First Amendment to Purchase and Sale Agreement, dated September 7, 2012



 Exhibit 10.1 
 FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT 
 THIS FIRST
AMENDMENT TO PURCHASE AND SALE AGREEMENT (this “Amendment”) is entered into as of the 7th day of September, 2012 by and between DIG EH HOTEL LLC, a Delaware limited liability company (“Seller”), SHR ESSEX HOUSE,
LLC, a Delaware limited liability company (“Hotel Purchaser”), and SHR ESSEX HOUSE CONDOMINIUMS, LLC, a Delaware limited liability company (“Condo Purchaser”; together with Hotel Purchaser, the
“Purchaser”). 
 W I T N E S S E T H: 

WHEREAS, Hotel Purchaser and Seller entered into that certain Purchase and Sale Agreement dated August 13, 2012
(“Purchase Agreement”) for the purchase and sale of certain property located in New York, New York, as more particularly described in the Purchase Agreement (the “Property”); 

WHEREAS, Hotel Purchaser assigned certain of its rights under the Purchase Agreement to Condo Purchaser as evidenced by that
certain letter from Hotel Purchaser to Seller dated August 31, 2012; and 
 WHEREAS, Purchaser and Seller desire to
amend the Purchase Agreement pursuant to the terms of this Amendment. 
 NOW THEREFORE, in consideration of the mutual
covenants contained herein and for other good and valuable consideration, Purchaser and Seller agree as follows: 
 1.
Closing. Section 8.1(a) of the Purchase Agreement is hereby deleted in its entirety and replaced with the following: “Closing. The closing shall take place at the office of Morrison & Foerster LLP, 1290 Avenue of the
Americas, New York, New York 10104 at 1:00 P.M. (New York City time) (the “Closing”), on September 14, 2012 (the “Closing Date”). Time shall be of the essence with respect to the parties’ obligations to
consummate the transactions contemplated by this Agreement on the Closing Date.” 
 2. Default Charges. Purchaser
acknowledges that as a result of the postponement of the Closing Date from September 7, 2012 to September 14, 2012 agreed to in this Amendment (the “Postponement”), which was requested by Purchaser, Seller shall be
required to pay certain default interest payments and possibly certain other reasonable processing or servicing fees (collectively, “Default Charges”) to its existing lenders in connection with its current financing of the Property
(“Seller’s Existing Loans”) and that the Seller’s Existing Loans would have been paid off prior to their maturity had the Closing occurred on September 7, 2012 as required by the Purchase Agreement prior to this
Amendment. Purchaser acknowledges and agrees that, based upon Seller’s current knowledge of the Seller’s Existing Loans, the amount of the Default Rate above the Applicable Interest Rate (as such terms are defined in the loan agreements
evidencing Seller’s Existing Loans) is estimated to be $36,899 for each day that the Seller’s Existing Loans have not been timely paid and is estimated to be $258,294 if the Closing occurs on September 14, 2012. Purchaser hereby
agrees to pay Seller the Default Charges upon the earlier to occur of (i) the Closing or (ii) Purchaser’s failure to close on the Closing Date and hereby agrees that if the actual amount of Default Charges exceeds the aforementioned
$258,294 amount, Purchaser shall pay Seller the difference within one (1) day of receipt of written notice 







 
from Seller advising Purchaser of such actual amount of Default Charges. Should the Closing occur after September 7, 2012 but prior to September 14, 2012, or should the existing lenders
with respect to Seller’s Existing Loans waive or reduce the Default Charges, the actual Default Charges payable by Purchaser to Seller at Closing shall be prorated or adjusted at Closing to reflect the amount actually payable by Seller under
the Seller’s Existing Loans. 
 3. Condominium Charges. Purchaser hereby agrees that, notwithstanding anything to the
contrary in Section 8.4(b)(viii) of the Purchase Agreement, if Seller and Purchaser proceed to Closing, Seller shall not be responsible for the $656,025 in capital expenditures for the Essex House Condominium as shown on Exhibit A
attached to this Amendment (the “Condominium Prorations”), and such Condominium Prorations shall be borne by Purchaser. 
 4. Operations. Purchaser acknowledges that operation of the Hotel-Related Units (as such term is defined in the Purchase Agreement) shall be impaired as a result of the proper and necessary
preparations made by Jumeirah Hospitality & Leisure (USA) Inc. (“Jumeirah”) in contemplation of and preparation for Closing on September 7, 2012 and the fact that it was expecting to vacate the Property on that date.
Seller shall continue to use its commercially reasonable efforts to comply with Section 4.3(b) of the Purchase Agreement but shall not be deemed to be in breach of any of its provisions as a result of the postponement of the Closing Date
agreed to in this Amendment and the impairment of the operation of the Hotel-Related Units due to Jumeirah having insufficient staff or resources to maintain normal operations after September 7, 2012. 

5. Hotel Management Costs. Purchaser acknowledges that Jumeirah will incur significant costs and expenses as a result of the
Postponement and the resulting need to redeploy personnel and resources and that Jumeirah will pass those costs onto Seller. Such costs (the “Extraordinary Costs”) shall be over and above the management fees, brand charges,
reimbursable expenses, and other costs incurred in the operation of the Hotel-Related Units unrelated to the Postponement. Purchaser hereby agrees to pay a reasonable portion of such Extraordinary Costs at Closing, and such amount shall be part of
the pro-rations to be done as part of Seller and Purchaser’s preparation of a mutually satisfactory Closing Statement. 
 6.
Successors and Assigns; Extent of Amendment. The terms of this Amendment shall inure to the benefit of, and be binding upon, the respective successors and assigns of the parties hereto. Except as modified herein, the Purchase Agreement shall
remain in full force and effect. 
 7. Capitalized Terms. Capitalized terms used but not defined herein shall have the
meanings ascribed to them in the Purchase Agreement. 
 8. Multiple Counterparts. This Amendment may be executed in
multiple counterparts and via facsimile and/or PDF signature, each of which shall, for all purposes, be deemed an original, but which together shall constitute one and same instrument. 

9. Headings. Descriptive headings are used in this Amendment for convenience only and shall not control, limit, amplify or
otherwise modify or affect the meaning or construction of any provision of this Amendment. 
 [signature pages follows]








 IN WITNESS WHEREOF, the parties have executed this Amendment as of the date set forth
above. 
  

			
	PURCHASER:
	
	SHR ESSEX HOUSE, LLC, a Delaware limited liability company
		
	By:	 	/s/: Jonathan P. Stanner
	Name:	 	Jonathan P. Stanner
	Title:	 	Vice President, Capital Markets & Treasurer
	
	 SHR ESSEX HOUSE CONDOMINIUMS, LLC, a
 Delaware limited liability company

		
	By:	 	/s/: Jonathan P. Stanner
	Name:	 	Jonathan P. Stanner
	Title:	 	Vice President, Capital Markets & Treasurer
	
	 The undersigned is joining in the execution of this
 Amendment for the sole purpose of agreeing to be
 bound to make the payment described in Section
2
 hereof:

	
	STRATEGIC HOTEL FUNDING, LLC
		
	By:	 	/s/: Jonathan P. Stanner
	Name:	 	Jonathan P. Stanner
	Title:	 	Vice President, Capital Markets & Treasurer
	
	SELLER:
	
	DIG EH HOTEL LLC, a Delaware limited liability company
		
	By:	 	/s/: Mark S. Edelstein
	Name:	 	Mark S. Edelstein
	Title:	 	Authorized Signatory


 [signatures continue on following page] 







 ACKNOWLEDGED AND AGREED TO BY: 
 ESCROW AGENT: 
 FIRST AMERICAN TITLE INSURANCE COMPANY 

 

			
	By:	 	/s/: Deanna Wilkie
	Name:	 	Deanna Wilkie
	Title:	 	Escrow Officer

 JOINDER PARTY: 
 LONGWING INCORPORATED, a Delaware corporation 
  

			
	By:	 	/s/: Dinky Puri
	Name:	 	Dinky Puri
	Title:	 	Managing Director

 [end of signatures] 







 EXHIBIT A 

CONDOMINIUM PRORATIONS 
 [attached behind] 







 Essex House hotel 
 Prorations Schedule 
 Unused capex collected from Minority Owners 

Section 8.4(b)(viii) 
  

					
	 Cut-Off Time:
	  	 	09/06/12	  
	 Remaining Minority Capex Collected
	  	$	265,509	  

  

																																	
	 CONDO SHARED 2012 Capital True-Up (Treated as Operating Expense) - JUMEIRAH ESSEX HOUSE

 

	 Project #
	 	 Project Description
	 	2012 Amount	 	 	2012 Budget Pro-
rated 
for 9-
months	 	 	2012	 	 	Minority
Allocation	 	 	Funds Collected From
Minority Owners for
9-months (Jan-Sep,
2012)	 	 	Minority Share of Work
Completed (payments made in
2012)	 	 	Remaining Share of
Minority Interest Collected	 	 	 Status

	 	 	True-Up as of
Sep-2012	 	BUDGET	 	 	BUDGET	 	 	Work Completed	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 JEH-2012-01
	 	Façade Restoration / Roof Replacement	 	$	825,000	  	 	$	618,750	  	 	$	58,890	  	 	 	28.43	% 	 	$	175,911	  	 	$	16,742	  	 	$	159,168	  	 	Façade & Roof Project
	 JEH-2012-08
	 	Boiler #2 Replacement	 	$	350,000	  	 	$	262,500	  	 	$	125,472	  	 	 	26.44	% 	 	$	69,405	  	 	$	33,175	  	 	$	36,230	  	 	Boiler #2 replacement
	 JEH-2012-11
	 	Aruba WiFi (additional Access Points)	 	$	41,072	  	 	$	30,804	  	 	$	0	  	 	 	13.87	% 	 	$	4,273	  	 	$	0	  	 	$	4,273	  	 	Additional access points to improve wireless coverage in the building
	 JEH-2012-40
	 	DVR For Security Camera System	 	$	11,000	  	 	$	8,250	  	 	$	10,219	  	 	 	13.87	% 	 	$	1,144	  	 	$	1,417	  	 	($	273	) 	 	DVR for camera system currently there is no video recording on 32 cameras
	 JEH-2012-41
	 	Fan Coil Replacement - Air Conditioning	 	$	125,000	  	 	$	93,750	  	 	$	10,957	  	 	 	26.44	% 	 	$	24,788	  	 	$	2,897	  	 	$	21,890	  	 	Fan Coil Replacement - Air-conditioning for Corridors
	 JEH-2012-45
	 	HVAC Drier Replacement	 	$	23,000	  	 	$	17,250	  	 	$	0	  	 	 	26.44	% 	 	$	4,561	  	 	$	0	  	 	$	4,561	  	 	Drier for HVAC - This eliminates moisture from the pneumatic control system
	 JEH-2012-50
	 	Electrical Upgrade (Con Ed)	 	$	200,000	  	 	$	150,000	  	 	$	0	  	 	 	26.44	% 	 	$	39,660	  	 	$	0	  	 	$	39,660	  	 	Contingency to install equipment supplied by Con Ed on 23rd & 43rd Fl. Vaults
		 	GRAND TOTAL 2010	 	$	1,575,072	  	 	$	1,181,304	  	 	$	205,538	  	 	 	20.30	% 	 	$	319,741	  	 	$	54,232	  	 	$	265,509	  	 	

  

					
		  	 	9 Months	  
	 Total for 9 Months
	  	$	1,181,304	  
	 Shared by Homeowners
	  	($	319,741	) 
	 Spent to Date
	  	($	205,538	) 
	 Remaining
	  	$	656,025	  

 Total 

Footnotes: 
 Follow-up items: