Exhibit 10.22.2

 

TERM LOAN NOTE

 

Dated as of July 11, 2019 (the “Note Date”)

 

Note Amount: $9,620,000.00

 

FOR VALUE RECEIVED, LF3 PRATTVILLE, LLC, a Delaware limited liability company and LF3 PRATTVILLE TRS, LLC, a Delaware limited liability company (individually and collectively, “Borrower”), promises to pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION, and its successors and assigns (“Lender”), at 1808 Aston Avenue, Suite 250, Carlsbad, California 92008 (or such other place as may be designated by Lender), the principal sum stated above as the Note Amount, with interest thereon, on the dates and at the rates and upon the terms and conditions specified below. This Term Loan Note (this “Note”) is the Note referred to in the Loan Agreement, dated the same date as this Note, between Borrower and Lender (as it may be amended, restated, supplemented, extended or renewed from time to time, the “Loan Agreement”) and is being executed and delivered pursuant thereto (the loan made pursuant to this Note and the Loan Agreement being referred to in this Note as the “Loan”). Capitalized terms used in this Note and not defined in this Note have the meanings given to such terms in the Loan Agreement.

 

1.                            Interest Rate.

 

(a)                        Interest. The outstanding principal balance of this Note shall bear interest (computed on the basis of a 360-day year, actual days elapsed) at a fixed rate of 4.134% per annum. With respect to each Interest Period hereunder, Lender is hereby authorized to note the date and interest rate applicable thereto and any payments made thereon on Lender’s books and records (either manually or by electronic entry) and/or on any schedule attached to this Note, which notations shall be prima facie evidence of the accuracy of the information noted.

 

(b)                        Basis of Computation. The interest rate is an annual rate and will be computed using a 360-  day year and charged for actual days elapsed.

 

(c)                         Definitions. As used herein, the following terms shall have the meanings set forth after each, and any other term defined in this Note shall have the meaning set forth at the place defined:

 

(i)                                “Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in the U.S. are authorized or required by Law to remain closed.

 

(ii)                             “Interest Period” means, with respect to the Loan, the period commencing on the date the Loan is disbursed or converted and ending on the next succeeding Payment Day, and each one (1) month period thereafter ending on the day preceding the next Payment Day; provided, however, no Interest Period shall extend beyond the Maturity Date.

 

(iii)                          “Payment Day” means the first day of each calendar month; provided that, if a Payment Day is not a Business Day, such Payment Day shall be the next succeeding Business Day. The Maturity Date shall also be considered a Payment Day.

 

2.                            Payments.

 

(a)                        When Due; Maturity Date. Interest on the Loan shall be paid in arrears.  Interest accrued on the Loan from the Note Date to the first Payment Day to occur after the Note Date is due and payable on such first Payment Day.  Regular monthly payments (each, a “Monthly Payment”) will commence on the first Payment Day to occur after the Note Date, and will continue on each Payment Day thereafter through the Payment Day occurring on August 1, 2024 (the “Maturity Date”).

 

Obligor Name:  LF3 Prattville, LLC

Obligor No.: 5470431436

 











 

(b)                        Monthly Payment Amounts. Each Monthly Payment will be equal to installments of principal and interest in the amount set forth on Exhibit A with respect to the month in which such payment is due.

 

(c)                         Payment at Maturity. On the Maturity Date, in addition to the required Monthly Payment, Borrower shall also pay the entire remaining unpaid balance of the Loan, if any; all accrued and unpaid interest to the Maturity Date; and any other amounts payable under this Note and the other Loan Documents.

 

3.                            Prepayments.

 

(a)                        Except as may otherwise be expressly provided in this Note and the other Loan Documents, Borrower may not make any prepayment of the Loan except as follows: (i) Borrower must give Lender at least 30 days’ prior written notice of the proposed prepayment; and (ii) the prepayment must be accompanied by payment to Lender of the following: (A) any and all costs, fees, and other expenses, including late fees, then due and payable with respect to the Obligations; (B) interest on the prepaid principal through the prepayment date; and (C) a Prepayment Fee in the amount described below. Any prepayment shall be without prejudice to Borrower’s obligations under any swap agreement (as defined in 11 U.S.C. § 101), which shall remain in full force and effect subject to the terms of such swap agreement (including provisions that may require a reduction, modification or early termination of a swap transaction, in whole or in part, in the event of such prepayment, and may require Borrower to pay any fees or other amounts for such reduction, modification or early termination), and no such fees or amounts shall be deemed a penalty hereunder or otherwise.

 

(b)                        Prepayment Fee. The “Prepayment Fee” will equal (i) 3.0% of the prepaid principal, if made prior to the first anniversary of the Note Date; (ii) 2.0% of the prepaid principal, if made on or after the first anniversary of the Note Date but prior to the second anniversary of the Note Date, and (iii) 1.0% of the prepaid principal, if made on or after the second anniversary of the Note Date; provided that in the event that the Site is sold by Borrower to an independent third party (i.e.: not an Affiliate of the Borrower) in an arms’ length transaction, the Prepayment Fee will be waived.

 

(c)                         Application of Prepayment Amounts. Subject to the provisions of Section 2.8I of the Loan Agreement: (i) amounts paid pursuant to Section 3(a) shall be applied in payment of the amounts specified therein; (ii) all prepaid principal shall be applied to the unpaid principal balance of this Note; provided, however, that any permitted partial prepayment of principal shall be applied to principal in the inverse order of maturity, such that the scheduled Monthly Payment amounts for the Loan otherwise calculated do not change; and (iii) all other payments pursuant to this Note shall be applied first to accrued and unpaid interest on the Note and the balance to reduction of principal on the Note, in the inverse order of maturity.

 

4.                             General Payment Provisions. All payments due pursuant to this Note shall be payable at the place and in the manner provided in Section 2.8 of the Loan Agreement and otherwise in accordance with the provisions of that Section, which Section is incorporated herein by this reference.

 

5.                             Default Interest. From and after the maturity date of this Note, or such earlier date as all principal owing hereunder becomes due and payable by acceleration or otherwise, or upon the occurrence and during the continuance of an Event of Default, then at the option of Lender, in its sole and absolute discretion, the outstanding principal balance of this Note shall bear interest at an increased rate per annum (computed on the basis of a 360-day year, actual days elapsed) equal to 4% above the rate of interest from time to time applicable to this Note (the “Default Rate”).

 

6.                             Late Fees. If Borrower fails to make any payment pursuant to this Note or any other Loan Document on or before the 5th day after the due date for such payment, then Borrower shall pay Lender a late fee equal to 5%  of such past-due payment. Such late fee will be immediately due and payable and is in addition to any other charges, costs, fees, and expenses that Borrower may owe as a result of the late payment, including the imposition of a default rate of interest pursuant to this Note or any other Loan Document.

 

2











 

7.                             Waivers. Borrower and all endorsers, guarantors, and sureties of this Note waive presentment, demand for payment, notice of dishonor, notice of protest, and protest, notice of intent to accelerate, notice of acceleration and all other notices or demands in connection with delivery, acceptance, performance, default or endorsement of this Note.

 

8.                             Lender Computations Final.  Lender’s computations, in accordance with the terms of this Note and the Loan Agreement, of interest rates, Monthly Payment amounts, and final payment amounts, and other amounts due and owing from Borrower to Lender shall be final and conclusive, absent manifest error.

 

9.                             Maximum Rate of Interest. Anything herein to the contrary notwithstanding, the obligations of Borrower hereunder or pursuant to any other Loan Document shall be subject to the limitation that payments of interest shall not be required, for any period for which interest is computed hereunder, to the extent (but only to the extent) that contracting for or receiving such payment would be contrary to the provisions of any Applicable Law limiting the highest rate of interest which may be lawfully contracted for, charged or received by Lender, and in such event Borrower shall pay Lender interest at the highest rate permitted by Applicable Law.

 

10.                      Inconsistencies. If there are any inconsistencies between the terms of this Note and the other Loan Documents, the provisions of this Note shall control.

 

11.                      Applicability of General Provisions. All provisions of the Article in the Loan Agreement titled “General Provisions”, as well as the defined terms in the Loan Agreement, including in the Schedule of Defined Terms attached thereto, apply to this Note, the same as if such provisions were set forth in full in this Note.

 

[SIGNATURE PAGE FOLLOWS]

 

3











 

IN WITNESS WHEREOF, Borrower has executed this Note as of the date stated above.

 

	
 
    	
BORROWER:
    
	
 
    	
 
    
	
 
    	
LF3 PRATTVILLE, LLC,   a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
By:
    	
Lodging Fund REIT III   OP, LP, a Delaware limited partnership, its Sole Member
    
	
 
    	
 
    
	
 
    	
 
    	
By:
    	
Lodging Fund REIT   III, Inc., a Delaware corporation, its General Partner
    
	
 
    	
 
    
	
 
    	
 
    	
 
    	
By:
    	
/s/ Katie Cox
    
	
 
    	
 
    	
 
    	
Name:
    	
Katie Cox
    
	
 
    	
 
    	
 
    	
Title:
    	
Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
LF3 PRATTVILLE TRS, LLC,   a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
By:
    	
Lodging Fund REIT III   TRS, Inc., a Delaware corporation, its Sole Member
    
	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ Katie Cox
    
	
 
    	
 
    	
Name:
    	
Katie Cox
    
	
 
    	
 
    	
Title:
    	
Chief Financial Officer
    


 

Signature Page to Term Loan Note

 











 

EXHIBIT A

 

PAYMENT SCHEDULE

 

(See attached)

 











 

	
Month
    	
 
    	
Payment Due
   Date
    	
 
    	
Principal
   Payments
    	
 
    
	
ODI
    	
 
    	
08/01/19
    	
 
    	
$
    	
0.00
    	
 
    
	
1
    	
 
    	
09/03/19
    	
 
    	
$
    	
0.00
    	
 
    
	
2
    	
 
    	
10/01/19
    	
 
    	
$
    	
0.00
    	
 
    
	
3
    	
 
    	
11/01/19
    	
 
    	
$
    	
0.00
    	
 
    
	
4
    	
 
    	
12/02/19
    	
 
    	
$
    	
0.00
    	
 
    
	
5
    	
 
    	
01/02/20
    	
 
    	
$
    	
0.00
    	
 
    
	
6
    	
 
    	
02/03/20
    	
 
    	
$
    	
0.00
    	
 
    
	
7
    	
 
    	
03/02/20
    	
 
    	
$
    	
0.00
    	
 
    
	
8
    	
 
    	
04/01/20
    	
 
    	
$
    	
0.00
    	
 
    
	
9
    	
 
    	
05/01/20
    	
 
    	
$
    	
0.00
    	
 
    
	
10
    	
 
    	
06/01/20
    	
 
    	
$
    	
0.00
    	
 
    
	
11
    	
 
    	
07/01/20
    	
 
    	
$
    	
0.00
    	
 
    
	
12
    	
 
    	
08/03/20
    	
 
    	
$
    	
0.00
    	
 
    
	
13
    	
 
    	
09/01/20
    	
 
    	
$
    	
20,686.20
    	
 
    
	
14
    	
 
    	
10/01/20
    	
 
    	
$
    	
19,646.71
    	
 
    
	
15
    	
 
    	
11/02/20
    	
 
    	
$
    	
17,514.26
    	
 
    
	
16
    	
 
    	
12/01/20
    	
 
    	
$
    	
20,884.91
    	
 
    
	
17
    	
 
    	
01/04/21
    	
 
    	
$
    	
15,470.12
    	
 
    
	
18
    	
 
    	
02/01/21
    	
 
    	
$
    	
22,118.06
    	
 
    
	
19
    	
 
    	
03/01/21
    	
 
    	
$
    	
22,177.04
    	
 
    
	
20
    	
 
    	
04/01/21
    	
 
    	
$
    	
18,969.83
    	
 
    
	
21
    	
 
    	
05/03/21
    	
 
    	
$
    	
17,956.81
    	
 
    
	
22
    	
 
    	
06/01/21
    	
 
    	
$
    	
21,288.59
    	
 
    
	
23
    	
 
    	
07/01/21
    	
 
    	
$
    	
20,271.31
    	
 
    
	
24
    	
 
    	
08/02/21
    	
 
    	
$
    	
18,181.58
    	
 
    
	
25
    	
 
    	
09/01/21
    	
 
    	
$
    	
20,415.91
    	
 
    
	
26
    	
 
    	
10/01/21
    	
 
    	
$
    	
20,486.25
    	
 
    
	
27
    	
 
    	
11/01/21
    	
 
    	
$
    	
19,483.83
    	
 
    
	
28
    	
 
    	
12/01/21
    	
 
    	
$
    	
20,630.01
    	
 
    
	
29
    	
 
    	
01/03/22
    	
 
    	
$
    	
17,495.92
    	
 
    
	
30
    	
 
    	
02/01/22
    	
 
    	
$
    	
21,845.95
    	
 
    
	
31
    	
 
    	
03/01/22
    	
 
    	
$
    	
22,976.50
    	
 
    
	
32
    	
 
    	
04/01/22
    	
 
    	
$
    	
19,854.53
    	
 
    
	
33
    	
 
    	
05/02/22
    	
 
    	
$
    	
19,931.28
    	
 
    
	
34
    	
 
    	
06/01/22
    	
 
    	
$
    	
21,064.97
    	
 
    
	
35
    	
 
    	
07/01/22
    	
 
    	
$
    	
21,137.54
    	
 
    
	
36
    	
 
    	
08/01/22
    	
 
    	
$
    	
20,158.54
    	
 
    
	
37
    	
 
    	
09/01/22
    	
 
    	
$
    	
20,236.38
    	
 
    
	
38
    	
 
    	
10/03/22
    	
 
    	
$
    	
19,267.31
    	
 
    
	
39
    	
 
    	
11/01/22
    	
 
    	
$
    	
22,485.16
    	
 
    
	
40
    	
 
    	
12/01/22
    	
 
    	
$
    	
21,511.58
    	
 
    
	
41
    	
 
    	
01/03/23
    	
 
    	
$
    	
18,465.94
    	
 
    
	
42
    	
 
    	
02/01/23
    	
 
    	
$
    	
22,705.32
    	
 
    
	
43
    	
 
    	
03/01/23
    	
 
    	
$
    	
23,810.04
    	
 
    
	
44
    	
 
    	
04/03/23
    	
 
    	
$
    	
18,712.18
    	
 
    
	
45
    	
 
    	
05/01/23
    	
 
    	
$
    	
23,952.84
    	
 
    
	
46
    	
 
    	
06/01/23
    	
 
    	
$
    	
20,935.04
    	
 
    
	
47
    	
 
    	
07/03/23
    	
 
    	
$
    	
19,990.49
    	
 
    
	
48
    	
 
    	
08/01/23
    	
 
    	
$
    	
23,144.67
    	
 
    
	
49
    	
 
    	
09/01/23
    	
 
    	
$
    	
21,175.27
    	
 
    
	
50
    	
 
    	
10/02/23
    	
 
    	
$
    	
21,256.73
    	
 
    
	
51
    	
 
    	
11/01/23
    	
 
    	
$
    	
22,353.80
    	
 
    
	
52
    	
 
    	
12/01/23
    	
 
    	
$
    	
22,430.81
    	
 
    
	
53
    	
 
    	
01/02/24
    	
 
    	
$
    	
20,487.73
    	
 
    
	
54
    	
 
    	
02/01/24
    	
 
    	
$
    	
22,590.83
    	
 
    
	
55
    	
 
    	
03/01/24
    	
 
    	
$
    	
23,673.89
    	
 
    
	
56
    	
 
    	
04/01/24
    	
 
    	
$
    	
21,741.61
    	
 
    
	
57
    	
 
    	
05/01/24
    	
 
    	
$
    	
22,825.11
    	
 
    
	
58
    	
 
    	
06/03/24
    	
 
    	
$
    	
19,911.55
    	
 
    
	
59
    	
 
    	
07/01/24
    	
 
    	
$
    	
24,980.80
    	
 
    
	
60
    	
 
    	
08/01/24
    	
 
    	
$
    	
8,705,906.47