exv10w33w5w2



 




Exhibit
10.33.5.2



LETTER AGREEMENT




     This letter agreement (the “Agreement”) is made and entered into as of April 5, 2007
by and between Ashford Hospitality Trust, Inc., a Maryland corporation (the “Company”) and
Security Capital Preferred Growth Incorporated, a Maryland corporation (the “Investor”).



Recitals




     WHEREAS, the Company, Ashford Hospitality Limited Partnership, a Delaware limited partnership,
and the Investor have entered into that Series B Cumulative Convertible Redeemable Preferred Stock
Purchase Agreement dated as of December 27, 2004 (the “Purchase Agreement”), as amended by
Amendment No. 1 to the Purchase Agreement and Common Stock Purchase Agreement dated as of February
8, 2005;



     WHEREAS, subject to the conditions set forth herein, the Company desires that the Investor
agree to temporarily amend the financial covenants set forth in Section 6.4 of the Purchase
Agreement (the “Financial Covenants”) and, in consideration therefor, the Investor desires
that the Company agree to delay and condition the application of certain provisions of the
Company’s Articles Supplementary Establishing and Fixing the Rights and Preferences of the Series
B-1 Preferred Stock (the “Articles Supplementary”);



     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants, agreements and
warranties herein contained, the parties hereby agree as follows:



     1. Temporary Amendment




     (a) Subject to the conditions set forth in paragraph (b) of this Section 1, effective with the
execution of this Agreement until the close of business on December 31, 2007 (the “Waiver
Period”), the parties agree that the reference to “75.0%” set forth in clause (ii) of the first
sentence of Section 6.4 of the Purchase Agreement shall be revised to be “85.0%” (the
“Temporary Amendment”). During the Waiver Period, compliance with the Temporary Amendment
shall not be considered a breach or non-performance of such Financial Covenant. Following the
Waiver Period, the Temporary Amendment shall lapse and be of no further effect, and clause (ii) of
the Financial Covenants set forth in Section 6.4 of the Purchase Agreement shall once again refer
to 75.0%.



     (b) Investor’s agreement to the Temporary Amendment is expressly conditioned (the
“Condition”) on the Company completing its acquisition of a 51-hotel portfolio from CNL
Hotels & Resorts, Inc., a Maryland corporation (“CNL”), on or before April 18, 2007,
substantially in accordance with the terms of that certain Purchase and Sale Agreement, by and
between CNL and Ashford Sapphire Acquisition, LLC, a Delaware limited liability company, and
substantially in accordance with the terms of the financing arrangements for such acquisition as
described to the Investor. If the Condition is not satisfied, this entire Agreement shall become
null and void and of no further force or effect.



 









 





     2. Redemption at the Option of the Company




     The Company agrees that it may not redeem the Series B-1 Preferred Stock (as defined in the
Articles Supplementary) prior to January 2, 2008. The parties acknowledge that the Company may
redeem the Series B-1 Preferred Stock pursuant to clause (i) of Section 5(a) of the Articles
Supplementary on January 2, 2008 or any date thereafter, through and including June 14,
2008, and the parties acknowledge that the Company may deliver notice of the redemption
pursuant to Section 5(d) of the Articles Supplementary prior to January 2, 2008, provided, that the
Redemption Date (as defined in the Articles Supplementary) shall be on the 30th day
after providing such notice in the manner set forth in Section 5(d) of the Articles Supplementary
(or, if such 30th day is not a Business Day (as defined in the Articles Supplementary)
on the next succeeding Business Day); provided further, that in order for the Company to redeem the
Series B-1 Preferred Stock during the period January 2, 2008 through June
14, 2008 pursuant to clause (i) of Section 5(a) of the Articles Supplementary, the Company must
be in compliance with the Financial Covenants from the date notice of the redemption is provided to
the Investor in accordance with Section 5(d) of the Articles Supplementary to the Redemption Date. Further, the Company may not redeem the Series B-1 Preferred Stock pursuant to clause
(ii) of Section 5(a) of the Articles Supplementary, which redemption rights commence on June
15, 2008, unless the Company is in compliance with the Financial Covenants from the date notice
of the redemption is provided to the Investors in accordance with Section 5(d) of the Articles
Supplementary to the Redemption Date, and the parties further acknowledge that the Company may
deliver notice of the redemption pursuant to Section 5(d) of the Articles Supplementary prior to
June 15, 2008.



     3. Cure Period




     If
at any time during the Waiver Period or through January 2, 2008, the Company is not in compliance with the Financial
Covenants applicable at the time, the Company shall be considered in breach or
non-performance of a covenant contained in the Purchase Agreement, and the parties agree that such
non-compliance shall be treated for all events as if it had remained uncured for more than 120 days
and therefore will be considered a Covenant Violation (as defined in the Articles Supplementary).
For avoidance of doubt, the Purchase Agreement as in effect immediately following the end of the
Waiver Period shall not include the Temporary Amendment. Also, for avoidance of doubt, for
purposes of determining a Covenant Violation, any breach or non-performance of a covenant contained
in the Purchase Agreement that occurs on or after January 3, 2008 shall not be treated as if it had
remained uncured for more than 120 days and as a result will not be considered a Covenant Violation
unless and until such breach or non-compliance remains uncured for 120 days.



     4. Reservation of Rights




     Except as otherwise expressly provided in this Agreement, and both during and following the
expiration of the Waiver Period, the Purchase Agreement and the Articles Supplementary shall each
remain in full force and effect, and shall not be otherwise waived or modified by this Agreement.
The Company and the Investor expressly reserve any and all rights, claims and



 









 







remedies that they have or may have against the other under the Purchase Agreement, the
Articles Supplementary, applicable law or otherwise.



     5. Amendments




     No amendment or modification of any provision of this Agreement shall be effective without the
written agreement of the parties, and no termination or waiver of any provision of this Agreement,
or consent to any departure from the obligations hereunder, shall in any event be effective without
the written consent of the parties.



     6. Successors and Assigns




     Except as otherwise provided herein, the terms and conditions of this Agreement shall inure to
the benefit of and be binding upon the respective successors and assigns of the parties hereto.



     7. Sole Benefit




     This Agreement is solely for the benefit of the parties hereto and their respective successors
and assigns, and no other person shall have any right, benefit or interest under or because of the
existence of this Agreement.



     8. Governing Law




          This Agreement shall be governed by and construed in accordance with the laws of the State of
Maryland, without giving effect to the conflict of law provisions thereof. Each party hereby
irrevocably submits to the non-exclusive jurisdiction of the state and federal courts sitting in
the city of Chicago for the adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees
not to assert in any suit, action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient
forum or that the venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof to such party at the address for such notices
to it under this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY
DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.




     9. Counterparts




          This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument.




 









 








     10. Section Titles




     The title and subtitles used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.



     11. Severability




     Any provision of this Agreement held to be invalid, illegal or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity,
illegality or unenforceability without affecting the validity, legality and enforceability of the
remaining provisions hereof, and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.



 









 





     Executed and delivered as of the date first written above.



	 	 	 	 	 
	SECURITY CAPITAL PREFERRED

GROWTH INCORPORATED

 	 	 
	By:  	/s/
Anthony R. Manno, Jr. 	 	 
	 	Name:  	Anthony R. Manno, Jr. 	 	 
	 	Title:  	President 	 	 
	 
	ASHFORD HOSPITALITY TRUST, INC.

 	 	 
	By:  	/s/
David A. Brooks 	 	 
	 	Name:  	David A. Brooks 	 	 
	 	Title:  	Chief Legal Officer