ex10_34.htm


     

    
      

      

    

    
 

    EXHIBIT
10.34

    


    LOAN
AGREEMENT

    


    


    This
LOAN AGREEMENT (further:
"Agreement") is made and entered into by and between

    


    1. SONESTA
LICENSING CORPORATION, established and holding offices in the USA,
further to be called "Lender", represented by its managing-director a/o
president a/o vice-president,

    


    and

    


    2.    The
limited liability company ST. MAARTEN RESORT HOTEL & CASINO N.V.,
established and holding offices on St. Maarten, further to be called “Borrower”
and represented by its managing-director.

    


    WHEREAS:

    


    Lender
and St. Maarten Resort Hotel & Casino N.V. have on or about this date
entered into a “First Amendment” to the existing License Agreement between them,
dated October 18, 2006, pursuant to which First Amendment the existing License
Agreement regarding Sonesta Great Bay Resort & Casino (“Sonesta Great Bay”)
will be extended for a term of 10 years, unless one of the parties exercises its
right of earlier termination pursuant to said First Amendment; and

    


    In
connection with the abovementioned First Amendment, Lender agrees to provide a
loan to Borrower under the following conditions and stipulations:

    


    IT IS MUTUALLY AGREED UPON
AS FOLLOWS:

    


    WITNESSETH:

    


    Article
1                      Loan
amount/Purpose

    


    Upon
execution of documentation deemed satisfactory by both parties, Lender agrees to
lend to Borrower the amount of US$ 300,000 (Three Hundred Thousand US Dollars),
further called “the Loan”.  The Loan shall be used solely for the
purpose of upgrading and improving Sonesta Great Bay (the “Hotel”) which
upgrades and improvements are specified in “Schedule A”, which is incorporated
herein by reference.  The Loan shall be funded by Lender to Borrower
in accordance with the schedule attached to this Agreement as “Schedule B”,
which is incorporated herein by reference.


    
      
         


      

      
        LOAN
AGREEMENT - PAGE 1

        
          

        

      

      
         


      

    


    


    Article
2                      Interest

    


    Sums
advanced under the Loan shall accrue interest from the dated advanced. The
interest rate applicable to the Loan shall be the one-year LIBOR rate (as
measured on January 1 of each License Year, as defined in the License
Agreement), plus:

    


    
      	
              ·  

            	
              1.5%
      if the annual “Gross Guestroom Revenue” (as defined in the License
      Agreement) for the Hotel is either less than the Gross Guestroom Revenue
      for the Hotel for the prior License Year, or is equal to or exceeds the
      Gross Guestroom Revenue for the Hotel for the prior License Year, and such
      excess is not more than 3.5%

            


    

     

    
      	
              ·  

            	
              1%
      if the annual Gross Guestroom Revenue for the Hotel is equal to or exceeds
      the Gross Guestroom Revenue for the Hotel for the prior License Year, and
      such excess is more than 3.5%, but not more than
  7.5%

            


    

     

    
      	
              ·  

            	
              Zero
      (0) if the annual Gross Guestroom Revenue for the Hotel exceeds the Gross
      Guestroom Revenue for the Hotel for the prior License Year by more than
      7.5%

            


    

     

    


    Article
3                      Repayment

    


    Borrower
shall repay the Loan to Lender as follows:  Interest payments shall be
made quarterly on the last day of each calendar quarter and the Interest Rate
shall be based on LIBOR.  When Borrower’s annual financial statements
are prepared and provided to Lender, pursuant to subsection 6.4.b., the parties
shall agree on the applicable interest rate based on Article 2, above, and any
interest owed to Lender in addition to LIBOR previously paid shall be paid by
Borrower on or before the 90th day
after the Borrower’s fiscal year end.

    


    Principal
payments in the amount of U.S. $30,000 shall be made on or before March 31 of
each calendar year, with the first payment being due on or before March 31,
2011.

    


    The Loan
shall mature on the earlier of December 31, 2019, or the termination of the
License Agreement.

    


    


    Article
4                      Capital
Expenditures

    


    Borrower
represents and warrants to Lender that “Schedule C” attached hereto accurately
reflects the amounts spent on capital additions and replacements to Sonesta
Great Bay during the period 2005 through year to date 2009 (exclusive of
revenues and capital additions and replacements regarding the
casino).


    
      
         


      

      
        LOAN
AGREEMENT - PAGE 2

        
          

        

      

      
         


      

    


    


    


    Article
5                      Warranties

    


    As an
inducement to Lender to provide the Loan, Borrower hereby warrants and
represents the following:

    


    
      	
              5.1.

            	
              Borrower
      is a limited liability company, duly organized, validly existing and in
      good standing under the laws of the Netherlands Antilles and it has all
      requisite power and authority to execute and deliver this
      Agreement.

            


    

    


    
      	
               
      

            	
              5.2

            	
              Other
      than the consent of the Central Bank of the Netherlands Antilles (“CBNA”),
      no consent of any person and no consent, license, approval or
      authorization of or registration or declaration with any governmental
      body, authority, bureau or agency is required in connection with the
      execution and delivery of this Agreement.  Borrower shall obtain
      the written consent of the CBNA and provide a copy of such consent to
      Lender prior to any funding of the
Loan.

            


    

    


    
      	
               
      

            	
              5.3.

            	
              Neither
      the execution and delivery of this Agreement, the consummation of the
      transactions contemplated therein, nor compliance by Borrower with this
      Agreement will conflict with or result in a breach of any of the terms,
      conditions or provisions of any law, regulations, order, writ, injunction
      or decree of any court or governmental
  instrumentality.

            


    

    


    
      	
               
      

            	
              5.4.

            	
              There
      are no actions, suits or proceedings pending, or to the knowledge of
      Borrower threatened, against or affecting Borrower, or involving the
      validity or enforceability of this Agreement, and there are no actions,
      suits or proceedings pending or, to the knowledge of Borrower, threatened
      against or affecting Borrower which could have a material adverse affect
      on the ability of each or any of such parties to perform their respective
      obligations under this Agreement; and further, no event has occurred which
      will violate, be in conflict with, result in the breach of or constitute
      (with due notice or lapse of time, or both) a default under, any
      applicable law or regulation or result in the creation or imposition of
      any lien, charge or encumbrance of any nature whatsoever upon any of
      Borrower’s property other than the lien and security interest created by
      this Agreement.

            


    

    



    
      
         


      

      
        LOAN
AGREEMENT - PAGE 3

        
          

        

      

      
         


      

    


    
      	
               
      

            	
              5.5.

            	
              Borrower
      is solvent, is not bankrupt and has no outstanding liens, suits,
      garnishments, bankruptcies or court actions that could render Borrower
      insolvent or bankrupt.  There has not been filed by or against
      Borrower a petition in bankruptcy, reorganization, liquidation or
      dissolution. All reports, statements and other data or applications for
      credit supplied to Lender by or on behalf of Borrower prior to or
      subsequent to the execution of this Agreement are true and correct in all
      material respects and do not omit to state any fact or circumstance
      necessary to make the statements contained therein not
      misleading.  Any and all financial statements and applications
      for credit have been prepared in accordance with generally accepted
      accounting principles consistently applied, and fully and accurately
      present the financial condition of the subject thereof as of the date
      thereof and no material adverse change has occurred in the financial
      condition reflected therein since the respective dates
      thereof.

            


    

    


    
      	
               
      

            	
              5.6.

            	
              Borrower
      is not in default with respect to any order, writ, injunction, decree or
      demand of any court or any Government Authority, or in the payment of any
      indebtedness for borrowed money or under the terms or provisions of any
      agreement or instrument evidencing or securing any such
      indebtedness.

            


    

    


    
      	
               
      

            	
              5.7.

            	
              Borrower
      has filed all tax reports and returns required by any law or regulation to
      be filed by it, including, without limitation, any and all payroll taxes,
      and has either duly paid all taxes, duties and charges indicated due on
      the basis of such returns and reports, or made adequate provision for the
      payment thereof, and the assessment of any material amount of additional
      taxes in excess of those paid and reported is not reasonably
      expected.

            


    

    


    Article
6                        Access
to information

    


    
      	
              6.1.

            	
              Borrower
      shall maintain its books and records in accordance with generally accepted
      accounting principles, applied on a consistent basis, and shall permit
      Lender to visit its hotel properties and installations to examine, audit
      and make and take away copies or reproductions of Borrower’s books and
      records, at all reasonable times. Further, Borrower shall furnish Lender
      with such additional information and statements, lists of assets and
      liabilities, tax returns, and other reports with respect to Borrower’s
      financial condition and business operations as Lender may request from
      time to time.

            


    

    


    
      	
              6.2.

            	
              Lender
      may (but shall not be obligated to) commence, appear in or defend any
      action or proceeding purporting to affect the loan or the respective
      rights and obligations of Lender and Borrower pursuant to this
      Agreement.  Lender may (but shall not be obligated to) pay all
      necessary expenses, including reasonable attorneys' fees and expenses,
      incurred in connection with such proceedings or actions, which Borrower
      agrees to repay to Lender upon
demand.

            


    


    
      
         


      

      
        LOAN
AGREEMENT - PAGE 4

        
          

        

      

      
         


      

    


    
      	
              6.3.

            	
              Borrower
      shall pay and discharge when due all of its indebtedness and obligations,
      including without limitation, all assessments, taxes, governmental
      charges, levies and liens, of every kind and nature, imposed upon Borrower
      or its hotel properties, income, or profits, prior to the date on which
      penalties would attach, and all lawful claims that, if unpaid, might
      become a lien or charge upon any of Borrower’s hotel properties, income,
      or profits.

            


    

    


    
      	
               
      

            	
              6.4.

            	
              Borrower
      shall provide Lender:

            


    

    


    
      	
               
      

            	
              a.

            	
              As
      soon as available, and in any event within thirty (30) days after the end
      of each calendar quarter, financial statements of Borrower, including, but
      not limited to, a balance sheet and income statement of Borrower as of the
      end of such quarter, all in form and substance and in reasonable detail
      satisfactory to Lender and duly certified by the president or managing
      director of Borrower (i) as being true and correct in all material aspects
      to the best of his or her knowledge and (ii) as having been prepared in
      accordance with generally accepted accounting principles, consistently
      applied;

            


    

    


    
      	
               
      

            	
              b.

            	
              As
      soon as available, and in any event within ninety (90) days after the end
      of the fiscal year of Borrower, financial statements of Borrower,
      including, but not limited to, a balance sheet and income statement of
      Borrower as of the end of the preceding fiscal year, , all in form and
      substance and in reasonable detail satisfactory to Lender and duly
      certified by the president or managing director of Borrower (i) as being
      true and correct in all material aspects to the best of his or her
      knowledge and (ii) as having been prepared in accordance with generally
      accepted accounting principles, consistently applied; said president or
      managing director shall also certify to Lender that all tax returns due as
      of that date have been duly filed and those returns not yet due shall be
      filed in a timely manner.

            


    

    


    
      	
               
      

            	
              c.

            	
              Notice
      of (i) any and all material adverse changes in Borrower’s financial
      conditions, and (ii) all claims made against Borrower that could
      materially affect the financial condition of
  Borrower;

            


    

    


    
      	
               
      

            	
              d.

            	
              Upon
      demand of Lender, evidence of payment of all assessments,
      taxes,

            


    

    
      	
               
      

            	
              charges,
      levies, liens and claims on or against Borrower’s properties, income or
      profits, and authorize the appropriate governmental official to deliver to
      Lender at any time a written statement of any assessments, taxes, charges,
      levies, liens and claims against Borrower’s properties, income or profits;
      and such other information respecting the business, properties or
      condition or the operations, financial or otherwise, of Borrower as Lender
      may from time to time reasonably
request.

            


    

    



    
      
         


      

      
        LOAN
AGREEMENT - PAGE 5

        
          

        

      

      
         


      

    


    
      	
              Article
      7

            	
              Negative
      warranties

            


    

    


    
      	
               
      

            	
              Until
      the Loan and all other obligations and liabilities of Borrower under
      this  Agreement are fully paid and satisfied, Borrower will not,
      without the prior written consent of Lender: (a) make any material change
      in the nature of its hotel business as carried on as of the date hereof;
      (b) liquidate, merge or consolidate with or into any other entity; (c)
      sell, transfer or otherwise dispose of any of its hotel (and/or related)
      assets or properties; (d) create, incur or assume any lien or encumbrance
      on any of its hotel (and/or related) assets or properties, except as
      specifically permitted under this Agreement; (e) change its address,
      location, name, identity or corporate structure, (f) create, incur or
      assume any indebtedness for borrowed money or issue or assume any other
      note, debenture, bond or other evidences of indebtedness, or guarantee any
      such indebtedness or such evidences of indebtedness of others, other than
      (i) borrowings from Lender, (ii) borrowings outstanding on the date hereof
      and disclosed in writing to Lender, and (iii) working capital loans and/or
      loans for capital improvements that (A) do not exceed U.S. $500,000 per
      year, and (B) are repaid in full for at least thirty (30) consecutive days
      each year; or (g) permit the sale or other transfer of any ownership
      interest in Borrower.

            


    

    


    Article
8                      
Indemnification

    


    
      	
               
      

            	
               Borrower
      hereby agrees to indemnify, defend at its sole cost and expense and hold
      Lender and its successors and assigns harmless from and against and to
      reimburse Lender with respect to, any and all claims, demands, actions,
      causes of action, losses, damages, liabilities, costs and expenses
      (including without limitation attorney's fees and court costs) of any and
      every kind of character, known or unknown, fixed or contingent, asserted
      against or incurred by Lender at any time and from time to time by reason
      of or arising out of (i) the breach of any representation or warranty of
      Borrower set forth herein, and/or (ii) the failure of Borrower, in whole
      or in part, to perform any obligation required in this Agreement to be
      performed by Borrower.

            


    

    


    Article
9                      Default
& remedies

    


    
      	
               
      

            	
              9.1

            	
              The
      occurrence of any one or more of the following shall constitute an Event
      of Default hereunder:

            


    

    


    
      	
               
      

            	
              (a)

            	
              A
      failure of Borrower to pay the principal of or interest on the Loan as and
      when the same becomes due and payable in accordance with the terms of this
      Agreement, and such failure shall continue for a period of five (5) days
      after receipt of written notice from Lender specifying such failure;
      provided, however, that Lender shall be obligated to give only one (1)
      such notice during any calendar year and, after the giving of such one
      notice, Lender shall be entitled to exercise its remedies upon any
      subsequent default occurring within such calendar year without any
      requirement of notice.

            


    


    
      
         


      

      
        LOAN
AGREEMENT - PAGE 6

        
          

        

      

      
         


      

    


    


    
      	
               
      

            	
              (b)

            	
              A
      failure of Borrower to perform any of the covenants, obligations or
      agreements contained in this
Agreement.

            


    

    


    
      	
               
      

            	
              (c)

            	
              Any
      substantial damage to or destruction of or disappearance of Sonesta Great
      Bay shall occur so that, in the reasonable opinion of Lender, it cannot be
      restored or rebuilt with available funds to a profitable condition within
      a reasonable period of time (not to exceed 270
  days).

            


    

    


    
      	
               
      

            	
              (d)
      The liquidation, termination, bankruptcy or dissolution of
      Borrower.

            


    

    


    
      	
               
      

            	
              (e)
      A writ or warrant of attachment or any similar petition shall be issued by
      any court or other authority against all or any substantial portion of
      Sonesta Great Bay.

            


    

    


    
      	
               
      

            	
              (f)
      If there shall occur a material adverse change in the assets, liability,
      financial condition or business operation of
  Borrower.

            


    

    


    
      	
               
      

            	
              9.2

            	
              In
      the event of an occurrence of any Event of Default, Lender shall have the
      right, at its option, without notice or demand upon Borrower (except as
      expressly provided for herein or by applicable law) to do the following:
      (a) declare the unpaid balance of the Loan (including all principal
      thereof and all interest then accrued thereon) to be immediately due and
      payable; (b) cease further advances under the Loan; and/or (c) enforce or
      avail itself of any and all remedies provided in this Agreement and under
      applicable laws.

            


    

    


    
      	
               
      

            	
              9.3.

            	
              All
      powers, rights and remedies of Lender set forth in this Agreement shall be
      cumulative and not exclusive of any other power, right or remedy available
      to Lender under this Agreement and the law to enforce the performance or
      observance of the covenants and agreements contained in this
      Agreement.

            


    

    


    


    Article
10                      Miscellaneous

    


    
      	
               
      

            	
              10.1

            	
              Each
      written instrument required by this Agreement to be furnished to Lender
      shall be furnished to Lender in one or more copies as required by Lender;
      and shall in all respects be in form and substance satisfactory to Lender
      and to its legal counsel.

            


    

    


    
      	
              10.2.

            	
              In
      the event any provision of this Agreement is declared or adjudged to be
      unenforceable or unlawful, then such unenforceable or unlawful provision
      shall be excised therefrom, and the remainder of this Agreement so
      affected, together with all rights and remedies granted thereby, shall
      continue and remain in full force and effect as though such unlawful or
      unenforceable provision had never been contained
  therein.

            


    

    



    
      
         


      

      
        LOAN
AGREEMENT - PAGE 7

        
          

        

      

      
         


      

    


    
      	
               
      

            	
              10.3

            	
              No
      course of dealing between Lender and Borrower, nor any delay on the part
      of Lender in exercising any rights hereunder nor any failure of Lender at
      any time to enforce any provision of this Agreement shall operate as a
      waiver of any rights of Lender, except to the extent, if any, expressly
      waived in writing by Lender.  Lender shall have the right at any
      and all times, without any prior notice to any person, to enforce strict
      compliance with all of the provisions
hereof.

            


    

    


    
      	
               
      

            	
              10.4

            	
              Any
      notice, request or other communication required or permitted to be given
      based on this Agreement shall be in writing and must be sent via
      registered mail and/or courier to the following
  addresses:

            


    

    


    If to the
Borrower:                 St.
Maarten Resort Hotel & Casino N.V.

    Attn:  Saro
Spadaro

    19 Little Bay Road, PO Box
910

    Philipsburg, St. Maarten

    Netherlands Antilles

    


    If to the
Lender:                     Sonesta
Licensing Company

    c/o Sonesta International Hotels
Corporation

    Attention:  Office of the
Treasurer

    116 Huntington Avenue

    Boston,
Massachusetts  02116

    


    Each of
the parties hereto shall be entitled to specify a different address by giving
written notice to the other party hereto in accordance with this
section.

    


    
      	
               
      

            	
              10.5

            	
              Borrower
      shall pay all costs and expenses (including, without limitation,
      reasonable attorneys' fees) in connection with (i) the preparation of this
      Agreement, and any and all extensions, renewals, amendments, supplements,
      extensions or modifications thereof, (ii) any action required in the
      course of administration of the indebtedness and obligations evidenced by
      this Agreement, and (iii) any action in the enforcement of Lender's rights
      upon the occurrence of an Event of
Default.

            


    

    


    
      	
               
      

            	
              10.6

            	
              This
      Agreement will be governed by the laws of the State of New York, United
      States of America. Any dispute that may arise out of this
      Agreement  shall be fully and finally resolved by arbitration
      under the Commercial Rules of the Arbitration Association.  In
      the event of a dispute, one party shall so inform the other of its
      demand.  Any arbitration shall be administered by the New York,
      New York office of the American Arbitration Association and all
      arbitration hearings and proseachers shall be conducted in New
      York.  Either party shall apply to any court of competent
      jurisdiction for an order confirming the arbitration award; judgment of
      the court shall be entered upon the award unless the award is vacated,
      modified or corrected as provided by law.  The prevailing party
      in any such proceeding shall be entitled to recover its reasonable costs
      and attorney fees from the other
party.

            


    


    
      
         


      

      
        LOAN
AGREEMENT - PAGE 8

        
          

        

      

      
         


      

    


    


    


    
      	
               
      

            	
              10.7

            	
              This
      agreement shall be binding upon the respective parties thereto, their
      successors, heirs, representatives and
assigns.

            


    

    


    
      	
               
      

            	
              10.8

            	
              Time
      is of the essence regarding Borrower’s obligations under this
      Agreement.

            


    

    


    



    
      
         


      

      
        LOAN
AGREEMENT - PAGE 9

        
          

        

      

      
         


      

    


    


    


    


    EXECUTED
& SIGNED as of this 18th day of
December, 2009

    


    


    


    


    LENDER:

    


    SONESTA
LICENSING COMPANY

    For
them,

    


    


    


    


    By:  /s/ Peter J.
Sonnabend                                                                           

    


    


    


    


    BORROWER:

    


    ST.
MAARTEN RESORT HOTEL & CASINO N.V.

    For
them,

    


    


    


    


    


    By:  /s/ Saro
Spadaro                                                                           

    



    
      
         


      

      
        LOAN
AGREEMENT - PAGE 10