HOTEL FOR THE FISCAL YEAR.
SUCH PROJECTION SHALL PROJECT THE ESTIMATED
GROSS REVENUES, DEPARTMENTAL PROFITS, OPERATING COSTS AND OPERATING PROFIT FOR
THE FISCAL YEAR FOR EACH HOTEL.
ARTICLE 2
SCOPE OF AGREEMENT
2.1
ENGAGEMENT OF MANAGER.
SUBJECT TO THE TERMS OF THIS AGREEMENT,
OWNER HEREBY GRANTS TO MANAGER THE SOLE AND EXCLUSIVE RIGHT TO SUPERVISE AND
DIRECT THE MANAGEMENT AND OPERATION OF THE HOTELS FOR THE TERM AS OWNER'S AGENT
COUPLED WITH AN INTEREST.
MANAGER HEREBY ACCEPTS SAID GRANT AND AGREES THAT IT
WILL CONTROL, SUPERVISE AND DIRECT THE MANAGEMENT AND OPERATION OF THE HOTELS,
ALL SUBJECT TO THE TERMS, REQUIREMENTS AND CONDITIONS OF THIS AGREEMENT, WITH
COMMERCIALLY REASONABLE EFFORTS IN DOING SO AND IN AN EFFICIENT AND ECONOMICAL
MANNER CONSISTENT WITH STANDARDS PREVAILING IN WELL MANAGED HOTELS SIMILAR TO
THE HOTELS, INCLUDING ALL ACTIVITIES IN CONNECTION THEREWITH WHICH ARE CUSTOMARY
AND USUAL TO SUCH AN OPERATION
23
(THE FOREGOING STANDARDS CONSTITUTING THE "OPERATING STANDARDS").
OWNER
ACKNOWLEDGES THAT THE EXPANSION HOTELS ARE TO BE CONVERTED TO THE BRAND
STANDARDS FOLLOWING THE EXPANSION HOTELS EFFECTIVE DATE.
MANAGER SHALL COMPLETE
SUCH CONVERSION PROMPTLY AFTER THE EXPANSION HOTELS EFFECTIVE DATE, BUT IN ALL
EVENTS ON OR BEFORE DECEMBER 31, 2008; PROVIDED, HOWEVER, MANAGER SHALL NOT BE
OBLIGATED TO CAUSE THE EXPANSION HOTELS TO CONFORM WITH THE REQUIREMENTS OF THE
BRAND STANDARDS WHICH HAVE BEEN WAIVED AS SET FORTH ON EXHIBIT E.
SUBJECT TO
THE TERMS AND CONDITIONS OF THIS AGREEMENT, THE OPERATING STANDARDS AND THE
BRAND STANDARDS, MANAGER SHALL HAVE THE RIGHT TO DETERMINE OPERATING POLICY,
STANDARDS OF OPERATION, QUALITY OF SERVICE AND ANY OTHER MATTERS AFFECTING
CUSTOMER RELATIONS OR MANAGEMENT AND OPERATION OF THE HOTELS.
WITHOUT LIMITING
THE GENERALITY OF THE FOREGOING, AND IN ADDITION TO THE OTHER FUNCTIONS TO BE
PERFORMED BY MANAGER PURSUANT TO THIS AGREEMENT, MANAGER SHALL, IN CONNECTION
WITH THE HOTELS AND IN ACCORDANCE WITH THE BRAND STANDARDS, THE OPERATING
STANDARDS AND THE TERMS OF THIS AGREEMENT, PERFORM EACH OF THE FOLLOWING
FUNCTIONS, PROVIDED, HOWEVER, EXCEPT AS OTHERWISE SET FORTH IN THIS AGREEMENT,
THE COSTS AND EXPENSES OF PERFORMING THE FOLLOWING FUNCTIONS SHALL BE OPERATING
COSTS:
(A)
ESTABLISH AND REVISE, AS NECESSARY, ADMINISTRATIVE POLICIES AND
PROCEDURES, INCLUDING POLICIES AND PROCEDURES FOR THE CONTROL OF REVENUE AND
EXPENDITURES, FOR THE PURCHASING OF SUPPLIES AND SERVICES, FOR THE CONTROL OF
CREDIT, AND FOR THE SCHEDULING OF MAINTENANCE, AND VERIFY THAT THE FOREGOING
PROCEDURES ARE OPERATING IN A SOUND MANNER.
(B)
MANAGE EXPENDITURES TO REPLENISH OPERATING SUPPLIES AND OPERATING
EQUIPMENT, MAKE PAYMENTS ON ACCOUNTS PAYABLE AND COLLECT ACCOUNTS RECEIVABLE.
(C)
ARRANGE FOR AND SUPERVISE PUBLIC RELATIONS AND ADVERTISING AND
PREPARE MARKETING PLANS.
(D)
PROCURE ALL OPERATING SUPPLIES AND REPLACEMENT OPERATING
EQUIPMENT.
(E)
PROVIDE, OR CAUSE TO BE PROVIDED, RISK MANAGEMENT SERVICES
RELATING TO THE TYPES OF INSURANCE REQUIRED TO BE OBTAINED OR PROVIDED BY
MANAGER UNDER THIS AGREEMENT.
(F)
REASONABLY COOPERATE (PROVIDED THAT EXCEPT AS HEREIN EXPRESSLY
PROVIDED MANAGER SHALL NOT BE OBLIGATED TO ENTER INTO ANY AMENDMENTS OF THIS
AGREEMENT OR, UNLESS OWNER AGREES TO REIMBURSE MANAGER THEREFOR, TO