exv10w1






Exhibit 10.1




 





LOAN AGREEMENT




Dated as of October 28, 2009




among




INTERSTATE ATLANTA AIRPORT, LLC,




as Borrower,




PB CAPITAL CORPORATION,




together with its successors and assigns,




as Lenders,




and




PB CAPITAL CORPORATION,




as Agent for Lenders
 
 






 









 








TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	SECTION 1.1.    Definitions
	 	 	1	 
	SECTION 1.2.    Other Definitional Provisions
	 	 	23	 
	 
	 	 	 	 
	ARTICLE II THE LOAN
	 	 	24	 
	SECTION 2.1.    The Loan; Use of Funds
	 	 	24	 
	SECTION 2.2.    Interest
	 	 	24	 
	SECTION 2.3.    Determination of Applicable Interest Rate
	 	 	25	 
	SECTION 2.4.    Principal Payments
	 	 	26	 
	SECTION 2.5.    Payment; Default Rate; Application of Certain Monies;
Priority of Payments; Set-offs
	 	 	28	 
	SECTION 2.6.    Interest Rate Protection Agreement
	 	 	29	 
	SECTION 2.7.    Additional Interest
	 	 	32	 
	SECTION 2.8.    No Withholdings
	 	 	32	 
	SECTION 2.9.    Unavailability of LIBOR; Illegality
	 	 	33	 
	SECTION 2.10.    Increased Costs and Capital Adequacy
	 	 	34	 
	SECTION 2.11.    Usury
	 	 	35	 
	SECTION 2.12.    Closing
	 	 	35	 
	SECTION 2.13.    Fees
	 	 	35	 
	SECTION 2.14.    Clearing Account and Lockbox Account
	 	 	35	 
	SECTION 2.15.    Tenant Security Account
	 	 	37	 
	SECTION 2.16.    FF&E Reserve Account
	 	 	38	 
	SECTION 2.17.    Return of Funds in Accounts
	 	 	39	 
	SECTION 2.18.    Fees
	 	 	39	 
	SECTION 2.19.    Changes in Law Regarding Taxation of Property
	 	 	39	 
	 
	 	 	 	 
	ARTICLE III CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF THIS LOAN AGREEMENT
	 	 	40	 
	SECTION 3.1.    Representations and Warranties
	 	 	40	 
	SECTION 3.2.    Receipt of Items and Documents by Agent
	 	 	40	 
	SECTION 3.3.    Closing Documents, Etc.
	 	 	42	 
	SECTION 3.4.    Payment of Fees and Expenses
	 	 	42	 
	SECTION 3.5.    Adverse Conditions; Internal Approval
	 	 	42	 
	 
	 	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES
	 	 	42	 
	SECTION 4.1.    Due Organization
	 	 	42	 
	SECTION 4.2.    Due Execution
	 	 	42	 
	SECTION 4.3.    Enforceability
	 	 	43	 
	SECTION 4.4.    No Violation
	 	 	43	 
	SECTION 4.5.    No Litigation
	 	 	43	 
	SECTION 4.6.    No Default or Event of Default
	 	 	43	 
	SECTION 4.7.    Offsets, Defenses, Etc.
	 	 	43	 
	SECTION 4.8.    Consents
	 	 	43	 






i









 






	 	 	 	 	 
	 	 	Page	 
	SECTION 4.9.    Financial Statements and Other Information
	 	 	44	 
	SECTION 4.10.    Full Disclosure
	 	 	44	 
	SECTION 4.11.    Accounts
	 	 	44	 
	SECTION 4.12.    Indebtedness
	 	 	44	 
	SECTION 4.13.    Insurance Policies
	 	 	44	 
	SECTION 4.14.    Availability of Utilities and Access
	 	 	44	 
	SECTION 4.15.    No Liens
	 	 	45	 
	SECTION 4.16.    Compliance with Legal Requirements
	 	 	45	 
	SECTION 4.17.    Certain Agreements
	 	 	45	 
	SECTION 4.18.    Security Documents
	 	 	46	 
	SECTION 4.19.    Casualty and Taking
	 	 	46	 
	SECTION 4.20.    Brokerage
	 	 	46	 
	SECTION 4.21.    Encroachments
	 	 	46	 
	SECTION 4.22.    Foreign Person
	 	 	46	 
	SECTION 4.23.    Control Person
	 	 	46	 
	SECTION 4.24.    Government Regulation
	 	 	47	 
	SECTION 4.25.    ERISA
	 	 	47	 
	SECTION 4.26.    Labor Relations
	 	 	47	 
	SECTION 4.27.    Name; Principal Place of Business
	 	 	47	 
	SECTION 4.28.    Intellectual Property
	 	 	47	 
	SECTION 4.29.    Flood Zone
	 	 	48	 
	SECTION 4.30.    Condition of Property
	 	 	48	 
	SECTION 4.31.    Taxes
	 	 	48	 
	SECTION 4.32.    Adverse Contracts
	 	 	48	 
	SECTION 4.33.    Adverse Claims
	 	 	49	 
	SECTION 4.34.    Creditworthiness
	 	 	49	 
	SECTION 4.35.    Patriot Act
	 	 	49	 
	SECTION 4.36.    Leases
	 	 	49	 
	SECTION 4.37.    Special Purpose Entity
	 	 	50	 
	SECTION 4.38.    Solvency
	 	 	50	 
	 
	 	 	 	 
	ARTICLE V GENERAL AND OPERATIONAL COVENANTS
	 	 	50	 
	SECTION 5.1.    Financial Statements, Reports and Documents of Borrower
	 	 	50	 
	SECTION 5.2.    Marketing, Management, Maintenance and Repairs
	 	 	55	 
	SECTION 5.3.    Inspection of Premises and Books and Records
	 	 	57	 
	SECTION 5.4.    Compliance with Legal, Insurance and Contractual
Requirements
	 	 	58	 
	SECTION 5.5.    Appraisals
	 	 	59	 
	SECTION 5.6.    Payment of Impositions
	 	 	59	 
	SECTION 5.7.    Liens and Encumbrances; Ownership of Collateral
	 	 	59	 
	SECTION 5.8.    Permitted Contests
	 	 	59	 






ii









 






	 	 	 	 	 
	 	 	Page	 
	SECTION 5.9.    Alterations
	 	 	60	 
	SECTION 5.10.    Leases
	 	 	61	 
	SECTION 5.11.    Required Insurance
	 	 	63	 
	SECTION 5.12.    Damage or Destruction
	 	 	65	 
	SECTION 5.13.    Taking of the Mortgaged Property
	 	 	69	 
	SECTION 5.14.    Application of Proceeds of Casualty or Taking to Loan;
Loan Repayment
	 	 	70	 
	SECTION 5.15.    Costs and Expenses
	 	 	70	 
	SECTION 5.16.    Transfers
	 	 	71	 
	SECTION 5.17.    Defense of Title
	 	 	75	 
	SECTION 5.18.    Recordation and Certain Taxes
	 	 	75	 
	SECTION 5.19.    Name, Fiscal Year and Accounting Method
	 	 	76	 
	SECTION 5.20.    Consolidation, Merger, Conveyance, Transfer or Lease

	 	 	76	 
	SECTION 5.21.    Organization Restrictions
	 	 	76	 
	SECTION 5.22.    Changes in Zoning
	 	 	76	 
	SECTION 5.23.    Limitation on Indebtedness
	 	 	76	 
	SECTION 5.24.    Distributions, Dividends and Affiliate Payments

	 	 	76	 
	SECTION 5.25.    ERISA
	 	 	77	 
	SECTION 5.26.    Maintenance of Existence
	 	 	77	 
	SECTION 5.27.    Subsidiaries and Joint Ventures
	 	 	77	 
	SECTION 5.28.    Loans to Members, Etc.
	 	 	77	 
	SECTION 5.29.    Transactions with Affiliates
	 	 	77	 
	SECTION 5.30.    Adverse Contracts
	 	 	77	 
	SECTION 5.31.    Utilities
	 	 	78	 
	SECTION 5.32.    Margin Stock
	 	 	78	 
	SECTION 5.33.    Patriot Act Compliance
	 	 	78	 
	 
	 	 	 	 
	ARTICLE VI EVENTS OF DEFAULT
	 	 	78	 
	SECTION 6.1.    Events of Default
	 	 	78	 
	SECTION 6.2.    Acceleration of Loan
	 	 	81	 
	SECTION 6.3.    Rights and Remedies Generally
	 	 	81	 
	SECTION 6.4.    Agent’s Right to Operate; Sums Advanced
	 	 	82	 
	SECTION 6.5.    Assignment of Funds
	 	 	83	 
	SECTION 6.6.    Accounts
	 	 	83	 
	SECTION 6.7.    No Liability of Agent or Lenders
	 	 	84	 
	SECTION 6.8.    Management Agreement and Affiliate Agreements
	 	 	84	 
	SECTION 6.9.    Right of Offset
	 	 	85	 
	SECTION 6.10.    Termination of Loan Agreement
	 	 	85	 
	SECTION 6.11.    Right to Perform
	 	 	85	 
	 
	 	 	 	 
	ARTICLE VII ASSIGNMENTS AND PARTICIPATIONS
	 	 	86	 
	SECTION 7.1.    Assignment and Participations
	 	 	86	 






iii









 







	 	 	 	 	 
	 	 	Page	 
	SECTION 7.2.    Participation
	 	 	86	 
	SECTION 7.3.    Availability of Records
	 	 	87	 
	SECTION 7.4.    Borrower’s Facilitation of Transfer
	 	 	87	 
	SECTION 7.5.    Notice; Registration Requirement
	 	 	88	 
	SECTION 7.6.    Registry
	 	 	88	 
	SECTION 7.7.    Disclosure by Agent or Lender
	 	 	89	 
	SECTION 7.8.    Interest Rate Protection Agreements
	 	 	89	 
	 
	 	 	 	 
	ARTICLE VIII AGENT AND LENDERS
	 	 	89	 
	SECTION 8.1.    Scope of Article XIII
	 	 	89	 
	SECTION 8.2.    Agent
	 	 	89	 
	SECTION 8.3.    Distributions
	 	 	90	 
	SECTION 8.4.    Authority, No Reliance; Binding Effect
	 	 	91	 
	SECTION 8.5.    Loan
	 	 	91	 
	SECTION 8.6.    Equitable Adjustments
	 	 	93	 
	SECTION 8.7.    Other Transactions
	 	 	93	 
	SECTION 8.8.    Obligations Absolute
	 	 	93	 
	SECTION 8.9.    Indemnification
	 	 	93	 
	SECTION 8.10.    Taxes
	 	 	94	 
	SECTION 8.11.    Return of Payments
	 	 	94	 
	SECTION 8.12.    No Partnership
	 	 	95	 
	SECTION 8.13.    Resignation and Removal of Agent; Successor Agent

	 	 	95	 
	SECTION 8.14.    Defaults by any Lender
	 	 	95	 
	SECTION 8.15.    Purchase Price; Payment for Defaulting Lender’s Pro Rata
Share
	 	 	97	 
	 
	 	 	 	 
	ARTICLE IX GENERAL CONDITIONS
	 	 	97	 
	SECTION 9.1.    Indemnity
	 	 	97	 
	SECTION 9.2.    No Waivers
	 	 	99	 
	SECTION 9.3.    Intentionally Omitted
	 	 	99	 
	SECTION 9.4.    Agent and Lenders Sole Beneficiaries
	 	 	100	 
	SECTION 9.5.    Entire Agreement
	 	 	100	 
	SECTION 9.6.    Assignment
	 	 	100	 
	SECTION 9.7.    Further Assurances; Filing of Financing Statements

	 	 	100	 
	SECTION 9.8.    Cumulative Remedies
	 	 	100	 
	SECTION 9.9.    Amendments, Consents, Waivers, Approvals, Etc.
	 	 	100	 
	SECTION 9.10.    Notices
	 	 	101	 
	SECTION 9.11.    Limitation on Liability
	 	 	102	 
	SECTION 9.12.    Waiver of Consequential Damages, Etc
	 	 	103	 
	SECTION 9.13.    Binding Effect
	 	 	103	 
	SECTION 9.14.    Severability of Provisions
	 	 	103	 
	SECTION 9.15.    Governing Law and Consent to Jurisdiction
	 	 	103	 






iv









 







	 	 	 	 	 
	 	 	Page	 
	SECTION 9.16.    Waiver of Jury Trial
	 	 	103	 
	SECTION 9.17.    No Joint Venture
	 	 	103	 
	SECTION 9.18.    Determinations and Consents of Agent
	 	 	104	 
	SECTION 9.19.    Reliance by Agent on Action on Behalf of Borrower

	 	 	104	 
	SECTION 9.20.    Headings, Etc.
	 	 	104	 
	SECTION 9.21.    Incorporation by Reference
	 	 	104	 
	SECTION 9.22.    Counterparts
	 	 	104	 
	SECTION 9.23.    Attorneys’ Fees
	 	 	104	 
	SECTION 9.24.    Employer Identification Number, Etc
	 	 	104	 







v









 








Exhibits and Schedules




	 	 	 
	Exhibit A:

	 	The Land
	Exhibit B-1:

	 	Form of Account Agreement (Springing)
	Exhibit B-2:

	 	Form of Account Agreement (Blocked)
	Exhibit B-3:

	 	Form of Account Agreement (Clearing Account)
	Exhibit C:

	 	Environmental Report and Engineering Report
	Exhibit D:

	 	Definition of Special Purpose Bankruptcy Remote Entity
	Exhibit E:

	 	Form of Credit Card Servicer Agreement
	 
	 	 
	Schedule 2.6(a):

	 	Interest Rate Protection Agreement Assignment/Consent
	Schedule 4.5:

	 	Disclosed Litigation
	Schedule 4.11:

	 	Accounts
	Schedule 4.17:

	 	Material Operating Agreements
	Schedule 5.1(d):

	 	Form of Quarterly Certificate
	Schedule 5.11:

	 	Insurance Policies
	Schedule 8.5:

	 	Assignment and Acceptance







vi









 








LOAN AGREEMENT




          This LOAN AGREEMENT (this “Loan Agreement”) dated as of October 28, 2009, by and among
INTERSTATE ATLANTA AIRPORT, LLC, a Delaware limited liability company, having an office at c/o
Interstate Hotels & Resorts, 4501 North Fairfax Drive, Suite 500, Arlington, Virginia 22203
(“Borrower”), PB CAPITAL CORPORATION, a Delaware corporation, having an office at 230 Park
Avenue, New York, New York 10169, in its capacity as agent for Lenders (together with its
successors and assigns in such capacity as agent for Lenders, “Agent”), and the LENDERS
party hereto from time to time (together with their successors and assigns in such capacity as a
lender, including any Assignees (as hereinafter defined) hereunder, each a “Lender” and
collectively “Lenders”).




W I T N E S S E T H:




          WHEREAS, Borrower is the owner of certain real property located in College Park, Georgia,
which property is more particularly described in Exhibit A attached hereto (the
“Land”), together with the improvements now or hereafter located thereon; and




          WHEREAS, Borrower wishes to borrow $22,000,000 (the “Loan Amount”) from Lenders in
connection with the ownership and operation of the Premises (as defined in Section 1.1
hereof) upon the terms and conditions contained herein.




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




ARTICLE I




DEFINITIONS




          SECTION 1.1.    Definitions. For purposes of this Loan Agreement, the following terms shall have
the respective meanings set forth in this Article I:




          “Account Agreement” means an agreement substantially in the form attached hereto as
Exhibit B-3 with respect to the Clearing Account, Exhibit B-2 with respect to the
Operating Account, the FF&E Reserve Account and Tenant Security Account, and Exhibit B-1 in
the case of the case of all other Accounts not specified in this definition (other than the Lockbox
Account and the other Accounts established under the Cash Management Agreement), or such other
forms of agreements similar in substance and acceptable to Agent, to be executed and delivered by
Borrower, Agent and the bank at which the Account that is the subject of such agreement is held.
Exhibit B-2 shall apply for any Account Agreement required for the GM Account pursuant to
Section 2.14(c) hereof.




          “Accounts” means, collectively, all accounts of Borrower and all accounts of any
Person held on behalf of or for the benefit of Borrower, including the Clearing Account, the
Lockbox Account, the Operating Account, the FF&E Reserve Account, the GM Account and the Tenant
Security Account.




 









 








          “Additional Interest” means (a) all sums payable pursuant to Sections 2.7,
2.8 and 2.10 hereof and (b) all sums payable to Agent or its Affiliate pursuant to
a Lender Interest Rate Protection Agreement, if any.




          “Affiliate” means, with respect to any specified Person, any other Person:





     (a) which directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, such Person; or




     (b) which, directly or indirectly, beneficially owns or holds twenty-five
percent (25%) or more of any class of stock or any other ownership interest in such
Person; or




     (c) twenty-five percent (25%) or more of the direct or indirect ownership of
which is beneficially owned or held by such Person; or




     (d) which is a member of the family (as defined in Section 267(c)(4) of the
IRC) of such Person or which is a trust or estate, the beneficial owners of which
are members of the family (as defined in Section 267(c)(4) of the IRC) of such
Person; or




     (e) which directly or indirectly is a general partner, controlling shareholder,
managing member, non-member manager, officer, director or employee of such Person.



          For purposes of this definition, (i) the term “control” (and its correlative meanings) means
the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of stock, by contract or
otherwise, and (ii) Borrower and Guarantor shall be deemed to be Affiliates of Borrower and each
other.




          “Agent” has the meaning set forth in the first paragraph of this Loan Agreement.




          “Agent’s Counsel” means such counsel as Agent from time to time may engage on behalf
of itself and/or Lenders.




          “Agent’s Counsel Fees” means the reasonable fees and disbursements of Agent’s Counsel
for services heretofore or hereafter rendered to Agent on behalf of itself and/or Lenders in
connection with the Loan, including the preparation, negotiation, administration and modification
of the Loan Documents and the enforcement of Agent’s and Lenders’ rights and remedies under the
Loan Documents.




          “Amortization Commencement Date” means the Payment Date occurring in November, 2011.




          “Applicable Interest Rate” has the meaning set forth in Section 2.2(a) hereof.




2









 





          “Appraisal” means a written appraisal report of the Premises as the term “appraisal”
is defined in the Code of Professional Ethics of the Appraisal Institute, meeting the requirements
of the Financial Institutions Reform, Recovery and Enforcement Act of 1989, prepared by a
professional appraiser retained by Agent at Borrower’s expense (except as otherwise provided
herein) who is a member of the Appraisal Institute, addressed to Agent and in form, scope and
substance satisfactory to Agent, setting forth such appraiser’s determination of the Appraised
Value.




          “Appraisal Update” means any written supplement or “update” to an Appraisal, prepared
by a professional appraiser retained by Agent at Borrower’s expense (except as otherwise provided
herein) who is a member of the Appraisal Institute, addressed to Agent and in form, scope and
substance satisfactory to Agent, setting forth such appraiser’s determination of the Appraised
Value.




          “Appraised Value” means the fair market value of the Premises, which would be obtained
in an arm’s length transaction between an informed and willing buyer and an informed and willing
seller, under no compulsion, respectively, to buy or sell, on the appraisal date of the Appraisal
or Appraisal Update, as applicable.




          “Approved Capital Budget” means a capital and FF&E budget reasonably approved by Agent
to the extent required by and in accordance with Section 5.1(f) hereof, or which is
otherwise applicable in any calendar year pursuant to said Section, with such modifications
of such budget reasonably approved by Agent.




          “Approved Capital Expenditures” means, for any fiscal year of Borrower, the Capital
Expenditures set forth in the Approved Capital Budget for such fiscal year that are actually
incurred by Borrower during such fiscal year, excluding the amounts set forth in
clauses (a) through (c) of the definition of “Approved Operating Expenses”
set forth in this Section 1.1.




          “Approved FF&E Expenditures” means, for any fiscal year of Borrower, the FF&E
Expenditures set forth in the Approved Capital Budget for such fiscal year that are actually
incurred by Borrower during such fiscal year, excluding the amounts set forth in
clauses (a) through (c) of the definition of “Approved Operating Expenses”
set forth in this Section 1.1.




          “Approved Operating Budget” means an operating budget reasonably approved by Agent to
the extent required by and in accordance with Section 5.1(f) hereof, or which is otherwise
applicable in any calendar year pursuant to said Section, with such modifications of such
budget reasonably approved by Agent.




          “Approved Operating Expenses” means Operating Expenses actually and reasonably
incurred or to be incurred by or on behalf of Borrower in accordance with the applicable Approved
Operating Budget, as determined on a cash basis, excluding (a) amounts paid in
contravention of the terms of the Loan Agreement or any other Loan Document, or on account of or in
connection with any agreement made or other action taken in contravention of the terms of the Loan
Agreement or any other Loan Document, (b) any amount paid from any reserve account under any Loan
Document (including any reserve account or subaccount under the Cash Management Agreement) or any
reserve of Borrower or the Premises to the extent



3









 






payment to such reserve previously constituted an expense, (c) amounts funded from Loan
proceeds, insurance proceeds or condemnation proceeds, (d) Capital Expenditures and FF&E
Expenditures, (e) non-cash items, including depreciation and amortization of building improvements,
furniture and equipment, tenant improvement costs, leasing expenses and debt procurement costs and
(f) federal and state income taxes, franchise taxes or other taxes based on income or gross
receipts due and owing from Borrower.




          “Assignee” has the meaning set forth in Section 7.1 hereof.




          “Assignment and Acceptance” has the meaning set forth in Section 7.5 hereof.




          “Assignment of Agreements” means that certain Assignment of Agreements dated as of the
Closing Date made by Borrower in favor of Agent and Lenders.




          “Assignment of Interest Rate Protection Agreement” means an Assignment of Interest
Rate Protection Agreement made by Borrower in favor of Agent and Lenders in the form attached
hereto as Schedule 2.6(a).




          “Assignment of Leases and Rents” means that certain Assignment of Leases and Rents
dated as of the Closing Date made by Borrower in favor of Agent and Lenders.




          “Base Rate” means, as of any date of determination, a per annum interest rate
determined by Agent (which determination shall be conclusive absent manifest error) to be equal to
the sum of the Base Rate Margin plus the higher of (a) two percent (2.0%) or (b) the higher of (i)
either (A) the rate per annum listed in the “Money Rates” section of The Wall Street Journal (or
any successor publication) as the “Prime Rate”, or (B) if The Wall Street Journal ceases
publication of such rate, then the so-called “prime rate” or “base rate” as announced by Citibank
N.A., or its successor from time to time, or, (C) if the foregoing rate in clause (B) is not
published or available, then the so-called “prime rate” or “base rate” announced by J.P. Morgan
Chase & Co. or its bank subsidiary, or (D) if the foregoing rate in clause (C) is unavailable,
then, a rate selected by Agent in its reasonable judgment as most nearly approximating the rate in
clause (C), which Agent may elect to be the prime commercial lending rate established by Agent’s
principal office in New York, New York from time to time as its “prime rate” or “base rate” (which
Borrower acknowledges is not necessarily Agent’s lowest rate), or (ii) the Federal Funds Rate plus
one-half of one percent (0.50%) per annum. Notwithstanding the foregoing, however, the Base Rate
shall not be less than the highest LIBOR Rate for any LIBOR Rate Period then available to Borrower
as set forth in the definition of “LIBOR Rate” in this Section 1.1 and subject to
Section 2.3(f) hereof, assuming such LIBOR Rate and LIBOR Rate Period was applicable to the
Loan instead of the Base Rate.




          “Base Rate Margin” means five percent (5.0%) per annum.




          “Borrower” has the meaning set forth in the first paragraph of this Loan Agreement.




          “Borrower Operating Agreement” means that certain Amended and Restated Limited
Liability Company Agreement of Interstate Atlanta Airport, LLC dated as October 28, 2009.




4









 








          “Borrower’s Certificate” means that certain Certificate by Borrower in favor of Agent
dated as of the Closing Date.




          “Broker” has the meaning set forth in Section 4.20 hereof.




          “Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York are authorized or required by law, governmental decree or
executive order to close.




          “Calendar Quarter” means each of the periods of January 1 through the immediately
succeeding March 31, April 1 through the immediately succeeding June 30, July 1 through the
immediately succeeding September 30, and October 1 through the immediately succeeding December 31.




          “Capital Expenditures” means expenditures for repairs, replacements or improvements of
or to the Premises the cost of which would be capitalized under GAAP. “Capital
Expenditures” does not include FF&E Expenditures.




          “Cash Management Agreement” means that certain Cash Management Agreement dated as of
the date hereof among Borrower, Agent and Depositary.




          “Cash Sweep Condition” shall exist if (a) the Debt Service Coverage Ratio for any
Calendar Quarter is less than the Minimum Debt Service Coverage Ratio (in which event the Cash
Sweep Condition shall commence to exist as of the date that the financial statements required to be
delivered with respect to such Calendar Quarter pursuant to Sections 5.1(b) and (d)
hereof are delivered to Agent) or (b) Borrower fails to deliver to Agent the financial statements
required to be delivered with respect to any Calendar Quarter pursuant to Sections 5.1(b)
and (d) hereof by the date required pursuant to said Sections 5.1(b) and
(d) (in which event the Cash Sweep Condition shall commence to exist as of the required
delivery date pursuant to said Sections 5.1(b) and (d)). If a Cash Sweep Condition
exists pursuant to the preceding clause (a), a Cash Sweep Condition shall continue to exist
until two (2) consecutive Calendar Quarters shall have elapsed with respect to which the Debt
Service Coverage Ratio for each such Calendar Quarters was equal to or greater than the Minimum
Debt Service Coverage Ratio, and no Cash Sweep Condition exists pursuant to the preceding
clause (b) (in which event the effective date of the termination of the Cash Sweep
Condition shall be the date that Borrower shall have delivered to Agent the financial statements
required to be delivered with respect to such second (2nd) consecutive Calendar Quarter
pursuant to Sections 5.1(b) and (d) hereof). If a Cash Sweep Condition exists
pursuant to the preceding clause (b), a Cash Sweep Condition shall continue to exist until
the date that the financial statements required to have been delivered to Agent as aforesaid are
delivered to Agent, and no Cash Sweep Condition exists or is deemed to exist pursuant to the
preceding clause (a).




          “Casualty” means damage or destruction to all or any part of the Mortgaged Property.




          “Casualty Proceeds Disbursement Threshold” has the meaning set forth in
Section 5.12(b) hereof.




5









 








          “Central Bank Pledge” has the meaning set forth in Section 7.1 hereof.




          “Clearing Account” means an account with a bank or other financial institution
selected by Borrower and reasonably acceptable to Agent. The Clearing Account as of the Closing
Date is set forth in Schedule 4.11 attached hereto.




          “Closing” means the execution and delivery of this Loan Agreement by Borrower, Agent
and Lenders.




          “Closing Date” means the date upon which the Closing occurs.




          “Collateral” means the Mortgaged Property and all other property, real or personal,
tangible or intangible, and all rights thereto, now or hereafter pledged, mortgaged, assigned or
delivered pursuant or with respect to the Loan Documents or otherwise by Borrower or any other
Person to Agent and/or Lenders as security for the Obligations.




          “Commitment” means, (a) as to any Lender, the commitment of such Lender to make its
Pro Rata Share of the Loan, in an amount as of the Closing Date equal to the amount set forth below
its signature on the signature pages attached hereto, and hereafter, as such commitment shall be
set forth in any Assignment and Acceptance by which such Lender becomes a Lender and/or by which
such Lender assigns all or any portion of its rights and/or obligations in and to the Loan and the
other Loan Documents to an Assignee, and (b) as to all Lenders, the aggregate commitment of all
Lenders to make the Loan, in an amount as of the Closing Date equal to the Loan Amount.




          “Comparable Standards” means (a) for so long as the Franchise Agreement is in effect,
the standards of operation, use and maintenance required therein and (b) at any time that the
Franchise Agreement is not in effect, the standards of operation, use and maintenance of hotels
located in within a four (4) mile radius of the Atlanta International Airport that are comparable
to the Premises in location, price, size, facilities, amenities, quality and nature and typical of
a nationally-branded, full service hotel.




          “Condemnation Proceeds Disbursement Threshold” has the meaning set forth in
Section 5.13(b) hereof.




          “Counterparty” means each counterparty to, or issuer of, any Interest Rate Protection
Agreement other than Borrower or an Affiliate of Borrower.




          “Credit Card Servicer Agreement” means an agreement in the form attached hereto as
Exhibit E (or in another form customarily used by the applicable credit card company,
service or agent and reasonably acceptable to Agent) among Borrower and/or Property Manager, as
applicable, Agent and each credit card company, servicer or agency used by Borrower and/or Property
Manager in connection with the Premises, which agreement shall require the deposit of funds into
the Lockbox Account, among other things.




          “Debt Service Coverage Ratio” means with respect to each Calendar Quarter, as of the
last day of such Calendar Quarter, the ratio of (a) Net Operating Income for the twelve




6









 







(12) consecutive calendar month period ending on such date to (b) Implied Debt Service
calculated as of such date.




          “Default” means any event which, with the giving of notice or the passage of time, or
both, would constitute an Event of Default.




          “Default Rate” means, as to any date, the actual Applicable Interest Rate for that
date (determined on a weighted average basis to the extent more than one Applicable Interest Rate
is then in effect), plus five percent (5%) per annum.




          “Defaulting Lender” has the meaning set forth in Section 8.14(a) hereof.




          “Depositary” means a bank or financial institution selected by Borrower and reasonably
acceptable to Agent.




          “Dollars” or the sign “$” means dollars in the lawful currency of the United
States of America.




          “Engineering Report” means, collectively, those certain reports and assessments set
forth on Exhibit C attached hereto under the heading “Engineering Report.”




          “Environmental Indemnity” means that certain Environmental Indemnity dated as of the
Closing Date made by Borrower and Guarantor in favor of Agent and Lenders.




          “Environmental Report” means, collectively, those certain reports and assessments set
forth on Exhibit C attached hereto under the heading “Environmental Report.”




          “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and the
rules and regulations promulgated thereunder by any Governmental Authority, as from time to time in
effect.




          “ERISA Affiliate” means any organization, trade or business, or other arrangement
(whether or not incorporated) which is a member of a group of which Borrower is also a member and
which is treated as a single employer within the meaning of IRC Section 414(b), (c), (m) or (o) or
Section 4001 of ERISA.




          “ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or
the regulations issued thereunder with respect to a Pension Plan (other than an event for which the
30-day notice period is waived); (b) the withdrawal of Borrower or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA, (c) the complete or partial withdrawal of
Borrower or any ERISA Affiliate from any Multiemployer Plan, (d) notice of reorganization or
insolvency of a Multiemployer Plan, (e) the filing of a notice of intent to terminate a Pension
Plan or the treatment of a plan amendment as a termination under Section 4041 of ERISA, (f) the
institution, or threat of institution, of proceedings to terminate or appoint a trustee to
administer a Pension Plan or Multiemployer Plan by the PBGC, (g) the failure to make any required
contribution to a Pension Plan or Multiemployer Plan, (h) the imposition of a lien under IRC
Section 412 or Section 302 of ERISA on Borrower or any ERISA



7









 






Affiliate, (i) the existence with respect to any Pension Plan of an “accumulated funding
deficiency” (as defined in IRC Section 412 or Section 302 of ERISA), whether or not waived, or
(j) any event or condition that might reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan or the imposition of any liability under Title IV of ERISA,
other than for PBGC premiums due but not delinquent under Section 4007 of ERISA.




          “Event of Default” has the meaning set forth in Section 6.1 hereof.




          “Excluded Taxes” means, with respect to any Lender, (a) income, franchise or similar
taxes imposed on (or measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such Lender is organized or in which its principal office is
located or in which its Applicable Lending Office is located, and (b) any branch profits taxes
imposed by the United States of America or any similar law imposed by any other jurisdiction in
which such Lender is organized or in which its principal office is located or in which its
Applicable Lending Office is located.




          “Federal Funds Rate” means, for any period, a fluctuating interest rate per annum
(based on a 360-day year) equal, for each day of such period, to the rate of interest quoted at
11:00 a.m. New York time charged on overnight federal funds transactions with member banks of the
Federal Reserve System.




          “FF&E” has the meaning set forth in the Mortgage.




          “FF&E Expenditures” means expenditures for the repair, replacement or acquisition (as
appropriate) of furniture, fixtures and equipment for the Premises, so long as such repairs,
replacements or acquisitions would be capitalized as an asset for accounting purposes under GAAP.




          “FF&E Reserve Account” means an account with a bank or other financial institution
reasonably acceptable to Agent. The FF&E Reserve Account as of the Closing Date is set forth in
Schedule 4.11 attached hereto.




          “FF&E Reserve Amount” means, for any calendar month, an amount equal to the greater of
(a) three percent (3.0%) of Operating Revenues or (b) the amount required pursuant to the Franchise
Agreement for such calendar month.




          “Franchise Agreement” means that certain Westin Hotel Change of Ownership License
Agreement dated as of May 24, 2007 between Borrower and Franchisor, as amended by that certain
First Amendment to License Agreement dated September 19, 2008, and as further amended by that
certain Second Amendment to License Agreement dated September 19, 2009, together with such
modifications as shall be consented to by Agent in accordance with this Loan Agreement.




          “Franchisor” means Westin Hotel Management, L.P., a Delaware limited partnership, and,
subject to Section 5.2 hereof with respect to assignments which require Borrower’s consent
pursuant to the Franchise Agreement, its successors and assigns under the Franchise Agreement or
any other franchisor acceptable to Agent.




8









 








          “Franchisor Comfort Letter” means that certain letter agreement dated as of the
Closing Date among Borrower, Franchisor and Agent.




          “Funding Direction Statement” shall mean that certain Funding Statement dated as of
the Closing Date executed by Borrower.




          “Full Recourse Event” means, collectively, any or all of the following:





     (a) fraud or willful misconduct on the part of Borrower or Guarantor or any of
their respective principals, directors, officers, agents or employees (i) in the
inducement of the Loan, Agent’s or Lenders’ entering into, granting or accepting any
Loan Document or any amendment, modification or waiver of any term thereof, Agent’s
or Lenders’ waiving any Default or Event of Default or Agent’s or Lenders’
forbearing from exercising their rights and remedies or (ii) that has a Material
Adverse Effect;




     (b) any Transfer in contravention of this Loan Agreement or any other Loan
Document;




     (c) the incurrence by Borrower of any Indebtedness, whether secured or
unsecured, in contravention of this Loan Agreement or any other Loan Document; and




     (d) (i) the occurrence of an Event of Default pursuant to clause (i) of
Section 6.1 hereof with respect to Borrower or (ii) the occurrence of a
Default or an Event of Default pursuant to clause (j) of Section 6.1
hereof with respect to Borrower as a result of a collusive action taken by Borrower
or any Affiliate of Borrower or any of their respective principals, directors,
officers, agents or employees, individually or in collusion with another Person, or
as a result of the failure of Borrower to contest or otherwise seek dismissal of any
proceeding or petition with respect to Borrower referred to therein.



          “GAAP” means those generally accepted accounting principles and practices which are
recognized as such by the American Institute of Certified Public Accountants or by the Financial
Accounting Standards Board or through appropriate boards or committees of that Board from and after
the Closing Date, as amended or changed from time to time by the American Institute of Certified
Public Accountants or the Financial Accounting Standards Board (or other appropriate board or
committee of that Board), and which are consistently applied for all periods, so as to properly
reflect the financial position of a Person. Borrower shall promptly notify Agent of all such
amendments and other changes in such principles and/or practices that are material. If any such
material amendment or change is made such that, if such amendment or change is incorporated into
Borrower’s reporting, it would have the effect of permitting Borrower’s compliance with any
financial covenants or performance tests contained in this Loan Agreement when without such
amendment or other change, Borrower would not so comply, such amendment or change shall not be
given effect for purposes of such financial covenants or performance tests unless Agent otherwise
consents. Borrower may adopt such amendment or other change for purposes of its financial
statements and other reports required to be delivered to



9









 






Agent by Borrower hereunder, but Borrower shall deliver to Agent together with any statement
or report first giving effect to such change, the same such statement or report but without giving
effect to such change. If Agent consents to such amendment or change, such amendment or change
shall be effective thereafter for purposes of such financial covenants and performance tests.




          “GM Account” means an account with a bank or other financial institution selected by
Borrower and reasonably acceptable to Agent. The GM Account as of the Closing Date is set forth in
Schedule 4.11 attached hereto.




          “Governmental Authority” means any federal, state, county, municipal, parish,
provincial or other government, or any department, commission, board, court, agency, committee, or
quasi-governmental unit whether of the United States of America or any other country, or any
instrumentality of any of them, or any other political subdivision thereof.




          “Guarantor” means Interstate Hotels & Resorts, Inc., together with its permitted
successors and assigns pursuant to and in accordance with Section 5.16 hereof.




          “Implied Debt Service” means, as of the last day of any Calendar Quarter on which
Implied Debt Service is being calculated, an amount equal to the product of (a) the Implied Debt
Service Constant Percentage and (b) the outstanding principal balance of the Loan as of such date
of calculation.




          “Implied Debt Service Constant Percentage” means the greater of:





     (a) a percentage determined by dividing (i) the aggregate amount of Interest
payable at the Applicable Interest Rate(s) as of last day of the applicable Calendar
Quarter on which Implied Debt Service is being calculated (and taking into account
the effect of any Interest Rate Protection Agreement), determined on a weighted
average basis based on the respective outstanding principal balances of each Loan
Portion as of such date of calculation in the twelve-month period immediately
succeeding such date of calculation, by (ii) the outstanding principal balance of
the Loan as of such date of calculation;




     (b) eight percent (8.0%); and




     (c) an annual constant percentage applicable to a twenty-five (25) year level
payment mortgage-style amortization schedule payable monthly on the basis of a rate
of interest equal to two and one-half of one percent (2.50%) in excess of the then
most-recently published annual yield to maturity of the U.S. Treasury Constant
Maturity Series with a ten (10) year maturity, as such yield is reported on such
date in the “Federal Reserve Statistical Release H.15 – Selected Interest Rates”, or
any successor publication, published by the Board of Governors of the Federal
Reserve System of the United States of America in effect on such date of calculation
and the outstanding principal balance of the Loan as of such date of calculation.
In the event such rate per annum is no longer available, the rate described in the
foregoing clause (b) shall be the rate of interest equal to two and one-half of one
percent (2.50%) in excess of the most-recent per annum rate equal



10









 







to the annual yield to maturity on a comparable debt security with a ten (10)
year maturity issued by the Federal National Mortgage Association, as determined by
Agent.



          “Impositions” means and includes all taxes, assessments for public improvements or
benefits and any payments in lieu thereof, whether or not commenced or completed prior to the date
hereof or while any of the Obligations are outstanding, water rates and sewer rents, charges,
license fees, permit fees, inspection fees and other governmental levies or payments, of every kind
and nature whatsoever, general and special, foreseen or unforeseen, ordinary and extraordinary,
which now or at any time hereafter may be assessed, levied, confirmed, imposed or which may be
payable by Borrower with respect to the Mortgaged Property (excluding income and franchise taxes)
or become a lien upon the Mortgaged Property, or any portion thereof, or which are payable with
respect thereto, or upon the rents, issues, revenue, income, proceeds or profits thereof, or on the
occupancy, operation, use, possession or activities thereof, whether any or all of the same be
levied directly or indirectly or as excise or income or franchise taxes in lieu of taxes which are
otherwise imposed upon property of the same type as the Mortgaged Property, together with any
penalties or other charges with respect to the late payment or non-payment thereof.




          “Improvements” has the meaning set forth in the Mortgage.




          “Indebtedness” means, with respect to any Person,:





     (a) all indebtedness of such Person for borrowed money or for the deferred
purchase price of property or services (including all obligations, contingent or
otherwise in connection with letter of credit facilities, acceptance facilities or
other similar facilities);




     (b) all obligations of such Person evidenced by bonds, notes, debentures or
other similar instruments;




     (c) all indebtedness of such Person created or arising under any conditional
sale or other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property);




     (d) all capital lease obligations of such Person;




     (e) all obligations of such Person, contingent or otherwise, in connection with
indemnities, hold harmless agreements and similar arrangements and in connection
with interest rate exchange agreements and similar instruments; and




     (f) all indebtedness of the nature referred to in clauses (a) through
(e) above of another Person guaranteed directly or indirectly by, or secured
by (or for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any lien, security interest or other charge or



11









 







encumbrance upon or in property (including accounts and contract rights) owned
by, the Person with respect to whom Indebtedness is being determined, even though
such Person has not assumed or become liable for the payment of such Indebtedness.



          “Indemnified Party” has the meaning set forth in Section 9.1 hereof.




          “Insurance Policies” means the policies of insurance required to be maintained
pursuant to Section 5.11 hereof.




          “Insurance Requirements” means and includes all provisions of any Insurance Policy,
all requirements of the issuer of any such Insurance Policy, and all orders, rules, regulations and
other requirements of the National Board of Fire Underwriters (or any other body exercising similar
functions) applicable to or affecting the Premises.




          “Interest” means interest payable on the Loan at the Applicable Interest Rate or the
Default Rate, as applicable.




          “Interest Period” means the period commencing on each Payment Date and ending on the
day immediately preceding the next succeeding Payment Date, with the first Interest Period
commencing on the Closing Date.




          “Interest Rate Protection Agreement” has the meaning set forth in Section
2.6(a) hereof.




          “Interest Rate Protection Agreement Consent” has the meaning set forth in Section
2.6(a) hereof.




          “Interstate Operating” means Interstate Operating Company, LP a Delaware limited
partnership, together with its permitted successors and assigns pursuant to and in accordance with
this Section 5.16.




          “IRC” means the Internal Revenue Code of 1986, as amended.




          “Land” has the meaning set forth in the recitals hereof.




          “Lease” has the meaning set forth in the Mortgage, noting, however, for purposes of
the elimination of any ambiguity, that as provided in Section 5.10(a) hereof, Borrower
shall not enter into any Lease of the Premises or any portion thereof without Agent’s prior written
consent.




          “Legal Requirements” means, collectively, (a) all current and future laws, statutes,
regulations, ordinances, codes, rules, rulings, orders, judgments, decrees, injunctions and other
requirements of any Governmental Authority (including those regarding fire, health, handicapped
access, sanitation, ecological, historic, zoning, environmental protection, wetlands and building
laws and the Americans with Disabilities Act of 1990, Pub. L. No. 89-670, 104 Stat. 327 (1990), as
amended, and all regulations promulgated pursuant thereto) in any way directly or indirectly
applicable to Borrower or to the acquisition, construction, development,



12









 






sale, use, occupancy, possession, operation, management, maintenance or ownership of the
Premises, or any part thereof; and (b) all requirements of each Operating Permit.




          “Lender” and “Lenders” have the meaning set forth in the first paragraph of
this Loan Agreement.




          “Lender Interest Rate Protection Agreement” means any Interest Rate Protection
Agreement to which Borrower and PB Capital Corporation (and its successors or assigns) or any
Affiliate of PB Capital Corporation (and its successors or assigns) are parties in the event that
Borrower and PB Capital Corporation (and its successors or assigns) or its Affiliate elect to enter
into an Interest Rate Protection Agreement. Borrower’s performance of its obligations pursuant to
any Lender Interest Rate Protection Agreement is secured by the Collateral.




          “Lessee” means a lessee, sublessee, tenant, subtenant, licensee, concession holder or
other Person having the right to use or occupy all or any portion of the Premises pursuant to a
Lease or otherwise.




          “LIBOR” means (a) the London Interbank Offered rate (rounded upwards to the nearest
whole multiple of one hundredth of one percent (0.01%)) for Dollar deposits in an amount comparable
to the Loan Portion with respect to which the applicable LIBOR Rate is being determined as
appearing on Reuters Screen LIBOR 01 Page (formerly known as Telerate display page 3750) (or such
other page as may replace Reuter Screen LIBOR 01 Page on that service or such other service as may
be nominated by the British Bankers’ Association as the information vendor for the purpose of
displaying British Bankers’ Association Interest Settlement Rates for Dollar deposits) at
approximately 11:00 a.m. London time (or as soon thereafter as practicable) on the date that is two
(2) LIBOR Banking Days prior to the first day of the applicable LIBOR Rate Period and with respect
to which LIBOR is being determined for a time period equal to, or if no equal time period is so
appearing on Reuters Screen LIBOR 01 Page (formerly known as Telerate display page 3750) (or
substitute thereof as aforesaid), the time period so appearing which is most approximately equal to
such LIBOR Rate Period; or (b) if such method for determining LIBOR shall not be available, the
rate per annum (rounded upwards to the nearest whole multiple of one hundredth of one percent
(0.01%)) quoted by Agent’s principal London, England office at approximately 11:00 a.m. London time
(or as soon thereafter as practicable) on the date which is two (2) LIBOR Banking Days prior to the
first day of the LIBOR Rate Period for the offering by Agent’s principal London, England office to
leading banks in the London interbank market of Dollar deposits having a term comparable to such
LIBOR Rate Period and in an amount comparable to the principal amount of the Loan Portion with
respect to which the applicable LIBOR Rate is being determined.




          “LIBOR Banking Day” means any Business Day on which dealings in deposits in Dollars
are transacted in the London interbank market and banks are also open for business in London,
England.




          “LIBOR Rate” means, with respect to any period during which an Applicable Interest
Rate shall be a LIBOR Rate, an interest rate per annum equal to the sum of the LIBOR Rate Margin
plus the higher of (a) the applicable LIBOR or (b) two percent (2.0%).




13









 








          “LIBOR Rate Margin” means five percent (5.0%) per annum.




          “LIBOR Rate Period” means for any Loan Portion, each period for the computation of
Interest on a Loan Portion at a LIBOR Rate. Subject to Section 2.3(f) hereof, each LIBOR
Rate Period shall have a duration of one (1), two (2), three (3) or six (6) months, or one (1) year
as selected by Borrower in accordance with Section 2.3(b) or (c) hereof (or such
other period as Borrower and Agent shall agree), in each case, however, subject to availability to
the Lenders. Notwithstanding the foregoing, in the case of a LIBOR Rate Period which would
otherwise end after the date which is the Maturity Date, such LIBOR Rate Period shall have a
duration equal to the period commencing on the effective date of such LIBOR Rate Period and ending
on and including the Maturity Date. Each LIBOR Rate Period shall commence on the date selected by
Borrower in accordance with Section 2.3 hereof; provided, however, that
notwithstanding anything in this definition of LIBOR Rate Period to the contrary, (i) if any LIBOR
Rate Period would otherwise end on a day which is not a LIBOR Banking Day, such LIBOR Rate Period
shall be extended to the next succeeding LIBOR Banking Day, unless the result of such extension
would be to carry such LIBOR Rate Period over into another calendar month, in which event such
LIBOR Rate Period shall end on the immediately preceding LIBOR Banking Day and (ii) any LIBOR Rate
Period that begins on the last LIBOR Banking Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such LIBOR Rate Period)
shall end on the last LIBOR Banking Day of the subsequent calendar month.




          “Lien” means any deed of trust, mortgage, pledge, assignment of leases and rents,
security interest, encumbrance, lien or charge of any kind including any conditional sale or other
title retention agreement, any lease in the nature thereof, or the filing of, or any agreement to
give, any financing statement under the Uniform Commercial Code of any jurisdiction.




          “Loan” has the meaning set forth in Section 2.1 hereof.




          “Loan Agreement” has the meaning set forth in the first paragraph of this Loan
Agreement.




          “Loan Amount” has the meaning set forth in the recitals hereof.




          “Loan Documents” means, collectively, this Loan Agreement, the Note, the Mortgage, the
Assignment of Leases and Rents, the Assignment of Agreements, the Cash Management Agreement, the
Environmental Indemnity, the Recourse Liability Agreement, the Loan Fee Letter, Borrower’s
Certificate, the UCC Financing Statements, the Property Manager Subordination Agreement, the
Funding Direction Statement, all Account Agreements, all Credit Card Servicer Agreements, any
Lender Interest Rate Protection Agreement, any Assignment of Interest Rate Protection Agreement and
all other agreements, certificates or other documents now or hereafter evidencing or securing or
executed by Borrower or Guarantor (and UCC Financing Statements) in connection with the Loan.




          “Loan Fee Letter” means that certain letter dated as of the Closing Date between Agent
and Borrower pertaining to fees payable with respect to the Loan.




14









 








          “Loan Portion” means any principal of the Loan with respect to which an Applicable
Interest Rate has been established (and, in the case of any LIBOR Rate, whether or not such
Applicable Interest Rate has become effective); provided, however, that the amount
of any Loan Portion with respect to which a LIBOR Rate is established shall be at least equal to
$1,000,000.




          “Loan-to-Value Ratio” means the ratio (expressed as a percentage) of the outstanding
principal amount of the Loan as of the date of determination to the Appraised Value set forth in
the then-most current Appraisal or Appraisal Update.




          “Lockbox Account” means the “Deposit Account” as defined in the Cash Management
Agreement, or similar account under any other agreement in replacement thereof.




          “Major Lease” means a Lease of 5,000 or more rentable square feet




          “Management Agreement” means that certain Hotel Management Agreement dated as of May
24, 2007 between Borrower and Property Manager, together with such modifications as shall be
consented to by Agent in accordance with this Loan Agreement.




          “Material Adverse Effect” means a material adverse effect on (a) Borrower’s or
Guarantor’s, as applicable, business, property (including the Premises and other Collateral) or
other assets, operations, prospects or condition (financial or otherwise), taken as a whole, (b)
Borrower’s or Guarantor’s, as applicable, ability to perform its obligations under the Loan
Documents to which it is a party, including, with respect to Borrower, Borrower’s obligation to
keep the Property open and operating in accordance with Section 5.2 hereof, (c) the
enforceability or validity of any Loan Document or the perfection or priority of any Lien created
under any Loan Document, or (d) the rights, interests and remedies of Agent or any Lender under the
Loan Documents.




          “Material Operating Agreement” means the Operating Agreements listed on Schedule
4.17 hereto and any Operating Agreement entered into after the date hereof which requires
payments by Borrower in excess of three percent (3%) of Operating Revenues per each year of the
term thereof (provided that for Operating Agreements exceeding one (1) year, the payments thereof
for any year shall be on an averaged per year basis, e.g., a three-year agreement costing
$1,500,000 shall be deemed to have a per year cost of $500,000).




          “Material Taking” means a Taking (a) of any portion of the Premises unless the portion
so taken constitutes less than ten percent (10%) of the Land, such land is located along the
perimeter or periphery of the Land and no portion of the Improvements is located on such land
(other than the parking area or roadways, provided that the Premises at all times has physical
access to a public road), or (b) of such portion of the Premises or such other property which when
so taken would, in Agent’s reasonable determination, leave remaining a balance of the Premises
(and, if applicable, such other property) which, due to the amount and/or nature of the area so
taken and/or the location of the area taken in relation to the area not so taken, (i) would not,
under economic conditions, applicable zoning laws, building regulations and the requirements of
this Loan Agreement, the Leases, the Permitted Encumbrances, the Premises Documents, the Management
Agreement or the Franchise Agreement permit the Restoration of



15









 






the Premises or (ii) would upon restoration materially and adversely interfere with the
marketing, operation, use, leasing or maintenance of the Premises in accordance with the standards
set forth in Section 5.2(b) hereof.




          “Maturity Date” means the earlier of (a) October 27, 2014 or (b) the date that the
entire principal amount of the Loan shall otherwise become due and payable by acceleration or
otherwise.




          “Minimum Debt Service Coverage Ratio” means 1.5 to 1.0.




          “Monitoring Rate” has the meaning set forth in Section 2.6(a) hereof.




          “Monthly Amortization Payment” means each installment of principal of the Loan
required to be paid pursuant to clause (b) of Section 2.4 hereof.




          “Mortgage” means that certain Deed to Secure Debt, Security Agreement, Financing
Statement, Fixture Filing and Assignment of Rents dated as of the Closing Date made by Borrower in
favor of Agent.




          “Mortgaged Property” has the meaning set forth in the Mortgage.




          “Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of
ERISA to which Borrower or any ERISA Affiliate has any obligation or liability, contingent or
otherwise.




          “Net Operating Income” means, with respect to any period of calculation, the sum of
(a) all Operating Revenues during such period, as determined on a GAAP basis, excluding (i) any
income or gain arising from operations other than the operation of the Premises, (ii) any gain
arising from any write-up of assets, (iii) any loan proceeds or contribution of capital to Borrower
from Guarantor, (iv) any income derived from the sale or financing of any of the Collateral, (v)
insurance proceeds (other than business interruption or rental insurance proceeds), (vi) tips,
service charges, gratuities, or similar amounts received by employees, (vii) gross receipts of
tenants, licensees, concessionaires or similar third parties, (viii) condemnation proceeds or sales
proceeds in lieu of and/or under threat of any Taking (other than for a temporary Taking), (ix) any
net payments received by or for the account of Borrower from the Counterparty to any Interest Rate
Protection Agreement pursuant to the terms thereof, (x) prepayments of Rents or other amounts paid
more than one (1) month in advance and (xi) any extraordinary, non-contractual or non-recurring
items during the period with respect to which Operating Revenues are being determined, less (b) all
Impositions and other Operating Expenses and FF&E Expenditures for the Premises; assuming,
however, that management fees for such period shall be deemed equal to the greater of (i)
actual management fees paid or (ii) three percent (3%) of Operating Revenues, that franchise fees
for such period shall be deemed to be the actual franchise fees paid and that all FF&E Expenditures
for such period shall be deemed equal to the greater of (i) actual FF&E Expenditures incurred or
(ii) three percent (3.0%) of Operating Revenues; and excluding from Operating Expenses
(y) Interest, Additional Interest and principal payments payable hereunder and (z) depreciation,
amortization and any other non-cash item. Non-recurring Operating Expenses may be amortized over a
period acceptable to Agent.




16









 








          “Net Proceeds” means the amount of all insurance proceeds paid pursuant to any
Insurance Policy as the result of a Casualty, after deduction of the costs and expenses (including
fees of any insurance consultant or adjuster and reasonable attorneys’ fees and disbursements), if
any, incurred in collecting the same.




          “Net Restoration Award” means the amount of all awards and payments received on
account of a Taking, after deduction of the costs and expenses (including reasonable attorneys’
fees and disbursements), if any, incurred in collecting the same.




          “Non-Availability Notice” has the meaning set forth in Section 2.9(a) hereof.




          “Note” means that certain Promissory Note dated as of the Closing Date in an amount
equal to the Loan Amount made by Borrower in favor of Agent on behalf of Lenders, together with any
replacements or substitutes for the foregoing.




          “Obligations” means, collectively, all present and future indebtedness, obligations,
duties and liabilities of Borrower to Agent and Lenders arising pursuant to this Loan Agreement,
any Lender Interest Rate Protection Agreement and the other Loan Documents or evidenced by the
Note, and all interest accruing thereon, together with reasonable attorneys’ fees and disbursements
incurred in the drafting, negotiation, enforcement or collection thereof and of the other Loan
Documents, regardless of whether such indebtedness, obligations, duties or liabilities are direct,
indirect, fixed, contingent, joint, several or joint and several.




          “Operating Account” means an account with a bank or other financial institution
reasonably acceptable to Agent. The Operating Account as of the Closing Date is set forth in
Schedule 4.11 attached hereto.




          “Operating Agreement” means any agreement entered into by Borrower, other than the
Leases, the Premises Documents, the Management Agreement and the Franchise Agreement, which relates
to the ownership, operation or maintenance of, or the use, licensing or leasing of any personal
property or equipment in connection with the operation and maintenance of, the Premises.




          “Operating Expenses” means, for any period, collectively but without duplication, all
Impositions, insurance premiums, management fees, including incentive management fees and all other
and additional operating costs and expenses incurred by Borrower during such period in connection
with the ownership, use, occupancy, management, leasing and operation of the Premises, including
payments under any lease of furniture, fixtures and equipment for the Premises, determined on an
accrual basis, subject to annualized adjustments in accordance with GAAP.




          “Operating Permits” means, collectively, all authorizations, consents and approvals
given by and licenses and permits issued by Governmental Authorities which are required for the
ownership, leasing, use, operation and occupancy of the Premises in accordance with this Loan
Agreement, the other Loan Documents, all Legal Requirements, the Permitted Encumbrances, the
Management Agreement and the Franchise Agreement, and for the performance and observance of all
Legal Requirements and all agreements, provisions and



17









 






conditions of Borrower contained herein and therein otherwise pertaining to the ownership, use
and occupancy of the Premises, including liquor licenses.




          “Operating Revenues” means all receipts determined on a GAAP basis of Borrower from or
related to the leasing, use, ownership and operation of, or otherwise derived from, the Premises,
including all Rents, concession fees and charges and other miscellaneous operating revenues and
sums paid to Borrower from users of parking spaces and other facilities or amenities located on the
Premises and proceeds from rental or business interruption insurance, but excluding security
deposits under any Lease unless and until they are forfeited by the depositor.




          “Participant” has the meaning set forth in Section 7.2 hereof.




          “Patriot Act” means the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as the same may
be amended from time to time, and corresponding provisions of future laws.




          “Patriot Act Offense” has the meaning set forth in Section 4.35 hereof.




          “Payment Date” means the first (1st) day of each calendar month during the
Term and the Maturity Date. “Payment Date” shall also include such earlier date, if any, on which
the unpaid principal balance of the Loan is paid in full.




          “PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA
and any successor entity performing similar functions.




          “Pension Plan” means any employee pension benefit plan (other than a Multiemployer
Plan) subject to the provisions of Title IV of ERISA, IRC Section 412 or Section 302 of ERISA, and
in respect of which a Borrower or any ERISA Affiliate is (or, if such plan were terminated, would
under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.




          “Permitted Encumbrances” means, collectively, (a) the matters set forth in Schedule B
of the Title Policy, (b) Liens created by the Loan Documents, (c) Liens (i) for Impositions which
are not yet due or delinquent or which are being contested in good faith by Borrower in accordance
with this Loan Agreement or (ii) for charges under Permitted Encumbrances which are not yet due or
delinquent or which are being contested in good faith by Borrower in accordance with this Loan
Agreement, (d) liens for equipment leases permitted under this Loan Agreement and (e) such matters
expressly consented to by Agent in its discretion.




          “Permitted Indebtedness” means any Indebtedness of Borrower under (a) the Loan
Documents, (b) Interest Rate Protection Agreements, (c) incidental indemnity and hold harmless
agreements under agreements entered into by Borrower in accordance with this Loan Agreement, (d)
capital leases incurred by Borrower in the ordinary course of operating the Premises which do not
exceed, in the aggregate at any time, $100,000 and (e) unsecured trade payables not evidenced by a
promissory note incurred by Borrower in the ordinary course of



18









 






operating the Premises which (i) do not exceed, in the aggregate at any time, $600,000, and
(ii) are paid within sixty (60) days of the date incurred.




          “Permitted Personal Property Transaction” means any (a) sale of inventory in the
ordinary course of business and in compliance with the operating standards set forth in Section
5.2(b) hereof, provided such inventory is not needed to maintain such operating standards or to
comply with the Franchise Agreement, (b) the sale, assignment, trade, transfer, exchange or other
disposition of any item of Personal Property in the ordinary course of business and in compliance
with the operating standards set forth in Section 5.2(b) hereof which (i) has become
obsolete or worn beyond practical use or inadequate, unfit or unadapted for use in the operation of
the Premises or the removal and/or replacement of which would result in a cost savings, (ii) has
been replaced by a substitute having a value or utility equal to or greater than the replaced item
when new, which replacement item is owned by Borrower and is subject to a first, perfected security
interest in favor of Agent for the benefit of Lenders, (iii) is required under the Franchise
Agreement or (iv) is set forth in the applicable operating/capital/FF&E budget delivered to Agent
pursuant to Section 5.1(f) hereof and, to the extent required therein, approved by Agent,
and (c) equipment financing which qualifies as Permitted Indebtedness.




          “Permitted Transfer” has the meaning set forth in Section 5.16 hereof.




          “Permitted Transferee” has the meaning set forth in Section 5.16 hereof.




          “Person” means an individual, partnership, limited partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated association, joint
venture, or other entity of any kind.




          “Personal Property” has the meaning set forth in the Mortgage.




          “Pfandbrief Pledge” has the meaning set forth in Section 7.1 hereof.




          “Plan Assets” has the meaning set forth in Section 4.25 hereof.




          “Premises” has the meaning set forth in the Mortgage.




          “Premises Documents” has the meaning set forth in the Mortgage.




          “Prepayment Fee” means (i) for each prepayment of the principal amount of the Loan
made prior to October 27, 2010, an amount equal to three percent (3.0%) of the amount of such
prepayment amount, (ii) for each prepayment of the principal amount of the Loan made on or after
October 27, 2010 and prior to October 28, 2011, an amount equal to two percent (2%) of such
prepayment amount and (iii) for each prepayment of the principal amount of the Loan made on or
after October 27, 2011 but prior to October 28, 2012, an amount equal to one percent (1%) of such
prepayment amount. There is no Prepayment Fee for any prepayment of the principal amount of the
Loan made on or after October 27, 2012.




          “Pro Rata Share” means with respect to all matters relating to any Lender, the
percentage obtained by dividing (a) the Commitment of such Lender by (b) the aggregate Commitment
of all Lenders, in each case as of the date of determination.




19









 








          “Property Manager” means Interstate Management Company, L.L.C., and, subject to
Section 5.2 hereof with respect to assignments which require Borrower’s consent pursuant to
the Management Agreement, its successors and assigns under the Management Agreement or any other
property manager of the Premises reasonably acceptable to Agent provided no Event of Default
exists.




          “Property Manager Subordination Agreement” means that certain Subordination and
Consent Agreement dated as of the Closing Date between Agent and Property Manager and consented to
by Borrower, and any similar agreement hereafter entered into between Agent and Property Manager
with respect to any future Management Agreement.




          “Public Company” means a company that is listed on the New York Stock Exchange, Inc.
or other public exchange in the United States of America and is subject to the oversight of and
regulation by the United States Securities and Exchange Commission.




          “Qualified Counterparty” means a financial institution (other than a Lender) whose
senior long term debt is rated A or better by Standard & Poor’s Ratings Group, A2 or better by
Moody’s Investors Service, Inc., or equivalent rating by Fitch Inc.




          “Rating Agencies” shall mean Standard & Poor’s Ratings Services, a division of The
McGraw-Hill Companies, Inc. (“S&P”), Moody’s Investors Service, Inc. (“Moody’s”),
and Fitch, Inc. (“Fitch”), and any other nationally-recognized statistical rating agency
which has been designated by Agent.




          “Recourse Liability Agreement” means that certain Recourse Liability Agreement dated
the date hereof made by Guarantor for the benefit of Agent.




          “Recourse Liability Events” means, collectively, any or all of the following:





     (a) without limiting clause (a) of the definition of “Full Recourse
Event” set forth in this Section 1.1, fraud or willful misconduct on the
part of Borrower or Guarantor or any of their respective principals, directors,
officers, agents or employees;




     (b) any intentional material breach of a representation or warranty on the part
of Borrower or Guarantor or any of their respective principals, directors, officers,
agents or employees;




     (c) appropriation or application by Borrower or Guarantor or any of their
respective principals, directors, officers, agents or employees of the proceeds of
the Loan, Operating Revenues, insurance proceeds, condemnation awards, Security
Deposits, sums payable pursuant to any Interest Rate Protection Agreement, funds
from any Account, reserve funds or proceeds of the disposition of all or any portion
of the Collateral in contravention of this Loan Agreement or any other Loan
Document;



20









 






     (d) distributions, dividends or payments made by Borrower in contravention of
Section 5.24 of this Loan Agreement or any other Loan Document;




     (e) any failure of Borrower to pay any cost or expense of any nature, including
attorneys’ fees and disbursements, transfer taxes and/or fees imposed by a
Governmental Authority as a result of the transfer of the Premises or any portion
thereof, incurred by Agent and Lenders in connection with or arising out of the
enforcement of the Loan or any of the Loan Documents by Agent, to the extent of such
costs and expenses;




     (f) any intentional act of physical waste of the Mortgaged Property, any part
thereof, by Borrower or Guarantor or any of their respective principals, directors,
officers, agents or employees; and




     (g) any Full Recourse Event.




     “Register” has the meaning set forth in Section 7.6 hereof.



          “Regulatory Change” means any change after the date hereof in any law, regulation or
treaty (including Regulation D of the Board of Governors of the Federal Reserve System), or any
adoption after the date hereof of any new law, regulation or treaty, or in the interpretation or
administration of any law, regulation or treaty by any domestic or foreign governmental or monetary
authority charged with the interpretation or administration thereof (whether or not having the
force of law and whether or not failure to comply therewith would be unlawful), or by any domestic
or foreign court.




          “Rents” has the meaning set forth in the Mortgage.




          “Requisite Lenders” means, at any time, non-Defaulting Lenders having Commitments
representing at least sixty-six and two-thirds percent (66 2/3%) of the total Commitments of all
non-Defaulting Lenders at such time.




          “Restoration” means in case of a Casualty or a Taking, the restoration, replacement or
rebuilding of the portion of the Premises affected by the Casualty or Taking such that when such
restoration, replacement or rebuilding is completed, the Premises shall have been restored, in the
case of any Casualty, substantially to the same character and condition as prior to such Casualty,
and in the case of any Taking, to an integral unit as substantially similar as possible, taking
into account the extent of the Taking, to the character and condition of the Premises prior to such
Taking, in each case in accordance with this Loan Agreement, all Legal Requirements, the Leases,
the Premises Documents, the Permitted Encumbrances and the Franchise Agreement, and to the extent
any alterations or additions were made in compliance with this Loan Agreement, with any such
alterations or additions. In any case, Restoration shall (i) provide substantially the same (but
in no case less than what is required by Legal Requirements, the Leases, the Premises Documents,
the Permitted Encumbrances and the Franchise Agreement) amount and type of, and rights with respect
to, utilities and parking spaces applicable to the Premises as existed prior to such Casualty or
Taking, (ii) provide sufficient (in Agent’s reasonable determination) access across and over the
Premises to the public roads and



21









 






highways, and (iii) be such that the Loan-to-Value Ratio of the Premises, as determined by an
Appraisal ordered by Agent at Borrower’s expense on or after the occurrence of the Casualty or
Taking, when so restored, together with the amount of any Net Proceeds or Net Restoration Award
received by Agent and applied in repayment of the principal amount of the Loan, shall be equal to
or less than sixty percent (60%).




          “Security Deposit” means any cash security or other deposit given by or on behalf of a
Lessee to the landlord under a Lease.




          “Security Documents” means, collectively, this Loan Agreement, the Mortgage, the
Assignment of Agreements, the Assignment of Leases and Rents, any Account Agreement, the UCC
Financing Statements and any other Loan Document entered into to secure the Obligations.




          “Special Purpose Bankruptcy Remote Entity” has the meaning set forth on
Exhibit D attached hereto.




          “Strike Rate” has the meaning set forth in Section 2.6(a) hereof.




          “Survey” means that certain survey prepared by Mark G. Lee of Paul Lee Associates
Engineering Associates, Inc., dated September 25, 2009 and updated on October 22, 2009.




          “Taking” (and its correlative meanings) means any temporary or permanent taking by any
Governmental Authority of the Premises or any portion thereof through eminent domain, condemnation
or other proceedings or by any settlement or compromise of such proceedings, or any voluntary
conveyance of such property or any portion thereof during the pendency of any such proceedings.




          “Taxes” has the meaning set forth in Section 2.8 hereof.




          “Tenant Security Account” means an account with a bank or other financial institution
reasonably acceptable to Agent. The Tenant Security Account as of the Closing Date is set forth in
Schedule 4.11 attached hereto




          “Term” means the period commencing on the Closing Date and ending on the then Maturity
Date.




          “Title Company” means First American Title Insurance Company.




          “Title Policy” means the mortgagee title insurance policy in favor of Agent issued on
the Closing Date, including all endorsements thereto, in an amount equal to the Loan Amount and
otherwise in form and content acceptable to Agent.




          “Transfer” means directly or indirectly (a) the conveyance, transfer, assignment,
pledge, mortgage, encumbrance, hypothecation or sale, by operation of law or otherwise (including
any installment sales agreement for any of the foregoing for a price to be paid in installments),
of (i) the Collateral, or any part thereof or interest therein or (ii) any direct or



22









 






indirect equity or beneficial interest in Borrower, (b) the leasing of all or substantially
all of the Premises, (c) the admission of any new member or other owner of any equity or beneficial
interest in Borrower or the appointment of any non-member manager of Borrower, or (d) any change in
Borrower’s composition or form of business association or any modification of the Borrower
Operating Agreement or any of the other organizational documents of Borrower which would result in
a change of control (as defined in the definition of “Affiliate” in this Section 1.1) of
Borrower or the rights of Guarantor with respect thereto.




          “UCC Financing Statements” means such UCC financing statements as Agent shall deem
necessary or desirable to perfect Agent’s security interest in the Collateral (or any portion
thereof).




          “Withdrawal Liability” means at any time the aggregate liability incurred (whether or
not assessed) with respect to all Multiemployer Plans pursuant to Section 4201 of ERISA or for
increases in contributions required to be made pursuant to Section 4243 of ERISA.




          “Zoning Report” means that certain zoning report dated October 21, 2009 prepared by
Property and Zoning Resources, Inc. for Agent (Project No. 49836-1).




          SECTION 1.2.    Other Definitional Provisions.




          (a) All terms defined in this Loan Agreement shall have the above-defined meanings when used
in the Note or any of the other Loan Documents, or in any other certificate, report or other
document made or delivered pursuant to this Loan Agreement, unless the context therein shall
otherwise require.




          (b) Whenever appropriate herein or required by the context or circumstances, the masculine
shall be construed as the feminine and/or the neuter, the singular as the plural, and vice versa.




          (c) The words “hereof”, “herein”, “hereunder” and similar terms when used in this Loan
Agreement shall refer to this Loan Agreement as a whole and not to any particular provision of this
Loan Agreement.




          (d) The words “include” and “including” wherever used in this Loan Agreement or any other Loan
Document shall be deemed to be followed by the words “without limitation”.




          (e) Any reference to any Loan Document or any other document, instrument or agreement in this
Loan Agreement or in any other Loan Document shall be deemed to mean such Loan Document or other
document, instrument or agreement, as applicable, as it may from time to time be amended,
supplemented, restated, consolidated, severed, split, extended, substituted for, partially
released, replaced, increased, waived, cross-collateralized, renewed or otherwise modified in
accordance with the terms of the Loan Documents.




23









 








ARTICLE II




THE LOAN




          SECTION 2.1.    The Loan; Use of Funds. Subject to the conditions and upon the terms herein
provided, each Lender severally agrees to lend to Borrower and Borrower agrees to borrow from each
Lender, on the Closing Date, an amount up to such Lender’s Commitment, which Commitments in the
aggregate shall equal the Loan Amount (the “Loan”). The Loan shall be made by Lenders
ratably in proportion to their respective Commitments. The Loan shall be evidenced by the Note.
Interest and Additional Interest, if any, shall be payable in accordance with the Note and this
Loan Agreement. The Loan shall be repaid with Interest, Additional Interest, costs, fees and
charges as more particularly set forth in this Loan Agreement, the Note, the Mortgage and the other
Loan Documents. Principal amounts of the Loan which are repaid for any reason may not be
reborrowed. The proceeds of the Loan shall be received, held and used by Borrower for (a) costs
incurred by Borrower to close the Loan and (b) repayment of certain Indebtedness secured by the
Mortgaged Property to the extent required under the documents evidencing such indebtedness to
obtain a release of the security interests in the Mortgaged Property granted in connection
therewith and a release of Borrower from its obligations and liabilities thereunder.




          SECTION 2.2.    Interest.




          (a) Interest at the Applicable Interest Rate. Until paid in full, and subject to
Sections 2.5(c) and 2.9 hereof, each Loan Portion shall bear interest at an
interest rate (an “Applicable Interest Rate”) which shall be a LIBOR Rate or Base Rate as
designated by Borrower pursuant to Section 2.3 hereof or as otherwise provided in
Section 2.3 or 2.9 hereof.




          (b) Interest Payments. Borrower shall pay Interest as provided in this Loan Agreement on each
Loan Portion on each Payment Date, in arrears, for the Interest Period then ending. Borrower shall
pay Additional Interest as and when provided herein, and in the event any Lender Interest Rate
Protection Agreement is in effect, in such Lender Interest Rate Protection Agreement.




          (c) Calculation of Interest.




               (i) Interest accruing at the Applicable Interest Rate shall be calculated on the basis of the
actual number of days elapsed and a year of 360 days.



               (ii) Any change in the Base Rate shall be automatically effective as of the day on which such
change in rate occurs.



               (iii) Each determination of an interest rate by Agent pursuant to any provision of this Loan
Agreement shall be conclusive and binding on Borrower in the absence of manifest error.



24









 





          SECTION 2.3.    Determination of Applicable Interest Rate.




          (a) Applicable Interest Rate.




               (i) The initial Applicable Interest Rate for the Loan as of the Closing Date shall be as
provided in the Funding Direction Statement, and thereafter the Applicable Interest Rate(s) shall
be as determined pursuant to the remainder of this Section 2.3.



               (ii) The Applicable Interest Rate (and any related LIBOR Rate Period) from time to time
applicable to each Loan Portion upon and after the expiration of the period set forth in
Section 2.3(a) hereof and any LIBOR Rate Period applicable to such Loan Portion pursuant to
Section 2.3(b) hereof shall be determined in the manner set forth in Section
2.3(c), (d) and (e) hereof.



               (iii) At any particular time, the sum of all Loan Portions shall equal the outstanding
principal amount of the Loan.



          (b) Intentionally Omitted.




          (c) LIBOR Rate Conversion Options. Subject to Sections 2.5(c) and 2.3(f)
hereof, Borrower may elect to convert the Applicable Interest Rate (i) with respect to any Loan
Portion which bears interest at the Base Rate, from the Base Rate to a LIBOR Rate effective on any
LIBOR Banking Day, or (ii) with respect to any portion of the Loan which bears interest at a LIBOR
Rate, from such LIBOR Rate to another LIBOR Rate effective upon the expiration of the then current
LIBOR Rate Period; provided, however, that (x) there shall not have occurred and be
continuing any Default or Event of Default, (y) the circumstances referred to in Section
2.9 hereof shall not have occurred and be continuing, and (z) after giving effect to such
conversion, there shall be no more than one (1) LIBOR Rate in effect. If Borrower wishes to
convert the Applicable Interest Rate on any Loan Portion as permitted by the preceding sentence,
Borrower shall give notice thereof (which shall be irrevocable) to Agent prior to 1:00 p.m. (New
York City time) on the day that is not less than three (3) LIBOR Banking Days prior to the proposed
conversion date specifying (A) the principal amount of the Loan with respect to which such
conversion shall occur, (B) the proposed conversion date, which shall be determined in accordance
with the preceding sentence, and (C) the applicable LIBOR Rate Period.




          (d) Reversion to Base Rate or One-Month LIBOR Rate. If Borrower fails timely to notify Agent
in accordance with Section 2.3(c) or (e) hereof of Borrower’s election of a LIBOR
Rate or Base Rate for any Loan Portion with an expiring LIBOR Rate Period or fails to provide all
of the information required by Section 2.3(c) or (e) hereof for the election of a
LIBOR Rate or a Base Rate, as applicable, the Applicable Interest Rate of such Loan Portion,
automatically upon the expiration of such LIBOR Rate Period, shall convert to, in each case
provided no Event of Default exists, a LIBOR Rate having a LIBOR Rate Period of one (1) month or,
if such one-month LIBOR Rate Period would end after the Maturity Date, a LIBOR Rate Period having a
duration equal to the period commencing upon the expiration of such expiring LIBOR Rate Period and
ending on and including the Maturity Date, subject to the proviso in the definition of “LIBOR Rate
Period” herein, or if an Event of Default exists, the Base Rate. If Borrower is not permitted to
elect a LIBOR Rate pursuant to clause (x) or (z) of




25









 







Section 2.3(c) hereof, the Applicable Interest Rate of such Loan Portion,
automatically upon the expiration of such LIBOR Rate Period, shall convert to a Base Rate.




          (e) Base Rate. Subject to Sections 2.5(c) and 2.3(f) hereof, Borrower may
elect to convert the Applicable Interest Rate with respect to any portion of the Loan which bears
interest at a LIBOR Rate, from such LIBOR Rate to a Base Rate effective upon the expiration of the
then current LIBOR Rate Period, so long as there shall not have occurred and be continuing any
Default or Event of Default. If Borrower wishes to convert the Applicable Interest Rate on any
Loan Portion as permitted by the preceding sentence, Borrower shall give notice thereof (which
shall be irrevocable) to Agent prior to 1:00 p.m. (New York City time) on the day that is not less
than three (3) LIBOR Banking Days prior to the proposed conversion date specifying (A) the
principal amount of the Loan with respect to which such conversion shall occur, and (B) the
proposed conversion date, which shall be determined in accordance with the preceding sentence.




          (f) Interest Rate Corresponding to Interest Rate Protection Agreements; Base Rate.
Notwithstanding anything to the contrary set forth in this Section 2.3, at all times that
an Interest Rate Protection Agreement is in effect, Borrower shall cause a portion of the Loan
corresponding to the notional amount with respect to which any such Interest Rate Protection
Agreements were established to have an Applicable Interest Rate which is a LIBOR Rate having a
LIBOR Rate Period that is the period used in such Interest Rate Protection Agreement.




          (g) Notice of Applicable Interest Rate Conversion. Agent shall promptly notify each Lender
upon its receipt of notice from Borrower pursuant to Section 2.3(c) or (e) hereof
electing to convert to an Applicable Interest Rate.




          SECTION 2.4.    Principal Payments.




          (a) Principal Payment at Maturity. Borrower shall pay the unpaid principal balance of the
Loan in a single installment on the Maturity Date, together with all accrued Interest and all other
sums due under the Loan Documents. Concurrently with any such repayment, Borrower shall pay to
Agent all other sums required to be paid pursuant to Section 2.4(g) hereof.




          (b) Amortization Payments. On the Amortization Commencement Date and on each Payment Date
thereafter, Borrower shall pay to Agent a fluctuating amount of principal which, if paid monthly
together with monthly interest payments due hereunder, would fully amortize an amount equal to the
outstanding principal balance of the Loan as of the Amortization Commencement Date over a
twenty-five (25) year period assuming a level payment mortgage-style monthly amortization schedule
commencing on the Amortization Commencement Date and an interest rate equal to eight percent (8.0%)
per annum. Concurrently with any such prepayment, Borrower shall pay to Agent all sums required to
be paid pursuant to, and shall otherwise comply with, Section 2.4(g) hereof.




          (c) Prepayments from Cash Flow. If a Cash Sweep Condition exists, then on each Payment Date
all of the funds on deposit in the “Cash Flow Payment Sub-account”



26









 






referenced in the Cash Management Agreement (or such portion thereof determined by Agent) may
be applied by Agent, at its election, as prepayments of the Loan until the Loan has been prepaid by
an amount which, when applied to the reduction of the principal amount of the Loan employed in the
determination of the Debt Service Coverage Ratio giving rise to such Cash Sweep Condition, would
result in such Debt Service Coverage Ratio, if recomputed, being greater than the Minimum Debt
Service Coverage Ratio. If Agent elects not to apply such funds, such funds shall remain on
deposit in the Cash Flow Payment Sub-account as Collateral. Concurrently with any such prepayment,
Borrower shall pay to Agent all sums required to be paid pursuant to, and shall otherwise comply
with, Section 2.4(g) hereof.




          (d) Optional Prepayments. Borrower may, upon at least thirty (30) days’ prior written notice
to Agent, prepay the Loan, in whole or in part (in amounts equal to at least $1,000,000), in
accordance with this Section 2.4(d). Any such prepayment notice shall specify the date and
amount of the prepayment and the Applicable Interest Rate for each Loan Portion (for any portion
thereof) being prepaid (identifying said Applicable Interest Rate(s) and the expiration date of the
LIBOR Rate Period(s), if any, applicable to said Loan Portion(s) (or portion thereof) being
prepaid) and shall be irrevocable after the third (3rd) day preceding the prepayment
date specified in such notice. Concurrently with, and as a condition to, any such prepayment,
Borrower shall pay to Agent all sums required to be paid pursuant to, and shall otherwise comply
with, Section 2.4(g) hereof. If any prepayment notice is revoked by Borrower, Borrower
shall pay to Agent all Additional Interest arising on account of such revocation within five (5)
Business Days after written demand by Agent.




          (e) Other Sums. Borrower shall pay to Agent all other sums owed to Agent and/or Lenders
pursuant to the Loan Documents when such sums are due and payable as provided in the applicable
Loan Document, or if no required date for payment is provided therein, within five (5) Business
Days after written demand by Agent. To the extent any other such sums are determined on a per diem
or similar basis, such sums shall be calculated on the basis of a 360-day year and the actual
number of days elapsed.




          (f) Mandatory Prepayment. Borrower shall be required to prepay the Loan as and when required
pursuant to Sections 2.19, 5.12 and 5.13 hereof or the Mortgage by paying
the principal amount so required to be prepaid. Concurrently with any such prepayment, Borrower
shall pay to Agent all sums required to be paid pursuant to, and shall otherwise comply with,
Section 2.4(g) hereof.




          (g) Reduction of Interest Rate Protection Arrangement and Payment of Other Sums. Concurrently
with any repayment or prepayment of principal of the Loan pursuant to this Section 2.4,
Borrower shall, as a further condition of such prepayment, (v)(1) in the case of any Lender
Interest Rate Protection Agreement other than an interest rate cap, cause a reduction of the
notional amount of such interest rate protection arrangement so as to cause such notional amount to
correspond to the outstanding principal amount of the Loan, after giving effect to such repayment
or prepayment, (2) pay all sums, if any, payable by Borrower pursuant to any Interest Rate
Protection Agreement with respect to such reduction and (3) provide evidence to Agent of Borrower’s
compliance with clauses (1) and (2) above, (w) pay all accrued and unpaid Interest
to and including the date of such repayment or prepayment on the amount being repaid or prepaid,
(x) except with respect to any repayment pursuant to Sections 2.4(b) and




27









 







(c) hereof, pay all Additional Interest and any other amounts due and payable
hereunder, and under the Note, the Mortgage and the other Loan Documents, including all Additional
Interest that may be due and payable as a result of such repayment or prepayment, (y) except with
respect to any prepayment or repayment pursuant to Section 2.4(b), (c) or
(f) hereof, pay the Prepayment Fee, if any, applicable to such prepayment or repayment and
(z) except with respect to any repayment pursuant to Section 2.4(b) and (c) hereof,
pay all reasonable fees and expenses incurred by Agent in connection with the Loan pursuant to the
Loan Documents.




          SECTION 2.5.    Payment; Default Rate; Application of Certain Monies; Priority of Payments;
Set-offs.




          (a) Manner of Payment. All sums payable by Borrower under this Loan Agreement or any other
Loan Document shall be made in Dollars and in immediately available funds not later than 1:00 p.m.
(New York City time) on the date when such payment is due. Such sums shall be payable by wire
transfer to the credit of Agent, at Bank of New York, ABA #021-000-018, in favor of PB Capital
Corp., Account #8900388935, Reference: Westin Atlanta Airport Hotel, or to such other account or
address as Agent may from time to time designate in writing to Borrower. In the event that any
sums are received by Agent from or on behalf of Borrower after the applicable time limit set forth
in this Section 2.5(a), such sums shall be treated as being received by Agent on the
immediately succeeding Business Day for all purposes and Borrower shall be responsible for any
costs of Agent and Lenders resulting therefrom, including any Additional Interest or overdraft
charges.




          (b) Payment on a Non-Business Day. Whenever any payment to be made under the Loan Documents
shall be stated to be due, or if the Maturity Date would otherwise occur, on a day which is not a
Business Day, such payment shall be made, and the Maturity Date shall occur, as applicable, on the
immediately succeeding Business Day. Any such extension of time shall be included in the
computation of payment of Interest (including interest at the Default Rate), fees, and Additional
Interest.




          (c) Default Rate.




               (i) Notwithstanding anything to the contrary contained herein or in another Loan Document, if
an Event of Default shall have occurred and be continuing, each Loan Portion shall bear Interest
from and including the date of the occurrence of such Event of Default (after as well as before
judgment) at a fluctuating rate of interest per annum equal to the Default Rate with respect to
each Loan Portion, which interest at the Default Rate shall be payable upon demand of Agent.
Interest accruing at the Default Rate shall be calculated on the basis of the actual number of days
elapsed and a year of 360 days.



               (ii) If Borrower shall fail to make a payment on the due date therefor (i.e., the scheduled
due date or within the required number of days following written demand therefor to the extent
provided under the Loan Documents) of any sum under the Loan Documents (whether principal (other
than principal which is accruing interest at the Default Rate pursuant to Section 2.5(c)(i)
above), Interest, Additional Interest or other amounts), such sum shall bear Interest from and
including the date such payment is due to but excluding the date



28









 







such payment is made (after as well as before judgment) at a fluctuating rate of interest per
annum equal to the Default Rate with respect to such sum.



               (iii) Agent’s failure to collect interest at the Default Rate at any time shall not constitute
a waiver of Agent’s right thereafter, at any time and from time to time (including upon
acceleration of the Maturity Date or upon payment in full of the Loan), to collect such previously
uncollected interest at the Default Rate or to collect subsequently accruing interest at the
Default Rate.



          (d) Late Payment Fee. Borrower shall pay to Agent for the account of the Lenders a late
payment premium in the amount of five percent (5%) of any payment of principal, Interest,
Additional Interest, fee or other amount (excluding principal due on the Maturity Date) payable
under any Note, this Loan Agreement or the other Loan Documents made more than five (5) days after
the due date thereof, which late payment premium shall be due with any such late payment. The
acceptance of a late payment premium shall not constitute a waiver of any Default or Event of
Default then existing or thereafter arising. Agent’s failure to collect a late payment premium at
any time shall not constitute a waiver of Agent’s right thereafter, at any time and from time to
time (including upon acceleration of the Maturity Date or upon payment in full of the Loan), to
collect such previously uncollected late payment premiums or to collect subsequently accruing late
payment premiums.




          (e) Priority of Payments. All payments received with respect to the Loan shall be applied on
account of sums due and owing pursuant to the Note, this Loan Agreement, the Mortgage or the other
Loan Documents in the manner set forth in the Note.




          (f) No Set-offs. All sums payable by Borrower under the Note, this Loan Agreement and the
other Loan Documents shall be paid in full and without set-offs, counterclaims, deductions or
withholdings of any kind.




          SECTION 2.6.    Interest Rate Protection Agreement.




          (a) Interest Rate Protection Agreement. Within seven (7) days after the twenty-first
(21st) consecutive day on which LIBOR (as distinguished from the LIBOR Rate) applicable
to a LIBOR Rate Period of one (1) month (the “Monitoring Rate”), if in effect on such days,
would equal or exceed two and one-half of one percent (2.50%) per annum (the “Strike
Rate”), Borrower shall enter into and satisfy all conditions precedent to the effectiveness of
an agreement (an “Interest Rate Protection Agreement”) that shall satisfy all of the
following conditions and shall thereafter maintain such Interest Rate Protection Agreement in full
force and effect during the Term:




               (i) The Interest Rate Protection Agreement shall be an interest rate swap, cap, collar or
other derivative agreement in customary form and otherwise acceptable to Agent, the effect of which
is to protect Borrower against upward fluctuations of an Applicable Interest Rate which is LIBOR
(as distinguished from the LIBOR Rate) applicable to a LIBOR Rate Period of one (1) month in excess
of a per annum rate of three percent (3.0%) during the then-remaining portion of the Term and in
the notional amount equal to the then-outstanding principal amount of the Loan;



29









 





               (ii) The Interest Rate Protection Agreement shall be entered into between Borrower and, at
Borrower’s election, Agent, an Affiliate of Agent or a Qualified Counterparty (provided that
neither Agent nor any Affiliate of Agent shall have any obligation to offer to Borrower or any
other Person or to enter into with Borrower or any other Person any Interest Rate Protection
Agreement);



               (iii) In the case of an Interest Rate Protection Agreement which is an interest rate cap
agreement, all sums payable by Borrower on account of the purchase price for such Interest Rate
Protection Agreement during the term of the Interest Rate Protection Agreement shall have been paid
in full on or prior to the effective date thereof;



               (iv) Borrower’s interest in such Interest Rate Protection Agreement, including all rights of
Borrower to payment thereunder and any residual value thereof, shall have been collaterally
assigned to Agent pursuant to an Assignment of Interest Rate Protection Agreement in the form
annexed hereto as Schedule 2.6(a), which shall have been executed and delivered by Borrower
on or prior to its entry into such Interest Rate Protection Agreement;



               (v) The financial institution which is the Counterparty to such Interest Rate Protection
Agreement shall have executed and delivered to Agent a consent to the collateral assignment of
Borrower’s interest in such Interest Rate Protection Agreement referred to in clause (iv)
above pursuant to a consent in the form annexed to the Assignment of Interest Rate Protection
Agreement or otherwise in form and content reasonably acceptable to Agent (the “Interest Rate
Protection Agreement Consent”); and



               (vi) The requirements set forth in Section 2.7(i), if applicable, shall have been
satisfied; and



               (vii) Such Interest Rate Protection Agreement shall otherwise be satisfactory to Agent in form
and content.



          (b) Intentionally Omitted.




          (c) Institution of Interest Rate Protection Agreement. Borrower shall, within ten (10)
Business Days after the twenty-first (21st) consecutive day on which the Monitoring Rate
exceeds the Strike Rate, deliver to Agent evidence satisfactory to Agent that Borrower has entered
into and satisfied all requirements to the effectiveness of an Interest Rate Protection Agreement
that shall satisfy all of the requirements set forth herein.




          (d) Failure to Provide Interest Rate Protection. In the event that Borrower breaches its
obligation to enter into and maintain an Interest Rate Protection Agreement in full force and
effect as set forth in Section 2.6(a) hereof, or fails to deliver the evidence required
pursuant to Section 2.6(c) hereof as and when required therein, in addition to Agent’s
rights and remedies hereunder or under the other Loan Documents, Agent may, but shall have no
obligation to, at Borrower’s sole cost and expense and on Borrower’s behalf, enter into an Interest
Rate Protection Agreement as may be required pursuant to Section 2.6(a) hereof. In the
event that Agent shall elect to enter into an Interest Rate Protection Agreement on Borrower’s
behalf, such Interest Rate Protection Agreement, at Agent’s election, may be a Lender Interest Rate
Protection Agreement. Agent is hereby irrevocably appointed the true and lawful attorney of



30









 






Borrower (coupled with an interest), in its name and stead, to execute such an Interest Rate
Protection Agreement and all necessary documents ancillary thereto in the event that Borrower
breaches its obligation to enter into and maintain an Interest Rate Protection Agreement in full
force and effect as set forth in Section 2.6(a) hereof or breaches its obligation to
deliver to Agent the evidence required pursuant to Section 2.6(c) hereof as and when
required therein and during the continuance of either of such breaches, and for that purpose Agent
may execute all necessary agreements and instruments, and may substitute one or more persons with
like power, Borrower hereby ratifying and confirming all that its said attorney or such substitute
or substitutes shall lawfully do by virtue hereof. All sums paid and liabilities incurred by Agent
pursuant to this Section 2.6 shall be paid by Borrower (and not from the proceeds of the
Loan) within five (5) Business Days after Agent’s demand with interest at the Default Rate to the
date of payment to Agent and such sums and liabilities, including such interest, shall be deemed
and shall constitute advances under this Loan Agreement and be evidenced by the Note and be secured
by the Loan Documents.




          (e) Obligation of Borrower Unaffected by Interest Rate Protection Agreement. No Interest Rate
Protection Agreement shall alter, impair, restrict, limit or modify in any respect the obligation
of Borrower to pay Interest or Additional Interest on the Loan as and when the same becomes due and
payable in accordance with the provisions of the Loan Documents.




          (f) Termination, etc. of Interest Rate Protection Agreement. Borrower shall not terminate,
modify, cancel or surrender, or permit the termination, modification, cancellation or surrender of,
any Interest Rate Protection Agreement without the prior consent of Agent (provided that a
modification the sole effect of which is to reflect a reduction in the notional amount by the
amount of any prepayment of the Loan made in accordance with the terms hereof shall not require
Agent’s consent). Within five (5) Business Days after Borrower obtains knowledge of or receipt of
notice (which may be given by Agent or a Lender) of a default by the financial institution that is
a party to any Interest Rate Protection Agreement, Borrower shall substitute for such defaulted
Interest Rate Protection Agreement another Interest Rate Protection Agreement (to which the Person
that defaulted under the defaulted Interest Rate Protection Agreement is not a party) so that,
after giving effect to such substitution, Borrower is in compliance with the requirements of
Section 2.6(a) hereof.




          (g) Receipts from Interest Rate Protection Agreements. All payments due to Borrower pursuant
to any Interest Rate Protection Agreement, including upon any termination thereof, shall be payable
to and held by Agent; provided, however, that all periodic “net payments” and any
other payments due to Borrower so received by Agent in connection with a payment made by the
Counterparty to any Interest Rate Protection Agreement shall be applied by Agent on account of
Interest then due and payable or which becomes due and payable on the Loan. If an Event of Default
occurs, Agent may, in its sole discretion, for so long as such Event of Default is continuing and
in addition to any other rights and remedies hereunder, apply the amounts so held by Agent to the
Loan or other amounts due under the Loan Documents at Agent’s election. Until such time as all
Obligations have been paid in full, Borrower shall have no right to withdraw or otherwise apply any
funds received by Agent on account of any Interest Rate Protection Agreement. Such funds shall
constitute additional security for the Obligations, a security interest therein being granted
hereby. In the event Borrower receives any sums pursuant



31









 






to or in connection with any Interest Rate Protection Agreement, it shall immediately pay such
sums to Agent.




          (h) Security. No Interest Rate Protection Agreement shall be secured by all or any portion of
the Collateral unless it is a Lender Interest Rate Protection Agreement, in which case such Lender
Interest Rate Protection Agreement shall be secured pari passu with the principal
amount of the Loan secured by the Mortgage and the other Loan Documents. In amplification of the
foregoing, in the event that any payment received by Borrower hereunder is insufficient to pay all
amounts due and owing on the date of such payment, such payment shall be applied pari
passu together with any application thereof to the outstanding principal of the Loan.




          SECTION 2.7.    Additional Interest. Borrower shall pay to Agent the following losses, costs and
expenses of Agent or any Lender incurred or estimated by Agent or such Lender, as applicable, to be
incurred:





     (a) all losses, costs and expenses incurred by reason of obtaining, liquidating or
redeploying deposits or other funds acquired by Agent or such Lender to fund or maintain the
Loan, including by means of a prepayment of the Loan, delay or failure to convert the
Applicable Interest Rate to a LIBOR Rate or to prepay the Loan when required hereunder, any
revocation of a notice of prepayment, or otherwise; and




     (b) any sums becoming payable by Borrower pursuant to any Lender Interest Rate
Protection Agreement, including any termination thereof.


In any of the foregoing events, Borrower shall pay to Agent, concurrently with any principal
payment with respect to clause (a) of this Section 2.7 and within five (5) Business
Days after written demand in all other cases, or in the case of any Lender Interest Rate Protection
Agreement, such shorter period as shall be specified therein, such amount as shall equal the amount
of the Additional Interest certified by Agent (or the applicable Lender) to Borrower by reason of
such event. A certificate as to the amount of such Additional Interest submitted by Agent to
Borrower setting forth Agent’s (or the applicable Lender’s) basis for the determination of
Additional Interest shall be conclusive evidence of the amount thereof, absent manifest error.
Failure on the part of Agent to demand payment from Borrower for any Additional Interest
attributable to any particular period shall not constitute a waiver of Agent’s (or the applicable
Lender’s) right to demand payment of such amount for any subsequent or prior period.




          SECTION 2.8.    No Withholdings. All sums payable by Borrower under the Note, this Loan Agreement
and the other Loan Documents, shall be paid in full and without set-off or counterclaims and free
of any deductions or withholdings for any and all present and future taxes, levies, imposts,
deductions, duties, filing and other fees or charges, excluding Excluded Taxes (collectively,
“Taxes”). In the event that Borrower is prohibited by any law from making any such payment
free of such deductions or withholdings with respect to Taxes, then Borrower shall pay such
additional amount to Agent as may be necessary in order that the actual amount received by Lenders
after such deduction or withholding (and after payment of any additional Taxes due as a consequence
of the payment of such additional amount) shall equal the amount that would have been received if
such deduction or withholding were not required;




32









 







provided, however, that Borrower shall not be obligated to pay such additional
amount on account of a specific Lender if at the time such Lender became a “Lender” hereunder,
Borrower is required to deduct or withhold any sums solely because such Lender had a legal basis
to deliver, but failed to deliver, to Borrower (a) a duly executed copy of United States Internal
Revenue Service Form W-8 BEN or W-8 ECI or any successor form or any required renewal thereof, as
the case may be, certifying in each case that such Lender is entitled to receive payments hereunder
or under the other Loan Documents without deduction or withholding of any United States federal
income taxes or (b) a duly executed United States Internal Revenue Service Form W-8 BEN or W-9 or
any successor form or any required renewal thereof, establishing that a full exemption exists from
United States backup withholding tax, and as result of such failure, Borrower was prohibited by the
IRC from making any such payment free of such deductions or withholding. Notwithstanding anything
contained in this Section 2.8, in no event will any Lender’s failure to deliver any such
forms, or any renewal or extension thereof, affect, postpone or relieve Borrower from any
obligation to pay Interest, principal, Additional Interest and other amounts due under the Loan
Documents (other than amounts due under this Section 2.8 as a result of a Lender’s failure
to deliver such forms). Such additional amount shall be due concurrently with the payment with
respect to which such additional amount is owed in the amount of Taxes certified by Agent (or the
applicable Lender). A certificate as to the amount of Taxes submitted by Agent to Borrower setting
forth Agent’s (or the applicable Lender’s) basis for the determination of Taxes shall be conclusive
evidence of the amount thereof, absent manifest error. Failure on the part of Agent to demand
payment from Borrower for any Taxes attributable to any particular period shall not constitute a
waiver of Agent’s (or the applicable Lender’s) right to demand payment of such amount for any
subsequent or prior period.




SECTION 2.9.    Unavailability of LIBOR; Illegality.




          (a) Unavailability of LIBOR. If on any date on which Borrower seeks to establish a LIBOR Rate
as the Applicable Interest Rate pursuant to Section 2.3 hereof or on which a LIBOR Rate
would otherwise apply pursuant to Section 2.3(d) hereof, Agent determines (which
determination shall be conclusive and binding upon Borrower) that (i) Dollar deposits in an amount
approximately equal to the then outstanding principal balance of the Loan Portion bearing interest
at a LIBOR Rate are not generally available at such time in the London interbank Eurodollar market
for deposits in Eurodollars, (ii) reasonable means do not exist for ascertaining LIBOR, or
(iii) the Applicable Interest Rate would be in excess of the maximum interest rate which Borrower
may by law pay, Agent shall promptly give notice (the “Non-Availability Notice”) of such
fact to Borrower and the option to convert to or to continue the Applicable Interest Rate on such
Loan Portion as a LIBOR Rate shall be suspended until such time as such condition no longer exists.
In the event that the option to elect, to convert to or to continue an Applicable Interest Rate as
a LIBOR Rate shall be suspended as provided in this Section 2.11(a), effective upon the
giving of the Non-Availability Notice, and if applicable, effective as of the first date that a
LIBOR Rate Period would otherwise be in effect pursuant to Section 2.3(d) hereof, interest
on the Loan Portion for which a LIBOR Rate was to be determined shall be payable at the Base Rate,
from and including the date of the giving of the Non-Availability Notice (or the date that such
LIBOR Rate Period would otherwise be in effect pursuant to Section 2.3(d) hereof, if
applicable) until the Maturity Date or until any earlier date on which a LIBOR Rate shall become
effective for such Loan Portion pursuant to Section 2.3 hereof



33









 






following the giving of notice by Agent to Borrower that the conditions referred to in this
Section 2.9(a) no longer exist.




          (b) Illegality. In the event that at any time while any Loan Portion bears interest at a
LIBOR Rate, any Lender determines (which determination shall be conclusive and binding on Borrower)
that it is or shall become illegal for such Lender to maintain the Loan or a portion thereof on the
basis of one or more LIBOR Rates, Agent shall promptly after receiving notice thereof from such
Lender give notice of such fact to Borrower, and the option to elect, to convert to or to continue
the Applicable Interest Rate on any Loan Portion as a LIBOR Rate shall be suspended until such time
as such condition shall no longer exist. In the case of existing Loan Portions affected by the
circumstances described in the immediately preceding sentence, the Applicable Interest Rate on such
Loan Portion shall be converted automatically to the Base Rate (unless such Lender determines that
such conversion is not required with respect to any existing Loan Portion) and shall be payable at
the Base Rate in the same manner as provided in Section 2.9(a) hereof.




SECTION 2.10.    Increased Costs and Capital Adequacy.




          (a) Borrower agrees to pay Agent additional amounts as Agent shall determine will compensate
Lenders for costs incurred in maintaining the Loan or any portion thereof outstanding or for the
reduction of any amounts received or receivable as a result of any Regulatory Change (i) changing
the basis of taxation of payments to any Lender (other than taxes imposed on all or any portion of
the overall net income of any Lender by the United States or by any political subdivision or taxing
authority of the United States), (ii) imposing, modifying or applying any reserve, special deposit
or similar requirement against assets of, deposits with or for the account of, credit extended by,
or any other acquisition of funds for loans by any Lender (whether directly, indirectly or on a
portfolio wide basis) or (iii) imposing on any Lender any other condition affecting the Note or the
Loan.




          (b) If any Lender shall determine in good faith that (i) any change after the date hereof in
the application of any law, rule, regulation or guideline adopted or arising out of the June 2006
report of the Basel Committee on Banking Regulations and Supervisory Practices entitled “Basel II:
International Convergence of Capital Measurement and Capital Standards: a Revised Framework -
Comprehensive Version,” or any change in the interpretation or administration thereof by any
domestic or foreign governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, (ii) any change in or adoption of after the date hereof
any other law, rule, regulation or guideline regarding capital adequacy, or (iii) compliance by any
Lender, or any lending office of any Lender, or the holding company of any Lender, with any request
or directive regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency based on any such change or adoption, has or would
have the effect of reducing the rate of return on any Lender’s capital to a level below that which
such Lender would have achieved but for such adoption, change or compliance (taking into
consideration the policies of such Lender with respect to capital adequacy), then from time to time
Borrower shall pay to Agent such additional amounts as will compensate Lenders for such actual
reduction with respect to any portion of the Loan outstanding.




34









 








          (c) Any amount payable by Borrower pursuant to Section 2.10(a) or (b) hereof
shall be paid to Agent within five (5) Business Days of receipt by Borrower of a certificate of
Agent setting forth the amount due and Agent’s basis for the determination of such amount, which
statement shall be conclusive and binding upon Borrower, absent manifest error. Failure on the
part of Agent to demand payment from Borrower for any such amount attributable to any particular
period shall not constitute a waiver of Agent’s right to demand payment of such amount for any
subsequent or prior period.




          SECTION 2.11.    Usury. The Note, this Loan Agreement, the Mortgage, and the other Loan Documents
are subject to the express condition that at no time shall Borrower be obligated or required to pay
interest on the Obligations at a rate which could subject any Lender to either civil or criminal
liability as a result of being in excess of the maximum interest rate which Borrower is permitted
by law to contract for or to agree to pay. If by the terms of the Note, this Loan Agreement, the
Mortgage or any other Loan Document, Borrower is at any time required or obligated to pay interest
at a rate in excess of such maximum rate, the rate of interest shall be deemed to be immediately
reduced to such maximum rate and, to the extent not prohibited by applicable law, the interest
payments in excess of such maximum rate shall be applied and shall be deemed to have been payments
in reduction of principal.




          SECTION 2.12.    Closing. The Closing shall be held pursuant to an escrow with the Title Company.




          SECTION 2.13.    Fees. Borrower shall pay the fees provided for in the Loan Fee Letter in
accordance with the terms of this Loan Agreement and the Loan Fee Letter.




          SECTION 2.14.    Clearing Account and Lockbox Account.




          (a) Borrower shall cause all Operating Revenues to be paid and deposited directly into the
Lockbox Account or the Clearing Account. Borrower shall also deliver to Agent a Credit Card
Servicer Agreement from each credit card company, servicer or agency used by Borrower and/or
Property Manager, executed by Borrower and/or Property Manager, as applicable, and such credit card
company, servicer or agency promptly after engaging same. If, however, Borrower or Property
Manager for any reason receives Operating Revenues Borrower shall deposit same into the Lockbox
Account or the Clearing Account promptly, but in any event, within two (2) Business Days of
receipt. All available sums on deposit in the Clearing Account shall be swept on a daily basis to
the Lockbox Account. All sums held in the Clearing Account shall constitute additional security
for the Obligations. Borrower hereby grants to Agent and Lenders a security interest in all rights
of Borrower in and to the Clearing Account and all sums on deposit therein as additional security
for the Obligations. Agent shall have sole control over the Clearing Account and neither Borrower
nor any other Person other than Agent shall have any right to, and Borrower covenant that they
shall not, withdraw any amounts from, the Clearing Account. All interest earned on amounts
deposited in the Clearing Account shall be re-deposited therein and become part thereof. No funds
in the Clearing Account may be commingled with any funds of Manager or any other Person. Upon the
occurrence and during the continuation of an Event of Default, Agent shall have the rights and
remedies with respect to the Clearing Account specified in this Loan Agreement or in any other Loan
Document. Neither Agent nor Lenders shall be liable for any loss of interest on or any penalty or
charge assessed



35









 






against the funds in, payable on, or credited to the Clearing Account as a result of the
exercise by Agent of any of its rights, remedies or obligations hereunder or under any other Loan
Document. Borrower shall not close or consent to Property Manager’s closing the Clearing Account
without obtaining the prior consent of Agent. Borrower shall maintain the Clearing Account and
shall pay all fees and charges with respect thereto when due, and shall keep in full force and
effect the Account Agreement with respect thereto. In the event that the Account Agreement
applicable to the Clearing Account is terminated, or the bank or financial institution at which the
Clearing Account is held otherwise no longer acts as the depository thereof, Borrower shall open
another Clearing Account at another bank or financial institution reasonably acceptable to Agent
and, concurrently with opening same, execute and deliver, and cause such bank or financial
institution to execute and deliver, to Agent an Account Agreement with respect thereto.




          (b) All sums on deposit in the Lockbox Account shall be held, disbursed and applied in
accordance with this Loan Agreement and the Cash Management Agreement. All sums held in the
Lockbox Account shall constitute additional security for the Obligations. Borrower hereby grants
to Agent and Lenders a security interest in all rights of Borrower in and to the Lockbox Account
and all sums on deposit therein as additional security for the Obligations. Agent shall have sole
control over the Lockbox Account and neither Borrower nor any other Person other than Agent shall
have any right to, and Borrower covenant that they shall not, withdraw any amounts from, the
Lockbox Account. All interest earned on amounts deposited in the Lockbox Account shall be
re-deposited therein and become part thereof. No funds in the Lockbox Account may be commingled
with any funds of Property Manager or any other Person. Upon the occurrence and during the
continuation of an Event of Default, Agent shall have the rights and remedies with respect to the
Lockbox Account specified in this Loan Agreement or in any other Loan Document. Neither Agent nor
Lenders shall be liable for any loss of interest on or any penalty or charge assessed against the
funds in, payable on, or credited to the Lockbox Account as a result of the exercise by Agent of
any of its rights, remedies or obligations hereunder or under any other Loan Document. Borrower
shall not close or consent to Property Manager’s closing the Lockbox Account without obtaining the
prior consent of Agent. Borrower shall maintain the Lockbox Account and shall pay all fees and
charges with respect thereto when due. In the event that the Cash Management Agreement is
terminated, or the Depositary otherwise no longer acts as the cash management bank thereunder,
Borrower shall open another Lockbox Account at another bank or financial institution reasonably
acceptable to Agent and, concurrently with opening same, execute and deliver, and cause such bank
or financial institution to execute and deliver, to Agent an agreement in substitution of the Cash
Management Agreement in substantially the same form, and otherwise reasonably acceptable to Agent.




          (c) All sums held in the Operating Account and the GM Account shall constitute additional
security for the Obligations. Borrower hereby grants to Agent and Lenders a security interest in
all rights of Borrower in and to the Operating Account and the GM Account and all sums on deposit
in each of said Accounts as additional security for the Obligations. Agent shall have sole control
over the Operating Account and the GM Account subject to the terms of this Section 2.14(c).
Borrower and Property Manager may from time to time make withdrawals from the Operating Account
and the GM Account to pay Operating Expenses, to make distributions to or repay loans permitted
hereunder from Borrower’s members, to pay for alterations and other Capital Expenditures and FF&E
Expenditures and for any other purposes of



36









 






Borrower, subject, however, to any limitations and prohibitions on withdrawals and use of
funds set forth in this Loan Agreement and the other Loan Documents (and to transfer funds from the
Operating Account to the GM Account for the purposes of paying the foregoing items, subject,
however, to the provisions of this Section 2.14(c)). All interest earned on amounts
deposited in the Operating Account and the GM Account shall be re-deposited therein and become part
thereof. No funds in the Operating Account or the GM Account may be commingled with any funds of
Property Manager or any other Person. Upon the occurrence and during the continuation of an Event
of Default, Agent shall have the rights and remedies with respect to the Operating Account and the
GM Account specified in this Loan Agreement or in any other Loan Document. Neither Agent nor
Lenders shall be liable for any loss of interest on or any penalty or charge assessed against the
funds in, payable on, or credited to the Operating Account or the GM Account as a result of the
exercise by Agent of any of its rights, remedies or obligations hereunder or under any other Loan
Document. Borrower shall not close or consent to Property Manager’s closing the Operating Account
without obtaining the prior consent of Agent. Borrower shall maintain the Operating Account and
shall pay all fees and charges with respect thereto when due. In the event that the Account
Agreement applicable to the Operating Account is terminated, or the bank or financial institution
at which the Operating Account is held otherwise no longer acts as the depository thereof, Borrower
shall open another Operating Account at another bank or financial institution acceptable to Agent
and, concurrently with opening same, execute and deliver, and cause such bank or financial
institution to execute and deliver, to Agent an Account Agreement with respect thereto. Borrower
represents to Agent and Lenders that as of the Closing Date, the balance of the GM Account does not
exceed $20,000. Borrower agrees that the balance of the GM Account shall not exceed $20,000
(unless an Account Agreement is in effect with respect to the GM Account at all times that the
balance thereof exceeds $20,000). Borrower shall not close or consent to Property Manager’s
closing the GM Account, shall maintain the GM Account and shall pay all fees and charges with
respect thereto when due, provided, however, that Borrower may close or consent to Property
Manager’s closing the GM Account without obtaining the prior consent of Agent so long as the
balance thereof does not exceed $20,000 and such balance is transferred to the Operating Account
upon the closing of the GM Account. Borrower may not open another Account in replacement of the GM
Account without obtaining the prior consent of Agent.




          SECTION 2.15.    Tenant Security Account.




          (a) Borrower shall comply with all Legal Requirements and the applicable Lease applicable to
any security given under any Lease. Subject to the foregoing, Borrower shall deposit or cause to
be deposited all Security Deposits under Major Leases into the Tenant Security Account within two
(2) Business Days after receipt. Prior to accepting any Security Deposit under any Major Lease, if
a Tenant Security Account shall not have been opened or an Account Agreement with respect thereto
shall not be in effect, Borrower shall open a Tenant Security Account and deliver to Agent an
Account Agreement executed by Borrower and the bank or other financial institution where said
Account is held with respect to such Account.




          (b) Borrower shall not withdraw any sums from the Tenant Security Account or apply any
security deposits if an Event of Default has occurred and is continuing. Borrower may make
withdrawals from the Tenant Security Account at such time as no Event of Default has occurred and
is continuing provided the proceeds are (i) applied in the ordinary course of



37









 






business to sums due under the applicable Major Lease when the terms of such Major Lease or
applicable Legal Requirements permit the application thereof or (ii) returned to the applicable
Lessee pursuant to Legal Requirements or the terms of the applicable Major Lease which require
Borrower to return such other Security Deposit. Upon the occurrence and during the continuation of
an Event of Default, neither Borrower nor any other Person shall have any right to, and Borrower
covenants that it shall not, withdraw any amounts from the Tenant Security Account or apply any
Security Deposits, except as may be approved by Agent. In the event an Event of Default exists but
Borrower is required pursuant to the terms of the applicable Lease or applicable Legal Requirements
to return any Security Deposit to the applicable Lessee, Borrower shall deliver a notice to Agent
certifying same and stating the reason therefor. Agent shall, at Agent’s option and at Borrower’s
sole cost and expense, either permit Borrower to return the Security Deposit to the applicable
Lessee or, if Agent elects with respect to any Major Lease, cause such Security Deposit to be
returned directly to the applicable Lessee.




          (c) All sums on deposit in the Tenant Security Account shall be held, disbursed and applied in
accordance with this Loan Agreement. All sums held in the Tenant Security Account shall constitute
additional security for the Obligations. Borrower hereby grants to Agent and Lenders a security
interest in all rights of Borrower in and to the Tenant Security Account and all sums on deposit
therein as additional security for the Obligations. Agent shall have sole control over the Tenant
Security Account and neither Borrower nor any other Person other than Agent shall have any right
to, and Borrower covenant that they shall not, withdraw any amounts from, the Tenant Security
Account except as provided in this Section 2.15. All interest earned on amounts deposited
in the Tenant Security Account shall be re-deposited therein and become part thereof. No funds in
the Tenant Security Account may be commingled with any funds of Manager or any other Person or any
other funds of Borrower. Upon the occurrence and during the continuation of an Event of Default,
Agent shall have the rights and remedies with respect to the Tenant Security Account specified in
this Loan Agreement or in any other Loan Document. Neither Agent nor Lenders shall be liable for
any loss of interest on or any penalty or charge assessed against the funds in, payable on, or
credited to the Tenant Security Account as a result of the exercise by Agent of any of its rights,
remedies or obligations hereunder or under any other Loan Document. Borrower shall not close or
consent to Property Manager’s closing the Tenant Security Account without obtaining the prior
consent of Agent, which Agent shall provide at Borrower’s request if there ceases to be any
Security Deposit under any Major Lease. Except as provided in the immediately preceding sentence,
Borrower shall maintain the Tenant Security Account and shall pay all fees and charges with respect
thereto when due. In the event that the Account Agreement applicable to the Tenant Security
Account is terminated, or the bank or financial institution at which the Tenant Security Account is
held otherwise no longer acts as the depository thereof, Borrower shall open another Tenant
Security Account at another bank or financial institution reasonably acceptable to Agent and,
concurrently with opening same, execute and deliver, and cause such bank or financial institution
to execute and deliver, to Agent an Account Agreement with respect thereto.




          SECTION 2.16.    FF&E Reserve Account.




          (a) On each Payment Date, and in addition to all other amounts then due and owing, Borrower
shall deposit into the FF&E Reserve Account the FF&E Reserve Amount for the second (2nd) calendar
month immediately prior to such Payment Date (e.g., the payment due



38









 






on May 1, 2010 shall be the FF&E Reserve Amount for March, 2010). Borrower shall cause all
sums on deposit in the FF&E Reserve Account to be deposited into the Lockbox Account upon the
demand of Agent at any time that a Cash Sweep Condition exists.




          (b) All sums held in the FF&E Reserve Account shall constitute additional security for the
Obligations. Borrower hereby grants to Agent and Lenders a security interest in all rights of
Borrower in and to the FF&E Reserve Account and all sums on deposit therein as additional security
for the Obligations. Agent shall have sole control over the FF&E Reserve Account and neither
Borrower nor any other Person other than Agent shall have any right to, and Borrower covenants that
they shall not, withdraw any amounts from, the FF&E Reserve Account upon the occurrence and during
the continuance of an Event of Default. At all other times, and subject to the other terms and
conditions of the Loan Documents, Borrower may withdraw sums from the FF&E Reserve Account to pay
FF&E Expenditures. All interest earned on amounts deposited in the FF&E Reserve Account shall be
re-deposited therein and become part thereof. No funds in the FF&E Reserve Account may be
commingled with any funds of Property Manager or any other Person. Upon the occurrence and during
the continuation of an Event of Default, Agent shall have the rights and remedies with respect to
the FF&E Reserve Account specified in this Loan Agreement or in any other Loan Document. Neither
Agent nor Lenders shall be liable for any loss of interest on or any penalty or charge assessed
against the funds in, payable on, or credited to the FF&E Reserve Account as a result of the
exercise by Agent of any of its rights, remedies or obligations hereunder or under any other Loan
Document. Borrower shall not close or consent to Property Manager’s closing the FF&E Reserve
Account without obtaining the prior consent of Agent. Borrower shall maintain the FF&E Reserve
Account and shall pay all fees and charges with respect thereto when due. In the event that the
Account Agreement applicable to the FF&E Reserve Account is terminated, or the bank or financial
institution at which the FF&E Reserve Account is held otherwise no longer acts as the depository
thereof, Borrower shall open another FF&E Reserve Account at another bank or financial institution
reasonably acceptable to Agent and, concurrently with opening same, execute and deliver, and cause
such bank or financial institution to execute and deliver, to Agent an Account Agreement with
respect thereto.




          SECTION 2.17.    Return of Funds in Accounts(a) . When the obligations of the parties to this
Loan Agreement are terminated in accordance with Section 6.10 hereof, Agent shall notify
the banks or other financial institutions that are party to the Account Agreements that Agent’s
security interest no longer applies to the Accounts under such Account Agreements and that such
Account Agreements should be terminated, and direct such banks to release the funds therein as
Borrower may direct.




          SECTION 2.18.    Fees. Borrower shall pay to the fees provided for in the Loan Fee Letter in
accordance with the terms of this Loan Agreement and the Loan Fee Letter.




          SECTION 2.19.    Changes in Law Regarding Taxation of Property. In the event of the passage after
the Closing Date of any law deducting from the value of real property for the purpose of taxation
any lien or encumbrance thereon or changing in any way the laws for the taxation of deeds of trust,
mortgages or debts secured by deeds of trust or mortgages or the manner of the collection of any
such taxes, and imposing a tax, either directly or indirectly, on any Note, the Mortgage or any
other Loan Document, Borrower shall pay any tax imposed as a



39









 






result of any such law, plus such amount as shall be sufficient to compensate Lenders for any tax
imposed upon it in consequence of any such payment within ten (10) days after demand by Agent,
provided, that if, in the opinion of Agent’s Counsel, Borrower is not permitted by law to
pay such taxes, Agent shall have the right, at its option, by notice to Borrower, to declare the
Loan to be and become due and payable not less than ninety (90) days after the giving of such
notice, without penalty or prepayment fees.




ARTICLE III




CONDITIONS PRECEDENT TO THE

EFFECTIVENESS OF THIS LOAN AGREEMENT




          This Loan Agreement shall not be effective until the following conditions shall have been
satisfied, except to the extent that Agent may elect (which election may be made without written or
express notice of such waiver) to waive any such conditions:




          SECTION 3.1.    Representations and Warranties. The representations and warranties made by
Borrower and Guarantor in the Loan Documents and in each certificate, document, or financial or
other statement furnished by Borrower or Guarantor pursuant to or in connection therewith, shall be
true and correct on and as of the Closing Date.




          SECTION 3.2.    Receipt of Items and Documents by Agent. Agent shall have received and approved
the following items and documents, duly executed and in recordable form where applicable, in each
case in form and substance satisfactory to Agent:




          (a) a pro forma Title Policy;




          (b) the Survey;




          (c) all Leases in effect as of the Closing Date, and if required by Agent, estoppel
certificates from all Lessees and subordination, non-disturbance and attornment agreements with all
Lessees whose Leases by their terms are not subordinate to the Mortgage;;




          (d) current UCC, judgment, bankruptcy and other search reports with respect to Borrower,
Guarantor and such other Persons as Agent may require;




          (e) unless such information is indicated on the Survey, a certificate from a licensed surveyor
or an insurance broker that the Premises are not located in a flood hazard plain as indicated on
the maps of the Federal Emergency Management Agency;




          (f) the Environmental Report (and, if such report is not addressed to Agent, a reliance letter
for same addressed to Agent), a property condition report and a geotechnical report (and, if such
reports are not addressed to Agent, reliance letters for same addressed to Agent);




          (g) the tax identification number, organizational identification number, and social security
number (as applicable) for each of Borrower, Guarantor and such direct or indirect beneficial or
equitable owners of Borrower as requested by Agent




40









 








          (h) an organizational chart with respect to Borrower; copies of all organizational and
authorizing documents of Borrower and Guarantor; evidence of the good standing of Borrower and
Guarantor in their jurisdiction of organization; and evidence of the good standing/qualification to
do business in the jurisdiction in which the Premises are located;




          (i) copies of all licenses, easements, plats or other agreements or instruments pertaining to
the Premises and all other Permitted Encumbrances and Premises Documents;




          (j) copies of Operating Agreements;




          (k) the Insurance Policies and copies, certificates of insurance or other evidence of the
Insurance Policies satisfactory to Agent, together with evidence that:




               (i) all such Insurance Policies then have an unexpired term acceptable to Agent;



               (ii) the premiums then due have been paid in full; and



               (iii) such Insurance Policies are in full force and effect;



          (l) a letter or report of Agent’s insurance consultant concerning Borrower’s compliance with
the requirements of this Loan Agreement as to the Insurance Policies and such other matters
pertaining to insurance as Agent may require;




          (m) evidence satisfactory to Agent that the Land and the Premises comply with all Legal
Requirements and that, to the extent required by Legal Requirements to be in effect, all Operating
Permits are in full force and effect;




          (n) an Appraisal indicating a Loan-to-Value Ratio of no more than sixty percent (60%);




          (o) certified copies of the balance sheets and other financial statements of Borrower,
Guarantor and the Premises as Agent shall require, and completion of Agent’s review of the
financial condition of Borrower, Guarantor and the Premises;




          (p) a certified copy of the Management Agreement;




          (q) a certified copy of the Franchise Agreement;




          (r) the Franchise Comfort Letter;




          (s) copies of official photographic identification (passport or driver’s license) of the
individuals who sign on behalf of Borrower and Guarantor, and such other principals of those
Persons as Agent requires, certified by Borrower’s attorney or a notary public as true and correct
copies;




          (t) opinions in form, substance and scope satisfactory to Agent and Agent’s counsel from
counsel satisfactory to Agent as to such matters as Agent shall request; and




41









 








          (u) such other documents, instruments, reports, opinions, estoppel certificates and approvals
as Agent or Agent’s Counsel may require.




          SECTION 3.3.    Closing Documents, Etc. Agent shall have received fully executed and, where
appropriate, acknowledged counterparts of this Loan Agreement, each of the other Loan Documents and
all other documents, agreements, instruments, certificates and other items which are expressly
required under the Loan Documents or Agent shall otherwise require, each of which shall be dated as
of the Closing Date, unless otherwise expressly stated (all of which shall be in such form,
substance and content as Agent shall require).




          SECTION 3.4.    Payment of Fees and Expenses. Agent shall have received payment of all fees and
expenses required to be paid pursuant to the Loan Fee Letter, this Loan Agreement or the other Loan
Documents, including Section 5.15 hereof.




          SECTION 3.5.    Adverse Conditions; Internal Approval. Agent shall be satisfied that there has
been no material disruption or material adverse change in financial, banking, real estate or
capital market conditions, and shall have received all internal underwriting approvals to make the
Loan and otherwise pertaining to Borrower and all other relevant parties.




ARTICLE IV




REPRESENTATIONS AND WARRANTIES




          To induce Lenders to make the Loan and Lenders and Agent to enter into this Loan Agreement and
to perform Lenders’ and Agent’s obligations hereunder, Borrower hereby represents and warrants to
Agent and Lenders as follows as of the date hereof (which representations and warranties shall
survive the execution and delivery of this Loan Agreement and the other Loan Documents, regardless
of any investigation made by Agent or Lenders or on its or their behalf).




          SECTION 4.1.    Due Organization Borrower is a Delaware limited liability company duly organized
and validly existing under the laws of the state of its formation and duly qualified to do business
in the State where the Premises are located. Borrower has all necessary power and authority to own
its properties and to conduct its business as presently conducted or proposed to be conducted and
to enter into and perform its obligations under this Loan Agreement and the other Loan Documents to
which it is a party, and all other agreements and instruments to be executed by Borrower in
connection herewith and therewith. Attached to the Borrower’s Certificate is a true and correct
organizational chart of Borrower, and the information shown thereon is true and correct, as of the
Closing Date.




          SECTION 4.2.    Due Execution. This Loan Agreement and the other Loan Documents to which Borrower
is a party have been duly executed and delivered, and all necessary actions have been taken to
authorize Borrower to perform its obligations hereunder and thereunder.




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          SECTION 4.3.    Enforceability. This Loan Agreement and the other Loan Documents to which Borrower
is a party constitute legal, valid and binding obligations of Borrower.




          SECTION 4.4.    No Violation. The consummation of the transactions herein contemplated, the
execution and delivery of this Loan Agreement, the other Loan Documents to which Borrower is a
party, and all other agreements and instruments to be executed by Borrower in connection herewith
and therewith, and the performance by Borrower of its obligations hereunder and thereunder, do not
and will not (a) violate any Legal Requirement, (b) result in a breach of any of the terms,
conditions or provisions of, or constitute a default under any mortgage, deed of trust, indenture,
agreement, permit, franchise, license, note or instrument to which Borrower or any Affiliate of
Borrower is a party or by which it or any of its properties is bound, (c) result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the assets of
Borrower or any Affiliate of Borrower (except as contemplated by this Loan Agreement and by the
other Loan Documents), or (d) violate any provision of the Borrower Operating Agreement or other
organizational documents of Borrower. Borrower is not in default with respect to any Legal
Requirement relating to its formation or organization.




          SECTION 4.5.    No Litigation. Other than “slip-and-fall” and other routine claims ordinarily made
in the normal course of operating the Premises which, if adversely determined, would reasonably
likely have no Material Adverse Effect and are covered by Borrower’s insurance and with respect to
which the insurer has not denied coverage or refused to defend and immaterial contract disputes
involving Borrower and its contractors or service suppliers ordinarily made in the normal course of
operating the Premises which, if adversely determined, would reasonably likely have no Material
Adverse Effect, and further except as set forth on Schedule 4.5 attached hereto or in
Guarantor’s most recent 10-Q filing with the Securities and Exchange Commission, there are no
actions, suits or proceedings at law or in equity or before or instituted by any Governmental
Authority (a) pending or, to Borrower’s knowledge, threatened against or affecting Borrower,
Guarantor, the Premises, the Collateral or any part thereof (including any condemnation or eminent
domain proceeding against the Premises, or any part thereof) or (b) pending or, to Borrower’s
knowledge, threatened, which affect or might affect the validity or enforceability of any Security
Document (or the priority of the lien thereof), or any of the Loan Documents.




          SECTION 4.6.    No Default or Event of Default. No Default or Event of Default has occurred and is
continuing.




          SECTION 4.7.    Offsets, Defenses, Etc. Borrower has no offsets, defenses or counterclaims against
its obligations under the Loan Documents, any and all such offsets, defenses and counterclaims, if
any, being waived by Borrower.




          SECTION 4.8.    Consents. All consents, approvals, orders or authorizations of, or registrations,
declarations or filings with, or other actions with respect to or by, any Governmental Authorities
or any party to any Permitted Encumbrance that are required in connection with the valid execution,
delivery and performance by Borrower of this Loan Agreement, the other Loan Documents and all other
agreements and instruments to be executed



43









 






by Borrower in connection herewith or therewith have been obtained and are in full force and
effect.




          SECTION 4.9.    Financial Statements and Other Information. All statements of financial condition
and related schedules of Borrower and Guarantor heretofore delivered to Agent are true, correct and
complete in all material respects, fairly present the financial conditions of the subjects thereof
as of the respective dates thereof, and without limiting the foregoing, reflect all direct and
contingent liabilities of Borrower and Guarantor, and have been prepared in accordance with GAAP.
Title to all assets listed in such statements and schedules of Borrower are held solely in the name
of Borrower, and no other Person has an interest therein. No material adverse change has occurred
in the financial conditions reflected in the most recent of the aforesaid statements of financial
condition and related schedules since the respective dates thereof. Neither the aforesaid
statements of financial condition and related schedules nor any certificate, statement, document or
information furnished to Agent, Agent’s Counsel or to any other Person at the request of Agent by
or on behalf of Borrower, Guarantor or any Affiliate of Borrower or Guarantor in connection with or
related to the transactions contemplated hereby, nor any representation nor warranty in this Loan
Agreement or any other Loan Document, contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained therein or herein not
misleading in any material respect.




          SECTION 4.10.    Full Disclosure. There is no material fact known to Borrower or Guarantor
pertaining to Borrower, Guarantor, the Premises or the other Collateral that Borrower has not
disclosed to Agent that would or is reasonably likely to have a Material Adverse Effect.




          SECTION 4.11.    Accounts. All accounts of Borrower or of any other Person, including Agent, held
on behalf of or for the benefit of Borrower which are required to be established pursuant to this
Loan Agreement or any other Loan Document and which are not held at Agent, including the account
number of each Account and the name and address of the financial institution at which each Account
is held, are as set forth on Schedule 4.11 attached hereto. Borrower has no other accounts
except those held at Agent and those set forth on said schedule.




          SECTION 4.12.    Indebtedness. Borrower is not currently indebted or in contract for any
Indebtedness, and is not otherwise liable in respect of any Indebtedness, other than Permitted
Indebtedness and is not holding out its credit as being available to satisfy the obligations of any
other Person.




          SECTION 4.13.    Insurance Policies. The Insurance Policies required to be maintained pursuant to
this Loan Agreement are in full force and effect and reflect that Agent and Lenders are properly
endorsed in accordance with Schedule 5.11 hereof. Such Insurance Policies satisfy the
requirements set forth in Schedule 5.11 hereof and the premiums for the Insurance Policies
have been paid in full.




          SECTION 4.14.    Availability of Utilities and Access. Except as shown on the Survey, all utility
services and facilities necessary for the current operation, use and occupancy of the Premises in
accordance with this Loan Agreement, are available at the boundaries of the



44









 






Premises, including water supply, storm and sanitary sewer facilities, gas and electric and
telephone facilities. The Premises have direct physical access to and from at least one public
road.




          SECTION 4.15.    No Liens. Except for the Loan Documents, Borrower has not made, assumed or been
assigned any contract or arrangement of any kind, the performance of which by the other party
thereto would give rise to a Lien against all or any portion of the Collateral. There exists no
Lien on any direct or indirect equity or beneficial interest in Borrower other than any Lien which
would be permitted hereunder.




          SECTION 4.16.    Compliance with Legal Requirements. The Legal Requirements, including zoning
ordinances and regulations, permit (a) the existing operation, use and occupancy of the Premises,
and (b) except as shown on the Survey or in the Zoning Report, the Premises to be restored and such
operation, use and occupancy to be continued following a Casualty or Taking, in each case, on an
as-of-right basis and without need of any variance, special use permit or similar exception. All
Operating Permits for the existing operation, use and occupancy of the Premises have been obtained
and are in full force and effect and all conditions to the continued effectiveness of such permits
have been satisfied in all material respects. There are no pending or, to Borrower’s knowledge,
threatened actions, suits or proceedings to revoke, attach, invalidate, rescind or modify the
ordinances and regulations currently in effect and to which the Premises are subject or any of the
Operating Permits. Borrower, the Premises and the existing operation, use and occupancy thereof
comply in all material respects with all Legal Requirements, including all applicable zoning
ordinances and regulations and building codes.




          SECTION 4.17.    Certain Agreements. Borrower has delivered to Agent true, correct and complete
copies of all unrecorded Permitted Encumbrances, the Management Agreement, the Franchise Agreement,
all Premises Documents, and all Material Operating Agreements. No default in any material respect
by Borrower exists under any of the foregoing documents, and no event exists which, with the giving
of notice or passage of any cure period, or both, would constitute a default in any material
respect by Borrower under any of the foregoing documents. Each of the Management Agreement, the
Franchise Agreement, the Material Operating Agreements, the Premises Documents and the Permitted
Encumbrances is in full force and effect. To Borrower’s knowledge, there are no offsets, claims or
defenses to the enforcement by Borrower of the Management Agreement, the Franchise Agreement, any
Material Operating Agreement, any Premises Document or any Permitted Encumbrance presently
outstanding. Borrower has not received a notice of default under any of the foregoing documents
which remains outstanding. To Borrower’s knowledge, no default by any party (other than Borrower)
to the Management Agreement, the Franchise Agreement, any Material Operating Agreement, any
Premises Document or any Permitted Encumbrance in any material respect exists under any of the
foregoing documents, and no grounds for termination by any such party exists, and no event exists
which, with the giving of notice or passage of any cure period, or both, would constitute a default
in any material respect by any such party under any Lease or give rise to any right of any such
party to terminate any of the foregoing documents. There are no Operating Agreements which are
Material Operating Agreements except for those set forth on Schedule 4.17 attached hereto.
The Management Agreement represents the entire agreement between Borrower and Property Manager with
respect to the management of the Premises, and there are no other agreements or representations,
written or oral, between Borrower and Property



45









 






Manager with respect to thereto. The Franchise Agreement represents the entire agreement between
Borrower and Franchisor with respect to the hotel franchise for the Premises, and there are no
other agreements or representations, written or oral, between Borrower and Franchisor with respect
to thereto (other than as set forth in the Franchisor Comfort Letter). Borrower has obtained all
consents necessary to collaterally assign the Management Agreement, the Franchise Agreement, the
Operating Agreements, the Premises Documents and the Permitted Encumbrances to Agent pursuant to
the Loan Documents. No agreement to which Borrower is a party or by which it or any of the
Mortgaged Property is bound contains any option to purchase or right of first refusal in favor of
any party other than Borrower to purchase the Mortgaged Property or any part thereof.




          SECTION 4.18.    Security Documents. The provisions of each Security Document are effective to
create, in favor of Agent for the benefit of itself and Lenders, a legal, valid and enforceable
Lien on or security interest in all of the collateral described therein, and when the appropriate
recordings and filings have been effected in public offices, each of the Security Documents will
constitute a perfected Lien on and security interest in all right, title, estate and interest in
the collateral described therein, prior and superior to all other Liens, except as permitted under
the Loan Documents.




          SECTION 4.19.    Casualty and Taking. No Casualty has occurred to any portion of the Premises
which has not been fully restored. No Taking of any portion of the Premises, or modification,
realignment or relocation of any streets or roadways abutting the Premises or denial of access to
the Premises from any point of access (public or private), has occurred during Borrower’s ownership
of the Premises or, to Borrower’s knowledge, is threatened or pending.




          SECTION 4.20.    Brokerage. Borrower has not dealt with any brokers or “finders” in connection
with the Loan other than Cushman & Wakefield (“Broker”), and no brokerage or “finders” fees
or commissions are payable by or to any Person other than Broker, in connection with the Loan.
Borrower has paid in full all fees, commissions and any and all other compensation due to Broker in
connection with the transaction on or prior to the Closing Date.




          SECTION 4.21.    Encroachments. Other than as disclosed on the Survey, the Premises do not
encroach upon any building line, setback line, side yard line, any Permitted Encumbrance or any
other recorded easement or any visible easement or other easement of which Borrower is aware or has
reason to believe may exist, except in the case of immaterial encroachments which are permitted
pursuant to the Permitted Encumbrances currently in effect, or encroach over any property line of
the Land.




          SECTION 4.22.    Foreign Person. Borrower is not a “foreign person” within the meaning of
Section 1445 or 7701 of the IRC.




          SECTION 4.23.    Control Person. Borrower is not, and no Person having “control” (as that term is
defined in 12 U.S.C. § 375b or in regulations promulgated pursuant thereto) of Borrower is, an
“executive officer,” “director,” or “person who directly or indirectly or in concert with one or
more persons, owns, controls, or has the power to vote more than ten percent (10%) of any class of
voting securities” (as those terms are defined in 12 U.S.C. § 375b



46









 






or in regulations promulgated pursuant thereto) of any Lender, of a bank holding company of which
any Lender is a subsidiary, or of any other subsidiary of a bank holding company of which any
Lender is a subsidiary.




          SECTION 4.24.    Government Regulation. Borrower is not an “investment company” or a company
“controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940.
Borrower is not engaged principally, or as one of its important activities, in the business of
extending, or arranging for the extension of, credit for the purpose of “purchasing or carrying any
margin stock,” within the meaning of Regulation U of the Board of Governors. No portion of the
assets of Borrower consists of any such margin stock, and no part of the proceeds of the Loan shall
be used to purchase or carry any such margin stock within the meaning of said regulation or to
extend credit to others for such purpose.




          SECTION 4.25.    ERISA. None of the assets of Borrower constitute or will constitute “plan assets”
within the meaning of 29 C.F.R. § 2510.3-101; and Borrower is not nor will it be a “governmental
plan” within the meaning of § 3(3) of ERISA. Borrower has no obligation, contingent or otherwise,
with respect to any Pension Plan, Multiemployer Plan or other employee benefit plan within the
meaning of § 3(3) of ERISA. Each employee benefit plan of Borrower that is intended to qualify
under § 401 of the IRC does so qualify, and any trust created thereunder is exempt from tax under
the provisions of § 401 of the IRC. Each Pension Plan is in compliance in all material respects
with all applicable provisions of ERISA, the IRC and other requirements of applicable law. There
has been no, nor is there reasonably expected to occur any, ERISA Event. No Pension Plan has any
unfunded pension liability. Neither Borrower nor any ERISA Affiliate would have any Withdrawal
Liability as a result of a complete withdrawal as of the date hereof from any Multiemployer Plan
that could reasonably be expected to have a Material Adverse Effect.




          SECTION 4.26.    Labor Relations. Borrower is not a party to any collective bargaining agreement.
There are no material grievances, disputes or controversies with any union or any other
organization of employees at the Premises, including employees of Borrower, or threats of strikes,
work stoppages or any asserted pending demands for collective bargaining by any union or
organization.




          SECTION 4.27.    Name; Principal Place of Business. Except as provided in the Franchise Agreement,
Borrower does not use nor will Borrower use any trade name and has not done nor will it do business
under any name other than Borrower’s actual name set forth herein. The principal place of business
and chief executive office of Borrower is as stated in the first paragraph of this Loan Agreement.
Borrower’s books of accounts and records are located at its executive office or its chief place of
business.




          SECTION 4.28.    Intellectual Property. Except as provided in the Franchise Agreement, as of the
date hereof, the name for the Premises used by Borrower in its marketing material is not a
registered trademark. Borrower shall notify Agent of any trademark owned by Borrower. Agent may
make any filing, at Borrower’s sole cost and expense, with the United States Patent and Trademark
Office or otherwise in order to obtain and perfect a security interest in all trademarks owned by
Borrower. To Borrower’s knowledge, there exists no claim by any Person that contests or questions
Borrower’s right to use all applicable patents, trademarks,



47









 






copyrights, technology, know-how and processes necessary for the conduct of the business and the
operation of the Premises substantially in the manner as contemplated to be conducted and operated.
To Borrower’s knowledge, there are no claims against Borrower, and to Borrower’s knowledge, there
is no infringement of the rights of any Person by Borrower, arising from the use of patents,
trademarks, copyrights, technology, know-how and processes by Borrower. To Borrower’s knowledge,
there is no infringement by any third party on any rights of Borrower in any of its intellectual
property. No name or logo used by Borrower in connection with the Premises or any part thereof or
business therein is a registered tradename or trademark, other than tradenames or trademarks
registered by, licensed to or otherwise properly used by Borrower without infringement (including
those provided in the Franchise Agreement) and those owned or used by Lessees, contractors and
others in connection with their businesses at the Premises.




          SECTION 4.29.    Flood Zone. Other than as disclosed on the Survey or in any flood hazard
certificate delivered to Agent, neither the Premises nor any portion thereof is located within an
area that has been designated or identified as an area having special flood hazards by the
Secretary of Housing and Urban Development or by such other official as shall from time to time be
authorized by federal or state law to make such designation pursuant to the National Flood
Insurance Act of 1968, as such act may from time to time be amended, or pursuant to any other
national, state, county or city program of flood control.




          SECTION 4.30.    Condition of Property. Except as set forth in the Engineering Report, the
Improvements and Personal Property forming a part of the Premises are in good condition and repair
in all material respects. Except as set forth in the Engineering Report, there is no patent or, to
the Borrower’s knowledge, latent, material structural or other material defect or deficiency in the
Improvements or Personal Property.




          SECTION 4.31.    Taxes. All tax returns required to be filed by Borrower in any jurisdiction have
been filed and all taxes, assessments, fees, and other governmental charges upon Borrower or upon
any of its properties, income or franchises have been paid that are required to be paid prior to
the time that the non-payment of such taxes could give rise to a lien (other than a lien not yet
due and payable for which Borrower has reserved the allocable amount thereof over the applicable
tax period) on any asset of Borrower, unless such tax, assessment, fee or charge is being contested
in accordance with Section 5.8 hereof. To Borrower’s knowledge, there is no material
proposed tax assessment against the Premises or any basis for such assessment which is material and
not being contested in good faith by Borrower through appropriate proceedings after the
establishment of appropriate reserves therefor with Agent’s approval. The Land is separately
assessed from all other adjacent land for purposes of real estate taxes, and for all purposes may
be dealt with as an independent parcel.




          SECTION 4.32.    Adverse Contracts. Borrower is not a party to any contract or agreement, or
subject to any charter or other restriction, which materially and adversely affects its business,
including the operation, use and marketing of the Premises in accordance with the standards
required pursuant to Section 5.2 hereof, property, assets, operations, condition (financial
or otherwise) taken as a whole, or its ability to perform its obligations under this Loan Agreement
or any of the other Loan Documents.




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          SECTION 4.33.    Adverse Claims. To Borrower’s knowledge, there are no adverse claims to the title
of Borrower in and to the Mortgaged Property, the other Collateral, the Premises or any rights
appurtenant thereto other than the Permitted Encumbrances.




          SECTION 4.34.    Creditworthiness. Both before and immediately after entering into each of the
Loan Documents to which Borrower is a party, Borrower is able to pay its debts and other
obligations when due and has a positive net worth (giving effect in each case to Borrower’s release
from its obligations under the Indebtedness encumbering the Premises prior to the date hereof,
which release has been obtained by Borrower). Borrower’s assets do not and, immediately following
the making of the Loan will not, constitute unreasonably small capital to carry out its business as
conducted or as proposed to be conducted.




          SECTION 4.35.    Patriot Act. None of Borrower, Guarantor, or, to Borrower’s knowledge, any owner
of a direct or indirect interest in Guarantor (a) is listed on any Government Lists (as defined
below), (b) is a Person who has been determined by competent authority to be subject to the
prohibitions contained in Presidential Executive Order No. 13224 (Sept. 23, 2001) or any other
similar prohibitions contained in the rules and regulations of OFAC (as defined below) or in any
enabling legislation or other Presidential Executive Orders in respect thereof, (c) has been
previously indicted for any Patriot Act Offense (as defined below), (and, with respect to Borrower
and Guarantor only, no felony involving a crime or crimes of moral turpitude) or (d) with respect
to Borrower and Guarantor only, is currently under investigation by any governmental authority for
alleged criminal activity. For purposes hereof, the term “Patriot Act Offense” means any
violation of the criminal laws of the United States of America or of any of the several states, or
that would be a criminal violation if committed within the jurisdiction of the United States of
America or any of the several states, relating to terrorism or the laundering of monetary
instruments, including any offense under (i) the criminal laws against terrorism; (ii) the criminal
laws against money laundering, (iii) the Bank Secrecy Act, as amended, (iv) the Money Laundering
Control Act of 1986, as amended, or (v) the Patriot Act. “Patriot Act Offense” also
includes the crimes of conspiracy to commit, or aiding and abetting another to commit, a Patriot
Act Offense. For purposes hereof, the term “Government Lists” means (A) the Specially
Designated Nationals and Blocked Persons Lists maintained by the Office of Foreign Assets Control
(“OFAC”), (B) any other list of terrorists, terrorist organizations or narcotics
traffickers maintained pursuant to any of the Rules and Regulations of OFAC that Agent notified
Borrower in writing is now included in “Government Lists”, or (C) any similar lists maintained by
the United States Department of State, the United States Department of Commerce or any other
government authority or pursuant to any Executive Order of the President of the United States of
America that Agent notified Borrower in writing is now included in “Government Lists”.




          SECTION 4.36.    Leases. Borrower has delivered to Agent true, correct and complete copies of all
Major Leases and, as of the Closing Date, all Leases in effect as of the Closing Date. As of the
Closing Date, there are no Leases with respect to the Premises other than the Leases delivered to
Agent in connection with the closing of the Loan. Except as Borrower has otherwise notified Agent
in writing: (a) each Major Lease is in full force and effect; (b) all Rents due and payable under
the Major Leases have been paid and no portion of any Rent has been paid for any period more than
thirty (30) days in advance; (c) to Borrower’s knowledge there is no claim or basis for a claim by
the Lessee under any Major Lease for an



49









 






adjustment to its fixed rent; (d) no default in any material respect by Borrower exists under any
Major Lease, and no event exists which, with the giving of notice or passage of any cure period, or
both, would constitute a default in any material respect by Borrower under any Major Lease; (e) to
Borrower’s knowledge, there are no offsets, claims or defenses to the enforcement by Borrower of
any Major Lease presently outstanding; (f) Borrower has not received a notice of default under any
Major Lease which remains outstanding; (g) to Borrower’s knowledge, no default by any Lessee in any
material respect exists under any Major Lease, and no grounds for termination by any Lessee exists,
and no event exists which, with the giving of notice or passage of any cure period, or both, would
constitute a default in any material respect by any Lessee under any Major Lease or give rise to
any right of any Lessee to terminate any Lease; (h) each Lease represents the entire agreement
between Borrower and the Lessee thereunder with respect to the leasing of space at the Premises,
and there are no other agreements or representations, written or oral, between Borrower and such
Lessee with respect to thereto; (i) Borrower has obtained all consents necessary to assign the
Major Leases to Agent pursuant to the Loan Documents; (j) no Lease contains any option to purchase
or right of first refusal to purchase the Mortgaged Property or any part thereof; (k) all Security
Deposits under the Leases are held pursuant to Section 2.15 hereof, and Borrower and
Property Manager, if any, are in compliance with all Legal Requirements with respect to all
Security Deposits; (l) no use restriction contained in any Major Lease, Permitted Encumbrance or
Premises Document is violated by any use permitted under any other Major Lease, any Permitted
Encumbrance or any Premises Document; and (m) all Major Leases have been entered into in accordance
with the Permitted Encumbrances and the Premises Documents.




          SECTION 4.37.    Special Purpose Entity. Borrower is a Special Purpose Bankruptcy Remote Entity.




          SECTION 4.38.    Solvency. Borrower has (a) not entered into this transaction or any Loan Document
with the actual intent to hinder, delay, or defraud any creditor and (b) received reasonably
equivalent value in exchange for its Obligations under the Loan Documents. Borrower does not
intend to, and does not believe that it will, incur Indebtedness and liabilities (including
contingent liabilities and other commitments) beyond its ability to pay such Indebtedness and
liabilities as they mature (taking into account the timing and amounts of cash to be received by
Borrower and the amounts to be payable on or in respect of obligations of Borrower).




ARTICLE V




GENERAL AND OPERATIONAL COVENANTS




          SECTION 5.1.    Financial Statements, Reports and Documents of Borrower. Borrower shall deliver to
Agent each of the following:





     (a) Annual Financial Statements. As soon as practicable and in any event within one
hundred and twenty (120) days after the close of each fiscal year of Borrower, audited
financial statements of Borrower for such period and the immediately preceding fiscal year
to date, which shall include a detailed balance sheet, statements of operations (income and
expenses), cash flow, assets, liabilities (direct and contingent), changes in



50









 







members’ or partners’ capital or shareholder’s equity, as applicable and any other
financial information with respect to Borrower as shall be reasonably required by Agent, in
form reasonably acceptable to Agent, prepared in accordance with GAAP consistently applied
for all periods, and audited by and accompanied by an opinion thereon by an independent
certified public accounting firm selected by Borrower and reasonably acceptable to Agent,
which audit shall be unqualified as to the scope of audit and state that such financial
statements were prepared in accordance with GAAP, and that the examination of such
accounting firm in connection with such financial statements has been made in accordance
with generally accepted auditing standards. Such financial statements shall also be
certified by the chief executive, operating or financial officer of Borrower or of the
managing member (directly or indirectly) of Borrower as being true, correct and complete in
all material respects and fairly presenting the financial position of Borrower.




     (b) Quarterly Financial Statements. As soon as practicable and in any event within
forty-five (45) days after the end of each Calendar Quarter, unaudited financial statements
of Borrower for such period, the trailing twelve (12) months, the fiscal year to date and
the immediately preceding fiscal year to date, which shall include a detailed balance sheet,
statements of operations (income and expenses), cash flow, assets, liabilities (direct and
contingent), changes in members’ or partners’ capital or shareholder’s equity, as applicable
and any other financial information with respect to Borrower as shall be reasonably required
by Agent, in form reasonably acceptable to Agent, prepared in accordance with GAAP
consistently applied for all periods, and state in comparative form the respective figures
for the corresponding date and period in the preceding fiscal year. Such financial
statements shall also be certified by the chief executive, operating or financial officer of
Borrower or of the managing member (directly or indirectly) of Borrower as being true,
correct and complete in all material respects and fairly presenting the financial position
of Borrower.




     (c) Monthly Reports. As soon as practical, but in any event no later than twenty-five
(25) days after the end of each calendar month:




     (i) a monthly statement with respect to such Account from the financial
institution holding such Account, together with any other information relating to
such Account as Agent may reasonably request;




     (ii) a STR report for hotels in the same category as the Premises; and




     (iii) a certificate setting forth in reasonable detail Borrower’s calculation
of such FF&E Reserve Amount deposited into the FF&E Reserve Account for such
calendar month




all of which shall be certified by the chief executive, operating or financial officer of
Borrower or of the managing member (directly or indirectly) of Borrower as being true,
correct and complete in all material respects.



51









 






     (d) Compliance Certificate. Within forty-five (45) days after the end of each Calendar
Quarter, a certificate executed by the chief executive, operating or financial officer of
Borrower or of the managing member (directly or indirectly) of Borrower (in his or her
capacity as such) in the form attached hereto as Schedule 5.1(d), accompanied by
appropriate calculations showing the Debt Service Coverage Ratio for the applicable period.




     (e) Notices by Governmental Authorities. Promptly upon Borrower’s receipt of same,
true and complete copies of any official notice, claim or complaint by any Governmental
Authority pertaining to Borrower, Property Manager or Guarantor, the Premises, the
Collateral, Borrower’s rights under any Permitted Encumbrance or any license, permit or
approval obtained by Borrower which would have a Material Adverse Effect, including any
notice from a public authority concerning any tax or special assessment, or any notice of
any alleged violation of any zoning ordinance, restrictive covenant, fire ordinance,
building code provision, or other Legal Requirement and any notice of any Taking or other
eminent domain action or proceeding affecting or threatened against any portion of the
Premises.




     (f) Annual Budgets. As soon as available and in any event within thirty (30) days
prior to the end of each calendar year, a copy of the operating and capital/FF&E budgets,
including all reserves, for the Premises, for the following calendar year. During the
existence of any Cash Sweep Condition, Borrower shall not adopt any budget as final without
Agent’s prior reasonable consent, and upon the occurrence of any Cash Sweep Condition,
Borrower shall submit to Agent for its reasonable approval operating and capital/FF&E
budgets regardless of any budget theretofore delivered to Agent. During the existence of
any Cash Sweep Condition or Event of Default, no budget shall be amended without the prior
reasonable consent of Agent. In the event that Borrower does not timely submit an operating
and/or capital/FF&E budget as required hereunder or Agent does not approve such budget, the
Approved Operating Budget and/or Approved Capital Budget, as applicable, for the following
calendar year shall be the Approved Operating Budget and/or Approved Capital Budget, as
applicable, for the immediately preceding calendar year, with such changes thereto as may be
required by Franchisor and as may be necessary to pay mandatory increases in Impositions and
insurance premiums. In the event that Agent does not approve a budget amendment, the
current Approved Operating Budget and/or Approved Capital Budget, as applicable, shall
remain in effect, with such changes thereto as may be required by Franchisor and as may be
necessary to pay mandatory increases in Impositions and insurance premiums. If Borrower
seeks Agent’s consent to a proposed budget or amendment hereto, Borrower may give Agent
written notice of such request with such notice containing in boldface type at the beginning
of such notice text to the effect that “THIS IS A REQUEST FOR CONSENT TO ONE OR MORE
PROPOSED BUDGETS FOR THE FOLLOWING CALENDAR YEAR OR AMENDMENTS TO ONE OR MORE EXISTING
BUDGETS PURSUANT TO THAT CERTAIN LOAN AGREEMENT AMONG INTERSTATE ATLANTA AIRPORT, LLC, AS
BORROWER, CERTAIN LENDERS AND PB CAPITAL CORPORATION, AS AGENT FOR THE LENDERS. FAILURE TO
RESPOND WITHIN THIRTY (30) DAYS AFTER RECEIPT OF THIS NOTICE SHALL BE DEEMED TO BE A CONSENT



52









 







TO THE BUDGET(S) OR BUDGET AMENDMENT(S) ENCLOSED HEREWITH”, and enclose with such
notice a copy of the proposed budgets or amendments, as applicable. If within thirty (30)
days after receipt of such notice and copies of the proposed budgets or amendments, as
applicable, Agent shall not have responded to Borrower indicating whether or not it consents
to same, Agent’s consent to such proposed budgets or amendments, as applicable, shall be
deemed given.




     (g) Income Tax Returns. Within thirty (30) days after the filing thereof, true and
correct copies of the federal income tax returns and extensions of Borrower, including all
schedules, exhibits and attachments thereto or other documents filed together with such
returns, unless Borrower is consolidated with another Person for federal income tax purposes
and does not separately file federal income tax returns.




     (h) Management and Franchise Agreements; Competition Reports. Contemporaneous with
Borrower’s receipt or giving of same, a copy of all material statements and reports provided
to or by Borrower pursuant to the Management Agreement and Franchise Agreement and any
notice of default and other material notice or other material written communication given
under, pursuant to or in connection with the Management Agreement and Franchise Agreement.




     (i) Notification by Borrower. The following notifications:




     (i) promptly after Borrower’s learning thereof, any litigation or proceeding or
any mediation or arbitration with respect to Borrower, Guarantor, the Premises, the
Collateral, Borrower’s rights under any Permitted Encumbrance, any Premises Document
or any license, permit or approval obtained by Borrower or the Liens securing the
Obligations, including any challenge to or appeal of any Operating Permit or zoning
applicable to the Premises, specifying the nature and status thereof, and any
material determinations in all such litigation, proceedings, mediations and
arbitrations (other than those arising from “slip-and-fall” and other routine claims
ordinarily made in the normal course of operating the Premises which, if adversely
determined, would reasonably likely have no Material Adverse Effect and are covered
by Borrower’s insurance and with respect to which the insurer has not denied
coverage or refused to defend and immaterial contract disputes involving Borrower
and its contractors or service suppliers ordinarily made in the normal course of
operating the Premises which, if adversely determined, would reasonably likely have
no Material Adverse Effect);




     (ii) promptly after Borrower’s learning thereof, any material adverse change in
any material fact or circumstance represented or warranted in this Loan Agreement or
any of the other Loan Documents, and of any fact or circumstance which might
materially and adversely interfere with the operation of the Premises or the
ownership of any of the Collateral;




     (iii) within three (3) Business Days after the occurrence thereof, of any
acceleration of any Indebtedness of Borrower;



53









 






     (iv) within five (5) Business Days after the occurrence thereof, of any name
change or change in fiscal year for, or change in the principal place of business or
chief executive office of, Borrower;




     (v) within thirty (30) Business Days after the occurrence thereof, a copy of
any amendment to the Borrower Operating Agreement or any other organizational
document, of Borrower, and promptly following Agent’s request, a list or
organizational chart of the owners of direct or indirect beneficial and equitable
interests in Borrower in the form attached to the Borrower’s Certificate (and
excluding shareholders of Guarantor);




     (vi) promptly upon occurrence thereof, any breach, default or failure of
performance by any party under, or any written notice that a party has challenged or
denied the validity or enforceability of the Permitted Encumbrances, any Material
Operating Agreement, the Management Agreement, the Franchise Agreement or any
material other agreement, contract, or other instrument to which Borrower is a party
or by which any of its properties are bound;




     (vii) promptly after receipt of notice of the same from any Person, any
material adverse claim against or affecting Borrower, Guarantor, the Premises, the
Collateral, Borrower’s rights under any Permitted Encumbrance or any license, permit
or approval obtained by Borrower or the Liens securing the Obligations (other
“slip-and-fall” and other routine claims ordinarily made in the normal course of
operating the Premises which, if adversely determined, would reasonably likely have
no Material Adverse Effect and are covered by Borrower’s insurance and with respect
to which the insurer has not denied coverage or refused to defend and immaterial
contract disputes involving Borrower and its contractors or service suppliers
ordinarily made in the normal course of operating the Premises which, if adversely
determined, would reasonably likely have no Material Adverse Effect); and




     (viii) (i) within ten (10) days after Borrower or any ERISA Affiliate knows or
has reason to know that any ERISA Event has occurred, written notice describing such
event; (ii) within ten (10) days after Borrower or any ERISA Affiliate knows or has
reason to know that a request for a minimum funding waiver under IRC Section 412 has
been filed with respect to any Pension Plan or Multiemployer Plan, a written
statement of Borrower describing such ERISA Event or waiver request and the action,
if any, Borrower and ERISA Affiliates propose to take with respect thereto and a
copy of any notice filed with the PBGC or the IRS pertaining thereto; (iii) within
thirty (30) days after Borrower or any ERISA Affiliate knows or has reason to know
that there has been a material increase in the unfunded pension liability of any
Pension Plan, notice of such occurrence; (iv) simultaneously with the date that
Borrower or any ERISA Affiliate files a notice of intent to terminate any Pension
Plan, if such termination would require material additional contributions in order
to be considered a standard termination within the meaning of Section 4041(b) of
ERISA, a copy of each notice; and (v) within ten (10) days after Borrower or any
ERISA Affiliate



54









 







adopts a new Pension Plan or becomes obligated to contribute to a Multiemployer
Plan, written notice describing same.




     (j) Notice Regarding Contracts. Promptly following the occurrence thereof,
notification of any material changes in any Material Operating Agreement to the extent same
has or would reasonably be likely to have a Material Adverse Effect.




     (k) Property Rights and Claims. Promptly after receipt of same, a copy of any notice
or other instrument received by Borrower which could reasonably be expected to materially
adversely affect Borrower, Guarantor, the Premises, the Collateral, Borrower’s rights under
any Permitted Encumbrance or any license, permit or approval obtained by Borrower or the
Liens securing the Obligations.




     (l) Estoppel Certificates. Within ten (10) Business Days after request therefor from
Agent, Borrower will deliver to Agent a certificate executed by Borrower, stating the amount
due under the Note and this Loan Agreement and to the effect that as of the date of such
certificate no Default or Event of Default has occurred and is continuing or, if any such
Default or Event of Default has occurred and is continuing, describing in reasonable detail
each such Default or Event of Default and the action, if any, taken or being taken to cure
the same, and such other information regarding the Loan, the Premises and Borrower as Agent
reasonably requests.




     (m) Other Information. Promptly after Agent’s request, such other information
concerning the business, properties, or financial condition of Borrower and Guarantor,
including the performance of their obligations under the Loan Documents, as Agent shall
reasonably request.



          SECTION 5.2.    Marketing, Management, Maintenance and Repairs.




          (a) The Premises shall at all times be managed directly and exclusively by a Property Manager
under a Management Agreement, and be licensed by a Franchisor under a Franchise Agreement.
Borrower shall keep the Management Agreement and Franchise Agreement in full force and effect and
shall not, without the prior consent of Agent, surrender, terminate or cancel the Management
Agreement or Franchise Agreement. Borrower shall not modify, amend or supplement in any material
respect the Management Agreement or Franchise Agreement, waive, discount, set-off, compromise, or
in any manner release or discharge any material obligation of Property Manager or Franchisor under
the Management or Franchise Agreement, waive any material right of Borrower under the Management
Agreement or the Franchise Agreement, enter into any new or additional Management Agreement or
Franchise Agreement or agreement in substitution for the Management Agreement or Franchise
Agreement, or consent to the assignment of the Management Agreement or Franchise Agreement without,
in each instance, Agent’s prior consent. Agent’s consent to the foregoing (other than terminations
or surrenders of the Franchise Agreement or the Management Agreement (unless, with respect to a
termination or surrender of a Management Agreement, a new Management Agreement will be concurrently
entered into and no Event of Default exists, in which case Agent’s consent shall not be
unreasonably withheld) and assignments of and new, additional or substitute Franchise Agreements)
shall not be unreasonably withheld or delayed provided no



55









 






Event of Default exists. Borrower shall comply in all material respects with all terms of the
Management Agreement and Franchise Agreement. Borrower shall use commercially reasonable efforts
to enforce or secure the performance of the obligations of the other parties to the Management
Agreement and the Franchise Agreement in all material respects and to enforce Borrower’s rights
thereunder in all material respects. Borrower shall appear in and defend any action or proceeding
arising under, occurring out of, or in any manner connected with, the Management Agreement or the
Franchise Agreement or the obligations, duties, or liabilities of Borrower or Property Manager or
Franchisor thereunder. Borrower shall pay all costs and expenses of Agent, including reasonable
attorneys’ fees, in any action or proceeding in which Agent may appear.




          (b) Borrower shall cause the Premises to be at all times open for business to the public
(except for temporary closings due to renovations, Casualties, Takings or pursuant to governmental
order; provided that (i) at all times during such temporary closing due to Casualty or a
Taking Borrower shall diligently pursue the Restoration of the Premises in accordance with this
Loan Agreement and maintain all insurance required by this Loan Agreement and (ii) no such
temporary closing shall be deemed to waive, stay or otherwise limit any other Obligations) and
operated, maintained and managed materially in the manner and materially in accordance with the
standards required pursuant to the Management Agreement, the Leases, the Permitted Encumbrances and
the Premises Documents, but in no event below Comparable Standards.




          (c) Subject to the last sentence of Section 5.2(a) hereof, Borrower shall keep in
effect at all times any contractual arrangements as may be necessary to meet the standard of
operation described in the foregoing sentence and as may be required by Legal Requirements and
Operating Permits. In furtherance of the foregoing, Borrower shall keep the Premises in good
repair, working order and condition, so that the value of all or any portion of the Premises will
not be diminished in any material respect and shall supply the Premises and such property with all
necessary supplies and equipment and promptly and diligently make or cause to be made all needful
and proper repairs, renewals and replacements thereto whether interior or exterior, structural or
non-structural, ordinary or extraordinary, or foreseen or unforeseen consistent with and in order
to maintain the standards set forth above. All such repairs, renewals and replacements shall be at
least equal in quality, value and class to that of the improvements which are the subject of such
repairs, renewals and replacements. Without limiting the foregoing, Borrower shall not use or
permit to be used any part of the Premises for any dangerous or noxious use or use that impairs the
ability to use, operate, maintain and manage the Premises in accordance with this Section
5.2, or cause or permit to be maintained any nuisance in, at or on the Premises.




          (d) Borrower shall not commit or permit any waste or deterioration (other than ordinary wear
and tear) of or to the Premises or other improvements, structures and equipment thereon. Borrower
shall promptly, diligently and continuously restore, replace or rebuild or cause to be restored,
replaced or rebuilt any part of and improvements, structures and equipment on the Premises damaged
or destroyed by any Casualty (including any Casualty for which insurance was not obtained or
obtainable) or which may be affected by any Taking, in accordance with the Loan Documents, the
Leases, the Premises Documents and the Permitted Encumbrances. Borrower shall promptly replace, or
caused to be replaced, any part of the Premises taken by theft to the extent necessary to comply
with the provisions of this Section 5.2.




56









 








          SECTION 5.3.    Inspection of Premises and Books and Records.




          (a) Borrower shall permit Agent and its designated representatives to enter upon and inspect
the Premises, or any part thereof, in an emergency, subject to reasonable safety rules with respect
to inspections during emergencies, and at all other times during normal business hours and upon
reasonable notice, with free access to inspect or examine the Premises; provided,
however, that such inspection or examination shall not unreasonably interfere with the
operation of the Premises or unreasonably disturb the guests or tenants therein. At Borrower’s
expense, Borrower shall permit Agent and its designated representatives to review, inspect and
examine the following:




               (i) all materials and shop drawings pertaining to any construction or alteration of any
improvements;



               (ii) any contracts, bills of sale, statements, receipts, books, vouchers and records,
pertaining to the construction or alteration of any improvements;



               (iii) all work done, labor performed or materials furnished in and about the Premises or
stored or otherwise located off-site in connection with the construction of any improvements; and



               (iv) any other documents which are related to the construction or alteration of any
improvements.



          (b) Borrower, at its expense, promptly shall provide Agent with copies of any of the drawings
and other materials referred to in clauses (i), (ii) and (iv) of
Section 5.3(a) hereof as Agent may from time to time request. Borrower shall make its
representatives available to meet with Agent and/or its designated representatives upon reasonable
notice at reasonable times at the Premises or in New York, New York, to discuss Borrower’s affairs,
finances and accounts, and Borrower shall cooperate, and take all reasonable steps to cause the
Property Manager to cooperate with Agent and its designated representatives with respect to the
foregoing.




          (c) Agent shall have no duty to make any inspection nor shall Agent incur any liability or
obligation for not making any such inspection or, once having undertaken any such inspection, for
making the inspection, not making the same carefully or properly, or for not completing the same;
nor shall the fact that such inspection may not have been made by Agent relieve Borrower of any
obligations that it may otherwise have under the Loan Documents.




          (d) Borrower shall at all times keep complete and accurate books, records and accounts of its
transactions. At Borrower’s expense, Borrower shall permit any representative of Agent, at all
times during normal business hours upon reasonable notice, to examine and copy the books and
records of Borrower, and all contracts, statements, invoices, bills, and claims for labor,
materials, and services supplied for the construction, reconstruction, maintenance, operation and
repair of the Premises; provided, however, that such inspection or examination
shall not unreasonably interfere with the operation of the Premises or unreasonably disturb the
guests or tenants therein.





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          SECTION 5.4.    Compliance with Legal, Insurance and Contractual Requirements.




          (a) Subject to Borrower’s right to contest as set forth in Section 5.8 hereof,
Borrower, at its sole cost and expense, shall comply and cause compliance of the Premises and the
construction, use, occupancy, possession, operation, management, maintenance and ownership thereof,
with all Legal Requirements in all material respects and all Insurance Requirements, whether or not
compliance therewith shall require changes in, or interfere with the use and enjoyment of, the
Premises or any part thereof. Borrower shall preserve and maintain all of its rights, privileges
and Operating Permits necessary to fully operate, use and occupy the Premises in accordance with
Section 5.2 hereof. Agent shall not have any obligation or responsibility whatsoever for
any matter incident to the Premises or the maintenance and operation of the Premises. Borrower
agrees that all consents, approvals, orders or authorizations of, or registrations, declarations or
filings with, or other actions with respect to or by, any Governmental Authorities required for the
use, operation, occupancy and maintenance of the Premises and otherwise in connection with the
carrying out or performance of any of the transactions required or contemplated hereby or thereby
(other than routine construction and occupancy permits which are not appropriate or necessary for
the stages of construction in question) shall be obtained when required.




          (b) Borrower shall comply in all material respects with all of its covenants, obligations,
agreements and undertakings under the Premises Documents, the Permitted Encumbrances, the Material
Operating Agreements and each other agreement to which Borrower is a party or by which the
Mortgaged Property is bound, and make all reasonable efforts to secure the performance of the
obligations of the other parties thereto in all material respects and to enforce its rights
thereunder. Borrower shall keep in full force and effect and not terminate, cancel, surrender,
modify, amend or enter into any agreement in substitution for any Permitted Encumbrance or any
Premises Document, in each case without the prior consent of Agent, other than any termination
arising out of a default by the other party thereto and the termination thereof would be
commercially reasonable and in the ordinary course of business (but excluding Premises Documents
and Permitted Encumbrances which benefit the Premises). Borrower shall keep in full force and
effect and not terminate, cancel, surrender, modify, amend or enter into any agreement in
substitution for any Material Operating Agreement, in each case without the prior consent of Agent
not to be unreasonably withheld provided no Event of Default exists, other than any termination
arising out of a default by the other party thereto and the termination thereof would be
commercially reasonable and in the ordinary course of business.




          (c) Borrower, at its sole cost and expense, shall comply and cause compliance in all material
respects with all rights of way or use, declarations or transfers of air rights, other
declarations, zoning lot development agreements, privileges, franchises, licenses, servitudes,
easements and other encumbrances affecting or forming a part of the Mortgaged Property or any
portion thereof, and all instruments creating or evidencing the same, in each case, to the extent
compliance therewith is required of Borrower under the terms thereof. Borrower shall not take any
action which results in a forfeiture or termination of the rights afforded to Borrower under any
such instruments. Borrower shall make all reasonable efforts to secure the performance of the
obligations of the grantors or other parties thereto and to enforce Borrower’s rights



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thereunder. Borrower shall not, without the prior consent of Agent, modify, amend or enter
into any agreement in substitution for any such instruments.




          SECTION 5.5.    Appraisals. Agent shall be entitled to obtain, at Borrower’s expense, Appraisals
or Appraisal Updates at Agent’s election at any time that an Event of Default has occurred and is
continuing, in connection with the foreclosure of the Mortgage or the granting of a deed-in-lieu
thereof or the exercise of other remedies against Borrower, and at any other time not more than
once in any twenty-four (24) month period after the Closing Date, or more frequently if required
for regulatory purposes applicable to Agent or any Lender. Borrower shall cooperate with Agent and
any such appraiser and their agents and employees in connection with Appraisals and Appraisal
Updates.




          SECTION 5.6.    Payment of Impositions. Subject to Borrower’s right to contest in accordance as
set forth in Section 5.8 hereof, Borrower shall pay or cause to be paid all Impositions on
or before the due date thereof and in any event before any fine, penalty, interest or cost may be
added for non-payment. Borrower promptly shall deliver to Agent after payment of any Imposition
and at other times, upon request, copies of official receipts or other evidence satisfactory to
Agent evidencing the payment of the Impositions. Borrower shall not claim or demand or be entitled
to any credit or credits on account of the Obligations for any Imposition or any part thereof and
no deduction shall otherwise be made or claimed from the taxable value of the Mortgaged Property,
the Collateral or any part thereof, by reason of the Mortgage or the Obligations.




          SECTION 5.7.    Liens and Encumbrances; Ownership of Collateral. Borrower shall at all times be
the absolute and sole owner of, and have good, legal and beneficial title to, the Premises in fee
simple absolute, free and clear of all Liens except the Permitted Encumbrances and the Loan
Documents. Borrower shall at all times be the sole and absolute owner of and have legal and
beneficial title to the other Collateral, free and clear of all Liens except the Permitted
Encumbrances and the Loan Documents. In furtherance of the foregoing, (a) Borrower shall not make,
grant, modify or terminate any rights of way or use, declarations, transfers of air rights, other
declarations, zoning lot development agreements, privileges, franchises, licenses, servitudes,
easements and other encumbrances over, under or on the Land or Improvements or any portion thereof,
without the prior consent of Agent, (b) Borrower shall not directly or indirectly create or permit
or suffer to be created any Lien on Borrower’s interest in the Collateral or any part thereof,
other than the Permitted Encumbrances and the Loan Documents, subject, however, with respect to
Liens on the Collateral that are not voluntarily placed thereon by Borrower or any Affiliate
thereof, Borrower’s right to contest same in accordance with Section 5.8 hereof, and (c)
Borrower shall not directly or indirectly suffer or permit, and shall promptly discharge or cause
to be discharged, any Lien on any direct equity or beneficial interest in Borrower.




          SECTION 5.8.    Permitted Contests. After prior written notice to Agent and provided no Default or
Event of Default shall have occurred and be continuing, Borrower, at its sole cost and expense, may
contest, by appropriate legal proceedings conducted in good faith and with due diligence, the
amount or validity or application, in whole or in part, of any Imposition, Legal Requirement or
Insurance Requirement or Lien on the Collateral and defer the payment thereof or compliance
therewith, subject, however, to the following conditions:




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     (a) In the case of an unpaid Imposition, such proceedings shall suspend the collection
thereof from Borrower, Agent, Lenders and the Mortgaged Property and other Collateral;




     (b) neither the Mortgaged Property, the other Collateral, any Rents nor any part
thereof or interest therein, in the judgment of Agent, would be in any danger of being sold,
forfeited, terminated, canceled or lost in any respect;




     (c) in the case of a Legal Requirement, Borrower would not be in danger of criminal
liability for failure to comply therewith and neither Agent nor any Lender would be in
danger of any civil or criminal liability for failure to comply therewith;




     (d) Borrower shall have furnished such security, if any, as may be required in the
proceedings or as may be reasonably requested by Agent to ensure the payment of any
Imposition or Lien or the compliance with any Legal Requirement or Insurance Requirement, as
the case may be, together with any interest or penalties which may become due in connection
therewith, provided that no security shall be requested if it would be for less than
$100,000;




     (e) in the case of a Lien, such Lien shall be bonded over or otherwise removed of
record on or before the date which is sixty (60) days after Borrower receives written notice
or otherwise learns of such Lien, but in any case prior to the foreclosure or other
enforcement of such Lien;




     (f) the non-payment of the whole or any part of any tax, assessment or charge during
the pendency of any such action will not result in the delivery of a tax deed to the
Mortgaged Property or any part thereof, because of such non-payment;




     (g) the payment of any sums required to be paid under this Loan Agreement and the other
Loan Documents (other than any unpaid Imposition or Lien at the time being contested in
accordance with this Section 5.8) shall not be interfered with or otherwise
affected;




     (h) in the case of any Insurance Requirement, the failure of Borrower to comply
therewith shall not affect the validity or effectiveness of any insurance required to be
maintained by Borrower under Section 5.11 hereof; and




     (i) Borrower complies with any and all conditions or requirements set forth in any
other agreement to which Borrower is a party or pursuant to which the Premises is bound with
respect to such contest;


provided, that, the conditions set forth in clauses (a), (c), (d),
(e) and (f) shall not be conditions to a permitted contest pursuant to this
Section 5.8 if Borrower pays and otherwise complies with such Imposition, Legal Requirement
or Insurance Requirement or pays or bonds over such Lien.




          SECTION 5.9.    Alterations. (a) Borrower shall not alter or add to the Premises except for (i)
non-structural alterations and repairs in the ordinary course of business that cost or will cost,
in the aggregate for any calendar year, less than $500,000, (ii) alterations required by



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the Franchise Agreement, (iii) alterations set forth in an Approved Capital Budget and (iv)
alterations otherwise consented to by Agent, which shall not be unreasonably withheld or delayed
provided that no Event of Default exists and the alteration is non-structural, provided that with
respect to the matters set forth in the preceding clauses (ii), (iii) and
(iv) the following conditions are satisfied:





          (A) prior to commencing such improvement, Borrower shall have given Agent prior notice
of same containing a description of same and Borrower’s good faith estimate of the cost
thereof;




          (B) such alteration shall not violate the terms of any Legal Requirement;




          (C) upon completion, such alteration shall not adversely affect the structural
integrity of the Premises or building systems, or impair the ability to operate, maintain
and manage the Premises in accordance with Section 5.2 hereof;




          (E) if Agent requests, Borrower shall deliver to Agent all plans, specifications and
drawings and architect’s and other construction contracts, if any for such improvement for
Agent’s approval, not to be unreasonably withheld;




          (F) such improvement shall be performed diligently and continuously to completion, in a
good and workmanlike manner, on a lien-free basis and in compliance in all material respects
with all Legal Requirements and the requirements of the Permitted Encumbrances, Premises
Documents, the Management Agreement and the Franchise Agreement; and




          (G) Borrower shall deliver to Agent such other information and documentation as Agent
may reasonably request regarding such improvement.



          (b) After completion of each any alteration, Borrower shall provide Agent with a copy of the
as-built plans and specifications for same, if any.




          (c) Borrower shall maintain and make available to, or, at Agent’s request, provide to Agent
copies of (i) all plans, specifications and drawings, including drawings marked up to reflect
as-built conditions, substitutions and changes pertaining to the performance of each alteration and
improvement, or such other adequate records to reflect as-built conditions, substitutions and
changes, (ii) any contracts, bills of sale, statements, receipts or vouchers pertaining to each
alteration and improvement, and (iii) all books, contracts and records of Borrowers pertaining to
each alteration and improvement, including all work done, labor performed or materials furnished.




          SECTION 5.10.    Leases.




          (a) Borrower shall not enter into, amend, modify or otherwise supplement any Major Lease in
any material respect or enter into, terminate, consent to the assignment or surrender of, or grant
a waiver of any material provision or right of Borrower under any Major Lease without Agent’s prior
consent. Borrower shall not enter into, amend, modify, terminate,



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consent to the assignment or surrender of, or grant a waiver of any material provision or
right of Borrower under any non-Major Lease without Agent’s consent unless the foregoing is done in
the ordinary course of business of Borrower, is commercially reasonable and is on arm’s, length,
market terms with a creditworthy tenant, and each such non-Major Lease is and remains subordinate
to the Mortgage.




          (b) Without limiting Section 5.10(a) hereof, Borrower shall deliver to Agent a copy of
any Lease, and any amendment, modification or supplement thereof within five (5) Business Days
after the execution and delivery thereof.




          (c) Borrower shall comply in all material respects with all terms of the Leases. Borrower
shall not permit any Lessee to prepay Rents pursuant to the terms of any Lease more than thirty
(30) days in advance other than the usual prepayment of Rent as would result from the acceptance on
the first day of each month of the Rent for the ensuing month, according to the terms of any
Leases. Borrower shall promptly (i) notify Agent, in writing, of any defaults by any Lessee or
Lease guarantor under a Major Lease after Borrower becomes aware of the same and (ii) deliver to
Agent a copy of all termination notices, default notices, notices claiming any offset rights and
all other material notices from any Lessee or Lease guarantor under a Major Lease to Borrower or
from Borrower to any Lessee or Lease guarantor.




          (d) Borrower shall furnish to Agent, within ten (10) days after a request by Agent to do so, a
certified rent roll containing the names of all Lessees, the terms and expiration date of their
respective Leases, the space occupied, the rents payable and the securities deposited thereunder,
and the name of any Lease guarantor thereof, together with true copies of each Lease and any Lease
guaranty thereof or amendments and supplements thereto not previously furnished to Agent and any
other information with respect to Borrower’s leasing activities and policies as Agent shall
reasonably request.




          (e) Borrower shall appear in and defend any action or proceeding arising under, occurring out
of, or in any manner connected with, any Leases and Lease guaranties or the obligations, duties, or
liabilities of Borrower or any Lessee or any Lease guarantor thereunder. Borrower shall pay all
costs and expenses of Agent, including reasonable attorneys’ fees, in any action or proceeding in
which Agent may appear.




          (f) Borrower shall use commercially reasonable efforts to enforce or secure the performance of
the obligations of the Lessees and Lease guarantor under Major Leases in all material respects.
Borrower shall not waive, discount, set-off, compromise, or in any manner release or discharge any
material obligation of any Lessee or Lease guarantor under any Major Lease and Lease guaranty
thereof.




          (g) Borrower shall not, and shall not allow any Person on behalf of Borrower, to enter into
any agreement with any Person to pay lease commissions with regard to any Lease which agreement is
not subordinate to Agent’s rights, interests and claims under the Loan Documents.




          (h) All Leases entered into by Borrower shall be made expressly subject and subordinate to the
Mortgage and the terms and provisions thereof and shall contain provisions



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obligating the Lessees thereunder to attorn to Agent or any purchaser therefrom upon its
written demand in the event Agent or such purchaser succeeds to the interest of Borrower under such
Leases. Each Lease guaranty shall provide that it shall remain in full force and effect, and that
guarantor thereunder shall perform for the benefit of Agent or such purchaser, upon attornment by
the Lessee.




          (i) Borrower shall pay all reasonable, out-of-pocket expenses of Agent, including Agent’s
Counsel Fees, incurred in connection with the review of any proposed Lease, amendment,
modification, waiver, supplement, termination or surrender under this Section 5.10.




          SECTION 5.11.    Required Insurance.




          (a) Required Coverage. In addition to any insurance required to be maintained by Borrower
pursuant to the Management Agreement, the Premises Documents or the Leases, Borrower, at its sole
cost and expense, shall maintain the Insurance Policies set forth on Schedule 5.11 attached
hereto.




          (b) General Requirements of Insurance Policies. All Insurance Policies shall be issued by an
insurer or insurers with an A.M. Best rating of at least A:X (or, with respect to property and
liability insurers excess of a $25,000,000 primary policy, carriers may have an A.M. Best rating of
A-:XIII or better with an “Outlook” of either “Stable” or “Positive,” so long as these limits do
not exceed thirty percent (30%) of the aggregate program limits of Sponsor or ten percent (10%) of
the insurer’s policy holder surplus). The property, boiler and machinery Insurance Policies shall
also name Agent and each Lender under a non-contributing Standard Mortgagee or Lender Loss Payee
clause and, with respect to rental income, as Lender Loss Payee, on forms reasonably acceptable to
Agent, or equivalent endorsements reasonably satisfactory to Agent and shall be otherwise
reasonably satisfactory to Agent in form and content. All property Insurance Policies also shall
include a replacement cost and co-insurance waiver and/or an agreed amount endorsement and other
endorsements as are provided in Schedule 5.11 attached hereto. The amount of any
deductible under any Insurance Policy must be reasonably acceptable to Agent. No Insurance Policy
shall contain any exclusion for terrorism or terrorist acts or be subject to any sublimit for
terrorism or terrorist acts without the prior approval of Agent. Without Agent’s prior consent,
Borrower shall not name any Person other than Agent as loss payee or mortgagee under any property
Insurance Policies nor shall Borrower carry separate or additional insurance coverage covering the
Premises and such improvements and betterments which Borrower is required to insure pursuant to any
agreement concurrent in form or contributing in the event of loss with that required by this Loan
Agreement; provided, that, if blanket policies are obtained, this sentence shall not apply to
property covered by such blanket policies, other than the Premises and such improvements and
betterments. Borrower shall pay the premiums for the Insurance Policies as the same become due and
payable. Borrower shall deliver to Agent insurance-agent-certified copies of the Insurance
Policies required to be maintained pursuant to Section 5.11(a) hereof, provided,
however, Agent shall not be deemed by reason of the custody of such Insurance Policies to
have knowledge of the contents thereof. Borrower also shall deliver to Agent, within ten (10)
Business Days of Agent’s request, a certificate of Borrower or Borrower’s insurance agent
evidencing the coverages set forth herein together with evidence that all premiums due thereon have
been paid and that the same are in full force and effect. Not later than ten (10) Business



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Days prior to the expiration date of each of the Insurance Policies, Borrower shall deliver to
Agent a certificate of insurance, evidencing renewal of coverage as required herein, or binders of
all such renewal Insurance Policies, if available, or at Agent’s request and if available, an
insurance-agent-certified copy of a renewal policy or policies, in each case together with evidence
satisfactory to Agent that all premiums therefor have been paid and that the policies are in full
force and effect. Borrower shall in any case deliver to Agent an insurance-agent-certified copy of
each renewal policy promptly after it becomes available.




          (c) As to Agent and the Lenders. Each Insurance Policy shall contain a provision whereby the
insurer (1) agrees that such policy shall not be canceled or fail to be renewed, or the terms
thereof modified as described in clauses (y) and (z) below without, in each case,
at least thirty (30) days’ prior written notice to Agent, (2) waives any right to claim any
premiums and commissions against Agent and the Lenders, provided, that the policy need not waive
the requirement that the premium be paid in order for a claim to be paid to the insured and
(3) provides that Agent is permitted to make payments to effect the continuation of such policy
upon notice of cancellation due to nonpayment of premiums. Borrower shall notify Agent in the
event that (x) such policy shall be canceled or terminated, (y) the coverage, deductible and limits
of such policy shall be modified, or (z) other provisions of such policy shall be modified if such
policy, after giving effect to such modification, and all modifications in the aggregate, would not
satisfy the requirements of this Loan Agreement. Notwithstanding anything to the contrary in the
preceding sentence, Borrower shall be required to maintain such Insurance Policies in accordance
with the requirements of this Loan Agreement. In the event any Insurance Policy (except for
general public and other liability and workers’ compensation insurance) shall contain breach of
warranty provisions, such policy shall provide that with respect to the interest of Agent, such
Insurance Policy shall not be invalidated by and shall insure Agent regardless of (A) any act,
failure to act or negligence of or violation of warranties, declarations or conditions contained in
such policy by any named insured, (B) the occupancy or use of the Premises for purposes more
hazardous than permitted by the terms thereof, or (C) any foreclosure or other action or proceeding
taken by Agent pursuant to any provision of this Loan Agreement.




          (d) Blanket Policies. Any insurance maintained pursuant to this Section 5.11 may be
evidenced by blanket insurance policies covering the Premises and other properties or assets of
Borrower or its Affiliates; provided, that any such policy shall in all other respects
comply with the requirements of this Section 5.11.




          (e) Agent’s Right to Procure Insurance. Notwithstanding anything to the contrary contained
herein, if at any time Agent is not in receipt of written evidence that all insurance required
hereunder is maintained in full force and effect, including by any date by which any policy,
certificate or other evidence is required to be delivered hereunder, Agent shall have the right
(but not the obligation) to take such action as Agent deems necessary to protect its interests in
the Premises, including the obtaining of such insurance coverages as are required hereunder, and
all expenses incurred by Agent in connection with such action or in obtaining such insurance and
keeping it in effect shall be paid by Borrower promptly after demand and shall be secured by the
Loan Documents.




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          SECTION 5.12.    Damage or Destruction.




          (a) Promptly, and in any case within two (2) Business Days after the occurrence thereof,
Borrower shall notify Agent of any fire or other Casualty with respect to any portion of the
Premises. Within five (5) Business Days after the occurrence of such Casualty, Borrower shall
provide Agent with a general description of the nature and extent of such Casualty and set forth
Borrower’s good faith estimate of the cost of Restoration as of such date.




          (b) Agent shall be entitled to receive all insurance proceeds payable with respect to the
Premises on account of a Casualty. Borrower hereby irrevocably assigns, transfers and sets over to
Agent all rights of Borrower to any such insurance proceeds, award or payment. Borrower hereby
irrevocably authorizes and empowers Agent, in the name of Borrower or otherwise, to file for and
prosecute in its own name what would otherwise be Borrower’s claim for any such insurance proceeds.
Notwithstanding the foregoing, so long as no Default or Event of Default shall have occurred and
shall then be continuing and provided Borrower promptly files all claims and diligently prosecutes
same, Borrower shall have the right to file, adjust, settle and prosecute any claim for such
insurance proceeds; provided, however, that Borrower shall not agree to any
adjustment or settlement of any such claim payable with respect to a Casualty the insurance
proceeds with respect to which are greater than $1,000,000 (the “Casualty Proceeds Disbursement
Threshold”) without Agent’s prior consent. Borrower shall promptly after demand pay to Agent
all reasonable costs and expenses (including the fee of any insurance consultant or adjuster and
reasonable attorneys’ fees and disbursements) incurred by Agent in connection with a Casualty and
seeking and obtaining any insurance proceeds, award or payment with respect thereto. Net Proceeds
held by Agent, together with any interest earned thereon, shall constitute additional security for
the payment of the Obligations (a security interest therein being granted hereby) until disbursed
in accordance with this Section 5.12 or Section 5.14 hereof, as the case may be.
Notwithstanding the foregoing, or anything else herein, to the contrary, all proceeds of business
interruption/rent loss insurance may be collected by and shall be paid to Agent and applied in
accordance with Section 5.12(g) hereof.




          (c) Borrower shall use all Net Proceeds actually received by Borrower for the Restoration,
provided that if any such Net Proceeds remains after the completion of such Restoration, Borrower
shall apply same to the Loan as a prepayment thereof in accordance with Section 2.4(f)
hereof promptly after completion of such Restoration. Borrower shall, at its sole cost and
expense, promptly commence and diligently and continuously perform to completion the Restoration in
a good and workmanlike manner and in compliance in all material respects with all Legal
Requirements and the requirements of the Permitted Encumbrances, Premises Documents, the Management
Agreement and the Franchise Agreement, whether or not Borrower shall have satisfied the
requirements of Section 5.12(d) hereof in order to cause the Net Proceeds to be made
available for such Restoration and whether or not such insurance proceeds on account of the
Casualty shall be sufficient for such purpose.




          (d) In the case of any Casualty with respect to which the insurance proceeds payable are equal
to or greater than the Casualty Proceeds Disbursement Threshold, the Net Proceeds shall be held by
Agent, if Agent so elects, as a part of the Collateral and shall be applied or dealt with by Agent
as follows:




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	 	(i)	 	Subject to the other terms and conditions
hereof, the Net Proceeds shall be disbursed in accordance with Agent’s
standard construction lending practices, terms and conditions if the
following conditions are satisfied (each a “Release Condition”
and collectively, the “Release Conditions”):






	 	(A)	 	no Default or Event of Default
shall have occurred and be continuing;
	 
	 	(B)	 	Borrower shall have delivered to
Agent within ninety (90) days after the occurrence of the
Casualty, a notice of Borrower’s desire to undertake the
Restoration;
	 
	 	(C)	 	Borrower shall have demonstrated
to the reasonable satisfaction of Agent that the Restoration can
be substantially completed at least six (6) months prior to the
then-current Maturity Date, or such earlier time as may be
required by applicable Legal Requirements;
	 
	 	(D)	 	Borrower shall have demonstrated
to the reasonable satisfaction of Agent that sufficient funds
are available to Borrower through rent and/or business
interruption insurance maintained pursuant to
Section 5.11 hereof, cash, and/or a letter of credit or
other similar cash-equivalent security reasonably satisfactory
to Agent as to form, content and issuer, and which shall be for
the benefit of Agent, to pay all debt service with respect to
the Loan and all operating expenses with respect to the Premises
during the period reasonably estimated by Borrower as necessary
for the completion of the Restoration;
	 
	 	(E)	 	With respect to a Casualty the
insurance proceeds with respect to which are $5,000,000 or more,
Agent shall have been provided an Appraisal or any Appraisal
Update, certifying that upon completion of the repairs and
restoration of the Premises the Loan-to-Value Ratio shall be as
required pursuant to the definition of “Restoration” set
forth in Section 1.1 hereof;
	 
	 	(F)	 	to the extent, in Agent’s
reasonable judgment, the Net Proceeds are insufficient to pay
the costs of the Restoration, Borrower shall have provided Agent
with a letter of credit, cash deposit or similar equivalent
security in the amount of such deficiency in form, content and
issuer reasonably satisfactory to Agent;




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	 	(G)	 	Agent shall have received
architectural plans and specifications for all restoration and
repairs and an estimate of the costs and expenses of all such
restoration and repairs, all of which shall be in form
reasonably acceptable to Agent; and
	 
	 	(H)	 	Prior to any disbursement by
Agent, the following information and documentation shall have
been obtained by Borrower, at Borrower’s expense, and submitted
to Agent, which information and documentation shall be in form
and substance reasonably satisfactory to Agent:






	 	(1)	 	A request for
disbursement signed by Borrower, accompanied by billing
statements, vouchers or invoices, which request for
disbursement shall expressly warrant that the work with
respect to which the advance is requested has been
performed in all material respects in accordance with
the approved plans and specifications for the
restoration or repair;
	 
	 	(2)	 	Proof that all
invoices for labor and materials previously submitted by
Borrower and approved and reimbursed by Agent have been
paid, except for those the subject of the current
request for disbursement;
	 
	 	(3)	 	Lien waivers for
all payees under previous requests for disbursements;
	 
	 	(4)	 	With respect to a
Casualty the insurance proceeds with respect to which
are $5,000,000 or more, a report from Borrower’s
architect or, if Agent shall elect, Agent’s consultant,
which shall specify the percentage of completion of
restoration or repair, shall provide detailed comments
on specific work performed since the date of the last
such report, and, if required by Agent, an estimate of
the cost to complete the restoration and repair after
taking into account the work then completed;
	 
	 	(5)	 	At the request of
Agent, a title report or endorsement to the Title Policy
showing no Liens of record other than the Permitted
Encumbrances;
	 
	 	(6)	 	Copies of the
agreements pursuant to which the restoration or repair
shall be done, all of which shall




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	 	 	 	be in form and substance reasonably satisfactory to
Agent, and which also shall be reasonably
satisfactory to Agent as to the party performing the
construction obligations thereunder;
	 
	 	(7)	 	An assignment to
Agent of all construction and design-professional
contracts (which may be pursuant to the Mortgage and the
Assignment of Agreements), together with the written
consent to such assignments by all parties to such
contracts (which may be included in any such contract);
and
	 
	 	(8)	 	Such other
information and documentation as Agent may reasonably
request regarding the Improvements and the restoration
or repairs and the cost thereof.






	 	(ii)	 	Notwithstanding Section 5.12(d)(i)
hereof, if Agent does not elect to hold the Net Proceeds, Borrower
shall not disburse any Net Proceeds other than in accordance with the
conditions of this Section 5.12(d) and Sections 5.12(e)
and 5.12(f) hereof.





          (e) If one or more of the Release Conditions set forth in subsections (A) through
(H) of Section 5.12(d)(i) hereof are not satisfied within ninety (90) days after
the occurrence of the Casualty, all Net Proceeds shall be applied in accordance with
Section 5.14 hereof, provided, that, if each of the Release Conditions shall have
been satisfied except the Release Condition set forth in Section 5.12(d)(i)(A) hereof as a
result of the occurrence of a Default (as opposed to the occurrence of an Event of Default), Agent
shall not so apply the Net Proceeds until such time, if any, as an Event of Default shall have
occurred. If an Event of Default occurs, all Net Proceeds shall also be applied in accordance with
Section 5.14 hereof.




          (f) All reasonable costs and expenses incurred by Agent in connection with making the Net
Proceeds available for the Restoration (including reasonable attorneys’ fees and disbursements and
reasonable fees and actual out-of-pocket expenses of Agent’s construction consultants and
inspectors) shall be paid by Borrower. Any Net Proceeds remaining after the Restoration and the
payment in full of all costs incurred in connection with the Restoration, at Agent’s option, either
will be distributed by Agent to Borrower or applied as a mandatory prepayment of the Loan.




          (g) Business interruption/rent loss insurance proceeds of Borrower shall be deposited into the
Lockbox Account and disbursed in accordance with the Cash Management Agreement. Any business
interruption/rent loss insurance proceeds remaining after completion of the Restoration shall, at
Agent’s election, be distributed to Borrower or applied as a mandatory prepayment of the Loan
(without payment of the Prepayment Fee).




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          SECTION 5.13.    Taking of the Mortgaged Property.




          (a) Promptly, and in any case within two (2) Business Days after the occurrence thereof,
Borrower shall notify Agent of any Taking of any portion of the Premises, and promptly and in any
case within two (2) Business Days after Borrower receives notice thereof or otherwise obtains
knowledge thereof, the commencement of any proceedings or negotiations which might result in such a
Taking. Within five (5) Business Days after the occurrence of such Taking or Borrower’s receipt of
notice or knowledge of such proceedings or negotiations, Borrower shall provide Agent with a
general description of the nature and extent of such Taking or the nature of such proceedings or
negotiations and the nature and extent of the Taking which might result therefrom.




          (b) Agent shall be entitled hereunder to all awards or compensation payable on account of a
Taking. Borrower hereby irrevocably assigns, transfers and sets over to Agent all rights of
Borrower to any such awards or compensation and irrevocably authorizes and empowers Agent, in the
name of Borrower or otherwise, to collect and receipt for any such award or compensation and
delegate to Agent the right to file and prosecute any and all claims for any such awards or
compensation and to participate in any and all hearings, trials and appeals in connection with a
Taking on behalf of Borrower. Agent may participate in such proceedings or negotiations and
Borrower will deliver or cause to be delivered to Agent all instruments requested by Agent to
permit such participation; provided, however, that Agent shall be under no
obligation to question the amount of the award or compensation. Although it is hereby expressly
agreed that the same shall not be necessary, and in any event, Borrower shall, upon demand of
Agent, make, execute and deliver any and all assignments and other instruments sufficient for the
purpose of assigning any such award or compensation to Agent, free and clear of any encumbrances of
any kind or nature whatsoever. Agent may be represented by counsel satisfactory to it at the
expense of Borrower. Borrower will pay promptly after demand all costs and expenses (including
attorneys’ fees and disbursements and any appraiser or other consultant) incurred by Agent in
connection with any Taking and seeking and obtaining any award or payment on account thereof.
Notwithstanding the foregoing, so long as no Default or Event of Default shall have occurred and
shall then be continuing and provided Borrower promptly files all claims and diligently prosecutes
same, Borrower shall have the right to collect and receive any award or compensation arising from a
Taking, and to file and prosecute all claims for such awards and Agent shall not collect or receive
such awards or file or prosecute such a claim or participate in the proceedings or negotiations
thereof except for Takings with respect to which the award and compensation thereof is greater than
$500,000 (the “Condemnation Proceeds Disbursement Threshold”). Notwithstanding the
foregoing, or anything else herein, to the contrary, all awards and compensation for temporary
Takings may be collected by and shall be paid to Agent and applied in accordance with
Section 5.13(d)(iii) hereof




          (c) Borrower shall use all Net Restoration Awards actually received by Borrower for the
Restoration, provided that if any such Net Restoration Award remains after the completion of such
Restoration, Borrower shall apply same to the Loan as a prepayment thereof in accordance with
Section 2.4(f) hereof promptly after completion of such Restoration. Borrower shall, at
its sole cost and expense, promptly commence and diligently and continuously perform to completion
the Restoration in a good and workmanlike manner and in compliance with all Legal Requirements and
the requirements of the Permitted Encumbrances, the Premises



69









 






Documents, the Management Agreement and the Franchise Agreement, whether or not Borrower shall
have satisfied the Release Conditions in order to cause the Net Restoration Award to be made
available for such Restoration and whether or not such awards or compensation, if any, on account
of the Taking shall be sufficient for such purpose.




          (d) In the case of any Taking with respect with respect to which the award and compensation
thereof is greater than the Condemnation Proceeds Disbursement Threshold, the Net Proceeds shall be
held by Agent, if Agent so elects, as a part of the Collateral and shall be applied or dealt with
by Agent as follows:




               (i) If the Release Conditions are satisfied, and the Taking is not a Material Taking, all Net
Restoration Awards shall be applied to pay the cost of Restoration, such application to be effected
in the same manner as provided in Section 5.12(d) hereof with respect to Net Proceeds and
the balance, if any, of such Net Restoration Awards shall, at the option of Agent, be applied as a
prepayment of the principal amount of the Loan (without payment of the Prepayment Fee) or be paid
over or assigned to Borrower following completion of the Restoration.



               (ii) If the Taking is a Material Taking, or one or more of the Release Conditions set forth in
subsections (A) through (H) of Section 5.12(d)(i) hereof are not satisfied
within ninety (90) days after the occurrence of the Taking, all Net Restoration Awards shall be
applied in accordance with Section 5.14 hereof, provided, that, if each of the
Release Conditions shall have been satisfied except the Release Condition set forth in
Section 5.12(d)(i)(A) hereof as a result of the occurrence of a Default (as opposed to the
occurrence of an Event of Default), Agent shall not so apply the Net Proceeds until such time, if
any, as an Event of Default shall have occurred. If an Event of Default occurs, all Net
Restoration Awards shall also be applied in accordance with Section 5.14 hereof.



               (iii) In the case of a Taking for temporary use, any Net Restoration Awards shall be deposited
in the Lockbox Account and disbursed in accordance with the Cash Management Agreement. Any amounts
remaining after completion of the Restoration shall, at Agent’s election, be distributed to
Borrower or applied as a mandatory prepayment of the Loan (without payment of the Prepayment Fee).



          SECTION 5.14.    Application of Proceeds of Casualty or Taking to Loan; Loan Repayment. Upon a
Casualty, if the disposition of the Net Proceeds is governed by Section 5.12(e) hereof or
upon a Taking, if the disposition of the Net Restoration Awards is governed by
Section 5.13(d)(ii) hereof, at the option of Agent, the Loan shall be immediately due and
payable. Regardless of whether Agent shall so elect to accelerate the maturity of the Loan as
aforesaid, Agent shall have the option to (a) make available the Net Proceeds or the Net
Restoration Awards, as the case may be, to Borrower for Restoration in the manner provided in
Section 5.12(d) hereof or (b) apply the Net Proceeds and/or the Net Restoration Awards to
the Obligations in such order and manner as Agent determines, as the case may be (without payment
of the Prepayment Fee).




          SECTION 5.15.    Costs and Expenses. Without limiting any other provision of this Loan Agreement
or of any other Loan Document, Borrower shall pay within five (5)



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Business Days after demand by Agent, to or for the account of Agent as the case may be, Agent’s
Counsel Fees and all other reasonable costs and expenses incurred by or on behalf of Agent and/or
Lenders in connection with the closing of the Loan, any prepayments of the Loan, Agent’s responses
to requests for consents and waivers under the Loan Documents, all payments from any accounts, any
modification, amendment or restructuring of the Loan or the Loan Documents (regardless if such
modification, amendment or restructuring closes), any breach or possible breach by Borrower or
Guarantor of the Loan Documents or failure of Borrower to satisfy any condition therein, and the
enforcement of Agent’s and Lenders’ rights and remedies under the Loan Documents and other
agreements relating to the Loan, Borrower or the Collateral or otherwise at law or equity, or with
respect to any and all other aspects of the transactions contemplated herein or in any other Loan
Document, including the following, whether currently outstanding or which may arise at any time
during the term of the Loan:





     (a) all taxes and recording expenses, including all filing fees and mortgage recording
and deed transfer taxes, with respect to the Security Documents, and any other documents
modifying, extending or consolidating the Security Documents;




     (b) in the event the Mortgaged Property or other Collateral, or any part thereof, shall
be advertised for foreclosure sale and not sold, all costs in connection therewith,
including attorneys’ fees and disbursements, advertising costs and trustees’ commissions;




     (c) all title insurance charges and premiums; and




     (d) all survey, investigation, insurance and, subject to the provisions hereof,
appraisal, fees and expenses and all costs of preparing environmental, engineering and
insurance reports concerning the Premises.



          SECTION 5.16.    Transfers.




          (a) Unless the same is a Permitted Personal Property Transaction or a Permitted Transfer (as
hereinafter defined), no Transfer shall be made without Agent’s prior consent.




          (b) Agent shall not be required to demonstrate any actual impairment of its security or any
increased risk of default hereunder in order to declare the Loan immediately due and payable upon
the occurrence of a Transfer, other than a Permitted Personal Property Transaction or a Permitted
Transfer, without Agent’s consent. This provision shall apply to every Transfer, other than a
Permitted Personal Property Transaction or a Permitted Transfer, regardless of whether voluntary or
not, or whether or not Agent has consented to any previous Transfer.




          (c) Agent’s consent to Transfer for which Agent’s consent is required shall not be deemed to
be a waiver of Agent’s right to require such consent to any future occurrence of same for which
Agent’s consent is required.




          (d) Borrower agrees to bear and shall pay or reimburse Agent on demand for all reasonable
expenses (including, without limitation, reasonable attorneys’ fees and



71









 






disbursements, title search costs and title insurance endorsement premiums) incurred by Agent
in connection with the review, approval and documentation of any such Transfer.




          (e) Agent’s consent shall not be required with respect to the following Transfers (each, a
“Permitted Transfer”):





          (i) the merger or consolidation of Interstate Operating with Guarantor provided that
Borrower shall have given Agent prior notice of such merger or consolidation, the
obligations of Guarantor under the Loan Documents to which it is a party shall not be
affected, after such merger or consolidation, Borrower shall continue to comply with the
terms of Sections 4.34 and 5.33 hereof and no such merger or consolidation
shall have a Material Adverse Effect;




          (ii) the merger or consolidation of Interstate Operating and/or Guarantor other than as
set forth in the preceding clause (i), provided, that:




	 	(A)	 	Borrower shall have given Agent
prior notice of such merger or consolidation;
	 
	 	(B)	 	after such merger or
consolidation, Borrower shall continue to comply with the terms
of Sections 4.34 and 5.33 hereof;
	 
	 	(C)	 	no such merger or consolidation
shall have a Material Adverse Effect;
	 
	 	(D)	 	following such merger or
consolidation, the obligations of Guarantor under the Loan
Documents to which it is a party shall not be affected (and
without limiting the foregoing, such obligations shall remain
binding on Guarantor’s successor by such merger or
consolidation);
	 
	 	(E)	 	either (i) Guarantor shall be the
surviving entity and shall remain a Public Company, (ii) a
Public Company that is a Permitted Transferee shall be the
surviving entity, (iii) a Permitted Transferee which is required
by United States law to have and does have in place a program
reasonably acceptable to Agent to confirm compliance by it and
its investors with the Patriot Act and other laws relating to
money laundering and terrorism shall be the surviving entity or
(iv) if none of the foregoing clauses (i), (ii)
or (iii) apply, then prior to such merger or
consolidation, Borrower shall have informed Agent as to the
identity of the proposed merger or consolidation party, the
surviving entity and its investors and delivered to Agent such
information and entered into such modifications of the Loan
Documents as Agent reasonably requests to confirm Borrower’s,
Agent’s and Lenders’ on-going compliance with the Patriot Act
and other laws relating to money laundering and terrorism,




72









 






	 	 	 	including as a result of such merger or consolidation and any
future sales of direct or indirect interest occurring after
such merger or consolidation; and
	 
	 	(F)	 	with respect to any merger or
consolidation of Guarantor, if Guarantor is not the surviving
entity, then the surviving entity shall be primarily involved
in, or have a significant business line involving, the ownership
and operation of hotels.






          (iii) the Transfer of stock in Guarantor or Guarantor’s successor, as applicable, so
long as either it is a Public Company or if it is not a Public Company, then it shall have
in place a program reasonably acceptable to Agent to confirm compliance by it and its
investors with the Patriot Act and other laws relating to money laundering and terrorism;




          (iv) the Transfer of any limited partnership interest in Interstate Operating that is
not directly or indirectly held by Guarantor as of the Closing Date;




          (v) the pledge, mortgage, grant of a security interest in, hypothecation or encumbrance
of any direct or indirect interest in Interstate Operating other than as set forth in the
preceding clause (iv) provided that Borrower shall have given Agent prior notice
thereof, but not the foreclosure, transfer by assignment in lieu or other transfer of any
such direct or indirect interest in Interstate Operating pursuant to or in connection with
said pledges, security interests, hypothecations or encumbrances unless such transfer would
constitute a Permitted Transfer pursuant to clause (vi) of this Section
5.16(e);




          (vi) the sale, transfer, conveyance or assignment of any interest in Interstate
Operating other than as set forth in the preceding clause (iv) or (v)
provided that Borrower shall have given Agent prior notice of the foregoing, the obligations
of Guarantor under the Loan Documents to which it is a party shall not be affected by any of
the foregoing, after the foregoing, Borrower shall continue to comply with the terms of
Sections 4.34 and 5.33 hereof, none of the foregoing shall have a Material
Adverse Effect and (z) either:




	 	(A)	 	Guarantor, a Public Company that
is a Permitted Transferee, and/or a Permitted Transferee which
is required by United States law to have and does have in place
a program reasonably acceptable to Agent to confirm compliance
by it and its investors with the Patriot Act and other laws
relating to money laundering and terrorism shall control and
own, directly or indirectly, all legal and beneficial ownership
interests of Interstate Operating (other than those limited
partnership interests not owned by Guarantor as of the Closing
Date) or




73









 












	 	(B)	 	if the foregoing clause
(A) does not apply, then prior to such sale, transfer,
conveyance or assignment, Borrower shall have informed Agent as
to the identity of the proposed recipient of the foregoing and
its investors and delivered to Agent such information and
entered into such modifications of the Loan Documents as Agent
reasonably requests to confirm Borrower’s, Agent’s and Lenders’
on-going compliance with the Patriot Act and other laws relating
to money laundering and terrorism, including as a result of such
sale, transfer, conveyance or assignment and any future sales,
transfers, conveyances or assignments of direct or indirect
interest occurring after such sale, transfer, conveyance or
assignment.





          (f) “Permitted Transferee” shall mean any of the following entities (for purposes of
this definition, “control” shall have the meaning set forth in the definition of
“Affiliate” in this Section 1.1), provided that in each of the foregoing cases,
such entity would not cause the representations and warranties set forth in Section 4.34
hereof to be untrue:




               (i) a pension fund, pension trust or pension account that immediately prior to such transfer
owns, directly or indirectly, total real estate assets of at least $1,000,000,000;



               (ii) a pension fund advisor who (A) immediately prior to such transfer, controls, directly or
indirectly, at least $1,000,000,000 of real estate assets and (B) is acting on behalf of one or
more pension funds that, in the aggregate, satisfy the requirements of subclause (A) of
this clause (ii);



               (iii) an insurance company which is subject to supervision by the insurance commissioner, or a
similar official or agency, of a state or territory of the United States (including the District of
Columbia) (a) with a net worth, determined under GAAP as of a date no more than six (6) months
prior to the date of the transfer of at least $500,000,000 and (b) who, immediately prior to such
transfer, controls, directly or indirectly, real estate assets of at least $1,000,000,000;



               (iv) a corporation organized under the banking laws of the United States or any state or
territory of the United States (including the District of Columbia) (a) with a combined capital and
surplus of at least $500,000,000 and (b) who, immediately prior to such transfer, controls,
directly or indirectly, real estate assets of at least $1,000,000,000;



               (v) any Person (a) who has at least five (5) years’ experience in owning and/or operating at
least 1,000,000 square feet (exclusive of the Premises) of hospitality properties which comprise in
the aggregate at least 4,000 hotel rooms of similar size, scope, class, use and value of the
Premises, (b) who has a net worth, determined as of a date no more than six (6) months prior to the
date of such transfer, of at least $400,000,000 and (c) who, immediately prior to such transfer,
controls, directly or indirectly, real estate assets of at least $1,000,000,000;



74









 





               (vi) a real estate investment trust, bank, saving and loan association, investment bank,
insurance company, trust company, commercial credit corporation, investment fund, mutual fund,
government entity or plan, provided that any such Person referred to in this clause (vi)
(a) has total assets (in name or under management) in excess of $600,000,000 and (except with
respect to a pension advisory firm or similar fiduciary) capital/statutory surplus or shareholder’s
equity of $250,000,000 and (b) is regularly engaged in the business of making or owning commercial
real estate loans or loans similar in type as the Loan or operating commercial mortgage properties
similar to the Premises; or



               (vii) any Person in which at least 50.1% of the ownership interests are owned directly or
indirectly by one or more of the entities listed in clauses (i) through (vi) of
this Section 5.16(f), or any combination of more than one such entity, and which is
controlled directly or indirectly by such entity or entities.



          (g) There shall be no change in control (as defined in the definition of “Affiliate”
in this Section 1.1) of Borrower after the Closing Date except as provided in this
Section 5.16 and there shall be no Transfer of any direct interest in Borrower (it being
acknowledged that mergers and consolidations of Guarantor, and other Transfers of interests in
Guarantor, permitted under this Section 5.16 shall not be a “Transfer” of a direct interest
in Borrower).




          SECTION 5.17.    Defense of Title. Borrower shall do all things necessary or proper to defend
title to the Mortgaged Property and the other Collateral, subject to the Permitted Encumbrances,
but Agent shall have the right, at any time, to intervene in any suit affecting such title and/or
Agent’s lien or rights hereunder and to employ independent counsel in connection with any such suit
to which it may be a party by intervention or otherwise; and upon demand, Borrower shall pay Agent
all reasonable expenses paid or incurred by Agent in respect of any such suit, including Agent’s
Counsel Fees. Borrower shall indemnify and hold harmless Agent from and against any and all costs
and expenses, including any and all cost, loss, damage or liability which Agent may suffer or incur
by reason of the failure of the title to all or any part of the Premises or security interest in
the Collateral or by reason of the failure or liability of Borrower, for any reason, to convey or
grant a security interest in the rights, titles and interests which the Mortgage or other Security
Document purports to mortgage, assign, pledge or grant a security interest in, and all amounts at
any time so payable by Borrower shall be secured by the Security Documents.




          SECTION 5.18.    Recordation and Certain Taxes. Borrower, at its sole cost and expense, shall at
all times cause the Mortgage, Financing Statements and any other Security Document to be recorded,
registered or filed in the public records, and any amendments or supplements hereto and thereto,
and, if requested by Agent, any instruments of assignment hereof or thereof, to be recorded,
registered and filed, as applicable, and to be kept recorded, registered and filed, in such manner
and in such places, shall pay all recording, registration and filing fees and taxes and other
charges, including any recording, transfer or intangible personal property tax or similar
imposition, with respect thereto, and shall comply with all Legal Requirements in order fully and
effectively to establish, preserve, perfect and protect the lien of the Security Documents subject
only to Permitted Encumbrances. Borrower hereby authorizes Agent to file financing and
continuation statements with respect to the Collateral.




75









 








          SECTION 5.19.    Name, Fiscal Year and Accounting Method. Borrower shall not change its fiscal
year or, except as may be approved by Agent, its method of accounting or its name.




          SECTION 5.20.    Consolidation, Merger, Conveyance, Transfer or Lease. Without the prior consent
of Agent, Borrower shall not consolidate with or merge into any other Person or convey, transfer or
lease its properties or assets substantially as an entirety to any Person.




          SECTION 5.21.    Organization Restrictions. Borrower shall at all times be a Special Purpose
Bankruptcy Remote Entity. Without limiting the foregoing, Borrower shall not engage in any
business other than that related to the acquisition, ownership, construction, management,
development, financing, leasing, sale, maintenance, marketing and operation of the Premises in
accordance with the terms of the Loan Documents. Borrower shall not directly or indirectly make or
permit any change, amendment or modification to the Borrower Operating Agreement or other
organizational document of Borrower in any manner that (i) violates the single purpose covenants
set forth in this Section 5.21 or Exhibit D attached hereto or (ii) amends, modifies or
otherwise changes any provision thereof that cannot be modified at any time when the Loan is
outstanding or by its terms cannot be modified without Agent’s consent or that would constitute a
Default or Event of Default if amended, modified or otherwise changed pursuant to any other
provision of the Loan Documents, and such documents shall not be terminated or cancelled, without
the prior consent of Agent. Borrower shall not directly or indirectly take or permit any action
which could result in Borrower not being a Special Purpose Bankruptcy Remote Entity. Without
limiting Section 5.16 hereof, Borrower shall not permit any other Person to become a member
of Borrower except in connection with a Permitted Transfer.




          SECTION 5.22.    Changes in Zoning. Borrower shall not request or seek to obtain any change to, or
consent to any request for or change in, any Legal Requirement, restrictive covenant or other
restriction applicable to the Premises or any portion thereof or any other law, ordinance, rule,
regulation, restrictive covenant or restriction affecting the zoning, development or use of the
Premises or any portion thereof, or any variance or special exception therefrom, without the prior
consent of Agent.




          SECTION 5.23.    Limitation on Indebtedness. Borrower shall not incur, create, contract for,
waive, assume, have outstanding, guarantee or otherwise become liable with respect to Indebtedness
other than Permitted Indebtedness.




          SECTION 5.24.    Distributions, Dividends and Affiliate Payments. Borrower shall not directly or
indirectly make or allow to be made any dividends, payments or distributions to any direct or
indirect owner of any interest in Borrower or any Affiliate of Borrower or any such owner upon the
occurrence and during the continuance of any Event of Default or any Cash Sweep Condition;
provided, however, that payment of (i) management fees, if any, required to be paid
to any Property Manager pursuant to its Management Agreement of in the aggregate no more than three
percent (3.0%) of Operating Revenues per year shall be permitted (subject to the terms of the Cash
Management Agreement), (ii) reimbursement to Property Manager of Operating Expenses incurred by it
pursuant to the Management Agreement, (iii) Operating Expenses payable to an Affiliate of Borrower
pursuant to a transaction permitted by Section 5.29




76









 







hereof and (iv) payments, dividends or distributions made by Borrower to its direct or indirect
owners in order to reimburse them for Operating Expenses, Capital Expenditures and FF&E
Expenditures that had been advanced by them on behalf of Borrower, provided any such obligations to
such owners are subordinate to the Obligations and unsecured, notwithstanding the existence of any
Cash Sweep Condition so long as no Event of Default shall not have occurred and be continuing.




          SECTION 5.25.    ERISA. Borrower shall not at any time have any employees or engage in any
transaction which would cause any obligation or action taken or to be taken hereunder by Borrower
to be a non-exempt (under a statutory or administrative class exemption) prohibited transaction
under ERISA. Borrower (i) shall, and shall cause all ERISA Affiliates to make all required
contributions to any Pension Plan or Multiemployer Plan, and (ii) shall not, nor shall it permit
any ERISA Affiliate to, cause or permit to occur an event that could result in the imposition of a
Lien under IRC Section 412 or Section 302 or 4068 of ERISA, or any ERISA Event that could
reasonably be expected to, alone or in the aggregate with all other ERISA Events, result in a
material liability.




          SECTION 5.26.    Maintenance of Existence. Borrower shall (a) qualify to do business in and remain
in good standing under the laws of its jurisdiction of organization and the State where the
Premises are located and, to the extent required for the ownership, management and operation of its
assets, any other jurisdiction, (b) preserve, renew and keep in full force and effect its existence
as an entity organized and existing pursuant to the laws of its jurisdiction of organization and
qualified to do business in the State where the Premises are located, (c) take all action to
maintain all rights, privileges and franchises necessary or desirable for the conduct of its
business in its jurisdiction of organization and the State where the Premises are located, and, to
the extent required for the ownership, management and operation of its assets, any other
jurisdiction, and (d) comply in all material respects with all Legal Requirements with respect to
the foregoing.




          SECTION 5.27.    Subsidiaries and Joint Ventures. Borrower shall not acquire any stock or assets
of, or form a partnership, joint venture or other similar arrangement with, any Person, without
Agent’s prior consent.




          SECTION 5.28.    Loans to Members, Etc. Borrower shall not make any loan or advance to any
Affiliate or to any employee or Affiliate of Borrower, except for business travel, out-of-pocket
incidental personal business expenses and similar advances in the ordinary course of Borrower’s
business.




          SECTION 5.29.    Transactions with Affiliates. Borrower shall not enter into, or be a party to,
any transaction with any Affiliates of Borrower except contracts for the providing of goods and
services in the ordinary course of Borrower’s business and upon fair and reasonable terms which are
fully disclosed to Agent and are no more onerous to it than it would obtain in a comparable arm’s
length transaction with a Person not its Affiliate.




          SECTION 5.30.    Adverse Contracts. Borrower shall not enter into any contract or agreement which
would materially and adversely affect its business, property, assets,



77









 






operations, condition (financial or otherwise) taken as a whole, or its ability to perform its
obligations under this Loan Agreement or any of the other Loan Documents.




          SECTION 5.31.    Utilities. Borrower shall pay, or cause to be paid, all charges for all utility
services at any time rendered to the Premises, or the payment of which is the obligation of
Borrower in connection with the Premises, and will do all other things required for the maintenance
and continuance of utility services necessary for the operation, use and occupancy of the Premises
for their intended purposes in accordance with this Loan Agreement, and ensure that they are
available at the boundaries of the Premises.




          SECTION 5.32.    Margin Stock. Borrower shall not use any of the proceeds of the Loan for the
purpose of purchasing or carrying “margin stock” within the meaning of Regulation T, U or X issued
by the Board of Governors of the Federal Reserve System, as at any time amended, and Borrower
agrees to execute all instruments necessary to comply with all the requirements of Regulation U of
the Federal Reserve System, as at any time amended.




          SECTION 5.33.    Patriot Act Compliance. Borrower shall comply with the Patriot Act and all
applicable requirements of governmental authorities having jurisdiction over Borrower and the
Premises, including those relating to money laundering and terrorism. Agent shall have the right
to audit Borrower’s compliance with the Patriot Act and all applicable requirements of governmental
authorities having jurisdiction over Borrower and the Premises, including those relating to money
laundering and terrorism. In the event that Borrower fails to comply with the Patriot Act or any
such requirements of governmental authorities, then Agent may, at its option, cause Borrower to
comply therewith and any and all costs and expenses incurred by Agent in connection therewith shall
be secured by the Loan Documents and shall be payable on demand and shall accrue interest at the
Default Rate from the date paid or incurred by Agent until paid to Agent.




ARTICLE VI




EVENTS OF DEFAULT




          SECTION 6.1.    Events of Default. The following shall each constitute an “Event of
Default” hereunder:





     (a) the failure of Borrower to pay when due (i) the principal of and accrued, unpaid
interest on the Note upon maturity, whether upon the Maturity Date or earlier following
acceleration, (ii) any payment or deposit required pursuant to Section 2.4,
2.14, 2.15 or 2.16 hereof or (iii) any Interest or Additional Interest.




     (b) the failure of Borrower (i) to pay within five (5) days after same is due any
payment on account of any fees when due under the Loan Fee Letter, or (ii) to pay when due
any other monetary Obligations, excluding those referred to in clause (a) of this
Section 6.1 on or before the due date therefor and such failure described in this
subclause (ii) continues for five (5) Business Days after notice from Agent of the
non-payment thereof;



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     (c) Borrower shall fail in the due performance or observance of any covenant, agreement
or term binding upon Borrower contained in this Loan Agreement, other than those covenants,
agreements or terms which Borrower’s failure to perform would constitute another Event of
Default referred to in this Section 6.1, and such failure shall continue unremedied
for more than thirty (30) days after notice thereof shall have been given to Borrower by
Agent; provided, however, that if such failure is of a nature such that it
cannot be cured by the payment of money and if such failure requires work to be performed,
acts to be done or conditions to be removed which cannot by their nature, with due
diligence, be performed, done or removed, as the case may be, within such thirty (30) day
period and Borrower shall have commenced to cure such failure within such thirty (30) day
period, such period shall be deemed extended for so long as shall be required by Borrower in
the exercise of due diligence to cure such failure, but in no event shall such thirty (30)
day period be so extended to be a period in excess of ninety (90) days;




     (d) any “Event of Default” or any other default shall occur, and shall continue beyond
the applicable grace period, if any, provided for therein, under any of the Loan Documents
(other than this Loan Agreement, such a default being the subject of other provisions of
this Section 6.1), including an “Event of Default” under the Mortgage;




     (e) any warranty, representation or certification made by or on behalf of Borrower or
Guarantor in or pursuant to this Loan Agreement or any other Loan Document or any document,
instrument or certificate heretofore or hereafter executed or delivered in connection
herewith or therewith were incorrect or misleading in any material respect when made or
deemed to have been made;




     (f) any breach or default in any material respect by Borrower shall occur and shall
continue, beyond any applicable notice and grace period provided for therein, under the
Management Agreement, the Franchise Agreement, any Premises Document or any Permitted
Encumbrance or the occurrence of any other act or omission by Borrower, beyond any
applicable notice and grace period provided for therein, that would permit the other party
thereto to terminate same;




     (g) the Management Agreement, the Franchise Agreement, any Premises Document or any
Permitted Encumbrance is amended, modified or supplemented in any material respect or is
surrendered, terminated or canceled, or any new Management Agreement, Franchise Agreement,
Premises Document or Permitted Encumbrance is entered into, or Borrower consents to the
assignment of the Management Agreement or Franchise Agreement, without in each case the
prior consent of Agent, not to be unreasonably withheld or delayed to the extent provided in
Section 5.2 hereof;




     (h) any breach or default by Borrower shall occur and shall continue, beyond any
applicable notice and grace period provided for therein, under any Interest Rate Protection
Agreement, or the occurrence of any other act or omission by Borrower, beyond any applicable
notice and grace period provided for therein, that would permit the other party thereto to
terminate same;



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     (i) either Borrower or Guarantor shall (i) voluntarily commence any proceeding or file
any petition seeking liquidation, reorganization or other relief under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect,
(ii) consent to the institution of, or fail to contest in a timely and appropriate manner,
any such proceeding or petition, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for Borrower or
Guarantor or for a substantial part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding or (v) make a
general assignment for the benefit of creditors;




     (j) an involuntary proceeding shall be commenced or an involuntary petition shall be
filed seeking (i) liquidation, reorganization or other relief in respect of either Borrower
or Guarantor or its debts, or of a substantial part of its assets, under any Federal, state
or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or
(ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar
official for either Borrower or Guarantor or for a substantial part of its assets, and, in
any such case, such proceeding or petition shall continue undismissed for sixty (60) days or
an order or decree approving or ordering any of the foregoing shall be entered;




     (k) Borrower shall fail in the due performance and observance of any of its covenants
contained in Sections 2.6, 5.6 (with respect only to the covenant to pay
Impositions as and when required therein and subject to Borrower’s contest rights in
Section 5.8 hereof), 5.7 (subject to Borrower’s contest rights in
Section 5.8 hereof), 5.10(a), 5.11(a), 5.11(b),
5.11(c), 5.16, 5.20 or 5.26(a) hereof;




     (l) Borrower shall fail in the due performance and observance of any of its covenants
contained in Section 5.1(a), (b), (c), (d) or (e),
5.23 or 5.24 hereof, or in any material respect, its covenants contained in
Section 5.21 hereof and such failure shall continue unremedied for more than ten
(10) days after notice thereof shall have been given to Borrower by Agent;




     (m) any of the Loan Documents or the Liens created (or purported to be created)
pursuant thereto shall for any reason cease to be in full force and effect, or be declared
null and void or unenforceable in whole or in part;




     (n) the Liens created (or purported to be created) by the Mortgage or any other Loan
Documents should cease to be first priority Liens subject only to the Permitted
Encumbrances;




     (o) there shall have been rendered against Borrower a final judgment(s) for the payment
of money in excess of $1,000,000 in the aggregate, and in each case any such judgment(s)
shall not have been satisfied within thirty (30) days after the entry of such judgment(s);
or




     (p) (i) Borrower or Guarantor shall have incurred any liability, or an event or action
shall have occurred that could reasonably be expected to cause Borrower or



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Guarantor to incur any liability, (x) with respect to any Pension Plan, including any
liability under Section 412 of the IRC or Title IV of ERISA, or (y) on account of a partial
or complete withdrawal (as such terms are defined in Section 4203 and 4205 of ERISA,
respectively) from, unpaid contributions to, or the reorganization, termination or
insolvency of, any Multiemployer Plan, or (ii) Borrower or Guarantor shall have engaged in
any transaction in connection with which Borrower or Guarantor could be subject to either a
material civil penalty assessed pursuant to the provisions of Section 502 of ERISA or a
material tax imposed under the provisions of Section 4975 of the IRC, and in each case in
subclauses (i) and (ii) of this clause (p), such event or condition,
together with all other such events or conditions under this clause (p), if any,
could reasonably be expected to have a material adverse effect upon the Collateral or the
business, operations, properties, assets, condition (financial or otherwise), prospects or
performance of Borrower or Guarantor that would materially and adversely affect the
Collateral or Borrower’s or Guarantor’s ability to perform its respective obligations
hereunder or under any other Loan Document or which would materially and adversely impair
the ability of Agent to enforce or collect any of the Obligations.



          SECTION 6.2.    Acceleration of Loan. In addition to any other rights and remedies which Agent and
Lenders may have under this Loan Agreement and the other Loan Documents or pursuant to law or
equity, and without limitation thereof, upon and at any time during the occurrence of any Event of
Default, Agent may, by notice to Borrower, declare the indebtedness evidenced by the Note, together
with all other sums payable thereunder and under the other Loan Documents, immediately due and
payable (except with respect to any event of the nature described in Section 6.1(i) or
(j) hereof, with respect to which such indebtedness and other sums shall automatically
become due and payable upon the occurrence of any such event) and may exercise Agent’s rights and
remedies pursuant to any one or more of the Security Documents, the other Loan Documents or as may
be available at law or equity.




          SECTION 6.3.    Rights and Remedies Generally. Upon the occurrence and during the continuance of
an Event of Default, Agent may proceed to exercise and enforce any of its rights, interests,
benefits or privileges hereunder or under any of the other Loan Documents or which may be otherwise
available to Agent at law or in equity. Notwithstanding anything to the contrary in the Loan
Documents (and without limitation of the above), in lieu of and/or in addition to the other rights
and remedies of Agent under the Loan Documents, Agent shall have all of the rights and remedies
provided by the Uniform Commercial Code which shall be applicable to and/or available in connection
with Agent’s and Lender’s security interests in the Collateral, including the Accounts. To the
extent, if any, that applicable law requires that a notice need be given or any other action on
Agent or Lender’s part (which is not specified in the Loan Documents) need be taken in order for
Agent to realize the full benefit of any of Agent’s and Lenders’ rights and/or remedies under the
Loan Documents, and Agent does provide such notice and/or take such other action so required, then
such rights and/or remedies shall not be severed or impaired as a result of the absence of an
express provision in the Loan Documents specifically requiring such notice or action. Further,
notwithstanding anything to the contrary in any of the Loan Documents, Agent may choose to waive or
to forego the benefits of any of its particular rights and/or remedies under the Loan Documents
without otherwise adversely affecting any of its other rights or remedies.




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          SECTION 6.4.    Agent’s Right to Operate; Sums Advanced.




          (a) Agent’s Right to Operate. In addition to any other rights and remedies which Agent may
have under this Loan Agreement and the other Loan Documents or pursuant to law or equity, and
without limitation thereof, after the occurrence and during the continuance of any Event of
Default, Agent may enter upon and into possession of the Premises and any other Collateral, perform
the obligations and exercise the rights of Borrower under the Management Agreement, the Franchise
Agreement, any Premises Documents, any Permitted Encumbrance, any Lease and all other agreements,
satisfy liens, claims and judgments against the Collateral, pay Impositions, insurance premiums and
other operating expenses of any of the Premises and/or perform and complete the construction,
reconstruction, maintenance or renovation of and otherwise operate, lease, market and sell the
Premises or any portion thereof, all at the sole risk, cost and expense of Borrower. Agent shall
have the right, at any and all times, to discontinue any work commenced by Agent and to change any
course of action undertaken by it and shall not be bound by any limitations or requirements of time
whether set forth herein or otherwise. Agent shall have the right and power (but shall not be
obligated) to assume all or any portion of the obligations of Borrower under any or all agreements
as Agent may elect and to take over and use all or any part or parts of the labor, materials,
supplies and equipment contracted for by or on behalf of Borrower, whether or not previously
incorporated into the Premises. Borrower hereby appoints Agent as its attorney-in-fact (coupled
with a interest), with full power of substitution, and in the name of Borrower, if Agent elects to
do so, at any time upon the occurrence and during the continuance of any Event of Default, (a) to
use such sums as are necessary including all or any portion of the funds in the Accounts to pay the
costs of the foregoing, (b) to endorse the name of Borrower on any checks or drafts representing
proceeds of the Insurance Policies or condemnation awards, or other checks or instruments payable
to Borrower with respect to the Collateral, (c) to prosecute or defend any action or proceeding
incident to the Collateral, (d) to terminate any agreements pertaining to the Collateral or any
portion thereof and any other agreements to which Borrower is party, (e) to negotiate and execute,
on behalf of Borrower at Agent’s election, any agreement, and amendment, modification, extension or
supplement thereto and (f) to do every act with respect to its Premises, including the alteration,
repair, construction, reconstruction, maintenance, leasing, operation, marketing and sale thereof
or any portion thereof. The power-of-attorney granted hereby is a power coupled with an interest
and is irrevocable. Agent shall have no obligation to undertake any of the foregoing actions, and
if Agent should do so, it shall have no liability to Borrower for the sufficiency or adequacy of
any such actions taken by Agent. In connection with the foregoing, Agent may do any or all of the
following as Agent may elect:





	 	(i)	 	engage builders, construction managers,
architects, general and trade contractors, suppliers, lessors,
architects, engineers, inspectors and others for the purpose of
furnishing labor, materials, furniture, fixtures and equipment in
connection with the construction of the Premises;
	 
	 	(ii)	 	pay, settle or compromise all bills or claims
which may become Liens against the Premises, or which have been or may
be incurred in any manner in connection with the construction of the
Premises




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	 		 	or for the discharge of liens, encumbrances or defects in the title
of the Premises;
	 
	 	(iii)	 	execute all applications and certificates
which may be required for any alteration, repair or renovation of or
the completion of construction, reconstruction, maintenance or
renovation of the Premises or any portion thereof or for the operation
of the Collateral or any portion thereof;
	 
	 	(iv)	 	take such other action (including the
employment of watchmen and the taking of other measures to protect the
Premises) or refrain from acting under this Loan Agreement as Agent may
in from time to time determine without any limitation whatsoever; and
	 
	 	(v)	 	make or cause Lenders to make protective
advances in order to maintain, preserve and protect the Collateral.





          (b) Sums Advanced. Borrower shall be liable to Agent and Lenders for all sums advanced, paid
or incurred in connection with the activity described in Section 6.4(a) hereof whether the
same shall be paid or incurred pursuant to the provisions of this Section 6.4 or otherwise,
and all other payments made or liabilities incurred by Agent or Lenders under this Loan Agreement
of any kind whatsoever, all of which shall be paid by Borrower to Agent upon demand with interest
at the Default Rate from the time incurred by Agent or Lenders to the date of payment to Agent, and
all of the foregoing sums, including such interest at the Default Rate, shall be deemed and shall
constitute disbursements of Loan proceeds under this Loan Agreement and be evidenced by the Note
and secured by the Security Documents.




          SECTION 6.5.    Assignment of Funds. Upon the occurrence of any Event of Default, the rights,
powers and privileges provided in Sections 6.3 and 6.4 hereof and all other
remedies available to Agent under this Loan Agreement or the other Loan Documents or by statute or
by rule of law or equity may be exercised by Agent at any time and from time to time whether or not
the Obligations shall be due and payable, and whether or not Agent shall have instituted any
foreclosure or other action for the enforcement of any of the Security Documents, the Note or the
other Loan Documents. Borrower hereby assigns and quitclaims to Agent all right, title and
interest of Borrower to all sums held in the Accounts and to the extent not held in an account, all
sums held by Agent for the account of Borrower and any other security delivered by Borrower as
additional security (a security interest in all of the foregoing being granted hereby to Agent) for
the Loan and the performance by Borrower of its obligations under the Loan Documents, all of which
security may be utilized by Agent for the purposes set forth in Sections 6.3 and
6.4 hereof or the other Loan Documents or applied against the Obligations in such order and
manner as Agent shall determine.




          SECTION 6.6.    Accounts. Notwithstanding anything to the contrary contained herein, after the
occurrence and during the continuance of an Event of Default, the rights of Borrower and each and
every other Person (excluding Agent) with respect to Accounts, upon notice to Borrower, shall
immediately terminate, and no such Person except Agent shall make any further withdrawal therefrom.
Thereafter, Agent may from time to time designate such



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signatories with respect to the Accounts as Agent may desire, and may make or authorize withdrawals
from the Accounts to pay the Obligations in whole or in part and/or pay costs, expenses and
expenditures with respect to the Premises, including the leasing, sale and marketing thereof,
and/or any other expenses, all as Agent may deem necessary or appropriate and in such order as
Agent may elect. Agent may notify the financial institutions in which any Account is held that
Borrower no longer has a right to instruct such financial institution with respect to matters
relating to the withdrawal, operation or administration of, or investment or application of funds
on deposit in such Account. Without limiting the foregoing Agent shall have the right to cause the
withdrawal of all funds on deposit in any Account and the deposit of such funds in an account
established with Agent at any time following receipt by the financial institution in which such
Account is held of a notice from Agent pursuant to the Account Agreement with respect to such
Account, and Borrower hereby authorizes and directs such financial institutions to make payment
directly to Agent of the funds in or credited to such accounts, or such part thereof as Agent may
request. Such financial institution shall have the absolute right to rely upon such notice without
inquiring as to the accuracy of the matters referred to in such notice and the depositories shall
be fully protected by Borrower in relying upon such written notice from Agent. In the event that
Agent delivers such a notice, Agent shall thereafter have the exclusive right to so instruct such
financial institution. Nothing in this Section 6.6 shall be construed so as to limit or
impair Agent’s absolute right to have a receiver appointed following an Event of Default.




          SECTION 6.7.    No Liability of Agent or Lenders. Whether or not Agent elects to employ any or all
of the remedies pursuant to the Loan Documents or otherwise available to it at law or equity upon
the occurrence of a Default or an Event of Default, neither Agent nor Lenders shall be liable for
any matter relating to the Premises or any rights or obligations of Borrower or its Affiliates,
including the rights and obligations of Borrower in, to or under the Management Agreement, the
Franchise Agreement, any Premises Documents, any Permitted Encumbrance, any Lease or any other
agreement, or to protect the Premises or the Collateral, or for payment of any expense incurred in
connection with the exercise of any remedy available to Agent or for the performance or
non-performance of any other obligation of Borrower. It is expressly understood that Agent and
Lenders assume no liability or responsibility for (i) performance of any obligations or duties of
Borrower hereunder or under any of the other Loan Documents, the Management Agreement, the
Franchise Agreement, any Premises Documents, any Permitted Encumbrance, any Lease or any other
agreement, (ii) compliance with any Legal Requirements or (iii) any other matters pertaining to
control over the management and affairs of Borrower or the use, operation, management or ownership
of the Premises or the Collateral, nor by any such action shall Agent or any Lender be deemed to
create a partnership or joint venture with Borrower.




          SECTION 6.8.    Management Agreement and Affiliate Agreements. Without limiting any other
provision herein or in any other Loan Document, upon the occurrence and during the continuance of
any Event of Default, in addition to any other rights or remedies of Agent hereunder or under the
other Loan Documents, Agent may terminate the Management Agreement and any agreement entered into
with any Affiliate of Borrower and/or may require that Borrower terminate the Management Agreement
and/or such agreements effective on or after the foreclosure of the Mortgage, or as of the date of
delivery to Agent of any deed in lieu of



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such foreclosure, or as of the date that a receiver is appointed for the Premises, whichever occurs
first.




          SECTION 6.9.    Right of Offset. Borrower hereby grants to Agent and Lenders a right of offset, to
secure the repayment of the Obligations, upon any and all monies, securities or other property of
Borrower, and the proceeds therefrom, now or hereafter held or received by or in transit to Agent
and any Lender, from or for the account of Borrower, whether for safekeeping, custody, pledge,
transmission, collection or otherwise, and also upon any and all deposits (general or special) and
credits of Borrower (including each Account), and any and all claims of Borrower against Agent or
any Lender at any time existing. At any time during the continuance of an Event of Default or
following the maturity (whether by acceleration or otherwise) of the Loan, Agent and each Lender is
hereby authorized from time to time, without notice to Borrower, to offset, appropriate, apply and
enforce said liens against any and all sums hereinabove referred to against the Loan and the
remaining Obligations. Except as results from Agent’s or any Lender’s gross negligence or willful
misconduct, Agent and Lenders shall not be liable for any loss of interest on or any penalty or
charge assessed against funds in, payable on, or credited to any Account as a result of the
exercise by Agent of any of its rights, remedies or obligations under any of the Loan Documents.




          SECTION 6.10.    Termination of Loan Agreement. The obligations of the parties hereunder,
excluding those which expressly survive the termination hereof or repayment of the Loan, shall
terminate only upon repayment in full of the outstanding principal amount of the Loan, together
with all Interest and other sums due and payable under the Loan Documents (excluding any contingent
obligations which may remain outstanding under the Environmental Indemnity or the Recourse
Liability Agreement). If such principal, Interest and other sums have been repaid and thereafter
such all or any portion of such payment is rescinded or must otherwise be returned or paid over by
Agent or any Lender, whether required pursuant to any bankruptcy or insolvency law or otherwise,
the Obligations and the obligations of each party under the Loan Documents, shall continue.




          SECTION 6.11.    Right to Perform. Upon the occurrence and during the continuance of an Event of
Default, if Borrower fails to perform or observe any covenant or obligation whatsoever contained in
any Loan Document, in addition to any other rights or remedies of Agent hereunder or under the
other Loan Documents, Agent may, but shall not be obligated to any Person to, perform or attempt to
perform said covenant or obligation, and any payment made or expense incurred in the performance or
attempted performance of any such covenant or obligation shall be a part of the Obligations, and
Borrower shall pay to Agent, upon demand, all sums so advanced or paid by Agent, together with
interest at the Default Rate from the date when paid by Agent. No such payment or advance by Agent
shall constitute a waiver of any Default or Event of Default. In addition to the Liens created
pursuant to the Loan Documents, Agent shall be subrogated to all rights, titles and Liens securing
the payment of any debt, claim, tax or assessment for the payment of which Agent may make and
advance or which Agent may pay. Without limiting the generality of the foregoing, upon the
occurrence and during the continuance of an Event of Default, if Borrower fails to perform or
observe any term of any the Management Agreement, the Franchise Agreement, any Premises Documents,
any Permitted Encumbrance, any Lease, the Management Agreement or any other agreement to be
performed or observed by it thereunder, then, without waiving or releasing Borrower from any of



85









 






its obligations hereunder or under the other Loan Documents, Agent shall have the right, but shall
be under no obligation, to pay any sum and to take any action (including entry upon the Mortgaged
Property) to cause such performance or observance on behalf of Borrower , so that the rights of
Borrower are unimpaired and free from default, even if the existence or the nature of a default is
being questioned or denied by Borrower or any other Person. Agent shall be subrogated to the
rights of the parties to such agreements with respect to any such sums paid by Agent. Borrower
shall pay to Agent upon demand all such sums so paid or expended by Agent, together with interest
thereon from the day of such payment at the Default Rate, and the same shall be secured by the Loan
Documents. If Agent receives a notice of a default, such notice shall constitute full protection
to Agent and Lenders for any action taken or omitted by Agent, in good faith, in reliance thereon.
Agent may rely thereon and take any action as Agent shall deem necessary or desirable even though
the existence of such default or the nature thereof be questioned or denied by or on behalf of
Borrower.




ARTICLE VII




ASSIGNMENTS AND PARTICIPATIONS




          SECTION 7.1.    Assignment and Participations. Agent and Lenders shall have the right, subject to
this Section 7.1, to assign, sell, negotiate, pledge or hypothecate all or any portion of
their rights and obligations hereunder. No Lender shall assign, sell, negotiate, pledge,
hypothecate or otherwise transfer all or any portion of its rights in and to the Loan to any other
Person (an “Assignee”) (a) without Agent’s prior consent (b) other than in compliance with
Section 7.5 hereof and (c) unless such transaction shall be an assignment of a constant
(and not varying), ratable percentage of such Lender’s interest in the Loan; provided,
however, any Lender shall have the right at any time without the consent of or notice to
Agent, any other Lender or other Person to grant a security interest in, pledge, assign or
otherwise transfer all or any portion of such Lender’s interest in the Note or the Loan to any
Federal Reserve Bank or the central reserve bank or similar authority of any other country to
secure any obligation of such Lender to such bank or similar authority (a “Central Bank
Pledge”) and to the trustee, administrator or receiver (or their respective nominees,
collateral agents or collateral trustees) of a mortgage pool securing covered mortgage bonds issued
by a German mortgage bank, or any other Person permitted to issue covered mortgage bonds, under
German Pfandbrief legislation, as such legislation may be amended and in effect from time to time,
or any substitute or successor legislation (a “Pfandbrief Pledge”). Effective on any such
assignment and assumption by the assignee and on compliance with Section 7.5 hereof, the
assigning Lender shall have no further liability hereunder with respect to the interest of such
Lender that was the subject of such transfer arising from and after the date of such assignment and
assumption and such Assignee shall be a Lender with respect to such interest from and after the
date of such assignment and assumption. No assignment and assumption shall release any Lender from
any liability hereunder prior to such assignment and assumption.




          SECTION 7.2.    Participation. No Lender shall assign, sell or otherwise transfer a participation
in and to all or any portion of its rights and obligations in and to the Loan, this Loan Agreement
or the other Loan Documents to any other Person (a “Participant”) without the prior consent
of Agent. No such participation shall (i) require the consent of any Lender,



86









 






Borrower or any other Person or (ii) release a Lender from any of its obligations hereunder. Each
Lender agrees to provide Agent prompt notice of all participations sold by such Lender together
with a copy of the documentation governing such participations.




          SECTION 7.3.    Availability of Records. Borrower acknowledges and agrees that Agent and each
Lender may provide to any actual or proposed Assignee or Participant originals or copies of this
Loan Agreement, any other Loan Documents and any other documents, instruments, certificates,
opinions, insurance policies, financial statements and other information, letters of credit,
reports, requisitions and other materials and information at any time submitted by or on behalf of
Borrower, Guarantor or other Persons and/or received by Agent or any Lender in connection with the
Loan.




          SECTION 7.4.    Borrower’s Facilitation of Transfer.




          (a) In order to facilitate permitted assignments and other transfers to Assignees and sales to
Participants, Borrower shall execute and deliver to Agent and shall cause Guarantor to execute and
deliver to Agent such further documents, instruments or agreements as Agent or any Lender may
reasonably require, including one or more substitute promissory notes evidencing the Commitment of
each Lender, provided that such documents, instruments or agreements do not (a) increase the
obligations or liabilities of any such Person hereunder or under the other Loan Documents in excess
of the obligations or liabilities intended to be provided herein or in the other Loan Documents or
(b) decrease such Person’s rights hereunder or under the other Loan Documents to less than what
they were prior to the execution of such documents, instruments or agreements. In addition,
Borrower agrees to reasonably cooperate with Agent and Lenders, including providing such
information and documentation regarding Borrower, Guarantor and any other Person as Agent or any
Lender or any potential Assignee or Participant may reasonably request and to meet with potential
Assignees and Participants upon reasonable notice.




          (b) All at Lenders’ expense, Agent shall have the right, at any time (whether prior to, in
connection with, or after any permitted assignment, participation and other transfers to Assignees
and sales to Participants), with respect to all or any portion of the Loan, to modify, split and/or
sever all or any portion of the Loan as hereinafter provided, and Borrower shall cooperate and
cause Guarantor and each Affiliate of Borrower to cooperate with Agent in connection therewith.
Without limiting the foregoing, Agent may (i) cause the Note, the Mortgage and the other Loan
Documents to be split into multiple mortgage loans, (ii) create one more senior and subordinate
notes (e.g., an A/B or A/B/C structure), (iii) create multiple components of the Note or Notes (and
allocate or reallocate the principal balance of the Loan among such components and/or assign
different interest rates and/or LIBOR, eurodollar and/or Base Rate spreads to each Note), which
components may be represented by separate Notes or (iv) otherwise sever the Loan into two or more
loans secured by mortgages and by a pledge of partnership or membership interests (directly or
indirectly) in Borrower (i.e., a senior loan/mezzanine/subordinate mortgage loan structure), in
each such case, in whatever proportion and whatever priority Agent determines; provided,
however, in each such instance the outstanding principal balance of all the Notes
evidencing the Loan (or components of such Notes) immediately after the effective date of such
modification equals the outstanding principal balance of the Loan immediately prior to such
modification and the weighted average of the



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interest rates for all such Notes (or components of such Notes) immediately after the
effective date of such modification equals the overall weighted average LIBOR Rate and Base Rate,
as applicable, immediately prior to such modification; provided, further,
however, all prepayments or repayments shall be applied to such tranches in a manner which
shall not increase the weighted average interest rate of the Loan. If requested by Agent, Borrower
shall, and cause Guarantor and each applicable Affiliate of Borrower to, execute and deliver such
documentation as Agent may reasonably request to evidence and/or effectuate any such modification
or severance. None of the foregoing documents, instruments or agreements shall (a) increase the
obligations or liabilities of any Borrower hereunder or under the other Loan Documents in excess of
the obligations or liabilities intended to be provided herein or in the other Loan Documents or
(b) decrease Borrower’s rights hereunder or under the other Loan Documents to less than what they
were prior to the execution of such documents, instruments or agreements.




          SECTION 7.5.    Notice; Registration Requirement. No assignment, sale, negotiation, pledge,
hypothecation or other transfer of any part of any Lender’s interest in and to the Loan shall be
effective or permitted under this Article VII until (a) an assignment and acceptance
agreement in the form attached hereto as Schedule 7.5 (an “Assignment and
Acceptance”) with such changes thereto as are reasonably acceptable to Agent with respect to
such assignment, sale, negotiation, pledge, hypothecation or other transfer shall have been
delivered to Agent, (b) two (2) originals of the tax documents referred to in Section 2.8 hereof
applicable to the Assignee shall have been delivered to Agent, (c) Agent shall have registered such
Assignee’s name and address in the Register which Agent maintains for the recordation of the names,
addresses and interests of Lenders, and (d) the parties to such transfer, assignment or purchase
shall have paid to Agent a processing and registration fee determined by Agent. The entries in the
Register shall be conclusive, absent manifest error. This Section 7.5 shall not apply to
any Central Bank Pledge or, unless it is an assignment or transfer, any Pfandbrief Pledge. Each
Lender shall from time to time deliver to Agent at its request such additional and updated tax
documentation described in Section 2.8 hereof.




          SECTION 7.6.    Registry. Borrower hereby designates Agent to serve as Borrower’s agent, solely
for purposes of this Section 7.6, to maintain a register (the “Register”) on which
Agent will record the Commitments from time to time of each Lender and each repayment with respect
to the principal amount of the Loan of each Lender. Failure to make any such recordation, or any
error in such recordation shall not affect Borrower’s obligations in respect of the Loan. With
respect to any Lender, the transfer of the Commitments of such Lender and the rights to the
principal of, and interest on, the portions of the Loan made pursuant to such Commitments shall not
be effective until such transfer is recorded on the Register maintained by Agent with respect to
ownership of such Commitments and prior to such recordation all amounts owing to the transferor
with respect to such Commitments shall remain owing to the transferor. The registration of a
transfer of all or part of any Commitment shall be recorded by Agent on the Register only upon the
acceptance by Agent of a properly executed and delivered Assignment and Acceptance by the assignor
and assignee. At the assigning Lender’s option, concurrently with the delivery of an Assignment
and Acceptance pursuant to which an interest of such Lender in the Loan was assigned to such
Assignee, the assigning Lender shall surrender its Note evidencing the portion of the Loan
corresponding to the interest so transferred and Borrower shall deliver to Agent one or more new
promissory notes in the same aggregate principal amount issued to the assigning Lender and/or the
Assignee.




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          SECTION 7.7.    Disclosure by Agent or Lender. Without limiting Section 7.3 hereof,
Borrower consents to the issuance by Agent and Lenders of press releases, advertisements and other
promotional materials in connection with the marketing activities of Agent and Lenders, including
the disclosure that PB Capital Corporation is the Agent for the Loan, the amount of the Loan and
the name, location and use of the Premises.




          SECTION 7.8.    Interest Rate Protection Agreements. Each Lender that is a party to any Interest
Rate Protection Agreement acknowledges that the interest of Borrower in and to such Interest Rate
Protection Agreement will be pledged and collaterally assigned to Agent pursuant to the Loan
Documents, and hereby consents without any restrictions to such pledge and collateral assignment.
All payments, if any, due under such Interest Rate Protection Agreement shall be paid directly to
Agent and all other rights of Borrower shall, upon the occurrence and during the continuance of an
Event of Default, be exercisable by Agent. Each Lender that is a party to any Interest Rate
Protection Agreement shall execute and deliver to Agent, and cause any Affiliate of such Lender
that is a party to any Interest Rate Protection Agreement to execute and deliver to Agent, upon
entering into such agreement the Interest Rate Protection Agreement Consent in order to confirm the
foregoing.




ARTICLE VIII




AGENT AND LENDERS




          SECTION 8.1.    Scope of Article XIII. This Article VIII shall be binding on Agent and
Lenders, but shall not be binding on or enforceable by Borrower unless otherwise expressly provided
herein. As among Agent and Lenders, the provisions of this Article VIII may be amended,
waived or otherwise modified by Agent and Lenders without Borrower’s consent and without the need
for Borrower to be party to any of the same. Without limiting the foregoing, nothing contained in
this Article VIII or any amendments, waivers or modifications thereof by Agent and Lenders,
shall limit or modify the rights and obligations of, and restrictions applicable to, Borrower,
Agent or Lenders set forth in any other provision of this Loan Agreement or in the other Loan
Documents, except as among Agent and Lenders.




          SECTION 8.2.    Agent.




          (a) Appointment. Each Lender hereby irrevocably designates and appoints Agent as the agent of
such Lender with respect to the Loan and to act as “Agent” under the Loan Documents. Each Lender
hereby irrevocably authorizes Agent, as its agent, to take such action and to exercise such powers
on such Lender’s behalf as may be taken by Agent under any Loan Document, including as a payee,
mortgagee, assignee or beneficiary or otherwise, together with such other powers as are reasonably
incidental thereto. Nothing contained in this Loan Agreement, any Assignment and Acceptance or in
any other Loan Document is intended to create or shall be construed as imposing on Agent any
obligations except as expressly set forth in this Loan Agreement or in any other Loan Document.
Agent shall not have any fiduciary or trustee relationship with Lenders.




          (b) Duties of Agent. Agent shall not have any duties or responsibilities except those
expressly set forth in this Loan Agreement and in the other Loan Documents; no



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implied covenants, functions, responsibilities, duties, obligations or liabilities of Agent
shall be construed to exist under this Loan Agreement or any other Loan Document. Agent shall
perform its duties hereunder in accordance with the same standard of care as that customarily
exercised by Agent with respect to the administration of a loan similar to the Loan held entirely
for its own account. Agent shall not have any duty to ascertain or inquire into or verify the
performance or observance of any covenants or agreements in any Loan Documents by Borrower or any
other Person or the satisfaction of any condition or to inspect the Premises. Agent shall not be
liable for any undertaking of Borrower or any other Person or for any error of judgment, or for any
action taken or omitted to be taken by Agent other than willful misconduct or gross negligence of
Agent.




          (c) Reliance by Agent. Agent is entitled to rely upon (and shall be protected in relying
upon) any written or oral statement and notices or any other certification or documents believed by
Agent to be genuine and correct and to have been signed or made by the proper Person and, with
respect to all of its duties under the Loan Documents, upon advice of counsel (including counsel
for Borrower and Guarantor), independent public accountants, engineers, architects and other
experts selected by Agent and shall not be liable for any action taken or omitted to be taken by
Agent in good faith in accordance with the advice of such counsel, independent public accountants,
engineers, architects and other experts.




          (d) Delegation of Duties. Agent may execute any of its duties under this Loan Agreement and
any duties as Agent or as a party, payee, mortgagee, assignee or beneficiary under any Loan
Document, by or through agents, affiliates or attorneys-in-fact. Agent shall not be responsible
for the negligence or misconduct of any agents, affiliates or attorneys-in-fact selected by Agent
with reasonable care and prudence.




          (e) Agent in its Capacity as a Lender. With respect to PB Capital Corporation’s ownership
interest in the Loan as a Lender, PB Capital Corporation in its capacity as Lender shall have the
rights and powers of a Lender under this Loan Agreement and the other Loan Documents as set forth
herein and therein and may exercise or refrain from exercising the same as though it were not
Agent, and the term “Lender” and “Lenders” shall include PB Capital Corporation in its individual
capacity for so long as PB Capital Corporation shall hold any interest in the Loan. The foregoing
shall also apply to any future Agent that is also a Lender.




          (f) Relationship with Borrower. Each Lender acknowledges that, with respect to the Loan and
the Loan Documents, Agent shall have the sole and exclusive authority to deal and communicate with
Borrower and any other Person on behalf of Lenders and each Lender acknowledges that any notices or
demands from such Lender to Borrower or such Person must be promptly forwarded to Agent for
delivery. Each Lender agrees that it will not take any legal action, nor institute any actions or
proceedings, against Borrower or any other Person with respect to any of the Obligations, without
the prior consent of Agent, which consent may be withheld by Agent in its discretion.




          SECTION 8.3.    Distributions. Each Lender shall be entitled to receive, and Agent shall transfer
to each Lender, each Lender’s Pro Rata Share of all payments received by Agent pursuant to the Loan
Documents on account of principal, interest and other sums, excluding, however, (a) any sums
payable to Agent or any Lender in a manner other than in



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proportion to each Lender’s Pro Rata Share in connection with any Interest Rate Protection
Agreement or pursuant to Section 2.9 or 2.15 hereof, without regard as to whether
such sums constitute Additional Interest, (b) any sums payable pursuant to the Loan Fee Letter, and
(c) any sums payable to Agent in its capacity as Agent, including any sums payable on account of
expenses incurred by Agent which Borrower is obligated to reimburse Agent pursuant to the Loan
Documents to the extent that Lenders have not made a payment on account thereof pursuant to
Section 8.9 hereof (the sums referred to in clauses (a) through (c) are
hereinafter referred to as, “Excluded Sums”).




          SECTION 8.4.    Authority, No Reliance; Binding Effect. Each Lender (a) represents and warrants
that it is legally authorized to enter into this Loan Agreement, (b) agrees that neither Agent nor
any Lender shall be responsible to one another for the due execution, legality, validity,
enforceability, genuineness, sufficiency or collectibility of any of the Loan Documents or any
other instrument or document furnished pursuant thereto or in connection with the Obligations, or
for the performance or the observance by Borrower, Guarantor, any of their respective Affiliates or
any other obligor of any of their respective obligations under the Loan Documents or any other
instrument or document furnished pursuant thereto or in connection with the Obligations,
(c) confirms and agrees that neither Agent nor any Lender has made or will be deemed to have made
any warranty or representation to another or shall be responsible to another for any statements,
warranties or representations (written or otherwise) made in or in connection with the Loan or the
Loan Documents or for the financial condition of Borrower or any other Person or for the title or
the value of any portion of the Mortgaged Property or other Collateral and (d) agrees that it will
be bound by the provisions of this Loan Agreement and the other Loan Documents and will perform in
accordance with its terms all the obligations which by the terms of this Loan Agreement and the
other Loan Documents are required to be performed by it as a Lender. Each Lender acknowledges that
it has, independently and without reliance upon Agent or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own credit analysis and decision
to enter into this Loan Agreement. Each Lender also acknowledges that it will, independently and
without reliance upon Agent or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in taking or not
taking any action under this Loan Agreement, the other Loan Documents and any other instrument or
document furnished pursuant thereto or in connection with the Obligations.




          SECTION 8.5.    Loan.




          (a) Amendments and Modifications; Exercise of Rights and Remedies. Subject to
Section 8.5(b) hereof, Agent reserves the right, in its discretion, in each instance
without prior notice to Lenders, (i) to exercise or refrain from exercising any powers or rights
which Agent or Lenders may have under or with respect to the Note, this Loan Agreement or any other
Loan Document, (ii) to enforce or forbear from enforcing the Loan Documents, (iii) to grant or
withhold consents, approvals or waivers and to make any other determinations in connection with the
Loan and the Loan Documents, (iv) to amend or modify the Loan Documents, (v) to acquire additional
security or release any security given with respect to the Loan, (vi) to collect all sums due under
the Loan Documents, (vii) to declare the Loan due and payable when permitted to do so pursuant to
the terms of the Loan Documents, (viii) to enforce



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the Loan Documents, (ix) to take possession of, foreclose or accept a deed and/or assignment
of the Collateral or any portion thereof in lieu of foreclosure, (x) to sell, dispose of or
otherwise deal with the ownership and operation of the Collateral, (xi) to bid at foreclosure of
the Mortgage such amount as Agent shall determine in its discretion, and (xii) to exercise or
determine not to exercise all powers which are incidental to any of the foregoing.




          (b) Restrictions of Power of Agent. Notwithstanding anything to the contrary contained in
Section 8.5(a) hereof or elsewhere in this Loan Agreement, Agent shall not (i) without the
prior written consent of all Lenders, agree to any amendment to or waiver of any of the terms or
conditions of the Note, this Loan Agreement or any other Loan Document which would (v) extend the
time for any payments of interest or principal, including the Maturity Date, (w) reduce the rate of
interest payable pursuant to this Loan Agreement, (x) increase the maximum principal amount of the
Loan (provided that protective advances shall not be deemed to be prohibited or limited by this
restriction), (y) release any material portion of the Collateral other than in accordance with the
Loan Documents in all material respects or (z) release Borrower, Guarantor or any other guarantor
of the Loan from any of their material obligations with respect to the Loan in any material respect
or (ii) without the consent of the Requisite Lenders during any period in which the Pro Rata Share
of Agent and/or any Affiliate of Agent as a Lender for the Loan is less than a ten percent (10%)
interest in the aggregate, either (v) agree to any material amendment to or material waiver of any
of the terms or conditions of the Note, this Loan Agreement or any other Loan Documents,
(w) declare the Loan due and payable, (x) take possession of, foreclose or accept a deed and/or
assignment of the Collateral or any portion thereof in lieu of foreclosure, (y) sell or dispose of
the Collateral or (z) bid at any foreclosure of the Mortgage. In the event that Agent requests a
Lender’s consent pursuant to this Section 8.5(b) and Agent does not receive the Lender’s
written response within ten (10) Business Days of the request therefor, such Lender shall be deemed
to have consented to the action proposed in such request.




          (c) Deemed Consent. In the event that Agent requests a Lender’s consent pursuant to
Section 8.5(b) hereof and Agent does not receive the Lender’s written response within ten
(10) Business Days of the request therefor, or such shorter period that Agent in the exercise of
its reasonable business judgment determines is necessary under the circumstances, such Lender shall
be deemed to have consented to the action or determination proposed in such request. All such
requests for consent from Agent to Lenders shall (i) be given in the form of a written notice to
each Lender, (ii) be accompanied by a description of the matter or item as to which such consent is
requested, or shall advise each Lender where such matter or item may be inspected, or shall
otherwise describe the matter or issue to be resolved, and (iii) shall include Agent’s proposal in
respect thereof.




          (d) Instructions from Lenders. Agent may at any time request instructions from Lenders with
respect to any actions, consents, waivers or approvals which, by the terms of any of the Loan
Documents, Agent is permitted or required to take or to grant, and Agent shall be absolutely
entitled to refrain from taking any action or to withhold any approval, consent or waiver and shall
not be under any liability whatsoever to any Person for refraining from any action or withholding
any approval, consent or waiver under any of the Loan Documents until Agent shall have received
such instructions.




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          SECTION 8.6.    Equitable Adjustments. If a Lender shall obtain any payment (whether voluntary,
involuntary or otherwise) on account of such Lender’s interest in the Loan in excess of such
Lender’s Pro Rata Share to which such Lender is entitled (other than payments on account of
Excluded Sums payable to such Lender) or payment on account of Excluded Sums payable to another
Person, such Lender shall forthwith pay over to Agent an amount sufficient to enable Agent to cause
such excess payment to be shared ratably with the other Lenders or, in the case of Excluded Sums
payable to another Person, such Excluded Sums.




          SECTION 8.7.    Other Transactions. Agent and each Lender and their respective Affiliates and
subsidiaries may accept deposits from, lend money to, act as trustee under indentures of, and
generally engage in any kind of business with, Borrower, any Affiliate of Borrower, any
subsidiaries of Borrower or its Affiliates and any Person who may do business with or own interests
in or securities of Borrower or any such Affiliate or subsidiary without any duty to account
therefor to each other. In the event that Agent or a Lender shall enter into an Interest Rate
Protection Agreement, Agent or such Lender, as the case may be, shall be free to exercise its
rights and remedies pursuant to the terms of the applicable Interest Rate Protection Agreement as
if Agent or Lender, as the case may be, was not Agent or a Lender hereunder.




          SECTION 8.8.    Obligations Absolute. Each Lender acknowledges and agrees that its obligations
hereunder are absolute and unconditional and shall not be affected by any circumstance whatsoever,
including any breach by Agent or a Lender of their obligations under this Loan Agreement or any
other Loan Document, any lack of validity or enforceability of the Note, this Loan Agreement or any
other Loan Document, the occurrence and continuance of any Default or Event of Default or the
failure to satisfy any term or condition of the Note, this Loan Agreement or any other Loan
Document. Without limiting the generality of the immediately preceding sentence, each Lender
agrees that any payment required to be made by it shall be made without any offset, abatement,
withholding or reduction whatsoever and a breach by Agent or any Lender of any of their obligations
pursuant to this Loan Agreement or any other Loan Document shall not limit or otherwise affect a
Lender’s obligations pursuant to this Loan Agreement.




SECTION 8.9.    Indemnification.




          (a) Generally. Lenders hereby agree to indemnify Agent (to the extent Agent is not otherwise
reimbursed hereunder or under the Loan Documents by Borrower), on demand, in proportion to their
Pro Rata Shares, for and against any and all claims, demands, liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements (including
reasonable fees and disbursements of counsel) of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against Agent in any way relating to or arising hereunder or out of
any of the Loan Documents, any action taken or omitted by Agent hereunder or thereunder, the
Premises or the Collateral, including any matter required to be indemnified by Borrower pursuant to
Section 9.1 hereof; provided, however, that Lenders shall not be liable for
(a) any of such claims, demands, liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements to the extent resulting from Agent’s willful
misconduct or gross negligence, or (b) any of such claims, demands, liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements which arise
pursuant to any Lender Interest Rate Protection Agreement to which



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Agent or its Affiliate is party. A certificate of Agent as to the amount for which Lenders
are required to reimburse Agent pursuant to this Section 8.9 shall be prima facie evidence
as to such amount. Lenders’ obligations under this Section 8.9 shall survive the
termination of this Loan Agreement and the Loan Documents. Without limiting the foregoing, in the
event Agent elects to make a protective advance, each Lender shall fund its Pro Rata Share thereof.
If Agent advances its own funds for any protective advance, each Lender shall upon Agent’s demand
reimburse Agent for same in the amount of its Pro Rata Share thereof.




          (b) Indemnification Regarding Certain Actions. Unless indemnified to Agent’s satisfaction
against any claims, demands, liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements (including reasonable fees and disbursements of
counsel), Agent may not be compelled to do any act under this Loan Agreement or any other Loan
Document or to take any action toward the execution or enforcement of the powers hereby or thereby
created or to prosecute or defend any suit with respect to this Loan Agreement or any other Loan
Document. In no event, however, shall Agent be required to take any action that Agent determines
would be in violation of any applicable regulatory requirements, or could incur for Agent criminal
or onerous civil liability.




          SECTION 8.10.    Taxes. All taxes due and payable on any payments to be made to any Lender with
respect to the Obligations or under the Loan Documents shall be such Lender’s sole responsibility.
All payments payable by Agent to any Lender hereunder or otherwise with respect to the Obligations
shall be made without deduction for any taxes, charges, levies or withholdings, except to the
extent, if any, that such amounts are required to be withheld by Agent under applicable law or the
terms of the Loan Documents or this Loan Agreement. If any Lender is organized or is existing
under the laws of a jurisdiction outside the United States, such Lender shall provide to Agent upon
the execution of this Loan Agreement, or execution of any Assignment and Acceptance pursuant to
which it becomes a Lender hereunder, and from time to time thereafter, at least two (2) duplicate
completed and signed copies of any form(s) that may be required by the United States Internal
Revenue Service in order to certify such Lender’s exemption from United States withholding taxes
with respect to payments to be made to such Lender with respect to the Obligations or under the
Loan Documents or such other documents as are necessary to indicate that all such payments are
exempt from or subject to such taxes at a rate reduced by an applicable tax treaty.




          SECTION 8.11.    Return of Payments. If Agent has received or applied any payment with respect to
the Loan and has paid to any Lender any portion of such payment, and thereafter such payment or
application is rescinded or must otherwise be returned or paid over by Agent, whether required
pursuant to any bankruptcy or insolvency law, the Loan Documents, or otherwise, such Lender shall,
at Agent’s request, promptly return its share of such payment or application to Agent. In
addition, such Lender shall simultaneously remit its Pro Rata Share of any interest or other
amounts required to be paid by Agent with respect to such payment or application. If any Lender
fails to remit such payment to Agent prior to 10:00 a.m. (New York City time) on the second (2nd)
Business Day following Agent’s request for such funds, the payment owed to Agent shall earn
interest at the Base Rate for each day from the date of Agent’s request until its payment to Agent.




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          SECTION 8.12.    No Partnership. This Loan Agreement, the Assignment and Acceptances and the other
Loan Documents do not create a partnership or joint venture among Agent and/or Lenders.




          SECTION 8.13.    Resignation and Removal of Agent; Successor Agent.




          (a) Resignation. Agent may resign, without the consent of Borrower or any Lender, from the
performance of all its functions and duties hereunder at any time by giving at least fifteen (15)
Business Days’ prior written notice to Borrower and Lenders, unless applicable law requires a
shorter notice period or that there be no notice period, in which instance such applicable law
shall control. Such resignation shall take effect upon the acceptance by a successor Agent of
appointment pursuant to Section 8.13(c) or, if applicable, the appointment by Agent of a
successor Agent pursuant to Section 8.13(d) hereof.




          (b) Removal of Agent. In the event of the occurrence of any material gross negligence or
willful misconduct of Agent, if all of the Lenders (other than a Lender that is then acting as
Agent) agree, then Agent may be removed as the agent; provided, however, that no
such removal of Agent shall in any way affect the rights of Agent in its individual capacity as a
Lender. Such removal shall take effect upon the acceptance by a successor Agent of appointment
pursuant to Section 8.13(c) hereof.




          (c) Appointment of Successor Agent by Requisite Lenders. Upon any resignation of Agent, the
Requisite Lenders (including in the determination of the Requisite Lenders, the Pro Rata Shares of
such Lender that is also the resigning Agent) shall appoint a successor Agent. Upon any removal of
Agent, the Requisite Lenders (excluding in the determination of the Requisite Lenders, the Pro Rata
Shares of such Lender that is also the removed Agent shall appoint a successor Agent.




          (d) Appointment by Resigning Agent. If, upon the resignation of Agent, a successor Agent
shall not have been appointed within the fifteen (15) Business Days or shorter period provided in
Section 8.13(a) hereof, the resigning Agent shall then appoint a successor Agent, which
successor shall serve as Agent until such time, if any, as the Requisite Lenders appoint a
successor Agent as provided above.




          (e) Rights of the Successor and Prior Agent. Upon the acceptance of any appointment as Agent
hereunder by a successor Agent, or, if applicable, the appointment of a successor Agent by Agent
pursuant to Section 8.13(d) hereof, such successor Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the resigned or removed Agent
arising from and after the date of such acceptance and appointment, and the resigned or removed
Agent shall be discharged from the duties and obligations of Agent arising from and after such
date. After the resignation or removal of Agent as provided herein, the provisions of this Loan
Agreement shall inure to its benefit as to any actions taken or omitted to be taken by it while it
was Agent under this Loan Agreement.




          SECTION 8.14.    Defaults by any Lender.




          (a) Consequences of Default. If for any reason any Lender shall be in default of any of its
obligations pursuant to this Loan Agreement or any other Loan Document (a




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“Defaulting Lender”), then, in addition to the rights and remedies that may be
available to Agent and any other Lender under this Loan Agreement, at law and in equity, such
Defaulting Lender’s right to participate as a Lender in decisions under this Loan Agreement,
including any rights to approve or direct any determination, action or inaction of Agent where the
approval or direction of Lenders is required or permitted hereby, and such Defaulting Lender’s
right to assign, transfer, sell all or any portion of its rights in and to the Loan or a
participation therein pursuant to Article VII hereof, shall be suspended during the
pendency of such failure or refusal.




          (b) Remedies. If for any reason the Defaulting Lender fails to make timely payment of any
amount required to be paid by such Defaulting Lender to or for the benefit of Agent or any other
Lender hereunder, then, in addition to other rights and remedies which Agent or such other Lender
may have hereunder or otherwise, Agent or any Lender shall be entitled, but not obligated (i) to
advance funds on behalf of any Defaulting Lender, (ii) to the extent not paid by Borrower, to
collect interest from the Defaulting Lender at the Base Rate until the date on which the payment is
made, (iii) to withhold or set off or in the case of a Lender, to cause Agent to withhold or
setoff, and to apply to the payment of the defaulted amount and any related interest, any amounts
to be paid to the Defaulting Lender under this Loan Agreement, (iv) to bring an action or suit
against the Defaulting Lender in a court of competent jurisdiction to recover the defaulted amount
and any related interest and (v) to purchase the Defaulting Lender’s interest in the Loan in the
manner set forth in this Section 8.14. Upon the Defaulting Lender’s failure to make
payments as set forth herein and so long as such failure remains uncured (and it is agreed an
advance of funds by any other Lender pursuant to clause (i) above shall not be considered a
cure of the Defaulting Lender’s default), the Defaulting Lender shall not be entitled to receive
its share of any payments made by Borrower (or amounts owed by Borrower) after such date pursuant
to the Loan Documents. If Agent receives any payment with respect to the Obligations from Borrower
as to which a Defaulting Lender would otherwise have been entitled, then such Defaulting Lender’s
share of such payment shall be credited toward the amount owed hereunder by such Defaulting Lender
on a dollar for dollar basis.




          (c) Purchase of Defaulting Lender’s Interest After Default. In the event of a default by a
Lender as referred to in Section 8.14(a) hereof, each Lender which is not a Defaulting
Lender shall have the right, but not the obligation, in its sole discretion, to acquire such
Defaulting Lender’s interest in the Loan. If more than one Lender exercises such right, each such
Lender which is not a Defaulting Lender shall have the right to acquire (in accordance with such
acquiring Lender’s Pro Rata Share or upon agreement of the Lenders that desire to so purchase the
Defaulting Lender’s interest, any other proportion) the Defaulting Lender’s interest in the Loan.
Such right to purchase shall be exercised by written notice from the applicable Lender(s) electing
to exercise such right to the Defaulting Lender (an “Exercise Notice”), copies of which
shall also be sent concurrently to each other Lender. The Exercise Notice shall specify (i) the
purchase price for the interest of the Defaulting Lender, determined in accordance with
Section 8.15 hereof and (ii) the date on which such purchase is to occur, which shall be
any Business Day which is not less than fifteen (15) days after the date on which the Exercise
Notice is given, provided that if such Defaulting Lender shall have cured its default in full
(including with the payment of any interest and other amounts due in connection therewith) to the
satisfaction of Agent within said fifteen (15) day period, then the Exercise Notice shall be of no
further effect and the non-defaulting Lender(s) shall no longer have a right to purchase such
Defaulting Lender’s interest. Upon any such purchase of a Defaulting Lender’s interest and as of



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the date of such purchase (the “Purchase Date”), the Defaulting Lender’s interest in
the Loan, and its rights hereunder as a Lender arising from and after the Purchase Date (but not
its rights and liabilities with respect thereto or under this Loan Agreement or the other Loan
Documents for obligations, indemnities and other matters arising or matters occurring before the
Purchase Date) shall terminate on the Purchase Date, and the Defaulting Lender shall promptly
execute all documents reasonably requested to surrender and transfer such interest. Without in any
manner limiting the remedies of Agent or any other Lender, the obligation of a Defaulting Lender to
sell and assign its interest in the Loan under this Section 8.14 shall be specifically
enforceable by Agent and/or any other Lender by an action brought in any court of competent
jurisdiction for such purpose, it being acknowledged and agreed that, in light of the disruption in
the administration of the Loan and the other terms of the Loan Documents that a Defaulting Lender
may cause, damages and other remedies at law are not adequate.




          SECTION 8.15.    Purchase Price; Payment for Defaulting Lender’s Pro Rata Share. The purchase
price for the interest of a Defaulting Lender in the Loan (the “Purchase Price”) shall be
equal to the sum of all of the Defaulting Lender’s advances under the Loan Documents outstanding as
of the Purchase Date, less the costs and expenses incurred by Agent and any non-defaulting Lender
directly as a result of the Defaulting Lender’s default hereunder, including interest accrued on
such unpaid amounts (at the Base Rate), court costs and including reasonable attorneys’ fees and
disbursements, and fees for accountants and other similar advisors (provided that such costs and
expenses are paid by the Lenders acquiring the interest of such Defaulting Lender to Agent and the
Lenders incurring same).




ARTICLE IX




GENERAL CONDITIONS




          SECTION 9.1.    Indemnity.




          (a) Borrower hereby indemnifies and agrees to defend, protect and hold harmless Agent and
Lenders and their respective affiliates, participants, directors, officers, agents and employees
(each, an “Indemnified Party”) from and against any and all losses, liabilities,
obligations, charges, claims, damages, penalties, causes of action, costs and expenses (including
attorneys’ fees and disbursements) of any kind or nature (except to the extent of any claim arising
solely from the gross negligence or willful misconduct of such Indemnified Party and any claim
arising among, by or between Agent and Lenders against each other or any of them), suffered or
incurred by an Indemnified Party in connection with this Loan Agreement, any of the other Loan
Documents, the consummation of the transactions contemplated herein or therein or the use,
operation or occupancy of the Premises or any Mortgaged Property, including the following:





	 	(i)	 	any accident, injury to or death of Persons or
loss of or damage to property occurring on or about the Premises or any
part thereof, or the adjoining sidewalks, curbs, vaults and vault
space, if any, and streets and ways;




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	 	(ii)	 	any design, construction, operation, use,
nonuse or condition of the Premises or any part thereof, or the
adjoining sidewalks, curbs, vaults and vault space, if any, and streets
and ways, including claims or penalties arising from violation of any
Legal Requirement or Insurance Requirement, as well as any claim based
on any patent or latent defect, whether or not discoverable by Agent or
any Lender, any claim as to which the insurance is inadequate;
	 
	 	(iii)	 	any performance of or failure to perform any
labor or services or furnishing of or failure to furnish any materials
or other property in respect of the Premises or any part thereof;
	 
	 	(iv)	 	any negligence or tortious act or omission on
the part of Borrower or any of its agents, contractors, servants,
employees, Lessees, lessees, sublessees, licensees, guests or invitees;
	 
	 	(v)	 	any claim or liability arising pursuant to any
Lease, any Premises Document, any Permitted Encumbrance, the Management
Agreement, the Franchise Agreement or any other agreement to which
Borrower is a party or by which the Mortgaged Property or any part
thereof is bound, including any and all amounts payable to Property
Manager or any other Person as a result of any termination of the
Management Agreement or any such other agreement, including any
termination by Agent in connection with the exercise of its rights and
remedies pursuant to this Loan Agreement or the other Loan Documents;
	 
	 	(vi)	 	any other relationship that has arisen or may
arise between or among Agent, Lenders, Borrower, Guarantor, any third
party with respect to the Premises or the Mortgaged Property or any of
the foregoing, as a result of the execution and delivery of the Note,
this Loan Agreement or the other Loan Documents, or any other action
contemplated hereby, thereby or by any other document executed in
connection with the Loan;
	 
	 	(vii)	 	any claim, action or other proceeding brought
by or on behalf of any Person against Agent or any Lender as the holder
of, or by reason of its interest in, any sum deposited or paid
hereunder or in connection herewith, any insurance proceeds, any
condemnation awards or other amounts applied to the Obligations of
Borrower; and
	 
	 	(viii)	 	any circumstance resulting in the impairment of the Liens of the
Mortgage or the other Security Documents.




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          (b) If any action or proceeding shall be commenced or taken (including an action to foreclose
the Mortgage, collect the Obligations or enforce Agent’s rights under this Loan Agreement, the Note
or the other Loan Documents) by Agent or any other Person, in which action or proceeding Agent or
any Lender is involved or is made a party by reason of the execution and/or delivery of the Note,
this Loan Agreement, or any other Loan Documents or in which it becomes necessary to enforce,
defend or uphold the lien on the Mortgaged Property pursuant to the Mortgage, this Loan Agreement
or the other Loan Documents or the Agent’s and Lenders’ rights under the Note or any other Loan
Documents, all sums paid by Agent for the expense of any such action or litigation shall be paid by
Borrower to Agent five (5) Business Days after demand. In the event the Mortgaged Property, or any
part thereof, shall be advertised for foreclosure sale and not sold, Borrower shall pay all costs
in connection therewith, including reasonable attorneys’ fees and disbursements and advertising
costs.




          (c) Borrower hereby indemnifies and agrees to defend and hold harmless the Indemnified Parties
from and against any and all liabilities, claims, charges, losses and expenses (including
attorneys’ fees and disbursements) or damages of any kind or nature which may arise as a result of
any claim by any broker, “finder” or advisor with which Borrower or any Affiliate of Borrower has
dealt or is alleged to have dealt, including Broker.




          (d) Borrower will hold Agent and each Lender harmless against any and all liability with
respect to any mortgage/deed recording, transfer or intangible personal property tax or similar
imposition now or hereafter in effect, to the extent that the same may be payable by Agent or any
Lender with respect to this Loan Agreement, any Note or any other Loan Document.




          (e) Within five (5) Business Days of demand by any Indemnified Party, Borrower shall commence
to defend, and shall thereafter diligently pursue defense of, any investigation, action or
proceeding in connection with any claim or liability, or alleged claim or liability, that would, if
determined adversely to such Indemnified Party, be covered by the indemnification provisions
contained in this Section 9.1, such defense to be at the sole cost and expense of Borrower
and by counsel selected by Borrower and reasonably approved by such Indemnified Party, which
counsel may, without limiting the rights of an Indemnified Party pursuant to the next succeeding
sentence, also represent Borrower in such investigation, action or proceeding. In the alternative,
an Indemnified Party may elect to conduct its own defense through counsel of its own choosing and
at the expense of Borrower.




          (f) The provisions of this Section 9.1 shall survive the repayment of the Loan.




          SECTION 9.2.    No Waivers. No failure or delay on the part of Agent or Lenders in exercising any
right, power or remedy hereunder or under or in connection with this Loan Agreement or the other
Loan Documents or to insist upon the strict performance of any term of this Loan Agreement or any
other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right, power or remedy preclude any other or further exercise thereof or the exercise of
any other right, power or remedy under or in connection with this Loan Agreement or any other Loan
Document.




          SECTION 9.3.    Intentionally Omitted.




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          SECTION 9.4.    Agent and Lenders Sole Beneficiaries. No Person other than Agent, Lenders and
Borrower shall have standing to require satisfaction of any terms, provisions or covenants hereof.
No Person other than Agent, Lenders and Borrower shall be deemed to be beneficiary of the terms,
provisions, covenants and other conditions of this Loan Agreement and the other Loan Documents, any
or all of which may be freely waived, in whole or in part, by Agent at any time if Agent deems it
advisable or desirable to do so.




          SECTION 9.5.    Entire Agreement. This Loan Agreement and the other Loan Documents embody the
entire agreement and understanding between Borrower, Agent and/or Lenders with respect to the Loan
and supersede and cancel all prior loan applications, expressions of interest, commitments,
agreements and understandings, whether oral or written, relating to the subject matter hereof,
except as specifically agreed in writing to the contrary.




          SECTION 9.6.    Assignment. Borrower may not assign, transfer or otherwise convey this Loan
Agreement or any other Loan Document, in whole or in part, nor all or any portion of the Loan nor
any interest therein.




          SECTION 9.7.    Further Assurances; Filing of Financing Statements. Borrower promptly shall make,
execute or endorse, and acknowledge and deliver or file or cause the same to be done, all such
vouchers, invoices, notices, certifications, instruments, additional agreements, undertakings,
conveyances, deeds of trust, mortgages, transfers, assignments, financing statements or other
assurances, and take all such other action, as Agent may, from time to time, reasonably deem
necessary or proper in connection with this Loan Agreement or any of the other Loan Documents, the
obligations of Borrower hereunder or thereunder, or for better assuring and confirming unto Agent
and Lenders the full benefits and rights granted or purported to be granted by this Loan Agreement
or the other Loan Documents; provided, however, the same do not increase in a
material manner Borrower’s or Guarantor’s respective obligations or decrease in a material manner
such parties’ respective rights under this Loan Agreement or the other Loan Documents. Borrower
hereby agrees that, without notice to or the consent of Borrower, Agent may file with the
appropriate public officials such financing statements or similar documents as are or may become
necessary to perfect and continue the perfection of the security interest granted by any Security
Document.




          SECTION 9.8.    Cumulative Remedies. The remedies in this Loan Agreement and the other Loan
Documents herein are cumulative and not exclusive of any remedies available at law or equity or in
any other agreement, document or instrument.




          SECTION 9.9.    Amendments, Consents, Waivers, Approvals, Etc. Except as set forth in Section
8.1 hereof, no amendment, modification, termination, or waiver of any provision of this Loan
Agreement or the other Loan Documents shall be effective unless in writing and signed by Borrower
and Agent. With respect to any matter for which Agent’s consent or approval is required hereunder
or under the other Loan Documents, no such consent or approval by Agent hereunder shall in any
event be effective unless the same shall be in writing and signed by Agent, and then such waiver or
consent shall be effective only in the



100









 






specific instance and for the specific purpose for which given. Any waiver or consent made by
Agent shall be effective only in the specific instance and for the specific purpose for which
given. No notice to or demand on Borrower in any case shall entitle Borrower to any other or
further notice or demand in similar or other circumstances. No failure or delay of Agent in
exercising any power or right hereunder or to demand payment for any sums due pursuant to this Loan
Agreement or any other Loan Document, shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other further exercise thereof or the exercise of any
other right or power.




          SECTION 9.10.    Notices. Except as may be otherwise expressly provided herein, all notices,
certificates, demands, requests, approvals, consents, waivers and other communications provided for
herein shall be in writing and (a) mailed (registered or certified mail, return receipt requested,
and postage prepaid), (b) hand-delivered, with signed receipt, or (c) sent by nationally-recognized
overnight courier as follows:



If to Borrower, to:

Interstate Atlanta Airport, LLC

c/o Interstate Hotels & Resorts

4501 North Fairfax Drive, Suite 500

Arlington, Virginia 22203

Attention: Executive Vice President and General Counsel



with a copy to:



DeCampo, Diamond & Ash

747 Third Avenue

New York, New York 10017

Attention: William B. Diamond, Esq.



If to Agent, to:



PB Capital Corporation

230 Park Avenue

New York, New York 10169

Attention: Real Estate Portfolio Management



with a copy to:



Kaye Scholer LLP

425 Park Avenue

New York, New York 10022

Attention: Warren J. Bernstein, Esq.




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If to Lenders, to:



PB Capital Corporation

230 Park Avenue

New York, New York 10169

Attention: Real Estate Portfolio Management



with a copy to:



Kaye Scholer LLP

425 Park Avenue

New York, New York 10022

Attention: Warren J. Bernstein, Esq.



or to such other address with respect to any party as such party shall notify the other parties in
writing. All such notices, certificates, demands, requests, approvals, waivers and other
communications given pursuant to this Section 9.10 shall be effective when received (or
delivery is refused) at the address specified as aforesaid.




          SECTION 9.11.    Limitation on Liability. All Obligations shall be recourse to Borrower.
Notwithstanding anything to the contrary contained in this Loan Agreement, the Note, the Mortgage
or the other Loan Documents, no recourse shall be had for the payment of the principal, Interest,
Additional Interest or other amounts owed hereunder or under the Note or the other Loan Documents,
or for any claim based on this Loan Agreement, the Note or any other Loan Document, against
Guarantor (or any Affiliate of Guarantor) or any of its assets (other than from the interest of
Guarantor in Borrower), or against any principal, partner, member, shareholder, officer, director,
agent or employee of Borrower or Guarantor or any Affiliate of Guarantor (other than from the
indirect interest of any such Person in Borrower), it being expressly understood that the sole
remedies of Agent and Lenders with respect to such amounts and claims shall be against Borrower and
the assets of Borrower, including the Mortgaged Property, and other Collateral; provided,
however, that:




          (a) nothing contained in this Loan Agreement (including the provisions of this
Section 9.11), the Note or the other Loan Documents shall constitute a waiver of any of
Borrower’s obligations herein or under the Note or the other Loan Documents, or of any of any
obligations of Guarantor (including, to the extent a direct or indirect owner of Borrower) under
the Loan Documents to which it is a party;




          (b) nothing contained in this Loan Agreement (including the provisions of this
Section 9.11), the Note or the other Loan Documents shall constitute a limitation of
liability of Borrower or any of its assets; and




          (c) nothing contained in this Loan Agreement (including the provisions of this
Section 9.11), the Note or the other Loan Documents shall constitute a limitation of
liability of Guarantor or any of its respective assets with respect to the Recourse Liability
Agreement, the Environmental Indemnity or any other guaranty or indemnity agreement given by it in
connection with the Loan, as applicable.




102









 








          SECTION 9.12.    Waiver of Consequential Damages, Etc. Borrower hereby unconditionally and
irrevocably waives, to the maximum extent not prohibited by applicable law, any rights it may have
to claim or recover against Agent or Lenders in any legal action or proceeding any special,
exemplary, punitive or consequential damages.




          SECTION 9.13.    Binding Effect. This Loan Agreement shall be binding upon and inure to the
benefit of Agent and Lenders and their respective permitted successors and assigns and Borrower and
its permitted successors and assigns.




          SECTION 9.14.    Severability of Provisions. Any provision of this Loan Agreement which is
prohibited or unenforceable in the State of New York or in any other jurisdiction in the United
States shall be, as to the State of New York or such other jurisdiction in the United States,
ineffective to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof or affecting the validity or enforceability of such provisions in any
other jurisdiction.




          SECTION 9.15.    Governing Law and Consent to Jurisdiction. This Loan Agreement shall be governed
by, and construed in accordance with, the substantive laws of the State of New York. Borrower,
Agent and Lenders irrevocably (a) agree that any suit, action or other legal proceeding arising out
of or relating to this Loan Agreement, the Note or the other Loan Documents may be brought in the
Courts of the United States of America located in the Southern District of New York or in a state
court of record in New York County, New York, (b) consent to the jurisdiction of each such court in
any such suit, action or proceeding and (c) waive any objection which it may have to the laying of
venue of any such suit, action or proceeding in any of such courts and any claim that any such
suit, action or proceeding has been brought in an inconvenient forum. Borrower irrevocably
consents to the service of any and all process in any such suit, action or proceeding by service of
copies of such process to Borrower at its address provided in Section 9.10 hereof. Nothing
in this Section 9.15, however, shall affect the right of Agent to serve legal process in
any other manner permitted by law or affect the right of Agent to bring any suit, action or
proceeding against Borrower or its property in the courts of any other jurisdictions.




          SECTION 9.16.    Waiver of Jury Trial. Borrower, Agent and Lenders each hereby expressly and
unconditionally waives any and every right either party may have to a trial by jury, in any suit,
action or proceeding brought under or with respect to this Loan Agreement, the Note or the other
Loan Documents.




          SECTION 9.17.    No Joint Venture. Borrower is not and shall not be deemed to be a joint venturer,
partner, tenant in common or joint tenant with, or an agent of, Agent or Lenders for any purpose.
Neither Agent nor Lenders shall be deemed to be in privity of contract with third party unless and
until and except to the extent that Agent shall affirmatively act to establish any such privity
pursuant to Article VI hereof, or in the exercise of Agent’s and Lenders’ remedies pursuant
to the Mortgage, the Assignment of Agreements or any other Loan Document.




103









 








          SECTION 9.18.    Determinations and Consents of Agent. Unless expressly provided otherwise in any
particular instance in the applicable Loan Document, any determination, election or judgment made
or any consent or waiver given by Agent pursuant to this Loan Agreement or any other Loan Document
shall be made or given, as the case may be, in Agent’s sole and absolute discretion, whether or not
the applicable provision of this Loan Agreement or such other Loan Document expressly so provides.
In making any such determination, election or judgment or in providing or deciding not to provide
any such consent or waiver, Agent shall be entitled to rely, to the extent Agent so elects, in
whole or in part on the advice of counsel, independent public accountants, engineers, architects
and other experts selected by Agent.




          SECTION 9.19.    Reliance by Agent on Action on Behalf of Borrower. Agent shall be entitled to
rely on any notice, communication or other action taken by any Person purporting to sign as the
officer or other authorized agent, signatory, representative or agent of Borrower or Guarantor
purporting to be taken on Borrower’s or Guarantor’s behalf (or on Guarantor’s behalf on behalf of
Borrower) as being conclusive evidence of Borrower’s or Guarantor’s right to take such action and,
in doing so, bind Borrower or Guarantor, as applicable, to the action taken.




          SECTION 9.20.    Headings, Etc. The headings and captions of various sections of this Loan
Agreement have been inserted for convenience only and are not to be construed as defining,
modifying, limiting or amplifying, in any way, the scope or intent of the provisions hereof.




          SECTION 9.21.    Incorporation by Reference. Borrower agrees that the Note and the other Loan
Documents shall be made subject to all the terms, covenants, conditions, obligations, stipulations
and agreements contained in this Loan Agreement to the same extent and effect as if fully set forth
in and made a part of the Note and the other Loan Documents. In the event of a conflict between
any of the Loan Documents and the provisions of this Loan Agreement, this Loan Agreement shall
control.




          SECTION 9.22.    Counterparts. This Loan Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, and it shall not be necessary in making
proof of this Loan Agreement to produce or account for more than one such counterpart.




          SECTION 9.23.    Attorneys’ Fees. Any provisions of this Loan Agreement or any other Loan Document
that require payment to Agent or Lenders of legal fees or expenses incurred by any of them shall be
construed as including any and all such reasonable fees and expenses incurred in connection with
litigation, mediation, arbitration, other alternative dispute processes, administration proceedings
and bankruptcy proceedings, and any appeals from any of the foregoing.




          SECTION 9.24.    Employer Identification Number, Etc. Borrower acknowledges that in order for
Lenders to comply with the requirements under the Patriot Act, Borrower must provide to Agent
certain information or supporting documentation (collectively “Documentation”) at the time
of execution of this Loan Agreement. Lenders may be required by



104









 






the Patriot Act to verify and record any Documentation provided by Borrower to validate Borrower’s
identity. Documentation that may be requested from Borrower may include, but is not limited to, a
Federal Employer Identification Number (FEIN), a Certificate of Good Standing to validate
Borrower’s corporate, partnership or limited liability company existence, a Certificate of
Incumbency to authenticate the management of Borrower, and other government issued certified
documents to validate Borrower’s authorization to conduct business.




[The remainder of this page is intentionally left blank.]





105









 








          IN WITNESS WHEREOF, the parties hereto have caused this Loan Agreement to be duly executed and
delivered by their respective duly authorized officers as of the day and year first above written.




	 	 	 	 	 
	 	BORROWER:



INTERSTATE ATLANTA AIRPORT, LLC

 	 
	 	By:  	/s/ CARRIE S. MCINTYRE
 	 
	 	Name:  	Carrie S. McIntyre 	 
	 	Title:  	Vice President and Treasurer 	 
	 



[Signatures continue on the following page]














 








	 	 	 	 	 
	 	AGENT:



PB CAPITAL CORPORATION

 	 
	 	By:  	/s/ JONATHAN OH
 	 
	 	Name:  	Jonathan Oh 	 
	 	Title:  	Senior Director 	 
	 
	 	 	 
	 	By:  	                    /s/ DANIEL T. CERULLI
 	 
	 	Name:  	Daniel T. Cerulli 	 
	 	Title:  	Senior Director 	 
	 
	 	LENDERS:



PB CAPITAL CORPORATION

 	 
	 	By:  	/s/ JONATHAN OH
 	 
	 	Name:  	Jonathan Oh 	 
	 	Title:  	Senior Director 	 
	 
	 	 	 
	 	By:  	                    /s/ DANIEL T. CERULLI
 	 
	 	Name:  	Daniel T. Cerulli 	 
	 	Title:  	Senior Director