Exhibit 10.2
G UARANTY AND C ONTRIBUTION A GREEMENT
This Guaranty and Contribution
Agreement (this “Agreement” ) is made and
entered into effective for all purposes as of the 9
th
day of June, 2005, by
the parties signatory hereto or to an Accession Agreement (as
hereinafter defined) (collectively, the
“Guarantor” whether one or more) to and for the
benefit of B ANK OF M ONTREAL , C HICAGO B RANCH , as Administrative Agent (the
“Administrative Agent” ), B ANK OF A MERICA , N.A., as Syndication Agent (the
“Syndication Agent” ), H ARRIS N ESBITT C ORP ., as Co-Arranger and Co-Book
Manager (the “First Arranger” ), and B
ANC OF A MERICA S ECURITIES I NC ., as Co-Arranger and Co-Book
Manager (the “Second Arranger” ) and the banks
and other lenders named in the Credit Agreement herein
described.
I NTRODUCTION
W HEREAS ,
L A S ALLE H OTEL O PERATING P ARTNERSHIP , L.P., a Delaware limited partnership (the
“Borrower” ), the Administrative Agent,
Syndication Agent, and the banks and other lenders party thereto
(collectively the “Banks” ) have entered into
that certain Amended and Restated Senior Unsecured Credit Agreement
dated as of June 9, 2005 (such Amended and Restated Senior
Unsecured Credit Agreement, as the same may be amended or modified
from time to time, including further amendments and restatements
thereof in its entirety, being hereinafter referred to as the
“Credit Agreement” ), which amends and restates
that Senior Unsecured Credit Agreement dated as of November 20,
2003, by and among the Borrower, the Administrative Agent, Fleet
National Bank, as Syndication Agent, and the banks and other
lenders party thereto (the “Original Credit
Agreement” );
W HEREAS ,
pursuant to the Credit Agreement the Banks have agreed to extend
credit to Borrower as more specifically described
therein;
W HEREAS ,
the Borrower is the principal financing entity for capital
requirements of its Subsidiaries, and from time to time the
Borrower has made and will continue to make capital contributions
and advances to its Subsidiaries, including the Subsidiaries which
are or will become parties hereto. Other than the Parent, each
Guarantor is a direct or indirect subsidiary of the Borrower. Each
Guarantor will derive substantial direct and indirect benefit from
the transactions contemplated by the Credit Agreement;
and
W HEREAS , as
a condition to amending and restating the Original Credit Agreement
and extending credit to the Borrower under the Credit Agreement,
the Banks have required, among other things, that the Guarantor
execute and deliver this Agreement.
A GREEMENT
N OW ,
T HEREFORE , in order to induce the Banks to make the
Advances and the Issuing Bank to issue its Letters of Credit, each
Guarantor hereby agrees as follows:
S ECTION 1.
D EFINED T ERMS .
All terms used in this Agreement, but not
defined herein, shall have the meaning given such terms in the
Credit Agreement.
S ECTION 2.
G UARANTY .
Each Guarantor hereby
unconditionally and irrevocably guarantees the punctual payment
when due, whether at stated maturity, by acceleration or otherwise,
of all obligations of the Borrower now or hereafter existing under
the Credit Agreement, the Notes and any other Credit Document,
whether for principal, interest, fees, expenses, or otherwise (such
obligations being the “Guaranteed Obligations” )
and any and all expenses (including reasonable counsel fees and
expenses) incurred by the Administrative Agent, the Syndication
Agent, the First Arranger, the Second Arranger, or any Bank in
enforcing any rights under this Agreement. Each Guarantor agrees
that its guaranty obligation under this Agreement is a guarantee of
payment, not of collection and that such Guarantor is primarily
liable for the payment of the Guaranteed Obligations.
S ECTION 3.
L IMIT OF L
IABILITY .
Each Guarantor that is a Subsidiary
of the Borrower shall be liable under this Agreement with respect
to the Guaranteed Obligations only for amounts aggregating up to
the largest amount that would not render its guaranty obligation
hereunder subject to avoidance under Section 548 of the United
States Bankruptcy Code or any comparable provisions of any state
law.
S ECTION 4.
G UARANTY A BSOLUTE .
Each Guarantor guarantees that the
Guaranteed Obligations will be paid and performed strictly in
accordance with the terms of the Credit Agreement, the other Credit
Documents and the Participating Leases, as applicable, regardless
of any law, regulation, or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of the
Administrative Agent, the Syndication Agent, the First Arranger,
the Second Arranger, the Banks or the Participating Lessees with
respect thereto. The liability of each Guarantor under this
Agreement shall be absolute and unconditional irrespective
of:
(a) any lack of validity or
enforceability of the Credit Agreement, any other Credit Document,
any Participating Lease or any other agreement or instrument
relating thereto;
(b) any change in the time, manner,
or place of payment of, or in any other term of, any of the
Guaranteed Obligations, or any other amendment or waiver of or any
consent to departure from the Credit Agreement, any Credit Document
or any Participating Lease;
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(c) any exchange, release, or
nonperfection of any collateral, if applicable, or any release or
amendment or waiver of or consent to departure from any other
agreement or guaranty, for any of the Guaranteed Obligations;
or
(d) any other circumstances which
might otherwise constitute a defense available to, or a discharge
of the Borrower or a Guarantor.
S ECTION 5.
C ONTINUATION
AND R EINSTATEMENT , E TC .
Each Guarantor agrees that, to the
extent that the Borrower makes payments to the Administrative
Agent, the Syndication Agent, the First Arranger, the Second
Arranger or any Bank or the Administrative Agent, the Syndication
Agent, the First Arranger, the Second Arranger or any Bank receives
any proceeds of any property of Borrower or any Guarantor and such
payments or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside,
or otherwise required to be repaid, then to the extent of such
repayment the Guaranteed Obligations shall be reinstated and
continued in full force and effect as of the date such initial
payment or collection of proceeds occurred. The Guarantor shall
defend and indemnify the Administrative Agent, the Syndication
Agent, the First Arranger, Second Arranger and each Bank from and
against any claim or loss under this Section 5 (including
reasonable attorneys’ fees and expenses) in the defense of
any such action or suit.
S ECTION 6.
C ERTAIN W AIVERS .
Section 6.01. Notice.
Each Guarantor hereby waives
promptness, diligence, notice of acceptance, notice of
acceleration, notice of intent to accelerate and any other notice
with respect to any of the Guaranteed Obligations and this
Agreement.
Section 6.02. Other
Remedies. Each Guarantor
hereby waives any requirement that the Administrative Agent, the
Syndication Agent, the First Arranger, the Second Arranger or any
Bank protect, secure, perfect, or insure any Lien or any Property
subject thereto or exhaust any right or take any action against the
Borrower or any other Person or any collateral, if any, including
any action required pursuant to a Legal Requirement.
Section 6.03. Waiver of
Subrogation.
(a) Each Guarantor hereby
irrevocably waives, until payment in full of all Guaranteed
Obligations and termination of all Commitments, any claim or other
rights which it may acquire against the Borrower that arise from
such Guarantor’s obligations under this Agreement or any
other Credit Document, including, without limitation, any right of
subrogation (including, without limitation, any statutory rights of
subrogation under Section 509 of the Bankruptcy Code, 11 U.S.C.
§509, or otherwise), reimbursement, exoneration, contribution,
indemnification, or any right to participate in any claim or remedy
of the Administrative Agent, the Syndication Agent, the First
Arranger, Second Arranger or any Bank against the Borrower or any
collateral which the Administrative Agent, the Syndication Agent,
the First Arranger, Second Arranger or any Bank now has or
acquires. If any amount shall be paid to any Guarantor in violation
of the
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preceding sentence and the Guaranteed
Obligations shall not have been paid in full and all of the
Commitments terminated, such amount shall be held in trust for the
benefit of the Administrative Agent, the Syndication Agent, the
First Arranger, Second Arranger or any Bank and shall promptly be
paid to the Administrative Agent for the benefit of Administrative
Agent, the Syndication Agent, the First Arranger, Second Arranger
and the Banks to be applied to the Guaranteed Obligations, whether
matured or unmatured, as the Administrative Agent may elect. Each
Guarantor acknowledges that it will receive direct and indirect
benefits from the financing arrangements contemplated by the Credit
Agreement and that the waiver set forth in this Section 6.03(a) is
knowingly made in contemplation of such benefits.
(b) Each Guarantor further agrees
that it will not enter into any agreement providing, directly or
indirectly, for any contribution, reimbursement, repayment, or
indemnity by the Borrower or any other Person on account of any
payment by such Guarantor to the Administrative Agent, the
Syndication Agent, the First Arranger, Second Arranger or the Banks
under this Agreement.
S ECTION 7.
R EPRESENTATIONS
AND W ARRANTIES .
Each Guarantor hereby represents and
warrants as follows:
Section 7.01.
Corporate Authority. Such Guarantor
is either a corporation, limited liability company, limited
partnership or trust duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization.
The execution, delivery and performance by such Guarantor of this
Agreement are within such Guarantor’s organizational powers,
have been duly authorized by all necessary organizational action
and do not contravene (a) such Guarantor’s organizational
authority or (b) any law or material contractual restriction
affecting such Guarantor or its Property.
Section 7.02. Government
Approval . No
authorization or approval or other action by and no notice to or
filing with, any Governmental Authority is required for the due
execution, delivery and performance by such Guarantor of this
Agreement.
Section 7.03. Binding
Obligations . This
Agreement is the legal, valid and binding obligation of such
Guarantor enforceable against such Guarantor in accordance with its
terms subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium, or similar law affecting
creditors’ rights (whether considered in a proceeding at law
or in equity).
S ECTION 8.
C OVENANTS .
Each Guarantor will comply with all
covenant provisions of Article V and Article VI of the Credit
Agreement to the extent such provisions are applicable.
Section 8.01. Additional
Covenant . As soon as
possible and in any event within five days after the incurrence of
any Indebtedness by the Parent or any Subsidiary of the Parent
other than the Obligations or any other Indebtedness permitted
under the Credit Agreement, the Parent shall notify the
Administrative Agent in writing of such incurrence.
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S ECTION 9.
C ONTRIBUTION
.
As a result of the transactions
contemplated by the Credit Agreement, each of the Guarantors will
benefit, directly and indirectly, from the Guaranteed Obligations
and in consideration thereof desire to enter into a contribution
agreement among themselves as set forth in this Section 9 to
allocate such benefits among themselves and to provide a fair and
equitable arrangement to make contributions in the event any
payment is made by any Guarantor hereunder to the Administrative
Agent, the Syndication Agent, the First Arranger, Second Arranger
or the Banks (such payment being referred to herein as a
“Contribution,” and for purposes of this Agreement,
includes any exercise of recourse by the Administrative Agent
against any Property of a Guarantor and application of proceeds of
such Property in satisfaction of such Guarantor’s obligations
under this Agreement). The Guarantors hereby agree as
follows:
Section 9.01. Calculation of
Contribution . In order
to provide for just and equitable contribution among the Guarantors
in the event any Contribution is made by a Guarantor (a
“Funding Guarantor” ), such Funding Guarantor
shall be entitled to a contribution from certain other Guarantors
for all payments, damages and expenses incurred by that Funding
Guarantor in discharging any of the Guaranteed Obligations, in the
manner and to the extent set forth in this Section. The amount of
any Contribution under this Agreement shall be equal to the payment
made by the Funding Guarantor to the Administrative Agent or any
other beneficiary pursuant to this Agreement and shall be
determined as of the date on which such payment is made.
Section 9.02. Benefit Amount
Defined . For purposes of
this Agreement, the “Benefit Amount” of any Guarantor
as of any date of determination shall be the net value of the
benefits to such Guarantor
