Ashford
Loan No. 502859548
GUARANTY
(Intermediate Mezzanine Loan)
THIS GUARANTY
(“ Guaranty ”) is executed as of April 11,
2007, by ASHFORD HOSPITALITY LIMITED PARTNERSHIP and ASHFORD
HOSPITALITY TRUST INC. (hereinafter collectively referred to as
“ Guarantor ”), for the benefit of WACHOVIA
BANK, NATIONAL ASSOCIATION (“ Lender
”).
A. ASHFORD
SAPPHIRE JUNIOR MEZZ I LLC, a Delaware limited liability company
and ASHFORD SAPPHIRE JUNIOR MEZZ II LLC, a Delaware limited
liability company (collectively, “ Borrower ”)
is indebted to Lender with respect to a loan (“ Loan
”) pursuant to a certain promissory note dated of even date
herewith, payable to the order of Lender in the aggregate original
principal amount of EIGHTY MILLION AND No/100 DOLLARS
($80,000,000.00) (together with all renewals, modifications,
increases and extensions thereof, the “ Note ”),
which is secured by the liens and security interests created by
that certain Loan and Security Agreement (collectively, the “
Security Instrument ”), between Lender and Borrower,
dated of even date herewith and further evidenced, secured or
governed by the other Loan Documents (as defined in the Security
Instrument); and
B. Lender is
not willing to make the Loan, or otherwise extend credit, to
Borrower unless Guarantor unconditionally guarantees payment and
performance to Lender of the Guaranteed Obligations (as hereinafter
defined); and
C. Guarantor
is the owner of a direct or indirect interest in Borrower, and
Guarantor will directly benefit from Lender’s making the Loan
to Borrower.
NOW, THEREFORE, as
an inducement to Lender to make the Loan to Borrower thereunder,
and to extend such additional credit as Lender may from time to
time agree to extend under the Loan Documents, and for other good
and valuable consideration, the receipt and legal sufficiency of
which are hereby acknowledged, the parties do hereby agree as
follows:
ARTICLE I
NATURE AND SCOPE OF GUARANTY
Section 1.1
Guaranty of
Obligation . Guarantor hereby absolutely,
irrevocably and unconditionally guarantees to Lender (and its
successors and assigns), jointly and severally, the payment and
performance of the Guaranteed Obligations as and when the same
shall be due and payable, whether upon demand by Lender or by lapse
of time, by acceleration of maturity or otherwise. Guarantor hereby
absolutely, irrevocably and unconditionally covenants and agrees
that it is liable, jointly and severally, for the Guaranteed
Obligations as a primary obligor, and that each Guarantor shall
fully perform, jointly and severally, each and every term and
provision hereof.
Section 1.2
Definition of Guaranteed
Obligations . As used herein, the term
“ Guaranteed Obligations ” shall mean, and
Guarantor shall be liable for, and shall indemnify,
defend and hold
Lender and each other Indemnified Party harmless from and against,
any and all Losses (as hereinafter defined) incurred or suffered by
Lender or any other Indemnified Party arising out of or in
connection with the matters listed below:
(a) fraud
or intentional misrepresentation by Borrower, Guarantor or any
Affiliate of Borrower or Guarantor or the failure to state a
material fact in the written information provided to Lender by or
on behalf of Borrower or any of its Affiliates in connection with
the Security Instrument, the Note or the other Loan
Documents;
(b) the
misappropriation by Borrower, Guarantor or any Affiliate of
Borrower or Guarantor of any tenant security deposits or
Rent;
(c) the
misapplication or conversion of Loss Proceeds;
(d) any
act of arson, intentional physical damage or waste of or to the
Property by Borrower, Owner, Guarantor or any Affiliate of Borrower
or Guarantor;
(e) Borrower’s
failure to comply with the provisions of Section 4.01
of the Security Instrument or Owner’s failure to comply with
Sections 2.02(g), 12.01, 16.01, 16.02, 18.29, 18.30 or
18.31 , inclusive, of the Mortgage;
(f) the
exercise of any right or remedy under any federal, state or local
forfeiture laws resulting in the loss or impairment of the lien of
the Security Instrument, or the priority thereof, against the
Collateral;
(g) any
modification, termination or amendment to a Ground Lease which was
not consented to by Lender;
(h) any
claims, actions or proceedings initiated by Borrower (or any
Affiliate of Borrower) alleging that the relationship of Borrower
and Lender is that of joint venturers, partners, tenants in common,
joint tenants or any relationship other than that of debtor and
creditor; or
(i) any
Transfer in violation of the provisions of Section 2.11 of the
Security Instrument.
In addition, in
the event (i) any proceeding, action, petition or filing under
the Bankruptcy Code, or any similar state or federal law now or
hereafter in effect relating to bankruptcy, reorganization or
insolvency, or the arrangement or adjustment of debts of Borrower,
Owner, Operating Tenant, Senior Mez Borrower or Guarantor, shall be
filed by, consented to or acquiesced in by Borrower, Owner,
Operating Tenant, Senior Mez Borrower or Guarantor or any of their
Affiliates commences any proceeding, action, petition or filing
under the Bankruptcy Code or similar state or federal law now or
hereafter in effect relating to bankruptcy, reorganization or
insolvency, or the arrangement or adjustment of debts with respect
to Borrower, Owner, Operating Tenant, Senior Mez Borrower or
Guarantor, or if Borrower, Owner, Operating Tenant, Senior Mez
Borrower or Guarantor or any Affiliates of Borrower, Owner,
Operating Tenant, Senior Mez Borrower or Guarantor shall institute
any proceeding for Borrower’s, Owner’s, Operating
Tenant’s, Senior Mez Borrower’s or Guarantor’s
dissolution or
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liquidation, or
shall make an assignment for the benefit of creditors (provided the
Guarantor’s liability under this sentence shall in no event
exceed the Cap Amount (as set forth on Exhibit A
attached hereto)), then the Guaranteed Obligations shall also
include the unpaid balance of the Debt.
For purposes of
this Guaranty, the term “ Losses ” includes any
and all claims, suits, liabilities (including, without limitation,
strict liabilities), actions, proceedings, obligations, debts,
damages, losses, costs, expenses, diminutions in value, fines,
penalties, charges, fees, expenses, judgments, awards, amounts paid
in settlement, punitive damages, foreseeable and unforeseeable
consequential damages, of whatever kind or nature (including but
not limited to reasonable attorneys’ fees and other costs of
defense).
Section 1.3
Nature of
Guaranty .
This Guaranty is an irrevocable, absolute, continuing guaranty of
payment and performance, is joint and several and is not a guaranty
of collection. This Guaranty shall continue to be effective with
respect to any Guaranteed Obligations arising or created after any
attempted revocation by Guarantor and after (if Guarantor is a
natural Person) Guarantor’s death (in which event this
Guaranty shall be binding upon Guarantor’s estate and
Guarantor’s legal representatives and heirs). The obligations
of Guarantor under this Guaranty shall survive any foreclosure
proceeding, any foreclosure sale and delivery of any assignment in
lieu of foreclosure, and any release of record of the Security
Instrument. The fact that at any time or from time to time the
Guaranteed Obligations may be increased or reduced shall not
release or discharge the obligation of Guarantor to Lender with
respect to the Guaranteed Obligations. This Guaranty may be
enforced by Lender and any subsequent holder of the Note and shall
not be discharged by the assignment or negotiation of all or part
of the Note.
Section 1.4
Guaranteed Obligations
Not Reduced by Offset . The Guaranteed Obligations and
the liabilities and obligations of Guarantor to Lender hereunder
shall not be reduced, discharged or released because or by reason
of any existing or future offset, claim or defense of Borrower, or
any other Person, against Lender or against payment of the
Guaranteed Obligations, whether such offset, claim or defense
arises in connection with the Guaranteed Obligations (or the
transactions creating the Guaranteed Obligations) or
otherwise.
Section 1.5
Payment by
Guarantor . If all or any part of the
Guaranteed Obligations shall not be punctually paid when due,
whether at maturity or earlier by acceleration or otherwise,
Guarantor shall, immediately upon demand by Lender, and without
presentment, protest, notice of protest, notice of non-payment,
notice of intention to accelerate the maturity, notice of
acceleration of the maturity, or any other notice whatsoever, pay
in lawful money of the United States of America, the amount due on
the Guaranteed Obligations to Lender at Lender’s address as
set forth herein. Such demand(s) may be made at any time coincident
with or after the time for payment of all or part of the Guaranteed
Obligations, and may be made from time to time with respect to the
same or different items of Guaranteed Obligations. Such demand
shall be deemed made, given and received in accordance with the
notice provisions hereof.
Section 1.6
No Duty to Pursue
Others .
It shall not be necessary for Lender (and Guarantor hereby waives
any rights which Guarantor may have to require Lender), in order to
enforce this Guaranty against Guarantor, first to
(i) institute suit or exhaust its remedies against
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Borrower or
others liable on the Loan or the Guaranteed Obligations or any
other Person, (ii) enforce Lender’s rights against any
collateral which shall ever have been given to secure the Loan,
(iii) enforce Lender’s rights against any other
guarantors of the Guaranteed Obligations, (iv) join Borrower
or any others liable on the Guaranteed Obligations in any action
seeking to enforce this Guaranty, (v) exhaust any remedies
available to Lender against any collateral which shall ever have
been given to secure the Loan, or (vi) resort to any other
means of obtaining payment of the Guaranteed Obligations. Lender
shall not be required to mitigate damages or take any other action
to reduce, collect or enforce the Guaranteed
Obligations.
Section 1.7
Waivers
. Guarantor agrees to
the provisions of the Loan Documents, and hereby waives notice of
(i) any loans or advances made by Lender to Borrower, (ii)
acceptance of this Guaranty, (iii) any amendment or extension
of the Note or of any other Loan Documents, (iv) the execution
and delivery by Borrower and Lender of any other loan or credit
agreement or of Borrower’s execution and delivery of any
promissory notes or other documents arising under the Loan
Documents or in connection with the Collateral, (v) the
occurrence of any breach by Borrower or Event of Default,
(vi) Lender’s transfer or disposition of the Guaranteed
Obligations, or any part thereof, (vii) sale or foreclosure
(or posting or advertising for sale or foreclosure) of any
collateral for the Guaranteed Obligations, (viii) protest,
proof of non-payment or default by Borrower, or (ix) any other
action at any time taken or omitted by Lender, and, generally, all
demands and notices of every kind in connection with this Guaranty,
the Loan Documents, any documents or agreements evidencing,
securing or relating to any of the Guaranteed Obligations and the
obligations hereby guaranteed.
Section 1.8
Payment of
Expenses .
In the event that Guarantor should breach or fail to timely perform
any provisions of this Guaranty, Guarantor shall, immediately upon
demand by Lender, pay Lender all costs and expenses (including
court costs and reasonable attorneys’ fees) incurred by
Lender in the enforcement hereof or the preservation of
Lender’s rights hereunder. The covenant contained in this
section shall survive the payment and performance of the Guaranteed
Obligations.
Section 1.9
Effect of
Bankruptcy . In the event that, pursuant to
any insolvency, bankruptcy, reorganization, receivership or other
debtor relief law, or any judgment, order or decision thereunder,
Lender must rescind or restore any payment, or any part thereof,
received by Lender in satisfaction of the Guaranteed Obligations,
as set forth herein, any prior release or discharge from the terms
of this Guaranty given to Guarantor by Lender shall be without
effect, and this Guaranty shall remain in full force and effect. It
is the intention of Borrower and Guarantor that Guarantor’s
obligations hereunder shall not be discharged except by
Guarantor’s performance of such obligations and then only to
the extent of such performance.
Section 1.10
Deferral of Rights of
Subrogation, Reimbursement and Contribution .
(a) Notwithstanding
any payment or payments made by any Guarantor hereunder, unless and
until payment in full of the Debt (and including interest accruing
on the Note after the commencement of a proceeding by or against
Borrower under the Bankruptcy Code which interest the parties agree
shall remain a claim that is prior and superior to any claim of
Guarantor notwithstanding any contrary practice, custom or ruling
in cases under the
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Bankruptcy
Code) (i) no Guarantor will assert or exercise any right of
Lender or of such Guarantor against Borrower to recover the amount
of any payment made by such Guarantor to Lender by way of
subrogation, reimbursement, contribution, indemnity, or otherwise
arising by contract or operation of law, and such Guarantor shall
not have any right of recourse to or any claim against assets or
property of Borrower; and (ii) each Guarantor agrees not to
seek contribution or indemnity or other recourse from any other
Guarantor.
(b) Until
payment in full of the Debt (and including interest accruing on the
Note after the commencement of a proceeding by or against Borrower
under the Bankruptcy Code which interest the parties agree shall
remain a claim that is prior and superior to any claim of Guarantor
notwithstanding any contrary practice, custom or ruling in cases
under the Bankruptcy Code), Guarantor agrees not to accept any
payment or satisfaction of any kind of indebtedness of Borrower to
Guarantor and hereby assigns such indebtedness to Lender, including
the right to file proof of claim and to vote thereon in connection
with any such proceeding under the Bankruptcy Code, including the
right to vote on any plan of reorganization. If any amount of the
type more particularly described in the first sentence of this
Section 1.10(b) shall nevertheless be paid to a Guarantor by
Borrower or another Guarantor prior to payment in full of all sums
owed to Lender under the Loan Documents (the “
Obligations ”), such amount shall be held in trust for
the benefit of Lender and shall forthwith be paid to Lender to be
credited and applied to the Guaranteed Obligations, whether matured
or unmatured.
(c) The
provisions of this Section 1.10 shall survive the termination
of this Guaranty, and any s
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