Common use of Performance Test Clause in Contracts

Performance Test. Owner shall have the right to terminate this Agreement, without payment of any termination fee, but subject to Operator’s Cure Right and the other conditions for termination in this Section 16.5, if for any two consecutive Operating Years beginning with the third and fourth Full Operating Years following Owners completion of the Renovation Plan (each such two-year period, a “Testing Period”), each of the following occurs in both of such Operating Years: (a) the GOP achieved by the Hotel for each Operating Year is less than 85% of the GOP set forth in the Operating Plan for such Operating Year, and (b) the RevPAR Index for the Hotel for each of such Operating Years is less than 83% of the RevPAR Index for the Competitive Set for each respective Operating Year (collectively, the “Performance Test”). For the avoidance of doubt, the calculation of “GOP” for purposes of clause (a) of the Performance Test excludes Third-Party Operated Area Net Income. If no Operating Plan has been approved by the Parties for any Operating Year, Operator shall be deemed to have achieved the Performance Test for such Operating Year. If the Performance Test is not achieved for any Testing Period, then Owner may exercise its right to terminate this Agreement by delivering a notice of termination to Operator given within 60 days after receipt by Owner of the Annual Financial Statements for the second Operating Year in such Testing Period in which the Performance Test is not achieved, specifying a termination date not less than 60 days nor more than 90 days after the delivery of such notice. Notwithstanding the foregoing, Owner’s right of termination under this Section 16.5.1 shall not be exercisable if the applicable level of GOP or the applicable relative RevPAR Index is not achieved as a result of: (i) a Force Majeure, (ii) an Operating Standard Deficiency, (iii) a breach by Owner of its obligations under this Agreement (including a failure of Owner to provide sufficient funds as required under this Agreement), or (iv) the impact of significant capital improvement programs at the Hotel or any of the hotels in the Competitive Set. Operator shall bear the burden of proof in establishing that the applicable level of GOP or the applicable relative REVPAR Index was not achieved as the result of any of the matters described in the preceding sentence (other than a matter constituting an Event of Default by Owner). Owner expressly acknowledges that Operator’s failure to achieve the Performance Test itself shall not constitute an Event of Default or otherwise result in any liability to Operator or any Affiliate.

Performance Test. (a) Owner shall have the right to terminate this Agreement, without payment of any termination fee, but subject to OperatorManager’s Cure Right and the other conditions for termination in this Section 16.516.4, if for any two (2) consecutive Operating Fiscal Years beginning after the third Full Fiscal Year (i.e., commencing with the third fourth and fourth fifth Full Operating Years following Owners completion of the Renovation Plan Fiscal Years) (each such two-year period, a “Testing Period”), each of the following occurs in both of such Operating Years: (a) the GOP achieved by the Hotel for each Managed Facilities do not achieve seventy (70%) of forecasted Gross Operating Year is less than 85% of the GOP Profits set forth in the Operating Business Plan for each such Operating Year, and (b) the RevPAR Index for the Hotel for each of such Operating Years is less than 83% of the RevPAR Index for the Competitive Set for each respective Operating Fiscal Year (collectively, the “Performance Test”). For the avoidance of doubt, the calculation of “GOP” for purposes of clause (a) of the Performance Test excludes Third-Party Operated Area Net Income. If no Operating Plan has been approved by the Parties for any Operating Year, Operator shall be deemed to have achieved the Performance Test for such Operating Year. If the Performance Test is not achieved for any Testing Period, then Owner may exercise its right to terminate this Agreement by delivering a notice of termination to Operator Manager given within 60 sixty (60) days after receipt by Owner of the Annual Financial Statements Operating Statement for the second Operating third Fiscal Year in such Testing Period in which the Performance Test is not achievedPeriod, specifying a termination date not less than 60 days sixty (60) nor more than 90 ninety (90) days after the delivery of such notice. . (b) Notwithstanding the foregoing, Owner’s right of termination under this Section 16.5.1 16.4 shall not be exercisable if the applicable level of GOP or the applicable relative RevPAR Index Performance Test is not achieved as a result offailed due to: (i) a Force Majeure, an Extraordinary Event; (ii) an Operating Standard Deficiency, (iii) a breach by Owner of its obligations under this Agreement (including a failure of Owner to provide sufficient funds as required under this AgreementAgreement or to maintain the Managed Facilities in accordance with the Standards), or ; (iii) any major renovation of the Managed Facilities performed at Owner’s request and not included in the Business Plan (due to the timeliness of Owner’s request); (iv) the impact of significant a reduction in available room nights resulting from a capital improvement programs program performed at the Hotel or any of the hotels Owner’s request and not included in the Competitive Set. Operator shall bear Business Plan (due to the burden timeliness of proof Owner’s request); (v) a Casualty; (vi) a Condemnation; or, (vii) a lower inventory of Hotel Guest Rooms or lower quantity of Gaming Activities than the inventory or quantity projected in establishing that the applicable level of GOP or Business Plan if such reduction is caused by the applicable relative REVPAR Index was not achieved as the result action of any of the matters described in the preceding sentence (other than a matter constituting an Event of Default by applicable Governmental Authority and not at Owner)’s request. Owner expressly acknowledges that OperatorManager’s failure to achieve the Performance Test itself shall not constitute an Event of Default or otherwise result in any liability to Operator Manager or any Affiliate.

Performance Test. Owner shall have If, in any complete Fiscal Year during the right to terminate this AgreementTerm, without payment of any termination fee, but subject to Operator’s Cure Right and the other conditions for termination in this Section 16.5, if for any two consecutive Operating Years beginning starting with the third and fourth Full Operating Years following Owners completion of second (2nd) complete Fiscal Year after the Renovation Plan (each such two-year periodOpening Date, a “Testing Period”), each of the following occurs in both of such Operating Years: (a) the GOP achieved by RevPAR (as defined herein) for the Hotel for each Operating such Fiscal Year (as determined by data from ▇▇▇▇▇ Travel Reports for a competitive set of hotels mutually agreed upon by Operator and Owner from time to time (the “Competitive Set”), provided that the parties agree that the Competitive Set as of the Commencement Date is set forth on Exhibit B attached hereto) shall be less than or equal to eighty-five percent (85% %) of the GOP set forth composite average of the RevPAR for the hotels in the Operating Plan Competitive Set for such Operating Fiscal Year, and (b) the RevPAR Index Gross Operating Profit (as defined herein) for the Hotel for each of such Operating Years Fiscal Year is less than 83% or equal to ninety percent (90%) of the Gross Operating Profit set forth in the approved Operating Budget for such Fiscal Year, then, upon payment in full of all amounts then due and owing by Owner to Operator and the performance in full of all of Owner’s obligations to Operator under this Agreement, Owner may terminate this Agreement upon at least sixty (60) days written notice given to Operator at any time after Owner’s receipt of RevPAR Index index data for the Competitive Set for each respective Operating such complete Fiscal Year (items (a) and (b) above, collectively, the “Performance Test”). For the avoidance of doubt, the calculation of “GOP” for purposes of clause (a) of the The Performance Test excludes Third-Party Operated Area Net Income. If no Operating Plan has been approved by the Parties shall be equitably adjusted for any Operating Year, Operator shall be deemed to have achieved the Performance Test for such Operating Year. If the Performance Test is not achieved for any Testing Period, then Owner may exercise its right to terminate this Agreement by delivering a notice of termination to Operator given within 60 days after receipt by Owner of the Annual Financial Statements for the second Operating Year in such Testing Period period in which the Performance Test is not achieved, specifying a termination date not less than 60 days nor more than 90 days after Hotel has been closed due to renovations or casualty and the delivery twelve (12) months following such renovation or completion of material repairs due to such noticecasualty. Notwithstanding the foregoing, if Owner elects to terminate this Agreement during the Initial Term pursuant to this Section 14.1, Operator may elect, by written notice given to Owner within thirty (30) days after the receipt of Owner’s termination notice, to make an advance (the “Cure Payment”) to Owner in an amount equal to the amount by which Gross Operating Profit for such Fiscal Year is less than ninety percent (90%) of the Gross Operating Profit set forth in the Operating Budget for such Fiscal Year; provided, however Operator’s right to make a Cure Payment and avoid a termination of termination under this Agreement by Owner pursuant to this Section 16.5.1 14.1 shall not be exercisable if limited to one (1) time during the applicable level of GOP or Initial Term. If Operator makes the applicable relative RevPAR Index is not achieved as a result of: Cure Payment within thirty (i30) a Force Majeuredays after Operator receives the foregoing termination notice from Owner, (ii) an Operating Standard Deficiency, (iii) a breach by Owner of its obligations under then this Agreement (including a failure of Owner shall remain in full force and effect notwithstanding Owner’s election to provide sufficient funds as required under this Agreement), or (iv) the impact of significant capital improvement programs at the Hotel or any of the hotels in the Competitive Setterminate. Operator shall bear the burden of proof in establishing that the applicable level of GOP or the applicable relative REVPAR Index was not achieved as the result of any of the matters described in the preceding sentence (other than a matter constituting an Event of Default by Owner). Owner expressly acknowledges that Operator’s failure to achieve the Performance Test itself shall not constitute an Event of Default or otherwise result in any liability to Operator or any Affiliate.“