Document:

Exhibit 10.2

 

PROMISSORY NOTE

 

$6,600,000.00

 

August 15, 2018

 

Procaccianti
Hotel REIT, Inc., a Maryland corporation (the “Company”), promises to pay to Procaccianti Companies, Inc.
(the “Holder”), in lawful money of the United States of America, the aggregate principal amount of Six Million
Six Hundred Thousand and 00/100 ($6,600,000.00) Dollars, together with interest thereon at the 4.75% per annum (based on the number
of actual days elapsed and a 365 day year) (the “Interest Rate”). All outstanding unpaid principal, together
with any then unpaid and accrued Interest and other amounts payable hereunder, will be due and payable in cash on the Maturity
Date. For purposes hereof, the “Maturity Date” shall mean August 16, 2019.

 

1.           Definitions.
The following capitalized terms have the following meanings:

 

“Business
Day” means a day other than a Saturday, Sunday or other day on which commercial banks in Providence, Rhode Island
are authorized or required by law to close.

 

“Event
of Default” means any occurrence of an event as described in sections 3 (a), (b) or (c) below.

 

“Interest
Period” means (a) with respect to the initial Interest Period, the period commencing on the execution date
of the note and ending on the last day of the calendar year following the execution date; and (b) with respect to each subsequent
Interest Period, the period commencing on the first day of the calendar year immediately following the preceding Interest Period
and ending on the last day of such calendar year (or, if earlier, the Maturity Date).

 

2.           Payments. The
Company will make payments to the Holder as follows:

 

(a)          Interest. Payments of accrued and unpaid interest on this note at the interest
rate will be due and payable in arrears on the first day of each month until the Maturity Date,

 

(b)         Maturity. All
outstanding principal and any unpaid accrued Interest will be due and payable in full in cash on the Maturity Date.

 

3.           Events
of Default. The occurrence of any of the following will constitute an “Event of Default” under
this note:

 

(a)          Failure
to Pay. The Company fails to pay when due any payment required hereunder or any Interest payment required hereunder or other
payment with respect to the obligations required under the terms of this note on the date when the same becomes due and payable;

 

(b)         Voluntary
Bankruptcy or Insolvency Proceedings. The Company (i) applies for or consents to the appointment of a receiver, trustee,
liquidator or custodian of itself or of all or a substantial part of its property, (ii) admits in writing its inability to
pay its debts generally as they mature, (iii) makes a general assignment for the benefit of its or any of its creditors, (iv) is
dissolved or liquidated, (v) commences a voluntary case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or consent
to any such relief or to the appointment of or taking possession of its property by any official in an involuntary case or other
proceeding commenced against it, or (vi) takes any action for the purpose of effecting any of the foregoing; or

 

     

     

    

 

(c)          Involuntary
Bankruptcy or Insolvency Proceedings. Proceedings for the appointment of a receiver, trustee, liquidator or custodian
of the Company, or of all or a substantial part of the property thereof, or an involuntary case or other proceedings seeking liquidation,
reorganization or other relief with respect to the Company or the debts thereof under any bankruptcy, insolvency or other similar
law now or hereafter in effect will be commenced and an order for relief entered or such proceeding is not dismissed or discharged
within 60 days of commencement.

 

4.           Rights of Holder upon Default.

 

(a)          Rights
and Remedies. Upon the occurrence of an Event of Default under this note and at any time thereafter during the continuance
of such Event of Default, Holder may declare all outstanding obligations payable by the Company hereunder to be immediately due
and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything
contained herein to the contrary notwithstanding. In addition to the foregoing remedies, upon the occurrence and during the continuance
of any Event of Default, the Holder may exercise any other right, power or remedy otherwise permitted by law, either by suit in
equity or by action at law, or both.

 

(b)          Default
Interest. (i) Following the occurrence of and during the continuation of an Event of Default or (ii) in the event
the Company breaches or fails to comply with any of the covenants set forth in Section 3 of this note and
such breach or failure continues for 30 days, the Interest Rate will be increased by two percent, until such time as such Event
of Default, breach or noncompliance is cured or waived by the Holder.

 

(c)          Collection
Costs. The Company agrees to pay in cash on demand all reasonable attorney’s fees and other expenses incurred by
the Holder in the enforcement of any of their rights under this note whether the Event of Default is ultimately cured (if such
cure is permitted) or whether the Holder is obligated to pursue their legal remedies, including such expenses incurred prior to
the institution of legal action, during the pendency of such legal action, during any bankruptcy or insolvency proceeding and continuing
to include all such expenses incurred in connection with any appeal to higher courts arising out of legal proceedings to enforce
the Company’s obligations under this note.

 

(d)          Waivers.
The Company agrees that failure of the Holder to exercise their rights hereunder will not constitute a waiver of the right to exercise
the same in the event of a subsequent Event of Default.

 

5.           Miscellaneous.

 

(a)          Successors
and Assigns. The rights and obligations of the Company and Holder under this note will be binding upon and benefit the successors,
assigns, heirs, administrators and transferees of the parties.

 

    	 	2	 

     

    

 

(b)          Notices. All
notices, requests, demands, consents, instructions or other communications required or permitted hereunder will be in writing and
sent via facsimile transmission or other electronic transmission (including a .pdf sent via electronic mail), mailed or delivered
to each party at the respective address of the Holder listed on the signature page hereto, or at such other address as the such
party may furnish to one the other parties hereto in writing. All such notices and communications will be deemed effectively given
the earlier of (i) when received, (ii) when delivered personally, (iii) one Business Day after being delivered by
facsimile (with receipt of appropriate confirmation), or (iv) one Business Day after being deposited with an overnight courier
service of recognized standing.

 

(c)          Expenses.
In addition to the obligations under Section 4(c), the Company will pay all reasonable costs and expenses associated
with the preparation, negotiation, administration and closing of this note and arising in connection with the obligations hereunder,
including, without limitation, the reasonable fees of one legal counsel to the Holders.

 

(d)          Payment. All
payments will be made in lawful tender of the United States.

 

(e)          Usury. In
the event any Interest paid on this note is deemed to be in excess of the then legal maximum rate, then the portion of the Interest
payment representing an amount in excess of the then legal maximum rate will be deemed a payment of principal and applied against
the principal of this note.

 

(g)          Waivers. The
Company hereby waives notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor and all
other notices or demands relative to this note.

 

(h)          Governing
Law. This note and all actions arising hereunder or in connection herewith will be governed by and construed in accordance
with the laws of the State of Delaware, without regard to the conflicts of law provisions of the State of Delaware, or of any other
state.

 

(i)           Waiver
of Jury Trial. By acceptance of this note, the Holder hereby agrees and the Company hereby agrees to waive their respective
rights to a jury trial of any claim or cause of action based upon or arising out of this note.

 

(Signature Page
Follows.)

 

    	 	3	 

     

    

 

The
Company has caused this note to be issued as of the date first written above.

 

	 	PROCACCIANTI HOTEL REIT, INC., a Maryland corporation
	 	 	 
	 	By:	/s/ James A. Procaccianti
	 	Name:	James A. Procaccianti
	 	Title:	President and CEO

 

    	 	4Exhibit 10.3

 

GENERAL ASSIGNMENT OF PURCHASE AND SALE CONTRACT

 

THIS ASSIGNMENT OF PURCHASE
AND SALE CONTRACT (this “Assignment”) is dated as of August 15, 2018, and is entered into between The Procaccianti
Group, LLC, a Rhode Island limited liability company (the “Assignor”), and Procaccianti Hotel REIT, Inc., a Maryland
corporation and its (indirect) subsidiaries PHR TCI OPCO SUB, LLC, a Delaware limited liability company PHR TCI, LLC, a Delaware
limited liability company (collectively, the “Assignee”).

 

A.          Assignor
is the purchaser under that certain Agreement of Purchase and Sale by and between GRAND TRAVERSE HOTEL PROPERTIES, LLC, a Michigan
limited liability company

(the “Seller”) dated as of March
8, 2018 (as amended, the “Agreement”), with respect to certain real property known as Hotel Indigo, Traverse City located
at 263 West Grandview Parkway, Traverse City, Michigan; and

 

B.           Assignor
desires to assign to Assignee all of Assignor's right, title and interest in and under the Agreement to Assignee; and

 

C.           Assignee
desires to accept such assignment and assume all of Assignor's duties and obligations thereunder.

 

NOW, THEREFORE, in consideration
of the foregoing and other good and valuable consideration, receipt of which is hereby acknowledged, Assignor and Assignee agree
as follows:

 

1.           Assignor
assigns, transfers and sets over to Assignee all of Assignor's right, title and interest in and under the Agreement and any other
permits, rights and obligations arising under the Agreement or the property described therein;

 

2.           Assignee
hereby accepts such assignment and assumes and agrees to perform all of Assignor's duties and obligations arising under the Agreement.

 

3.           Assignor
represents and warrants to Assignee that the Agreement is in full force and effect. Assignor is not in default under the Agreement
and the Seller thereunder has no defense, counterclaim or right of setoff against Assignor; Assignor owned the purchaser's interest
under the Agreement and has the right and authority to make this Assignment, and has not previously assigned, transferred or otherwise
encumbered its rights under the Agreement.

 

[Execution appears on the following page(s).]

 

     

     

    

 

IN WITNESS WHEREOF, the
parties hereto have caused this Assignment to be executed as of the day and year first above written.

 

	 	ASSIGNOR:
	 	 
	 	The Procaccianti Group, LLC
	 	 	 
	 	By:	/s/
    James A. Procaccianti     
	 	 	James A. Procaccianti, a Manager
	 	 	 
	 	ASSIGNEE:
	 	 
	 	PHR TCI, LLC
	 	 	 
	 	By:	/s/ Ron M. Hadar
	 	 	Ron M. Hadar
	 	 	Authorized Signatory

 

    	 	Page 2

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