereby assigns, transfers, conveys and delivers to
Assignee, all of Assignor’s rights, titles and interests in and to the Assets,
in each case, free and clear of all liens, pledges, charges, security interests
or other encumbrances of any kind; and

 

(ii)         Assignee hereby (a) acquires all of Assignor’s rights, titles and
interests in and to the Assets in each case, free and clear of all liens,
pledges, charges, security interests or other encumbrances of any kind, and (b)
unconditionally and irrevocably assumes, undertakes and agrees, subject to valid
claims and defenses, to pay, satisfy, perform and discharge in full, as and when
due, and release and discharge Assignee and its successors and assigns
completely and forever from, all obligations and liabilities of any kind arising
out of, or required to be performed under, such Assets, in each case, solely to
the extent arising from and after the date hereof; provided, however, that (x)
it is understood and agreed that no Assignee shall assume any obligation or
claim arising out of the performance of, or failure to perform under, any Asset
to the extent relating to an act or omission prior to the date hereof or to the
extent that such obligation or claim is attributable to any period prior to the
date hereof (the “Retained Liabilities”) (and any third party shall be required
to look solely to Assignor with respect to any claims relating to such Retained
Liabilities), and (y) Assignor hereby agrees to indemnify, reimburse, defend and
hold harmless Assignee, its affiliates and representatives from and against any
and all damages of any kind or nature whatsoever which may be imposed on,
incurred by, or asserted against them, in any way by any third party relating to
or arising out of any Retained Liabilities.

 

 

 

 

2.              Further Assurances. The Parties covenant and agree to take such
actions and execute and deliver such further deeds, assignments or other
transfer documents, in each case, as a Party may reasonably request, to
effectively contribute, transfer, assign and convey, and to evidence such
contribution, transfer, assignment and conveyance of, the Assets (including, in
each case, by causing any of its applicable affiliates to execute such documents
to effectively contribute, transfer, assign and convey, and to evidence such
contribution, transfer, assignment and conveyance of, the Assets).

 

3.              Assignor Representations and Warranties.

 

(i)        Global hereby represents and warrants to Assignee as follows:

 

(a)          Existence and Power. It is a limited liability company duly formed,
validly existing and in good standing under the laws of the State of Delaware
and has all power and authority required to carry on its business as now
conducted.

 

(b)          Authorization. It and each of its applicable subsidiaries, has all
requisite corporate or similar power, authority and legal capacity to execute
and delivery, as applicable, this Agreement and to perform its obligations
hereunder. The execution, delivery and performance of this Agreement have been
duly approved by all requisite action on it and its applicable subsidiaries’
parts. This Agreement has been executed and delivered by it or such affiliate,
as applicable, and, assuming the due authorization, execution and delivery by
the other parties hereto and thereto, constitutes or will constitute a legal,
valid and binding obligation of it and such applicable subsidiaries, enforceable
against each such person in accordance with its terms, subject to the Equitable
Exceptions.

 

(c)          Non-Contravention. The execution, delivery and performance by it of
this Agreement does not and will not, directly or indirectly, (a) violate,
contravene or conflict with any provision of the organizational documents of
such person, (b) contravene or conflict with, or constitute a violation of, any
applicable order or provisions of any applicable law binding upon or applicable
to any such person, (c) require it or any of its respective subsidiaries to make
or obtain any registration, filing, application, notice, consent, approval,
order, qualification, authorization, designation, declaration or waiver with, to
or from any governmental authority or any other person, or (d) require a
consent, approval or waiver from, or notice to, any party to any contract to
which it or any of its respective affiliates (other than ARCH, the OP and their
respective subsidiaries) is a party.

 

(d)          No Liens. The Assets are free and clear of all liens, pledges,
charges, security interests or other encumbrances of any kind.

 

(ii)         Hospitality Advisor hereby represents and warrants to Assignee that
the Assets are free and clear of all liens, pledges, charges, security interests
or other encumbrances of any kind.

 

 

 

 

4.              Entire Agreement. This Agreement (together with the Framework
Agreement and the other documents contemplated thereby) constitutes the entire
agreement and understanding among the Parties in respect of the subject matter
hereof and thereof and supersedes all prior and contemporaneous arrangements,
agreements and understandings, both oral and written, whether in term sheets,
presentations or otherwise among the Parties, or between any of them, with
respect to the subject matter hereof and thereof.

 

5.              Miscellaneous. Sections 11 (Counterparts), 12 (Governing Law;
Specific Performance; WAIVER OF JURY TRIAL), 13 (Severability), 14 (Further
Assurances), 15 (Parties in Interest), 17 (Headings), 18 (Expenses), 19
(Construction), 20 (Assignment) and Section 22 (Amendments and Waivers) of the
Framework Agreement are incorporated herein by reference, mutatis mutandis.

 

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

 

 

 

 

IN WITNESS WHEREOF, the undersigned have executed and delivered this Agreement
as of the date first above written.

 

  ASSIGNOR:       AMERICAN REALTY CAPITAL HOSPITALITY ADVISORS, LLC       By:
American Realty Capital Hospitality Special Limited Partner, LLC, its sole
member       By: American Realty Capital IX, LLC, its sole member       By: AR
Capital, LLC, its sole member       By:     Name: Edward M. Weil, Jr.   Title:
Chief Executive Officer       AR GLOBAL INVESTMENTS, LLC         By:     Name:  
  Title:  

 

 

 

 

  ASSIGNEE:       HOSPITALITY INVESTORS TRUST, OPERATING PARTNERSHIP, L.P.      
By: Hospitality Investors Trust, Inc., its general partner       By:     Name:  
  Title:

 

 

 

 

Schedule I

 

Assets

 

All of the following assets as are relevant to the Hospitality Investors Trust,
Inc., the OP and each of their respective subsidiaries:

 

1.Accounting systems

 

2.Software [NOTE – APPLICABLE SOFTWARE AND ANY RELATED AGREEMENTS TO BE
TRANSFERRED TO BE IDENITFIED]

 

3.IT equipment (excluding all servers owned or leased by the Advisor or its
affiliates, but not the information contained on such servers relating to ARCH
and its subsidiaries)

 

4.[THIRD PARTY CONTRACTS – TO BE IDENITIFED]

 

5.Office furniture and office equipment presently exclusively used by Transition
Personnel (including desks, chairs, office and cellular phones, office and
portable computers, file cabinets)

 

6.[MANAGEMENT TO IDENTIFY OTHER ASSETS]

 

 

 

 

Exhibit D-2

 

Facilities Use Agreement

 

[see attached]

 

 

 

 

EXHIBIT D-2

 

FACILITIES USE AGREEMENT

 

This FACILITIES USE AGREEMENT (this “License”) is entered into as of the [•] day
of [•], 2017, by and between Crestline Hotels & Resorts, LLC, with its principal
place of business at 3950 University Drive, Suite 301, Fairfax, Virginia 22030
(hereinafter referred to as “Licensor”), Hospitality Investors Trust Operating
Partnership, L.P. (formerly known as American Realty Capital Hospitality
Operating Partnership, L.P. and hereinafter referred to as the “Licensee”) and,
solely for purposes of Section 14 and Section 25 hereof, CH Realty III/OldTown
Village, L.L.C. (“Landlord”). Each of Licensor and Licensee is referred to
herein as a “Party” and collectively as the “Parties.”

 

WITNESSETH:

 

WHEREAS, Licensor, Licensee and certain other persons are party to that certain
Framework Agreement, dated as of January 12, 2017, pursuant to which, among
other things, Licensor has agreed to provide to Licensee and its affiliates
access to, and use of, certain of Licensor’s properties and facilities;

 

WHEREAS, Licensor entered into that certain Deed of Lease Agreement, dated as of
November 11, 2015, between Licensor and Landlord for a term ending on August 31,
2026 (the “Master Lease”) pursuant to which Licensor leases from Landlord Unit
0A201 (the “Leased Premises”) in the building located at 3950 University Drive,
Fairfax, Virginia 22030 (the “Building”);

 

WHEREAS, capitalized terms used herein but not defined shall have the meaning
ascribed thereto in the Master Lease;

 

WHEREAS, Licensor and Licensee wish to enter into this License subject to the
applicable terms and provisions of the Master Lease; and

 

WHEREAS, Licensee agrees to the terms set forth herein and agrees to use the
Licensed Space (as defined below) in a manner that is in compliance in all
material respects with the applicable terms and provisions of the Master Lease
(as such terms and provisions are applicable to the Licensed Space) and all
applicable laws.

 

NOW, THEREFORE, in consideration of the premises and covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as set forth herein:

 

 1 

 

 

1              GRANT OF LICENSE; LICENSED SPACE: Licensor hereby grants to
Licensee an irrevocable limited exclusive license during the License Term for
use of, and access to, that certain space in the Leased Premises set forth on
Schedule A attached hereto (the “Licensed Space”). The Licensee acknowledges and
agrees that it shall not take any action that would reasonably be expected to
result in an Event of Default (as defined in the Master Lease) under, or
material breach of the terms of, the Master Lease or otherwise give rise to
termination right in favor of the Landlord under the Master Lease. The Licensee
shall use the Licensed Space in a manner that is in all material respects in
compliance with the applicable terms and provisions of the Master Lease and all
applicable laws. The rights granted in favor of Licensee under this License are
in the nature of a license in respect of the Licensed Space and shall not create
any leasehold or other estate or possessory rights in such Licensed Space,
provided that the Licensor shall use its commercially reasonable efforts to
provide use of, and access to, the Licensed Space to the Licensee and its
affiliates at all times during the License Term, and shall provide the right of
ingress and egress for the purposes of the Licensee’s and its affiliates’ use
of, and access to, the Licensed Space. Any occupancy of the Licensed Space by
Licensee (or an Access Party (as defined below)) after the date of the
expiration of the License Term (as defined below), or any earlier termination of
this License, shall be considered a trespass.

 

2LICENSE TERM:

 

(i)          The term of this License will begin on the date hereof (the “Start
Date”) and (except as otherwise provided) will continue through December 31,
2019, which constitutes the end of the term; provided, however, that such term
shall automatically renew for successive one (1) year periods unless either
Party delivers written notice to the other at least one hundred twenty (120)
days prior the expiration of the initial term or any renewal term (the “License
Term”); provided, further, that in no event shall the License Term extend past
the expiration or earlier termination of the Master Lease. If the Master Lease
is terminated for reasons not relating to Licensor’s default under, or breach of
any of the terms of, the Master Lease, whether by operation of law or otherwise,
Licensor shall not be liable in any manner whatsoever for such termination and
this License shall terminate upon such termination of the Master Lease;
provided, however, that the Licensor shall provide written notice to the
Licensee as promptly as practicable following the Licensor becoming aware that
the Master Lease shall terminate and the estimated date of termination thereof.

 

(ii)         Notwithstanding anything contained herein to the contrary, in the
event either Party proposes to consummate a Change in Control, each Party shall
have the right to terminate this License effective on the later of (i) the date
of consummation of such Change in Control, and (ii) the 120th day following the
provision of written notice (which cannot be delivered later than 30 days
following the date of consummation of such Change in Control) by the terminating
Party to the other Party that the terminating Party intends to terminate this
Agreement in connection with a Change in Control. “Change in Control” means,
with respect to a Party, any transaction or series of transactions (as a result
of a merger, consolidation, purchase of assets, purchase of equity interests or
other similar transaction) that results in (A) any person or “group” (within the
meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended)
(other than such Party or one or more of its affiliates) acquiring beneficial
ownership, directly or indirectly, of fifty percent (50%) or more of the then
issued and outstanding voting securities of such Party, or (B) the sale, lease,
exchange, conveyance, transfer or other disposition (for cash, shares of stock,
securities or other consideration), directly or indirectly, of all or
substantially all of the property or assets of such Party to any person or
“group” (within the meaning of Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended) (other than such Party or one or more of its affiliates);
provided, however¸ that a transaction that results in Barceló Crestline
Corporation acquiring beneficial ownership, directly or indirectly, of fifty
percent (50%) or more of the then issued and outstanding voting securities of
Licensor (or substantially all of the property or assets of Licensor) shall not
be a Change in Control.

 

 2 

 

 

(iii)        The following Sections shall survive termination of this License:
this Section 2, Section 10 (Indemnification), Section 11 (Assignment), Section
13 (Notices), Section 16 (Governing Law), Section 17 (Entire Agreement), Section
19 (Counterparts), Section 20 (Severability), Section 21 (Parties in Interest),
Section 22 (Headings), Section 23 (Expenses) and Section 24 (Construction).

 

3              LICENSE PAYMENTS: During the License Term, Licensee agrees to pay
to Licensor at the address referenced above, or at any other address designated
in writing by Licensor in advance on the first of each calendar month, an
aggregate monthly licensee fee for the Licensed Space in the amount of (i) 65%
multiplied by the sum of (A) the aggregate Rent (as defined in the Master Lease)
payable by Licensor for the applicable calendar month under the Master Lease
(but expressly excluding any security deposit), and (B) the aggregate amounts
incurred by Licensor in respect of Services and Repairs (as defined below) for
the applicable calendar month which are individually billed for the 2nd floor of
the Leased Premises (and which do not include any allocation of expenses or fees
relating to the 3rd floor of the Leased Premises), provided that the Parties
acknowledge and agree that the rental cost for furniture shall be as set forth
on Schedule B hereto, and (ii) 10.86% multiplied by the aggregate amounts
incurred by Licensor in respect of Services and Repairs for the applicable
calendar month which are not individually billed for the 2nd and 3rd floors of
the Leased Premises (i.e., which have a bill that consolidates fees or expenses
for the 2nd and 3rd floors of the Leased Premises); provided, however, that the
first monthly payment shall be due on the date hereof; provided further that, in
the event that the Closing does not occur on the first of a calendar month, then
the applicable monthly Licensee Fee payable on the date hereof shall be prorated
such that the Licensee is only required to pay a pro rata portion of the
Licensee Fee for the period from the date of the Closing to the first day of the
next calendar month. “Services and Repairs” means any costs and liabilities
incurred by Licensor (i) for the services identified on Schedule B hereto, and
(ii) with respect to insurance under Section 14 hereof.

 

4             USE AND ACCESS: Licensee shall use the Licensed Space for the sole
purpose of operating its business of acquiring, holding, owning, developing,
constructing, improving, maintaining, operating, selling, managing, leasing,
encumbering and disposing of and dealing with hotel properties and related
assets and undertaking activities in connection therewith (the “Business”) and
for no other purpose without Licensor’s prior written consent (in its reasonable
discretion). Licensee’s employees, agents, representatives and invitees and
their respective affiliates (each, an “Access Party”) shall have the right to
access the Licensed Space in connection with Licensee’s operation of the
Business. Licensee and each Access Party shall have access to the common areas
of the Building to the same extent enjoyed by Licensor under the Master Lease.
The Licensor shall permit the Licensee to erect, and, if requested by Licensor,
Licensee shall erect, in each case, at Licensee’s sole cost and expense,
non-structural partitions or dividers in the Licensed Premises to reasonably
separate the Licensed Space from other portions of the Leased Premises and/or to
provide security for the Licensee’s files; provided, however, that, in
accordance with Section 7, Licensee shall, at its sole expense, remove such
partitions or dividers at the expiration or earlier termination of the License.

 

 3 

 

 

5              QUIET ENJOYMENT: Licensee shall be entitled to quiet enjoyment of
the Licensed Space, and neither Licensor nor Landlord will interfere with that
right, as long as Licensee pays the License Fee in a timely manner and performs
in all material respects all other obligations under this License (subject to
notice and cure periods). Licensor acknowledges and agrees that (a) it shall not
be permitted to amend or modify any terms or conditions of the Master Lease that
would be applicable to the Licensee or with which the Licensee would be required
to comply without the prior written consent of the Licensee (which consent will
not be unreasonably withheld), and (b) the Licensor shall not take any action
under the Master Lease that would deprive in any material respect the Licensee
of its rights under this License, including with respect to use and enjoyment of
the Licensed Space during the License Term.

 

6              LICENSOR ACCESS TO LICENSED SPACE: Licensor and Licensor’s agents
shall have the right to enter the Licensed Space for any emergency at any time,
and, at other reasonable times during normal business hours and following
reasonable advance notice to the Licensee, to examine the Licensed Space and to
make repairs, replacements, and improvements. Licensor will make reasonable
efforts to notify Licensee in advance of an emergency entry. However, in the
event of emergency, Licensor may enter the space without notice. For the purpose
of right of entry, issues related to telephone connectivity and/or computer
network access is considered an emergency.

 

7              POSSESSION AND SURRENDER OF LICENSED SPACE: Licensee shall be
entitled to possession of the Licensed Space on the first day of the License
Term. At the expiration of this License or upon earlier termination in
accordance with this License, Licensee shall, at its sole cost and expense, (a)
remove (and cause each Access Party to remove) its personal property, equipment
and other goods and effects from the Licensed Space, (b) repair any damage to
the Licensed Space caused by Licensee (or an Access Party) during the License
Term, reasonable wear and tear, damage by fire and the elements excepted, and
(c) otherwise vacate (and cause each Access Party to vacate) the Licensed Space
peaceably and quietly and in as good order and condition as the same were in on
the Start Date, reasonable wear and tear, damage by fire and the elements
excepted. In the event Licensee fails to make the aforementioned repairs as set
forth above and such failure is not cured within thirty (30) days following
written notice by the Licensor to the Licensee, then the Licensor shall have the
right to make said reasonable repairs, charge the Licensee the reasonable and
documented out-of-pocket costs of such repairs, and Licensee shall reimburse
Licensor within thirty (30) days of receipt of invoice. Any property of Licensee
(or of an Access Party) left at the Licensed Space after the expiration or
termination of this License shall be deemed to have been abandoned and the
property of Licensor, to be disposed of as Licensor deems expedient and at
Licensee’s sole cost and expense.

 

 4 

 

 

8              CONDITION OF THE LICENSED SPACE: Licensee hereby accepts the
Licensed Space in its “as is” “where is” “with all faults” condition as of the
Start Date. Licensor shall not be obligated to perform any work or furnish any
materials in, to or about the Licensed Space in order to prepare the Licensed
Space for use or occupancy by Licensee or otherwise. Except as provided in
Section 4, Licensee shall not make any alterations, additions or improvements to
the Licensed Space unless Licensor has given its prior written consent (in its
reasonable discretion).

 

9               SERVICES AND REPAIRS: Solely to the extent that either (a) the
Landlord performs such services for Licensor under the Master Lease, or (b) the
Licensor provides or procures such services for its own benefit at the Leased
Premises, then, in each case, the Licensor agrees to perform, or cause to be
performed, for Licensee during the License Term the Services and Repairs.

 

10INDEMNIFICATION:

 

(i)            Licensee shall indemnify, defend and hold harmless Licensor and
its partners, members, stockholders, other equity holders, directors, officers,
employees and agents (collectively, the “Licensor Indemnified Parties”), from
and against any and all claims, liabilities, costs and expenses of every kind
and nature for which the Licensor Indemnified Parties are not reimbursed by
insurance, including, without limiting the generality of the foregoing,
reasonable attorneys’ fees and expenses, court costs, penalties and fines
incurred in connection with or arising out of any of the following (to the
extent not caused by the bad faith, gross negligence or willful misconduct of
the Licensor Indemnified Parties or any breach of the covenants, representations
or warranties of the Licensor set forth in this Agreement):

 

a.the use or manner of use of the Licensed Space by Licensee or by an Access
Party;

 

b.any injury or damage occurring during the License Term (v) to Licensee or an
Access Party happening in or about the Licensed Space, (w) to any other person
happening in the Licensed Space, (x) to the Licensed Space, (y) to any property
of Licensor or an Access Party happening in or about the Licensed Space or (z)
to any property of Licensor or of any other person, firm, association or
corporation happening in the Licensed Space;

 

c.any default by Licensee in the observance or performance of, or compliance
with any of, the terms, provisions or conditions of this License, including,
such matters relating to obtaining possession of the Licensed Space following
any such default; and

 

d.any holdover by Licensee beyond the License Term.

 

 5 

 

 

(ii)            Licensor shall indemnify, defend and hold harmless Licensee and
its partners, members, stockholders, other equity holders, directors, officers,
employees and agents (collectively, the “Licensee Indemnified Parties”), from
and against any and all claims, liabilities, costs and expenses of every kind
and nature for which the Licensee Indemnified Parties are not reimbursed by
insurance, including, without limiting the generality of the foregoing,
reasonable attorneys’ fees and expenses, court costs, penalties and fines
incurred in connection with or arising out of any of the following (to the
extent not caused by the bad faith, gross negligence or willful misconduct of
the Licensee Indemnified Parties or any breach of the covenants, representations
or warranties of the Licensee set forth in this Agreement):

 

a.any injury or damage to Licensee, Licensor or any other person happening in or
about the Leased Premises (other than the Licensed Space) during the License
Term; and

 

b.any default by Licensor in the observance or performance of, or compliance
with any of, the terms, provisions or conditions of this License.

 

11            ASSIGNMENT: This License shall not be assigned by either party
without the prior written consent of other party. The Licensee shall not
sublease, sublicense or otherwise sublet any portion of the Licensed Space. Any
purported assignment, sublease, hypothecation or transfer in breach of this
Section 11 shall be null and void ab initio.

 

12            Licensee Default. Any one or more of the following events will
constitute an event of default ("Event of Default") by Licensee under this
License:

 

(i)failure or refusal by Licensee to timely pay any amounts hereunder when due
and such failure or refusal continues for fifteen (15) business days after
written notice by Licensor; or

 

(ii)failure or refusal by Licensee to perform or observe any other term,
covenant or provision of this License required to be performed or observed by
Licensee, where such failure continues for thirty (30) days after written notice
by Licensor to Licensee describing such failure or refusal in reasonable detail;
or

 

(iii)the institution in a court of competent jurisdiction of proceedings for
reorganization, liquidation, or involuntary dissolution by Licensee, or for its
adjudication as a bankrupt or insolvent, or for the appointment of a receiver of
the property of Licensee, provided that proceedings are not dismissed, and any
receiver, trustee, or liquidator appointed therein is not discharged within
ninety (90) days after the institution of said proceedings.

 

At any time after an Event of Default has occurred, Licensor shall be entitled
to (i) terminate this License upon providing written notice of such termination
to the Licensee (in which case all amounts payable to the Licensor by the
Licensee under this License as of the date of termination shall be immediately
due and payable by the Licensee on the date of termination), and (ii) suspend
the provision of all Services and Repairs being provided hereunder.

 

 6 

 

 

13            NOTICES: Any notice, report or other communication required or
permitted to be given hereunder shall be in writing, and shall be given by
delivering such notice by hand or by certified mail, return receipt requested,
postage pre-paid, at the following addresses of the parties hereto:

 

Licensee:

 

[______________________]

[_____________________]

[_____________________]

Attention: [_______________________]

Fax: [__________________]

Email: [____________________]

 

With a copy to:

 

[______________________]

[_____________________]

[_____________________]

Attention: [_______________________]

Fax: [__________________]

Email: [____________________]

 

Licensor:

 

Crestline Hotels & Resorts, LLC

3950 University Drive, Suite 301

Fairfax, VA 22030

Attention: Pierre Donahue and James Carroll

Fax: (571) 529-6091 and (571) 529-6090

E-Mail: pierre.donahue@crestlinehotels.com

 

With a copy to:

 

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, New York 10019-6064

Attention: Jeffrey D. Marell, Esq.

Facsimile: (212) 492-0105

Email: jmarell@paulweiss.com

 

Any party may at any time change its address for the purpose of this section by
like notice. Any such notice, demand or communication shall be deemed given or
served, as the case may be, upon delivery of same to such party.

 

 7 

 

 

14            INSURANCE: Licensee shall not be required to obtain insurance
policies in connection with the License. Licensor shall obtain and maintain,
during the License Term, insurance policies and in coverage amounts as are
required by the Master Lease for the Leased Premises (including the Licensed
Space and Licensee’s personal property located at the Licensed Space); provided,
that Licensee shall be named as an “additional insured” under such policies.
Upon request, Licensor shall provide Licensee a certificate of insurance as
proof of insurance coverage.

 

15            POWER AND AUTHORITY: Each of Licensor, Landlord and Licensee each
represent as of the date of this License that it has full power and authority to
enter into this License. Licensee represents that a true, correct and complete
copy of the Master Lease is attached hereto as Schedule C.

 

16GOVERNING LAW:

 

(a)          This License shall be governed by, interpreted under, and construed
and enforced in accordance with, the law of the Commonwealth of Virginia, not
taking into account any rules of conflicts of laws that would cause the
application of the laws of any other jurisdiction.

 

(b)          The parties hereto agree that irreparable damage would occur if any
provision of this License were not performed in accordance with the terms hereof
and that the parties shall be entitled to an injunction or injunctions to
prevent breaches of this License or to enforce specifically the performance of
the terms and provisions hereof, without the need to post any bond or other
security in addition to any other remedy to which they are entitled at law or in
equity.

 

(c)          EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH
RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS LICENSE OR THE TRANSACTIONS CONTEMPLATED BY THIS LICENSE.

 

17            ENTIRE AGREEMENT: This License (together with the Framework
Agreement and the other transaction documents contemplated thereby) constitutes
the entire agreement and understanding among the Parties in respect of the
subject matter hereof and thereof and supersedes all prior and contemporaneous
arrangements, agreements and understandings, both oral and written, whether in
term sheets, presentations or otherwise among the Parties, or between any of
them, with respect to the subject matter hereof and thereof.

 

18            AMENDMENTS AND WAIVERS: Any amendments or addendums to this
License must be executed in writing, signed by the parties agreeing to the terms
therein. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.

 

 8 

 

 

19           COUNTERPARTS: This License may be executed in any number of
counterparts, each of which shall be deemed to be an original, and shall be
effective once this License has been signed by all of the parties and all
signature pages have been attached to one another, it not being necessary for
the parties to have physically signed the same signature pages of this License.
Signatures to this License received via facsimile or email shall be deemed
original signatures.

 

20           SEVERABILITY: If any term, provision, covenant or restriction of
this License is held by a court of competent jurisdiction or other authority to
be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this License shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.

 

21            PARTIES IN INTEREST: Nothing in this License shall create or be
deemed to create any third party beneficiary rights in any person not a party to
this License.

 

22            HEADINGS: The headings and captions herein are inserted for
convenience of reference only and are not intended to govern, limit or aid in
the construction of any term or provision hereof.

 

23            EXPENSES: Except as specifically set forth herein, each Party will
bear its own costs and expenses in connection with this License, including all
fees and expenses of its representatives and advisors.

 

24            CONSTRUCTION: As used in this License, any reference to the
masculine, feminine or neuter gender shall include all genders, the plural shall
include the singular, and the singular shall include the plural. Unless the
context otherwise requires, the term “party” when used in this License means a
Party to this License. References in this License to a Party or other Person
include their respective successors and assigns. The words “include,” “includes”
and “including” when used in this License shall be deemed to be followed by the
phrase “without limitation” unless such phrase otherwise appears. Unless the
context otherwise requires, references in this License to Sections and Schedules
shall be deemed references to Sections of, and Schedules to, this License.
Unless the context otherwise requires, the words “hereof,” “hereby” and “herein”
and words of similar meaning when used in this License refer to this License in
its entirety and not to any particular Section or provision hereof. Except when
used together with the word “either” or otherwise for the purpose of identifying
mutually exclusive alternatives, the term “or” has the inclusive meaning
represented by the phrase “and/or”. With regard to each and every term and
condition of this License, the Parties understand and agree that the same have
or has been mutually negotiated, prepared and drafted, and that if at any time
the Parties desire or are required to interpret or construe any such term or
condition or any agreement or instrument subject thereto, no consideration shall
be given to the issue of which Party actually prepared, drafted or requested any
term or condition of this License. All references in this License to “dollars”
or “$” shall mean United States dollars. Any period of time hereunder ending on
a day that is not a business day shall be extended to the next business day
(with the term “business day” meaning any day, other than a Saturday, Sunday or
other day on which commercial banks in New York, New York are authorized or
required by law to close).

 

 9 

 

 

25            SPECIFIC PERFORMANCE: Each Party acknowledges that money damages
would be both incalculable and an insufficient remedy for any breach of this
License by such Party and that any such breach would cause the other Party
irreparable harm. Accordingly, subject to the next sentence, each Party also
agrees that, in the event of any breach or threatened breach of the provisions
of this License by such Party, the other Party shall be entitled to equitable
relief without the requirement of posting a bond or other security, including in
the form of injunctions and orders for specific performance, in addition to all
other remedies available to such other Party at law or in equity.

 

26             LANDLORD CONSENT: Landlord hereby consents to the execution,
delivery and performance of this License by each of Licensor and Licensee,
including all such consents as may be required pursuant to the terms of the
Master Lease. Furthermore, Landlord hereby acknowledges and agrees that no
amounts shall be owed or payable to Landlord in respect of the License Fee under
Section 9(g) of the Master Lease.

 

[BALANCE OF PAGE INTENTIONALLY LEFT BLANK.]

 

 10 

 

 

IN WITNESS WHEREOF, the parties have executed this License as of the date first
written above.

 

  LICENSOR:       CRESTLINE HOTELS & RESORTS, LLC         By:         Name:    
Title:         LICENSEE:       HOSPITALITY INVESTORS TRUST OPERATING
PARTNERSHIP, L.P.       By: Hospitality Investors Trust, Inc., its general
partner         By:         Name:     Title:         LANDLORD:      
[____________________________]         By:         Name:     Title:

 

 11 

 

 

SCHEDULE A

 

Licensed Space

 

See attached.

 

 12 

 

 

SCHEDULE B

 

SERVICES AND REPAIRS

 

1.Furniture: Use of furniture for a standard office environment and furnishings
such as file cabinets, standard safes/bar locks, white boards, key board tables,
desks, tables and chairs that meet facility standards, and use of artwork for
office areas (not individual offices) and common areas when available in
inventory. The Parties acknowledge and agree that the cost of use of such
furniture and office buildout shall be $3,166.66 per month (i.e., $38,000 per
year, which amount was calculated based upon 65% of the $58,000 annual
depreciation cost for such furniture and buildout with respect to the entire
Leased Premises).

 

2.Mail service: Daily delivery and pick up of internal and external mail at
designated mail centers, including overnight mail, and postage for external
standard business related US mail; provided that priority mail postage costs
(including UPS, Federal Express and Airborne Overnight) are expressly excluded.

 

3.Custodial services: Trash removal for employee work areas, general cleaning of
common areas in the Licensed Space and the Leased Premises (including restrooms,
lobbies and corridors), spot vacuuming and dusting of furniture as necessary,
and pest control as needed.

 

4.Building maintenance: Building maintenance reasonably necessary for operation
of the Licensed Space and the Leased Premises.

 

5.Basic voice telecommunication usage: Access to telecommunication
infrastructure wiring, phone switches and associated equipment.

 

6.Security guards: Standard security guard services.

 

7.Access control: Badging and access control services for employees and visitors
of the Operating Partnership and its subsidiaries.

 

8.Lobby receptionist: Point of contact in main lobby for greeting and badging of
authorized vendors, visitors and employees during regular business hours.

 

9.Utilities: Access to and use of applicable utilities for the Licensed Space,
including electrical, water and sewage.

 

 13 

 

 

SCHEDULE C

 

MASTER LEASE

 

See attached.

 

 14 

 

  

Exhibit D-3

 

Royalty-Free IP License Agreement

 

[see attached]

 

 

 

 

EXHIBIT D-3

 

TRADEMARK LICENSE AGREEMENT

 

This TRADEMARK LICENSE AGREEMENT (the “Agreement”) is made and entered into as
of [●], 2017, by and between AR Capital LLC, a Delaware limited liability
company (“AR Capital”) and American Realty Capital Hospitality Advisors, LLC, a
Delaware limited liability company (the “Advisor” and with AR Capital, the
“Licensor”), on the one hand, and Hospitality Investors Trust, Inc. (formerly
known as American Realty Capital Hospitality Trust, Inc.), a Maryland
corporation (the “Company”) and Hospitality Investors Trust Operating
Partnership, L.P. (formerly known as American Realty Capital Hospitality
Operating Partnership, L.P.) (the “OP” and, together with the Company, the
“Licensee” and, together with the Licensor, the “Parties”), on the other hand.

 

RECITALS

 

WHEREAS, each of Advisor, the Company and the OP, together with certain other
persons, have entered into that certain Framework Agreement, dated as of January
12, 2017 (as such agreement may be amended, modified or supplemented, the
“Framework Agreement”);

 

WHEREAS, Licensor (or its Affiliates, as defined below) owns certain rights,
title and interest in and to certain trademarks, tradenames, service marks,
logos and domain names, including “American Realty Capital”, “ARC” and “AR
Capital” in connection with real estate investment activities;

 

WHEREAS, pursuant to that certain Advisory Agreement, by and among Licensee,
Advisor and the OP, dated as of January 7, 2014 (as amended, the “Advisory
Agreement”), Licensee received a limited license to use the names “American
Realty Capital”, “ARC” and “AR Capital”;

 

WHEREAS, pursuant to the Advisory Agreement, Licensee also received certain
administrative functions related to the operation of Licensee’s business,
including the operation and maintenance of the website found at the domain name
www.archospitalityreit.com, including all sub-domains thereof (the “Website”);

 

WHEREAS, Licensee desires to obtain (i) a limited royalty-free license from
Licensor to use “American Realty Capital”, “ARC” and “AR Capital” in the conduct
of Licensee’s business as Licensee discontinues any use of Licensor’s Marks (as
defined below) and (ii) the control of the operation of the Website solely for
the duration of the Term (as defined below); and

 

WHEREAS, Licensor and Licensee wish to set forth herein the terms and conditions
with respect to the licensing of the Marks and operation and control of the
Website by Licensee solely during the Term, including the utilization by
Licensee of the Marks, and the utilization and reference by Licensee of and to
related trademarks and service marks of Licensor that contain the Marks.

 

 

 

 

NOW THEREFORE, in consideration of the premises and covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as set forth herein.

 

DEFINED TERMS

 

Defined terms in the recitals and the preamble to this Agreement are used as so
defined and, as used in this Agreement, the following terms shall have the
following meanings:

 

“Affiliate” shall mean with respect to any Person, (i) any other Person directly
or indirectly owning, controlling or holding, with the power to vote, ten
percent (10%) or more of the outstanding voting securities of such Person; (ii)
any other Person ten percent (10%) or more of whose outstanding voting
securities are directly or indirectly owned, controlled or held, with the power
to vote, by such Person; (iii) any other Person directly or indirectly
controlling, controlled by or under common control with such Person; (iv) any
executive officer, director, trustee or general partner of such Person; and (v)
any legal entity for which such Person acts as an executive officer, director,
trustee or general partner. For purposes of this definition, the terms
“controls,” “is controlled by,” or “is under common control with” shall mean the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of an entity, whether through ownership or voting
rights, by contract or otherwise.

 

“Marks” shall mean the trademarks and service marks set forth on Schedule A
hereto and only those variations and translations thereof requested by Licensee
and approved in writing by Licensor.

 

“Term” shall have the meaning as set forth in Section 2 herein.

 

“Territory” shall mean throughout the world or worldwide.

 

All capitalized terms used herein and not otherwise defined herein shall have
the meanings ascribed thereto in the Advisory Agreement.

 

OPERATIVE PROVISIONS

 

1)GRANT

 

Licensor hereby grants to Licensee and each of Licensee’s Affiliates, solely for
the Term and within the Territory, subject to the terms and conditions herein, a
limited, nonexclusive, non-transferable, non-sublicensable, royalty-free, fully
paid-up, right and license to use the Marks in connection with Licensee’s
existing business in order for Licensee and its Affiliates to transition to the
use of new trademarks. Without limiting the foregoing, Licensor also agrees that
Licensee and its Affiliates may use the Marks on the Website and in connection
with its operation of the Website, provided that all such uses shall be in
accordance with the terms of this Agreement.

 

2)TERM AND LICENSE

 

a)   The “Term” of this Agreement shall commence on the date hereof and shall
continue for ninety (90) calendar days, at which point this Agreement and the
license described herein shall expire, unless earlier terminated pursuant to
Section 8.

 

 2 

 

 

b)   Upon the expiration of the Term or the earlier termination of the Agreement
pursuant to Section 8, all rights granted to Licensee and its Affiliates by
Licensor hereunder shall automatically revert to Licensor. Except as otherwise
expressly provided herein, Licensee and its Affiliates shall cease the use of
any materials or names bearing or incorporating the Marks or any similar
derivation thereof.

 

c)   Prior to expiration of this Agreement, or within five (5) days of the
termination of this Agreement if this Agreement is terminated pursuant to
Section 8(a)(ii), Licensee and its Affiliates shall effect a change of their
corporate names to names that do not include, and are not confusingly similar
to, the Marks and shall promptly provide evidence of such name changes to
Licensor. In no event shall Licensee or its Affiliates use the Marks and any
other name confusingly similar thereto after the expiration or termination of
this Agreement in a manner likely to cause confusion, or to cause mistake or to
deceive as to the affiliation, connection, or association of Licensor, or as to
the origin from, sponsorship by or approval by Licensor of Licensee’s products
or services. Notwithstanding the foregoing or anything to the contrary contained
in this Agreement, Licensee and its Affiliates shall be able to continue to
utilize the Marks solely in the names of any subsidiaries of the Licensee after
the expiration of the Term for an additional thirty (30) days solely to the
extent Licensee is not able to obtain any material third party consent with
respect to the change in name to any such subsidiary prior to the expiration of
the Term. Licensee and its Affiliates shall use commercially reasonable efforts
to obtain all such consents prior to the expiration of the Term.

 

d)   Notwithstanding the foregoing or anything to the contrary contained in this
Agreement, Licensee and its Affiliates shall be able to continue to reference
the Marks in a historical context as the former names of the Licensee and its
subsidiaries and in the names of such entities pursuant to contracts existing
prior to the date hereof (and such references shall not be deemed to be in
breach or violation of this Agreement or the rights of the Licensor to the
Marks).

 

e)   Other than as expressly provided herein, nothing in this Agreement shall be
construed or interpreted to mean that Licensee or its Affiliates are the owners
of any specific right, title or interest to any trademark, service mark, term,
name, logo, symbol, device, or trade dress, or any combination thereof, or other
intellectual property.

 

3)RESERVATION OF RIGHTS

 

Licensor reserves all rights in connection with the Marks, now known or
hereafter developed, that are not expressly granted to Licensee herein.

 

4)WEBSITE OBLIGATIONS

 

a)   As of the date hereof and for the Term, Licensee and its Affiliates shall
have the right (but not the obligation) to host, operate, maintain, and provide
the technology and other related functions and services for the Website. If
Licensee or any of its Affiliates elects to operate the Website, Licensee and
its Affiliates shall use commercially reasonable efforts to operate the Website
in a manner that ensures that the Website is compliant in all material respects
with all “safe harbors” provided under the Communications Decency Act and
Digital Millennium Copyright Act, and similar laws designed to minimize
liability of websites and interactive properties for third party content.

 

 3 

 

 

b)   In the event that the Licensee or any of its Affiliates elects to operate
the Website, then Licensee and its Affiliates shall operate the Website such
that Licensee remains in compliance in all material respects with all applicable
laws, rules and regulations relating to the operation of the Website.

 

5)TRADEMARK OWNERSHIP AND PROTECTION

 

a)   All ownership rights, title and interest in the Marks, including any
goodwill generated in connection with Licensee’s use of the Marks in the
Territory, shall at all times vest in Licensor.

 

b)   Nothing contained in this Agreement shall be construed to confer upon
Licensee or its Affiliates, or to vest in Licensee or its Affiliates, any right
of ownership to the Marks. At no time shall Licensee or its Affiliates directly
or indirectly attempt to register or cause to be registered any rights in the
Marks in the Territory. Moreover, at no time shall Licensee or its Affiliates
directly or indirectly attempt to register or cause to be registered in the
Territory any names, logos or other materials identical or substantially or
confusingly similar to the Marks without the prior written approval of Licensor.
It is understood and agreed that Licensee and its Affiliates shall not acquire
and shall not claim any title to the Marks by virtue of the license granted to
Licensee and its Affiliates or through Licensee’s and its Affiliates’ use of the
Marks. Licensee and its Affiliates further acknowledge the validity of the
Marks, and agree not to institute or participate in any proceedings which
challenge the validity of, or Licensor’s ownership of, the Marks.

 

6)QUALITY CONTROL; TRADEMARK APPROVALS

 

a)   Licensee and its Affiliates shall at all times throughout the Term use the
Marks in a manner materially consistent with the uses made by it prior to the
date hereof and shall only use the Marks in connection with the provision of
services of a quality at least as high as those offered by Licensor prior to the
date hereof.

 

b)   Licensee and its Affiliates shall neither do nor permit to be done any act
or thing which would have a material adverse effect on a Mark or materially
reduce the value of a Mark or detract from its reputation. Licensor shall have
the right to request in writing that Licensee or any of its Affiliates cease a
particular use of any trademark, service mark, term, name, logo, symbol, device,
or trade dress, or any combination thereof, which features the Marks, and
Licensee and its Affiliates must comply with that request within five (5) days,
if in Licensor’s reasonable opinion such use, component or feature would
materially denigrate or otherwise have an adverse effect on the Mark.

 

c)   Licensee and its Affiliates shall comply in all material respects with all
applicable laws and regulations and obtain all necessary or appropriate
government approvals and permits pertaining to the business activities it seeks
to engage in under the Marks.

 

7)REPRESENTATIONS, WARRANTIES AND COVENANTS

 

a)Licensee represents, warrants and covenants on behalf of itself and its
Affiliates that:

 

 4 

 

 

i)this Agreement is a legal, valid and binding obligation of the Licensee; and

 

ii)Licensee has full power and authority to enter into, and perform its
obligations under, this Agreement in accordance with its terms.

 

b)Licensor represents, warrants and covenants that:

 

i)this Agreement is a legal, valid and binding obligation of the Licensor; and

 

ii)Licensor has full power and authority to enter into, and perform its
obligations under, this Agreement in accordance with its terms; and

 

iii)Neither Licensor nor any of its Affiliates makes any representation or
warranty, express or implied, with respect to the Marks licensed hereunder or
the use thereof (including without limitation as to whether the use of the Marks
will be free from infringement of the intellectual property rights of third
parties). Notwithstanding the preceding, Licensor represents and warrants that
it is not aware of any pending claims or litigation or of any claims threatened
in writing regarding the use or ownership of the Mark.

 

c)   Licensee shall be responsible and liable to Licensor for: (i) the use of
the Marks by its Affiliates and their compliance with the provisions of this
Agreement and (ii) any acts and omissions of any of Licensee’s Affiliate as if
Licensee itself had performed those acts or made those omissions.

 

8)TERMINATION; EFFECT OF TERMINATION

 

a)   In addition to any and all other remedies available to it hereunder,
Licensor shall have the right to immediately terminate this Agreement, including
the license to use the Marks as set forth in this Agreement, upon written notice
to Licensee upon the occurrence of the following:

 

i)Licensee’s or an Affiliates’ failure to cease using any trademark, service
mark, term, name, logo, symbol, device, or trade dress, or any combination
thereof, featuring the Marks, within five (5) days of receipt of written notice
provided by Licensor of a material breach of Section 5(b); or

 

ii)Licensee’s or its Affiliates’ material breach of any provision of this
Agreement, which remains uncured by Licensee or such Affiliate after ten (10)
days of receipt of written notice provided by Licensor.

 

b) In the event that the license to use the Marks is terminated pursuant to this
Section 8, Licensee and its Affiliates shall completely cease use of the Marks,
and all related logos and designs, including in relation to the Website, within
five (5) days of such termination.

 

 5 

 

 

9)LIMITATION OF LIABILITY

 

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN AND TO THE MAXIMUM
EXTENT ALLOWED BY APPLICABLE LAW, IN NO EVENT SHALL EITHER PARTY OR ITS
AFFILIATES BE LIABLE FOR ANY LOSS OF PROFITS, LOSS OF BUSINESS, LOSS OF USE OR
DATA, OR INTERRUPTION OF BUSINESS, OR FOR ANY INDIRECT, SPECIAL, INCIDENTAL,
PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND RELATED TO OR ARISING OUT OF THIS
AGREEMENT, HOWEVER CAUSED, ON ANY THEORY OF LIABILITY, WHETHER OR NOT THE OTHER
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

 

10)LAW AND JURISDICTION

 

The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of New York as at the time in effect,
without regard to the principles of conflicts of laws thereof.

 

11)NOTICES

 

Any notice, report or other communication (each a “Notice”) required or
permitted to be given hereunder shall be in writing and shall be given by being
delivered by hand, by courier or overnight carrier or by registered or certified
mail to the addresses set forth below:

 

To the Licensee:[______________________]

[_____________________]

[_____________________]

Attention: [_______________________]

Fax: [__________________]

Email: [____________________]

 

with a copy to:

 

[______________________]

[_____________________]

[_____________________]

Attention: [_______________________]

Fax: [__________________]

Email: [____________________]

 

To the Licensor:American Realty Capital Hospitality Advisors V, LLC

405 Park Ave., 14th Floor

New York, NY 10022

Attention: Jesse Charles Galloway

Facsimile: (646) 861-7804

Email: jgalloway@ar-global.com

  

 6 

 

 

with a copy to:

 

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, New York 10019-6064

Attention: Jeffrey D. Marell, Esq.

Facsimile: (212) 492-0105

Email: jmarell@paulweiss.com

 

Any party may at any time give Notice in writing to the other parties of a
change in its address for the purposes of this Section 11.

 

12)SEVERABILITY

 

The provisions of this Agreement are independent of and severable from each
other, and no provision shall be affected or rendered invalid or unenforceable
by virtue of the fact that for any reason any other or others of them may be
invalid or unenforceable in whole or in part.

 

13)ENTIRE AGREEMENT

 

This Agreement (together with the Framework Agreement and the transaction
documents contemplated thereby) contains the entire agreement and understanding
among the parties hereto with respect to the subject matter hereof, and
supersedes all prior and contemporaneous agreements, understandings, inducements
and conditions, express or implied, oral or written, of any nature whatsoever
with respect to the subject matter hereof. The express terms hereof control and
supersede any course of performance or usage of the trade inconsistent with any
of the terms hereof.

 

14)WAIVERS, REMEDIES

 

Neither the failure nor any delay on the part of a party to exercise any right,
remedy, power or privilege under this Agreement shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, remedy, power or
privilege preclude any other or further exercise of the same or of any other
right, remedy, power or privilege, nor shall any waiver of any right, remedy,
power or privilege with respect to any occurrence be construed as a waiver of
such right, remedy, power or privilege with respect to any other occurrence. No
waiver shall be effective unless it is in writing and is signed by the party
asserted to have granted such waiver.

 

15)ASSIGNMENT; CHANGE OF CONTROL

 

This Agreement may be assigned by the Licensor without obtaining the approval of
Licensee. This Agreement shall not be assigned by the Licensee without the
consent of the Licensor, except in the case of an assignment by the Licensee to
a Person which is a successor to all the assets, rights and obligations of the
Licensee, in which case such successor Person shall be bound hereunder and by
the terms of said assignment in the same manner as the Licensee is bound by this
Agreement.

 

 7 

 

 

16)Further Assurances

 

Licensee shall take, and, as applicable, shall cause any of its Affiliates to
take, such actions and execute and deliver to Licensee such documents as
Licensor may reasonably request, and do all such other actions and things as may
be reasonably requested by Licensee in order to carry out the purposes of this
Agreement.

 

17)UNIQUE LICENSE

 

Licensee further agrees and acknowledges that, in addition to all other rights
that Licensor may have, Licensee acknowledges that its failure to perform any of
the material terms or conditions of this Agreement shall result in immediate and
irreparable damage to Licensor. Licensee recognizes that Licensor’s remedy at
law for any breach or alleged breach of this Agreement arising from Licensee’s
use or threatened use of the Marks inconsistent with the terms of this Agreement
will be inadequate and, accordingly, in addition to such other remedies that may
be available to Licensor at law or equity, Licensee further acknowledges and
agrees that Licensor shall be entitled as a matter of right without further
notice to Licensee, to obtain injunctive relief and/or other equitable relief,
against any threatened, potential or actual breach by Licensee of any of the
provisions, without the posting of a bond or other security.

 

18)SURVIVAL

 

Sections 5, 8-17, and this Section 18 shall survive the termination of this
Agreement, as shall any other of the provisions of this Agreement that by their
terms or by implication are to have continuing effect after any such expiration
or termination.

 

[SIGNATURE PAGES FOLLOW]

 

 8 

 

 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.

 

  LICENSOR:       AMERICAN REALTY CAPITAL HOSPITALITY ADVISORS, LLC       By:
American Realty Capital Hospitality Special Limited Partner, LLC, its sole
member       By: American Realty Capital IX, LLC, its sole member       By: AR
Capital, LLC, its sole member         By:     Name: Edward M. Weil, Jr.   Title:
Chief Executive Officer         AR GLOBAL INVESTMENTS, LLC         By:     Name:
    Title:  

 

[Signature Page to Trademark License Agreement]

 

 

 

 

  LICENSEE:       HOSPITALITY INVESTORS TRUST OPERATING PARTNERSHIP, L.P.      
By: Hospitality Investors Trust, Inc., its general partner         By:      
Name:       Title:         HOSPITALITY INVESTORS TRUST, INC.         By:    
Name:       Title:  

 

[Signature Page to Trademark License Agreement]

 

 

 

 

Schedule A

 

American Realty Capital

 

ARC

 

AR Capital

 

ARC Hospitality

 

ARCH Hospitality Trust

 

American Realty Capital Hospitality Trust, Inc.

 

American Realty Capital Hospitality Operating Partnership, L.P.

 

 

 

 

Exhibit D-4

 

Transferred Employee Waiver and Release

 

[see attached]

 

 

 

 

EXHIBIT D-4

 

SEPARATION AGREEMENT

 

THIS SEPARATION Agreement (this “Agreement”), by and among [_________________]
(“Employee” or “you”) and AR Global Investments, LLC and ARC Advisory Services,
LLC (collectively, the “Company” or “Employer”) is dated as of [•], 2017. Except
as set forth in Section 12 below, this Agreement terminates the letter agreement
between you and the Company dated [•], together with all prior versions and
amendments thereto (the “Employment Agreement”).

 

1.        SEPARATION Date. You hereby acknowledge that (i) your employment with
the Company and the Employment Agreement are hereby terminated by mutual
agreement effective as of the date hereof and your last day of employment is the
date hereof (the “Separation Date”) and (ii) you have mutually agreed with
Hospitality Investors Trust, Inc. (formerly known as American Realty Capital
Hospitality Trust, Inc.) (the “REIT”) to commence employment with the REIT
beginning on the date that is no later than five (5) business days after the
Separation Date. From and after the Separation Date, you shall not represent
yourself as being an employee, officer, agent or representative of the Company
or any of its affiliates or related entities for any purpose (provided that, for
purposes of this Agreement, neither the REIT nor any of its subsidiaries shall
constitute an affiliate or related entity of the Company). You will be paid by
the Company for all accrued salary, bonus and accumulated paid time off through
the Separation Date. You will not earn any salary, bonus or other compensation
following the Separation Date other than as set forth below in Section 2. Your
medical benefits from the Company will end on the date hereof. For purposes of
any restricted stock grants, the termination of your employment and the
Employment Agreement hereunder is deemed to be “without cause” and therefore
such restricted stock grants shall become fully vested on the date hereof.

 

2.        Consideration. In exchange for your agreement to the terms and
conditions in this Agreement, including and subject to the execution and
delivery of the release and waiver of claims provided in Exhibit 1 hereto (the
“Release”), the Company hereby agrees to provide the following additional
consideration and benefits, which you acknowledge and agree exceed any payment,
benefit, or other thing of value to which you might otherwise be entitled under
any policy, plan or procedure of the Company and/or any agreement between you
and the Company:

 

a.         The Company will accelerate and pay (subject to any applicable
withholding required by applicable law) (x) your bonus with respect to fiscal
year 2016 (in the amount of $___) , (y) your 401(k) plan match with respect to
fiscal year 2016 (in the amount of $___), and (z) a pro rata portion of your
bonus with respect to fiscal year 2017 for the portion of 2017 elapsed through
the Separation Date (in the amount of $___); and

 

b.        Your employment with the REIT (or any successor thereto by merger,
transfer or otherwise) shall not be deemed a violation at any time of the
non-competition or non-contract provisions in Section [3] of the Employment
Agreement.

 

Other than the foregoing, no other payments, incentives or benefits shall be
paid. It is understood and agreed that if you fail to comply with the terms of
this Agreement, including any of your covenants in this Agreement (which include
the covenants in the Employment Agreement that continue in full force and effect
in accordance with Section 12 below), the Company shall have no further
obligation to provide you with any additional payments, commissions or benefits
and you agree to return to the Company all payments you have received from the
Company.

 

3.         Confidentiality of Agreement. You agree that you will keep
confidential and not disclose the terms and conditions of this Agreement to any
person or entity without the prior written consent of the Company, except to
your financial advisor(s), attorney(s) and/or spouse (provided that you first
inform them of the confidentiality of this Agreement and they agree to maintain
its confidentiality) and the REIT and its representatives. Nothing in this
Agreement prohibits the Employee from reporting possible violations of federal
law or regulation to any governmental agency or entity, including but not
limited to the U.S. Department of Justice, the U.S. Securities and Exchange
Commission, the U.S. Congress, and any agency Inspector General, or making other
disclosures that are protected under the whistleblower provisions of federal law
or regulation.

 

 

 

 

The Employer acknowledges and agrees that Employee does not need the prior
authorization of Employer to make any such reports or disclosures and Employee
is not required to notify the Employer that it may make or has made such reports
or disclosures.

 

4.        Non-Admission of Wrongdoing. This Agreement is not intended, and shall
not be construed, as an admission by you or by the Company or any of its
affiliates or related entities (which, together with the Company, are referred
to below as the "Company Entities") that you or any of the Company Entities have
violated any federal, state or local law (statutory or decisional), ordinance or
regulation, breached any contract or policy, or committed any wrong whatsoever
against the other party. 

 

5.         Non-competition and restrictive covenant affirmation. You hereby
acknowledge, agree and affirm that non-competition and other restrictive
covenants set forth in your Employment Agreement, the Non-Compete Release
Agreement and the Employee Confidentiality and Non-Competition Agreement shall
continue in full force and effect in accordance with their respective terms
other than as expressly modified herein or in the Non-Compete Release Agreement.

 

6.        non-disparagement. You agree that you will not disparage or encourage
or induce others to disparage the entities and persons listed on Exhibit 2
attached hereto. The Company shall and shall direct its senior management team
(specifically, Messrs. Schorsch, Kahane, Budko and Weil) and their families not
to disparage or encourage or induce others to disparage you. For the purposes of
this Agreement, the term “disparage” includes the making of false, defamatory or
derogatory comments that could reasonably be expected to damage the reputation
of you or the Company Entities (or any of their officers, executives, or
personnel); provided, however, that nothing in this Agreement shall restrict
communications protected as privileged under federal or state law to testimony
or communications ordered and required by a court or an administrative agency of
competent jurisdiction.

 

7.        RETURN OF COMPANY EQUIPMENT, DOCUMENTS AND INFORMATION. You will
promptly return to the Company all Company documents, data, intellectual
property and information (whether in hard copy, electronic, or any other form)
that you received from the Company or created or received in connection with
your employment with the Company and that relate solely to the Company (and not
to the REIT or any of its subsidiaries). You further agree to delete or destroy
any and all copies of such documents, data, intellectual property or information
on or before the Separation Date that may be stored on any computing device or
data storage mechanism in your possession, custody or control.

 

8.        Material Breach. Any breach of the provisions of Sections 3, 6, and/or
7 above, shall be considered a material breach of this Agreement. In the event
that you have committed a material breach of this Agreement, you:

 

a.        consent to the entry of injunctive relief against yourself, and the
cessation by the Company of any further payments to you, in addition to the
Company’s right to pursue any and all of their remedies under the law and under
this Agreement. You further understand and agree that all of the Company
Entities other than the Company itself are third-party beneficiaries under this
Agreement, and each may, on its own or together with other Company affiliates,
obtain injunctive relief without the posting of a bond; and

 

b.        agree that, in the event any Company Entity pursues legal remedies
against you, you shall pay and reimburse the relevant Company Entity for its
attorneys’ fees and costs incurred in any such civil action in court to enforce
their rights under this Agreement in the event that the Company Entity is the
prevailing party in such action.

 

9.        NOTIFICATION OF THIRD PARTIES. Employee and the Company hereby agree
to jointly notify any third parties which Employee was working with on behalf of
the Company prior to the Separation Date.

 

 

 

 

10.        Binding Effect. This Agreement is binding upon, and shall inure to
the benefit of, the parties and their respective heirs, executors,
administrators, successors and assigns, including the successors and assigns of
the Company Entities.

 

11.        Governing Law and Enforcement. This Agreement shall be construed and
enforced in accordance with the laws of the State of New York without regard to
the principles of conflicts of law. Additionally, any action to enforce the
terms of this Agreement shall be commenced exclusively in the federal or state
courts in New York County in the City and State of New York. Both parties
consent to the exclusive jurisdiction of the federal and state courts in New
York County, agree not to seek to transfer or remove the action to another
court, waive any claim under the doctrine of forum non conveniens, and waive
their right to a trial by jury.

 

12.        Entire Agreement. You understand that this Agreement (together with
the Omnibus Waiver and Release Agreement executed by you on or prior to the date
hereof (the “Non-Compete Release Agreement”)) constitutes the complete
understanding between the Company and you, and, supersedes any and all
agreements, understandings, and discussions, whether written or oral, between
you and any of the Company Entities, and provided that (a) if there is a
conflict between this Agreement and the Employment Agreement, the terms of this
Agreement shall govern, and (b) the Employee Confidentiality and Non-Competition
Agreement between the Employee and Company shall continue in full force and
effect except as modified by the overlapping provisions herein, and (c) in the
event of any conflict between this Agreement, the Non-Compete Release Agreement
and the Employee Confidentiality and Non-Competition Agreement, then the terms
of the Non-Compete Release Agreement shall govern. Furthermore, no modifications
shall be made to this Agreement, unless such modification is made in writing and
signed by both the Company and you. 

 

13.        Effective Date; ACKNOWLEDGEMENTS. If you do not sign this Agreement
and execute and deliver the Release, you will be deemed not to have accepted the
terms of this Agreement or the Release, and (i) no further action will be
required of the Company under any section of this Agreement or Release, (ii)
your termination of employment will still be effective as of the Separation
Date, and (iii) you will remain subject to your agreements and covenants set
forth in the Employment Agreement and Employee Confidentiality and
Non-Competition Agreement. You acknowledge that you: (a) have carefully read
this Agreement in its entirety; (b) have had an opportunity to consider the
terms; (c) have had an opportunity to consult with an attorney of your choice
before signing this Agreement; (d) fully understand the significance of all of
the terms and conditions of this Agreement; and (e) agree to abide by all the
terms and conditions contained herein.

 

14.        HEADINGS. The parties agree that the Paragraph headings in this
Agreement are for reference purposes only and do not limit in any way the
meaning of the language in each Paragraph.

 

15.        MISCELLANEOUS. This Agreement may be executed in counterparts, each
of which will be deemed an original, and, when executed by all parties to this
Agreement, will constitute one and the same instrument. Facsimile and email
transmissions of this Agreement signed by any party hereto will be deemed an
original counterpart and binding.

 

[Remainder of Page Intentionally Left Blank]

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have approved, executed and delivered
this Agreement as of the dates set forth below:

 

Print Name: [_________________]   Date:     Employee                 Signature:
       

 

AR Global Investments, LLC                   By:     Date:     Print Name:      
    Title:                   ARC Advisory Services, LLC                   By:  
  Date:     Print Name:           Title:        

 

 

 

 

Exhibit 1

 

General WAIVER AND Release of All Claims

 

a.        Subject to the limitations in sub-paragraph (b) below, in
consideration for the payment and other benefits to be provided to
[_________________] (“Employee”) pursuant to the attached separation agreement,
Employee, for himself and for his heirs, executors, administrators, trustees,
legal representatives and assigns (hereinafter referred to collectively as
“Releasors”), forever releases and discharges AR Global Investments, LLC and ARC
Advisory Services, LLC (collectively the “Company”) and the Company’s
subsidiaries, divisions, affiliates, parent entities, and related business
entities, and with respect to each of them, their predecessors, successors and
assigns, employee benefit plans or funds, and with respect to each such entity,
all of its or their past, present and/or future directors, officers, attorneys,
fiduciaries, agents, trustees, administrators, employees and assigns, whether
acting on behalf of the Company or in their individual capacities (which
collectively, including the Company, are referred to below as the “Company
Releasees”) from any and all claims, demands, causes of action, fees and
liabilities of any kind whatsoever, whether known or unknown, which Employee
ever had, now has, or may have against any of the Company Releasees by reason of
any act, omission, transaction, practice, plan, policy, procedure, conduct,
occurrence, or other matter, up to and including the Separation Date as defined
in the Agreement to which this Exhibit 1 is attached, including but not limited
to claims for, under, or based on: (i) Title VII of the Civil Rights Act of
1964; (ii) the Americans with Disabilities Act; (iii) any claims under Sections
1981 through 1988 of Title 42 of the United States Code; (iv) the Employee
Retirement Income Security Act of 1974; (v) the National Labor Relations Act;
(vi) Sections 503 and 504 of the Rehabilitation Act of 1973; (vii) the New York
State Human Rights Law and the New York City Administrative Code; (viii) all
other federal, state and local fair employment and civil rights laws; (ix) all
other statutes, ordinances, and laws as well as executive orders, judicial
decisions and constitutions, (x) breach of contract (express or implied),
retaliation, wrongful discharge, detrimental reliance, defamation, emotional
distress, and/or compensatory and/or punitive damages; and (xi) attorneys' fees,
costs, disbursements and/or the like.

 

b.        Claims Not Released. Notwithstanding the foregoing, Employee is not
waiving or releasing claims that relate to: (i) the enforcement of the Agreement
to which this waiver and release is attached (including the right to payments
contemplated thereby); (ii) any rights or claims that cannot be released as a
matter law; (iii) the enforcement of the Non-Compete Release Agreement; or (iv)
any right of such Employee to indemnification by any Company Releasee under such
Company Releasee’s constituent documents or by contract.

 

Employee           [_________________]   Date:    

 

 

 

 

Exhibit 2

 

Non-Disparagement Persons

 

1.AR Global Investments, LLC and AR Capital, LLC and their respective direct and
indirect subsidiaries

 

2.Nicholas Schorsch

 

3.William Kahane

 

4.Peter Budko

 

5.Edward M. Weil, Jr.

 

6.Brian Block

 

7.Nicholas Radesca

 

8.Nicholas Schorsch Jr.

 

9.Jesse Galloway

 

 

 

 

Exhibit E

 

Non-Competition Waiver and Release

 

[see attached]

 

 

 

 

EXHIBIT E

 

OMNIBUS WAIVER AND RELEASE AGREEMENT

 

This OMNIBUS WAIVER AND RELEASE AGREEMENT (this “Agreement”), dated as of [●],
2017, is by and among ARC ADVISORY SERVICES, LLC (“ARC”), AMERICAN REALTY
CAPITAL HOSPITALITY ADVISORS, LLC (“Hospitality Advisor”), AR CAPITAL, LLC (“AR
Capital”), Hospitality Investors Trust, Inc. (formerly known as American Realty
Capital Hospitality Trust, Inc.) (“ARCH” and, together with its current and
future subsidiaries, the “Company”), Hospitality Investors Trust Operating
Partnership, L.P. (formerly known as American Realty Capital Hospitality
Operating Partnership, L.P.) (the “OP”), and each of the individuals listed on
Schedule A to this Agreement (the “Covered Employees”, and together with ARC,
Hospitality Advisor, AR Capital, ARCH and the OP, the “Parties” and each
individually, a “Party”).

 

WITNESSETH:

 

WHEREAS, each Covered Employee (other than Jonathan Mehlman (“JM”) and Paul
Hughes (“PH”)) is a party to an Employee Confidentiality and Non-Competition
Agreement with ARC, effective as of the date listed opposite such Covered
Employee’s name on Schedule A (each agreement, a “Restrictive Covenant
Agreement”, and collectively, the “Restrictive Covenant Agreements”), pursuant
to which such Covered Employee agreed to be bound by certain restrictive
covenants during the term of his or her employment with ARC (together with AR
Capital, Hospitality Advisor and each other affiliated and/or related entity of
ARC which employed such Covered Employee, such Covered Employee’s “Employers”)
and for a specified or indefinite period of time after termination of such
employment;

 

WHEREAS, the Hospitality Advisor, ARCH, the OP and the other parties thereto
have entered into that certain Framework Agreement, dated as of January 12, 2017
(as such agreement may be amended, modified or supplemented, the “Framework
Agreement”);

 

WHEREAS, JM is party to that certain Employment Agreement (as amended, modified
or supplemented, the “JM Employment Agreement”), dated as of July 1, 2015, by
and between JM, ARC, AR Capital and Hospitality Advisor;

 

WHEREAS, PH is party to that certain Employment Agreement (as amended, modified
or supplemented, the “PH Employment Agreement” and together with the JM
Employment Agreements, the “Employment Agreements”), dated as of September 24,
2013, by and between PH and ARC;

 

WHEREAS, in connection with the transactions contemplated by the Framework
Agreement, until the Trigger Date (as defined in the Framework Agreement), the
Company shall have the right to hire each Covered Employee; and

 

WHEREAS, in connection with the transactions contemplated by the Framework
Agreement and subject to receipt from a Covered Employee of an executed
separation and release agreement, substantially in the form attached hereto as
Exhibit A1 (each such separation and release agreement, an “Employee Release”),
ARC wishes to fully, unconditionally and irrevocably release each such Covered
Employee from certain obligations under such Covered Employee’s Restrictive
Covenant Agreement or Employment Agreements, as applicable, in order to permit
such Covered Employee to, at or following the Closing, accept an offer of
employment with the Company (the “Subject Employers” and the date such Covered
Employee commences employment with the Subject Employers, the “Hire Date”).

 

 

1 Note to Draft: This will be Exhibit D-4 from Framework Agreement.

 

 

 

 

NOW, THEREFORE, in consideration of the premises and covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as follows:

 

1.Waiver of Restrictive Covenant Agreements.

 

(a) With respect to each Covered Employee (other than JM and PH), effective at,
but conditioned upon (i) the execution by such Covered Employee and delivery to
the Advisor of an Employee Release that is effective as of such Covered
Employee’s Hire Date and (ii) the acceptance by such Covered Employee of an
offer of employment (and the occurrence of his or her Hire Date) by the Subject
Employers, ARC, on its behalf and on behalf of each other applicable Employer,
hereby acknowledges and agrees that (x) such Covered Employee’s acceptance of
employment with, or employment by, the Subject Employers shall not be deemed a
violation at any time of the non-competition or non-contact provisions in
Section 3 of such Covered Employee’s Restrictive Covenant Agreement and (y) such
Covered Employee shall not be in breach or violation of the non-solicitation
provisions or any other provisions set forth in Section 3 of such Covered
Employee’s Restrictive Covenant Agreement due to the hiring of (A) any other
Covered Employee by the Subject Employers on or prior to the Trigger Date (as
defined in the Framework Agreement), and/or (B) any other employee or
independent contractor of ARC, Hospitality Advisor, AR Capital or their
respective affiliates (1) who responds to a solicitation that constitutes a
good-faith general solicitation, mass advertisement, or similar type of
broad-based publicly disseminated solicitation through advertisement or search
firms not directed specifically toward one or more employees of the ARC,
Hospitality Advisor, AR Capital or their respective affiliates, (2) whose
employment has been terminated by ARC, Hospitality Advisor, AR Capital or their
respective affiliates (other than for cause) at least six (6) months prior to
commencement of such employment discussions or (3) who resigned from their
position or who was terminated by ARC, Hospitality Advisor, AR Capital or their
respective affiliates for cause, in each case, at least twelve (12) months prior
to commencement of such employment discussions.

 

(b) Effective at, but conditioned upon (i) the execution by JM or PH, as
applicable, and delivery to the Advisor of, an Employee Release that is
effective as of such Covered Employee’s Hire Date and (ii) the acceptance by
such Covered Employee of an offer of employment (and the occurrence of his Hire
Date) by the Subject Employers, ARC, on its behalf and each other applicable
Employer, hereby acknowledges and agrees that (x) such Covered Employee’s
acceptance of employment with, and employment by, the Subject Employers shall
not be deemed a violation at any time of Section 10 (with respect to PH) or
Section 8 (with respect to JM) of such Covered Employee’s Employment Agreement
and (ii) such Covered Employee shall not be in breach or violation of Section 10
(with respect to PH) or Section 8 (with respect to JM) of such Covered
Employee’s Employment Agreement due to the hiring of any other Covered Employee
by the Subject Employers prior to the Trigger Date.

 

(c) Notwithstanding anything contained herein to the contrary, this Section 1
shall not apply to any Covered Employee whose Hire Date is after the Trigger
Date.

 

2.Confidentiality.

 

(a) With respect to each Covered Employee for whom the conditions set forth in
Section 1(a) have been satisfied, ARC hereby acknowledges and agrees that
Section 1 of such Covered Employee’s Restrictive Covenant Agreement shall not
apply to confidential information relating to the Company.

 

 2 

 

 

(b) Provided that the conditions set forth in Section 1(b) have been satisfied,
ARC hereby acknowledges and agrees that Section 9 (with respect to PH) and
Section 7 (with respect to JM) of the applicable Covered Employee’s Employment
Agreement shall not apply to confidential information relating to the Company.

 

(c) Notwithstanding anything contained herein to the contrary, this Section 2
shall not apply to any Covered Employee whose Hire Date is after the Trigger
Date.

 

3.            Effectiveness. For the avoidance of doubt, except as explicitly
modified by this Agreement, the Restrictive Covenant Agreements shall be
unmodified and remain in full force and effect.

 

4.            Counterparts. This Agreement may be executed in counterparts
(including by facsimile or other electronic transmission), each one of which
shall be deemed an original and all of which together shall constitute one and
the same Agreement.

 

5.            Governing Law. This Agreement shall be governed by, interpreted
under, and construed and enforced in accordance with, the Law of the State of
New York, not taking into account any rules of conflicts of laws that would
cause the application of the laws of any other jurisdiction.

 

6.            Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.

 

7.            Further Assurances. Each Party shall execute and deliver such
additional documents as may be reasonably requested by any other Party to
consummate the transactions contemplated by this Agreement.

 

8.            Parties in Interest. The Company shall be a third party
beneficiary of this Agreement. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights in any other person not a
party to this Agreement.

 

9.            Entire Agreement. This Agreement constitutes the entire agreement
and understanding among the Parties in respect of the subject matter hereof and
thereof and supersedes all prior and contemporaneous arrangements, agreements
and understandings, both oral and written, whether in term sheets, presentations
or otherwise among the Parties, or between any of them, with respect to the
subject matter hereof and thereof.

 

10.          Headings. The headings and captions herein are inserted for
convenience of reference only and are not intended to govern, limit or aid in
the construction of any term or provision hereof.

 

[Remainder of page intentionally left blank]

 

 3 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first written above.

 

  ARC ADVISORY SERVICES, LLC         By:     Name:     Title:           AMERICAN
REALTY CAPITAL HOSPITALITY ADVISORS, LLC       By: American Realty Capital
Hospitality Special Limited Partner, LLC, its sole member       By: American
Realty Capital IX, LLC, its sole member       By: AR Capital, LLC, its sole
member         By:     Name: Edward M. Weil, Jr.   Title: Chief Executive
Officer         AR CAPITAL, LLC         By:     Name:     Title:          
HOSPITALITY investors trust OPERATING PARTNERSHIP, L.P.       By: Hospitality
Investors Trust, Inc., its general partner         By:     Name:       Title:  

 

 4 

 

 

  HOSPITALITY INVESTORS TRUST, INC.         By:     Name:       Title:  

 

 5 

 

 

  COVERED EMPLOYEES         By:     Name:

 

 

 

2 Note to Draft: To be executed by Transferred Employees under the Framework
Agreement (but excluding any employee that is employed by Crestline or its
subsidiaries).

 

 

 

 

Schedule A3

 

Name   Date of Restrictive Covenant Agreement      

 

 

 

3 Note to Draft: To include Transferred Employees under the Framework Agreement
(but excluding any employee that is employed by Crestline or its subsidiaries).

 

 

 

 

Exhibit F

 

Transition Services Agreement

 

[see attached]

 

 

 

 

EXHIBIT F

 

TRANSITION SERVICES AGREEMENT

 

This TRANSITION SERVICES AGREEMENT (this “Agreement”) dated as of [•], 2017, is
by and among (i) [American Realty Capital Hospitality Advisors, LLC / Crestline
Hotels & Resorts LLC]1 (the “Service Provider”), (ii) Hospitality Investors
Trust, Inc. (formerly known as American Realty Capital Hospitality Trust, Inc.)
(“ARCH”), and (iii) Hospitality Investors Trust Operating Partnership, L.P.
(formerly known as American Realty Capital Hospitality Operating Partnership,
L.P.) (the “OP” and together with ARCH, the “Company”). The Company and the
Service Provider are collectively referred to herein as the “Parties.”

 

WITNESSETH:

 

WHEREAS, the Company, the Service Provider and certain other persons party
thereto have entered into that certain Framework Agreement, dated as of January
12, 2017 (the “Framework Agreement”);

 

WHEREAS, the Company desires, for a transitional period beginning on the date
hereof (the “Effective Date”), to avail itself of the assistance of the Service
Provider and to have the Service Provider undertake the duties and
responsibilities hereinafter set forth; and

 

WHEREAS, the Service Provider is willing to render such services on the terms
and conditions hereinafter set forth.

 

NOW, THEREFORE, in consideration of the premises and covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as set forth herein:

 

1.          Definitions. Capitalized terms used but not defined herein shall
have the meaning ascribed to them in the Framework Agreement, and the following
terms, as used herein, shall have the meanings set forth below:

 

“Affiliate” shall mean, with respect to any person, any other person directly or
indirectly controlling, controlled by, or under common control with such person.
For purposes of this definition, “control” (including, with correlative
meanings, the terms “controlled by” and “under common control with”), as applied
to any person, means the possession, directly or indirectly, of the power to
vote a majority of the securities having voting power for the election of
directors or managers (or other persons acting in similar capacities) of such
person or otherwise to direct or cause the direction of the management and
policies of such person through the ownership of voting securities, by contract
or otherwise.

 

“Person” means any individual, corporation, partnership, limited liability
company, limited partnership, firm, joint venture, association, joint-stock
company, trust, unincorporated organization, governmental authority, other
entity or group.

 

 

1 Note to draft: If requested by the REIT, ARC Hospitality and Crestline to
provide services under two separate transition services agreements on the same
terms as set forth herein (other than as expressly noted).

 

 

 

2.          Duties of the Service Provider.

 

(a)          Effective as of the date hereof, the Company hereby retains and
appoints the Service Provider to perform the services set forth on Schedule A
hereto (the “Services”), and the Service Provider hereby accepts such
appointment, all subject to the terms and conditions hereinafter set forth. The
Service Provider shall devote such time and resources to the performance of the
Services hereunder as it shall determine to be reasonably necessary to fully
perform its obligations hereunder. This Agreement provides no authority for
Service Provider to bind the Company or any of its Affiliates to any agreement,
arrangement or other action. In all instances, Service Provider shall bring any
potential written agreement underlying any Service to the Company for discussion
with, and approval by, the Company.

 

(b)          It is understood and agreed that the Service Provider may retain
third-party service providers (including its Affiliates) to provide some or all
of the Services to the Company. The Service Provider shall in all cases retain
responsibility for the provision to the Company of the Services to be performed
by any third-party service provider or subcontractor or by any of the Service
Provider’s Affiliates.

 

3.          Standard of Service.

 

(a)          The Service Provider represents, warrants and agrees that the
Services shall be provided in good faith, in accordance with applicable Law and,
except as specifically provided in the Schedule A, in a manner generally
consistent with the historical provision of the Services and with the same
standard of care as historically provided. Subject to Section 2(b), the Service
Provider agrees to assign sufficient resources and qualified personnel as are
reasonably required to perform the Services in accordance with the standards set
forth in the preceding sentence.

 

(b)          Except as expressly set forth in Section 3(a) or in any contract
entered into hereunder, the Service Provider makes no representations and
warranties of any kind, implied or expressed, with respect to the Services,
including, without limitation, no warranties of merchantability or fitness for a
particular purpose, which are specifically disclaimed. The Company acknowledges
and agrees that this Agreement does not create a fiduciary relationship,
partnership, joint venture or relationship of trust or agency between any of the
parties hereto, and all Services are provided by the Service Provider as an
independent contractor.

 

(c)          Service Provider or the Company shall promptly notify the Company
or Service Provider, as applicable, of any event or circumstance of which such
Party or any of its representatives has knowledge that causes, or would be
reasonably likely to cause, a material disruption in the Services.

 

(d)          Service Provider shall be solely responsible for the payment of all
employee benefits and any other direct and indirect compensation for Service
Provider (or its Affiliates’) personnel assigned to perform the Services, as
well as such personnel’s worker’s compensation insurance, employment taxes, and
other applicable employer liabilities relating to such personnel as required by
law.

 

2 

 

 

(e)          Service Provider and the Company will maintain or cause to be
maintained reasonable security measures with respect to any interfaces required
between Service Provider and the Company in connection with the Services in a
manner generally consistent with the historical provision of the Services and
with the same standard of care as historically provided. At all times during the
Term, neither Service Provider nor the Company will intentionally or knowingly
introduce, and each will take commercially reasonable measures to prevent the
introduction of, into Service Provider’s or the Company’s computer systems,
databases, or software any viruses or any other contaminants (including, but not
limited to, codes, commands, instructions, devices, techniques, bugs, web bugs,
or design flaws) that may be used to access (without authorization), alter,
delete, threaten, infect, assault, vandalize, defraud, disrupt, damage, disable,
inhibit, or shut down another Party's computer systems, databases, software, or
other information or property. Except as may be required in connection with the
provision of the Services, neither Service Provider nor the Company will
intentionally or knowingly tamper with, compromise, or attempt to circumvent any
physical or electronic security or audit measures employed by the other in the
course of its business operations, and/or intentionally or knowingly compromise
the security of the other’s computer systems and/or networks.

 

(f)          Each of Service Provider and the Company shall reasonably cooperate
with the other and shall cause their respective Affiliates to reasonably
cooperate (i) in notifying the other of any Security Breach affecting Service
Provider or the Company and (ii) in any investigation and mitigation efforts
relating to such Security Breaches, in each case, in such party’s reasonable
discretion and subject to applicable law. As used herein, “Security Breach”
means unauthorized access to or disclosure of computerized data that compromises
the security, confidentiality or integrity of any Confidential Information
maintained by a Party and are part of the Services provided hereunder.

 

(g)          The Company shall use commercially reasonable efforts to maintain
or establish, and cause its directors, officers, other employees, personnel and
agents to comply with, reasonable security measures, as well as all necessary
physical, information and other security practices and policies. Service
Provider shall have no liability for any Security Breach to the extent arising
out of the Company’s failure to comply with this Agreement.

 

4.          Fees and Other Compensation of the Service Provider.

 

(a)          During the Term (as defined below), as consideration for the
Services, the Service Provider shall receive from the Company (by wire transfer
of immediately available funds to account(s) specified by the Service Provider
in writing) (i) [the amounts set forth on Schedule A on the payment schedule set
forth in Schedule A]2 [in advance of the applicable month for which the Services
will be provided the amounts set forth on Schedule A]3 and (ii) all reasonable
and documented out-of-pocket fees, costs and expenses incurred by the Service
Provider in connection with providing the Services, payable within twenty (20)
days of the issuance of an invoice by the Service Provider to the Company
showing the computation of all such fees, costs and expenses under this Section
4.

 

 

2 Note to Draft: Applicable for Advisor TSA only.

3 Note to Draft: Applicable for Crestline TSA only.

3 

 

 

(b)          [Notwithstanding the foregoing, the Parties agree that on or before
October 1 of each calendar year and to the extent that this Agreement remains in
effect and Services continue to be provided hereunder, they will negotiate in
good faith with respect to the consideration specified in Section 4(a)(i) that
will be payable for any month (or portion thereof) during the Term occurring in
the following calendar year. In the event that agreement cannot be so reached,
this Agreement shall automatically terminate on December 31.] 4

 

(c)          All amounts owed by the Company to the Service Provider under this
Agreement shall bear interest from the date due until paid at the lesser of (i)
Prime Rate plus two percent (2%) per annum or (ii) the maximum lawful contract
rate per annum. In no event, however, shall the charges permitted under this
Section or elsewhere in this Agreement, to the extent they are considered to be
interest under applicable law, exceed the maximum lawful rate of interest. As
used herein, the “Prime Rate” shall mean the rate per annum equal to the “Prime
Rate” as published on the due date of the amount in question by The Wall Street
Journal, Southwest Edition, in its listing of “Money Rates.”

 

(d)          Term; Termination of Agreement. The term of this Agreement shall
begin on the Effective Date and shall continue in force until [_____], 20175
[and shall automatically renew for successive 90 day periods unless the Service
Provider, on the one hand, or ARCH or the OP, on the other hand, delivers
written notice to the other at least forty (40) days prior the expiration of the
initial term or any renewal term]6 (the “Term”). The provisions of this Section
5 and Sections 6-15 shall survive the expiration or earlier termination of this
Agreement.

 

5.          Confidentiality.

 

(a)          Service Provider may receive (or otherwise have access to)
Confidential Information of the Company (both orally and in writing) in
connection with the provision of the Services. “Confidential Information” means
any information, whether or not designated or containing any marking such as
“Confidential,” “Proprietary,” or some similar designation, related to the
Company and its services, properties, business, assets and financial condition
relating to the business, finances, technology or operations of the Company or
its Affiliates. Such information may include financial, technical, legal,
marketing, network, and/or other business information, reports, records, or data
(including, but not limited to, computer programs, code, systems, applications,
analyses, passwords, procedures, output, information regarding software, sales
data, vendor lists, customer lists, and employee- or customer-related
information, personally identifiable information, business strategies,
advertising and promotional plans, creative concepts, specifications, designs,
and/or other material.

 

 

4 Note to Draft: Applicable for Crestline TSA only.

5 Note to Draft: Insert date that is 90 days.

6 Note to Draft: Applicable for Crestline TSA only. 

4 

 

 

(b)          Service Provider agrees to treat all Confidential Information
provided by the Company, or which Service Provider otherwise has access to,
pursuant to this Agreement as proprietary and confidential to the Company and to
hold such Confidential Information in confidence. Service Provider shall not
(without the prior written consent of the Company) disclose or permit disclosure
of such Confidential Information to any third party; provided, that, Service
Provider may disclose such Confidential Information as permitted by Section 6(c)
and to its third party subcontractors and its Affiliates’ current employees,
officers, or directors, or legal or financial representatives, in each case, who
have a legitimate need to know such Confidential Information and who have
previously agreed either in writing or orally (including as a condition of their
employment, contract or agency) to be bound by terms respecting the protection
of such Confidential Information which are no less protective as the terms of
this Agreement). Service Provider agrees to safeguard all Confidential
Information of the Company with at least the same degree of care (which in no
event shall be less than reasonable care) as Service Provider uses to protect
its own Confidential Information but no less than a reasonable degree of care.
Service Provider shall only use the Company’s Confidential Information solely
for the purpose of fulfilling its obligations under this Agreement and providing
the Services to the Company. Service Provider shall not, at any time, collect,
use, sell, license, transfer, make available or disclose the Company’s
Confidential Information for its own benefit, the benefit of its Affiliates (or
agents, subcontractors or representatives) or for the benefit of others. Service
Provider will be responsible for any violation of the confidentiality provisions
of Section 6 by its subcontractors and its Affiliates’ employees, officers and
directors, and legal or financial representatives.

 

(c)          Notwithstanding this Section 6, the Parties acknowledge and agree
that the following information shall not be deemed Confidential Information, and
the receiving Party shall have no confidentiality, non-use or nondisclosure
obligation with respect to any such information to the extent that it: (i) is in
the public domain or becomes available in the public domain by no fault or
wrongful act of Service Provider in violation of this Agreement, (ii) was
independently developed by Service Provider or any other Persons without the use
of any Confidential Information, (iii) was already in the Service Provider’s
possession on a non-confidential basis or (iv) is approved for release by
written authorization of the Company and/or the third party owner of the
disclosed information. The Parties further acknowledge and agree that
Confidential Information may be disclosed pursuant to the lawful requirement or
order of a court or governmental agency, or as otherwise required by applicable
law, rule or regulation (including as required in any securities law filings or
offering documentation); provided that prompt notice thereof is given to the
non-disclosing Party (unless such notice is not possible under the
circumstances, and in such event, such notice shall be provided as promptly as
possible thereafter) so that such non-disclosing Party may, at its sole cost and
expense, have the opportunity to intervene and contest such disclosure and/or
seek a protective order or other appropriate remedy.

 

5 

 

 

(d)          All Confidential Information transmitted or disclosed hereunder
will be and remain the property of the Company, and Service Provider shall
promptly (at the Service Provider’s sole election) destroy or return to the
Company all copies thereof upon termination or expiration of this Agreement, or
upon the written request of the Company; provided, that, Service Provider shall
not be required to destroy any Confidential Information that is stored solely as
a result of a backup created in the ordinary course of business and is not
readily destroyable or that is stored on the computers of the personnel of
Service Provider and/or its Affiliates and subject to deletion in accordance
with Service Provider’s and/or its Affiliates’ electronic information management
practices (subject to extended retention by Service Provider’s or its
Affiliates’ compliance and legal department personnel in accordance with the
existing document retention/destruction policy of Service Provider and/or its
Affiliates). Upon the request of the Company, Service Provider shall provide
notice of any such applicable destruction in writing.

 

(e)          The Parties acknowledge and agree that, given the unique and
proprietary nature of the Confidential Information, monetary damages may not be
calculable or a sufficient remedy for any breach of this Section 6 by Service
Provider or its Affiliates, and that the Company may suffer great and
irreparable injury as a consequence of such breach. Accordingly, each Party
agrees that, in the event of such a breach or threatened breach, the Company
shall be entitled to seek equitable relief (including, but not limited to,
injunction and specific performance) in order to remedy such breach or
threatened breach. Such remedies shall not be deemed to be exclusive remedies
for a breach by Service Provider or its Affiliates but shall be in addition to
any and all other remedies provided hereunder or available at law or equity to
the Company.

 

6.          Amendments. This Agreement shall not be changed, modified,
terminated or discharged in whole or in part except by an instrument in writing
signed by all Parties, or their respective successors or permitted assigns, or
otherwise as provided herein.

 

7.          Assignment. This Agreement shall not be assigned by any Party
without the prior written consent of the other Party, except to a Person which
is a successor to all or substantially of the assets of the assigning Party. Any
assignee shall be bound hereunder to the same extent as the Company.
Notwithstanding anything to the contrary contained herein, the economic rights
of the Service Provider hereunder, including the right to receive all
compensation hereunder, may be sold, transferred or assigned by the Service
Provider, without the consent of the Company.

 

8.          Action Upon Termination. From and after the date of termination of
this Agreement, the Service Provider shall not be entitled to compensation for
further service rendered hereunder but shall be reimbursed for all reasonable,
documented out-of-pocket expenses accrued through the date of such termination
within ten (10) business days of such termination. The Service Provider shall
forthwith upon such termination:

 

(a)          pay over to the Company all moneys collected and held for the
account of the Company pursuant to this Agreement, after deducting any accrued
compensation and reimbursement for its expenses to which it is then entitled;
and

 

(b)          deliver to the Company a full accounting, including a statement
showing all payments collected by it and a statement of all moneys held by it,
covering the period following the date of the last accounting furnished to the
Company.

 

6 

 

 

9.           Indemnification.

 

(a)          Indemnification of the Company by the Service Provider. Subject to
Section 11, the Service Provider shall indemnify, defend and hold harmless the
Company, its partners, members, stockholders, other equity holders, directors,
officers, employees and agents and each of their respective Affiliates,
successors and assigns, from and against any and all claims, actions, suits,
proceedings, losses, damages, liabilities, costs and expenses (including
reasonable attorneys’ fees and disbursements) (collectively, “Damages”), arising
out of or resulting from, directly or indirectly, (i) any breach of this
Agreement, or the covenants, obligations, or representations or warranties set
forth herein, by Service Provider or its Affiliates; and (ii) any bad faith,
gross negligence or willful misconduct on the part of Service Provider or its
Affiliates in connection with its provision of the Services. The remedies
provided in this Section 10(a) constitute the sole and exclusive remedy of the
Company for any and all Damages or other claims relating to or arising from this
Agreement.

 

(b)          Indemnification of the Service Provider by the Company. The Company
shall indemnify, defend and hold harmless the Service Provider, its partners,
members, stockholders, other equity holders, directors, officers, employees and
agents and each of their respective Affiliates, successors and assigns, from and
against any and all Damages arising out of or resulting from the performance by
the Service Provider of the Services to the extent that the Service Provider
reasonably believed such performance to be within the scope of authority
conferred upon the Service Provider hereunder, but expressly excluding any act
that would be covered by indemnity from the Service Provide to the Company as
set forth in Section 10(a) hereof.

 

(c)          The Company will advance amounts to the Service Provider or its
Affiliates for legal expenses and other costs incurred as a result of any legal
action for which indemnification is being sought only if all of the following
conditions are satisfied: (i) the legal action relates to acts or omissions with
respect to the performance of duties or services on behalf of the Company and
(ii) the Service Provider or its Affiliates undertake in writing to repay the
advanced funds to the Company, together with the applicable legal rate of
interest thereon, in cases in which the Service Provider or its Affiliates are
found not to be entitled to indemnification.

 

10.         Limitation on Liability. In no event shall (a) any Party have any
liability under this Agreement for any punitive, incidental, consequential
(other than reasonably foreseeable consequential damages), special or indirect
damages, including loss of future revenue or income, loss of business reputation
or opportunity relating to the breach or alleged breach of this Agreement, or
diminution of value or any damages based on any type of multiple, whether based
on statute, contract, tort or otherwise, and whether or not arising from the
other party’s sole, joint, or concurrent negligence, strict liability, criminal
liability or other fault or (b) the Service Provider’s aggregate liability under
this Agreement (exclusive of amounts recovered under insurance) exceed an amount
equal to the aggregate fees received by the Service Provider under this
Agreement.

 

 

11.         Notices. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing, and shall be given by
delivering such notice by hand, by certified mail, return receipt requested,
postage pre-paid, or by e-mail or facsimile at the following addresses of the
Parties:

 

7 

 

 

Company:                   Fax:     Email:     Attention:         With a copy
to:                   Fax:     Email:     Attention:  

 

Service Provider:       American Realty Capital Hospitality Advisors, LLC   405
Park Ave., 14th Floor   New York, NY 10022   Attention: Jesse Charles Galloway  
  Facsimile: (646) 861-7804   Email: jgalloway@ar-global.com       With a copy
to:       Paul, Weiss, Rifkind, Wharton & Garrison LLP   1285 Avenue of the
Americas   New York, New York 10019-6064   Attention: Jeffrey D. Marell, Esq.  
Facsimile: (212) 492-0105   Email: jmarell@paulweiss.com

 

8 

 

 

Any party may at any time change its address for the purpose of this section by
like notice.

 

12.         Insurance. The Service Provider shall maintain, at its sole cost and
expense, at all times during the Term (and for a period of time continuing for
no less than eighteen (18) months following the Term) a professional liability
insurance (errors and omissions) policy with such coverages and policy as then
maintained by the Service Provider and its affiliates and with coverages of no
less than $5,000,000. ARCH, the Company and each of their Subsidiaries shall be
a named as “additional insureds” under such policy. All insurance required to be
carried by Service Provider shall be written with companies having a
policyholder and asset rate, as circulated by Best’s Insurance Reports, of
A-:VIII or better. On or prior to the date hereof and from time to time upon the
Company’s request, Service Provider shall provide certificates of insurance
evidencing such coverage and such other documentation (including a copy of the
policy) as may be requested.

 

13.         Entire Agreement. This Agreement (together with the Framework
Agreement and the other documents contemplated thereby) constitutes the entire
agreement and understanding among the Parties in respect of the subject matter
hereof and thereof and supersedes all prior and contemporaneous arrangements,
agreements and understandings, both oral and written, whether in term sheets,
presentations or otherwise among the Parties, or between any of them, with
respect to the subject matter hereof and thereof.

 

14.         Miscellaneous. Sections 11 (Counterparts), 12 (Governing Law;
Specific Performance; WAIVER OF JURY TRIAL), 13 (Severability), 14 (Further
Assurances), 15 (Parties in Interest), 17 (Headings), 18 (Expenses), 19
(Construction), and Section 22 (Amendments and Waivers) of the Framework
Agreement are incorporated herein by reference, mutatis mutandis.

 

[Remainder of Page Intentionally Left Blank]

 

9 

 

 

IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed
and delivered as of the date first above written.

 

  HOSPITALITY INVESTORS TRUST, INC.       By:     Name:     Title:          
HOSPITALITY INVESTORS TRUST OPERATING PARTNERSHIP, L.P.       By: Hospitality
Investors Trust, Inc., its general partner          By:     Name:     Title:    
      [AMERICAN REALTY CAPITAL HOSPITALITY ADVISORS, LLC       By: American
Realty Capital Hospitality Special Limited Partner, LLC, its sole member        
By: American Realty Capital IX, LLC, its sole member         By: AR Capital,
LLC, its sole member         By:     Name: Edward M. Weil, Jr.   Title: Chief
Executive Officer ]         [CRESTLINE HOTELS & RESORTS, LLC       By:     Name:
    Ttle: ]

 

 

 

 

Exhibit G

 

Registration Rights Agreement

 

[see attached]

 

 

 

 

EXHIBIT G

 

 

 

Registration Rights Agreement

 

by and among

 

Hospitality Investors Trust, Inc.,

 

Brookfield Strategic Real Estate Partners II Hospitality REIT II, LLC,

 

American Realty Capital Hospitality Advisors, LLC

 

and

 

American Realty Capital Hospitality Properties, LLC

 

Dated as of [●], 2017

 

 

 

 

 

 

Table of Contents

 

    Page Article I   DEFINITIONS Section 1.01. Defined Terms 2 Section 1.02.
Other Interpretive Provisions 6 Article II   REGISTRATION RIGHTS Section 2.01.
Registrations. 7 Section 2.02. Demand Registration. 9 Section 2.03. Shelf
Registration. 9 Section 2.04. Piggyback Registration. 11 Section 2.05. Black-out
Periods. 12 Section 2.06. Registration Procedures. 13 Section 2.07. Underwritten
Offerings. 18 Section 2.08. No Inconsistent Agreements 21 Section 2.09.
Registration Expenses 21 Section 2.10. Indemnification 22 Section 2.11. Rules
144 and 144A and Regulation S 25 Article III   MISCELLANEOUS Section 3.01. Term
26 Section 3.02. Notices 26 Section 3.03. Amendment 28 Section 3.04. Successors,
Assigns and Transferees 28 Section 3.05. Binding Effect 28 Section 3.06. Third
Parties 29 Section 3.07. Governing Law; Injunctive Relief 29 Section 3.08.
Jurisdiction; Waiver of Jury Trial 29 Section 3.09. Entire Agreement 30 Section
3.10. Severability 30 Section 3.11. Counterparts 30 Section 3.12. No Recourse.
31 Section 3.13. Headings 31

 

 - x - 

 

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of [●], 2017, is
by and among Hospitality Investors Trust, Inc., a Maryland corporation (together
with its successors, the “Company”), Brookfield Strategic Real Estate Partners
II Hospitality REIT II, LLC, a Delaware limited liability company (
“Brookfield”), American Realty Capital Hospitality Advisors, LLC, a Delaware
limited liability company ( the “Advisor”), and American Realty Capital
Hospitality Properties, LLC, a Delaware limited liability company, (the
“Property Manager”), and such other Persons, if any, from time to time that
become party hereto as holders of Registrable Securities (as defined below)
pursuant to Section 3.04. Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to such terms in the Purchase Agreement
(as defined herein).

 

WITNESSETH:

 

WHEREAS, on January 12, 2017, the Company, American Realty Capital Hospitality
Operating Partnership, L.P., a Delaware limited partnership (“Opco”), and
Brookfield entered into a Securities Purchase, Voting and Standstill Agreement
(as may be amended from time to time, the “Purchase Agreement”);

 

WHEREAS, immediately following the Closing (as defined below), Brookfield will
hold 9,152,542.37 CPUs (as defined below) and may acquire additional CPUs
pursuant to and on the terms and conditions set forth in the Purchase Agreement;

 

WHEREAS, immediately following the Closing, the Advisor will hold 525,046 Common
Shares and the Property Manager will hold 279,329 Common Shares issuable
pursuant to the Framework Agreement among the Company, Advisor, Opco, the
Property Manager, American Realty Capital Hospitality Grace Portfolio, LLC,
Crestline Hotels & Resorts, LLC, American Realty Capital Hospitality Special
Limited Partnership, LLC and Brookfield, dated as of January 12, 2017 (as may be
amended from time to time, the “Framework Agreement”);

 

WHEREAS, Brookfield shall have the right to convert CPUs into OP Units which are
redeemable for Common Shares of the Company pursuant to and on the terms and
conditions set forth in the Amended and Restated Limited Partnership Agreement
of Opco, dated as of the date hereof, (as may be amended from time to time in
accordance with its terms, the “A&R Opco LPA”);

 

WHEREAS, the Company, Brookfield, the Advisor and the Property Manager desire to
enter into this Agreement as contemplated by the terms of the Purchase Agreement
and the Framework Agreement to set forth certain registration and other rights
with respect to the Registrable Securities.

 

NOW, THEREFORE, in consideration of the foregoing and the mutual promises,
covenants and agreements of the parties hereto, and for other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

 

 

 

 

Article I

 

DEFINITIONS

 

Section 1.01.         Defined Terms. As used in this Agreement, the following
terms shall have the following meanings:

 

“A&R Opco LPA” has the meaning set forth in the recitals.

 

“Adverse Disclosure” means public disclosure of material non-public information
that, in the Board’s good faith judgment, after consultation with outside
counsel to the Company, (i) would be required to be made in any Registration
Statement or report filed with the SEC by the Company so that such Registration
Statement from and after its effective date, does not contain an untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading; (ii)
would not be required to be made at such time but for the filing, effectiveness
or continued use of such Registration Statement or report; and (iii) the Company
has a bona fide business purpose for not disclosing.

 

“Advisor” has the meaning set forth in the preamble and shall include any
Affiliate of the Advisor that succeeds to the rights hereunder pursuant to
Section 3.04.

 

“Affiliate” has the meaning specified in Rule 12b-2 under the Exchange Act;
provided, that no Holder shall be deemed an Affiliate of the Company or any of
its subsidiaries for purposes of this Agreement. The term “Affiliated” has a
correlative meaning.

 

“Agreement” has the meaning set forth in the preamble.

 

“Brookfield” has the meaning set forth in the preamble and shall include any
Affiliate of Brookfield that succeeds to the rights hereunder pursuant to
Section 3.04.

 

“Business Day” means a day that is a Monday, Tuesday, Wednesday, Thursday or
Friday and is not a day on which banking institutions in New York, New York
generally are authorized or obligated by Law, regulation or executive order to
close.

 

“Common Shares” means shares of common stock of the Company, par value $0.01 per
share.

 

“Company” has the meaning set forth in the preamble and shall include the
Company’s successors by merger, acquisition, reorganization, conversion or
otherwise.

 

“Company Public Sale” has the meaning set forth in Section 2.04(a).

 

“CPUs” means a new series of convertible preferred operating partnership units
of Opco designated under the A&R Opco LPA as the “Class C Units.”

 

“Demanding Holders” has the meaning set forth in Section 2.01(a).

 

“Demand Notice” has the meaning set forth in Section 2.02(b)

 

 2 

 

 

“Demand Period” has the meaning set forth in Section 2.02(d).

 

“Demand Registration Statement” means a Registration Statement on Form S-11 or
S-1 (or any successor form or other appropriate form under the Securities Act)
for an offering to be made on a continuous basis pursuant to Rule 415 under the
Securities Act (or any similar rule that may be adopted by the SEC) covering the
Registrable Securities, as applicable.

 

“Demand Request” has the meaning set forth in Section 2.01(a).

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and any
successor thereto, and any rules and regulations promulgated thereunder, all as
the same shall be in effect from time to time.

 

“FINRA” means the Financial Industry Regulatory Authority, Inc.

 

“Framework Agreement” has the meaning set forth in the recitals.

 

“Holder” means any holder of Registrable Securities, including Brookfield, the
Property Manager and the Advisor, who is a party hereto or who succeeds to
rights hereunder pursuant to Section 3.04.

 

“Initiating Holder” means the Holder, or, in the case of a Demand Request by the
Demanding Holders, the Demanding Holders, making a Demand Request pursuant to
Section 2.02 or a Shelf Request pursuant to Section 2.03.

 

“Issuer Free Writing Prospectus” means an issuer free writing prospectus, as
defined in Rule 433 under the Securities Act, relating to an offer of the
Registrable Securities.

 

“Launch Date” means, with respect to an Underwritten Offering, the commencement
of marketing activities or, if no such marketing activities are contemplated,
the earliest of (x) the filing of a preliminary Prospectus covering such
Underwritten Offering, (y) the public announcement of the Company’s intention to
conduct such Underwritten Offering, and (z) the public announcement of the
pricing of such Underwritten Offering.

 

“Loss” and “Losses” has the meaning set forth in Section 2.10(a).

 

“Non-Recourse Parties” has the meaning set forth in Section 3.12.

 

“Opco” has the meaning set forth in the recitals.

 

“OP Unit” means a unit of interest in Opco, which is designated as an OP Unit of
the partnership.

 

“Participating Holder” means, with respect to any Registration, any Holder of
Registrable Securities covered by the applicable Registration Statement.

 

“Permitted Assignee” has the meaning set forth in Section 3.04.

 3 

 

 

“Person” means and includes natural persons, corporations, limited partnerships,
general partnerships, limited liability companies, limited liability
partnerships, joint stock companies, joint ventures, associations, companies,
trusts, banks, trust companies, land trusts, business trusts, or other
organizations, irrespective of whether they are legal entities, and governments
and agencies and political subdivisions thereof, including any syndicate or
group that would be deemed to be a “person” under Section 13(d)(3) of the
Exchange Act.

 

“Piggyback Registration” has the meaning set forth in Section 2.04(a).

 

“Property Manager” has the meaning set forth in the preamble and shall include
any Affiliate of the Property Manager that succeeds to the rights hereunder
pursuant to Section 3.04.

 

“Prospectus” means the prospectus included in any Registration Statement, all
amendments and supplements to such prospectus, including pre- and post-effective
amendments to such Registration Statement, and all other material incorporated
by reference in such prospectus.

 

“Purchase Agreement” has the meaning set forth in the recitals.

 

“Reduction Securities” has the meaning set forth in Section 2.10(d).

 

“Registrable Securities” means any Shares and any securities that may be issued
or distributed or be issuable in respect of any by way of conversion, dividend,
stock split or other distribution, merger, consolidation, exchange,
recapitalization or reclassification or similar transaction, in each case held
by any Holder as of the date hereof or as may be acquired and held by any Holder
at any time after the date hereof pursuant to the Purchase Agreement, the A&R
Opco LPA (including by way of Transfer (as defined in the A&R Opco LPA)), the
Framework Agreement and the other Transaction Documents; provided, that any such
Registrable Securities shall cease to be Registrable Securities to the extent
(i) a Registration Statement with respect to the sale of such Registrable
Securities has become effective under the Securities Act and such Registrable
Securities have been disposed of pursuant to such Registration Statement,
(ii) such Registrable Securities are able to be sold pursuant to Rule 144 under
the Securities Act (or any similar or analogous rule promulgated under the
Securities Act) without volume limitations or other restrictions under such
Rule; (iii) such Registrable Securities shall have been otherwise transferred
and no longer bear a legend restricting transfer under the Securities Act, and
such Registrable Securities may be publicly resold without Registration under
the Securities Act; or (iv) such Registrable Securities cease to be outstanding.

 

“Registration” means a registration with the SEC of the Company’s securities for
offer and sale to the public under a Registration Statement. The term “Register”
shall have a correlative meaning.

 

“Registration Expenses” has the meaning set forth in Section 2.09.

 

 4 

 

 

“Registration Statement” means any registration statement of the Company filed
with, or to be filed with, the SEC under the rules and regulations promulgated
under the Securities Act, including the related Prospectus, amendments and
supplements to such registration statement, including pre- and post-effective
amendments, and all exhibits and all material incorporated by reference in such
registration statement.

 

“Representatives” means, with respect to any Person, any of such Person’s
officers, directors, employees, agents, attorneys, accountants, actuaries,
consultants, equity financing partners or financial advisors or other Person
associated with, or acting on behalf of, such Person.

 

“Request” means a Demand Request, a Shelf Request, a WKSI Takedown Request or a
request by a Holder for Registrable Securities to be included as part of a
Piggyback Registration.

 

“Resumption Date” has the meaning set forth in Section 2.07.

 

“SEC” means the Securities and Exchange Commission.

 

“Securities Act” means the Securities Act of 1933, as amended, and any successor
thereto, and any rules and regulations promulgated thereunder, all as the same
shall be in effect from time to time.

 

“Shares” means (i) the Common Shares issuable upon redemption of OP Units
issuable upon conversion of the CPUs that have actually been issued to Holders
pursuant to the Purchase Agreement; (ii) the Common Shares issued to the Advisor
and the Property Manager pursuant to the Framework Agreement, (iii) any other
securities issued as a distribution with respect to, or in exchange for or in
replacement of any of the foregoing Shares; and (iv) any other securities issued
or transferred in exchange for or upon conversion of any of the foregoing Shares
as a result of a merger, consolidation, reorganization or otherwise (including,
without limitation, any securities issued upon the conversion of the Company to
a successor corporation) and any other securities issued to any of the Holders
in connection with any such transaction.

 

“Shelf Notice” has the meaning set forth in Section 2.03(c).

 

“Shelf Period” has the meaning set forth in Section 2.03(b).

 

“Shelf Registration” means a Registration effected pursuant to Section 2.03.

 

“Shelf Registration Statement” means a Registration Statement of the Company
filed with the SEC on Form S-3 (or any successor form or other appropriate form
under the Securities Act) for an offering to be made on a continuous basis
pursuant to Rule 415 under the Securities Act (or any similar rule that may be
adopted by the SEC) covering the resale of Registrable Securities by their
Holders from time to time in accordance with the methods of distribution elected
by the Holders and set forth therein, as applicable.

 

“Shelf Request” has the meaning set forth in Section 2.01(a).

 

 5 

 

 

“Stand-Down Notice” has the meaning set forth in Section 2.07(b)(ii).

 

“Suspension” has the meaning set forth in Section 2.01(e).

 

“Underwritten Offering” means the offer and sale of Registrable Securities for
cash pursuant to an effective Registration Statement under the Securities Act
(other than a Registration Statement on Form S-4 or Form S-8 or any successor
form) in which an underwriter participates in the distribution of such
securities, including on a firm commitment basis for reoffer and resale to the
public, including any such offering that is a bought deal or block sale.

 

“Underwritten Offering Request” has the meaning set forth in Section 2.07(a).

 

“WKSI” means any Securities Act registrant that is a well-known seasoned issuer
as defined in Rule 405 under the Securities Act at the most recently eligibility
determination date specified in paragraph (2) of that definition.

 

“WKSI Takedown Request” has the meaning set forth in Section 2.03(d).

 

Section 1.02.         Other Interpretive Provisions. Wherever required by the
context of this Agreement:

 

(a)          the singular shall include the plural and vice versa;

 

(b)          the masculine gender shall include the feminine and neuter genders
and vice versa;

 

(c)          references to any agreement, document or instrument shall be deemed
to refer to such agreement, document or instrument as amended, supplemented or
modified from time to time;

 

(d)          all article, section, paragraph or clause references not attributed
to a particular document shall be references to such parts of this Agreement;

 

(e)          all exhibit, annex, letter and schedule references not attributed
to a particular document shall be references to such exhibits, annexes, letters
and schedules to this Agreement;

 

(f)          the word “or” is not exclusive;

 

(g)          the words “including,” “includes,” “included” and “include” are
deemed to be followed by the words “without limitation;”

 

(h)          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;

 

(i)          the article, section, paragraph and clause captions herein are for
convenience of reference only, do not constitute part of this Agreement and will
not be deemed to limit or otherwise affect any of the provisions hereof;

 

 6 

 

 

(j)          all accounting terms not specifically defined herein shall be
construed in accordance with GAAP; and

 

(k)          the term “party” or “parties” shall mean a party to or the parties
to this Agreement unless the context requires otherwise.

 

Article II

 

REGISTRATION RIGHTS

 

Section 2.01.         Registrations.

 

(a)          Registration Requests. If at any time there are outstanding
Registrable Securities, any of (i) Brookfield, (ii) Holders of a majority of the
outstanding Registrable Securities (the “Demanding Holders”), (iii) the Advisor,
or (iv) the Property Manager may from time to time and at any time make a
written request to the Company for Registration of all or part of the
Registrable Securities held by them (i) on a Demand Registration Statement (a
“Demand Request”) at any time the Company is only eligible to use Form S-11 or
S-1 or any similar long-form Registration Statement or (ii) on a Shelf
Registration Statement (a “Shelf Request”) at any time the Company is qualified
to use Form S-3 or any similar short-form registration statement. Any Demand
Registration Statement or Shelf Registration Statement shall be for the
registered resale of Registrable Securities by their Holders from time to time
in accordance with the methods of distribution elected by the Holders and set
forth therein. So long as a Shelf Registration Statement is effective with
respect to any Registrable Securities, no Request pursuant to this Section 2.01
shall be made with respect to such Registrable Securities.

 

(b)          Subject to the limitations set forth in Section 2.01(c) and (e),
promptly upon receiving any Request requiring the Company to file a Registration
Statement, the Company shall use its reasonable best efforts to file a
Registration Statement relating to such Request (i) in the case of a Demand
Registration Statement, within sixty (60) days after receipt of a Demand Request
for such Registration and (ii) in the case of a Shelf Registration Statement,
within thirty (30) days after receipt of a Request for such Registration, and
shall use its reasonable best efforts to cause such Registration Statement to be
declared effective under the Securities Act as promptly as practicable after the
filing thereof with the SEC. No Registration shall be deemed to have been
effected if (i) during the Demand Period or Shelf Period such Registration is
interfered with by any stop order injunction or other order or requirement of
the SEC or other governmental agency or court or (ii) the conditions to closing
specified in the underwriting agreement, if any, entered into in connection with
such Registration are not satisfied other than by reason of a wrongful act,
misrepresentation or breach of such applicable underwriting agreement by a
Holder.

 

(c)          Limitation on Registrations. Brookfield and the Demanding Holders
shall collectively have the right to make up to three (3) Requests in any twelve
(12) month period. The Advisor and the Property Manager shall, collectively,
have the right to make one (1) Request. Notwithstanding the foregoing (and
unless otherwise consented to by the Board), (i) Brookfield, the Advisor, the
Property Manager and the Demanding Holders may collectively make no more than
(A) three (3) Requests in any twelve (12) month period or (B) more than one (1)
Request in any three (3) month period and (ii) in no event shall the Company be
required to file more than three (3) Registration Statements in any twelve (12)
month period.

 

 7 

 

 

(d)          Reduction Securities. Notwithstanding anything contained herein to
the contrary, in the event that the SEC limits the amount of Registrable
Securities that may be included and sold by Holders in any Registration
Statement, including any Shelf Registration Statement or Demand Registration
Statement, pursuant to Rule 415 or any other basis, the Company may reduce the
number of Registrable Securities included in such Registration Statement on
behalf of the Holders in whole or in part (in case of an exclusion as to a
portion of such Registrable Securities, such portion shall be allocated pro rata
among such Holders in proportion to the respective numbers of Registrable
Securities represented by Shares requested to be registered by each such Holder
over the total amount of Registrable Securities represented by Shares) (such
Registrable Securities, the “Reduction Securities”); provided, however, that
prior to making any such reduction, the Company shall be obligated to use its
reasonable best efforts to advocate with the SEC for the Registration of all of
the Registrable Securities. In such event the Company shall give the Holders
prompt notice of the number of such Reduction Securities excluded and the
Company will not be liable for any damages under this Agreement in connection
with the exclusion of such Reduction Securities. The Company shall use its
reasonable best efforts at the first opportunity that is permitted by the SEC to
Register for resale the Reduction Securities. Such new Registration Statement
shall be on Form S-3 (except if the Company is not then eligible to Register for
resale the Reduction Securities on Form S-3, in which case such Registration
Statement shall be on another appropriate form for such purpose). The Company
shall use its reasonable best efforts to cause each such Registration Statement
to be declared effective under the Securities Act as soon as possible, and shall
use its commercially reasonable efforts to keep such Registration Statement
continuously effective under the Securities Act during the entire Demand Period
or Shelf Period, as applicable.

 

(e)          Delay in Filing; Suspension of Registration. If a majority of the
Board of Directors of the Company determines in good faith that the filing,
initial effectiveness or continued use of a Shelf Registration Statement or a
Demand Registration Statement at any time would (i) render the Company unable to
comply with applicable securities laws, (ii) require the inclusion or filing of
financial statements under Rules 3-05 or 3-14 or Article 11 under the Securities
Act with respect to an acquisition at a significance level of greater than 50%
that the Company is reasonably unable to include or file at such time or (iii)
require the Company to make an Adverse Disclosure, the Company may, upon giving
prompt written notice of such action to the Holders, delay the filing or initial
effectiveness of, or suspend use of, such Registration Statement (a
“Suspension”); provided, however, that the Company shall not be permitted to
exercise a Suspension for a period of more than sixty (60) consecutive calendar
days on any one occasion or an aggregate of ninety (90) days in any twelve (12)
month period, and in any case not more than three (3) times in any twelve (12)
month period. In the case of a Suspension, the Holders agree to suspend use of
the applicable Prospectus in connection with any sale or purchase, or offer to
sell or purchase, Registrable Securities, upon receipt of the notice referred to
above, and agree to keep the fact of any Suspension strictly confidential. The
Company shall immediately notify the Holders upon the termination of any
Suspension, amend or supplement the Prospectus, if necessary, so it does not
contain any untrue statement or omission and furnish to the Holders such numbers
of copies of the Prospectus as so amended or supplemented as the Holders may
reasonably request. The Company agrees, if necessary, to supplement or make
amendments to any Registration Statement that is subject to a Suspension, if
required by the Securities Act, including the undertakings required to be
included in any Registration Statement pursuant to Item 512 of Regulation S-K.

 8 

 

 

Section 2.02.         Demand Registration.

 

(a)          Demand Registration. Each request for a Demand Registration shall
specify the kind and aggregate amount of Registrable Securities to be Registered
and the intended methods of disposition thereof.

 

(b)          Demand Notice. Promptly upon receipt of any Demand Request on a
date on which the Company is not eligible to file a Shelf Registration Statement
(but in no event more than five (5) Business Days thereafter), the Company shall
deliver a written notice (a “Demand Notice”) of any such Registration request to
all other Holders, and the Company shall include in such Demand Registration
Statement all such Registrable Securities with respect to which the Company has
received written requests for inclusion therein within five (5) Business Days
after the date that the Demand Notice has been delivered. All requests made
pursuant to this Section 2.02(b) shall specify the aggregate amount of
Registrable Securities to be registered and the intended method of distribution
of such securities. If any Holder does not deliver a notice within five (5)
Business Days after the delivery of the Demand Notice, such Holder shall be
deemed to have irrevocably waived any and all rights under this Section 2.02
with respect to such Registration (but not with respect to future Registrations
in accordance with this Section 2.02(b)).

 

(c)          Demand Withdrawal. Any Holder that has requested its Registrable
Securities be included in a Demand Registration pursuant to Sections 2.02(a) or
2.02(b), may withdraw all or any portion of its Registrable Securities from a
Demand Registration by providing written notice to the Company at least two (2)
Business Days prior to the effectiveness of the applicable Demand Registration
Statement or, in the case of an Underwritten Offering, at least two (2) Business
Days prior to the time of pricing of such Underwritten Offering. The Company
shall continue its reasonable best efforts to secure effectiveness of the
applicable Demand Registration Statement in respect of the Registrable
Securities of any other Holder that has requested inclusion in the Demand
Registration Statement pursuant to Section 2.02(a) or 2.02(b) so long as the
Initiating Holder has not withdrawn all of its Registrable Securities to be
included in such Demand Registration Statement; provided, however, if the
Initiating Holder has requested for all of its Registrable Securities to be
withdrawn from such Demand Registration Statement, the Company shall immediately
cease all efforts to secure effectiveness of the applicable Demand Registration
Statement, even if one or more other Holders have requested for Registrable
Securities to be included in such applicable Demand Request pursuant to Section
2.02(b) and such withdrawn Demand Registration Statement shall not count towards
the limitation on Registration Statements set forth in Section 2.01(c).

 

(d)          Effective Registration. The Company shall use reasonable best
efforts to cause any Demand Registration Statement to be declared effective by
the SEC and to remain effective for not less than one hundred eighty (180) days
(or such shorter period as shall terminate when all Registrable Securities
covered by such Demand Registration Statement have been sold or withdrawn) (the
applicable period, the “Demand Period”).

 

 9 

 

 

Section 2.03.         Shelf Registration.

 

(a)          Filing.

 

(i)          Subject to the limitations set forth in Section 2.01(c) and (e), if
a Shelf Request is made, the Company shall1 file with the SEC a Shelf
Registration Statement pursuant to Rule 415 of the Securities Act relating to
the offer and sale by Holders from time to time in accordance with the methods
of distribution elected by the Initiating Holder and set forth in the Shelf
Registration Statement and, as promptly practicable thereafter, shall use its
reasonable best efforts to cause such Shelf Registration Statement to be
declared effective under the Securities Act. Each Shelf Request shall specify
the kind of Registrable Securities to be Registered, the intended methods of
disposition thereof and, unless the Company is a WKSI at the time of such Shelf
Request, the aggregate amount thereof. At any time prior to or after the filing
of a Shelf Registration Statement, a Holder may request, which request shall be
deemed a Shelf Request for purposes of Section 2.01(c), that the number of its
Registrable Securities previously requested to be registered on such Shelf
Registration Statement be increased to a larger number of its Registrable
Securities and the Company shall thereafter use its reasonable best efforts to
take all actions reasonably necessary to effect such increase for such Shelf
Registration Statement as promptly as practicable thereafter, which actions may
include causing a post-effective amendment to such Shelf Registration Statement
to be filed or filing a new Shelf Registration Statement; provided, that such
requests by any Holder and such filings by the Company shall be subject to the
limitations of Section 2.01(c). If, on the date of any such request, the Company
does not qualify to file a Shelf Registration Statement under the Securities
Act, such request shall be deemed to be a Demand Request for purposes of Section
2.01(c) and the Company’s obligations under Section 2.02 shall apply with
respect to such request.

 

(ii)         If, on the date of the Shelf Request, the Company is a WKSI, then
the Holders should be permitted to include in such Shelf Request an unspecified
amount of Registrable Securities. The Company shall provide to the Holders the
information necessary to determine the Company’s status as a WKSI upon request.

 

(b)          Continued Effectiveness. The Company shall use its reasonable best
efforts to keep such Shelf Registration Statement continuously effective under
the Securities Act in order to permit the Prospectus forming a part thereof to
be usable by Holders until such date as all Registrable Securities covered
thereby cease to be Registrable Securities (such period of effectiveness, the
“Shelf Period”).

 

 

1 Note to Cleary: Time periods in 2.01(b)

 

 10 

 

 

(c)          Shelf Notice. Promptly upon receipt of a Shelf Request pursuant to
Section 2.03(a) (but in no event more than five (5) Business Days thereafter),
the Company shall deliver a written notice (a “Shelf Notice”) of the receipt of
such request, describing it in reasonable detail, to all other Holders. If the
Company is not a WKSI, the Company shall offer each such Holder the opportunity
to include in the Shelf Registration Statement the number of Registrable
Securities with respect to which the Company has received written requests for
inclusion therein within five (5) Business Days after the date that the Shelf
Notice has been delivered. If any such Holder receiving the Shelf Notice does
not deliver a notice within five (5) Business Days after the date that the Shelf
Notice has been delivered, such Holder shall be deemed to have irrevocably
waived any and all right under this Section 2.03with respect to such
Registration (but not with respect to future Registrations in accordance with
this Section 2.03). If the Company is a WKSI, no Holder shall be required to
request inclusion of Registrable Securities in the Shelf Registration Statement
until such time that the Company delivers a WKSI Takedown Request in connection
with such Shelf Registration Statement pursuant to Section 2.03(d) hereunder.

 

(d)          WKSI Takedown. In the event that the Company is a WKSI and has
filed a Shelf Registration Statement registering an unspecified amount of
Registrable Securities pursuant to Section 2.03(a)(ii), an offering or sale of
Registrable Securities pursuant to a Shelf Registration Statement may be
initiated at any time and from time to time during the effectiveness of a Shelf
Registration Statement, by notice to the Company specifying the intended method
or methods of disposition thereof, by written request of an Initiating Holder to
the Company (each, a “WKSI Takedown Request”) to effect a public offering of all
or a portion of an Initiating Holder’s Registrable Securities that are covered
or will be covered by such Shelf Registration Statement. As soon as practicable
after the receipt of a WKSI Takedown Request the Company shall amend or
supplement the Shelf Registration Statement as necessary for such purpose. For
the avoidance of doubt, a WKSI Takedown Request with respect to an Underwritten
Offering and shall be subject to the procedures, conditions and restrictions set
forth in Section 2.07(a).

 

(e)          Distributions of Registrable Securities to Partners or Members. In
the event any Holder requests to participate in a Registration pursuant to this
Section 2.03 in connection with a distribution of Registrable Securities to its
partners or members, the Registration shall provide for resale by such partners
or members, if requested by the Holder and provided such Registrable Securities
have been assigned to such partners or members in accordance with Section 3.04
in connection with such distribution.

 

 11 

 

 

Section 2.04.         Piggyback Registration.

 

(a)          Participation. Subject to the limitations set forth in Section
2.01, if the Company at any time proposes to file a Registration Statement under
the Securities Act with respect to any offering of any equity securities of the
Company or Opco for the account of the Company or Opco or for the account of any
other Persons (other than (i) a Registration under Sections 2.01, 2.02 or 2.03,
(ii) a Registration on Form S-4 or S-8 or any successor form to such Forms,
(iii) in connection with an “at-the-market” equity distribution program or
dividend reinvestment program or (iv) a Registration of securities solely
relating to an offering and sale to employees or directors of the Company
pursuant to any employee stock plan or other employee benefit plan arrangement)
(a “Company Public Sale”), then, as soon as reasonably practicable, the Company
shall give written notice of such proposed filing to the Holders, and such
notice shall offer the Holders the opportunity to Register under such
Registration Statement such number of Registrable Securities as each such Holder
may request in writing (a “Piggyback Registration”). Subject to Section 2.07(c),
the Company shall include in such Registration Statement all such Registrable
Securities that are requested to be included therein within five (5) days after
the receipt by such Holders of any such notice; provided that if at any time
after giving written notice of its intention to Register or sell any securities,
and prior to the effective date of the Registration Statement filed in
connection with such Registration, the Company shall determine for any reason
not to Register or sell or to delay Registration or sale of such securities, the
Company shall give written notice of such determination to each Holder and,
thereupon, (i) in the case of a determination not to Register or sell, shall be
relieved of its obligation to Register or sell any Registrable Securities in
connection with such Registration (but not from its obligation to pay the
Registration Expenses in connection therewith), without prejudice, however, to
the rights of Brookfield, the Advisor, the Property Manager or the Demanding
Holders to request that such Registration be effected as a Demand Registration
under Section 2.01 or an Underwritten Offering, as the case may be, and (ii) in
the case of a determination to delay Registering or selling, in the absence of a
Demand Request or a request with respect to a Underwritten Offering, shall be
permitted to delay Registering or selling any Registrable Securities, for the
same period as the delay in Registering or selling such other securities.

 

(b)          Withdrawal. Each Holder shall be permitted to withdraw all or part
of its Registrable Securities in a Company Public Sale (other than in an
Underwritten Offering, in which case Section 2.07(f) shall apply) by giving
written notice to the Company of its request to withdraw; provided, that (i)
such request must be made in writing at least two (2) Business Days prior to the
effectiveness of such Registration Statement and (ii) such withdrawal shall be
irrevocable and, after making such withdrawal, the Holder shall no longer have
any right to include Registrable Securities in the Company Public Sale as to
which such withdrawal was made.

 

Section 2.05.         Black-out Periods.

 

(a)          Black-out Periods for Holders. In the event of a Company Public
Sale of the Company’s equity securities in an Underwritten Offering, the Holders
agree, if requested by the managing underwriter or underwriters in such
Underwritten Offering, not to effect any public sale or distribution of any
securities (except, in each case, as part of the applicable Registration, if
permitted) that are the same as or similar to those being Registered in
connection with such Company Public Sale, or any securities convertible into or
exchangeable or exercisable for such securities, during the period beginning
seven (7) days before and ending ninety (90) days (or such lesser period as may
be permitted by the Company or such managing underwriter or underwriters) after,
the effective date of the Registration Statement filed in connection with such
Registration, to the extent timely notified in writing by the Company or the
managing underwriter or underwriters; provided, however, such restrictions shall
not apply to (i) distributions-in-kind to a Holder’s partners or members but
only if such partners or members agree to be bound by the restrictions therein;
and (ii) transfers to Affiliates for so long as they remain Affiliates, but only
if such Affiliates agree to be bound by the restrictions herein as a Permitted
Assignee pursuant to Section 3.04.

 

 12 

 

 

(b)          Black-out Period for the Company and Others. In the case of an
Underwritten Offering for Registrable Securities pursuant to Section 2.07(a),
the Company and the Holders agree, if requested by the managing underwriter or
underwriters with respect to such Registration, not to effect any public sale or
distribution of any securities that are the same as or similar to those being
Registered, or any securities convertible into or exchangeable or exercisable
for such securities, during the period beginning seven (7) days before, and
ending ninety (90) days (or such lesser period as may be permitted by such
managing underwriter or underwriters) after, the effective date of the
Registration Statement filed in connection with such Registration (or, in the
case of an offering under a Shelf Registration Statement, the date of the
closing under the underwriting agreement in connection therewith), to the extent
timely notified in writing by the managing underwriter or underwriters.
Notwithstanding the foregoing, the Company may effect a public sale or
distribution of securities of the type described above and during the periods
described above if such sale or distribution is made pursuant to any
Registration of securities for offering and sale to employees or directors of
the Company pursuant to any employee stock plan or other employee benefit plan
arrangement. The Company agrees to use its reasonable best efforts to obtain
from (i) to the extent, but only to the extent, any such holder holds more than
5% of the outstanding Common Shares, each holder of restricted securities of the
Company which securities are the same as or similar to the Registrable
Securities being Registered, or any restricted securities convertible into or
exchangeable or exercisable for any of such securities, and (ii) all directors
and executive officers of the Company, an agreement not to effect any public
sale or distribution of such securities during any such period referred to in
this paragraph, except as part of any such Registration, if permitted. Without
limiting the foregoing (but subject to Section 2.08), if after the date hereof
the Company grants any Person (other than a Holder) any rights to demand or
participate in a Registration, the Company agrees that the agreement with
respect thereto shall include such Person’s agreement to comply with any
black-out period required by this Section 2.05 as if it were a Holder hereunder.

 

Section 2.06.         Registration Procedures.

 

(a)          In connection with the Company’s obligations under Sections 2.01,
2.02, 2.03 and 2.04, the Company shall use its reasonable best efforts to effect
any Registration and to permit the sale of any Registrable Securities in
accordance with the intended method or methods of distribution thereof as
expeditiously as reasonably practicable, and in connection therewith the Company
shall:

 

(i)          prepare the required Registration Statement including all exhibits
and financial statements required under the Securities Act to be filed
therewith, and before filing a Registration Statement or Prospectus, or any
amendments or supplements thereto, (x) furnish to the underwriters, if any, and
to Participating Holders, copies of all documents prepared to be filed, which
documents shall be subject to the review of such underwriters and such Holders
and their respective counsel; (y) except in the case of a Registration under
Section 2.04, not file any Registration Statement or Prospectus or amendments or
supplements thereto to which the underwriters (if any) shall reasonably object;
and (z) make such changes in such documents concerning the Holders prior to the
filing thereof as such Holders, or their counsel, may reasonably request;

 

 13 

 

 

(ii)         prepare and file with the SEC such pre- and post-effective
amendments to such Registration Statement and supplements to the Prospectus as
may be (x) reasonably requested by any Participating Holder (to the extent such
request relates to information relating to such Holder) or (y) necessary to keep
such Registration effective for such period as required by Section 2.02(d) or
Section 2.03(b), whichever is applicable, and comply with provisions of the
applicable securities laws with respect to the sale or other disposition of all
securities covered by such Registration Statement during such period in
accordance with the intended method or methods of disposition by the sellers
thereof set forth in such Registration Statement;

 

(iii)        notify the Participating Holders and the managing underwriter or
underwriters, if any, and (if requested) confirm such advice in writing and
provide copies of the relevant documents, as soon as reasonably practicable
after notice thereof is received by the Company (a) when the applicable
Registration Statement or any amendment thereto has been filed or becomes
effective, and when the applicable Prospectus or any amendment or supplement to
such Prospectus has been filed, (b) of any written comments by the SEC or any
request by the SEC or any other federal or state governmental authority for
amendments or supplements to such Registration Statement or such Prospectus or
for additional information, (c) of the issuance by the SEC of any stop order
suspending the effectiveness of such Registration Statement or any order by the
SEC or any other regulatory authority preventing or suspending the use of any
preliminary or final Prospectus or the initiation or threatening of any
proceedings for such purposes and (d) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Registrable Securities for offering or sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose;

 

(iv)        promptly notify the Participating Holders and the managing
underwriter or underwriters, if any, when the Company becomes aware of the
happening of any event as a result of which the applicable Registration
Statement or the Prospectus included in such Registration Statement (as then in
effect) contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements therein (in the case of such
Prospectus and any preliminary Prospectus, in light of the circumstances under
which they were made) not misleading, when any Issuer Free Writing Prospectus
includes information that may conflict with the information contained in the
Registration Statement, or, if for any other reason it shall be necessary during
such time period to amend or supplement such Registration Statement or
Prospectus in order to comply with the Securities Act and, in either case as
promptly as reasonably practicable thereafter, prepare and file with the SEC,
and furnish without charge to the Participating Holders and the managing
underwriter or underwriters, if any, an amendment or supplement to such
Registration Statement or Prospectus which shall correct such misstatement or
omission or effect such compliance;

 

(v)         to the extent the Company is eligible under the relevant provisions
of Rule 430B under the Securities Act, if the Company files any Shelf
Registration Statement, the Company shall include in such Shelf Registration
Statement such disclosures as may be required by Rule 430B under the Securities
Act (referring to the unnamed selling security holders in a generic manner by
identifying the initial offering of the securities to the Holders) in order to
ensure that the Holders may be added to such Shelf Registration Statement at a
later time through the filing of a Prospectus supplement rather than a
post-effective amendment;

 

 14 

 

 

(vi)        use its reasonable best efforts to prevent, or obtain the withdrawal
of, any stop order or other order suspending the use of any preliminary or final
Prospectus;

 

(vii)       promptly incorporate in a Prospectus supplement, Issuer Free Writing
Prospectus or post-effective amendment to a Registration Statement such
information as the managing underwriter or underwriters agree should be included
therein relating to the plan of distribution with respect to such Registrable
Securities; and make all required filings of such Prospectus supplement, Issuer
Free Writing Prospectus or post-effective amendment to a Registration Statement
as soon as reasonably practicable after being notified of the matters to be
incorporated in such Prospectus supplement, Issuer Free Writing Prospectus or
post-effective amendment to a Registration Statement;

 

(viii)      furnish to each Participating Holder and each underwriter, if any,
without charge, as many conformed copies as such Holder or underwriter may
reasonably request of the applicable Registration Statement and any amendment or
post-effective amendment or supplement thereto, including financial statements
and schedules, all documents incorporated therein by reference and all exhibits
(including those incorporated by reference);

 

(ix)         deliver to each Participating Holder and each underwriter, if any,
without charge, as many copies of the applicable Prospectus (including each
preliminary prospectus) and any amendment or supplement thereto as such Holder
or underwriter may reasonably request (it being understood that the Company
consents to the use of such Prospectus or any amendment or supplement thereto by
such Holder and the underwriters, if any, in connection with the offering and
sale of the Registrable Securities covered by such Prospectus or any amendment
or supplement thereto) and such other documents as such Holder or underwriter
may reasonably request in order to facilitate the disposition of the Registrable
Securities by such Holder or underwriter, it being understood that the Company
consents to the use of such Prospectus or any amendment or supplement thereto by
such Participating Holder and the underwriters, if any, in connection with the
offering and sale of the Registrable Securities covered by such Prospectus or
any amendment or supplement thereto;

 

(x)          on or prior to the date on which the applicable Registration
Statement is declared effective, use its reasonable best efforts to register or
qualify, and cooperate with the Participating Holders, the managing underwriter
or underwriters, if any, and their respective counsel, in connection with the
registration or qualification of such Registrable Securities for offer and sale
under the securities or “Blue Sky” laws of each state and other jurisdiction of
the United States as any Participating Holder or managing underwriter or
underwriters, if any, or their respective counsel reasonably request in writing
and do any and all other acts or things reasonably necessary or advisable to
keep such registration or qualification in effect for such period as required by
Section 2.02(d) or Section 2.03(b), whichever is applicable, provided that the
Company shall not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any action which would
subject it to taxation or general service of process in any such jurisdiction
where it is not then so subject;

 

(xi)         cooperate with the Participating Holders and the managing
underwriter or underwriters, if any, to facilitate the timely removal of any
restrictive legends from Registrable Securities to be sold; and enable such
Registrable Securities to be in such denominations and registered in such names
as the managing underwriters may request at least two (2) Business Days prior to
any sale of Registrable Securities to the underwriters;

 15 

 

 

(xii)        use its reasonable best efforts to cause the Registrable Securities
covered by the applicable Registration Statement to be registered with or
approved by such other governmental agencies or authorities as may be necessary
to enable the seller or sellers thereof or the underwriter or underwriters, if
any, to consummate the disposition of such Registrable Securities;

 

(xiii)       not later than the effective date of the applicable Registration
Statement, provide a CUSIP number for all Registrable Securities (and if
applicable, provide the applicable transfer agent with printed certificates for
the Registrable Securities which are in a form eligible for deposit with The
Depository Trust Company);

 

(xiv)      make such representations and warranties to the Participating Holders
and the underwriters or agents, if any, in form, substance and scope as are
customarily made by issuers in public offerings then being undertaken;

 

(xv)       enter into such customary agreements (including an underwriting
agreement in customary form) and take all such other actions as the Initiating
Holder or the managing underwriter or underwriters, if any, reasonably request
in order to expedite or facilitate the registration and disposition of such
Registrable Securities;

 

(xvi)      obtain for delivery to the underwriter or underwriters, if any, with
copies to the Participating Holders, an opinion or opinions from counsel for the
Company dated the effective date of the Registration Statement or, in the event
of an Underwritten Offering, the date of the closing under the underwriting
agreement, in customary form, scope and substance;

 

(xvii)     in the case of an Underwritten Offering, (a) obtain for delivery to
the Company and the managing underwriter or underwriters, with copies to the
Participating Holders, a comfort letter from the Company’s independent certified
public accountants or independent auditors (and, if necessary, any other
independent certified public accountants or independent auditors of any
subsidiary of the Company or any business acquired by the Company for which
financial statements and financial data are, or are required to be, included in
the Registration Statement) in customary form and covering such matters of the
type customarily covered by cold comfort letters as the managing underwriter or
underwriters reasonably request, dated the date of execution of the underwriting
agreement and brought down to the closing under the underwriting agreement and
(b) obtain the required consents from the Company’s independent certified public
accountants and, if applicable, independent auditors to include the accountants’
or auditors’ report, as applicable, relating to the specified financial
statements in the Registration Statement and to be named as an expert in the
Registration Statement;

 

(xviii)    cooperate with each Participating Holder and each underwriter, if
any, participating in the disposition of such Registrable Securities and their
respective counsel in connection with any filings required to be made with
FINRA;

 

 16 

 

 

(xix)       use its reasonable best efforts to comply with all applicable
securities laws and make available to its security holders, as soon as
reasonably practicable, an earnings statement satisfying the provisions of
Section 11(a) of the Securities Act and the rules and regulations promulgated
thereunder;

 

(xx)        provide and cause to be maintained a transfer agent and registrar
for all Registrable Securities covered by the applicable Registration Statement
from and after a date not later than the effective date of such Registration
Statement;

 

(xxi)       use its reasonable best efforts to cause all Registrable Securities
covered by the applicable Registration Statement to be listed on each securities
exchange on which any of the Company’s securities are then listed or quoted and
on each inter-dealer quotation system on which any of the Company’s securities
are then quoted;

 

(xxii)      make available upon reasonable notice at reasonable times and for
reasonable periods for inspection, by any underwriter participating in any
disposition to be effected pursuant to such Registration Statement and by any
attorney, accountant or other agent retained by Brookfield, the Advisor, the
Property Manager or the Demanding Holders, as applicable, or any such
underwriter, all pertinent financial and other records, pertinent corporate
documents and properties of the Company, and cause all of the Company’s
officers, directors and employees and the independent public accountants who
have certified its financial statements to make themselves available to discuss
the business of the Company and to supply all information reasonably requested
by any such Person in connection with such Registration Statement as shall be
necessary to enable them to exercise their due diligence responsibility;
provided that any such Person gaining access to information regarding the
Company pursuant to this Section 2.06(a)(xxii) shall agree to hold in strict
confidence and shall not make any disclosure or use any information regarding
the Company that the Company determines in good faith to be confidential, and of
which determination such Person is notified, unless (v) the release of such
information is requested or required by deposition, interrogatory, requests for
information or documents by a governmental entity, subpoena or similar process,
(w) disclosure of such information, in the opinion of counsel to such Person, is
otherwise required by law, (x) such information is or becomes publicly known
other than through a breach of this Agreement or any other obligation to
maintain confidence of which such Person has knowledge, (y) such information is
or becomes available to such Person on a non-confidential basis from a source
other than the Company or (z) such information is independently developed by
such Person without reference to the confidential information provided by the
Company or its Representatives;

 

(xxiii)     in the case of an Underwritten Offering, cause the senior executive
officers of the Company to participate in the customary “road show”
presentations that may be reasonably requested by the managing underwriter or
underwriters in any such Underwritten Offering and otherwise to facilitate,
cooperate with, and participate in each proposed offering contemplated herein
and customary selling efforts related thereto;

 

(xxiv)    take no direct or indirect action prohibited by Regulation M under the
Exchange Act;

 

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(xxv)     take all reasonable action to ensure that any Issuer Free Writing
Prospectus utilized in connection with any Registration complies in all material
respects with the Securities Act, is filed in accordance with the Securities Act
to the extent required thereby, is retained in accordance with the Securities
Act to the extent required thereby and, when taken together with the related
Prospectus, will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and

 

(xxvi)    take all such other commercially reasonable actions as are necessary
or advisable in order to expedite or facilitate the disposition to the Holders
of Registrable Securities in accordance with the terms of this Agreement.

 

(b)          The Company may require each Participating Holder to furnish to the
Company such information regarding the distribution of such securities and such
other information relating to such Holder and its ownership of Registrable
Securities as the Company may from time to time reasonably request in writing
and the Company may exclude from such Registration or sale the Registrable
Securities of any such Holder who unreasonably fails to furnish such information
within a reasonable time after receiving such request. Each Participating Holder
agrees to furnish such information to the Company and to cooperate with the
Company as reasonably necessary to enable the Company to comply with the
provisions of this Agreement.

 

(c)          Each Holder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section
2.06(a)(iv), such Holder will forthwith discontinue disposition of Registrable
Securities pursuant to such Registration Statement until such Holder’s receipt
of the copies of the supplemented or amended Prospectus contemplated by Section
2.06(a)(iv), or until such Holder is advised in writing by the Company that the
use of the Prospectus may be resumed, and if so directed by the Company, such
Holder shall deliver to the Company (at the Company’s expense) all copies, other
than permanent file copies then in such Holder’s possession, of the Prospectus
covering such Registrable Securities current at the time of receipt of such
notice. In the event the Company shall give any such notice, the period during
which the applicable Registration Statement is required to be maintained
effective shall be extended by the number of days during the period from and
including the date of the giving of such notice to and including the date when
each seller of Registrable Securities covered by such Registration Statement
either receives the copies of the supplemented or amended Prospectus
contemplated by Section 2.06(a)(iv) or is advised in writing by the Company that
the use of the Prospectus may be resumed.

 

(d)          To the extent that Brookfield, the Advisor or the Property Manager
or any of their Affiliates, as applicable, is deemed to be an underwriter of
Registrable Securities pursuant to any SEC comments or policies or otherwise,
the Company agrees that (1) the indemnification and contribution provisions
contained in this Agreement shall be applicable to the benefit of Brookfield,
the Advisor or the Property Manager, or one of their Affiliates, as applicable,
in its role as deemed underwriter in addition to its capacity as Holder and
(2) Brookfield, the Advisor or the Property Manager, or any of and their
Affiliates , as applicable, shall be entitled to conduct such activities which
it would normally conduct in connection with satisfying its “due diligence”
defense as an underwriter in connection with an offering of securities
registered under the Securities Act, including conducting due diligence and the
receipt of customary opinions and comfort letters.

 

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Section 2.07.         Underwritten Offerings.

 

(a)          Underwritten Offering Requests. Upon the written request of any
Initiating Holder from time to time for an Underwritten Offering under a
Registration Statement filed in accordance with the terms of this Agreement (an
“Underwritten Offering Request”), the Company shall (A) promptly give written
notice of such Underwritten Offering Request to the other Holders and (B)
cooperate with such Initiating Holder and any underwriter, as well as any other
Holders that have requested that their Registrable Securities be included in
such Underwritten Offering within two (2) Business Days after receiving the
notice from the Company in clause (A) above, in effecting an Underwritten
Offering under any Registration Statement filed pursuant to this Agreement as
promptly as reasonably practicable following receipt of such Underwritten
Offering Request; provided, however, that (x) all Holders shall not be entitled
to make in the aggregate more than three (3) Underwritten Offering Requests that
result in priced Underwritten Offerings in any twelve (12) month period; and (y)
any such Initiating Holder may withdraw or abandon the Underwritten Offering
Request at any time prior to any Underwritten Offering becoming priced. Each
Underwritten Offering Request will specify the number of Registrable Securities
proposed by the Holder to be included in such Underwritten Offering, the
intended method of distribution and the estimated gross proceeds of such
Underwritten Offering, which may not be less than $50,000,000. If requested by
the underwriters for any Underwritten Offering, the Company shall enter into an
underwriting agreement with such underwriters for such offering, such agreement
to be reasonably satisfactory in substance and form to the Company, the
Initiating Holder and the underwriters, and to contain such representations and
warranties by the Company and such other terms as are generally prevailing in
agreements of that type, including indemnities no less favorable to the
recipient thereof than those provided in Section 2.10. Participating Holders
shall cooperate with the Company in the negotiation and shall give consideration
to the reasonable suggestions of the Company regarding the form thereof. Such
Holders shall be parties to such underwriting agreement, which underwriting
agreement shall (i) contain such representations and warranties by, and the
other agreements on the part of, the Company to and for the benefit of such
Holders as are customarily made by issuers to selling stockholders in secondary
underwritten public offerings and (ii) provide that any or all of the conditions
precedent to the obligations of such underwriters under such underwriting
agreement also shall be conditions precedent to the obligations of such Holders.
Such Holders shall not be required to make any representations or warranties to
or agreements with the Company or the underwriters other than representations,
warranties or agreements regarding such Holders, such Holder’s title to the
Registrable Securities, such Holder’s intended method of distribution and any
other representations required to be made by such Holder under applicable law,
and the aggregate amount of the liability of such Holder shall not exceed such
Holder’s net proceeds from such Underwritten Offering.

 

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(b)          Priority.

 

(i)          Notwithstanding any other provision of this Section 2.07, in the
case of an Underwritten Offering pursuant to an Underwritten Offering Request,
if the managing underwriter or underwriters of an Underwritten Offering advise
the selling Holders that, in its or their opinion, the number of securities
requested to be included in such Underwritten Offering exceeds the number which
can be sold in such Underwritten Offering without being likely to have a
significant adverse effect on the price, timing or distribution of the
securities offered or the market for the securities offered, the securities to
be included in such Underwritten Offering (i) first, shall be allocated to the
Initiating Holder and, if the Demanding Holders are the Initiating Holder, pro
rata among the Demanding Holders that have requested to participate in such
Underwritten Offering based on the relative number of Registrable Securities
then held by each such Holder (provided that any securities thereby allocated to
a Holder that exceed such Holder’s request shall be reallocated among the
remaining requesting Holders in like manner) and (ii) next, and only if all the
securities referred to in clause (i) have been included, the number of
securities that the Company and any other Holder that has a right to participate
in such Underwritten Offering proposes to include in such Underwritten Offering
that, in the opinion of the managing underwriter or underwriters can be sold
without having such adverse effect.

 

(ii) The Company will have the right to delay an Underwritten Offering by an
Initiating Holder following receipt of an Underwritten Offering Request if the
Company, not more than 30 days prior to receipt of such request indicated intent
(either by (i) circulating to prospective underwriters and their counsel a draft
of a Registration Statement for a primary offering of equity securities of the
Company, (ii) soliciting bids for a primary offering of equity securities of the
Company, or (iii) otherwise reaching an understanding with an underwriter with
respect to a primary offering of equity securities of the Company), and intends
to effect its own Underwritten Offering by giving the Initiating Holder written
notice of such intent (a “Stand-Down Notice”), whereby the Company’s obligation
to cooperate with the Initiating Holder and any underwriter in effecting an
Underwritten Offering shall be suspended until the later of the Resumption Date
(as defined below) and the expiration of any lock-up agreement required to be
entered into by the Initiating Holder pursuant to Section 2.05; provided,
however, that (x) the Company will not be entitled to deliver a Stand-Down
Notice in respect of an Underwritten Offering Request later than 5 p.m. New York
time on the third (3rd) Business Day following receipt of such Underwritten
Offering Request; (y) the Company will not be entitled to more than one (1)
Stand-Down Notice in any twelve (12) month period; and (z) the Company will be
deemed to have rescinded the Stand-Down Notice automatically, whereby the
Company’s obligation to cooperate with the Initiating Holder and any underwriter
in effecting an Underwritten Offering shall resume, if (I) the Launch Date in
respect of the Company’s Underwritten Offering has not occurred by the end of
the tenth (10th) Business Day after the date of the Underwritten Offering
Request or (II) the Company’s Underwritten Offering has not been priced by the
end of the fifth (5th) Business Day after the Launch Date (the date following
automatic rescission of a Stand-Down Notice pursuant to either clause (I) and
clause (II) above, a “Resumption Date”). The Holders acknowledge and agree that
the receipt of any Stand-Down Notice may constitute material non-public
information regarding the Company and shall keep the existence and contents of
any Stand-Down Notice confidential.

 

 20 

 

 

(c)          Piggyback Registrations. In connection with any Underwritten
Offering of shares of the Company’s equity Securities pursuant to Section 2.04,
the Company shall not be required to include any Registrable Securities in such
Underwritten Offering unless such selling Holders accept the terms of the
Underwritten Offering as agreed upon between the Company and its underwriters.
In connection with any proposed Underwritten Offering of Registrable Securities
included in a Piggyback Registration pursuant to Section 2.04, if the managing
underwriter or underwriters of such proposed Underwritten Offering informs the
Company in writing (a copy of which shall be provided to the Holders) that, in
its or their opinion, the number of securities which such Holders and any other
Persons intend to include in such Underwritten Offering exceeds the number which
can be sold in such Underwritten Offering without being likely to have a
significant adverse effect on the price, timing or distribution of the
securities offered or the market for the securities offered, then the securities
to be included in such Underwritten Offering shall be allocated (i) first, 100%
of the securities proposed to be sold in such Underwritten Offering by the
Company or (subject to Section 2.08) any Person (other than a Holder) exercising
a contractual right to demand Registration, as the case may be, proposes to
sell, and (ii) second, and only if all the securities referred to in clause (i)
have been included, the number of Registrable Securities that, in the opinion of
such managing underwriter or underwriters, can be sold without having such
adverse effect, with such number to be allocated pro rata among the Holders that
have requested to participate in such Underwritten Offering based on the
relative number of Registrable Securities then held by each such Holder
(provided that any securities thereby allocated to a Holder that exceed such
Holder’s request shall be reallocated among the remaining requesting Holders in
like manner) and (iii) third, and only if all of the Registrable Securities
referred to in clause (ii) have been included in such Underwritten Offering, any
other securities eligible for inclusion in such Underwritten Offering.

 

(d)          Participation in Underwritten Registrations. Subject to the
provisions of Section 2.07(a) and Section 2.07(c) above and this Section
2.07(d), no Person may participate in any Underwritten Offering hereunder unless
such Person (i) agrees to sell such Person’s securities on the basis provided in
any underwriting arrangements approved by the Persons entitled to approve such
arrangements and (ii) promptly completes and executes all questionnaires, powers
of attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements.

 

(e)          Underwriters, Price and Underwriting Discounts. In the case of an
Underwritten Offering under Section 2.07(a), the price, underwriting discount
and other financial terms for the Registrable Securities shall be determined in
good faith by the Initiating Holder, and the Initiating Holder shall have the
right to select one or more underwriters for such Underwritten Offering;
provided, that any underwriter must be approved by the Company, which approval
will not be unreasonably withheld, conditioned or delayed. In the case of any
Underwritten Offering under Section 2.04, the Company shall have the sole right
to determine the underwriters and all other matters affecting the Underwritten
Offering, including the price, underwriting discount and other financial terms
of the Underwritten Offering.

 

(f)          Withdrawal. In the case of any Underwritten Offering under Section
2.07(a) or 2.04, each of the Holders may withdraw all or part of their
Registrable Securities from such Underwritten Offering any Holder may elect to
withdraw all or part of its Registrable Securities from such Underwritten
Offering by giving written notice to the Company of its request to withdraw;
provided, that (i) such request must be made in writing at least two (2)
Business Days prior to the earlier of the anticipated Launch Date and the
anticipated pricing or trade date of such Underwritten Offering and (ii) such
withdrawal shall be irrevocable and, after making such withdrawal, the Holder
shall no longer have any right to include Registrable Securities in the
Underwritten Offering as to which such withdrawal was made.

 

 21 

 

 

Section 2.08.         No Inconsistent Agreements. The Company shall not
hereafter enter into, and, following the closing of the transactions
contemplated by the Framework Agreement, is not currently a party to, any
agreement with respect to its securities that is inconsistent with the rights
granted to the Holders by this Agreement.

 

Section 2.09.         Registration Expenses. All expenses incident to the
Company’s performance of or compliance with this Agreement shall be paid by the
Company, including (i) all registration and filing fees, and any other fees and
expenses associated with filings required to be made with the SEC or FINRA, (ii)
all fees and expenses in connection with compliance with any securities or “Blue
Sky” laws (including reasonable fees and disbursements of counsel for the
underwriters in connection with blue sky qualifications of the Registrable
Securities), (iii) expenses in connection with the preparation, printing,
mailing and delivery of any Registration Statements, Prospectuses, Issuer Free
Writing Prospectus and other documents in connection therewith and any
amendments or supplements thereto and expenses of printing certificates for the
Registrable Securities in a form eligible for deposit with The Depository Trust
Company, (iv) all fees and disbursements of counsel for the Company and of all
independent certified public accountants of the Company and any subsidiaries of
the Company (including the expenses of any special audit and cold comfort
letters required by or incident to such performance), (v) Securities Act
liability insurance or similar insurance if the Company so desires or the
underwriters so require in accordance with then customary underwriting practice
(vi) all fees and expenses incurred in connection with the listing of the
Registrable Securities on any securities exchange or quotation of the
Registrable Securities on any inter-dealer quotation system, (vii) all
reasonable and documented fees and disbursements of one legal counsel for
Brookfield and, if Brookfield is not the Initiating Holder, the Initiating
Holder, not to exceed $100,000 in the aggregate for all jurisdictions in
connection with the filing of the Shelf Registration Statement or any
Underwritten Offering, (viii) any reasonable fees and disbursements of
underwriters customarily paid by issuers or sellers of securities, (ix) all fees
and expenses of any special experts or other Persons retained by the Company in
connection with any Registration; (x) all of the Company’s internal expenses
(including all salaries and expenses of its officers and employees performing
legal or accounting duties); and (xi) if the underwriter for any Underwritten
Offering reasonably determines a “road show” is necessary, all expenses incurred
by the Company related to the road show for such Underwritten Offering, and all
reasonable and documented out of pocket expenses of Brookfield and, if
Brookfield is not the Initiating Holder, the Initiating Holder to the extent,
but only to the extent, the managing underwriter explicitly requests the
participation of either Brookfield or the Initiating Holder in such road show,
including all travel, meals and lodging of the Company. All such expenses are
referred to herein as “Registration Expenses.” Notwithstanding the foregoing,
the Company shall not be required to pay for any Registration Expenses in
connection with any Registration begun pursuant to Sections 2.02 or 2.03(a) if
the applicable request is subsequently withdrawn at the request of the
Initiating Holder (in which case the Initiating Holder shall bear such
expenses), unless the Holders agree to forfeit their right to one Registration
provided for in Section 2.01(c). The Company shall not be required to pay
underwriting discounts and commissions and transfer taxes, if any, attributable
to the sale of Registrable Securities.

 

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Section 2.10.         Indemnification.

 

(a)          Indemnification by the Company. The Company agrees to indemnify and
hold harmless, to the full extent permitted by law, each Holder, each member,
limited or general partner thereof, each member, limited or general partner of
each such member, limited or general partner, each of their respective
Affiliates, officers, directors, shareholders, employees, advisors, and agents
and each Person who controls (within the meaning of the Securities Act or the
Exchange Act) such Persons and each of their respective Representatives from and
against any and all losses, penalties, judgments, suits, costs, claims, damages,
liabilities and expenses, joint or several (including reasonable costs of
investigation and legal expenses) (each, a “Loss” and collectively “Losses”)
arising out of or based upon (i) any untrue or alleged untrue statement of a
material fact contained in any Registration Statement under which such
Registrable Securities were Registered under the Securities Act (including any
final, preliminary or summary Prospectus contained therein or any amendment
thereof or supplement thereto or any documents incorporated by reference
therein) or any other disclosure document produced by or on behalf of the
Company or any of its subsidiaries including, without limitation, reports and
other documents filed under the Exchange Act, (ii) any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of a Prospectus or
preliminary Prospectus, in light of the circumstances under which they were
made) not misleading, or (iii) any actions or inactions or proceedings in
respect of the foregoing whether or not such indemnified party is a party
thereto; provided, that the Company shall not be liable to any particular
indemnified party (A) to the extent that any such Loss arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in any such Registration Statement or other document in reliance
upon and in conformity with written information furnished to the Company by an
indemnified party expressly for use in the preparation thereof or (B) to the
extent that any such Loss arises out of or is based upon an untrue statement or
omission in a preliminary Prospectus relating to Registrable Securities, if a
Prospectus (as then amended or supplemented) that would have cured the defect
was furnished to the indemnified party from whom the Person asserting the claim
giving rise to such Loss purchased Registrable Securities prior to the written
confirmation of the sale of the Registrable Securities to such Person and a copy
of such Prospectus (as amended and supplemented) was not sent or given by or on
behalf of such indemnified party to such Person at or prior to the written
confirmation of the sale of the Registrable Securities to such Person. This
indemnity shall be in addition to any liability the Company may otherwise have.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of such Holder or any indemnified party and
shall survive the transfer of such securities by such Holder.

 

 23 

 

 

(b)          Indemnification by the Participating Holders. Each Participating
Holder agrees (severally and not jointly) to indemnify and hold harmless, to the
fullest extent permitted by law, the Company, its directors and officers and
each Person who controls the Company (within the meaning of the Securities Act
or the Exchange Act) from and against any Losses resulting from(i) any untrue
statement of a material fact in any Registration Statement under which such
Registrable Securities were Registered under the Securities Act (including any
final, preliminary or summary Prospectus contained therein or any amendment
thereof or supplement thereto or any documents incorporated by reference
therein), or (ii) any omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of a
Prospectus or preliminary Prospectus, in light of the circumstances under which
they were made) not misleading, in each case, to the extent, but only to the
extent, that such untrue statement or omission is contained in any information
furnished in writing by such Holder to the Company specifically for inclusion in
such Registration Statement and has not been corrected in a subsequent writing
prior to or concurrently with the sale of the Registrable Securities to the
Person asserting the claim. In no event shall the liability of such Holder
hereunder be greater in amount than the dollar amount of the net proceeds
received by such Holder under the sale of Registrable Securities giving rise to
such indemnification obligation less any amounts paid by such Participating
Holder pursuant to Section 2.10(d) and any amounts paid by such Holder as a
result of liabilities incurred under the underwriting agreement, if any, related
to such sale. The Company shall be entitled to receive indemnities from
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, to the same extent as provided
above (with appropriate modification) with respect to information furnished in
writing by such Persons specifically for inclusion in any Prospectus or
Registration Statement.

 

(c)          Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder shall (i) give prompt written notice to the
indemnifying party of any claim with respect to which it seeks indemnification
(provided that any delay or failure to so notify the indemnifying party shall
relieve the indemnifying party of its obligations hereunder only to the extent,
if at all, that it is prejudiced by reason of such delay or failure) and (ii)
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party; provided that any Person
entitled to indemnification hereunder shall have the right to select and employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such Person unless (A)
the indemnifying party has agreed in writing to pay such fees or expenses, (B)
the indemnifying party shall have failed to assume the defense of such claim
within a reasonable time after receipt of notice of such claim from the Person
entitled to indemnification hereunder and employ counsel reasonably satisfactory
to such Person, (C) the indemnified party has reasonably concluded (based upon
advice of its counsel) that there may be legal defenses available to it or other
indemnified parties that are different from or in addition to those available to
the indemnifying party, or (D) in the reasonable judgment of any such Person
(based upon advice of its counsel) a conflict of interest may exist between such
Person and the indemnifying party with respect to such claims (in which case, if
the Person notifies the indemnifying party in writing that such Person elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such claim
on behalf of such Person). If the indemnifying party assumes the defense, the
indemnifying party shall not have the right to settle such action without the
consent of the indemnified party, such consent not to be unreasonably withheld,
conditioned or delayed. No indemnifying party shall consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such indemnified party
of an unconditional release from all liability in respect to such claim or
litigation without the prior written consent of such indemnified party, such
consent not to be unreasonably withheld, conditioned or delayed. If such defense
is not assumed by the indemnifying party, the indemnifying party will not be
subject to any liability for any settlement made without its prior written
consent, but if settled with such consent or if there is a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
It is understood that the indemnifying party or parties shall not, except as
specifically set forth in this Section 2.10(c), in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees, disbursements or other charges of more than one separate firm
admitted to practice in such jurisdiction at any one time unless (x) the
employment of more than one counsel has been authorized in writing by the
indemnifying party or parties, (y) an indemnified party has reasonably concluded
(based on the advice of counsel) that there may be legal defenses available to
it that are different from or in addition to those available to the other
indemnified parties or (z) a conflict or potential conflict exists or may exist
(based upon advice of counsel to an indemnified party) between such indemnified
party and the other indemnified parties, in each of which cases the indemnifying
party shall be obligated to pay the reasonable fees and expenses of such
additional counsel or counsels.

 

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(d)          Contribution.   If for any reason the indemnification provided for
in paragraphs (a) and (b) of this Section 2.10 is unavailable to an indemnified
party or insufficient in respect of any Losses referred to therein (other than
as a result of exceptions contained in paragraphs (a) and (b) of this Section
2.10), then the indemnifying party shall contribute to the amount paid or
payable by the indemnified party as a result of such Loss in such proportion as
is appropriate to reflect the relative fault of the indemnifying party on the
one hand and the indemnified party or parties on the other hand in connection
with the acts, statements or omissions that resulted in such Losses, (as well as
any other relevant equitable considerations). In connection with any
Registration Statement filed with the SEC by the Company, the relative fault of
the indemnifying party on the one hand and the indemnified party on the other
hand shall be determined by reference to, among other things, whether any untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The parties hereto agree that it would not be just or
equitable if contribution pursuant to this Section 2.10(d) were determined by
pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in this Section 2.10(d). No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation. The amount paid or
payable by an indemnified party as a result of the Losses referred to in Section
2.10(a) and Section 2.10(b) shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 2.10(d), in
connection with any Registration Statement filed by the Company, a Participating
Holder shall not be required to contribute any amount in excess of the dollar
amount of the net proceeds received by such Holder under the sale of Registrable
Securities giving rise to such contribution obligation less any amounts paid by
such Holder pursuant to Section 2.10(b) and any amounts paid by such Holder as a
result of liabilities incurred under the underwriting agreement, if any, related
to such sale. If indemnification is available under this Section 2.10and
sufficient in respect of all Losses referred to under this Section 2.10, the
indemnifying parties shall indemnify each indemnified party to the full extent
provided in Section 2.10(a) and Section 2.10(b) hereof without regard to the
provisions of this Section 2.10(d). The remedies provided for in this Section
2.10 are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any indemnified party at law or in equity.

 

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Section 2.11.         Rules 144 and 144A and Regulation S. The Company covenants
that it will file the reports required to be filed by it under the Securities
Act and the Exchange Act and the rules and regulations adopted by the SEC
thereunder (or, if the Company is not required to file such reports, it will,
upon the reasonable request of Brookfield, the Advisor or the Property Manager
make publicly available such necessary information for so long as necessary to
permit sales pursuant to Rules 144, 144A or Regulation S under the Securities
Act, as such Rules may be amended from time to time), and it will take such
further action as Brookfield, the Advisor or the Property Manager may reasonably
request, all to the extent required from time to time to enable Brookfield, the
Advisor or the Property Manager to sell Registrable Securities without
Registration under the Securities Act within the limitation of the exemptions
provided by (i) Rules 144, 144A or Regulation S under the Securities Act, as
such Rules may be amended from time to time, or (ii) any similar rule or
regulation hereafter adopted by the SEC. Upon the reasonable request of a
Holder, the Company will deliver to such Holder a written statement as to
whether it has complied with such requirements and, if not, the specifics
thereof.

 

Article III

 

MISCELLANEOUS

 

Section 3.01.         Term. Except for the obligations to maintain
confidentiality set forth in Section 2.06(a)(xxiii), the provisions of Section
2.10 and all provisions of this Article III, which shall survive any such
termination, this Agreement shall terminate upon the later of the expiration of
the Shelf Period and such time as all Registrable Securities cease to be
Registrable Securities; provided, however, any obligations of the Company to any
Holder will terminate as to such Holder when such Holder no longer owns any
Registrable Securities.

 

Section 3.02.         Notices. All notices, requests and other communications to
any party hereunder shall be in writing and shall be deemed given if delivered
personally, by facsimile (which transmission is confirmed), emailed (which
receipt is confirmed) or sent by overnight courier (providing proof of
delivery), hand delivery or certified or registered mail (return receipt
requested and first-class postage prepaid), to the parties at the following
addresses:

 

if to the Company: Hospitality Investors Trust, Inc.   405 Park Avenue, 14th
Floor   New York, NY 10022   Attention:  Paul Hughes  
Email:        PHughes@ar-global.com   Facsimile:  (212) 421-5799

 

 26 

 

 

with a copy to: Proskauer Rose LLP   Eleven Times Square   New York, NY
10036-8299   Attention:   Steven L. Lichtenfeld                       Michael E.
Ellis   Email:          slichtenfeld@proskauer.com  
                    mellis@proskauer.com   Facsimile:  (212) 969-2900

 

if to Brookfield: c/o Brookfield Property Group   250 Vesey Street, 15th Floor  
New York, NY 10281   Attention:  Lowell Baron                      Andrew Burych
  Email: lowell.baron@brookfield.com               andrew.burych@brookfield.com

 

with a copy to: Cleary Gottlieb Steen & Hamilton LLP   One Liberty Plaza   New
York, NY 10006   Attention: Steven L. Wilner                    Neil Q.
Whoriskey   Email:       swilner@cgsh.com  
                  nwhoriskey@cgsh.com   Facsimile:  (212) 225-3999   if to the
Advisor: American Realty Capital Hospitality Advisors, LLC   405 Park Avenue,
14th Floor   New York, NY 10022   Attention:  Jesse Charles Galloway  
Email:        jgalloway@ar-global.com   Facsimile:  (646) 861-7804

 

 27 

 

 

with a copy to: Paul, Weiss, Rifkind, Wharton & Garrison LLP   1285 Avenue of
the Americas   New York, New York 10019   Attention: Jeffrey D. Marell  
Email:       jmarell@paulweiss.com   Facsimile:  (212) 492-0105     if to the
Property Manager: American Realty Capital Hospitality Properties, LLC   405 Park
Avenue, 14th Floor   New York, NY 10022   Attention:  Jesse Charles Galloway  
Email:        jgalloway@ar-global.com   Facsimile:  (646) 861-7804     with a
copy to: Paul, Weiss, Rifkind, Wharton & Garrison LLP   1285 Avenue of the
Americas   New York, New York 10019   Attention:  Jeffrey D. Marell  
Email:        jmarell@paulweiss.com   Facsimile:  (212) 492-0105       if to any
other Holder who becomes party to this Agreement after the date hereof, to the
address on the counterpart signature page to this Agreement executed by such
Holder, or such other address, email address or facsimile number as any party
may hereafter specify by like notice to the other parties hereto.

 

All such notices, requests and other communications shall be deemed received on
the date of actual receipt by the recipient thereof if received prior to 5:00
p.m. local time in the place of receipt and such day is a Business Day in the
place of receipt. Otherwise, any such notice, request or communication shall be
deemed not to have been received until 9:00 a.m. local time on the next
succeeding Business Day in the place of receipt.

 

Notice to the holder of record of any Registrable Securities shall be deemed to
be notice to the holder of such securities for all purposes hereof.

 

Section 3.03.         Amendment. Any term of this Agreement may be amended and
the observance of any term of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively), only if
such amendment or waiver is in writing and signed by the Company, Brookfield (or
if Brookfield is no longer a party to this Agreement, a majority of Holders of
then-outstanding Registrable Securities issued or issuable upon conversion of
CPUs into OP Units and the redemption thereof for Common Shares), and, if the
Advisor or the Property Manager continues to be a party to this Agreement and
the extent such amendment or waiver adversely effects the rights of the Advisor
or the Property Manager hereunder, the Advisor and the Property Manager, as
applicable. Any amendment or waiver effected in accordance with this paragraph
shall be binding upon all parties to this Agreement.

 

 28 

 

 

Section 3.04.         Successors, Assigns and Transferees. No party hereto may
assign any of its rights or delegate any of its obligations under this Agreement
by operation of Law or otherwise without the prior written consent of the other
parties hereto except any Holder may assign all or a portion of its rights or
obligations hereunder to any Person to which such party transfers its ownership
of all or any of its Registrable Securities (each such Person, a “Permitted
Assignee”); provided, however, that nothing herein shall be deemed to permit any
assignment, transfer or other disposition of Registrable Securities in violation
of the terms of the Transaction Documents, including the Purchase Agreement, the
A&R Opco LPA, or the Company’s Charter in effect as of the date of such
assignment, transfer or other disposition; provided, further however no
Brookfield Excluded Affiliate may be a Permitted Assignee under this Section
3.04 unless, in the case of a Transfer from Brookfield or a Brookfield
Affiliate, prior to the applicable transfer of Registrable Securities, and as a
condition thereof, the applicable Brookfield Excluded Affiliate notifies the
Company in writing of such Transfer, which notice shall include a confirmation
that such Permitted Transferee is an Affiliate of Brookfield and that, following
such transfer, shall no longer be a Brookfield Excluded Affiliate for purposes
of this Agreement or any of the other Transaction Documents, including the
Purchase Agreement and the A&R Opco LPA. Such Permitted Assignees and any other
Person that acquires Registrable Securities in accordance with the terms of the
Transaction Documents, shall execute a counterpart to this Agreement and become
a party hereto with all the rights and obligations set forth hereunder and such
Permitted Assignee’s Registrable Securities shall be subject to the terms of
this Agreement.

 

Section 3.05.         Binding Effect. Except as otherwise provided in this
Agreement, the provisions of this Agreement shall inure to the benefit of and be
binding upon, the successors, permitted assigns, heirs, executors, and
administrators of the parties (whether by merger, consolidation, acquisition of
all or substantially all of the assets of the respective party or otherwise).

 

Section 3.06.         Third Parties. Other than each other Person entitled to
indemnity or contribution under Section 2.10, nothing in this Agreement,
expressed or implied, is intended to confer on any Person other than the parties
hereto any rights, remedies, obligations or Liabilities under or by reason of
this Agreement, and no Person that is not a party to this Agreement (including
any partner, member, stockholder, director, officer, employee or other
beneficial owner of any party, in its own capacity as such or in bringing a
derivative action on behalf of a party) shall have any standing as third-party
beneficiary with respect to this Agreement or the transactions contemplated by
this Agreement.

 

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Section 3.07.         Governing Law; Injunctive Relief. This Agreement shall be
governed in all respects by the Laws of the State of New York without regard to
any choice of Laws or conflict of Laws provisions that would require the
application of the Laws of any other jurisdiction. The parties agree that
irreparable damage, for which monetary damages would not be an adequate remedy,
would occur if any of the provisions of this Agreement (including failing to
take such actions that are required of it hereunder to consummate the
transactions contemplated by this Agreement) were not performed in accordance
with their specific terms or were otherwise breached or threatened to be
breached. It is accordingly agreed that each of the parties shall be entitled
(in addition to any other remedy that may be available to it, including monetary
damages) to an injunction or injunctions, specific performance and other
equitable relief, without proof of actual damages, to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this Agreement
exclusively in any state or federal courts located in the City of New York and
any appellate court therefrom within the State of New York, in addition to any
other remedy to which they are entitled at Law or in equity for any such breach.
Each of the parties agree that it will not oppose the granting of an injunction,
specific performance and other equitable relief on the basis that any other
party has an adequate remedy at Law or that any award of specific performance is
not an appropriate remedy for any reason at Law or in equity. The parties hereto
agree that (i) by seeking the remedies provided for in this Section 3.07 a party
shall not in any respect waive its right to seek at any time any other form of
relief that may be available to a party under this Agreement and (ii) the
commencement of any action or proceeding pursuant to this Section 3.07 or
anything set forth in this Section 3.07 shall not restrict or limit any party’s
right to pursue any other remedies under this Agreement that may be available
then or thereafter. 

 

Section 3.08.         Jurisdiction; Waiver of Jury Trial. In addition, each of
the parties irrevocably agrees that any legal action or proceeding with respect
to this Agreement and the rights and obligations arising hereunder, or for
recognition and enforcement of any judgment in respect of this Agreement and the
rights and obligations arising hereunder brought by any party or its successors
or assigns, shall be brought and determined exclusively in any state or federal
courts located in the City of New York and any appellate court therefrom within
the State of New York. The parties further agree that no party to this Agreement
shall be required to obtain, furnish or post any bond or similar instrument in
connection with or as a condition to obtaining any remedy referred to in this
Section 3.08 and each party waives any objection to the imposition of such
relief or any right it may have to require the obtaining, furnishing or posting
of any such bond or similar instrument. Each of the parties hereby irrevocably
submits with regard to any such action or proceeding for itself and in respect
of its property, generally and unconditionally, to the personal jurisdiction of
the aforesaid courts and agrees that it will not bring any action or proceeding
relating to this Agreement or any of the transactions contemplated by this
Agreement in any court other than the aforesaid courts. Each of the parties
hereby irrevocably waives, and agrees not to assert, by way of motion, as a
defense, counterclaim or otherwise, in any action or proceeding with respect to
this Agreement, (a) any claim that it is not personally subject to the
jurisdiction of the above named courts for any reason other than the failure to
serve in accordance with this Section 3.08, (b) any claim that it or its
property is exempt or immune from jurisdiction of any such court or from any
legal process commenced in such courts (whether through service of notice,
attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise) and (c) to the fullest extent permitted by
the applicable Law, any claim that (i) the action or proceeding in such court is
brought in an inconvenient forum, (ii) the venue of such action or proceeding is
improper or (iii) this Agreement, or the subject matter hereof may not be
enforced in or by such courts. Each party hereby consents to service being made
through the notice procedures set forth in Section 3.02 and agrees that service
of any process, summons, notice or document by registered mail (return receipt
requested and first-class postage prepaid) to the respective addresses set forth
in Section 3.02 shall be effective service of process for any suit or proceeding
in connection with this Agreement or the transactions contemplated by this
Agreement. EACH OF THE PARTIES KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WITH AND
UPON THE ADVICE OF COMPETENT COUNSEL IRREVOCABLY WAIVES ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION OR PROCEEDING (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE), DIRECTLY OR INDIRECTLY, ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY. 

 

 30 

 

 

Section 3.09.         Entire Agreement. This Agreement and the other documents
delivered pursuant to or in connection with this Agreement, including the other
Transaction Documents, constitute the full and entire understanding and
agreement among the parties with regard to the subjects hereof and thereof, and
supersede all prior agreements and understandings, both written and oral, among
the parties, or any of them, with respect to the subject matter hereof and
thereof. Except as otherwise expressly provided herein (including Section 3.04),
no Holder or other party hereto may assign any of its respective rights or
delegate any of its respective obligations under this Agreement without the
prior written consent of the other parties hereto, and any attempted assignment
or delegation in violation of the foregoing shall be null and void. 

Section 3.10.         Severability. If any term or provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable, or void, portions of such provision, or such provision in its
entirety, to the extent necessary, shall be severed from this Agreement and the
balance of this Agreement shall be enforceable in accordance with its terms.
Upon such a declaration by a court of competent jurisdiction, the parties shall
use their respective reasonable best efforts to negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner in order that the transactions
contemplated by this Agreement to be consummated as originally contemplated to
the fullest extent possible. 

 

Section 3.11.         Counterparts. This Agreement may be executed in any number
of counterparts and signatures may be delivered by facsimile or in electronic
format, each of which may be executed by less than all the parties, each of
which shall be enforceable against the parties actually executing such
counterparts and all of which together shall constitute one instrument.

 

Section 3.12.         No Recourse. Notwithstanding anything that may be
expressed or implied in this Agreement, the Company and each Holder covenant,
agree and acknowledge that no recourse under this Agreement or any documents or
instruments delivered in connection with this Agreement shall be had against any
former, current or future director, officer, employee, incorporator,
stockholder, equity holder, controlling Person, portfolio company, manager,
advisor, managing member, member, general partner, limited partner, principal or
other agent of any Holder or of any Affiliate or assignee thereof (excluding,
for the avoidance of doubt, the Company and Opco, the “Non-Recourse Parties”),
as such, whether by the enforcement of any assessment or by any legal or
equitable proceeding, or by virtue of any statute, regulation or other
applicable law, it being expressly agreed and acknowledged that no Liability
whatsoever shall attach to, be imposed on or otherwise be incurred by any
Non-Recourse Party, as such, for any obligation of any Holder under this
Agreement or any documents or instruments delivered in connection with this
Agreement or the transactions contemplated herein or for any claim based on, in
respect of or by reason of the respective obligations of such Holder under this
Agreement. Without limiting the rights of any party against any other party
hereto, in no event shall any party or any party’s Affiliates seek to enforce
this Agreement against, make any claims for breach of this Agreement against, or
seek to recover monetary damages from, any Non-Recourse Party. Each party hereby
waives and releases all such Liability. This waiver and release is a material
inducement to each party’s entry into this Agreement.

 

 31 

 

 

Section 3.13.         Headings. The heading references herein and in the table
of contents hereto are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

 

[SIGNATURE PAGES TO FOLLOW]

 

 32 

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.

 

  COMPANY       HOSPITALITY INVESTORS TRUST, INC.         By:     Name:    
Title:           BROOKFIELD       Brookfield Strategic Real Estate Partners
II Hospitality REIT II, LLC         By:     Name:     Title:           ADVISOR  
    AMERICAN REALTY CAPITAL
HOSPITALITY ADVISORS, LLC       By: American Realty Capital Hospitality
Special Limited Partner, LLC, its sole member       By: American Realty Capital
IX, LLC, its sole
member       By: AR Capital, LLC, its sole member         By:     Name: Edward
M. Weil, Jr.   Title: Chief Executive Officer

 

[Signature Page to Registration Rights Agreement]

 

 

 

 

  PROPERTY MANAGER       AMERICAN REALTY CAPITAL
HOSPITALITY PROPERTIES, LLC       By: American Realty Capital Hospitality
Special Limited Partner, LLC, its sole
member       By: American Realty Capital IX, LLC, its sole member       By: AR
Capital, LLC, its sole member         By:     Name: Edward M. Weil, Jr.   Title:
Chief Executive Officer

 

[Signature Page to Registration Rights Agreement]

 

 

 

 

Exhibit H

 

RESERVED

 

 

 

 

EXHIBIT H

 

[RESERVED]

 

 

 

  

Exhibit I

 

Mutual Waiver and Release

 

[see attached]

 

 

 

 

EXHIBIT I

 

MUTUAL WAIVER AND RELEASE

 

This MUTUAL WAIVER AND RELEASE (this “Agreement”), dated as of [•], 2017, is by
and among (i) American Realty Capital Hospitality Advisors, LLC (the “Advisor”),
(ii) American Realty Capital Hospitality Properties, LLC (the “Hospitality
Manager”), (iii) American Realty Capital Hospitality Grace Portfolio, LLC (the
“Grace Manager” and together with the Hospitality Manager, the “Property
Manager”), (iv) Crestline Hotels & Resorts, LLC (“Crestline”), (v) Hospitality
Investors Trust, Inc. (formerly known as American Realty Capital Hospitality
Trust, Inc.) (“ARCH”), (vi) Hospitality Investors Trust Operating Partnership,
L.P. (formerly known as American Realty Capital Hospitality Operating
Partnership, L.P.) (the “OP”), (vii) American Realty Capital Hospitality Special
Limited Partnership, LLC (the “Special Limited Partner” and together with the
Advisor, the Hospitality Manager, the Grace Manager and Crestline, the “Advisor
Parties”), and (viii) Brookfield Strategic Real Estate Partners II Hospitality
REIT II, LLC, a Delaware limited liability company and an entity that is
controlled, directly or indirectly, by Brookfield Asset Management, Inc. (the
“Investor” and together with ARCH and the OP, the “REIT Parties”).

 

WITNESSETH:

 

WHEREAS, the Advisor Parties and the REIT Parties have entered into that certain
Framework Agreement, dated as of January 12, 2017 (the “Framework Agreement”);
and

 

WHEREAS, in connection with the Closing, the Advisor Parties and the REIT
Parties have agreed to execute and delivery to the other this Agreement.

 

NOW, THEREFORE, in consideration of the premises and covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as follows:

 

1.           Waiver and Release by REIT Parties.

 

(a) Effective as of the date hereof, except as otherwise provided in Section
1(b) (which matters are expressly not waived or released under this Agreement):

 

(i)        each of the REIT Parties (other than the Investor), on its own behalf
and on behalf of its Affiliates and Representatives, in each case in each of
their capacities as such, and the respective predecessors, successors and
assigns of the foregoing (in their respective capacities as such) (collectively
with the REIT Parties (other than the Investor), the “REIT Releasors”), does
hereby irrevocably, unconditionally, completely, fully and forever waive,
release, acquit and discharge each of the Advisor Parties, each of their
respective members, partners, equityholders, Affiliates and Representatives, in
each case in each of their capacities as such, and the respective predecessors,
successors and assigns of the foregoing (in their respective capacities as such)
(collectively with the Advisor Parties, the “Advisor Releasors”), jointly and
individually, of and from any and all Proceedings and Losses that the REIT
Releasors, ever had, now has, or which he, she or it or his, her or its
successors and assigns shall or may have, whether known or unknown, liquidated
or unliquidated, fixed or contingent, matured or unmatured, asserted or
unasserted, arising out of or related to acts or omissions of the Advisor
Releasors, in each case, prior to the date hereof (including, without
limitation, arising out of or relating to the Advisory Agreement, the OP
Agreement and the Property Management Agreements) (such matters, the “Released
Matters” and each such Proceeding and Loss as to such REIT Releasors, but
expressly excluding the matters set forth in Section 1(b), a “REIT Released
Claim”); and

 

 

 

 

(ii)        the Investor, on its own behalf and on behalf of its Affiliates and
Representatives, in each case in each of their capacities as such, and the
respective predecessors, successors and assigns of the foregoing (in their
respective capacities as such) (collectively with the Investor, the “Investor
Releasors”), does hereby irrevocably, unconditionally, completely, fully and
forever waive, release, acquit and discharge each of the Advisor Releasors
jointly and individually, of and from any and all Proceedings and Losses that
the Investor Releasors ever had, now has, or which he, she or it or his, her or
its successors and assigns shall or may have, whether known or unknown,
liquidated or unliquidated, fixed or contingent, matured or unmatured, asserted
or unasserted, arising out of or related to acts or omissions of the Advisor
Releasors solely in respect of ARCH, the OP or their respective subsidiaries in
each case, prior to the date hereof (such matters, the “Investor Released
Matters” and each such Proceeding and Loss as to such Investor Releasors, but
expressly excluding the matters set forth in Section 1(b), an “Investor Released
Claim”).

 

(b) Notwithstanding anything in Section 1(a) to the contrary, with respect to a
REIT Releasor and/or an Investor Releasor, the REIT Released Claims and the
Investor Released Claims do not include any Proceedings or Losses arising (i)
under the Framework Agreement or any document or instrument delivered pursuant
to or in connection with the transactions contemplated by Framework Agreement
(including, without limitation, this Agreement, but expressly excluding the SPA
(as defined in the Framework Agreement)), and (ii) with respect any
Representatives of a REIT Party that are also employed by any Advisor Releasor
(A) to salaries, bonuses and expenses that have accrued or that may be payable
to such Representative (including any employment agreement to which such
Representative is a party), or (B) any other rights that have accrued, that may
accrue or that may be payable to such Representative in accordance with the
terms of any employment agreement to which such Representative is a party, in
each case, entered into prior to or on the date hereof.

 

(c) Each REIT Party (other than Investor), on behalf of itself and each of its
REIT Releasors, (i) represents and warrants that no such REIT Releasor has
pledged, assigned or otherwise transferred to any person all or any portion of
any REIT Released Claims (or any Proceedings or Losses that, but for any such
pledge, assignment or transfer, would constitute REIT Released Claims) or any
rights or entitlements with respect thereto; (ii) covenants and agrees, to the
extent not prohibited by applicable law, that no such REIT Releasor shall,
either individually or in concert with another person or group of persons,
maintain or cause to be maintained any action, in any capacity whatsoever,
against any of the Advisor Releasors based upon any of the REIT Released Claims;
and (iii) shall indemnify and hold harmless each of the Advisor Releasors from
and against any and all losses incurred by any of the Advisor Releasors, by
reason of any breach of any of the representations, warranties, covenants or
agreements in clause (i) or (ii) of this Section 1(c).

 

 2 

 

 

(d) Investor, on behalf of itself and each of its Investor Releasors, (i)
represents and warrants that no such Investor Releasor has pledged, assigned or
otherwise transferred to any person all or any portion of any Investor Released
Claims (or any Proceedings or Losses that, but for any such pledge, assignment
or transfer, would constitute Investor Released Claims) or any rights or
entitlements with respect thereto; (ii) covenants and agrees, to the extent not
prohibited by applicable law, that no such Investor Releasor shall, either
individually or in concert with another person or group of persons, maintain or
cause to be maintained any action, in any capacity whatsoever, against any of
the Advisor Releasors based upon any of the Investor Released Claims; and (iii)
shall indemnify and hold harmless each of the Advisor Releasors from and against
any and all losses incurred by any of the Advisor Releasors, by reason of any
breach of any of the representations, warranties, covenants or agreements in
clause (i) or (ii) of this Section 1(d).

 

2.           Waiver and Release by Advisor Parties.

 

(a) Effective as of the date hereof, except as otherwise provided in Section
2(b) (which matters are expressly not waived or released under this Agreement),
each of the Advisor Parties, on behalf of itself and each of its Advisor
Releasors, does hereby irrevocably, unconditionally, completely, fully and
forever waive, release, acquit and discharge each of the REIT Releasors and each
of the Investor Releasors, jointly and individually, of and from any and all
Proceedings and Losses that the Advisor Releasors ever had, now has, or which
he, she or it or his, her or its successors and assigns shall or may have,
whether known or unknown, liquidated or unliquidated, fixed or contingent,
matured or unmatured, asserted or unasserted, arising out of or related to acts
or omissions of REIT Releasors and/or the Investor Releasors, in each case,
prior to the date hereof (including, without limitation, arising out of or
relating to the Advisory Agreement, the OP Agreement and the Property Management
Agreements) (such matters, the “Advisor Released Matters” and each such
Proceeding and Loss as to such Advisor Releasors, but expressly excluding the
matters set forth in Section 2(b), an “Advisor Released Claim”)

 

(b) Notwithstanding anything in Section 2(a) to the contrary, with respect to an
Advisor Releasor, the Advisor Released Claims do not include any Proceedings or
Losses arising under the Framework Agreement or any document or instrument
delivered pursuant to or in connection with the transactions contemplated by the
Framework Agreement (including, without limitation, this Agreement, but
expressly excluding the SPA (as defined in the Framework Agreement)).

 

(c) Each Advisor Party, on behalf of itself and each of its Advisor Releasors,
(i) represents and warrants that no such Advisor Releasor has pledged, assigned
or otherwise transferred to any person all or any portion of any Advisor
Released Claims (or any Proceedings or Losses that, but for any such pledge,
assignment or transfer, would constitute Advisor Released Claims) or any rights
or entitlements with respect thereto; (ii) covenants and agrees, to the extent
not prohibited by applicable law, that no such Advisor Releasor shall, either
individually or in concert with another person or group of persons, maintain or
cause to be maintained any action, in any capacity whatsoever, against any of
the REIT Releasors or any of the Investor Releasors based upon any of the
Advisor Released Claims; and (iii) shall indemnify and hold harmless each of the
REIT Releasors and each of the Investor Releasors from and against any and all
losses incurred by any of the REIT Releasors or Investor Releasors, by reason of
any breach of any of the representations, warranties, covenants or agreements in
clause (i) or (ii) of this Section 2(c).

 

 3 

 

 

3.            Definitions.

 

(a) Capitalized terms used herein but not defined shall have the meanings
ascribed thereto in the Framework Agreement.

 

(a) “Action” means any action, claim, lawsuit, legal proceeding, whistleblower
complaint, litigation, arbitration and mediation, and any hearing, investigation
(internal or otherwise), probe or inquiry by any Governmental Authority.

 

(b) “Affiliate” shall mean, with respect to any person, any other person
directly or indirectly controlling, controlled by, or under common control with
such person. For purposes of this definition, “control” (including, with
correlative meanings, the terms “controlled by” and “under common control
with”), as applied to any person, means the possession, directly or indirectly,
of the power to vote a majority of the securities having voting power for the
election of directors or managers (or other persons acting in similar
capacities) of such person or otherwise to direct or cause the direction of the
management and policies of such person through the ownership of voting
securities, by contract or otherwise; provided, however, that for purposes of
this Agreement (i) no REIT Party shall be deemed to be an “Affiliate” of any
Advisor Party, (ii) no Advisor Party shall be deemed to be an “Affiliate” of any
REIT Party, and (iii) the Investor shall not be deemed to be an “Affiliate” of
any REIT Party.

 

(c) “Liabilities” means any debt, obligation or liability of any nature
(including any unmatured, unaccrued, unasserted, contingent, conditional, joint
or several liability), regardless of whether such debt, obligation or liability
would be required to be disclosed on a balance sheet prepared in accordance with
generally accepted accounting principles and regardless of whether such debt,
obligation or liability is immediately due and payable.

 

(d) “Losses” means all damages, Proceedings, Liabilities, fines, fees,
penalties, costs and expenses (including the third party costs of investigation,
preparation and defense, amounts paid in settlement and reasonable attorneys’
fees and disbursements).

 

(e) “Governmental Authority” means any federal, national, supranational, state,
county, provincial, local or other governmental, regulatory or administrative
authority, agency or commission, or court or other judicial or arbitral body.

 

(f) “Person” means an individual or entity, including a partnership, limited
liability company, corporation, association, joint stock company, trust, joint
venture, unincorporated organization or Governmental Authority.

 

(g) “Proceedings” means governmental, judicial, administrative or adversarial
proceedings (public or private), Actions or other disputes, including any
adversarial proceedings arising out of this Agreement.

 

 4 

 

 

(h) “Representatives” of a Person means any directors, officers, employees,
agents and other authorized representatives of such Person.

 

4.           Entire Agreement. This Agreement (together with the Framework
Agreement and the other documents contemplated thereby) constitutes the entire
agreement and understanding among the Parties in respect of the subject matter
hereof and thereof and supersedes all prior and contemporaneous arrangements,
agreements and understandings, both oral and written, whether in term sheets,
presentations or otherwise among the Parties, or between any of them, with
respect to the subject matter hereof and thereof.

 

5.           Miscellaneous. Sections 11 (Counterparts), 12 (Governing Law;
Specific Performance; WAIVER OF JURY TRIAL), 13 (Severability), 14 (Further
Assurances), 15 (Parties in Interest), 17 (Headings), 18 (Expenses), 19
(Construction), 20 (Assignment) and Section 22 (Amendments and Waivers) of the
Framework Agreement are incorporated herein by reference, mutatis mutandis.

 

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 5 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first written above.

 

  AMERICAN REALTY CAPITAL HOSPITALITY ADVISORS, LLC       By: American Realty
Capital Hospitality Special Limited Partnership, LLC, its sole member       By:
American Realty Capital IX, LLC, its sole member       By: AR Capital, LLC, its
sole member         By:     Name: Edward M. Weil, Jr.   Title: Chief Executive
Officer         AMERICAN REALTY CAPITAL HOSPITALITY PROPERTIES, LLC       By:
American Realty Capital Hospitality Special Limited Partnership, LLC, its
managing member       By: American Realty Capital IX, LLC, its sole member      
By: AR Capital, LLC, its sole member         By:     Name: Edward M. Weil, Jr.  
Title: Chief Executive Officer

 

Signature page to Mutual Waiver and Release

 

 

 

 

  AMERICAN REALTY CAPITAL HOSPITALITY GRACE PORTFOLIO, LLC       By: American
Realty Capital Hospitality Properties, LLC, its sole member       By: American
Realty Capital Hospitality Special Limited Partnership, LLC, its managing member
      By: American Realty Capital IX, LLC, its sole member       By: AR Capital,
LLC, its sole member         By:     Name: Edward M. Weil, Jr.   Title: Chief
Executive Officer         AMERICAN REALTY CAPITAL HOSPITALITY SPECIAL LIMITED
PARTNERSHIP, LLC       By: American Realty Capital IX, LLC, its sole member    
  By: AR Capital, LLC, its sole member         By:     Name: Edward M. Weil, Jr.
  Title: Chief Executive Officer         CRESTLINE HOTELS & RESORTS, LLC        
By:     Name:     Title:  

 

Signature page to Mutual Waiver and Release

 

 

 

 

  HOSPITALITY INVESTORS TRUST, INC.         By:     Name:     Title:          
HOSPITALITY INVESTORS TRUST OPERATING PARTNERSHIP, L.P.       By: Hospitality
Investors Trust, Inc., its general partner         By:     Name:     Title:  

 

Signature page to Mutual Waiver and Release

 

 

 

 

  BROOKFIELD STRATEGIC REAL ESTATE PARTNERS II HOSPITALITY REIT II, LLC        
By:     Name:     Title:  

 

Signature page to Mutual Waiver and Release

 

 

 

  

SCHEDULE I

 

Transition Personnel

 

 

 

 

SCHEDULE II

 

ARCH Consents and Approvals

 

 

 

 

SCHEDULE III

 

Advisor Party Consents and Approvals

 

 

 

 

SCHEDULE IV

 

Certain Transition Matters

 

 

 

 

SCHEDULE V

 

Employee Covenants