Exhibit 10.13
CONTRIBUTION AGREEMENT
BY AND AMONG
BCC VIRGINIA BEACH LLC,
a Delaware limited liability company,
as the Contributor,
BARCELO CRESTLINE CORPORATION,
a Maryland corporation
AND
HIGHLAND HOSPITALITY, L.P.,
a Delaware limited partnership,
as the Acquirer
TABLE OF CONTENTS
Page
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ARTICLE I The Contribution....................................................1
1.1 Contribution of Contributed Assets.....................................1
1.2 Consideration..........................................................1
1.3 Post-Closing Escrow....................................................2
1.4 Redemption Rights for Units............................................3
1.5 Tax Consequences to Contributor........................................3
ARTICLE II Representations and Covenants......................................3
2.1 Representations by Acquirer............................................3
2.2 Representations by Contributor and BCC.................................5
2.3 Satisfaction of Conditions............................................11
2.4 Contributor's and BCC's Indemnity.....................................11
2.5 Acquirer's Indemnity..................................................11
ARTICLE III Conditions Precedent to the Closing..............................12
3.1 Conditions to Acquirer's Obligations..................................12
3.2 Conditions to Contributor's Obligations...............................13
ARTICLE IV Closing and Closing Documents.....................................13
4.1 Closing...............................................................13
4.2 Contributor's Deliveries..............................................14
4.3 Acquirer's Deliveries.................................................14
4.4 Fees and Expenses; Closing Costs......................................15
4.5 Default Remedies......................................................15
ARTICLE V Miscellaneous......................................................15
5.1 Notices...............................................................15
5.2 Entire Agreement; Modifications and Waivers; Cumulative Remedies......16
5.3 Exhibits..............................................................16
5.4 Successors and Assigns................................................16
5.5 Article Headings......................................................17
5.6 Governing Law.........................................................17
5.7 Counterparts..........................................................17
5.8 Survival..............................................................17
5.9 Further Acts..........................................................17
5.10 Severability.........................................................17
5.11 Attorneys' Fees......................................................17
5.12 Confidentiality......................................................17
EXHIBITS
A Assignment
B Partnership Agreement
CONTRIBUTION AGREEMENT
THIS CONTRIBUTION AGREEMENT (this "Agreement") is made as of the 4th day of
September, 2003 by and among BCC VIRGINIA BEACH LLC, a Delaware limited
liability company (the "Contributor"); BARCELO CRESTLINE CORPORATION, a Maryland
corporation ("BCC"); and HIGHLAND HOSPITALITY, L.P., a Delaware limited
partnership (the "Acquirer").
RECITALS
A. A/H-BCC Virginia Beach Hotel LLC, a Virginia limited liability company
(the "Company") is the fee simple owner of the 176-room limited service hotel
currently under construction in the City of Virginia Beach, Virginia, and to be
known as the Virginia Beach Hilton Garden Inn (the "Project"). The Company is
governed by the terms of that certain Operating Agreement of the Company dated
as of December 23, 2002 (the "Operating Agreement") between the Contributor and
A/H Hotel, L.L.C., a Virginia limited liability company (the "A/H Member").
B. The Contributor is the record and beneficial owner of a 50% membership
interest in the Company (the "Contributed Assets"). The A/H Member is the owner
of a 50% membership interest in the Company. BCC is the sole member of the
Contributor. The Contributor desires to contribute the Contributed Assets to the
Acquirer, and the Acquirer desires to acquire the Contributed Assets from the
Contributor, on the terms and conditions hereinafter set forth.
AGREEMENT
NOW, THEREFORE, for and in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE I
THE CONTRIBUTION
1.1 Contribution of Contributed Assets. The Contributor agrees to
contribute and transfer the Contributed Assets to the Acquirer, and the Acquirer
agrees to accept transfer of the Contributed Assets pursuant to the terms and
conditions set forth in this Agreement. The Contributed Assets shall be
transferred to the Acquirer free and clear of all liens, encumbrances, security
interests, prior assignments or conveyances, conditions, restrictions, claims,
and other matters affecting title thereto.
1.2 Consideration. The total consideration (the "Consideration") for which
the Contributor agrees to contribute and assign the Contributed Assets to the
Acquirer, and which the Acquirer agrees to pay or deliver to BCC (as the
Contributor's designee for such payment and delivery), subject to the terms of
this Agreement, shall be the issuance to BCC of a number of units of limited
partnership interests in the Acquirer ("Units") equal to (a) fifty percent (50%)
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of the difference between (i) Twenty Million One Hundred Fifty-Four Thousand
Dollars ($20,154,000), which amount includes any working capital of the Company
for the Project, and (ii) Seventeen Million Five Hundred Thousand Dollars
($17,500,000), plus accrued and unpaid interest, as of the "Closing Date" (as
hereinafter defined) on the $17,500,000 construction loan (the "Project Loan")
from Hampton University (the "Lender") to the Company, divided by (b) the price
(net of the underwriting discount) at which the common shares (the "Common
Shares") of Highland Hospitality Corporation, a Maryland corporation (the
"REIT"), are offered to (X) the public in the underwritten initial public
offering of the Common Shares, or (Y) Qualified Institutional Buyers in a
private placement of the Common Shares under Rule 144A of the Securities Act of
1933, as amended, either of which offering shall result in gross offering
proceeds of not less than Two Hundred Million Dollars ($200,000,000) (either of
which offering shall hereinafter be referred to as the "IPO") before any
discounts or fees paid to underwriters or placement agents. The Contributor
hereby directs the Acquirer to issue and deliver the Units directly to BCC on
the Closing Date. BCC executes this Agreement for the purpose of acknowledging
and agreeing to such distribution of the Units to BCC and for the other purposes
set forth herein. No fractional Units will be issued as Consideration hereunder,
but in lieu of issuing fractional Units, the value thereof shall be paid in
cash. The Contributor and BCC acknowledge that any certificates evidencing the
Units will bear appropriate legends indicating (i) that the Units have not been
registered under the Securities Act of 1933, as amended ("Securities Act"), and
(ii) that the Acquirer's Amended and Restated Agreement of Limited Partnership
(the "Partnership Agreement") will restrict the transfer of the Units. Upon
receipt of the Units, BCC shall become a limited partner of the Acquirer and
shall execute the Partnership Agreement. Except as otherwise expressly set forth
in this Agreement, the Contributor and BCC acknowledge and agree that once
Closing occurs, the Contributor shall no longer be a member of the Company,
shall no longer be entitled to receive any distributions from the Company, and
shall have no further right, title or interest in the Company.
1.3 Post-Closing Escrow. At the Closing when the Acquirer pays off the
Project Loan, the Acquirer agrees to fund into an escrow account (the "Escrow")
an amount equal to the difference between (a) $17,500,000, and (b) the actual
principal amount of the Project Loan which is paid off at Closing. The Escrow
shall be held by Acquirer until "Project Close-Out" (as defined below) occurs.
As used herein, the term "Project Close-Out" shall mean the point in time when
all of the following have occurred (collectively, the "Project Close-Out"): (a)
all of the conditions have been satisfied in order for "Placement in Service" to
occur under Section 5.2.2 of the Development Agreement dated as of December 23,
2002 (the "Development Agreement") between the Company and Armada/Xxxxxxx
Development Company, L.L.C. (the "Developer"), and (b) any and all disputes with
the Developer, the General Contractor (as defined in the Development Agreement),
and all other contractors and subcontractor relating to the construction and
development of the Project have been settled and final payments of the
"Development Fee" and all other costs and expenses shown on the current
"Approved Budget" (as those terms are defined in the Development Agreement) have
been paid (including any retainage amounts). The Developer shall be entitled to
request and receive from the Escrow monthly disbursements of funds (upon
complying with the Project Loan draw procedures set forth in the Development
Agreement) in order to pay actual development costs and expenses incurred which
are shown on the current Approved Budget but which were not paid or payable
prior to Closing. Once Project Close-Out has occurred, if the total costs and
expenses that were incurred in order for Project Close-Out to occur is less than
the total costs and expense shown on
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the current Approved Budget (such difference being hereinafter referred to as
the "Cost Savings"), then the Acquirer agrees to cause the Company to pay to the
Contributor from the Escrow 50% of the Cost Savings within thirty (30) business
days after Project Close-Out occurs. If the amount available in the Escrow for
distribution to the Contributor is insufficient to pay the Contributor 50% of
the Cost Savings, then the Acquirer shall pay such insufficient amount to the
Contributor (in the form of Units provided the Contributor continues to be an
accredited investor at such time, or in cash if the Contributor is not an
accredited investor at such time) within thirty (30) business days after Project
Close-Out occurs.
1.4 Redemption Rights for Units. Each Unit shall be redeemable at the
option of the holder, in accordance with, but subject to the restrictions
contained in, the Partnership Agreement; provided, however, that such redemption
option may not be exercised prior to the first anniversary of the Closing Date.
1.5 Tax Consequences to Contributor. Notwithstanding anything to the
contrary contained in this Agreement, including without limitation the use of
words and phrases such as "sell," "sale," purchase," and "pay," the parties
hereto acknowledge and agree that it is their intent that the transaction
contemplated hereby shall be treated for federal income tax purposes pursuant to
Section 721 of the Internal Revenue Code of 1986, as amended (the "Code"), as
the contribution of the Contributed Assets by the Contributor to the Acquirer,
in exchange for the Units, any amounts received by the Contributor pursuant to
Sections 1.2 and 1.3 and any amounts paid by Acquirer on behalf of the
Contributor or BCC pursuant to Section 4.4, and not as a transaction in which
the Contributor is acting other than in its capacity as a prospective partner in
the Acquirer.
ARTICLE II
REPRESENTATIONS AND COVENANTS
2.1 Representations by Acquirer. The Acquirer hereby represents and
warrants unto the Contributor that the following statements are true, correct,
and complete as of the date of this Agreement and will be true, correct, and
complete as of the Closing Date:
(a) Organization and Power. The Acquirer is duly organized, validly
existing, and in good standing under the laws of the State of Delaware, and has
full right, power, and authority to enter into this Agreement and to assume and
perform all of its obligations under this Agreement; and, the execution and
delivery of this Agreement and the performance by the Acquirer of its
obligations hereunder have been duly authorized by all requisite action of the
Acquirer and require no further action or approval of the Acquirer's partners or
of any other individuals or entities in order to constitute this Agreement as a
binding and enforceable obligation of the Acquirer.
(b) Noncontravention. Neither the entry into nor the performance of,
or compliance with, this Agreement by the Acquirer has resulted, or will result,
in any violation of, or default under, or result in the acceleration of, any
obligation under any existing certificate of
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limited partnership, partnership agreement, mortgage, indenture, lien agreement,
note, contract, permit, judgment, decree, order, restrictive covenant, statute,
rule, or regulation applicable to the Acquirer.
(c) Litigation. There is no action, suit, or proceeding, pending or
known to be threatened, against or affecting the Acquirer in any court or before
any arbitrator or before any federal, state, municipal, or other governmental
department, commission, board, bureau, agency or instrumentality which (i) in
any manner raises any question affecting the validity or enforceability of this
Agreement, (ii) could materially and adversely affect the business, financial
position, or results of operations of the Acquirer, (iii) could materially and
adversely affect the ability of the Acquirer to perform its obligations
hereunder, or under any document to be delivered pursuant hereto.
(d) Units Validly Issued. The Units, when issued, will have been duly
and validly authorized and issued, free of any preemptive or similar rights, and
will be fully paid and nonassessable, without any obligation to restore capital
except as required by the Delaware Revised Uniform Limited Partnership Act (the
"Limited Partnership Act"). BCC shall be admitted as a limited partner of the
Acquirer as of the Closing Date and shall be entitled to all of the rights and
protections of a limited partner under the Limited Partnership Act and the
provisions of the Partnership Agreement, with the same rights, preferences, and
privileges as all other limited partners on a pari passu basis. For purposes of
allocating items of income, gain, loss and deduction with respect to the Project
and/or the Contributed Assets in the manner required by Section 704(c) of the
Code, the Acquirer shall employ, and shall cause any entity controlled by the
Acquirer which holds title to the Project or the Contributed Assets to employ,
the "traditional method" (without curative allocations) as set forth in Treasury
Regulation section 1.704-3(b)(1).
(e) Consents. Except as may otherwise be set forth in Section 3.1
hereof, each consent, approval, authorization, order, license, certificate,
permit, registration, designation, or filing by or with any governmental agency
or body necessary for the execution, delivery, and performance of this Agreement
or the transactions contemplated hereby by the Acquirer has been obtained or
will be obtained on or before the Closing Date.
(f) Brokerage Commission. The Acquirer has not engaged the services of
any real estate agent, broker, finder or any other person or entity for any
brokerage or finder's fee, commission or other amount with respect to the
transactions described herein on account of any action by the Acquirer. The
Acquirer hereby agrees to indemnify and hold the Contributor and BCC and their
respective employees, directors, members, partners, affiliates and agents
harmless against any claims, liabilities, damages or expenses arising out of a
breach of the foregoing. This indemnification shall survive Closing or any
termination of this Agreement.
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2.2 Representations by Contributor and BCC. The Contributor and BCC hereby
make the following representations and warranties, each and every one of which
is true, correct, and complete as of the date of this Agreement (unless they
expressly provide for a future date), and will be true, correct, and complete as
of the Closing Date:
(a) Organization and Power. The Contributor is a limited liability
company, duly organized, validly existing, and in good standing under the laws
of the State of Delaware. The Contributor has full right, power, and authority
to enter into this Agreement and to assume and perform all of its obligations
under this Agreement; and the execution and delivery of this Agreement and the
performance by the Contributor of its obligations hereunder have been duly
authorized by all requisite action of Contributor and require no further action
or approval of Contributor's officers, directors or shareholders or of any other
individuals or entities (other than the A/H Member pursuant to the Operating
Agreement, which consent has been obtained under a separate contribution
agreement between the Acquirer and the A/H Member) in order to constitute this
Agreement as a binding and enforceable obligation of the Contributor.
(b) Noncontravention. Neither the entry into nor the performance of,
or compliance with, this Agreement by the Contributor or BCC has resulted, or
will result, in any violation of, or default under, or result in the
acceleration of, any obligation under any limited liability company agreement,
regulations, mortgage indenture (except as may be otherwise provided in the
"Construction Loan Documents," as that term is defined in the Operating
Agreement), lien agreement, note, contract, permit, judgment, decree, order,
restrictive covenant, statute, rule, or regulation applicable to Contributor,
BCC or to the Contributed Assets.
(c) Litigation. There is no action, suit, or proceeding, pending or
known to be threatened, against or affecting the Contributor, the Company or the
Project in any court or before any arbitrator or before any federal, state,
municipal, or other governmental department, commission, board, bureau, agency
or instrumentality which (A) in any manner raises any question affecting the
validity or enforceability of this Agreement, (B) could materially and adversely
affect the business, financial position, or results of operations of the
Contributor, the Company or the Project, (C) could materially and adversely
affect the ability of the Contributor to perform its obligations hereunder, or
under any document to be delivered pursuant hereto, (D) could create a lien on
the Contributed Assets, the Company, the Project, any part thereof, or any
interest therein, or (E) could materially and adversely affect the Contributed
Assets, the Company, the Project, any part thereof, or any interest therein.
(d) Good Title. (A) The Contributor is the sole owner of the
Contributed Assets, (B) the Contributor has good title to the Contributed
Assets, (C) the Contributed Assets are free and clear of all liens,
encumbrances, pledges, conditions, restrictions, claims and security interests
and any other matters affecting title thereto, and (D) the Contributor has not
granted any other person or entity an option to purchase or a right of first
refusal upon the Contributed Assets nor are there any agreements or
understandings between Contributor and any other person or entity with respect
to the disposition of the Contributed Assets (except as may be otherwise
provided in the "Construction Loan Documents," as that term is defined in the
Operating Agreement.
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(e) No Consents. Except as may otherwise be set forth in Section 3.1
hereof, each consent, approval, authorization, order, license, certificate,
permit, registration, designation, or filing by or with any governmental agency
or body necessary for the execution, delivery, and performance of this Agreement
or the transactions contemplated hereby by the Contributor has been obtained or
will be obtained on or before the Closing Date.
(f) Operation of Contributed Assets. Between the date hereof and the
Closing Date, the Contributor will (A) operate its business only in the usual,
regular, and ordinary manner consistent with such entity's prior practice and
(B) maintain its books of account and records in the usual, regular, and
ordinary manner, in accordance with sound accounting principles applied on a
basis consistent with the basis used in keeping its books in prior years. From
the date hereof until the Closing Date, the Contributor shall not take any
action or fail to take any action the result of which would (1) have a material
adverse effect on the Contributed Assets, the Project, the Company or the
Acquirer's ability to continue the operation thereof after the Closing Date in
substantially the same manner as presently conducted or (2) would cause any of
the representations and warranties contained in this Section 2.2 to be untrue as
of the Closing Date.
(g) Operating Agreement. The Operating Agreement is in force and
effect as of the date hereof, and has not been further modified or amended. The
Contributor has performed all of its obligations under the Operating Agreement.
No event of default or event that with notice or the passage of time, or both,
would constitute an event of default has occurred under the Operating Agreement.
(h) Securities Law Matters. (A) In acquiring the Units and engaging in
this transaction, neither the Contributor nor BCC is relying upon any
representations made to it by the Acquirer, or any of its partners, officers,
employees, or agents that are not contained herein. The Contributor and BCC are
aware of the risks involved in investing in the Units and in the Common Shares
issuable upon redemption of such Units. The Contributor and BCC have had an
opportunity to ask questions of, and to receive answers from, the Acquirer and
the REIT or a person or persons authorized to act on their behalf, concerning
the terms and conditions of this investment and the financial condition,
affairs, and business of the Acquirer and the REIT. The Contributor and BCC
confirm that all documents, records, and information pertaining to its
investment in the Acquirer that have been requested by it, including a complete
copy of the form of the Partnership Agreement, have been made available or
delivered to it prior to the date hereof. The Contributor and BCC represent and
warrant that each has reviewed and approved the form of the Partnership
Agreement attached hereto as Exhibit B.
(B) The Contributor and BCC understand that neither the Units nor
the Common Shares issuable upon redemption of the Units have been registered
under the Securities Act or any state securities acts and are instead being
offered and sold in reliance on an exemption from such registration
requirements. The Units issuable to BCC at the direction of the Contributor are
being acquired solely for its own account, for investment, and are not being
acquired with a view to, or for resale in connection with, any distribution,
subdivision, or fractionalization thereof, in violation of such laws, and
neither BCC nor the Contributor has any present intention to enter into any
contract, undertaking, agreement, or arrangement with respect to any such
resale. The Contributor and BCC understand that any certificates evidencing the
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Units will contain appropriate legends reflecting the requirement that the Units
not be resold without registration under such laws or the availability of an
exemption from such registration and that the Partnership Agreement will
restrict transfer of the Units.
(i) Accredited Investors. The Contributor and BCC are each an
accredited investor as that term is defined in Rule 501 of Regulation D under
the Securities Act of 1933, as amended.
(j) Tax Matters. (A) The Contributor has filed within the time periods
(including any extensions of such time periods filed by the Contributor) and in
the manner prescribed by law all federal, state, and local tax returns and
reports, including but not limited to income, gross receipts, intangible, real
property, excise, withholding, franchise, sales, use, employment, personal
property, and other tax returns and reports, required to be filed by the
Contributor under the laws of the United States and of each state or other
jurisdiction in which the Contributor conducts business activities requiring the
filing of tax returns or reports. All tax returns and reports filed by the
Contributor are true and correct in all material respects. The Contributor has
paid in full all taxes of whatever kind or nature to be paid by the Contributor
for the periods covered by such returns (unless an extension of such periods has
been properly filed for such returns). The Contributor has no tax deficiency or
claim outstanding, assessed, threatened, or proposed against it. The charges,
accruals, and reserves for unpaid taxes on the books and records of the
Contributor as of the Closing Date are sufficient in all respects for the
payment of all unpaid federal, state, and local taxes of the Contributor accrued
for or applicable to all periods ended on or before the Closing Date. There are
no tax liens, whether imposed by the United States, any state, local, or other
taxing authority, outstanding against the Contributor or any of its assets. The
federal, state, and local tax returns of the Contributor have not been audited,
nor has the Contributor received any notice of any federal, state, or local
audit.
(B) The Contributor and BCC represent and warrants that they have
obtained from their own counsel advice regarding the transaction contemplated by
this Agreement, including, without limitation, the tax consequences of (i) the
transfer of the Contributed Assets to the Acquirer and the receipt of Units as
consideration therefor and (ii) BCC's admission as a limited partner of the
Acquirer. The Contributor and BCC further represent and warrant that they have
not relied on the Acquirer or the Acquirer's representatives or counsel for such
tax advice.
(k) Bankruptcy with respect to Contributor. No Act of Bankruptcy has
occurred with respect to the Contributor or BCC. As used herein, "Act of
Bankruptcy" shall mean if a party hereto or any member or manager thereof shall
(A) apply for or consent to the appointment of, or the taking of possession by,
a receiver, custodian, trustee or liquidator of itself or of all or a
substantial part of its property, (B) admit in writing its inability to pay its
debts as they become due, (C) make a general assignment for the benefit of its
creditors, (D) file a voluntary petition or commence a voluntary case or
proceeding under the Federal Bankruptcy Code (as now or hereafter in effect),
(E) be adjudicated bankrupt or insolvent, (F) file a petition seeking to take
advantage of any other law relating to bankruptcy, insolvency, reorganization,
receivership, dissolution, winding-up or composition or adjustment of debts, (G)
fail to controvert in a timely and appropriate manner, or acquiesce in writing
to, any petition filed against it in an involuntary case or proceeding under the
Federal Bankruptcy Code (as now or
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hereafter in effect), or (H) take any entity action for the purpose of effecting
any of the foregoing.
(l) Brokerage Commission. The Contributor has not engaged the services
of, any real estate agent, broker, finder or any other person or entity for any
brokerage or finder's fee, commission or other amount with respect to the
transactions described herein on account of any action by the Contributor. The
Contributor hereby agrees to indemnify and hold the Acquirer and its employees,
directors, members, partners, affiliates and agents harmless against any claims,
liabilities, damages or expenses arising out of a breach of the foregoing. This
indemnification shall survive Closing or any termination of this Agreement.
(m) Project Representations and Warranties. To the best of the
Contributor's knowledge, each of the following statements with respect to the
Project is true, correct and complete as of the date of this Agreement (unless
they expressly provide for a future date), and will be true, correct and
complete as of the Closing Date:
(A) Title to Project. The Company owns good and marketable fee
simple title of record to the Project, free and clear of any claim, lien,
charge, security interest, mortgage, deed of trust, encumbrance, purchase rights
or other rights of any nature whatsoever of any third party, other than the deed
of trust securing the Project Loan, the lien for real estate taxes and
assessments not yet due or payable, and such recorded easements and restrictions
which do not materially adversely affect the marketability of title to the
Project or the use of the Project for its intended use.
(B) No Agreements to Sell. The Company has made no agreement
with, and will not enter into any agreement with, and has no obligation
(absolute or contingent) to, any other person or firm to sell, transfer or in
any way encumber the Project or to not sell the Project, or to enter into any
agreement with respect to a sale, transfer or encumbrance of or put or call
right with respect to the Project.
(C) Leases. True, correct and complete copies of the "Master
Declaration", the "Town Center Covenants" (as those terms are defined in the
Operating Agreement) and the Development Agreement have been delivered to the
Acquirer and its agents and underwriters. Neither the Company nor any other
party to the Development Agreement, the Town Center Covenants or the Master
Declaration is in default thereunder, and no event has occurred which, but for
the passage of time or the giving of notice, or both, would constitute a default
under the Development Agreement, the Town Center Covenants or the Master
Declaration.
(D) Franchise Agreement. A true, correct and complete copy of the
"Franchise Agreement" (as defined in the Operating Agreement) has been delivered
or made available to the Acquirer and its agents and underwriters. The Franchise
Agreement is valid, binding and enforceable and is presently in full force and
effect. Neither the Company nor the other parties to the Franchise Agreement is
in default under the Franchise Agreement, and no event has occurred which, but
for the passage of time or the giving of notice, or both, would constitute a
default under the Franchise Agreement.
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(E) Liabilities; Indebtedness. Except for the Project Loan, the
Company has not incurred any indebtedness related to the Project except in each
instance for trade payables and other customary and ordinary expenses in the
ordinary course of business that have been disclosed to the Acquirer.
(F) Insurance. The Company currently maintains or causes to be
maintained all of the public liability, casualty and other insurance coverage
with respect to the Project that is required under the terms of the Construction
Loan Documents and the "Management Agreement" (as defined in the Operating
Agreement). All such insurance coverage shall be maintained in full force and
effect through the Closing and all premiums due and payable thereunder have
been, and shall be, fully paid through Closing.
(G) Personal Property. All equipment, fixtures and personal
property located at or on the Project shall remain and not be removed prior to
the Closing, except for equipment that becomes obsolete or unusable, which may
be disposed of or replaced in the ordinary course of business.
(H) Environmental Conditions. Except as set forth in the
environmental reports and materials previously delivered to the Acquirer
(collectively, "Environmental Reports"), neither the Contributor nor the Company
has received any written notice of the presence or release of any substance that
is regulated under any Environmental Laws as a pollutant, contaminant or toxic,
radioactive or otherwise hazardous substance, including petroleum, its
derivatives or by-products and other hydrocarbons (collectively and
individually, "Hazardous Substances") that would cause the Project or the
Company to be in violation of any applicable Environmental Laws and that remains
uncured, nor has the Contributor or the Company received written notice that the
Project is not in compliance with applicable Environmental Laws. Except as
otherwise disclosed in the Environmental Reports, (i) there are no Hazardous
Substances located at, on or under the Project and (ii) no Hazardous Substances
have leaked, escaped or been discharged, emitted or otherwise released from the
Project onto any adjoining properties. For the purposes of this Section,
"Environmental Laws" means any and all federal, state and local statutes, laws,
regulations and rules in effect on the date hereof relating to the protection of
the environment or to the use, transportation and disposal of Hazardous
Substances.
(I) Compliance With Laws. The Company possesses and/or on or
prior to Closing will possess such certificates, authorities or permits issued
by the appropriate state or federal agencies or bodies necessary to conduct the
business to be conducted by it, and the Company has not received any written
notice of proceedings that have been or may be commenced relating to the
revocation or modification or any such certificate, authority or permit which,
singly or in the aggregate, if the subject of an unfavorable decision, ruling,
or finding, would materially and adversely affect the condition, financial or
otherwise, or the earnings, business affairs or business prospects of the
Project. The Company has not received any written or other notice of any
violation of any applicable zoning, building or safety code, rule, regulation or
ordinance, or of any employment, environmental, wetlands or other regulatory
law, order, regulation or other requirement, including without limitation the
Americans With Disabilities Act ("ADA") or any restrictive covenants or other
easements, encumbrances or agreements, relating to the Project, which remains
uncured and would materially and adversely affect the
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condition, financial or otherwise, or the earnings, business affairs or business
prospects of the Project. The Project is being constructed in material
compliance with all applicable laws, ordinances, rules and regulations, and all
material approvals regarding zoning, land use, subdivision, environmental and
building and construction laws, ordinances, rules and regulations will be
obtained by Closing, and such approvals will not be invalidated by the
consummation of the transactions contemplated by this Agreement (other than
those licenses and permits, including without limitation, liquor license, for
which new licenses and permits must be obtained by law as a result of the change
in the ownership of the Contributed Assets contemplated by this Agreement).
(J) Condemnation and Moratoria. There are (i) no pending or
threatened condemnation or eminent domain proceedings, or negotiations for
purchase in lieu of condemnation, which affect or would affect any portion of
the Project; (ii) no pending or threatened moratoria on utility or public water
or sewer hook-ups or the issuance of permits, licenses or other inspections or
approvals necessary in connection with the construction or reconstruction of
improvements which affect or would affect any portion of the Project; and (iii)
no pending or threatened proceeding to change adversely the existing zoning
classification as to any portion of the Project. No portion of the Project is a
designated historic property or located within a designated historic area or
district, and there are no graveyards or burial grounds located within any of
the Project.
(K) Condition of Improvements. There is no material defect in the
condition of the Project in its current stage of construction, including the
improvements thereon, the roof, foundation, load-bearing walls or other
structural elements thereof, and the mechanical, electrical, plumbing and,
safety systems therein, to the extent that such items exist or have been
installed as of the date of this Agreement. No material damage to the Project in
its current stage of construction has occurred from casualty or other cause, nor
is there any soil condition of any nature that will not support all of the
improvements being constructed thereon without the need for unusual or new
subsurface excavations, fill, footings, caissons or other installations.
(L) Taxes. (i) All taxes (including real estate taxes due and
owing with respect to the Project) have been paid and all tax or information
returns required to be filed on or before the date hereof by or on behalf of the
Company have been filed and all such tax or information returns required to be
filed hereafter will be filed on or before the date due in accordance with all
applicable laws prior to the incurrence of any penalties or interest thereon and
all taxes shown to be due on any returns have been paid or will be paid when
due; and (ii) there is no action, suit or proceeding pending against or
threatened with respect to the Company or the Project in respect of any tax, nor
is any claim for additional tax asserted by any taxing authority. Neither the
Company nor any of its federal, state and local income or franchise tax returns
are the subject of any audit or examination by any taxing authority.
(M) A true, correct and complete copy of the standard form of
general contractor agreement, dated November 6, 2002, between the Company and
Armada Xxxxxxx Construction Company (the "General Contract") has been delivered
or made available to the Acquirer and its agents and underwriters and neither
party to the General Contract is in default thereunder, and no event has
occurred which, but for the passage of time or the giving of notice
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or both, would constitute a default under the General Contract. The General
Contract is valid, binding and enforceable and is presently in full force and
effect.
2.3 Satisfaction of Conditions. The Acquirer hereby covenants that the
Acquirer shall: (I) use commercially reasonable efforts and diligence in order
to satisfy all of the conditions set forth in subsections 3.1(d), (e) and (h),
and Section 3.2 hereof, and (II) cooperate and assist in the Contributor's
efforts to satisfy the conditions set forth in subsection 3.1(c) hereof; and the
Contributor shall not have any obligation to consummate the Closing hereunder
unless and until all such conditions have been satisfied or waived by the
Contributor in writing. The Contributor hereby covenants that the Contributor
shall: (A) use commercially reasonable efforts and diligence in order to satisfy
all of the conditions set forth in subsections 3.1(a), (b) and (c) hereof, and
(B) cooperate and assist in the Acquirer's efforts to satisfy the conditions set
forth in subsections 3.1(d) and subsection 3.2(c) hereof; and the Acquirer shall
not have any obligation to consummate the Closing hereunder unless and until
such conditions have been satisfied or waived by the Acquirer in writing.
2.4 Contributor's and BCC's Indemnity. The Contributor and BCC hereby
jointly and severally agree to indemnify and hold the Acquirer, the REIT, and
their respective employees, directors, members, partners, affiliates and agents
harmless of and from all liabilities, losses, damages, costs, and expenses
(including reasonable attorneys' fees) which the Acquirer or the REIT may suffer
or incur by reason of (a) any breach of the representations or warranties
contained in Section 2.2 of this Agreement, (b) any act or cause of action
occurring or accruing prior to the Closing Date and arising from the ownership
of the Contributed Assets prior to the Closing Date, and (c) the ownership or
operation of the Project and relating to the period prior to the Closing Date,
including, without limitation, pre-opening and construction and development
costs and actions or claims relating to damage to property or injury to or death
of any person occurring or arising during the period prior to the Closing Date,
or any claims for any debts or obligations occurring on or about or in
connection with the Project or any portion thereof or with respect to the
Project's operations at any time prior to the Closing Date (subject to the
reconciliation of the operating accounts of the Project).
2.5 Acquirer's Indemnity. The Acquirer agrees to indemnify and hold the
Contributor, BCC and their respective employees, directors, members, partners,
affiliates and agents harmless of and from all liabilities, losses, damages,
costs, and expenses (including reasonable attorneys' fees) which the Contributor
may suffer or incur by reason of (a) any breach of its representations or
warranties contained in Section 2.1 of this Agreement, (b) any act or cause of
action occurring or accruing on or after the Closing Date and arising from the
ownership of the Contributed Assets on or after the Closing Date, and (c) the
ownership or operation of the Project and relating to the period on or after the
Closing Date, including, without limitation, actions or claims relating to
damage to property or injury to or death of any person occurring or arising
during the period on or after the Closing Date, or any claims for any debts or
obligations occurring on or about or in connection with the Project or any
portion thereof or with respect to the Project's operations at any time on or
after the Closing Date.
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ARTICLE III
CONDITIONS PRECEDENT TO THE CLOSING
3.1 Conditions to Acquirer's Obligations. In addition to any other
conditions set forth in this Agreement, the Acquirer's obligation to consummate
the Closing is subject to the timely satisfaction of each and every one of the
conditions and requirements set forth in this Section 3.1, all of which shall be
conditions precedent to the Acquirer's obligations under this Agreement.
(a) Contributor's Obligations. The Contributor shall have performed
all obligations of the Contributor hereunder which are to be performed prior to
Closing, and shall have delivered or caused to be delivered to the Acquirer, all
of the documents and other information required of the Contributor pursuant to
Section 4.2.
(b) Contributor's Representations and Warranties. The Contributor's
and BCC's representations and warranties set forth in Section 2.2 shall be true
and correct as if made again on the Closing Date.
(c) No Injunction. On the Closing Date, there shall be no effective
injunction, writ, preliminary restraining order or other order issued by a court
of competent jurisdiction restraining or prohibiting the consummation of the
transactions contemplated hereby.
(d) Third Party Consents. To the extent required by the Franchise
Agreement, the Master Declaration, the Town Center Covenants or any other
documents or instruments binding on the Company, the Contributor or the Project
which may require consent to the following, the Acquirer shall have obtained the
consent of the Franchisor, the "Virginia Beach Authorities" (as defined in the
Operating Agreement) and such other parties to (i) the Acquirer's acquisition of
the Contributed Assets, (ii) the lease or sublease of the Project from the
Company to a wholly-controlled affiliate of the Acquirer (the "TRS Affiliate"),
and (iii) either assigning the existing Franchise Agreement to the TRS Affiliate
or entering into a new franchise agreement for the Project between the
Franchisor and the TRS Affiliate (the "New Franchise Agreement").
(e) Completion of IPO. The IPO shall have been completed.
(f) Completion and Certificate of Occupancy. Placement in Service"
shall have occurred under Section 5.2.2 of the Development Agreement, and a
final certificate of occupancy for the entire Project (the "CO") shall have been
issued.
(g) A/H Contribution Agreement Closing. Each of the conditions
precedent to the Acquirer's obligations to close under that certain Contribution
Agreement dated as of , 2003 (the "A/H Contribution Agreement") between
---------
the A/H Member and the Acquirer shall have been satisfied or waived by the
Acquirer (including without limitation, the condition that the Project Loan
shall be paid in full, all Construction Loan Documents shall be terminated and
released of record, and the "Participation Release Agreement", as defined in the
A/H Contribution Agreement, shall be fully executed and delivered), and the
closing under the A/H Contribution Agreement shall have occurred or shall occur
simultaneously with the Closing hereunder.
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(h) Franchise Documents. Either the existing Franchise Agreement shall
have been assigned by the Company to the TRS Affiliate with all necessary
consents from the Franchisor, or the New Franchise Agreement shall have been
executed by the Franchisor and the TRS Affiliate.
(i) Participation Release Agreement. The "Participation Release
Agreement" (as defined in the A/H Contribution Agreement) shall have been
executed and delivered by the parties thereto.
3.2 Conditions to Contributor's Obligations. In addition to any other
conditions set forth in this Agreement, the Contributor's obligations to
consummate the Closing is subject to the timely satisfaction of each and every
one of the conditions and requirements set forth in this Section 3.2, all of
which shall be conditions precedent to the Contributor's obligations under this
Agreement.
(a) Acquirer's Obligations. The Acquirer shall have performed all
obligations of the Acquirer hereunder which are to be performed prior to
Closing, and shall have delivered or caused to be delivered to the Contributor,
all of the documents and other information required of the Acquirer pursuant to
Section 4.3.
(b) Acquirer's Representations and Warranties. The Acquirer's
representations and warranties set forth in Section 2.1 shall be true and
correct as if made again on the Closing Date.
(c) Project Loan. The Project Loan shall be paid in full concurrently
with the Closing and the Lender shall have executed the Participation Release
Agreement.
(d) Completion of IPO. The IPO shall have been completed.
(e) A/H Contribution Agreement Closing. Each of the conditions
precedent to the Acquirer's obligations to close under the A/H Contribution
Agreement shall have been satisfied or waived by the Acquirer, and the closing
under the A/H Contribution Agreement shall have occurred or shall occur
simultaneously with the Closing hereunder.
(f) Participation Release Agreement. The Participation Release
Agreement shall have been executed and delivered by the parties hereto.
ARTICLE IV
CLOSING AND CLOSING DOCUMENTS
4.1 Closing. The consummation and closing (the "Closing") of the
transactions contemplated under this Agreement shall take place at the offices
of the Acquirer in McLean, Virginia, or such other place as is mutually
agreeable to the parties, on the later to occur of the following unless
otherwise set by agreement of the parties (such date being referred to herein as
the "Closing Date"): (a) the date which is ten (10) business days after the CO
is issued and Placement in Service has occurred, or (b) the date of the closing
of the IPO; provided, however, that this Agreement shall terminate if Closing
does not occur prior to March 31, 2004.
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4.2 Contributor's Deliveries. At the Closing, the Contributor and BCC, as
applicable, shall deliver the following to the Acquirer in addition to all other
items required to be delivered to the Acquirer by the Contributor or BCC:
(a) Assignment of Contributed Assets. The Contributor shall have
executed and delivered an Assignment, in substantially the form of Exhibit A
attached hereto, granting and conveying to the Acquirer good and indefeasible
title to the Contributed Assets, free and clear of all liens, encumbrances,
security interests, prior assignments, conditions, restrictions, claims, and
other matters affecting title thereto.
(b) Execution of Partnership Agreement. Signature pages of the
Partnership Agreement (which Partnership Agreement shall be in substantially the
form attached hereto as Exhibit B) duly executed by BCC, as limited partner.
(c) FIRPTA Certificate. An affidavit from the Contributor certifying
pursuant to Section 1445 of the Internal Revenue Code that the Contributor is
not a foreign corporation, foreign partnership, foreign trust, foreign estate or
foreign person (as those terms are defined in the Internal Revenue Code and the
Income Tax Regulations promulgated thereunder).
(d) Other Documents. Any other document or instrument reasonably
requested by the Acquirer or required hereby. Without limiting the generality of
the foregoing, to the extent that individuals associated with the Contributor or
BCC serve as officers or directors in any boards or associations that are
associated with the Master Declaration, the Town Center Covenants or the "Town
Center Project" (as defined in the Operating Agreement), the Contributor and BCC
shall cause such individuals to resign and withdraw from such positions at
Closing.
(e) Participation Release Agreement. The fully executed Participation
Release Agreement.
4.3 Acquirer's Deliveries. At the Closing, the Acquirer shall deliver the
following:
(a) Certificates for Units. If certificates are issued, certificates
representing Units duly issued by the Acquirer in the name of BCC as of the
Closing Date representing the Units to which the Contributor is entitled
pursuant to Section 1.2 of this Agreement.
(b) Executed Partnership Agreement. The fully executed Partnership
Agreement, with the original duly executed signature of the REIT, as general
partner, and original or photostatic copies of the signatures of all limited
partners.
(c) Other Documents. Any other document or instrument reasonably
requested by the Contributor or required hereby.
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4.4 Fees and Expenses; Closing Costs. The Acquirer shall pay all fees,
expenses and closing costs relating to the transactions contemplated by this
Agreement; provided however, that the Contributor and BCC shall pay their own
attorneys' and consultants' fees and expenses.
4.5 Default Remedies. If the closing of the IPO occurs and all of the other
conditions precedent set forth in Section 3.1 hereof have been satisfied, but
the Acquirer fails to consummate the Closing contemplated hereunder with the
Contributor, the Contributor shall have the right, as the Contributor's sole and
exclusive remedy for such default, to seek specific performance of this
Agreement. If the Contributor defaults in performing any of the Contributor's
obligations under this Agreement, the Acquirer shall have all rights and
remedies available to it at law or in equity resulting from the Contributor's
default, including without limitation, the right to seek specific performance of
this Agreement and the Contributor's obligation to convey the Contributed Assets
to the Acquirer hereunder. The parties acknowledge and agree that the failure of
a condition precedent to occur, notwithstanding the good faith and commercially
reasonable efforts of the applicable party, shall not be a default hereunder.
ARTICLE V
MISCELLANEOUS
5.1 Notices. Any notice provided for by this Agreement and any other
notice, demand, or communication required hereunder shall be in writing and
either delivered in person (including by confirmed facsimile transmission) or
sent by hand delivered against receipt or sent by recognized overnight delivery
service or by certified or registered mail, postage prepaid, with return receipt
requested. All notices shall be addressed as follows:
Acquirer:
c/o Highland Hospitality Corporation
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
XxXxxx, XX 00000
Attention: General Counsel
Fax No.: (000) 000-0000
with a copy to:
c/o Highland Hospitality Corporation
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
XxXxxx, XX 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
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Contributor or BCC:
c/o Barcelo Crestline Corporation
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
XxXxxx, XX 00000
Attention: General Counsel
Fax No.: (000) 000-0000
with a copy to:
x/x Xxxxxxx Xxxxxxxxx Corporation
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
XxXxxx, XX 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
Any address or name specified above may be changed by a notice given by the
addressee to the other party. Any notice, demand or other communication shall be
deemed given and effective as of the date of delivery in person or receipt set
forth on the return receipt. The inability to deliver because of changed address
of which no notice was given, or rejection or other refusal to accept any
notice, demand or other communication, shall be deemed to be receipt of the
notice, demand or other communication as of the date of such attempt to deliver
or rejection or refusal to accept.
5.2 Entire Agreement; Modifications and Waivers; Cumulative Remedies. This
Agreement supersedes any existing letter of intent between the parties,
constitutes the entire agreement among the parties hereto and may not be
modified or amended except by instrument in writing signed by the parties
hereto, and no provisions or conditions may be waived other than by a writing
signed by the party waiving such provisions or conditions. No delay or omission
in the exercise of any right or remedy accruing to the Contributor or the
Acquirer upon any breach under this Agreement shall impair such right or remedy
or be construed as a waiver of any such breach theretofore or thereafter
occurring. The waiver by the Contributor or the Acquirer of any breach of any
term, covenant, or condition herein stated shall not be deemed to be a waiver of
any other breach, or of a subsequent breach of the same or any other term,
covenant, or condition herein contained. All rights, powers, options, or
remedies afforded to Contributor or the Acquirer either hereunder or by law
shall be cumulative and not alternative, and the exercise of one right, power,
option, or remedy shall not bar other rights, powers, options, or remedies
allowed herein or by law, unless expressly provided to the contrary herein.
5.3 Exhibits. All exhibits referred to in this Agreement and attached
hereto are hereby incorporated in this Agreement by reference.
5.4 Successors and Assigns. Upon the request of the Acquirer, the
Contributor agrees to transfer at Closing the Contributed Assets (or portions
thereof) to the Acquirer and to one or more wholly-controlled affiliates of the
Acquirer. Except as set forth above or elsewhere in this Agreement, this
Agreement may not be assigned by the Acquirer, BCC or the Contributor without
the prior approval of the other party hereto. This Agreement shall be binding
upon, and
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inure to the benefit of, the Contributor, BCC, the Acquirer, and their
respective legal representatives, successors, and permitted assigns.
5.5 Article Headings. Article headings and article and section numbers are
inserted herein only as a matter of convenience and in no way define, limit, or
prescribe the scope or intent of this Agreement or any part hereof and shall not
be considered in interpreting or construing this Agreement.
5.6 Governing Law. This Agreement shall be construed and interpreted in
accordance with the laws of the Commonwealth of Virginia, without regard to
conflicts of laws principles.
5.7 Counterparts. This Agreement may be executed in any number of
counterparts and by any party hereto on a separate counterpart, each of which
when so executed and delivered shall be deemed an original and all of which
taken together shall constitute but one and the same instrument.
5.8 Survival. All representations and warranties contained in this
Agreement, and all covenants and agreements contained in the Agreement which
contemplate performance after the Closing Date (including, without limitation,
those covenants and agreements contained in Sections 1.2, 1.3, 2.4 and 2.5
hereof) shall survive the Closing.
5.9 Further Acts. In addition to the acts, instruments and agreements
recited herein and contemplated to be performed, executed and delivered by the
Acquirer, BCC and the Contributor, the Acquirer, BCC and Contributor shall
perform, execute, and deliver or cause to be performed, executed, and delivered
at the Closing or after the Closing, any and all further acts, instruments, and
agreements and provide such further assurances as the other parties may
reasonably require to consummate the transaction contemplated hereunder.
5.10 Severability. In case any one or more of the provisions contained in
this Agreement shall for any reason be held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or unenforceability
shall not affect any other provision hereof, and this Agreement shall be
construed as if such invalid, illegal, or unenforceable provision had never been
contained herein.
5.11 Attorneys' Fees. Should a party employ an attorney or attorneys to
enforce any of the provisions hereof or to protect its interest in any manner
arising under this Agreement, or to recover damages for breach of this
Agreement, any non-prevailing party in any action pursued in a court of
competent jurisdiction (the finality of which is not legally contested) shall
pay to the prevailing party all reasonable costs, damages, and expenses,
including reasonable attorneys' fees, expended or incurred in connection
therewith.
5.12 Confidentiality. The Contributor and BCC acknowledge that the matters
relating to the REIT, the IPO, this Agreement, and the other documents, terms,
conditions and information related thereto (collectively, the "Information") are
confidential in nature. Therefore, the Contributor and BCC covenant and agree to
keep the Information confidential and will not (except as required by applicable
law, regulation or legal process including applicable securities laws), without
the Acquirer's prior written consent, disclose any Information in any
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manner whatsoever; provided, however, that the Information may be revealed only
to the Contributor's and BCC's key employees, legal counsel and financial
advisors and to the Lender, the Virginia Beach Authority and the Franchisor,
each of whom shall be informed of the confidential nature of the Information and
shall agree to act in accordance with the terms of this Section 5.12. In the
event that the Contributor, BCC or its key employees, legal counsel or financial
advisors or the Lender, the Virginia Beach Authorities or the Franchisor
(collectively, the "Information Group") are requested pursuant to, or required
by, applicable law (other than in connection with the IPO), regulation or legal
process to disclose any of the Information, the applicable member of the
Information Group will notify the Acquirer promptly so that it may seek a
protective order or other appropriate remedy or, in its sole discretion, waive
compliance with the terms of this Section 5.12. In the event that no such
protective order or other remedy is obtained, or that the Acquirer waives
compliance with the terms of this Section 5.12, the applicable member of the
Information Group may furnish only that portion of the Information which it is
advised by counsel is legally required and will exercise all reasonable efforts
to obtain reliable assurance that confidential treatment will be accorded the
Information. The Contributor and BCC acknowledge that remedies at law may be
inadequate to protect the Acquirer or the REIT against any actual or threatened
breach of this Section 5.12, and, without prejudice to any other rights and
remedies otherwise available, the Contributor and BCC agree to the granting of
injunctive relief in favor of the REIT and/or the Acquirer without proof of
actual damages. Notwithstanding any other express or implied agreement to the
contrary, the parties agree and acknowledge that each of them and each of their
employees, representatives, and other agents may disclose to any and all
persons, without limitation of any kind, the tax treatment and tax structure of
the transaction and all materials of any kind (including opinions or other tax
analyses) that are provided to any of them relating to such tax treatment and
tax structure, except to the extent that confidentiality is reasonably necessary
to comply with U.S. federal or state securities laws. For purposes of this
paragraph, the terms "tax treatment" and "tax structure" have the meanings
specified in Treasury Regulation section 1.6011-4(c).
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
[SIGNATURES APPEAR ON FOLLOWING PAGE.]
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IN WITNESS WHEREOF, this Agreement has been entered into effective as of
the 4th day of September, 2003.
CONTRIBUTOR:
BCC VIRGINIA BEACH LLC, a Delaware limited
liability company
By: /s/ Xxxxxxxxx X. Xxxxxxxxx
----------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxx
Title: Vice President
ACQUIRER:
HIGHLAND HOSPITALITY, L.P. a Delaware
limited partnership
By: Highland Hospitality Corporation, its
General Partner
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President and Chief Executive
Officer
BCC:
BARCELO CRESTLINE CORPORATION,
a Maryland corporation
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: President and Chief Executive Officer
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EXHIBIT A
Assignment
BCC VIRGINIA BEACH LLC, a Delaware limited liability company (the
"Assignor"), for good and valuable consideration paid to the Assignor by
Highland Hospitality, L.P., a Delaware limited partnership ("Assignee"),
pursuant to the Contribution Agreement dated as of , 2003, by and
---------------
between Assignor, Barcelo Crestline Corporation and Assignee (the "Agreement")
and for other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, does hereby sell, assign, transfer, convey and deliver
to the Assignee, its successors and assigns, good and indefeasible title to the
Contributed Assets, free and clear of all liens, encumbrances, security
interests, prior assignments, conditions, restrictions, claims, and other
matters affecting title thereto.
Capitalized terms used but not defined herein shall have the respective
meanings ascribed to them in the Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
signed by a duly authorized officer this day of , 200 .
-- ----- --
BCC VIRGINIA BEACH LLC, a Delaware limited
liability company
By:
-----------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxx
Title: Vice President
EXHIBIT B
Partnership Agreement