EXHIBIT 10.54.1

 

After recording, return to:

 

Bilzin Sumberg Baena

Price & Axelrod LLP

1450 Brickell Avenue, 23rd Floor

Miami, Florida 33131-3456

Attn:  Post-Closing Department

 

(Space Above For Recorder's Use Only)

 

ASSUMPTION AGREEMENT

(JPMCC 2016-JP4)

THIS ASSUMPTION AGREEMENT ("Agreement") is entered into and effective as of
December 30, 2019 (the "Effective Date"), between WILMINGTON TRUST, NATIONAL
ASSOCIATION, AS TRUSTEE FOR THE BENEFIT OF THE REGISTERED HOLDERS OF JPMCC
COMMERCIAL MORTGAGE SECURITIES TRUST 2016-JP4, COMMERCIAL MORTGAGE PASS-THROUGH
CERTIFICATES, SERIES 2016-JP4 ("Lender"), having an address at 1100 North Market
Street, Wilmington, Delaware 19890, Re: JPMCC 2016-JP4; TREEMONT CAPITAL
PARTNERS III, LP, a Texas limited partnership ("Original Borrower"), having an
address at 1415 South Voss #110-94, Houston, Texas  77057, and LF3 LUBBOCK CASA,
LLC, a Delaware limited liability company  ("Fee Borrower") and LF3 LUBBOCK CASA
TRS, LLC, a Delaware limited liability company ("Operating Lessee" together with
Fee Borrower, collectively, "New Borrower"), having an address at 1635 43rd
Street South, Suite 205, Fargo, North Dakota  58103.  Original Borrower and New
Borrower are sometimes collectively referred to as "Borrower Parties".

PRELIMINARY STATEMENT

Original Borrower is the current owner of fee title to the Property, commonly
known as "Home2 Suites By Hilton Lubbock" located in the City of Lubbock, County
of Lubbock, State of Texas, more particularly described in the attached Exhibit
A.

Lender is the current owner and holder of a loan ("Loan") in the original
principal amount of $8,600,000.00, made by Starwood Mortgage Capital LLC, a
Delaware limited liability company ("Original Lender") to Original Borrower
pursuant to the terms of a Loan Agreement dated October 4, 2016 (“Loan
Origination Date”) between Original Borrower and Original Lender (the "Loan
Agreement"), as evidenced and/or secured by the documents described in the Loan
Agreement and on the attached Exhibit B (together with any and all other
agreements, documents, and instruments evidencing, securing or in any manner
relating to the Loan, as all of the same may be amended, restated, supplemented
or otherwise modified from time to time, shall collectively be referred to as
the "Loan Documents").  The Loan is secured in part by the Property, which
Property is described in and encumbered by the "Security Instrument" described
on Exhibit B.  Capitalized terms not otherwise defined in this Agreement shall
have the meanings ascribed to them in the Loan Agreement.

Original Borrower desires to obtain Lender’s consent to the Requested Actions
described below.

The Requested Actions, without Lender’s consent are prohibited by the terms of
the Loan Documents.

Lender has consented to the following requested actions (collectively the
"Requested Actions"): a)Original Borrower selling the Property to Fee Borrower,
b)New Borrower assuming all of Original Borrower's obligations under the Loan
Documents, and c)Fee Borrower, as landlord, and Operating Lessee, as tenant,
entering into that certain Lease Agreement dated as of the Effective Date
("Operating Lease"), d)Operating Lessee and Hilton Franchise Holding LLC
("Franchisor") entering into that certain Franchise Agreement dated as of the
Effective Date ("New Franchise Agreement"), and e)Operating Lessee and NHS LLC,
a North Dakota limited liability company, d/b/a National Hospitality Services
("Property Manager") entering into that certain Management Agreement dated as of
the Effective Date, all on the terms set forth below.

In consideration of $10.00 paid by each of the parties to the other, the mutual
covenants set forth below, and other good and valuable consideration, receipt
and sufficiency of which are acknowledged, the parties agree as follows:

ARTICLE 1

ACKNOWLEDGMENTS, WARRANTIES AND REPRESENTATIONS

1.1.      Original Borrower Representations.  As a material inducement to Lender
to enter into this Agreement and to consent to the Requested Actions, Original
Borrower acknowledges, warrants, represents and agrees to and with Lender as
follows:

(a)        Incorporation of Recitals.  All of the facts set forth in the
Preliminary Statement of this Agreement are true and correct and incorporated
into this Agreement by this reference.

(b)        Authority of Original Borrower.

(i)            Original Borrower.  Original Borrower is a duly organized,
validly existing limited partnership in good standing under the laws of the
State of Texas.  Treemont Capital Partners III GP, LLC ("Original Borrower GP")
is the general partner of Original Borrower.  Original Borrower GP, acting alone
without the joinder of any other partner of Original Borrower or any other
party, has the power and authority to execute this Agreement on behalf of and to
duly bind Original Borrower under this Agreement.  The execution and delivery
of, and performance under, this Agreement by Original Borrower have been duly
and properly authorized pursuant to all requisite partnership action of Original
Borrower and will not (x) violate any provision of any law, rule, regulation,
order, writ, judgment, injunction, decree, determination or award presently in
effect having applicability to Original Borrower or the certificate of limited
partnership or limited partnership agreement or any other organizational
document of Original Borrower or (y) result in a breach of or constitute or
cause a default under any indenture, agreement, lease or instrument to which
Original Borrower is a party or by which the Property may be bound or affected.

(ii)           Original Borrower GP.  Original Borrower GP is a duly organized,
validly existing limited liability company in good standing under the laws of
the State of Texas.

Treemont Investments, Inc. ("Original Borrower GP's Member") is the sole member
of Original Borrower GP.  Original Borrower GP's Member, acting alone without
the joinder of any other manager or member of Original Borrower GP or any other
party, has the power and authority to execute this Agreement on behalf of and to
duly bind Original Borrower GP and Original Borrower under this Agreement.  The
execution and delivery of, and performance under, this Agreement by Original
Borrower GP have been duly and properly authorized pursuant to all requisite
limited liability company action of Original Borrower GP and will not (x)
violate any provision of any law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award presently in effect having
applicability to Original Borrower GP or the articles of organization,
certificate of formation, operating agreement, limited liability company
agreement or any other organizational document of Original Borrower GP or (y)
result in a breach of or constitute or cause a default under any indenture,
agreement, lease or instrument to which Original Borrower GP is a party or by
which the Property may be bound or affected.

(iii)          Original Borrower GP's Member.  Original Borrower GP's Member is
a duly organized, validly existing corporation in good standing under the laws
of the State of Texas.  Philip A. McRae ("Original Borrower Authorized
Signatory") is the President of Original Borrower GP's Member. Original Borrower
Authorized Signatory, acting alone without the joinder of any other officer,
director or shareholder of Original Borrower GP's Manager or any other party,
has the power and authority to execute this Agreement on behalf of and to duly
bind Original Borrower GP's Member, Original Borrower GP and Original Borrower
under this Agreement.  The execution and delivery of, and performance under,
this Agreement by Original Borrower GP's Member have been duly and properly
authorized pursuant to all requisite corporate action of Original Borrower GP's
Member and will not (x) violate any provision of any law, rule, regulation,
order, writ, judgment, injunction, decree, determination or award presently in
effect having applicability to Original Borrower GP's Member or the articles of
incorporation or bylaws or any other organizational document of Original
Borrower GP's Member or (y) result in a breach of or constitute or cause a
default under any indenture, agreement, lease or instrument to which Original
Borrower GP's Member is a party or by which the Property may be bound or
affected.

(c)        Compliance with Laws.  To Original Borrower's knowledge, all permits,
licenses, franchises or other evidences of authority to use and operate the
Property as it is presently being operated and as contemplated by the Loan
Documents are current, valid and in full force and effect.  Original Borrower
has not received any written notice from any governmental entity claiming that
Original Borrower or the Property is not presently in compliance with any laws,
ordinances, rules and regulations bearing upon the use and operation of the
Property, including, without limitation, any notice relating to any violations
of zoning, building, environmental, fire, health, or other laws, ordinances,
rules, codes or regulations.

(d)        Rent Roll.  The Rent Roll ("Rent Roll") attached as Exhibit C is a
true, complete and accurate summary of all tenant leases ("Leases") affecting
the Property as of the Effective Date.

(e)        Leases.  Other than unwritten agreements with transient hotel guests,
there are no Leases affecting the Property as of the Effective Date.

(f)        Title to Property and Legal Proceedings.  Original Borrower is the
current owner of fee title in the Property.  There are no pending or, to the
best of Original Borrower's knowledge, threatened suits, judgments, arbitration
proceedings, administrative claims, executions or other legal or equitable
actions or proceedings against Original Borrower or the Property, or any pending
or, to the best of Original Borrower's knowledge, threatened condemnation

proceedings or annexation proceedings affecting the Property, or any agreements
to convey any portion of the Property, or any rights thereto to any person,
entity, or government body or agency not disclosed in this Agreement, which
could reasonably be expected to materially and adversely affect the Property.

(g)        Loan Documents.  The Loan Documents constitute valid and legally
binding obligations of Original Borrower enforceable against Original Borrower
and the Property in accordance with their terms. Original Borrower acknowledges
and agrees that, nothing in this Agreement, or Lender's consent to the Requested
Actions, shall release or relieve Original Borrower from its obligations and
liabilities under the Loan Documents arising prior to the Effective
Date.  Original Borrower has no defenses, setoffs, claims, counterclaims or
causes of action of any kind or nature whatsoever against Lender, Wells Fargo
Bank, N.A. ("Master Servicer"), LNR Partners, LLC ("LNR") and any and all other
parties appointed and/or serving as servicers of the Loan together with Master
Servicer and LNR (collectively, "Servicer"), all subsidiaries, parents and
affiliates of Lender and Servicer and each of the foregoing parties'
predecessors in interest, and each and all of their respective past, present and
future partners, members, certificateholders, officers, directors, employees,
agents, contractors, representatives, participants and heirs and each and all of
the successors and assigns of each of the foregoing (collectively, "Lender
Parties") or with respect to (i) the Loan, (ii) the Loan Documents, or (iii) the
Property.  To the extent Original Borrower would be deemed to have any such
defenses, setoffs, claims, counterclaims or causes of action as of the Effective
Date, Original Borrower knowingly waives and relinquishes them.

(h)        Bankruptcy.  Original Borrower has no intent to (i) file any
voluntary petition under any Chapter of the Bankruptcy Code, Title 11, U.S.C.A.
("Bankruptcy Code"), or in any manner to seek any proceeding for relief,
protection, reorganization, liquidation, dissolution or similar relief for
debtors ("Debtor Proceeding") under any local, state, federal or other
insolvency law or laws providing relief for debtors, (ii) directly or indirectly
cause any involuntary petition under any Chapter of the Bankruptcy Code to be
filed against Original Borrower or any partners thereof or (iii) directly or
indirectly cause the Property or any portion or any interest of Original
Borrower in the Property to become the property of any bankrupt estate or the
subject of any Debtor Proceeding.

(i)         No Default or Sweep Event Period.  To Original Borrower's knowledge,
no event, fact or circumstance has occurred or failed to occur which
constitutes, or with the lapse or passage of time, giving of notice or both,
could constitute a default, an Event of Default or the commencement of a Sweep
Event Period under the Loan Documents.

(j)         Original Franchise Agreement.  The Franchise Agreement,
dated  September 5, 2013 ("Original Franchise Agreement"), between Original
Borrower and HLT ESP Franchise LLC, a Delaware limited liability company
("Original Franchisor"), pursuant to which Original Borrower has the right to
operate the hotel located on the Property under a name and/or hotel system
controlled by such Original Franchisor, is in full force and effect and there is
no default, breach, or violation existing thereunder by any party thereto and no
event has occurred (other than payments due but not yet delinquent) that, with
the passage of time or the giving of notice, or both, would constitute a
default, breach or violation by any party thereunder. As of the Effective Date,
the Original Franchise Agreement will have been terminated and all sums due
thereunder paid in full.

(k)        Reaffirmation.  Original Borrower reaffirms and confirms the truth
and accuracy of all representations and warranties set forth in the Loan
Documents, in all material respects, as if made on the Effective Date.

1.2.      Acknowledgments, Warranties and Representations of New Borrower. As a
material inducement to Lender to enter into this Agreement and to consent to the
Requested Actions, New Borrower acknowledges, warrants, represents and agrees to
and with Lender as follows:

(a)        Incorporation of Recitals.  All of the facts set forth in the
Preliminary Statement of this Agreement are true and incorporated into this
Agreement.

(b)        Authority of New Borrower.

(i)            Fee Borrower. Fee Borrower is a duly organized, validly existing
limited liability company in good standing under the laws of the State of
Delaware and is qualified to transact business in the State of Texas.  Lodging
Fund REIT III OP, LP ("Fee Borrower Member") is the sole member of Fee
Borrower.  Fee Borrower Member, acting alone without the joinder of any other
manager or member of Fee Borrower or any other party, has the power and
authority to execute this Agreement on behalf of and to duly bind Fee Borrower
under this Agreement and the Loan Documents.  The execution and delivery of, and
performance under, this Agreement and the Loan Documents by Fee Borrower have
been duly and properly authorized pursuant to all requisite limited liability
company action of Fee Borrower and will not (x) violate any provision of any
law, rule, regulation, order, writ, judgment, injunction, decree, determination
or award presently in effect having applicability to Fee Borrower or the
articles of organization, certificate of formation, operating agreement, limited
liability company agreement, or any other organizational document of Fee
Borrower or (y) result in a breach of or constitute or cause a default under any
indenture, agreement, lease or instrument to which Fee Borrower is a party or by
which the Property may be bound or affected.

(ii)            Operating Lessee. Operating Lessee is a duly organized, validly
existing limited liability company in good standing under the laws of the State
of Delaware and is qualified to transact business in the State of
Texas.  Lodging Fund REIT III TRS, Inc. ("Operating Lessee Member") is the sole
member of Operating Lessee.  Operating Lessee Member, acting alone without the
joinder of any other manager or member of Operating Lessee or any other party,
has the power and authority to execute this Agreement on behalf of and to duly
bind Operating Lessee under this Agreement and the Loan Documents.  The
execution and delivery of, and performance under, this Agreement and the Loan
Documents by Operating Lessee have been duly and properly authorized pursuant to
all requisite limited liability company action of Operating Lessee and will not
(x) violate any provision of any law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award presently in effect having
applicability to Operating Lessee or the articles of organization, certificate
of formation, operating agreement, limited liability company agreement, or any
other organizational document of Operating Lessee or (y) result in a breach of
or constitute or cause a default under any indenture, agreement, lease or
instrument to which Operating Lessee is a party or by which the Property may be
bound or affected.

(iii)           Operating Lessee Member.  Operating Lessee Member is a duly
organized, validly existing corporation in good standing under the laws of the
State of Delaware and is qualified to transact business in the State of
Texas.  Fee Borrower Member is the sole shareholder of Operating Lessee
Member.  Fee Borrower Member, acting alone without the joinder of any other
officer, director or shareholder of Operating Lessee Member or any other party,
has

the power and authority to execute this Agreement on behalf of and to duly bind
Operating Lessee Member and Operating Lessee under this Agreement.  The
execution and delivery of, and performance under, this Agreement by Operating
Lessee Member have been duly and properly authorized pursuant to all requisite
corporate action of Operating Lessee Member and will not (x) violate any
provision of any law, rule, regulation, order, writ, judgment, injunction,
decree, determination or award presently in effect having applicability to
Operating Lessee Member or the articles of incorporation or bylaws or any other
organizational document of Operating Lessee Member or (y) result in a breach of
or constitute or cause a default under any indenture, agreement, lease or
instrument to which Operating Lessee Member is a party or by which the Property
may be bound or affected.

(iv)           Fee Borrower Member.  Fee Borrower Member is a duly organized,
validly existing limited partnership in good standing under the laws of the
State of Delaware and is qualified to transact business in the State of
Texas.  Lodging Fund REIT III, Inc. ("REIT") is the sole general partner of Fee
Borrower Member.  REIT, acting alone without the joinder of any other partner of
Fee Borrower Member or any other party, has the power and authority to execute
this Agreement on behalf of and to duly bind Fee Borrower Member, Fee Borrower,
Operating Lessee Member, and Operating Lessee under this Agreement and the Loan
Documents.  The execution and delivery of, and performance under, this Agreement
and the Loan Documents by Fee Borrower Member have been duly and properly
authorized pursuant to all requisite partnership action of Fee Borrower Member
and will not (x) violate any provision of any law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award presently in effect
having applicability to Fee Borrower Member or the certificate of limited
partnership or limited partnership agreement or any other organizational
document of Fee Borrower Member or (y) result in a breach of or constitute or
cause a default under any indenture, agreement, lease or instrument to which Fee
Borrower Member is a party or by which the Property may be bound or affected.

(v)            REIT.  REIT is a duly organized, validly existing corporation in
good standing under the laws of the State of Maryland and is qualified to
transact business in the State of Texas.  Katie Cox ("New Borrower Authorized
Signatory") is the Chief Financial Officer of REIT. New Borrower Authorized
Signatory, acting alone without the joinder of any other officer, director or
shareholder of REIT or any other party, has the power and authority to execute
this Agreement on behalf of and to duly bind REIT, Fee Borrower Member, Fee
Borrower, Operating Lessee Member and Operating Lessee under this
Agreement.  The execution and delivery of, and performance under, this Agreement
by REIT have been duly and properly authorized pursuant to all requisite
corporate action of REIT and will not (x) violate any provision of any law,
rule, regulation, order, writ, judgment, injunction, decree, determination or
award presently in effect having applicability to REIT or the articles of
incorporation or bylaws or any other organizational document of REIT or (y)
result in a breach of or constitute or cause a default under any indenture,
agreement, lease or instrument to which REIT is a party or by which the Property
may be bound or affected.

(c)        Financial Statements.  The financial statements and other information
("Financial Statements") of REIT and Fee Borrower Member (jointly and severally,
and individually and collectively, as the context may require, “New Indemnitor”)
which have been previously delivered to Lender are true, complete and accurate
in all material respects and accurately represent the financial condition of New
Indemnitor as of the date thereof.  All of the assets shown on each New
Indemnitor's Financial Statements are owned by such New Indemnitor,
individually, as its sole and separate property, and not otherwise jointly with
any other person or entity.  There has not been any material adverse change to
the financial condition of New

Indemnitor between the date of the Financial Statements and the Effective
Date.  New Borrower also acknowledges and agrees to cause New Indemnitor to
timely comply with all financial, bookkeeping and reporting requirements set
forth in the Loan Documents, including, without limitation, those set forth in
Section 4.1.7 of the Loan Agreement.  New Borrower acknowledges that the
Financial Statements have been provided to Lender to induce Lender to enter into
this Agreement and are being relied upon by Lender for such purposes.

(d)        Bankruptcy Proceedings.  None of New Borrower, Fee Borrower Member,
Operating Lessee Member, and REIT (together with any other direct or indirect
owners of 10% or more of New Borrower, collectively, the "New Borrower Parties")
or any other entities which may be owned or controlled directly or indirectly by
any of New Borrower Parties (collectively, the "Related Entities") has been a
party to any Debtor Proceeding within ten (10) years prior to the Effective
Date.

(e)        Defaults on Other Indebtedness.  None of New Borrower Parties or any
Related Entities has materially defaulted under its or their obligations with
respect to any other indebtedness.

(f)        New Borrower's Organizational Documents.  New Borrower has not
transacted any business in New Borrower's name since its formation.  New
Borrower is and will continue to be in full compliance with all of its
organizational documents and the single purpose entity and separateness
requirements of the Loan Documents and such organizational documents do not
conflict with any of such single purpose entity and separateness requirements of
the Loan Documents.

(g)        Assets of New Borrower.  The only assets of Fee Borrower are the
Property, the personal property owned by Fee Borrower and used in connection
with the Property and cash or cash equivalents. The only assets of Operating
Lessee are the Operating Lessee's leasehold interest in the Property pursuant to
the Operating Lease, the personal property owned by the Operating Lessee and
used in connection with the Property and cash or cash equivalents.

(h)        Management of Property.  Operating Lessee is entering into a
Management Agreement with Property Manager for the management of the Property
(the "New Management Agreement").  The term "Management Agreement" or
"management agreement" or such other similar term in the Loan Documents shall
subsequently refer to the New Management Agreement.  The term "Manager" or such
other similar term in the Loan Documents shall subsequently refer to the
Property Manager.  New Borrower covenants and agrees to comply with and to cause
the Property Manager to comply with all terms of the Loan Documents concerning
the management of the Property, including without limitation the obligation to
obtain Lender's consent to the management of the Property by any entity other
than Property Manager.  Property Manager shall execute and deliver to Lender a
subordination of the New Management Agreement in form acceptable to Lender.

(i)         Loans to Related Entities.  There are no loans payable by New
Borrower to any of the Related Entities or any other entities or persons.

(j)         New Borrower Parties' Interests.  None of New Borrower Parties or
any of the Related Entities is obtaining a loan to finance its direct or
indirect interest in New Borrower or the Property or pledging its direct or
indirect interest in New Borrower to any party, and none of the entities or
individuals owning a direct or indirect interest in New Borrower has any right
to take over control from any of such other entities or individuals.

(k)        Operating Lease.

(i)         As of the Effective Date, Operating Lessee has leased the Property
from Fee Borrower pursuant to the Operating Lease.  Each New Borrower represents
to Lender that, as of the Effective Date, (a) there are no Leases at the
Property other than the Operating Lease, (b) Fee Borrower is the sole owner of
the entire lessor’s interest in the Operating Lease, (c) the Operating Lease is
valid and enforceable against Fee Borrower and Operating Lessee as set forth
therein and is in full force and effect, (d) no party under the Operating Lease
is in default, (e) none of the rents payable under the Operating Lease have been
assigned or otherwise pledged or hypothecated other than as provided in the
Security Instrument; (f) none of the rents have been collected for more than one
(1) month in advance, (g) there exists no offsets or defenses to the payment of
any portion of the rents and Fee Borrower has no monetary obligation to
Operating Lessee under the Operating Lease, (h) the Operating Lease does not
contain an option to purchase, right of first refusal to purchase or any other
similar provision, and (i) there are no brokerage commissions or finder fee due
and payable regarding the Operating Lease.

(ii)        Each New Borrower covenants and agrees: (a) to comply with all
financial and other material terms and conditions of the Operating Lease, (b)
not to terminate the Operating Lease or modify, change, supplement, alter or
amend any financial or other material term of the Operating Lease without
obtaining the prior written consent of Lender, which consent may be withheld in
the Lender's sole and absolute discretion, (c) not to assign, transfer or pledge
(other than to Lender) any of their respective interests in the Operating Lease
to any third party, (d) not to consent or permit the assignment, pledge or other
transfer of any right, title or interest in the Operating Lease or equity
interests in Operating Lessee to any third party, (e) not to sublease, license
or otherwise grant any of its right to use the Property to any third party in
violation of the Loan Documents; (f) to pay to Lender any termination, consent
or similar type fee paid or payable to Fee Borrower in connection with any
termination of the Operating Lease (which fee shall be held by Lender as
security for the Loan), (g) not to prepay or accept any prepayments of the
rents, additional rents or other sums due under the Operating Lease for more
than one (1) month in advance of the due dates thereof, and (h) use commercially
reasonable efforts to enforce the terms and conditions of the Operating Lease
despite the fact that the beneficial owners of each New Borrower may be related.
Notwithstanding anything contained in this Section to the contrary, the
Operating Lease may be modified or amended without the prior written consent of
Lender to correct scrivener's errors and extend the term of the Operating Lease.

(iii)       Each New Borrower covenants and agrees that the Fixed Rent (as such
term is defined in the Operating Lease) required to be paid by Operating Lessee
to Fee Borrower on a monthly basis under the terms of the Operating Lease, shall
be in excess of the monthly Debt Service and monthly deposits into the Reserve
Funds collected under the Loan Documents.

(l)         Subordination of Operating Lease.  Notwithstanding anything to the
contrary in the Operating Lease, Operating Lessee acknowledges and agrees that
the Operating Lease and any and all rights and interests of Operating Lessee
thereunder and to the Premises (as defined in the Operating Lease) are and shall
be in all respects subject and subordinate to the lien and security interests
created under the Security Instrument and other Loan Documents, and to all
renewals, extensions, increases, supplements, amendments, modifications and
replacements of any of the foregoing and any advances made thereunder.

(m)       Collateral Assignment of Operating Lease.  Contemporaneously with this
Agreement, Operating Lessee has assigned its interest in the Operating Lease and
other collateral

to Lender by the Collateral Assignment of Operating Lease as further security
for the Loan.  Operating Lessee acknowledges and agrees that if an Event of
Default occurs and is continuing under the Loan Documents, Lender may elect, as
one of its remedies under the Loan Documents (but not its exclusive remedy), to
terminate the Operating Lease and Lender shall not be obligated to pay Operating
Lessee any termination fee or any other consideration (i.e. the provision of
another location in which to operate) in connection with Lender’s termination of
the Operating Lease.  To the extent any of the terms and provisions of the
Operating Lease conflict with the terms of the Loan Documents (e.g. required
insurance, use of casualty or condemnation provisions), the terms and conditions
of the Loan Documents shall prevail.

(n)        New Franchise Agreement.  The New Franchise Agreement, a correct and
complete copy of which has been delivered to Lender, under which Operating
Lessee has the right to operate the hotel located on the Property (“Hotel”) as a
Home2 Suites by Hilton, is in full force and effect and there is no default,
breach, or violation existing thereunder by any party thereto and there is no
default, breach or violation existing thereunder by any party thereto and no
event has occurred that, with the passage of time or the giving of notice, or
both, would constitute a default, breach or violation by any party
thereunder.  All fees payable under the New Franchise Agreement have been paid
through the Effective Date and payment of fees due thereunder is subordinate to
the lien created by the Security Instrument.  Operating Lessee shall not
terminate, modify, renew or extend the New Franchise Agreement, or enter into
any agreement relating to the right to operate the Hotel under a name other than
"Home2 Suites by Hilton Lubbock", without the prior express written consent of
Lender.  Operating Lessee shall comply with all terms of the New Franchise
Agreement and shall operate the Hotel in compliance with its terms, including,
but not limited to, the maintenance and operation of the facilities required to
serve alcoholic beverages.  New Borrower shall comply with all terms of the Loan
Documents regarding the operation of the Property as a hotel.  Operating Lessee
shall, and shall cause Franchisor to, execute and deliver to Lender a new
comfort letter in favor of Lender in form and substance satisfactory to Lender
(the "New Comfort Letter").  Following the Effective Date, the term "Franchise
Agreement" in the Security Instrument shall refer to the New Franchise
Agreement.

(o)        Property Improvement Plan.

(i)         In connection with the New Franchise Agreement, Franchisor requires
Operating Lessee to make certain improvements, repairs, maintenance, alterations
and/or renovations to the Property (collectively, the "PIP Improvements") by
certain deadlines as more particularly set forth in the Property Improvement
Plan dated as of August 23, 2019 (the "PIP"), a copy of which is attached to
this Agreement as Exhibit F.  New Borrower shall comply, in all material
respects, with all terms of the PIP and timely and diligently complete the PIP
Improvements in a lien-free manner in accordance with the PIP Budget (as defined
below), all Legal Requirements and in compliance with the requirements of the
PIP, the New Franchise Agreement, this Agreement and the other Loan Documents on
or before the deadlines set forth in the PIP and/or the New Franchise Agreement
(or such longer time as the Franchisor may agree in writing).  The Hotel shall
remain open for business at all times during the PIP Improvements. New Borrower
shall promptly provide Lender with written notice of the timely completion of
the PIP Improvements and, upon request by Lender from time to time, provide
evidence of such timely, lien-free completion and compliance reasonably
satisfactory to Lender.  New Borrower's failure to complete (or cause to be
completed) the PIP Improvements lien-free on or before the deadlines prescribed
by, or in conformance with, the PIP, the New Franchise Agreement, this Agreement
and/or the other Loan Documents shall be an Event of Default under the Loan
Documents.

(ii)        On the Effective Date, New Indemnitor shall execute and deliver to
Lender a Payment and Completion Guaranty (the “Completion Guaranty”),
guaranteeing, among other things, the payment and completion of all PIP
Improvements as set forth in the PIP.

(iii)       On the Effective Date, New Borrower shall deposit with Lender, by
wire transfer of immediately available funds, $68,273.00 (the "First PIP Reserve
Deposit"), which shall be transferred to the FF&E Reserve Account held by Lender
as additional security for the Loan and disbursed in accordance with Section
6.5.2 of the Loan Agreement.  On or prior to December 31, 2020, New Borrower
shall deposit with Lender, by wire transfer of immediately available funds,
$68,273.00 (the "Second PIP Reserve Deposit"), which shall be transferred to the
FF&E Reserve Account held by Lender as additional security for the Loan and
disbursed in accordance with Section 6.5.2 of the Loan Agreement.  On or prior
to December 31, 2021, New Borrower shall deposit with Lender, by wire transfer
of immediately available funds, $136,545.00 (the "Third PIP Reserve Deposit,"
together with the First PIP Reserve Deposit and the Second PIP Reserve Deposit,
collectively, the "PIP Reserve Deposit"), which shall be transferred to the FF&E
Reserve Account held by Lender as additional security for the Loan and disbursed
in accordance with Section 6.5.2 of the Loan Agreement.  The PIP Reserve Deposit
shall constitute part of the Reserve Funds described in the Loan Agreement.
Notwithstanding anything to the contrary in Article 6 of the Loan Agreement, (i)
the PIP Reserve Deposit shall be disbursed by Lender for payment of the PIP
Costs (as such term is defined below) in accordance with the terms of this
Agreement, the PIP Budget (as defined below) and the terms of Section 6.5.2 of
the Loan Agreement, and (ii) the PIP Reserve Deposit released to New Borrower
shall be used exclusively in respect of the PIP Improvements unless otherwise
approved in writing by Lender.

(iv)       The PIP Reserve Deposit represents 125% of the estimated costs to
complete the PIP (the "PIP Costs"), as more particularly outlined on the
certified budget attached as Exhibit G to this Agreement (the "PIP Budget"). New
Borrower shall complete the PIP Improvements in accordance with the PIP Budget
approved by Lender. New Borrower shall not revise the PIP Budget without
Lender's prior written consent. Lender may, as a condition to Lender's consent
of any proposed changes to the PIP Budget, require New Borrower to deposit with
Lender additional funds in such amount as Lender reasonably determines is
necessary to cover any increases in the PIP Costs, which funds shall be paid to
Lender within five (5) Business Days of such request made by Lender. Without the
prior written consent of Lender, New Borrower shall not use any of the PIP
Reserve Deposit released by Lender for any purpose other than the payment of the
PIP Costs in amounts not to exceed the amounts set forth for each expense item
in the PIP Budget.

(v)        Promptly upon the completion of the PIP Improvements and as a
condition precedent to Lender's final disbursement of the PIP Reserve Deposit,
New Borrower shall, in addition to any and all other requirements, items and
conditions for disbursement required to be satisfied pursuant to Article 6 of
the Loan Agreement, deliver to Lender: (i) an Officer's Certificate certifying
to Lender the timely and lien-free completion of the PIP Improvements in
compliance with the PIP, the New Franchise Agreement, this Agreement and the
other Loan Documents; (ii) written acknowledgment of the Franchisor in form
satisfactory to Lender confirming that the PIP Improvements have been completed
in accordance with the requirements of the New Franchise Agreement and approved
by Franchisor; (iii) evidence satisfactory to Lender that title to the Property
is free and clear of all Liens other than the Permitted Encumbrances, including
an updated and current title report and copies of all lien waivers and releases
from all persons or entities performing labor thereon or furnishing materials
therefor; and (iv) evidence that all permits for the PIP Improvements have been
closed and all approvals by governmental authorities with respect to the
completion of the PIP Improvements have been granted or issued.

 

(vi)       Lender shall have the right to establish subaccounts within the FF&E
Reserve Account to segregate amounts on deposit from the PIP Reserve Deposit and
monthly payments due to the FF&E Reserve Account as required under Article 6.5.1
of the Loan Agreement.

(vii)      The deposit by New Borrower of the PIP Reserve Deposit shall not
relieve New Borrower from any of its obligations under the Loan Agreement or any
of the other Loan Documents to make any deposit or monthly payments as required
under Article 6 of the Loan Agreement.

(p)        Insurance.  Notwithstanding anything in the Operating Lease to the
contrary, New Borrower shall maintain all insurance coverage required to be
maintained by New Borrower under the Loan Documents and by Operating Lessee
under the New Franchise Agreement, and shall cause Property Manager to maintain
the insurance required of Property Manager under the Management Agreement and to
comply in all material respects with all insurance requirements set forth in the
Loan Documents.

(q)        Cash Management Agreement.  New Borrower shall execute and deliver to
Lender contemporaneously with the execution and delivery of this Agreement, (a)
a Deposit Account Control Agreement (Soft Lockbox) between Wells Fargo Bank,
National Association, as Bank, Lender and New Borrower dated as of the Effective
Date (the "New Clearing Account Agreement") in form and content acceptable to
Lender, and (b) an Amendment to Cash Management Agreement between New Borrower,
Lender and Property Manager dated as of the Effective Date (the "Amendment to
CMA") in form and content acceptable to Lender, which New Clearing Account
Agreement and Amendment to CMA shall be effective as of the Effective Date. New
Borrower agrees and acknowledges that (i) the Cash Management Agreement is in
full force and effect, and (ii) all actions have been taken to open any new
accounts required under the New Clearing Account Agreement for the New
Borrower.  The term "Clearing Account Agreement" in the Loan Documents shall
subsequently refer to the New Clearing Account Agreement.  The term "Cash
Management Agreement" in the Loan Documents shall subsequently refer to the Cash
Management Agreement, as amended by the Amendment to CMA and this Agreement.  On
the Effective Date, New Borrower shall deliver (A) a Tenant Direction Letter to
each commercial Tenant at the Property and (B) a Credit Card Direction Letter to
each of the credit card banks which New Borrower has entered into agreements for
the clearance of credit card receipts, as set forth in the Cash Management
Agreement.

(r)         Annual Budget.  Operating Lessee shall provide to Lender an Annual
Budget for the Property pursuant to and in accordance with the requirements of
Section 4.1.7(g) of the Loan Agreement.  Operating Lessee shall operate, or
cause the Property Manager to operate, the Property in accordance with the
Annual Budget or, if applicable, the Approved Annual Budget.

(s)        Prohibited Person.  After review of the website identified below,
that none of New Borrower or, to the best of New Borrower's knowledge, New
Borrower Parties or any of their respective officers, directors, shareholders,
partners, members or affiliates (including other holders of indirect equity
interests in New Borrower) is an entity or person (i) that is listed in the
Annex to, or is otherwise subject to the provisions of, Executive Order 13224,
issued on September 24, 2001 (“EO13224“), (ii) whose name appears on the United
States Treasury Department’s Office of Foreign Assets Control (“OFAC“) most
current list of “Specifically Designated Nationals and Blocked Persons“ (which
list may be published from time to time in various media including, but not
limited to, the OFAC website,
http://www.treas.gov/offices/enforcement/ofac/sdn/t11sdn.pdf, (iii) who commits,
threatens to

commit or supports “terrorism“, as that term is defined in EO13224, or (iv) who,
to the knowledge of New Borrower, is otherwise affiliated with any entity or
person listed above (any and all parties or persons described in clauses
[i] – [iv] above are collectively referred to as a “Prohibited Person“).  None
of New Borrower Parties or any of their respective officers, directors,
shareholders, partners, members or affiliates (including other holders of
indirect equity interests in New Borrower) will (a) knowingly conduct any
business, or engage in any transaction or dealing, with any Prohibited Person,
including, but not limited to, the making or receiving of any contribution of
funds, goods, or services, to or for the benefit of a Prohibited Person, or
(b) knowingly engage in or conspire to engage in any transaction that evades or
avoids, or has the purpose of evading or avoiding, or attempts to violate, any
of the prohibitions set forth in EO13224.  New Borrower covenants and agrees to
deliver (from time to time) to Lender any such certification as may be requested
by Lender in its reasonable discretion, confirming that, based on reasonable
inquiry (x) none of New Borrower Parties or any of their respective officers,
directors, shareholders, partners, members or affiliates (including other
holders of indirect equity interests in New Borrower) is a Prohibited Person and
(y) none of New Borrower, or to the best of New Borrower's knowledge, any of the
other New Borrower Parties, or their respective officers, directors,
shareholders, partners, members or affiliates (including the holders of indirect
equity interests in New Borrower) has (a) knowingly conducted any business, or
engaged in any transaction or dealing, with any Prohibited Person,
including,  but not limited to, the making or receiving of any contribution of
funds, goods, or services, to or for the benefit of a Prohibited Person or (b)
knowingly engaged in or conspired to engage in any transaction that evaded or
avoided, or had the purpose of evading or avoiding, or attempted to violate, any
of the prohibitions set forth in EO13224.

(t)         Loan Documents.  The Loan Documents, from and after the Effective
Date, are valid and legally binding obligations of New Borrower, enforceable
against New Borrower and the Property in accordance with their terms.  This
Agreement and the execution of other contemplated documents do not constitute
the creation of a new debt or the extinguishment of the debt evidenced by the
Loan Documents, and they shall not in any way affect or impair the liens and
security interests created by the Loan Documents, which New Borrower
acknowledges to be valid and existing liens and security interests in the
Property.  New Borrower agrees that the lien and security interests created by
the Loan Documents continue to be in full force and effect, unaffected and
unimpaired by this Agreement or by the transfer of the Property or any
collateral described in financing statements filed in connection with the Loan
Documents and that said liens and security interests shall so continue in their
perfection and priority until the debt secured by the Loan Documents is fully
discharged.  New Borrower has no defenses, affirmative defenses, setoffs,
claims, counterclaims, crossclaims or causes of action of any kind or nature
whatsoever against the Lender Parties with respect to (i) the Loan, (ii) the
indebtedness due under the Loan Documents ("Indebtedness"), (iii) the Loan
Documents, or (iv) the Property.  To the extent New Borrower would be deemed to
have any such defenses, affirmative defenses, setoffs, claims, counterclaims,
crossclaims or causes of action as of the Effective Date, New Borrower knowingly
waives and relinquishes them.  New Borrower acknowledges that it has received
copies of all of the Loan Documents.

(u)        No Default.  To New Borrower's knowledge, no event, fact or
circumstance has occurred or failed to occur which constitutes, or with the
lapse or passage of time, giving of notice or both, could constitute a default
or Event of Default under the Loan Documents.

(v)        Inspections.  Other than the Property Condition Report and Visual
Mold and Moisture Inspection Report for the Property dated September 12, 2019,
prepared by Partner

Engineering and Science, Inc., under Project No. 19-256897, the Zoning Report
for the Property dated September 6, 2019, prepared by Partner Engineering and
Science, Inc., under Project No. 19-256897, the Phase 1 Environmental Site
Assessment for the Property dated October 28, 2019, prepared by EBI Consulting
under Project No. 1119006655, and the survey of the Property dated August 16,
2019, prepared by David Geomatics, LLC under Project No. 19-08-070, New Borrower
has not obtained any other written inspection reports relating to the
Property.  New Borrower has not obtained any tenant estoppel certificates from
the tenants located at the Property that have not been delivered to Lender.

(w)       Organizational Chart.  The organizational chart attached hereto as
Exhibit D is a true and correct representation of New Borrower's ownership
structure.

(x)        Reaffirmation.  To New Borrower's actual knowledge, New Borrower
affirms and confirms the truth and accuracy of all representations and
warranties in the Loan Documents, in all material respects, as if made on the
Effective Date.

ARTICLE 2

ACKNOWLEDGMENTS AND COVENANTS OF BORROWER PARTIES

As a material inducement to Lender to enter into this Agreement and to consent
to Requested Actions each of Borrower Parties, as to itself only, acknowledges,
warrants, represents, covenants and agrees to and with Lender as follows:

2.1.      Assumption of Loan.  New Borrower assumes the indebtedness due under
the Note, the Loan and all of Original Borrower’s other obligations, as grantor,
mortgagor, borrower, assignor, trustor, indemnitor, guarantor, or maker, as the
case may be, under the Loan Documents to the same extent as if New Borrower had
signed such instruments.  New Borrower agrees to comply with and be bound by all
the terms, covenants and agreements, conditions and provisions set forth in the
Loan Documents.

2.2.      Indebtedness.  As of December 18, 2019, the outstanding principal
balance of the Loan was $8,000,429.81, and the following escrow and reserve
balances (collectively, "Escrow Balances") are being held by Lender: (a) a tax
escrow balance of $149,156.92; (b) an insurance escrow balance of $0.00; and (c)
a FF&E reserve escrow balance of $410,058.08.  Borrower Parties acknowledge and
agree that Lender will continue to hold the Escrow Balances for the benefit of
New Borrower in accordance with the terms of the Loan Documents.  In the event
of any error in,  or omission from, the foregoing, Lender shall not be
prejudiced, limited, or estopped, in any way in its right to charge, collect and
receive any and all monies lawfully due Lender under the Loan Documents.  Lender
represents and warrants to New Borrower that to Lender's actual knowledge (i)
the amounts set forth above are correct, (ii) Lender has not issued any written
notices of default to Original Borrower which have not been cured, and (iii)
there are no existing material defaults under the Loan Documents.

2.3.      Assumption and Other Fees.  Simultaneously with or prior to the
Effective Date, New Borrower shall pay to or has paid Lender: (a) an processing
fee of $25,000.00; (b) an assumption fee equal to $40,002.15, which is 0.5% of
the outstanding principal balance of the Loan; (c) a modification fee equal to
$40,002.15, which is 0.5% of the outstanding principal balance of the Loan; (d)
reasonable legal fees; and (e) such other costs, fees, and expenses as shown in
the closing statement executed by Borrower Parties in connection with the
closing of this transaction.  Each of the Borrower Parties agrees that the
foregoing are fees for new consideration and are not interest charged in
connection with the Loan.

2.4.      Payment of Transaction Costs and Expenses.  New Borrower shall pay at
the time of execution of this Agreement by Lender:  (a) the reasonable legal
fees and disbursements of Lender's counsel, Bilzin Sumberg Baena Price & Axelrod
LLP, in connection with the preparation of this Agreement and the transactions
contemplated in this Agreement; (b) all recording costs and documentary stamps,
or other taxes if any, due upon the recording of this Agreement; and (c) the
costs of updating Lender's policy of title insurance insuring the Security
Instrument to a current date and endorsing such policy to include this Agreement
in the description of the Security Instrument with no additional exceptions, or,
at Lender's option, the cost of obtaining a new Lender's policy of title
acceptable to Lender insuring the Loan Documents as affected by this Agreement.

2.5.      Post Closing Transfer of Licenses.  The only licenses, permits and
operating agreements (collectively the "Licenses") that are required by
applicable law for the operation of the Property as it is currently being
operated are described on the attached Exhibit E.  Within thirty (30) days after
the Effective Date, the Licenses shall be either (a) transferred by Original
Borrower into the name of Fee Borrower or Operating Lessee, as applicable, to
the extent such Licenses are transferrable, or (b) obtained anew by Fee Borrower
or Operating Lessee, as applicable. The failure to timely transfer or obtain, as
applicable, the Licenses shall constitute an Event of Default under the Loan
Agreement.

2.6.      Information.

(a)        New Borrower and New Indemnitor confirm that all information provided
to Lender and/or any Servicer by or on behalf of New Borrower and/or New
Indemnitor or any of their respective employees, officers, directors, partners,
members, managers or representatives, in connection with or relating to (i) the
Requested Actions, (ii) this Agreement or the contemplated transactions or (iii)
the Property, contains no untrue statement of material fact and does not omit a
material fact necessary in order to make such information not materially
misleading (collectively, the "NB Disclosure Representations").  New Borrower
and New Indemnitor, jointly and severally, agree to reimburse, indemnify and
hold Lender Parties harmless from and against any and all liabilities,
judgments, costs, claims, damages, penalties, expenses, losses or charges
(including, but not limited to, all reasonable legal fees and court costs)
(collectively, "Indemnification Costs"), which may now or in the future be
undertaken, suffered, paid, awarded, assessed or otherwise incurred as a result
of or arising out of any breach or inaccuracy of the NB Disclosure
Representations or any fraudulent or tortious conduct of New Borrower and/or New
Indemnitor in connection with the Requested Actions, this Agreement or the
contemplated transactions, or the Property, including any misrepresentation of
financial data presented to Lender and/or Servicer.  The provision of any such
information by Lender or any Servicer to any rating agency is expressly
consented to by New Borrower and New Indemnitor and will not infringe upon or
violate any intellectual property rights of any party.

(b)        Original Borrower and Original Indemnitor (as such term is defined in
the Joinder By and Agreement of Original Indemnitor attached to this Agreement
(the "Original Indemnitor Joinder")), confirm that all information provided to
Lender and/or any Servicer by or on behalf of Original Borrower and/or Original
Indemnitor or any of their respective employees, officers, directors, partners,
members, managers or representatives, in connection with or relating to (i) the
Requested Actions, (ii) this Agreement or the contemplated transactions or (iii)
the Property, contains no untrue statement of material fact and does not omit a
material fact necessary in order to make such information not materially
misleading, (collectively, the "OB Disclosure Representations").  Original
Borrower and Original Indemnitor, jointly and severally, agree to reimburse,
indemnify and hold Lender Parties harmless from and against any and all

Indemnification Costs, which may now or in the future be undertaken, suffered,
paid, awarded, assessed or otherwise incurred as a result of or arising out of
any breach or inaccuracy of the OB Disclosure Representations or any fraudulent
or tortious conduct of Original Borrower and/or Original Indemnitor in
connection with the Requested Actions, this Agreement or the contemplated
transactions, or the Property, including any misrepresentation of financial data
presented to Lender and/or Servicer.  The provision of any such information by
Lender and/or any Servicer to any rating agency is expressly consented to by
Original Borrower and Original Indemnitor and will not infringe upon or violate
any intellectual property rights of any party.

2.7.      Release and Covenant Not To Sue.  Each of Borrower Parties and
Original Indemnitor, as to itself and all of its heirs, successors and assigns
(collectively, "Releasing Parties"), remises, releases, acquits, satisfies and
forever discharges Lender Parties from any and all manner of debts, accountings,
bonds, warranties, representations, covenants, promises, contracts,
controversies, agreements, liabilities, obligations, expenses, damages,
judgments, executions, actions, inactions, claims, demands and causes of action
of any nature whatsoever, whether at law or in equity, whether known or unknown,
either now accrued or subsequently maturing, which any of Releasing Parties now
has or subsequently can, shall or may have by reason of any matter, cause or
thing, from the beginning of the world to and including the Effective Date,
including, without limitation, matters arising out of or relating to (a) the
Loan, (b) the Loan Documents, (c) the Indebtedness, (d) the Property, and (e)
any other agreement or transaction between Releasing Parties or any one of them
and any of Lender Parties concerning matters arising out of or relating to the
items set forth in subsections (a) – (d) above.  Each of Releasing Parties
covenants and agrees never to institute or cause to be instituted or continue
prosecution of any suit or other form of action or proceeding of any kind or
nature whatsoever against any of Lender Parties by reason of or in connection
with any of the foregoing matters, claims or causes of action.

2.8.      Immediate Repairs.  New Borrower shall perform the repairs at the
Property set forth on Exhibit H hereto (such repairs hereinafter referred to as
"Immediate Repairs"). New Borrower shall complete each of the Immediate Repairs
within one hundred and twenty (120) days from the Effective Date and shall
provide Lender with evidence of such completion.  The failure to timely complete
the Immediate Repairs and provide Lender with evidence of such completion shall
constitute an Event of Default under the Loan Agreement.

2.9.      Further Assurances.  Borrower Parties shall execute and deliver to
Lender such agreements, instruments, documents, financing statements and other
writings as may be requested from time to time by Lender to perfect and to
maintain the perfection of Lender's security interest in and to the Property,
and to consummate the transactions contemplated by or in the Loan Documents and
this Agreement.

ARTICLE 3

ADDITIONAL PROVISIONS

3.1.      Modifications to Loan Documents.  The Loan Documents are modified in
accordance with the terms of Schedule 3.1 attached.

3.2.      Consent of Lender.  Subject to the terms of this Agreement, Lender
consents to the Requested Actions.  Each of Borrower Parties, Original
Indemnitor and New Indemnitor  agrees that neither this Agreement nor Lender’s
consent to the Requested Actions shall be deemed Lender’s consent or a waiver of
Lender’s right to consent to any other action requiring Lender consent under the
Loan Documents that may be contained in any of the documents or items

delivered to Lender in connection with the Requested Actions, whether or not
such documents or items were reviewed and/or accepted by Lender.  Moreover,
neither this Agreement nor Lender’s consent to the Requested Actions shall
constitute a modification of any of the terms of the Loan Documents, except as
expressly provided for in this Agreement.

3.3.      Release of Original Indemnitor and Original Borrower.  Lender releases
(i) Original Indemnitor from its obligations under the Guaranty and the
Environmental Indemnity  in accordance with and subject to the terms of the
Original Indemnitor Joinder and (ii) Original Borrower for any acts or events
occurring or obligations arising under the Loan Documents from and after the
Effective Date with the exception of any liability of Original Borrower based
upon (a) any material misrepresentation by Original Borrower or a breach of any
covenant in any material respect in this Agreement or any other document
executed in connection with this Agreement and/or (b) the obligations under (i)
Section 11.22 of the Loan Agreement (the “Exculpation Environmental
Obligations”), (ii) the Environmental Indemnity or (iii) any of the other Loan
Documents that are caused by Original Borrower, Original Indemnitor or any of
their agents or result from the existence of conditions existing prior to the
Effective Date or migrating to or from any portion of the Property prior to the
Effective Date, or result from a violation of Environmental Laws (as defined in
the Environmental Indemnity) prior to the Effective Date (collectively, the
"Borrower's Recourse Environmental Obligations"). Original Borrower shall bear
the burden of proving when Hazardous Substances (as defined in the Environmental
Indemnity) first existed upon, about or beneath the Property or began migrating
to or from the Property and when a violation of Environmental Laws first
occurred.  The foregoing burden of proof is for the benefit of the Lender, its
successors and assigns, and is not for the benefit of any other party.

3.4.      UCC Filings.  New Borrower grants and confirms unto Lender a first
lien priority security interest in all of New Borrower's assets owned as of the
Effective Date or subsequently acquired, including but not limited to (i) all of
its personal property and all of the fixtures located at the Property and (ii)
the Personal Property (as such term is defined in the Security Instrument),
including, without limitation, the Collateral (as such term is defined in the
Security Instrument), to the maximum extent permitted by the Uniform Commercial
Code ("UCC").  Borrower Parties hereby consent to the filing of any financing
statements or UCC forms required to be filed in the applicable states or any
other applicable filing office, including, but not necessarily limited to, the
state of organization of New Borrower and in the Records (collectively
"Filings") in order to perfect or continue the perfection of said interest and,
notwithstanding anything contained in any of the Loan Documents to the contrary,
in accordance with the UCC, as amended subsequent to the making of the Loan,
said Filings may be made by Lender without the consent of either of the Borrower
Parties.

3.5.      References to Loan Documents.  All references to the term Loan
Documents in this Agreement (including the Joinders attached hereto), the Loan
Agreement, the Security Instrument, the Guaranty and the other Loan Documents
are modified to include this Agreement and all documents executed and/or
required in connection with the Requested Actions. All references to the terms
"Loan Documents," "Loan Agreement," "Security Instrument" and "Guaranty" in this
Agreement, (including the Joinders attached hereto), the Loan Agreement, the
Security Instrument and the other Loan Documents shall mean and refer to the
Loan Documents, the Loan Agreement, the Security Instrument, and the Guaranty,
as assumed and modified by the terms of this Agreement and/or the Joinder By and
Agreement of New Indemnitor attached to this Agreement (the "New Indemnitor
Joinder").

ARTICLE 4

MISCELLANEOUS PROVISIONS

4.1.      No Limitation of Remedies.  No right, power or remedy conferred upon
or reserved to or by Lender in this Agreement is intended to be exclusive of any
other right, power or remedy conferred upon or reserved to or by Lender under
this Agreement, the Loan Documents or at law.  Each and every such right, power
and remedy shall be cumulative and concurrent, and shall be in addition to each
and every other right, power and remedy given under this Agreement, the Loan
Documents or now or subsequently existing at law.

4.2.      No Waivers.  Except as otherwise expressly set forth in this
Agreement, nothing in this Agreement shall constitute a waiver of any rights or
remedies of Lender under the Loan Documents or at law.  No delay or failure on
the part of any party in the exercise of any right or remedy under this
Agreement shall operate as a waiver, and no single or partial exercise of any
right or remedy shall preclude other or further exercise thereof or the exercise
of any other right or remedy.  No action or forbearance by any party contrary to
the provisions of this Agreement shall be construed to constitute a waiver of
any of the express provisions.  Any party may in writing expressly waive any of
such party's rights under this Agreement without invalidating this Agreement.

4.3.      Successors or Assigns.  Whenever any party is named or referred to in
this Agreement, the heirs, executors, legal representatives, successors,
successors-in-title and assigns of such party shall be deemed included, but the
provision shall not be deemed to permit any transfer by either of the Borrower
Parties.  All covenants and agreements in this Agreement shall bind and inure to
the benefit of the heirs, executors, legal representatives, successors,
successors-in-title and assigns of the parties, whether so expressed or not.

4.4.      Construction of Agreement.  Each party to this Agreement acknowledges
that it has participated in the negotiation of this Agreement and no provision
shall be construed against or interpreted to the disadvantage of any party by
any court or other governmental or judicial authority by reason of such party
having or being deemed to have structured, dictated or drafted such
provision.  Borrower Parties at all times have had access to an attorney in the
negotiation of the terms of and in the preparation and execution of this
Agreement and have had the opportunity to review and analyze this Agreement for
a sufficient period of time prior to execution and delivery.  No representations
or warranties have been made by or on behalf of Lender, or relied upon by
Borrower Parties, pertaining to the subject matter of this Agreement, other than
those set forth in this Agreement.  All prior statements, representations and
warranties, if any, are totally superseded and merged into this Agreement, which
represents the final and sole agreement of the parties with respect to the
subject matters.  All of the terms of this Agreement were negotiated at arm's
length, and this Agreement was prepared and executed without fraud, duress,
undue influence or coercion of any kind exerted by any of the parties upon the
others.  The execution and delivery of this Agreement are the free and voluntary
act of Borrower Parties.

4.5.      Invalid Provision to Affect No Others.  If, from any circumstances
whatsoever, fulfillment of any provision of this Agreement or any related
transaction at the time performance of such provision shall be due, shall
involve transcending the limit of validity presently prescribed by any
applicable usury statute or any other applicable law, with regard to obligations
of like character and amount, then ipso facto, the obligation to be fulfilled
shall be reduced to the limit of such validity.  If any clause or provision
operates or would prospectively operate to invalidate this Agreement, in whole
or in part, then such clause or provision only shall be deemed deleted, as

though not contained in this Agreement, and the remainder of this Agreement
shall remain operative and in full force and effect.

4.6.      Notices.  Notwithstanding anything to the contrary in any of the Loan
Documents, any and all notices, elections, approvals, consents, demands,
requests and responses ("Communications") permitted or required to be given
under this Agreement or the Loan Documents shall not be effective unless in
writing, signed by or on behalf of the party giving the same, and sent by
certified or registered mail, postage prepaid, return receipt requested, by hand
delivery or by a nationally recognized overnight courier service (such as
FedEx), to the party to be notified at the address of such party set forth below
or at such other address within the continental United States as such other
party may designate by notice specifically designated as a notice of change of
address and given in accordance with this Section.  Any Communications shall be
effective upon the earlier of their receipt or three days after mailing in the
manner indicated in this Section.  Receipt of Communications shall occur upon
actual delivery but if attempted delivery is refused or rejected, the date of
refusal or rejection shall be deemed the date of receipt.  Notice to outside
counsel or parties other than the named Original Borrower, New Borrower and
Lender, now or subsequently designated by a party as entitled to notice, are for
convenience only and are not required for notice to a party to be effective in
accordance with this Section.  Any Communication, if given to Lender, must be
addressed as follows, subject to change as provided above:

WILMINGTON TRUST, NATIONAL ASSOCIATION, as Trustee

c/o Wells Fargo Bank, N.A.

Wells Fargo Commercial Mortgage Servicing

Three Wells Fargo

401 S. Tryon Street, 8th Floor

MAC D1050-084

Charlotte, North Carolina 28202

Re: JPMCC 2016-JP4;

With a copy to:

LNR Partners, LLC

1601 Washington Avenue, Suite 700

Miami Beach, Florida 33139

Attn:    Director of Loan Asset Management

Re:  JPMCC 2016-JP4

and, if given to Original Borrower, must be addressed as follows,
notwithstanding any other address set forth in the Loan Documents to the
contrary, subject to change as provided above:

TREEMONT CAPITAL PARTNERS III, LP

1415 South Voss #110-94

Houston, Texas  77057

Attn:  Philip A. McRae

With a copy to:

Sneed, Vine & Perry, P.C.

2705 Bee Cave Road, Suite 160

Austin, Texas  78745

Attn:  Adam S. Wilk/Kasi Moeskau

and, if given to New Borrower, must be addressed as follows, subject to change
as provided above:

LF3 LUBBOCK CASA, LLC

LF3 LUBBOCK CASA TRS, LLC

1635 43Rd Street South, Suite 205

Fargo, North Dakota  58103

Attn:  David Durell

With a copy to:

McShane & Bowie, P.L.C.

99 Monroe Avenue NW, Suite 1100

Grand Rapids, Michigan  49503

Attn:  John Faris, Esq.

4.7.      Governing Law.  This Agreement shall be interpreted, construed and
enforced in accordance with the provisions of Section 11.3 of the Loan
Agreement.

4.8.      Headings; Exhibits.  The headings of the articles, sections and
subsections of this Agreement are for the convenience of reference only, are not
to be considered a part of this Agreement and shall not be used to construe,
limit or otherwise affect this Agreement.

4.9.      Modifications.  The terms of this Agreement may not be changed,
modified, waived, discharged or terminated orally, but only by an instrument or
instruments in writing, signed by the party against whom the enforcement of the
change, modification, waiver, discharge or termination is asserted. Lender's
consent to the Requested Actions shall not be deemed to constitute Lender's
consent to any provisions of the organizational documents that would be in
violation of the terms of any of the Loan Documents.

4.10.    Time of Essence; Consents.  Time is of the essence of this Agreement
and the Loan Documents.  Any provisions for consents or approvals in this
Agreement shall mean that such consents or approvals shall not be effective
unless in writing and executed by Lender.

4.11.    Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which will
constitute the same agreement.  Any signature page of this Agreement may be
detached from any counterpart of this Agreement without impairing the legal
effect of any signatures thereon and may be attached to another counterpart of
this Agreement identical in form but having attached to it one or more
additional signature pages.

4.12.    New Indemnitor Joinder.  New Indemnitor shall assume the obligations of
Original Borrower and/or Original Indemnitor under the Guaranty and the
Environmental Indemnity pursuant to the New Indemnitor Joinder.

4.13.    WAIVER OF TRIAL BY JURY.  BORROWER PARTIES AND LENDER EACH HEREBY AGREE
NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVE
ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR
HEREAFTER EXIST WITH REGARD TO THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CLAIM,
COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER OF
RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY BY BORROWER PARTIES
AND LENDER AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH
ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. EACH
PARTY IS HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS
CONCLUSIVE EVIDENCE OF THIS WAIVER.

(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)

The parties have executed and delivered this Agreement as of the Effective Date.

 

 

 

 

Witnesses:

LENDER:

 

 

 

WILMINGTON TRUST, NATIONAL

 

ASSOCIATION, AS TRUSTEE FOR THE

 

BENEFIT OF THE REGISTERED HOLDERS

 

OF JPMCC COMMERCIAL MORTGAGE

 

SECURITIES TRUST 2016-JP4, COMMERCIAL

 

MORTGAGE PASS- THROUGH

 

CERTIFICATES, SERIES 2016- JP4

 

 

 

 

 

By:

LNR Partners, LLC, a Florida limited liability company, as attorney-in-fact

 

 

 

By:

LNR Partners, LLC, a Florida limited liability company, as attorney-in-fact

 

 

/s/ Samira Colon

By:

/s/ Job Warsha

Print Name:

Samira Colon

 

Job Warsha_____, _President_

 

 

/s/ Ciney Torres

 

Print Name:

Ciney Torres

 

 

 

 

STATE OF FLORIDA

)

 

 

) SS:

 

COUNTY OF MIAMI-DADE

)

 

 

The foregoing instrument was acknowledged before me this 26th day of December,
2019, by Job Warsha, as President of LNR Partners, LLC, a Florida limited
liability company, on behalf of said limited liability company, as
attorney-in-fact for WILMINGTON TRUST, NATIONAL ASSOCIATION, AS TRUSTEE FOR THE
BENEFIT OF THE REGISTERED HOLDERS OF JPMCC COMMERCIAL MORTGAGE SECURITIES TRUST
2016-JP4, COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2016-JP4, on
behalf of the said trust.  He _x____ is personally known to me or _____ has
produced a driver’s license as identification.

 

/s/ Patricia Mosquera

 

Notary Public, State of Florida

 

Print Name: Patricia Mosquera

 

My Commission Expires:

Sept.1 5, 2023

 

[AFFIX NOTARY STAMP ABOVE]

The parties have executed and delivered this Agreement as of the Effective Date.

 

 

 

Witnesses:

ORIGINAL BORROWER:

 

 

 

TREEMONT CAPITAL PARTNERS III, LP,

 

a Texas limited partnership

 

 

 

 

 

By:

Treemont Capital Partners III GP, LLC,

 

 

a Texas limited liability company,

 

 

its general partner

 

 

 

By:

Treemont Investments, Inc.,

 

 

a Texas corporation, its sole member

 

 

 

 

/s/ LaKeisha Jorchia

 

By:

/s/ Philip A. McRae

 

Print Name:

LaKeisha Jorchia

 

Name:

Philip A. McRae

 

Title:

President

 

 

 

/s/ Amy Methenry

 

Print Name:

Amy Methenry

 

 

 

 

STATE OF TEXAS

)

 

 

)

 

COUNTY OF

)

 

 

On 12/26     , 2019, before me,          Kay Street   , personally appeared
Philip A. McRae who proved to me on the basis of satisfactory evidence to be the
person whose name is subscribed to the within instrument and acknowledged to me
that he executed the same in his authorized capacity, and that by his signature
on the instrument the person, or the entity upon behalf of which the person
acted, executed the instrument.

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

WITNESS my hand and official seal.

Signature

/s/  Kay Street

      (Seal)

 

Sharon K. Street

 

Notary Public State of Texas

 

Comm. Expires: 12-04-2021

 

Notary ID 1901703

 

 

 

 

The parties have executed and delivered this Agreement as of the Effective Date.

 

 

 

 

Witnesses:

NEW BORROWER:

 

 

 

LF3 LUBBOCK CASA, LLC,

 

a Delaware limited liability company

 

 

 

By:

Lodging Fund REIT III OP, LP,

 

 

a Delaware limited partnership,

 

 

as sole member

 

 

 

By:

Lodging Fund REIT III, Inc.,

 

 

a Maryland corporation,

 

 

as general partner

 

 

/s/ Mitch Bossert

By:

/s/ Katie Cox

Print Name:

Mitch Bossert

Name:

Katie Cox

 

 

Title:

Chief Financial Officer

 

 

/s/ Angie Stock

 

Print Name:

Angie Stock

 

 

 

 

STATE OF NORTH DAKOTA

)

 

 

)

 

COUNTY OF CASS

)

 

 

On December 26 , 2019, before me, Jennifer Moum , personally appeared Katie Cox
who proved to me on the basis of satisfactory evidence to be the person whose
name is subscribed to the within instrument and acknowledged to me that he
executed the same in his authorized capacity, and that by his signature on the
instrument the person, or the entity upon behalf of which the person acted,
executed the instrument.

 

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

 

WITNESS my hand and official seal.

 

Signature /s/  Jennifer Moum  (Seal)

Jennifer Moum

Notary Public

State of North Dakota

My Commission Expires April 25, 2022

 

 

 

 

 

Witnesses:

NEW BORROWER:

 

 

 

LF3 LUBBOCK CASA TRS, LLC,

 

a Delaware limited liability company

 

 

 

By:

Lodging Fund REIT III TRS, Inc.,

 

 

a Delaware corporation,

 

 

as sole member

 

 

 

By:

Lodging Fund REIT III OP, LP,

 

 

a Delaware limited partnership,

 

 

as sole shareholder

 

 

 

 

By:

Lodging Fund REIT III, Inc.,

 

 

a Maryland corporation,

 

 

as general partner

 

 

/s/ Mitch Bossert

By:

/s/ Katie Cox

Print Name:

Mitch Bossert

Name:

Katie Cox

 

Title:

Chief Financial Officer

 

 

 

 

/s/ Angie Stock

 

Print Name:

Angie Stock

 

 

 

 

STATE OF NORTH DAKOTA

)

 

 

)

 

COUNTY OF CASS

)

 

 

On December 26 , 2019, before me, Jennifer Moum , personally appeared Katie Cox
who proved to me on the basis of satisfactory evidence to be the person whose
name is subscribed to the within instrument and acknowledged to me that he
executed the same in his authorized capacity, and that by his signature on the
instrument the person, or the entity upon behalf of which the person acted,
executed the instrument.

 

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

 

WITNESS my hand and official seal.

 

Signature /s/  Jennifer Moum  (Seal)

Jennifer Moum

Notary Public

State of North Dakota

My Commission Expires April 25, 2022

 

SCHEDULE 3.1

MODIFICATION TO LOAN DOCUMENTS

Section 3.1      From and after the Effective Date, the Loan Documents are
modified as follows:

 

(a)        All Loan Documents:

 

(i)         All references to the term “Borrower” in each of the Loan Documents
shall jointly and severally and individually and/or collectively, as the context
may require, mean and refer to "LF3 LUBBOCK CASA, LLC, a Delaware limited
liability company, and LF3 LUBBOCK CASA TRS, LLC, a Delaware limited liability
company."

 

(ii)        All references to the term “Lender” in each of the Loan Documents
shall mean and refer to "WILMINGTON TRUST, NATIONAL ASSOCIATION, AS TRUSTEE FOR
THE BENEFIT OF THE REGISTERED HOLDERS OF JPMCC COMMERCIAL MORTGAGE SECURITIES
TRUST 2016-JP4, COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2016-JP4,
together with its successors and assigns."

 

(iii)       All references (if any) to “Guarantor” in each of the Loan Documents
shall jointly and severally and individually and/or collectively, as the context
may require, mean and refer to "LODGING FUND REIT III, INC., a Maryland
corporation and LODGING FUND REIT III OP, LP, a Delaware limited partnership."

 

(iv)       The references (if any) to the term "Franchise Agreement" or such
other similar term in the Loan Documents shall mean and refer to the Franchise
Agreement dated on or about the Effective Date between Franchisor and Operating
Lessee with respect to the Property, together with any permitted amendment
thereto or permitted replacement thereto.

 

(v)        The references (if any) to the term "Franchisor" or such other
similar term in the Loan Documents shall mean and refer to Franchisor (as
defined herein), together with any permitted replacement franchisor acceptable
to Lender.

 

(vi)       The references (if any) to the term "Management Agreement" or
"management agreement" or such other similar term in the Loan Documents shall
hereafter refer to the New Management Agreement.

 

(vii)      The references (if any) to the term "Manager" or such other similar
term in the Loan Documents shall hereafter refer to the Property Manager (as
defined herein), or any other manager approved by Lender and the Rating Agencies
in accordance with the terms and conditions of the Loan Documents.

 

(b)        Loan Agreement:

 

(i)         The following definitions are added to Section 1.1 of the Loan
Agreement in their proper alphabetical order:

“Assumption Agreement” shall mean and refer to the Assumption Agreement entered
into as of the Effective Date (as such term is defined in the Assumption
Agreement) between

 

Lender, Original Borrower (as such term is defined therein) and New Borrower (as
such term is defined therein), together with Joinder By and Agreement of
Original Indemnitor executed by Original Indemnitor (as such term is defined
therein) and Joinder By and Agreement of New Indemnitor executed by Guarantor.

 

"Assumption Effective Date" shall mean the Effective Date (as defined in the
Assumption Agreement).

 

"Collateral Assignment of Operating Lease" shall mean that certain Collateral
Assignment of Agreements, Permits and Items Affecting Hotel Operations and
Subordination of Lease dated as of the Assumption Effective Date among Operating
Lessee, Fee Borrower and Lender, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.

 

"Fee Borrower" shall mean LF3 Lubbock Casa, LLC, a Delaware limited liability
company.

 

"Operating Lease" shall mean that certain Lease Agreement by and between Fee
Borrower, as landlord, and Operating Lessee, as tenant, dated as of December
____, 2019, as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time subject to the terms of the Loan Documents.

 

"Operating Lessee" shall mean LF3 Lubbock Casa TRS, LLC, a Delaware limited
liability company.

 

"PIP" shall mean that certain Product Improvement Plan dated August 23, 2019,
prepared by Franchisor and attached to the Franchise Agreement.

 

(ii)        The defined term "Assignment of Management Agreement" in Section 1.1
of the Loan Agreement is modified to read as follows: "Assignment of Management
Agreement" shall mean that certain Assignment of Management Agreement and
Subordination of Management Fees dated as of the Assumption Effective Date among
Operating Lessee, Fee Borrower, Manager, and Lender, as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to time.

 

(iii)      The defined term "Lease" in Section 1.1 of the Loan Agreement, and
all references to such term in the Loan Agreement, shall hereafter exclude the
Operating Lease.

 

(iv)       The defined term "Loan Documents" in Section 1.1 of the Loan
Agreement, and all references to such term in the Loan Agreement, shall
hereafter include the Collateral Assignment of Operating Lease.

 

(v)        The defined term "Operating Expenses" in Section 1.1 of the Loan
Agreement and all references to such term in the Loan Agreement, shall
hereinafter exclude all rent and other payments made under the Operating Lease.

 

 

(vi)       The defined term "PIP Work" in Section 1.1 of the Loan Agreement is
modified to read as follows: "PIP Work" shall mean those certain improvements,
repairs, replacements, maintenance, alterations and/or renovations to the
Property as more particularly specified in the PIP and any other improvements,
repairs, replacements, maintenance, alterations and/or renovations to the
Property as may be required by Franchisor to be completed from time to time.

 

(vii)      Section 3.1.24(a) and (b) of the Loan Agreement is deleted and
replaced with the following:

 

(a)        (A) as to Fee Borrower, Fee Borrower (i) has been, is, and will be
organized solely for the purpose of acquiring, developing, owning, holding,
selling, leasing, transferring, exchanging, managing and operating the Property,
entering into this Agreement with the Lender, refinancing the Property in
connection with a permitted repayment of the Loan, and transacting lawful
business that is incident, necessary and appropriate to accomplish the
foregoing, and (ii) has not owned, does not own, and will not own any asset or
property other than the Property, and incidental personal property necessary for
the ownership or operation of the Property; and (B) as to Operating Lessee,
Operating Lessee (i) has been is, and will be organized solely for the purpose
of leasing the Property that is subject to the Operating Lease and operating,
managing and maintaining the Property subject to the Operating Lease and
transacting lawful business that is incident, necessary and appropriate to
accomplish the foregoing, and (ii) has not owned, does not own, and will not own
any asset or property other than its leasehold interest in the Property pursuant
to the Operating Lease and personal property necessary or incidental to such
ownership or operation of the Property.

 

(b)        (A) as to Fee Borrower, Fee Borrower has not engaged and will not
engage in any business other than the ownership, management and operation of the
Property and Fee Borrower will conduct and operate its business as presently
conducted and operated, and (B) as to Operating Lessee, Operating Lessee has not
engaged and will not engage in any business unrelated to owning its leasehold
interest in the Property pursuant to the Operating Lease and personal property
necessary or incidental to such ownership or operation of the Property.

 

(viii)     Section 3.1.24(dd) of the Loan Agreement is deleted and replaced with
the following: "(dd) Except as contemplated by the Loan Documents, Borrower has
not, does not and will not have any of its obligations guaranteed by any
Affiliates."

 

(ix)       Section 3.1.29 of the Loan Agreement is deleted and replaced with the
following:

 

 

Organizational Status. Fee Borrower's exact legal name is: LF3 Lubbock Casa,
LLC. Fee Borrower is of the following organizational type (e.g., corporation,
limited liability company): limited liability company, and the jurisdiction in
which Fee Borrower is organized is: Delaware. Fee Borrower's Tax I.D. number is
84-3293898 and Fee Borrower's Delaware Organizational I.D. number is
803445131.  Operating Lessee's exact legal name is: LF3 Lubbock Casa TRS, LLC.
Operating Lessee is of the following organizational type (e.g., corporation,
limited liability company): limited liability company, and the jurisdiction in
which Operating Lessee is organized is: Delaware. Operating Lessee's Tax I.D.
number is 84-3283804 and Operating Lessee's Delaware Organizational I.D. number
is 803442100.

 

(x)        The first sentence of Section 4.1.7(a) of the Loan Agreement is
deleted and replaced with the following:

 

Borrower shall keep and maintain or will cause to be kept and maintained proper
and accurate books and records, in accordance with GAAP, or other sound
accounting principles reasonably acceptable to Lender, consistently applied, the
Uniform System of Accounts for Hotels, current edition, and the requirements of
Regulation AB, to the extent applicable, reflecting the financial affairs of
Borrower and all items of income and expenses in connection with the operation
of the Property.

 

(xi)       The first sentence of Section 4.1.7(b) of the Loan Agreement is
deleted and replaced with the following:

 

Not later than forty-five (45) days following the end of each fiscal quarter
(and for the first twelve (12) months following the Closing Date, not later than
fifteen (15) days following the end of each calendar month), Borrower shall
deliver to Lender unaudited operating statements, internally prepared on an
accrual basis including a balance sheet and profit and loss statement as of the
end of such quarter and for the corresponding quarter of the previous year, and
a statement of revenues and expenses for the year of date, a statement of Net
Operating Income for such quarter, a comparison of the year to date results with
(i) the results for the same period of the previous year, (ii) the results that
had been projected by Borrower for such period and (iii) the Annual Budget for
such period and the First Year, and a summary report detailing monthly
occupancy, including average daily rate.

 

(xii)      The first sentence of Section 4.1.7(d) of the Loan Agreement is
deleted and replaced with the following:

 

Not later than forty-five (45) days after the end of each fiscal quarter of
Borrower's operations, Borrower shall deliver to Lender a true and complete rent
roll for the Property, if applicable, dated as of the

 

last month of such fiscal quarter, showing the percentage of gross leasable area
of the Property, if any, leased as of the last day of the preceding calendar
quarter, the current annual rent for the Property, the expiration date of each
lease, whether to Borrower’s knowledge any portion of the Property has been
sublet, and if it has, the name of the subtenant, and such rent roll shall be
accompanied by an Officer’s Certificate certifying that such rent roll is true,
correct and complete in all material respects as of its date and stating whether
Borrower, within the past three (3) months, has issued a notice of default with
respect to any Lease which has not been cured and the nature of such default.

 

(xiii)     Section 6.1 of the Loan Agreement is deleted and replaced with the
following:

 

Cash Management Arrangements.  On or prior to the Assumption Effective Date,
Borrower shall establish and activate and thereafter, Borrower shall cause all
Rents to be transmitted directly by all commercial tenants at the Property and
all credit card banks which Borrower has entered into agreements for the
clearance of credit card receipts into a trust account (the "Clearing Account")
established and maintained by Borrower at the Clearing Bank as more fully
described in the Clearing Account Agreement.  Without in any way limiting the
foregoing, if Borrower or Manager receive any Gross Revenue from the Property,
then (i) such amounts shall be deemed to be collateral for the Obligations and
shall be held in trust for the benefit, and as the property, of Lender, (ii)
such amounts shall not be commingled with any other funds or property of
Borrower or Manager, and (iii) Borrower or Manager shall deposit such amounts in
the Clearing Account within one (1) Business Day of receipt. Funds deposited
into the Clearing Account shall be swept by the Clearing Bank on a daily basis
into Borrower’s operating account at the Clearing Bank, unless a Sweep Event
Period is continuing, in which event such funds shall be swept on a daily basis
into an Eligible Account at the Cash Management Bank controlled by Lender (the
“Cash Management Account”) and applied and disbursed in accordance with this
Agreement and the Cash Management Agreement. Funds in the Cash Management
Account shall be invested in Permitted Investments, as more particularly set
forth in the Cash Management Agreement. Lender may also establish subaccounts of
the Cash Management Account which shall at all times be Eligible Accounts (and
may be ledger or book entry accounts and not actual accounts) (such subaccounts
are referred to herein as “Accounts”). The Cash Management Account and all other
Accounts will be under the sole control and dominion of Lender, and Borrower
shall have no right of withdrawal therefrom. Borrower shall pay for all expenses
of opening and maintaining all of the above accounts.

 

 

(xiv)     Section 6.11.1(a)(ix) of the Loan Agreement is deleted and replaced
with the following:

 

(ix) Ninth, to the Borrower Operating Account, payments for the excess monthly
rent due, if any, under the Operating Lease; and

 

(xv)      Section 6.11.1(a) of the Loan Agreement is modified to add the
following as subsection (x):

 

(x) Lastly, all amounts remaining after payment of the amounts set forth in
clauses (i) through (ix) above (the "Remaining Receipts") to the Excess Cash
Flow Account.

 

(xvi)     Section 8.2 of the Loan Agreement is modified to add the following as
subsection (c):

 

(c)       For so long as Fee Borrower owns the Property, Operating Lessee owns
the leasehold interest in the Property pursuant to the Operating Lease, and
Lodging Fund REIT III, Inc., a Maryland corporation (the "REIT") indirectly owns
and indirectly controls Borrower, notwithstanding any provision in any Loan
Document to the contrary, the following transfers shall constitute Permitted
Transfers (subject only to any conditions set forth below) and shall not require
Lender’s consent: the issuance sale, conveyance, transfer or other disposition
(each, a "REIT Share Transfer") of any shares of common stock (the "REIT
Shares") in the REIT so long as (A) at the time of the REIT Share Transfer, the
REIT Shares are issued or traded in substantially the same method and manner as
they are currently issued and traded as of the Assumption Effective Date, (B)
the REIT Share Transfer does not cause a violation of any federal or state
securities laws, and (C) the REIT Share Transfer does not result in or cause a
Change of Control;

(i)         The foregoing shall not constitute and should in no manner be deemed
to constitute Lender's consent to the filing of an initial public offering of
the REIT Shares under a Form S-11 Registration Statement or otherwise in which
the REIT Shares are listed on a nationally recognized stock exchange or are to
be traded over the counter and listed in the National Association of Securities
Dealers Automatic Quotations (a "Public Offering").  Borrower agrees not to
conduct a Public Offering of the REIT Shares or any other securities of the REIT
without first obtaining the Lender's prior written consent.

(ii)        For purposes of this Section 8.2(c), in addition to any other
changes of Control contemplated by the Loan Documents, a "Change of Control"
shall also occur if: (i) the REIT reduces its ownership interest in Lodging Fund
REIT III OP, LP, a Delaware limited partnership ("OP") and Borrower below 51% or
is no longer the sole general partner and in Control of the OP, (ii) the OP is
no

 

longer the sole member of Fee Borrower and the sole shareholder of Lodging Fund
REIT III TRS, Inc., a Delaware corporation ("TRS"), (iii) TRS is no longer the
sole member of Operating Lessee, (iv) the REIT and OP are no longer the
Guarantors of the Loan, (v) one Person or group of affiliated Persons acquires
more than 49% of the REIT Shares in one or a series of transactions, (vi)
Legendary Capital, LLC, a North Dakota limited liability company ("Advisor") is
no longer the Advisor to the REIT, (vii) Corey R. Maple and Norman H. Leslie are
no longer members of the Board of Directors and C-Suite executives of the REIT,
(viii) Corey R. Maple and Norman H. Leslie are no longer the managing members or
managers or otherwise in Control of the Advisor, or (ix) the REIT enters into a
merger, consolidation or other business combination, or a sale of all or
substantially all of the REIT's assets and/or ownership interests (each, a
"Merger") which results in (1) the REIT or the OP not being the surviving
entity, or (2) Borrower otherwise no longer being directly or indirectly
controlled by the REIT.

(iii)       If a Merger results in the REIT or the OP being the surviving entity
(a "Surviving REIT Merger"), no Change of Control shall occur provided such
Surviving REIT Merger does not result in: (i) a material and adverse change in
the financial condition of the REIT or the OP, (ii) Borrower no longer being
directly or indirectly controlled by the REIT, (iii) the surviving REIT no
longer being the sole general partner of the OP and in Control of Borrower, or
(iv) a change in the majority of the Board of Directors of the REIT
(collectively, the, "Surviving REIT Merger Conditions"). Borrower shall provide
written notice to Lender of any such Surviving REIT Merger within ten (10)
business days after the closing of such Surviving REIT Merger, which notice
shall include a confirmation and reaffirmation from Borrower and any
indemnitor/guarantor that the Loan Documents continue to be legally binding and
enforceable against Borrower and such indemnitor/guarantor notwithstanding such
Surviving REIT Merger and confirming that such Surviving REIT Merger does not
result in a Change of Control and a breach of the Surviving REIT Merger
Conditions. In addition to delivering the items set forth above with the respect
to a Surviving REIT Merger, Borrower shall pay all of Lender's costs and
expenses, including Lender's attorneys' fees and costs, incurred by Lender in
connection with the Surviving REIT Merger and a processing fee of $5,000.00.

(iv)       The occurrence of any Change of Control as described above, without
first having obtained the prior written consent of Lender, or a breach of the
Surviving REIT Merger Conditions, shall constitute an "Event of Default" under
Section 10.1(a)(v) of the Loan Agreement, a "Springing Recourse Event" under
clause (iii) of the definition thereof under Section 11.22 of the Loan
Agreement, and a "Guaranteed Obligation" under Section 1.1 of the Guaranty.

 

(17)      Section 10.1 of the Loan Agreement is modified to add the following
clause (xxvii) at the end of subsection (a):

 

(xxvii)  if a material default shall occur under the Operating Lease which
continues beyond any applicable cure period set forth in the Operating Lease or
if any other default shall occur which entitles either Borrower to terminate the
Operating Lease and seek monetary damages.

 

(v)        The first sentence of Section 11.21 of the Loan Agreement is deleted
and replaced with the following: "Borrower hereby represents that, except for
Eric Guerrero (“Broker”), it has dealt with no financial advisors, brokers,
underwriters, placement agents, agents or finders in connection with the
transactions contemplated by this Agreement."

 

(vi)       Section 11.22 of the Loan Agreement is modified to add the following
as subsection (xx) to the definition of "Borrower's Recourse Liabilities":

 

(20)      Failure of Operating Lessee or Manager to fully cooperate with Lender
in the transition and transferring of its management responsibilities to
Manager, including, but not limited to, the employment of all eligible hotel
employees at the Property by Manager,  in connection with any enforcement action
or exercise or assertion of any right or remedy by or on behalf of Lender under
or in connection with this Agreement, the Guaranty, the Note, the Mortgage or
any other Loan Document. For purposes of this Section 11.22, "eligible hotel
employees" shall mean hotel employees that (a) have not performed illegal acts,
or (b) are not then under any disciplinary review or action.

 

(20)      Section 11.22 of the Loan Agreement is modified to add the following
as subsections (xi) and (xii) to the definition of "Springing Recourse Event":

 

(xi)       Failure of Operating Lessee to cause Manager to employ all eligible
hotel employees in connection with any enforcement action or exercise or
assertion of any right or remedy by or on behalf of Lender under or in
connection with this Agreement, the Guaranty, the Note, the Mortgage or any
other Loan Document; or

 

(xii)       In the event Lender exercises its option to terminate the Management
Agreement and transfers the responsibility for the management of the Property to
a new manager selected by Lender, failure of Manager to fully cooperate in
transferring its management responsibilities and the employment of all eligible
hotel employees at the Property to a new manager and effectuate such transfer
immediately upon written notice from Lender.

 

(vii)      The Rent Roll attached to this Agreement as Exhibit C shall replace
and be substituted for the Rent Roll attached to the Loan Agreement as Schedule
I.

 

 

(viii)    The organizational chart attached to this Agreement as Exhibit D shall
replace and be substituted for the organizational chart attached to the Loan
Agreement as Schedule III.

 

(ix)       From and after the Effective Date, and for so long as Fee Borrower
owns the Property, the words "ninety (90) days" in Section 4.1.7(c) of the Loan
Agreement shall be replaced with "one hundred and twenty (120) days."

 

(x)        From and after the Effective Date, and for so long as Fee Borrower
owns the Property, the word "November" in Section 4.1.7(g) of the Loan Agreement
shall be replaced with "December."

 

[END OF SCHEDULE 3.1]

 

 

EXHIBIT A

LEGAL DESCRIPTION

Picture 3 [lfr20191231ex105412c04001.jpg]

 

EXHIBIT B

LOAN DOCUMENTS

1.         Promissory Note dated as of the Loan Origination Date, in the
principal amount of $8,600,000.00 (the "Note"), executed by Original Borrower in
favor of Original Lender, and endorsed to the order of Lender.

2.         Loan Agreement, as assigned to Lender.

3.         Deed of Trust, Assignment of Leases and Rents and Security Agreement
dated as of the Loan Origination Date (the "Security Instrument"), executed by
Original Borrower in favor of Original Lender and recorded as Instrument No.
2016036108 in the Public Records of Lubbock County, Texas (the "Records"), as
assigned to Lender.

4.         Assignment of Leases and Rents dated as of the Loan Origination Date,
executed by Original Borrower in favor of Original Lender and recorded as
Instrument No. 2016036109 of the Records, as assigned to Lender.

5.         UCC Financing Statement reflecting Original Borrower, as debtor, and
Original Lender, as secured party, and recorded as Instrument No. 2016036110 of
the Records, as assigned to Lender.

6.         UCC Financing Statement reflecting Original Borrower, as debtor, and
Original Lender, as secured party, and filed with the Secretary of State of
Texas under File No. 16-0033125021, as assigned to Lender.

7.         Guaranty of Recourse Obligations dated as of the Loan Origination
Date (the "Guaranty"), executed by Original Indemnitor in favor of Original
Lender, as assigned to Lender.

8.         Environmental Indemnity Agreement dated as of the Loan Origination
Date (the "Environmental Indemnity"), executed by Original Borrower and Original
Indemnitor in favor of Original Lender, as assigned to Lender.

9.         Assignment of Management Agreement and Subordination of Management
Fees dated as of the Loan Origination Date executed by MH Partners, LLC, a
Tennessee limited liability company ("Original Manager"), as Property Manager,
and Original Borrower in favor of Original Lender, as assigned to Lender.

10.       Cash Management Agreement dated as of the Loan Origination Date
executed by Original Lender, Original Borrower and Original Manager, as assigned
to Lender.

11.       Deposit Account Control Agreement dated as of the Loan Origination
Date executed by Original Lender, Original Borrower and Wells Fargo Bank, N.A.,
a national banking association, as assigned to Lender.

 

 

EXHIBIT C

RENT ROLL

 

N/A

 

 

EXHIBIT C

RENT ROLL

(INTENTIONALLY DELETED FOR PURPOSES OF RECORDING)

 

 

EXHIBIT D

NEW BORROWER ORGANIZATIONAL CHART

 

 

EXHIBIT D

NEW BORROWER ORGANIZATIONAL CHART

(INTENTIONALLY DELETED FOR PURPOSES OF RECORDING)

 

 

EXHIBIT E

LICENSES

 

1)   Wine&Beer Retailer's On Premise Permit

2)   Certificate of Compliance for Elevators, Escalators and Related Equipment

3)   Permit to Operate Recreational Water Indoor Pool

4)   Permit to Operate Food Service

 

 

EXHIBIT E

LICENSES

(INTENTIONALLY DELETED FOR PURPOSES OF RECORDING)

 

 

EXHIBIT F

PIP

 

 

EXHIBIT F

PIP

(INTENTIONALLY DELETED FOR PURPOSES OF RECORDING)

 

 

EXHIBIT G

PIP BUDGET

 

 

EXHIBIT G

PIP BUDGET

(INTENTIONALLY DELETED FOR PURPOSES OF RECORDING)

 

 

EXHIBIT H

IMMEDIATE REPAIRS

 

Picture 100006 [lfr20191231ex105412c04002.jpg]

 

 

EXHIBIT H

IMMEDIATE REPAIRS

(INTENTIONALLY DELETED FOR PURPOSES OF RECORDING)

 

 

JOINDER BY AND AGREEMENT OF ORIGINAL INDEMNITOR

PHILIP A. MCRAE, an individual ("Original Indemnitor"), the guarantor/indemnitor
under the Guaranty and the Environmental Indemnity executed in connection with
the Loan described in the Agreement to which this Original Indemnitor Joinder is
attached, represents and warrants to, and acknowledges and agrees with, Lender
the following:

 

1.         Defined Terms.  All capitalized terms used in this Original
Indemnitor Joinder, unless defined below, shall have the meanings given such
terms in the Agreement.

2.         Reaffirmation of Guaranty and Environmental Indemnity.  The
Guaranty and the Environmental Indemnity constitute the valid, legally binding
obligations of Original Indemnitor, enforceable against Original Indemnitor in
accordance with their respective terms.  Original Indemnitor waives and releases
any and all defenses, affirmative defenses, setoffs, claims, counterclaims and
causes of action of any kind or nature which Original Indemnitor has asserted,
or might assert, against any of Lender Parties which in any way relate to or
arise out of the Guaranty and  Environmental Indemnity or any of the other Loan
Documents.

3.         Agreements of Original Indemnitor.  Original Indemnitor consents to
the execution and delivery of the Agreement by Original Borrower and New
Borrower and agrees and acknowledges that, except as set forth in paragraphs 5
and 6 below, the liability of Original Indemnitor under the Guaranty and the
Environmental Indemnity shall not be diminished in any way by the execution and
delivery of the Agreement or by the consummation of any of the transactions
contemplated therein, including but not limited to the Requested Actions.

4.         Authority Representations by the Original Indemnitor. The execution
and delivery of, and performance under, this Original Indemnitor Joinder, the
Guaranty and the Environmental Indemnity by Original Indemnitor will not (a)
violate any provision of any law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award presently in effect having
applicability to Original Indemnitor or (b) result in a breach of or constitute
or cause a default under any indenture, agreement, lease or instrument to
which  Original Indemnitor is a party or by which the Property may be bound or
affected.

5.         Release of Original Indemnitor under Guaranty.  Notwithstanding
anything to the contrary in this Original Indemnitor Joinder, the Loan
Agreement, the Security Instrument, or the other Loan Documents, Original
Indemnitor's obligations under this Original Indemnitor Joinder and under the
Guaranty shall not apply with respect to, and by acceptance of this Original
Indemnitor Joinder, Lender agrees that Original Indemnitor is released from any
and all of Original Indemnitor's obligations  under the Guaranty (the
"Guaranteed Obligations") for acts or events occurring or obligations arising
from and after the Effective Date except for:  (a) any material
misrepresentation by Original Indemnitor in this Original Indemnitor Joinder or
any other document executed in connection with this Original Indemnitor
Joinder,  (b) Guaranteed Obligations that are caused by Original Borrower and/or
Original Indemnitor and/or any of their agents, and/or (c) Guaranteed
Obligations that relate to any of the Borrower's Recourse Environmental
Obligations.  For purposes of this Original Indemnitor Joinder, Original
Indemnitor shall bear the burden of proving when Hazardous Substances (as
defined in the Environmental Indemnity) first existed upon, about or beneath the
Property or began migrating to or from the Property and when a violation of
Environmental Laws (as defined in the Environmental Indemnity) first occurred;
provided however, the foregoing burden of proof is for the benefit of Lender,
its successors and assigns, and is not for the benefit of any third party.

 

6.         Release of Original Indemnitor Under Environmental
Indemnity.  Notwithstanding anything to the contrary in this Original Indemnitor
Joinder, the Loan Agreement, the Security Instrument or the other Loan
Documents, Original Indemnitor's obligations under this Original Indemnitor
Joinder and under the Environmental Indemnity shall not apply with respect to,
and by acceptance of this Original Indemnitor Joinder, Lender agrees that
Original Indemnitor is released for all acts or events occurring or obligations
arising under the Environmental Indemnity ("Environmental Indemnity
Obligations") from and after the Effective Date unless such Environmental
Indemnity Obligations:  (a) are caused by Original Borrower, Original Indemnitor
and/or any of their agents, or (b) result from the existence of conditions
existing prior to the Effective Date or migrating to or from any portion of the
Property prior to the Effective Date, or result from a violation of
Environmental Laws prior to the Effective Date.  For purposes of this Original
Indemnitor Joinder, Original Indemnitor shall bear the burden of proving when
Hazardous Substance first existed upon, about or beneath the Property or began
migrating to or from the Property and when a violation of Environmental Laws
first occurred.  The foregoing burden of proof is for the benefit of Lender, its
successors and assigns, and is not for the benefit of any third party.

7.         Confirmation of Representations; Additional
Representations.  Original Indemnitor confirms (a) the representations and
warranties and agrees to the covenants regarding Original Indemnitor set forth
in the Agreement, including, but not limited to the obligations to pay the
Indemnification Costs, and (b) the truth and accuracy of all representations and
warranties set forth in the Guaranty and Environmental Indemnity, as
applicable.  Original Indemnitor represents and warrants that it delivered true
and complete copies of the Guaranty and the Environmental Indemnity to New
Indemnitor and warranted to New Indemnitor that such documents were true and
complete copies of such documents as signed by Original Indemnitor.

8.         Governing Law.  This Original Indemnitor Joinder shall be
interpreted, construed and enforced in accordance with the governing law
provisions of the Guaranty and the Environmental Indemnity, as applicable.

 

(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)

 

 

Original Indemnitor has executed and delivered this Original Indemnitor Joinder
to be effective as of the Effective Date of the Agreement.

 

 

 

 

Witnesses:

ORIGINAL INDEMNITOR:

 

 

 

/s/ Philip A. McRae

 

PHILIP A. MCRAE

 

 

 

 

/s/  LaKeisha Jorchia

 

 

By:

/s/ Philip A. McRae

 

Print Name:

LaKeisha Jorchia

 

 

 

 

 

 

 

/s/ Amy Methenry

 

Print Name:

Amy Methenry

 

 

 

 

STATE OF TEXAS

)

 

 

)

 

COUNTY OF

)

 

 

On 12/26     , 2019, before me,          Kay Street   , personally appeared
Philip A. McRae who proved to me on the basis of satisfactory evidence to be the
person whose name is subscribed to the within instrument and acknowledged to me
that he executed the same in his authorized capacity, and that by his signature
on the instrument the person, or the entity upon behalf of which the person
acted, executed the instrument.

 

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

 

WITNESS my hand and official seal.

 

Signature/s/  Kay Street      (Seal)

Sharon K. Street

Notary Public State of Texas

Comm. Expires: 12-04-2021

Notary ID 1901703

 

 

JOINDER BY AND AGREEMENT OF NEW INDEMNITOR

 

LODGING FUND REIT III, INC., a Maryland corporation ("REIT"), and LODGING FUND
REIT III OP, LP, a Delaware limited partnership ("Fee Borrower Member", together
with REIT, collectively, "New Indemnitor"), the New Indemnitor referred to in
the Agreement to which this New Indemnitor Joinder is attached,  intending to be
legally bound and assume the obligations under the Guaranty and the
Environmental Indemnity pursuant to the provisions of this New Indemnitor
Joinder, jointly and severally represents and warrants to and acknowledges and
agrees with Lender the following:

 

          Defined Terms.  All capitalized terms used in this New Indemnitor
Joinder, unless defined below, shall have the meanings given such terms in the
Agreement, and if not defined therein, then in the Original Indemnitor Joinder
attached thereto.

           Benefit to New Indemnitor.  Each New Indemnitor, owning a direct
and/or indirect interest in New Borrower as a result of the Requested Actions,
shall receive a substantial benefit from Lender's consent to the Requested
Actions.

           Assumption by New Indemnitor of Guaranty.  New Indemnitor, jointly
and severally, assumes and agrees to be liable and responsible for and bound by,
from and after the Effective Date, all of Original Indemnitor's obligations,
agreements and liabilities, including but not limited to the jury waiver and
other waivers set forth therein, under the Guaranty, as amended by this New
Indemnitor Joinder, as fully and completely as if the New Indemnitor had
originally executed and delivered such Guaranty as amended by this New
Indemnitor Joinder, as the guarantor/indemnitor thereunder.  New Indemnitor
further agrees to pay, perform and discharge each and every obligation of
payment and performance of any guarantor/indemnitor under, pursuant to and as
set forth in the Guaranty, as amended by this New Indemnitor Joinder, at the
time, in the manner and otherwise in all respects as therein provided.
Notwithstanding the foregoing, with respect to the environmental obligations
under Section 1.1 of the Guaranty, as it relates to the Borrower's Recourse
Environmental Obligation, the liability of New Indemnitor shall be joint and
several with that of New Borrower and, if applicable, Original Borrower and
Original Indemnitor and shall not be limited to environmental obligations
occurring from and after the Effective Date.  From and after the Effective Date,
the Guaranty is amended to provide that all references to the term "Borrower"
used in the Guaranty shall mean and refer to New Borrower and the term
"Guarantor" used in the Guaranty shall mean and refer to New Indemnitor.

           Assumption by New Indemnitor of Environmental Indemnity.  New
Indemnitor, jointly and severally, by this New Indemnitor Joinder assumes and
agrees to be liable and responsible for and bound by all of the Original
Indemnitor's obligations, agreements and liabilities, including but not limited
to the jury waiver and other waivers set forth therein, under the Environmental
Indemnity as fully and completely as if New Indemnitor had signed such
Environmental Indemnity, as amended by this New Indemnitor Joinder, as the
indemnitor/guarantor thereunder, including without limitation, all of those
obligations, agreements and liabilities which would have been the obligations,
agreements and liabilities of Original Indemnitor, without regard to when such
obligations, agreements and liabilities arise, accrue or have arisen or accrued
and without regard to the Original Indemnitor's responsibility therefore, if
any.  New Indemnitor further agrees to pay, perform, and discharge each and
every obligation of payment and performance of any guarantor/indemnitor under,
pursuant to and as set forth in the Environmental Indemnity, as amended by this
New Indemnitor Joinder, at the time, in the manner

 

and otherwise in all respects as therein provided.   The liability of New
Indemnitor under this paragraph shall be joint and several with that of New
Borrower and, if applicable, Original Borrower and Original Indemnitor.  From
and after the Effective Date, the Environmental Indemnity is amended to provide
that all references to the term "Borrower" used in the Environmental Indemnity
shall mean and refer to the New Borrower and the term "Indemnitor" used in the
Environmental Indemnity shall mean and refer to the New Indemnitor.

           Confirmation of Representations; Additional Representations.  New
Indemnitor confirms (a) the representations and warranties and agrees to the
covenants regarding New Indemnitor set forth in the Agreement, including, but
not limited to, obligations to pay the Indemnifications Costs and (b) the truth
and accuracy of all representations and warranties set forth in the Guaranty and
Environmental Indemnity, as applicable.  New Indemnitor represents and warrants
that New Indemnitor received copies of the Guaranty and the Environmental
Indemnity from Original Indemnitor, which copies were warranted by Original
Indemnitor as being true and complete copies of such documents.

           Authority Representations by New Indemnitor.

The execution and delivery of this New Indemnitor Joinder, and performance by
New Indemnitor under the New Indemnitor Joinder, the Guaranty and the
Environmental Indemnity will not (a) violate any provision of any law, rule,
regulation, order, writ, judgment, injunction, decree, determination or award
presently in effect having applicability to New Indemnitor or (b) result in a
breach of or constitute or cause a default under any indenture, agreement, lease
or instrument to which New Indemnitor is a party or by which the Property may be
bound or affected.

REIT is a duly organized, validly existing corporation in good standing under
the laws of the State of Delaware and is qualified to transact business in the
State of Texas.  Katie Cox, as Chief Financial Officer of REIT, acting alone
without the joinder of any other officer, director or shareholder of REIT or any
other party, has the power and authority to execute this New Indemnitor Joinder
on behalf of and to duly bind REIT.

Fee Borrower Member is a duly organized, validly existing limited partnership in
good standing under the laws of the State of Delaware and is qualified to
transact business in the State of Texas.  REIT, as the general partner of Fee
Borrower Member, acting alone without the joinder of any other partner of Fee
Borrower Member or any other person has the power and authority to execute this
New Indemnitor Joinder on behalf of and to duly bind Fee Borrower Member. Katie
Cox, as Chief Financial Officer of REIT, acting alone without the joinder of any
other officer, director or shareholder of REIT or any other party, has the power
and authority to execute this New Indemnitor Joinder on behalf of and to duly
bind REIT and Fee Borrower Member.

 

           Notices to New Indemnitor.  Lender shall deliver any notices to New
Indemnitor which are required to be delivered pursuant to the Guaranty and the
Environmental Indemnity, or are otherwise delivered by the Lender thereunder at
Lender's sole discretion, to New Indemnitor at the following address:

 

LODGING FUND REIT III, INC.

 

LODGING FUND REIT III OP, LP

 

 

 

 

1635 43rd Street South, Suite 205

 

Fargo, North Dakota  58103

 

Attn: Sam Montgomery

 

 

 

 

 

With copy to:

 

 

 

McShane & Bowie, P.L.C.

 

99 Monroe Avenue NW, Suite 1100

 

Grand Rapids, Michigan  49503

 

Attn:  John Faris, Esq.

 

 

 

All notices to be sent by New Indemnitor to Lender under the Guaranty, the
Environmental Indemnity and Loan Documents shall be sent to Lender in the manner
set forth in and at the address shown in Section 4.6 of the Agreement.

           Joint and Several Liability.  If New Indemnitor consists of more
than one person or party, the obligations and liabilities of each such person or
party shall be joint and several.

           Governing Law.  This New Indemnitor Joinder shall be interpreted,
construed, and enforced in accordance with the governing law provisions of the
Guaranty and the Environmental Indemnity, as applicable.

 

(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)

 

 

New Indemnitor has executed and delivered this New Indemnitor Joinder to be
effective as of the Effective Date of the Agreement.

 

 

 

 

 

Witnesses:

NEW INDEMNITOR:

 

 

 

 

LODGING FUND REIT III, INC.,

 

a Maryland corporation

 

 

 

/s/ Mitch Bossert

By:

/s/ Katie Cox

Print Name:

Mitch Bossert

Name:

Katie Cox

 

 

Title:

Chief Financial Officer

 

 

 

 

 

 

 

 

/s/ Angie Stock

 

 

Print Name:

Angie Stock

 

 

 

 

 

 

 

 

 

 

STATE OF NORTH DAKOTA

)

 

 

 

)

 

 

COUNTY OF CASS

)

 

 

 

On December 26 , 2019, before me, Jennifer Moum , personally appeared Katie Cox
who proved to me on the basis of satisfactory evidence to be the person whose
name is subscribed to the within instrument and acknowledged to me that he
executed the same in his authorized capacity, and that by his signature on the
instrument the person, or the entity upon behalf of which the person acted,
executed the instrument.

 

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

 

WITNESS my hand and official seal.

 

Signature /s/  Jennifer Moum  (Seal)

Jennifer Moum

Notary Public

State of North Dakota

My Commission Expires April 25, 2022

 

 

 

 

 

 

Witnesses:

NEW INDEMNITOR:

 

 

 

LODGING FUND REIT III OP, LP,

 

a Delaware limited partnership

 

 

 

By:

Lodging Fund REIT III, Inc.,

 

 

a Maryland corporation,

 

 

as general partner

 

 

/s/ Mitch Bossert

By:

/s/ Katie Cox

Print Name:

Mitch Bossert

Name:

Katie Cox

 

Title:

Chief Financial Officer

 

 

 

 

/s/ Angie Stock

 

Print Name:

Angie Stock

 

 

 

 

STATE OF NORTH DAKOTA

)

 

 

)

 

COUNTY OF CASS

)

 

 

On December 26 , 2019, before me, Jennifer Moum , personally appeared Katie Cox
who proved to me on the basis of satisfactory evidence to be the person whose
name is subscribed to the within instrument and acknowledged to me that he
executed the same in his authorized capacity, and that by his signature on the
instrument the person, or the entity upon behalf of which the person acted,
executed the instrument.

 

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

 

WITNESS my hand and official seal.

 

Signature /s/  Jennifer Moum  (Seal)

Jennifer Moum

Notary Public

State of North Dakota

My Commission Expires April 25, 2022