Common use of PIP Clause in Contracts

PIP. (i) Each Borrower shall take all necessary action to diligently complete in a manner acceptable to the applicable Approved Franchisor the PIP Work applicable to such Borrower’s Collateral Asset as contemplated under the applicable PIP and in accordance with the applicable PIP Budget on or before the PIP Completion Date, as any of the same may have been modified or amended in accordance with Section 5.02(v); provided, however, that in the case of any PIP having a budget in excess of $15,000 per room, the Agents, Lenders and their respective agents and representatives (including the Administrative Agent’s engineer, architect or inspector) shall be entitled to enter onto any Borrower’s Collateral Asset during normal business hours upon reasonable notice (subject to the rights of guests or invitees of such Collateral Asset) to inspect the progress of any PIP Work and all materials being used in connection therewith and to examine all plans and shop drawings relating to such PIP Work. Such Borrower shall deliver to the Administrative Agent as soon as practicable following the completion of the applicable PIP Work evidence reasonably satisfactory to the Administrative Agent that the applicable Approved Franchisor has accepted the applicable PIP Work as complete. (ii) Not less than thirty (30) days prior to any Borrower’s commencement of any PIP Work related to a PIP, the applicable Borrower shall deliver to the Administrative Agent a detailed PIP Budget showing line-item detail reasonably acceptable to Administrative Agent in respect of such PIP. (iii) If the Administrative Agent receives notice from an Approved Franchisor or a Borrower that a Borrower has failed to complete the required PIP Work applicable to such Borrower’s Collateral Asset by the applicable PIP Completion Date (subject to any force majeure event and/or cure period provided for under the applicable PIP or Approved Franchise Agreement), the Administrative Agent (with the approval of the Required Lenders) may (after notice and a reasonable cure period not to exceed sixty (60) days unless the Administrative Agent reasonably determines that a shorter period is necessary to avoid any default or termination of the Approved Franchise Agreement) elect to complete such PIP Work, and the Borrowers shall reimburse the Administrative Agent and Lenders upon demand for all sums expended by the Administrative Agent in connection with such completion of the PIP Work. Any amount expended by the Administrative Agent or Lenders to complete any PIP Work shall be a Protective Advance and shall be secured by the Collateral Documents. (iv) The Borrowers shall give the Administrative Agent prompt written notice of any demand from an Approved Franchisor for an amendment to a PIP, and any demand from an Approved Franchisor for any repairs, maintenance, alterations, or improvements required to comply with an Approved Franchise Agreement. (v) During the continuance of any PIP Work on any Collateral Asset, the Borrowers shall deposit or cause to be deposited with or on behalf of the Administrative Agent (x) such amounts as the Administrative Agent from time to time reasonably determines are necessary to cover the costs of such PIP Work required by an Approved Franchisor under a PIP or any modification to a PIP or to cover PIP Work contemplated by any new property improvement plan imposed by an Approved Franchisor, and the cost of any repairs, maintenance, alterations, or improvements demanded by a Franchisor pursuant to an Approved Franchise Agreement less (y) the Unexpended FF&E PIP Funds. All such amounts shall be deposited directly by or at the direction of the Administrative Agent, into an account established with the Administrative Agent or the Servicer in the name of the Administrative Agent to hold such funds (the “PIP Reserve Account”). Amounts deposited from time to time in the PIP Reserve Account pursuant to this Section 5.01(bb)

PIP. (i) Each Borrower shall take all necessary action to diligently complete in a manner acceptable to the applicable Approved Franchisor the PIP Work applicable to such Borrower’s Collateral Asset as contemplated under the applicable The Administrative Agent hereby approves each Initial PIP and in accordance with the applicable each PIP Budget set forth on or before Schedule X. No Borrower shall, without the PIP Completion Date, as any prior written approval of the same may have been modified Administrative Agent, adopt, modify or amended amend in accordance with Section 5.02(v)any material respect any PIP or any PIP Budget; provided, however, that (i) any PIP Budget that is part of a replacement Approved Franchise Agreement or adopted in connection with a replacement Approved Franchise Agreement shall be approved or disapproved by the Administrative Agent within five (5) Business Days after a written request for approval by the Borrowers and if the Administrative Agent does not respond within such five (5) Business Day period its approval shall be deemed given, or (ii) any modification or amendment to any PIP or any PIP Budget accepted by the applicable Approved Franchisor shall be deemed approved by the Administrative Agent so long as (A) no Event of Default shall have occurred and be continuing, (B) such modification or amendment shall not serve to increase any PIP Budget by more than ten percent (10%) in the case of aggregate or accelerate any PIP having a budget in excess of $15,000 per room, the Agents, Lenders and their respective agents and representatives Completion Date by more than ninety (including 90) days without the Administrative Agent’s engineerapproval; provided further that (x) if, architect or inspector) shall be entitled following any such acceleration to enter onto any Borrower’s Collateral Asset during normal business hours upon reasonable notice (subject to the rights of guests or invitees of such Collateral Asset) to inspect the progress of any PIP Work and all materials being used in connection therewith and to examine all plans and shop drawings relating to Completion Date, such PIP Work. Such Borrower shall deliver to Completion Date is not at least ninety (90) days after the Administrative Agent as soon as practicable following the completion of proposed commencement date for the applicable PIP Work evidence reasonably satisfactory to the Administrative Agent that the applicable Approved Franchisor has accepted the applicable PIP Work as complete. (ii) Not less than thirty (30) days prior to any Borrower’s commencement of any PIP Work related to a PIPset forth in Schedule X, the applicable Borrower shall deliver to accelerate such commencement date by the Administrative Agent a detailed PIP Budget showing line-item detail reasonably acceptable to Administrative Agent in respect same number of such PIP. (iii) If the Administrative Agent receives notice from an Approved Franchisor or a Borrower that a Borrower has failed to complete the required PIP Work applicable to such Borrower’s Collateral Asset days by which the applicable PIP Completion Date was accelerated and (subject y) after taking into account any changes to any force majeure event and/or cure period provided for under such completion date, the applicable Borrower shall be in compliance with the funding requirements for the PIP or Approved Franchise AgreementReserve Funds set forth in Section 5.01(bb)(v), the Administrative Agent and (with the approval of the Required LendersC) may (after notice and a reasonable cure period not to exceed sixty (60) days unless the Administrative Agent reasonably determines that a shorter period is necessary to avoid any default or termination of the Approved Franchise Agreement) elect to complete such PIP Workin all cases, and the Borrowers shall reimburse the Administrative Agent and Lenders upon demand for all sums expended by the Administrative Agent in connection with such completion of the PIP Work. Any amount expended by the Administrative Agent or Lenders to complete any PIP Work shall be a Protective Advance and shall be secured by the Collateral Documents. (iv) The Borrowers shall give the Administrative Agent provide prompt written notice of any demand from an Approved Franchisor for an amendment to a PIP, and any demand from an Approved Franchisor for any repairs, maintenance, alterations, all such modifications or improvements required to comply with an Approved Franchise Agreementamendments. (v) During the continuance of any PIP Work on any Collateral Asset, the Borrowers shall deposit or cause to be deposited with or on behalf of the Administrative Agent (x) such amounts as the Administrative Agent from time to time reasonably determines are necessary to cover the costs of such PIP Work required by an Approved Franchisor under a PIP or any modification to a PIP or to cover PIP Work contemplated by any new property improvement plan imposed by an Approved Franchisor, and the cost of any repairs, maintenance, alterations, or improvements demanded by a Franchisor pursuant to an Approved Franchise Agreement less (y) the Unexpended FF&E PIP Funds. All such amounts shall be deposited directly by or at the direction of the Administrative Agent, into an account established with the Administrative Agent or the Servicer in the name of the Administrative Agent to hold such funds (the “PIP Reserve Account”). Amounts deposited from time to time in the PIP Reserve Account pursuant to this Section 5.01(bb)

PIP. (i) Each Borrower shall take all necessary action to diligently complete in a manner acceptable to the applicable Approved Franchisor the PIP Work applicable to such Borrower’s Collateral Asset as contemplated under the applicable PIP and in accordance with the applicable PIP Budget on or before the PIP Completion Date, as any of the same may have been modified or amended in accordance with Section 5.02(v); provided, however, that in the case of any PIP having a budget in excess of $15,000 per room, the AgentsAdministrative Agent, the Lenders and their respective agents and representatives (including the Administrative Agent’s engineer, architect or inspector) shall be entitled to enter onto any Borrower’s Collateral Asset during normal business hours upon reasonable notice (subject to the rights of guests or invitees of such Collateral Asset) to inspect the progress of any PIP Work and all materials being used in connection therewith and to examine all plans and shop drawings relating to such PIP Work. Such Borrower shall deliver to the Administrative Agent as soon as practicable following the completion of the applicable PIP Work evidence reasonably satisfactory to the Administrative Agent that the applicable Approved Franchisor has accepted the applicable PIP Work as complete. (ii) Not less than thirty (30) days prior to any Borrower’s commencement of any PIP Work related to a PIP, the applicable Borrower shall deliver to the Administrative Agent a detailed PIP Budget showing line-item detail reasonably acceptable to Administrative Agent in respect of such PIP. (iii) If the Administrative Agent receives notice from an Approved Franchisor or a Borrower that a Borrower has failed to complete the required PIP Work applicable to such Borrower’s Collateral Asset by the applicable PIP Completion Date (subject to any force majeure event and/or cure period provided for under the applicable PIP or Approved Franchise Agreement), the Administrative Agent (with the approval of the Required Lenders) may (after notice and a reasonable cure period not to exceed sixty (60) days unless the Administrative Agent reasonably determines that a shorter period is necessary to avoid any default or termination of the Approved Franchise Agreement) elect to complete such PIP Work, and the Borrowers shall reimburse the Administrative Agent and the Lenders upon demand for all sums expended by the Administrative Agent in connection with such completion of the PIP Work. Any amount expended by the Administrative Agent or the Lenders to complete any PIP Work shall be a Protective Advance and shall be secured by the Collateral Documents. (iv) The Borrowers shall give the Administrative Agent prompt written notice of any demand from an Approved Franchisor for an amendment to a PIP, and any demand from an Approved Franchisor for any repairs, maintenance, alterations, or improvements required to comply with an Approved Franchise Agreement. (vA) During The Borrowers shall deposit or cause to be deposited with or on behalf of the continuance of any Administrative Agent the PIP Work on any Collateral Asset, Reserve Funds (as defined below) at the times and in the amounts specified in this Section 5.01(aa)(v); and (B) the Borrowers shall deposit or cause to be deposited with or on behalf of the Administrative Agent (x) such additional amounts as the Administrative Agent from time to time reasonably determines are is necessary to cover any increases in a PIP Budget by more than ten percent (10%) in the costs of such aggregate, any additional PIP Work required by an Approved Franchisor under a PIP or any modification to a PIP or to cover PIP Work contemplated by any new property improvement plan imposed by an Approved Franchisor, and the cost of any repairs, maintenance, alterations, or improvements demanded by a Franchisor pursuant to an Approved Franchise Agreement less (y) the Unexpended FF&E PIP FundsAgreement. All such amounts shall be deposited directly by or at the direction of the Administrative Agent, into an account established with the Administrative Agent or the Servicer in the name of the Administrative Agent to hold such funds (the “PIP Reserve Account”). Amounts deposited from time to time in the PIP Reserve Account pursuant to this Section 5.01(bb5.01(aa)(v) are referred to herein as the “PIP Reserve Funds” and shall be disbursed to fund PIP Work at the Assets from time to time in accordance with and subject to the PIP and the terms and provisions of Section 5.01(aa)(vi). The applicable Borrower shall deposit into the PIP Reserve Account (x) at least fifty percent (50%) of the aggregate projected cost of the PIP Work for each Asset (in respect of each Asset, the first fifty percent (50%) of such projected cost being the “First 50% of PIP Reserve Funds”) no later than ninety (90) days prior to the commencement date for the applicable PIP Work set forth in Schedule X and (y) the balance of the aggregate projected cost of the PIP Work in respect of such Asset on or prior to the commencement date for the applicable PIP Work set forth in Schedule X. If any PIP Budget increases by less than ten percent (10%) such that the applicable Borrower is not obligated to deposit additional funds into the PIP Reserve Account, the applicable Borrower shall fund from equity any amounts required to complete the applicable PIP Work to the extent that the PIP Reserve Funds are not sufficient to pay for the same and the applicable Borrower shall use any such equity to pay costs of the applicable PIP Work prior to requesting or using any PIP Reserve Funds. (vi) The Administrative Agent shall disburse the PIP Reserve Funds to Borrowers out of the PIP Reserve Account, provided that (A) such disbursement is for PIP Work contemplated by the applicable PIP; (B) the applicable Borrower for whom such disbursement is made shall have submitted to the Administrative Agent a request for payment at least ten (10) days prior to the date on which such Borrower has requested such payment be made, which request specifies the applicable PIP Work to be paid, (C) on the date such request is received by the Administrative Agent and on the date such payment is to be made, no Event of Default shall have occurred and be continuing, (D) the Administrative Agent shall have received an Officer’s Certificate from such Borrower (1) stating that all PIP Work to be funded by the requested disbursement have been completed in a good and workmanlike manner and in accordance with all applicable Legal Requirements, (2) stating that such disbursement is for PIP Work contemplated by the applicable PIP and has been completed in accordance therewith, (3) identifying each Person that supplied materials or labor in connection with the PIP Work to be funded by the requested disbursement, (4) stating that each such Person has been paid in full or will be paid in full upon such disbursement, (5) stating that the PIP Work to be funded has not been the subject of a previous disbursement of PIP Reserve Funds, (6) stating that all previous disbursements of PIP Reserve Funds have been used to pay the previously identified PIP Work, and (7) stating that all outstanding trade payables (other than those to be paid from the requested disbursement or those constituting Indebtedness permitted pursuant to Section 5.02(a)) have been paid in full, (E) the Administrative Agent shall have received a copy of any license, permit or other approval by any Governmental Authority required in connection with the PIP Work, and not previously delivered to the Administrative Agent, (F) the Administrative Agent shall have received conditional lien waivers or other evidence of payment satisfactory to the Administrative Agent, (G) the Administrative Agent shall have received, at the Administrative Agent’s option, a title search for the Asset indicating that the Asset is free from all Liens, claims and other encumbrances not previously approved by the Administrative Agent, (H) the Administrative Agent shall have received, at the Administrative Agent’s option, if the cost of the PIP Work exceeds $25,000, a report satisfactory to the Administrative Agent in its reasonable discretion from an architect or engineer approved by the Administrative Agent in respect of such architect or engineer’s inspection of the PIP Work, (I) the Administrative Agent shall have received such other evidence as the Administrative Agent shall reasonably request to demonstrate that the PIP Work to be funded by the requested disbursement has been completed and are paid for or will be paid upon such disbursement to Borrower, (J) the Administrative Agent shall not be required to disburse PIP Reserve Funds more frequently than once each calendar month; (K) each disbursement of PIP Reserve Funds must be in an amount not less than $25,000 (or a lesser amount if the total amount of PIP Reserve Funds is less than $25,000, in which case only one disbursement of the amount remaining in the PIP Reserve Account shall be made); and (L) each request for PIP Reserve Funds to be disbursed to Borrowers shall include a statement as to which PIP Budget line items are to be funded and what portion of the applicable PIP Budget remains unfunded. (vii) Nothing in this Section 5.01(aa) shall (A) make the Administrative Agent or the Lenders responsible for performing or completing any PIP Work; (B) require the Administrative Agent or the Lenders to expend funds in addition to the PIP Reserve Funds to complete any PIP Work; (C) obligate the Administrative Agent or the Lenders to proceed with any PIP Work; or (D) obligate the Administrative Agent or the Lenders to demand from the Borrowers additional sums to complete any PIP Work. Each Borrower shall cause all applicable contractors and subcontractors to cooperate with the Administrative Agent, each Lender or the Administrative Agent’s or any Lender’s agents or representatives described above in connection with inspections described in this Section 5.01(aa)(vi). (viii) In addition to any insurance required under the Loan Documents, each Borrower shall provide or cause to be provided workmen’s compensation insurance, builder’s risk insurance, public liability insurance and other insurance to the extent required under applicable law in connection with the PIP Work to such Borrower’s Asset. All such policies shall be in form and amount satisfactory to the Administrative Agent.