Document:

Ex 10.224

Environmental Indemnity Agreement
This Environmental Indemnity Agreement (this “Agreement”), dated as of August 3, 2022 (the “Effective Date”), is made, by LF3 RIFC, LLC, a Delaware limited liability company and LF3 RIFC TRS, LLC, a Delaware limited liability company (collectively, “Borrower”) and Lodging Fund REIT III OP, LP, a Delaware limited partnership (“Guarantor” and collectively with Borrower, “Indemnitor”) in favor of Legendary A-1 Bonds, LLC, a Delaware limited liability company (“Lender”).
Recitals:
1.Borrower is indebted to Lender pursuant to the Tranche 1 Promissory Note in the principal amount of $10,298,535.00 dated the Effective Date from Borrower payable to the order of Lender, issued pursuant to the Loan Agreement dated as of the Effective Date between Lender and Borrower (the “Loan”).
2.The Loan is secured by, among other things, a Deed of Trust, Security Agreement, Assignment of Leases, Assignment of Rents, and Financing Statement and dated the Effective Date from Borrower to The Public Trustee of the County of Larimer, State of Colorado, as trustee, for the benefit of Lender, to be recorded in the real property records of Larimer County, Colorado (the “Security Instrument”) encumbering the property as more particularly described therein (the “Property”).
3.Guarantor has provided a guaranty of the obligations of Borrower under the Loan pursuant to that certain Continuing Guaranty of even date herewith.
4.As a condition to making the Loan, Lender requires Indemnitor to indemnify and hold Lender harmless from any Environmental Claim, any requirements or violations of any Environmental Laws, any violation of any Environmental Permit and all Costs related to any of the foregoing related to the Property.

Agreement
For good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties hereto agree as follows:
1.Definitions. As used herein, the following terms have the meanings assigned:
“Costs” means all liabilities (including strict liabilities), losses, costs, damages (including consequential damages or indirect), expenses, claims, reasonable attorneys’ fees, experts’ fees, consultants’ fees and disbursements of any kind or of any nature whatsoever. For the purposes of this definition, such losses, costs and damages will include, without limitation, remedial, removal, response, abatement, cleanup, legal, investigative and monitoring costs, expenses, losses, damages, penalties, fines, obligations, defenses, judgments, suits, forfeitures, proceedings and disbursements.
“Environmental Claim” means, but not be limited to, any claim, demand, action, cause of action, suit, loss, cost, damage, fine, penalty, expense, liability, judgment, forfeitures, proceeding, or injury, whether threatened, sought, brought, or imposed, that seeks to impose costs or liabilities for (i) noise; (ii) pollution or contamination of the air, surface water, groundwater, or soil; (iii) solid, gaseous, or liquid waste generation, handling, treatment, storage, disposal, or transportation; (iv) exposure to Hazardous Materials; (v) the generation, handling, treatment, transportation, manufacture, processing, distribution in commerce, use, storage or disposal of Hazardous Materials; (vi) injury to or death of any person or persons directly or indirectly connected with Hazardous Materials and directly or indirectly related to the Property; 

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Ex 10.224

(vii) destruction or contamination of any property directly or indirectly in connection with Hazardous Materials and directly or indirectly related to the Property; or (viii) any and all penalties directly or indirectly connected with Hazardous Materials and directly or indirectly related to the Property. The term “Environmental Claim” also includes (i) the costs of removal of any and all Hazardous Materials from all or any portion of the Property, (ii) costs required to take necessary precautions to protect against the release of Hazardous Materials at, on, in, about, under, within, near or in connection with the Property in or into the air, soil, surface water, groundwater, or soil vapor, any public domain, or any surrounding areas, (iii) costs incurred to comply, in connection with all or any portion of the Property or any surrounding areas, with all applicable laws with respect to Hazardous Materials, including any such laws applicable to the work referred to in this sentence, and (iv) the costs of site investigation, response, and remediation of any and all Hazardous Materials at, on, about, under, within, near or in all or any portion of the Property. “Environmental Claim” also includes any asserted or actual breach or violation of any requirements of Environmental Laws, or any event, occurrence, or condition as a consequence of which, pursuant to any requirements of Environmental Laws, (i) Borrower, Lender, or any owner, occupant, or person having any interest in the Property will be liable or suffer any disability, or (ii) the Property will be subject to any restriction on use, ownership, transferability, or (iii) any Remedial Work will be required.
“Environmental Laws” means any and all present and future federal, state and local law (whether under common law, statute, rule, ordinance, agreement, regulation or otherwise) requirement under any permit issued with respect thereto, and other requirements of governmental authorities having jurisdiction thereunder relating to pollution or the protection of the environment, including, without limitation, (a) The Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by The Superfund Amendments and Reauthorization Act, (b) The Resource Conservation Recovery Act, as amended by The Hazardous and Solid Waste Amendments of 1985, (c) any local, state or federal laws, rules, regulations or ordinances (whether in existence on the date of this Agreement or executed or promulgated after the date hereof) concerning the management, control, discharge, treatment, containment and/or removal of substances or materials that are or may become a threat to public health or the environment, or (d) any common law theory involving materials or substances which are (or are alleged to be) hazardous to human health or the environment.  
“Environmental Permit” means any permit, license, approval, or other authorization with respect to any activities, operations, or businesses conducted on or in relation to the Property under any applicable law, regulation, or other requirement of the United States or any state, municipality, or other subdivision or jurisdiction related to pollution or protection of health or the environment, or any private agreement (such as covenants, conditions and restrictions), including laws, regulations or other requirements relating to spills, emissions, discharges, or releases or threatened releases of Hazardous Materials into ambient air, surface water, groundwater, or soil, or otherwise relating to the manufacture, processing, distribution, use, generation, treatment, storage, disposal, transportation, or handling of Hazardous Materials directly or indirectly related to the Property.
“Hazardous Materials” means any chemical, compound, material, mixture or substance (not generally found in the operation or maintenance of a limited select service hotel) that is now or hereafter defined or listed in, or otherwise classified pursuant to, any Environmental Laws as a “hazardous substance,” “hazardous material,” “hazardous waste,” “acutely hazardous”, “extremely hazardous waste,” infectious waste,” “toxic substance,” “toxic pollutant” or any other formulation intended to define, list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, or toxicity, including any petroleum, natural gas, natural gas liquids, liquified natural gas, or synthetic gas usable for fuel (or mixtures of natural gas and such synthetic gas) or derivatives thereof. “Hazardous Materials” will also include, without 

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Ex 10.224

limitation, those substances listed in the United States Department of Transportation Table (49 CFR 172.101, as amended), spillage, seepage, storage, holding, existence or suspected existence, release or suspected releases, emission, discharge, disposal, generation, processing, abatement, removal, disposition, handling, transportation or other use of any Hazardous Materials from, at, under, into, on, about, within, near or in connection with the Property or surrounding property. The term “Hazardous Materials” does not include any Hazardous Materials used in connection with routine construction, maintenance, repair and operation of the Property in compliance with Environmental Law and in amounts or concentrations which do not violate Environmental Laws.
“Hazardous Materials Activity” will include any activity relating to such Hazardous Materials.
“Transfer Date” means the earlier of the date (i) the lien of the Security Instrument is foreclosed or a conveyance by deed in lieu of such foreclosure is fully effective and (ii) a receiver is appointed by a court for the Property, which receiver is requested by Lender, and in each case Borrower and/or its affiliates are no longer in possession of the Property; provided, if such foreclosure, conveyance or appointment is challenged, in bankruptcy proceedings or otherwise, the Transfer Date will be deemed not to have occurred until such challenge is rejected, dismissed or withdrawn with prejudice. If the Transfer Date is triggered by the appointment of a receiver as provided in clause (ii) of this definition, the receiver is subsequently dismissed and the Borrower once again has possession of the Property, the term “Transfer Date” means the period of time during which the receiver had possession of the Property.
2.Indemnification.
(a)Indemnitor hereby agrees to protect, defend, indemnify, reimburse, and hold harmless Lender and its officers, directors, shareholders, agents, employees and attorneys and their respective heirs, legal representatives, successors and assigns (all such persons and entities individually an “Indemnitee” and collectively the “Indemnitees”) from and against all Costs, which at any time may be imposed upon the Property, the Indemnitees, or any of them, arising out of or in connection with any one or more of the following, even if caused by the negligence of an Indemnified Party, but not if caused by the willful misconduct or gross negligence of an Indemnified Party: (i) the breach of any representation, warranty or covenant contained in the Loan Documents (as defined in the Loan Agreement) relating to the Hazardous Materials; (ii) any requirements of Environmental Laws; (iii) Environmental Claims; (iv) the failure of Borrower, or any other party directly or indirectly connected with the Property, or affiliated with Borrower to obtain, maintain, or comply with any Environmental Permit, beyond the any applicable notice and cure period; (v) the conduct of any Hazardous Materials Activity; and/or (vi) the presence or existence of Hazardous Materials at, on, about, under, within, near or in connection with the Property, but only with respect to matters occurring or conditions existing prior to the Transfer Date.
(b)In the event that any investigation, monitoring, response, remediation, removal, restoration, abatement, repair, cleanup, detoxification or other ameliorative work is required by Lender or any agency, governmental or private, having jurisdiction over Hazardous Materials or Hazardous Materials Activity (the “Remedial Work”), Indemnitor will within thirty (30) days after written demand for performance thereof by any Indemnitees or any such agency (or such shorter period of time as may be required under any applicable Environmental Laws), promptly commence, or cause to be commenced, and thereafter diligently prosecute to completion, all such Remedial Work, but only with respect to matters occurring or conditions existing prior to the Transfer Date. All Remedial Work will be performed by one or more contractors, approved in advance in writing by Lender, and, if required by Lender, under the supervision of a 

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Ex 10.224

consulting engineer approved in advance in writing by Lender. All Costs related to such Remedial Work will be paid by Indemnitor including, without limitation, Costs incurred by any Indemnitee in connection with oversight, monitoring or review of such Remedial Work. In the event Indemnitor will fail to promptly commence, or cause to be commenced, or fail to diligently prosecute to completion, such Remedial Work, Lender may, but will not be required to, cause such Remedial Work to be performed and all Costs will become an Environmental Claim hereunder.
(c)This Agreement, and all rights and obligations hereunder, are separate and distinct from the rights and obligations of Borrower and Lender under the Loan Documents and will survive (i) payment of all amounts payable pursuant to the Note and secured by the Security Instrument, (ii) surrender of the Note; (iii) release, satisfaction, assignment or reconveyance of the Security Instrument or other security provided in connection with the Loan; (iv) foreclosure of the Security Instrument and other security instruments in connection with the Loan; (v) acquisition of the Property by Lender; or (vi) transfer of any or all Lender’s rights in the Loan and the Property, except to the extent specifically set forth herein. The indemnities and releases set forth herein will benefit all parties who have been, or are currently, a “Lender” under the Loan Agreement.
(d)Nothing contained in this Agreement will prevent or in any way diminish or interfere with any rights or remedies, including, without limitation, the right to contribution, which any Indemnitee may have against Borrower or any other party under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (codified at Title 42 U.S.C. § 9601 et seq.), as it may have been or may be amended from time to time, or any other Environmental Laws, all such rights being hereby expressly reserved.
3.Notice of Actions. Indemnitor and Lender each agree to give the other prompt written notice of the receipt of any notice or discovery of any information regarding any actual, alleged or potential Environmental Claim or any claim under this Agreement, and to deliver copies of any and all orders, notices, permits, reports, and other communications, documents and instruments pertaining to such Environmental Claim.
4.Procedure Relating to Indemnification.
(a)Any Indemnitee will have the right to join and participate in, as a party if such Indemnitee so elects, any legal proceedings or actions in connection with the Property involving any Environmental Claim, any Hazardous Materials or any requirements of Environmental Laws, and Indemnitor will reimburse such Indemnitee upon demand for all of its Costs in connection therewith, but only with respect to Costs arising from or relating to matters occurring or conditions existing prior to the Transfer Date.
(b)In any circumstances in which this Agreement applies, any Indemnitee may, but will not be obligated to, employ its own legal counsel and consultants to investigate, prosecute, negotiate, or defend any such circumstances, including, but not limited to, any Environmental Claim, and such Indemnitee will have the right to compromise or settle the same without the necessity of showing actual liability therefor, and without the consent of Indemnitor. Indemnitor will reimburse such Indemnitee, upon demand, for all Costs incurred by such Indemnitee, including the amount of all Costs of settlements entered into by Indemnitees, but only with respect to Costs arising from or relating to matters occurring or conditions existing prior to the Transfer Date.
(c)Indemnitor will not, without the prior written consent of Lender (i) settle or compromise any action, suit, proceeding, or claim or consent to the entry of any judgment that does not 

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Ex 10.224

include as an unconditional term thereof and delivery by the claimant or plaintiff to Lender of (x) a full and complete written release of Indemnitees (in form, scope and substance satisfactory to Lender in its sole discretion) from all liability in respect to such action, suit or proceeding and (y) a dismissal with prejudice of such suit, action or proceeding; or (ii) settle or compromise any action, suit, proceeding, or claim in any manner that may adversely affect Indemnitee as determined by Lender in its sole discretion.
5.Binding Effect.
(a)This Agreement will be binding upon Borrower and Guarantor, their respective successors and permitted assigns and will inure to the benefit of the Indemnitees and their successors and assigns, without limitation, any holder of the Note and any affiliates of Lender which acquires all or part of the Property by any sale, assignment, deed in lieu of foreclosure, foreclosure under the Security Instrument, or otherwise. The obligations of Indemnitor under this Agreement will not be assigned, voluntarily or by operation of law, without the prior written consent of Lender which consent may be given or withheld in the sole discretion of Lender.
(b)In the event of a dissolution of Indemnitor or other disposition involving Indemnitor or all or substantially all the assets of Indemnitor to one or more persons or other entities, the surviving entity or transferee of assets, as the case may be, will (i) be formed and existing under the laws of a state, district or commonwealth of the United States of America and (ii) deliver to Lender an acknowledged instrument in recordable form assuming all obligations, covenants and responsibilities of Indemnitor under this Agreement.

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Ex 10.224

6.Enforcement of Agreement. Failure of Indemnitor to satisfy its obligations under this Agreement will constitute an Event of Default under the Loan Agreement; provided that the liability of Indemnitor under this Agreement will in no way be limited or impaired by the provisions of the Loan Documents, or any amendment, modification, extension or renewal thereof. This Agreement may be enforced by Lender or any Indemnitee without regard to any other rights and remedies existing against Borrower under the Loan Documents. Enforcement of this Agreement will not be deemed to constitute an action for recovery of the Loan indebtedness nor for recovery of a deficiency judgment against Borrower following foreclosure of the Security Instrument. Indemnitor expressly and specifically agrees that a separate action or actions may be brought and prosecuted against Indemnitor whether or not action is brought against Indemnitor or any other indemnitor and whether or not Indemnitor is joined in any action against such indemnitor on this Agreement. Lender would not make the Loan without this Agreement and Indemnitor acknowledges and understands that this Agreement is a material inducement for their agreement to make the Loan..
7.Waiver. Indemnitor waives any right or claim of right to cause a marshaling of the assets of Indemnitor or to cause Lender to proceed against any of the security for the Loan before proceeding under this Agreement against Indemnitor. Indemnitor agrees that any payments required to be made hereunder will become due on demand made in writing by a Indemnified Party. Indemnitor expressly waives and relinquishes all rights, remedies or defenses accorded by applicable law to indemnitors or guarantors, except any rights of subrogation that Indemnitor may have, provided that the indemnity provided for hereunder will neither be contingent upon the existence of any such rights of subrogation nor subject to any claims or defenses whatsoever that may be asserted in connection with the enforcement or attempted enforcement of such subrogation rights, including, without limitation, any claim that such subrogation rights were abrogated by any acts or omissions of Lender.
8.Notices. All notices, consents, approvals, elections and other communications hereunder will be given and received (or deemed received) in accordance with the terms of the Loan Agreement.
9.Attorneys’ Fees. In the event that any either party brings or otherwise becomes a party to any suit or other proceeding (including, without limitation, any administrative proceedings) with respect to the subject matter or enforcement of this Agreement, such prevailing party will, in addition to such other relief as may be awarded, be entitled to recover from non-prevailing party its reasonable attorneys’ fees, expenses and costs of investigation as are reasonably incurred, provided that a determination is final, non-appealable order with respect to such litigation, claim or otherwise.
10.Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of Colorado.
11.Successive Actions. A separate right of action hereunder will arise each time an Indemnitee acquires knowledge of any matter indemnified by Indemnitor under this Agreement. Separate and successive actions may be brought hereunder to enforce any of the provisions hereof at any time and from time to time. No action hereunder will preclude any subsequent action, and Indemnitor hereby waives and covenants not to assert any defense in the nature of splitting of causes of action or merger of judgments.
12.Severability. The invalidity or unenforceability of one or more covenants, terms, or conditions in this Agreement will not affect the remainder of this Agreement.

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Ex 10.224

13.Interest on Unpaid Amounts. All amounts required to be paid or reimbursed to any Indemnitee hereunder will bear interest from the date of written demand to Indemnitor until paid to Indemnitee(s). The interest rate will be the “Interest Rate” specified in the Loan Agreement.
14.Joint and Several Liability. The obligations of each Indemnitor, if more than one, under this Agreement will be the joint and several obligations of each of them.
15.Recitals. All of the Recitals set forth above are true and correct and are incorporated herein by this reference.
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Ex 10.223

The  undersigned have executed this Agreement as of the date first set forth above.
BORROWER:
LF3 RIFC, LLC,
a Delaware limited liability company
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By: Lodging Fund REIT III OP, LP,
a Delaware limited partnership, its sole member
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By:Lodging Fund REIT III, Inc.,
a Maryland corporation, its general partner
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By: /s/ Samuel C. Montgomery
Name:  Samuel C. Montgomery
Title:  Chief Financial Officer
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LF3 RIFC TRS, LLC,
a Delaware limited liability company
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By: Lodging Fund REIT III TRS, Inc.,
a Delaware corporation, its sole member
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By: /s/ Samuel C. Montgomery 
Name:  Samuel C. Montgomery
Title:  Chief Financial Officer
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GUARANTOR:
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Lodging Fund REIT III OP, LP,
a Delaware limited partnership
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By: Lodging Fund REIT III, Inc.,
a Maryland corporation, its general partner
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By: /s/ Samuel C. Montgomery
Name:  Samuel C. Montgomery
Title:  Chief Financial Officer

​Ex 10.225

This document prepared by and after
Recording return to:
Foley & Lardner, LLP
2021 McKinney Ave., Suite 1600
Dallas, Texas  75201
Attn:Clifton M. Dugas, II
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ASSIGNMENT OF LEASES AND RENTS
STATE OF COLORADO§
§
COUNTY OF LARIMER§
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THIS ASSIGNMENT OF LEASES AND RENTS (this “Assignment”) is made as of August 3, 2022 by and from LF3 RIFC, LLC and LF3 RIFC TRS, LLC, each a Delaware limited liability company (collectively, the “Borrower”), to and for the benefit of Legendary A-1 Bonds, LLC, a Delaware limited liability company, its successors and assigns (“Lender”).
RECITALS:
A.Borrower is the owner of certain real property located in Larimer County, State of Colorado, as more particularly described in Exhibit A attached hereto (“Property”).
B.Lender has agreed to make a loan to Borrower in the maximum principal amount of $10,298,535.00 (the “Loan”) pursuant to that certain Loan Agreement of even date herewith by and between Borrower and Lender (together with all renewals, amendments, modifications, increases and extensions thereof, the “Loan Agreement”).  The Loan is evidenced by a Tranche 1 Promissory Note of even date herewith from Borrower and payable to the order of Lender in the original principal amount of $10,298,535.00 (together with all renewals, amendments, modifications, increases and extensions thereof, the “Note”).
C.The Loan is secured by:  (i) that certain Deed of Trust, Security Agreement, Assignment of Leases, Assignment of Rents, and Financing Statement of even date herewith on the Property (the “Security Instrument”), and (ii) certain other documents evidencing or securing the Loan (together with the Note, the Loan Agreement and the Security Instrument, as amended, modified, replaced or restated from time to time, the “Loan Documents”).
D.Borrower is required as a condition to the making of the Loan to transfer and assign to Lender all of Borrower’s right, title and interest in, to and under the Leases and Rents (as defined below).
AGREEMENT:
NOW, THEREFORE, as an inducement for the making of the Loan, Borrower hereby represents, warrants, covenants and agrees as follows:
1.Definitions.  As used herein, the following terms shall have the following meanings:
“Event of Default” means (i) any default hereunder, after the expiration of any cure periods expressly provided for herein, and (ii) an Event of Default, as defined in the Loan Agreement.

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Ex 10.225

“Leases” means all leases, subleases, rental contracts, occupancy agreements, licenses and other arrangements (in each case whether existing now or in the future) pursuant to which any person or entity occupies or has the right to occupy or use any portion of the Property, and includes (a) any supplement, modification, amendment, renewal or extension of any Lease and (b) any security or guaranty for any Lease.
“Lessees” means the lessees under the Leases or any subtenants or occupants of the Property.
“Notice of Enforcement” means a notice from Lender to any Lessee under a Lease instructing each such Lessee under a Lease to pay all current and future Rents under the Leases directly to Lender, and attorn in respect of all other obligations thereunder directly to Lender.
“Rent Demand”:  A notice to Borrower sent by Lender demanding payment by Borrower to Lender of all unpaid accrued Rents and all unaccrued Rents as they accrue. 
“Rents” means all rents, issues, income, revenues, royalties, profits and other amounts now or in the future payable under any of the Leases, including those past due and unpaid.
Capitalized terms used in this Assignment and not otherwise defined are used as defined in the Loan Agreement.
2.Assignment.  As security for the payment and performance of the Obligations, Borrower hereby absolutely and unconditionally transfers, sets over and assigns to Lender all present and future right, title and interest of Borrower in, to and under the Leases and the Rents, together with all advance payments, security deposits and other amounts paid or payable to or deposited with Borrower under any of the Leases and all other rights and interests of Borrower under or in respect of any of the Leases.  This Assignment is intended to be and is an absolute present assignment from Borrower to Lender, it being intended hereby to establish a complete and present transfer of all Leases and Rents with the right, but without the obligation, to collect all Rents.
3.License.  Except as hereinafter set forth, Borrower shall have a license to collect the Rents accruing under the Leases as they become due (“License”), but not in advance, and to enforce the Leases.  The License may terminate as set forth in Section 8 hereof upon the occurrence of an Event of Default.  Borrower covenants and agrees that in exercising its License it shall hold all Rents in trust and shall apply the same first to the payment of the reasonable expenses of owning, maintaining, repairing, operating and renting the Property, and then to payment of the Obligations.
4.Representations and Warranties.  Borrower hereby represents and warrants to Lender that:  (a) Borrower is the absolute owner of the entire lessor’s interest in each of the Leases, with absolute right and title to assign the Leases and the Rents; (b) to Borrower’s knowledge, the Leases are valid, enforceable and in full force and effect and have not been modified, amended or terminated; (c) there are no outstanding assignments or pledges of the Leases or of the Rents and no other party has any right, title or interest in the Leases or the Rents; (d) there are no existing defaults under the provisions of the Leases on the part of the lessor and to Borrower’s knowledge, there are no existing defaults under the provisions of the Leases on the part of the Lessees thereunder; (e) to Borrower’s knowledge, no Lessee has any defense, set-off or counterclaim against Borrower; (f) except as disclosed in writing to Lender, no Lessee has any purchase option or first refusal right or any right or option for additional space with respect to the Property; (g) Borrower has not accepted prepayments of installments of rent or any other charges under any Lease for a period of more than one (1) month in advance; and (h) to Borrower’s knowledge, except as otherwise disclosed to Lender in writing, all work required to be performed by Borrower, as landlord, as of the date hereof under any Lease has been completed in accordance with the provisions of the Lease.  
5.Covenants of Borrower.
		(a)	New Leases and Lease Terminations and Modifications.  Borrower shall not enter into, cancel, surrender or terminate (except as a result of a material default by the Lessees thereunder and failure of any such Lessee to cure the default within the applicable time periods, if any, set forth in any Lease), amend or modify any Lease, or make any subsequent assignment or pledge of a Lease, or consent to the subordination of the interest of any 

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Ex 10.225

			Lessee in any Lease, or consent to any assignment by any Lessee or any subletting, without the prior written consent of Lender, which consent shall not be unreasonably withheld.  Any attempt to do any of the foregoing without the prior written consent of Lender (if such consent is required) shall be null and void. Notwithstanding the foregoing, this covenant does not apply to transient guest Leases, short term in nature, so long as such Leases are performed in a reasonably commercial manner consistent with practices of Borrower.

		(b)	Performance under Leases.  Borrower shall observe and perform all of the covenants, terms, conditions and agreements contained in the Leases to be observed or performed by the lessor thereunder, and Borrower shall not do or suffer to be done anything to impair the security thereof.  Borrower shall not (i) release the liability of any Lessee under any Lease or any guaranty thereof, (ii) consent to any Lessee’s withholding of rent or making monetary advances and off-setting the same against future rentals, except in the ordinary course of such transient guest Leases, (iii) consent to any Lessee’s claim of a total or partial eviction, (iv) consent to a termination or cancellation of any Lease, except as specifically provided above or in such Lease, or (v) enter into any oral leases or orally amend or modify any Lease with respect to all or any portion of the Property;

		(c)	Collection of Rents.  Borrower shall not collect any of the Rents, issues, income or profits assigned hereunder more than thirty (30) days in advance of the time when the same shall become due, except for security or similar deposits;

		(d)	Further Assignment.  Borrower shall not make any other assignment of its entire or any part of its interest in or to any or all Leases, or any or all Rents, except as specifically permitted by the Loan Documents;

		(e)	Lease Guaranty.  Borrower shall not alter, modify or change the terms of any guaranty of any Lease, or cancel or terminate any such guaranty or do or permit to be done anything which would terminate any such guaranty as a matter of law;

		(f)	Waive Rental Payments.  Borrower shall not waive or excuse the obligation to pay rent under any Lease, except as otherwise provided in such Lease;  

		(g)	Defending Actions.  Borrower shall, at its sole cost and expense, appear in and defend any and all actions and proceedings arising under, relating to or in any manner connected with any Lease or the obligations, duties or liabilities of the lessor or any Lessee or guarantor thereunder, and shall pay all costs and expenses of the Lender, including court costs and reasonable attorneys’ fees, in any such action or proceeding in which the Lender may appear;

		(h)	Enforcement.  Borrower shall enforce the observance and performance of each covenant, term, condition and agreement contained in each Lease to be observed and performed by the Lessees and guarantors thereunder;

		(i)	Notice.  Borrower shall immediately notify the Lender of any material breach by a Lessee or guarantor under any Lease;  

		(j)	Subordination.  Borrower shall not permit any of the Leases to become subordinate to any lien or liens other than liens securing the Obligations secured hereby or liens for general real estate taxes not delinquent; and

		(k)	Bankruptcy of Lessee.  If any Lessee is or becomes the subject of any proceeding under the Federal Bankruptcy Code, as amended from time to time, or any other federal, state or local statute which provides for the possible termination or rejection of the Leases assigned hereby, Borrower covenants and agrees that if any such Lease is so terminated or rejected, no settlement for damages shall be made without the prior written consent of Lender, and any check in payment of damages for termination or rejection of any such Lease will be made payable both to Borrower and Lender.  Borrower hereby assigns any such payment 

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Ex 10.225

			to Lender and further covenants and agrees that upon the request of Lender, it will duly endorse to the order of the Lender any such check.

6.Cancellation of Lease.  In the event that any Lease permits cancellation thereof on payment of consideration and the privilege of cancellation is exercised, the payments made or to be made by reason thereof are hereby assigned to Lender, and if an Event of Default has occurred, shall be applied, at the election of Lender, to the Obligations in whatever order Lender shall choose in its discretion or shall be held in trust by Lender as further security, without interest, for the payment of the Obligations.  Prior to such Event of Default, Borrower may use and apply such termination payments to expenses of the Property; provided, however, that Borrower shall notify Lender in writing of the receipt and amount of any such termination payments and the name of the tenant from whom such termination payment was received.
7.Lender’s Rights Upon Lessee Bankruptcy.  Upon the occurrence of an Event of Default, and if a Lessee under a Lease files or has filed against it any petition in bankruptcy or for reorganization, or undertakes or is subject to similar action, Lender shall have, and is hereby assigned by Borrower, all of the rights which would otherwise inure to the benefit of Borrower in such proceedings, including, without limitation, the right to seek “adequate protection” of its interests, to compel rejection of any Lease, and to seek such claims and awards as may be sought or granted in connection with the rejection of such Lease.  Unless otherwise consented to by Lender in writing, Lender’s exercise of any of the rights provided herein shall preclude Borrower from the pursuit and benefit thereof without any further action or proceeding of any nature.  Lender, however, shall not be obligated to make timely filings of claims in any bankruptcy, reorganization or similar action, or to otherwise pursue creditor’s rights therein.
8.Default of Borrower.  
		(a)	Remedies.  Upon the occurrence of an Event of Default, Borrower’s License to collect Rents shall upon written notice cease and terminate.  Lender shall thereupon be authorized at its option to enter and take possession of all or part of the Property, in person or by agent, employee or court appointed receiver, and to perform all acts necessary for the operation and maintenance of the Property in the same manner and to the same extent that Borrower might reasonably so act.  In furtherance thereof, Lender shall be authorized, but under no obligation, to collect the Rents arising from the Leases, and to enforce performance of any other terms of the Leases including, but not limited to, Borrower’s rights to fix or modify rents, sue for possession of the leased premises, relet all or part of the leased premises, and collect all Rents under such new Leases.  In that regard, Lender may deliver a Rent Demand to Borrower or deliver a Notice of Enforcement to Lessees.  Assignor agrees that any Rent Demand sent by Lender may be sent to Borrower pursuant to the notice provisions set forth in the Loan Agreement.  Borrower shall, within ten days after its receipt of a Rent Demand, deliver to Lender such Rents as are described in the Rent Demand.  It shall never be necessary for Lender to institute legal proceedings of any kind whatsoever to enforce any provision of this Assignment. Upon receipt from Lender of a Notice of Enforcement, each Lessee is authorized and directed to pay directly to Lender all Rents thereafter accruing, and the receipt of Rents by Lender shall be a release of such Lessee to the extent of all amounts so paid.  The receipt by a Lessee of a Notice of Enforcement shall be sufficient authorization for such Lessee to make all future payments of Rents directly to Lender and each such Lessee shall be entitled to rely on the Notice of Enforcement and shall have no liability to Borrower for any Rents paid to Lender after receipt of the Notice of Enforcement.  Further, Borrower shall also pay to Lender, promptly upon any Event of Default:  (a) all rent prepayments and security or other deposits paid to Borrower pursuant to any Lease assigned hereunder; and (b) all charges for services or facilities or for escalations which have theretofore been paid pursuant to any such Lease to the extent allocable to any period from and after such Event of Default.  Lender will, after payment of all proper costs, charges and any damages, apply the net amount of such Rents to the Obligations.  Lender shall have sole but reasonable discretion as to the manner in which such Rents are to be applied, the reasonableness of the costs to which they are applied, and the items that will be credited thereby.

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Ex 10.225

		(b)	Notice to Lessee.  Borrower hereby irrevocably authorizes each Lessee, upon demand and notice from Lender of the occurrence of an Event of Default, to pay all Rents under the Leases to Lender.  Borrower agrees that each Lessee shall have the right to rely upon any notice from Lender directing such Lessee to pay all Rents to Lender, without any obligation to inquire as to the actual existence of an Event of Default, notwithstanding any notice from or claim of Borrower to the contrary.  Borrower shall have no claim against any Lessee for any Rents paid by Lessee to Lender.

		(c)	Assignment of Defaulting Borrower’s Interest in Lease.  Lender shall have the right to assign Borrower’s right, title and interest in and to the Leases to any person acquiring title to the Property through foreclosure or otherwise.  Such Lender shall not be liable to account to Borrower for the Rents thereafter accruing.

		(d)	No Waiver.  Lender’s failure to avail itself of any of its rights under this Assignment for any period of time, or at any time or times, shall not constitute a waiver thereof.  Lender’s rights and remedies hereunder are cumulative, and not in lieu of, but in addition to, any other rights and remedies Lender has under the Loan Agreement, the Note, the Security Instrument and any of the other Loan Documents or otherwise available at law or in equity.  Lender’s rights and remedies hereunder may be exercised as often as Lender deems expedient.

		(e)	Costs and Expenses.  The cost and expenses (including any receiver’s fees and fees) incurred by Lender pursuant to the powers contained in this Assignment shall be immediately reimbursed by Borrower to Lender on demand, shall be secured hereby and, if not paid by Borrower, shall bear interest from the date demanded at the Default Rate (as defined in the Loan Agreement).  Lender shall not be liable to account to Borrower for any action taken pursuant hereto, other than to account for any Rents actually received by Lender.

9.Indemnification of Lender.  Borrower hereby agrees to indemnify, defend, protect and hold Lender harmless from and against any and all liability, loss, cost, expense or damage (including reasonable attorney fees) that Lender may or might incur under the Leases or by reason of this Assignment.  Such indemnification shall also cover any and all claims and demands that may be asserted against Lender under the Leases or this Assignment.  Nothing in this section shall be construed to bind Lender to the performance of any Lease provisions, or to otherwise impose any liability upon Lender, including, without limitation, any liability under covenants of quiet enjoyment in the Leases in the event that any Lessee shall have been joined as party defendant in any action to foreclose the Security Instrument and shall have been barred thereby of all right, title, interest, and equity of redemption in the Property.  This Assignment imposes no liability upon Lender for the operation and maintenance of the Property or for carrying out the terms of any Lease before Lender has entered and taken possession of the Property.  Any loss or liability incurred by Lender by reason of actual entry and taking possession under any Lease or this Assignment or in the defense of any claims shall, at Lender’s request, be immediately reimbursed by Borrower.  Such reimbursement shall include interest at the Default Rate provided in the Note, costs, expenses and reasonable attorney fees.  Lender may, upon entry and taking of possession, collect the Rents and apply them to reimbursement for any such loss or liability.  The provisions of this Section 9 shall survive repayment of the Obligations and any termination or satisfaction of this Assignment.
10.Additions to, Changes in and Replacement of Obligations.  Lender may take security in addition to the security already given Lender for the payment of the Obligations or release such other security, and may release any party primarily or secondarily liable on the Obligations, may grant or make extensions, renewals, modifications or indulgences with respect to the Obligations or the Security Instrument and replacements thereof, which replacements of the Obligations or the Security Instrument may be on the same terms as, or on terms different from, the present terms of the Obligations or the Security Instrument, and may apply any other security held by it to the satisfaction of the Obligations, without prejudice to any of its rights hereunder.
11.Power of Attorney.  In furtherance of the purposes of this Assignment, Borrower hereby appoints Lender as Borrower’s attorney-in-fact, with full authority in the place of Borrower, at the option of Lender 

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Ex 10.225

at any time after the occurrence of an Event of Default, and in the name of Borrower or Lender, to (a) collect, demand and receive the Rents and other amounts payable under any Lease, (b) bring suit and take other action to enforce the Leases, (c) enforce, supplement, modify, amend, renew, extend, terminate and otherwise administer the Leases and deal with Lessees in relation to the Leases, (d) give notices, receipts, releases and satisfactions with respect to the Leases and the Rents and other amounts payable under any Lease, and (e) take such other action as Lender may reasonably deem necessary or advisable in connection with the exercise of any right or remedy or any other action taken by Lender under this Assignment.
12.No Mortgagee in Possession; No Other Liability.  The acceptance by Lender of this Assignment, with all of the rights, power, privileges and authority so created, shall not, prior to entry upon and taking of possession of the Property by Lender, be deemed or construed to:  (a) constitute Lender as a mortgagee in possession nor place any responsibility upon Lender for the care, control, management or repair of the Property, nor shall it operate to make Lender responsible or liable for any waste committed on the Property by any Lessee, occupant or other party, or for any dangerous or defective condition of the Property, nor thereafter at any time or in any event obligate Lender to appear in or defend any action or proceeding relating to the Leases or to the Property; (b) require Lender to take any action hereunder, or to expend any money or incur any expenses or perform or discharge any obligation, duty or liability under the Leases; or (c) require Lender to assume any obligation or responsibility for any security deposits or other deposits delivered to Borrower by Lessees and not assigned and delivered to Lender.  Lender shall not be liable in any way for any injury or damage to person or property sustained by any person in or about the Property.
13.Termination of Assignment.  Lender shall terminate and release this Assignment as to all or a portion of the Property to the same extent as the Security Instrument is released in whole or in part.
14.Miscellaneous.  
		(a)	Severability.  If any term of this Assignment or the application hereof to any person or set of circumstances, shall to any extent be invalid or unenforceable, the remainder of this Assignment, or the application of such provision or part thereof to persons or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby, and each term of this Assignment shall be valid and enforceable to the fullest extent consistent with applicable law.

		(b)	Captions.  The captions or headings at the beginning of each section hereof are for the convenience of the parties only and are not part of this Assignment.

		(c)	Counterparts.  This Assignment may be executed in two or more counterparts, each of which shall be deemed an original, and all of which shall be construed together and shall constitute one instrument.  It shall not be necessary in making proof of this Assignment to produce or account for more than one such counterpart.

		(d)	Notices.  All notices or other written communications hereunder shall be given in the manner set forth in the Loan Agreement.

		(e)	Modification.  No amendment, modification or cancellation of this Assignment or any part hereof shall be enforceable without Lender’s prior written consent.

		(f)	Governing Law.  This Assignment shall be governed by and construed in accordance with the laws of the State of Colorado, without giving effect to conflict of laws principles.

		(g)	Successors and Assigns; Gender; Joint and Several Liability.  The terms, covenants, conditions and warranties contained herein and the powers granted hereby shall run with the land, shall inure to the benefit of and bind all parties hereto and their respective heirs, executors, administrators, successors and assigns, and all subsequent owners of the Property, and all subsequent holders of the Note and the Security Instrument, subject in all events to the provisions of the Security Instrument regarding transfers of the Property by Borrower.  In this Assignment, whenever the context so requires, the masculine gender shall include the feminine and/or neuter and the singular number shall include the plural 

​

Ex 10.225

			and conversely in each case.  If there is more than one (1) party constituting Borrower, all obligations of each Borrower hereunder shall be joint and several.

		(h)	Expenses.  Borrower shall pay on demand all costs and expenses incurred by Lender in connection with the review of Leases, including reasonable fees and expenses of Lender’s outside counsel.

15.WAIVER OF JURY TRIAL.  BORROWER AND LENDER, BY ITS ACCEPTANCE HEREOF, HEREBY VOLUNTARILY, KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE) BETWEEN OR AMONG BORROWER AND LENDER ARISING OUT OF OR IN ANY WAY RELATED TO THIS ASSIGNMENT, ANY OTHER LOAN DOCUMENT, OR ANY RELATIONSHIP BETWEEN BORROWER AND LENDER.  THIS PROVISION IS A MATERIAL INDUCEMENT TO LENDER TO PROVIDE THE LOAN DESCRIBED HEREIN AND IN THE OTHER LOAN DOCUMENTS.
16.JURISDICTION AND VENUE.  BORROWER HEREBY AGREES THAT ALL ACTIONS OR PROCEEDINGS INITIATED BY BORROWER AND ARISING DIRECTLY OR INDIRECTLY OUT OF THIS ASSIGNMENT SHALL BE LITIGATED IN THE CIRCUIT COURT OF LARIMER COUNTY, COLORADO, OR THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO OR, IF LENDER INITIATES SUCH ACTION, ANY COURT IN WHICH LENDER SHALL INITIATE SUCH ACTION AND WHICH HAS JURISDICTION.  BORROWER HEREBY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED BY LENDER IN ANY OF SUCH COURTS, AND HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO BORROWER AT THE ADDRESS TO WHICH NOTICES ARE TO BE SENT PURSUANT TO THE SECURITY INSTRUMENT.  BORROWER WAIVES ANY CLAIM THAT ANY SUCH JURISDICTION IS AN INCONVENIENT FORUM OR AN IMPROPER FORUM BASED ON LACK OF VENUE.  SHOULD BORROWER, AFTER BEING SO SERVED, FAIL TO APPEAR OR ANSWER TO ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THE NUMBER OF DAYS PRESCRIBED BY LAW AFTER THE MAILING THEREOF, BORROWER SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED BY LENDER AGAINST BORROWER AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS.  THE EXCLUSIVE CHOICE OF FORUM FOR BORROWER SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE ENFORCEMENT BY LENDER OF ANY JUDGMENT OBTAINED IN ANY OTHER FORUM OR THE TAKING BY LENDER OF ANY ACTION TO ENFORCE THE SAME IN ANY OTHER APPROPRIATE JURISDICTION, AND BORROWER HEREBY WAIVES THE RIGHT, IF ANY, TO COLLATERALLY ATTACK ANY SUCH JUDGMENT OR ACTION.
[Remainder of page INTENTIONALLY LEFT blank;
signature PAGE FOLLOWS]
​

​

Ex 10.225

IN WITNESS WHEREOF, Borrower has caused this Assignment to be duly executed as of the day and year first above written.
BORROWER:
​
LF3 RIFC, 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 Maryland corporation, its general partner
​
​
By: /s/ Samuel C. Montgomery
Name:  Samuel C. Montgomery
Title:  Chief Financial Officer
​
​
STATE OF NORTH DAKOTA)
) SS.
COUNTY OF CASS)
​
I,  Barbara Villella, the undersigned, a Notary Public in and for said County, in the State aforesaid, DO HEREBY CERTIFY that Samuel C. Montgomery, as Chief Financial Officer of Lodging Fund REIT III, Inc., a Maryland corporation and general partner of Lodging Fund REIT III OP, LP, a Delaware limited partnership and sole member of LF3 RIFC, LLC, a Delaware limited liability company, who is personally known to me to be the same person whose name is subscribed to the foregoing instrument as such Chief Financial Officer, appeared before me this day in person and acknowledged that he/she signed and delivered said instrument as his/her own free and voluntary act and as the free and voluntary act as said Chief Financial Officer on behalf of said entity.
​
GIVEN under my hand and Notarial Seal this 1 day of August, 2022.
​
/s/ Barbara Villella
(SEAL)Notary Public, State of North Dakota
My Commission Expires: _Feb 23, 2026__

​

Ex 10.225

LF3 RIFC TRS, LLC,
a Delaware limited liability company
​
By: Lodging Fund REIT III TRS, Inc.,
a Delaware corporation, its sole member
​
​
By: /s/ Samuel C. Montgomery
Name: Samuel C. Montgomery
Title: Chief Financial Officer
​
​
STATE OF NORTH DAKOTA)
) SS.
COUNTY OF CASS)
​
I,  Barbara Villella, the undersigned, a Notary Public in and for said County, in the State aforesaid, DO HEREBY CERTIFY that Samuel C. Montgomery, as Chief Financial Officer of Lodging Fund REIT III, TRS., a Delaware corporation and sole member of LF3 RIFC TRS, LLC, a Delaware limited liability company, who is personally known to me to be the same person whose name is subscribed to the foregoing instrument as such Chief Financial Officer, appeared before me this day in person and acknowledged that he/she signed and delivered said instrument as his/her own free and voluntary act and as the free and voluntary act as said Chief Financial Officer on behalf of said entity.
​
GIVEN under my hand and Notarial Seal this 1 day of August, 2022.
​
/s/ Barbara Villella
(SEAL)Notary Public, State of North Dakota
My Commission Expires: _Feb 23, 2026__
​
​
DOCUMENT PREPARED BY:
Clifton M. Dugas, II
Foley & Lardner, LLP
2021 McKinney Ave., Suite 1600
Dallas, Texas  75201
​
​
​
​

​

Ex 10.223

EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
PARCEL 1:
LOT 1, OAKRIDGE BUSINESS PARK FILING NO. 25 P.U.D. - RESIDENCE INN, CITY OF FORT COLLINS, COUNTY OF LARIMER, STATE OF COLORADO.
​
​
PARCEL 2:
LOT 4, OAKRIDGE BUSINESS PARK - BLOCK 4, CITY OF FORT COLLINS, COUNTY OF
LARIMER, STATE OF COLORADO. 
​
PARCEL 3:
NON-EXCLUSIVE EASEMENTS FOR PEDESTRIAN AND VEHICULAR INGRESS AND EGRESS, AND FOR VEHICULAR PARKING AS SET FORTH IN DECLARATION OF PROTECTIVE COVENANTS, CONDITIONS, RESTRICTIONS AND GRANTS OF EASEMENTS RECORDED FEBRUARY 22, 2000 UNDER RECEPTION NO. 2000011344.
​
​
Property Address:1127 Oakridge Drive, Fort Collins, Colorado 80525

​

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