EFTA00797688.pdf

AMENDED, RESTATED AND CONSOLIDATED LOAN AGREEMENT Dated as of July 18, 2017 By and Among LIFE HOTEL ONE LLC, as Borrower, DEUTSCHE BANK AG, NEW YORK BRANCH, as Agent, and DEUTSCHE BANK AG, NEW YORK BRANCH, and any other lending institutions which may from time to time become a party hereto as Lenders PROPERTY: Life Hotel 19 West 31' Street New York, NY EFTA00797688  TABLE OF CONTENTS Page ARTICLE 1 DEFINITIONS; PRINCIPLES OF CONSTRUCTION 2 Section 1.1 Specific Definitions 2 Section 1.2 Index of Other Definitions 25 Section 1.3 Principles of Construction 29 ARTICLE 2 THE LOAN 29 Section 2.1 The Loan 29 2.1.1 Agreement to Lend and Borrow 29 2.1.2 Disbursements to Borrower 29 2.1.3 The Note 29 2.1.4 Use of Proceeds 29 Section 2.2 Interest Rate 30 2.2.1 Interest Rate 30 2.2.2 Default Rate 30 2.2.3 Interest Calculation 31 2.2.4 Usury Savings 31 2.2.5 Breakage Indemnity 31 Section 2.3 Loan Payments 31 2.3.1 Payments 31 2.3.2 Payments Generally 32 2.3.3 Payment on Maturity Date 32 2.3.4 Late Payment Charge 32 2.3.5 Method and Place of Payment 32 2.3.6 Forwarding of Payments by Agent 33 2.3.7 Ratable Shares/Pro Raw Treatment of Payments 33 Section 2.4 Prepayments 33 2.4.1 Prepayments 33 2.4.2 Voluntary Prepayments 33 2.4.3 Mandatory Prepayments 33 2.4.4 Prepayments After Default 34 2.4.5 Prepayment/Repayment Conditions 34 Section 2.5 Release of Property 34 Section 2.6 Interest Rate Cap Agreement 35 2.6.1 Interest Rate Cap Agreement 35 2.6.2 Pledge and Collateral Assignment 35 2.6.3 Covenants 36 2.6.4 Powers of Borrower Prior to an Event of Default 38 2.6.5 Representations and Warranties 38 2.6.6 Payments 38 2.6.7 Remedies 39 2.6.8 Sales of Rate Cap Collateral 40 2.6.9 Public Sales Not Possible 41 2.6.10 Receipt of Sale Proceeds 41 63153399 EFTA00797689  Page 2.6.11 Replacement Interest Rate Cap Agreement 41 Section 2.7 Extension Options 41 2.7.1 Extension Options 41 2.7.2 Extension Documentation 43 Section 2.8 Spread Maintenance Premium 43 Section 2.9 Regulatory Change; Taxes 43 2.9.1 Increased Costs 44 2.9.2 Mitigation Obligations 44 Section 2.10 Earnout Advance 44 2.10.1 Conditions Precedent. 44 2.10.2 Optional Disbursements 45 ARTICLE 3 REPRESENTATIONS AND WARRANTIES 46 Section 3.1 Borrower's Representations 46 3.1.1 Organization; Special Purpose 46 3.1.2 Proceedings; Enforceability 46 3.1.3 No Conflicts 47 3.1.4 Litigation 47 3.1.5 Agreements 47 3.1.6 Consents 47 3.1.7 Property; Title 47 3.1.8 ERISA; No Plan Assets 48 3.1.9 Compliance 49 3.1.10 Financial Information 49 3.1.11 Easements; Utilities and Public Access 50 3.1.12 Assignment of Leases 50 3.1.13 Insurance 50 3.1.14 Flood Zone 50 3.1.15 Physical Condition 50 3.1.16 Boundaries 51 3.1.17 Leases 51 3.1.18 Tax Filings 51 3.1.19 No Fraudulent Transfer 51 3.1.20 Federal Reserve Regulations 52 3.1.21 Organizational Chart 52 3.1.22 Organizational Status 52 3.1.23 Bank Holding Company 52 3.1.24 No Casualty 52 3.1.25 Purchase Options 52 3.1.26 FIRPTA 52 3.1.27 Investment Company Act 52 3.1.28 Fiscal Year 52 3.1.29 Other Debt 52 3.1.30 Contracts 52 3.1.31 Full and Accurate Disclosure 53 3.1.32 Other Obligations and Liabilities 53 3.1.33 Intellectual Property/Websites 53 64153399 ii EFTA00797690  Page 3.1.34 Operations Agreements 53 3.1.35 Franchise Agreement 53 3.1.36 PIP Work 53 3.1.37 Illegal Activity 54 3.1.38 Securities Laws Compliance 54 Section 3.2 Survival of Representations 54 ARTICLE 4 BORROWER COVENANTS 54 Section 4.1 Payment and Performance of Obligations 54 Section 4.2 Due on Sale and Encumbrance; Transfers of Interests 54 Section 4.3 Liens 55 Section 4.4 Special Purpose 55 Section 4.5 Existence; Compliance with Legal Requirements 56 Section 4.6 Taxes and Other Charges 56 Section 4.7 Litigation 56 Section 4.8 Title to the Property 57 Section 4.9 Financial Reporting 57 4.9.1 Generally 57 4.9.2 Quarterly Reports 57 4.9.3 Annual Reports 58 4.9.4 Other Reports 59 4.9.5 Annual Budget 59 4.9.6 Extraordinary Operating Expenses 60 4.9.8 Access to Property 60 Section 4.10 Leases 60 4.10.1 Generally 60 4.10.2 Approvals 60 4.10.3 Covenants 60 4.10.4 Security Deposits 61 Section 4.11 Repairs; Maintenance and Compliance; Alterations 61 4.11.1 Repairs; Maintenance and Compliance 61 4.11.2 Alterations 61 Section 4.12 Approval of Major Contracts 62 Section 4.13 Property Management 62 4.13.1 Management Agreement 62 4.13.2 Prohibition Against Termination or Modification 62 4.13.3 Replacement of Manager 63 Section 4.14 Performance by Borrower; Compliance with Agreements 63 Section 4.15 Licenses; Intellectual Property; Website 63 4.15.1 Licenses 63 4.15.2 Intellectual Property 63 4.15.3 Website 64 Section 4.16 Further Assurances 64 Section 4.17 Estoppel Statement 64 Section 4.18 Notice of Default 65 Section 4.19 Cooperate in Legal Proceedings 65 Section 4.20 Indebtedness 65 63153399 iii EFTA00797691  Page Section 4.21 Business and Operations 65 Section 4.22 Dissolution 65 Section 4.23 Debt Cancellation 65 Section 4.24 Affiliate Transactions 66 Section 4.25 No Joint Assessment 66 Section 4.26 Principal Place of Business 66 Section 4.27 Change of Name, Identity or Structure 66 Section 4.28 Costs and Expenses 66 Section 4.29 Indemnity 67 Section 4.30 ERISA 68 Section 4.31 Patriot Act Compliance 69 Section 4.32 Hotel Covenants 70 Section 4.33 Construction Covenants 72 Section 4.34 Punchlist Work 72 ARTICLE 5 INSURANCE, CASUALTY AND CONDEMNATION 72 Section 5.1 Insurance 72 5.1.1 Insurance Policies 72 5.1.2 Insurance Company 77 Section 5.2 Casualty 78 Section 5.3 Condemnation 78 Section 5.4 Restoration 79 ARTICLE 6 CASH MANAGEMENT AND RESERVE FUNDS 84 Section 6.1 Cash Management Arrangements 84 Section 6.2 Tax Funds 85 6.2.1 Deposits of Tax Funds 85 6.2.2 Release of Tax Funds 85 Section 6.3 Insurance Funds 85 6.3.1 Deposits of Insurance Funds 85 6.3.2 Release of Insurance Funds 86 6.3.3 Acceptable Blanket Policy 86 Section 6.4 Seasonal Working Capital Reserve 86 6.4.1 Deposit of Seasonal Working Capital Funds 86 6.4.2 Release of Seasonal Working Capital Funds 86 Section 6.5 FF&E Reserve Funds; Capital Expenditure Funds 87 6.5.1 Deposits of FF&E Reserve Funds 87 6.5.2 Release of FF&E Reserve Funds 87 6.5.3 Deposits of Capital Expenditure Funds 88 6.5.4 Release of Capital Expenditure Funds 88 Section 6.6 Casualty and Condemnation Account 89 Section 6.7 Shortfall Reserve Funds 89 6.7.1 Deposit of Shortfall Reserve Funds 89 6.7.2 Release of Shortfall Reserve Funds 89 Section 6.8 Property Cash Flow Allocation 90 6.8.1 Order of Priority of Funds in Deposit Account 90 6.8.2 Failure to Make Payments 91 63153399 iv EFTA00797692  Page 6.8.3 Application After Event of Default 91 Section 6.9 Security Interest in Reserve Funds 91 ARTICLE 7 PERMITTED TRANSFERS 92 Section 7.1 Permitted Transfers 92 Section 7.2 Cost and Expenses; Searches; Copies 95 ARTICLE 8 DEFAULTS 96 Section 8.1 Events of Default 96 Section 8.2 Remedies 99 8.2.1 Acceleration 99 8.2.2 Remedies Cumulative 99 8.2.3 Severance 100 8.2.4 Agent's Right to Perform 101 ARTICLE 9 SALE AND SECURITIZATION OF MORTGAGE 101 Section 9.1 Sale of Mortgage and Securitization 101 Section 9.2 Securitization Indemnification 104 Section 9.3 Severance. 107 9.3.1 Severance Documentation 107 9.3.2 New Mezzanine Loan Option 108 9.3.3 Cooperation; Execution; Delivery 108 Section 9.4 Costs and Expenses 109 ARTICLE 10 MISCELLANEOUS 109 Section 10.1 Exculpation 109 Section 10.2 Survival; Successors and Assigns 113 Section 10.3 Agent's Discretion; Rating Agency Review Waiver 113 Section 10.4 Governing Law 114 Section 10.5 Modification, Waiver in Writing 115 Section 10.6 Notices 115 Section 10.7 Waiver of Trial by Jury 117 Section 10.8 Headings, Schedules and Exhibits 117 Section 10.9 Severability 117 Section 10.10 Preferences 118 Section 10.11 Waiver of Notice 118 Section 10.12 Remedies of Borrower 118 Section 10.13 Offsets, Counterclaims and Defenses 118 Section 10.14 No Joint Venture or Partnership; No Third Party Beneficiaries 118 Section 10.15 Publicity 119 Section 10.16 Waiver of Marshalling of Assets 119 Section 10.17 Certain Waivers 119 Section 10.18 Conflict; Construction of Documents; Reliance 119 Section 10.19 Brokers and Financial Advisors 120 Section 10.20 Prior Agreements 120 Section 10.21 Servicer 120 Section 10.22 Joint and Several Liability 121 63153399 V EFTA00797693  Page Section 10.23 Creation of Security Interest 121 Section 10.25 Counterparts 125 Section 10.26 Set-Off 125 Section 10.27 Modification, Waiver in Writing; Approvals 125 Section 10.28 Acknowledgement and Consent to Bail-In of EEA Financial Institutions 126 Section 10.29 Assignments and Participations 127 Section 10.30 Future Funding Obligations 128 ARTICLE 11 AGENT 129 Section 11.1 Appointment 129 Section 11.2 Delegation of Duties 130 Section 11.3 Exculpatory Provisions 130 Section 11.4 Reliance by Agent 130 Section 11.5 Notice of Default 131 Section 11.6 Non-Reliance on Agent and Other Lenders 131 Section 11.7 Indemnification 132 Section 11.8 Agent in Its Individual Capacity 132 Section 11.9 Appraisals 132 Section 11.10 Ratable Share 132 Section 11.11 Letters of Credit 133 Section 11.12 Co-Lenders 133 Section 11.13 Modifications to Article 11 133 64153399 vi EFTA00797694 Schedules and Exhibits Schedules: Schedule I - Organization of Borrower Schedule II - Exceptions to Representations and Warranties Schedule III - Ratable Share Schedule IV - Intellectual Property/Websites Schedule V - Definition of Special Purpose Bankruptcy Remote Entity Schedule VI - REA Schedule VII - Credit Card Company Payment Direction Letter Schedule VIII - Earnout Advance Funding Notice Schedule IX - Renovations Budget Schedule X - Project Loan Budget Schedule XI - Punchlist Budget Exhibits: Exhibit A - Legal Description Exhibit B - Secondary Market Transaction Information Exhibit C - Compliance Certificates Exhibit D - Architect's Certificate 64153399 vii EFTA00797695  AMENDED RESTATED AND CONSOLIDATED LOAN AGREEMENT THIS AMENDED RESTATED AND CONSOLIDATED LOAN AGREEMENT, dated as of July 18, 2017 (as amended, restated, replaced, supplemented or otherwise modified from time to time, this "Agreement"), by and among DEUTSCHE BANK AG, NEW YORK BRANCH, a branch of Deutsche Bank AG, a German Bank, authorized by the New York Department of Financial Services ("DB"), having an address at 60 Wall Street, 10th Floor, New York, New York 10005 (together with its successors and permitted assigns hereunder, including any Assignee (as defined herein) hereunder and such other co-lenders as may exist from time to time under this Agreement, each a "Lender" and collectively, the "Lenders"), DB, as administrative agent (including any of its successors and assigns hereunder, "Agent") for itself and the other Lenders party hereto from time to time, and LIFE HOTEL ONE LLC, a Delaware limited liability company having an address at do Mitchell Holdings, 801 Madison Avenue, 4th Floor, New York, New York, 10065 ("Borrower"). All capitalized terms used herein shall have the respective meanings set forth in Article 1 hereof. WITNESSETH: WHEREAS, on June 3, 2016 (the "Original Closing Date"), Agent, Lenders and Borrower entered into (a) that certain Senior Loan Agreement (the "Original Senior Loan Agreement") pursuant to which Lenders agreed to make a senior mortgage loan to Borrower in the maximum principal amount of $28,249,397.76 (the "Original Senior Loan"), which Original Senior Loan was evidenced by, among other things, that certain Amended and Restated Senior Promissory Note dated as of the Original Closing Date in the original principal amount of $28,249,397.76 made by Borrower and payable to Agent (the "Original Senior Note"), (b) that certain Building Loan Agreement (the "Original Building Loan Agreement") pursuant to which Lenders agreed to make a building loan to Borrower in the maximum principal amount of up to $6,475,075.51 (the "Original Building Loan"), which Original Building Loan was evidenced by, among other things, that certain Building Loan Promissory Note dated as of the Original Closing Date in the maximum principal amount of up to $6,475,075.51 made by Borrower and payable to Agent (the "Original Building Note"), and (c) that certain Project Loan Agreement (the "Original Project Loan Agreement") pursuant to which Lenders agreed to make a project loan to Borrower in the maximum principal amount of up to $1,275,526.73 (the "Original Project Loan"), which Original Project Loan was evidenced by, among other things, that certain Project Loan Promissory Note dated as of the Original Closing Date in the maximum principal amount of up to $1,275,526.73 made by Borrower and payable to Agent (the "Original Project Note"). WHEREAS, prior to the date hereof, the Original Building Loan has been fully advanced to Borrower in accordance with the terms of the Original Building Loan Agreement and the Original Project Loan has been fully advanced to Borrower in accordance with the terms of the Original Project Loan Agreement. WHEREAS, simultaneously with the execution and delivery of this Agreement, Lenders are advancing additional loan proceeds in the amount of $5,000,000.00 (the "Supplemental Loan") to Borrower, which Supplemental Loan shall be evidenced by that certain Gap Promissory Note executed by Borrower for the benefit of Agent (the "Supplemental Note"). 64153399 EFTA00797696 Agent, Lenders and Borrower have agreed to consolidate the Original Senior Loan, the Original Building Loan, the Original Project Loan and the Supplemental Loan into one mortgage loan in the maximum principal amount of up to $41,000,000.00 (the "Loan"). In furtherance of the foregoing, Agent, Lenders and Borrower have agreed to (x) amend, restate and consolidate the terms of the Original Senior Loan Agreement, the Original Building Loan Agreement and Original Project Loan Agreement in their entirety as set forth herein and (y) amend, restate and consolidate the terms of the Original Senior Note, the Original Building Note, the Original Project Note and the Supplemental Note in their entirety as set forth in that certain Amended, Restated and Consolidated Promissory Note in the maximum principal amount of up to $41,000,000.00 (as the same may hereafter be amended, supplemented, restated, increased, extended or consolidated from time to time, the "Note"); NOW, THEREFORE, in consideration of the premises and the covenants, agreements, representations and warranties set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree that the Original Loan Agreement, the Original Building than Agreement and the Original Project than Agreement are hereby amended, restated and consolidated in their entirety as follows: ARTICLE 1 DEFINITIONS; PRINCIPLES OF CONSTRUCTION Section 1.1 Specific Definitions. For all purposes of this Agreement, except as otherwise expressly provided: "Acknowledgment' shall mean the Acknowledgment, dated on or about the date hereof made by Counterparty, or if applicable, an Acknowledgment to be delivered in connection with a Replacement Interest Rate Cap Agreement by an Approved Counterparty. "Advance" shall mean the any advance of principal made pursuant to this Agreement, including the Earn-Out Advance made pursuant to Section 2.10 hereof. "Affiliate" shall mean, as to any Person, any other Person that (i) owns directly or indirectly ten percent (10%) or more of all equity interests in such Person, and/or (ii) is in Control of, is Controlled by or is under common ownership or Control with such Person, and/or (iii) is a director or officer of such Person or of an Affiliate of such Person, and/or (iv) is the spouse, issue or parent of such Person or of an Affiliate of such Person. "ALTA" shall mean American Land Title Association, or any successor thereto. "Alteration Threshold" shall mean one percent (1%) of the Outstanding Principal Balance. "Amendment to Loan Documents" that certain Omnibus Amendment to than Documents dated as of the date hereof and entered into by and among Agent, Lenders, Borrower and Operating Lessee. 6415339') 2 EFTA00797697  "Annual Budget" shall mean the operating and capital budget for the Property setting forth, on a month-by-month basis, in reasonable detail, each line item of Borrower's good faith estimate of anticipated Operating Income, Operating Expenses, FF&E Expenditures and Capital Expenditures for the applicable Fiscal Year. "Approved Capital Expenditures" shall mean the Capital Expenditures incurred by Borrower in connection with the Punchlist Work and either (i) included in the Punchlist Budget or (ii) approved by Agent, which approval shall not be unreasonably withheld or delayed. "Approved Counterparty" shall mean a bank or other financial institution which has (a) a long-term unsecured debt rating of "A" or higher by S&P; (b) a long-term unsecured debt rating of not less than "A2" by Moody's; and (c) if the counterparty is rated by Fitch, a long-term unsecured debt rating of "A" or higher by Fitch and a short-term unsecured debt rating of not less than "F-1" from Fitch; provided however that SMBC Capital Markets, Inc. (with an Acceptable SMBC Credit Support Party as its credit support party) will be an Acceptable Counterparty so long as the rating of its credit support party (provided such credit support party shall be an Acceptable SMBC Credit Support Party) is not downgraded, withdrawn or qualified by S&P or Moody's or Fitch from the long and short term ratings issued by such rating agencies below the lesser of the above rating (as applicable) or its ratings as of the date hereof. As used herein, an "Acceptable SMBC Credit Support Party" shall mean (i) Sumitomo Mitsui Banking Corporation or a replacement guarantor that meets the foregoing rating requirements and provides a guaranty on substantially the same form as the guaranty provided by Sumitomo Mitsui Banking Corporation on the Closing Date and (ii) provided any such credit support party guaranty guaranties all current and future obligations under the Interest Rate Cap Agreement or Replacement Interest Rate Cap Agreement, as applicable. "Approved FF&E Expenditures" shall mean the cost of FF&E Expenditures incurred by Borrower and either (i) included in the Approved Annual Budget or (ii) approved by Agent, which approval shall not be unreasonably withheld or delayed. "Approved Replacement Guarantor" shall mean a Person (i) that satisfies the conditions set forth in clauses (x) and (y) of the definition of "Qualified Transferee", (ii) is formed in (or, if such Person is an individual, is a citizen of), maintains its principal place of business in (or, if such Person is an individual, maintains a primary residence in), and is subject to service in the United States or Canada, (iii) has all or substantially all of its assets in the United States or Canada, (iv) whose identity, experience, financial condition and creditworthiness, including net worth and liquidity, is acceptable to Agent in Agent's sole discretion, and, if the Loan has been included in a Securitization, for which Agent has received a Rating Agency Confirmation from each applicable Rating Agency and (v) who either Controls Borrower (or any Transferee Borrower, as applicable) and owns a direct or indirect interest in Borrower (or any Transferee Borrower, as applicable). If two or more Approved Replacement Guarantors are delivering replacement guaranties and replacement environmental indemnities to Agent (on behalf of Lenders), then (1) only one such Approved Replacement Guarantor must Control Borrower (or any Transferee Borrower, as applicable), directly or indirectly (provided that each such Approved Replacement Guarantor must own a direct or indirect interest in Borrowers (or any Transferee Borrower, as applicable)) and (2) the obligations of all Approved Replacement Guarantors shall be joint and several. 64153399 3 EFTA00797698  "Assignment of Agreements" shall mean that certain Assignment of Agreements, Licenses, Permits and Contracts, dated as of the Original Closing Date, from Borrower, as assignor, to Agent (on behalf of Lenders), as assignee, as amended by that certain Amendment to Loan Documents. "Assignment of Leases" shall mean that certain Amended and Restated Assignment of Leases and Rents, dated as of the date hereof, from Borrower, as assignor, to Agent (on behalf of Lenders), as assignee. "Assignment of Management Agreement" shall mean that certain Assignment of Management Agreement and Subordination of Management Fees dated as of the Original Closing Date, among Borrower, Manager and Agent (on behalf of Lenders), as amended by that certain Amendment to Loan Documents. "Award" shall mean any compensation paid by any Governmental Authority in connection with a Condemnation in respect to all or any part of the Property. "Bankruptcy Code" shall mean Title 11 of the United States Code entitled "Bankruptcy", as amended from time to time, and any successor statute or statutes and all rules and regulations from time to time promulgated thereunder, and any comparable foreign laws relating to bankruptcy, insolvency or creditors' rights. "Borrower Related Party" means, collectively and individually, Borrower, any Guarantor and any Affiliate of any of the foregoing, and any officer, director, employee or immediate family member of the foregoing, and any Person acting at the direction of any of the foregoing; provided that the following Persons shall not be considered "Borrower Related Parties": Persons that (a) do not have any authority to bind a Person that is otherwise a Borrower Related Party, and (b) do not own any direct and/or indirect ownership interest in a Borrower, in each case, so long as Borrower and/or one or both of the Guarantors is contesting and/or actively remediating the action by such Persons, and, in the case of any such Persons who are employees of any Borrower Related Party, Borrower and/or Guarantors have terminated (or caused the termination of) such employee for cause. "Borrower's Architect" shall mean the architect to be selected by Borrower and approved by Agent. "Business Day" shall mean any day other than a Saturday, a Sunday or a legal holiday on which national banks are not open for general business in (i) the State of New York, (ii) the state where the corporate trust office of the Trustee is located, or (iii) the state where the servicing offices of the Servicer are located. "Calculation Date" shall mean the last day of each calendar quarter. "Capital Expenditures" for any period shall mean amounts expended for replacements and alterations to the Property (excluding tenant improvements) and required to be capitalized according to GAAP. 64153399 4 EFTA00797699  "Cash Management Agreement' shall mean that certain Cash Management Agreement dated as of June 3, 2016 among Agent (on behalf of Lenders), Borrower, Operating Lessee, Deutsche Bank Trust Company Americas and Manager, as amended by the Amendment to Loan Documents. "Clearing Account Agreement" shall mean that certain Deposit Account Control Agreement dated as of the Original Closing Date, by and among Borrower, Agent (on behalf of Lenders), Manager and Wells Fargo Bank, National Association, as amended by that certain Amendment to Loan Documents. "Closing Date" shall mean the date of the funding of the Initial Advance of the Supplemental Loan. "Code" shall mean the Internal Revenue Code of 1986, as amended, and as it may be further amended from time to time, any successor statutes thereto, and applicable U.S. Department of Treasury regulations issued pursuant thereto in temporary or final form. "Collateral Assignment of IRPA" shall mean that certain Collateral Assignment of Interest Rate Protection Agreement made by Borrower for the benefit of Agent (on behalf of Lenders) as amended by the Amendment to Loan Documents. "Completion Guaranty" shall mean that certain Guaranty of Completion of even date herewith from Guarantors for the benefit of Agent (on behalf of Lenders). "Condemnation" shall mean a temporary or permanent taking by any Governmental Authority as the result or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain, of all or any part of the Property, or any interest therein or right accruing thereto, including any right of access thereto or any change of grade affecting the Property or any part thereof. "Connection Income Taxes" means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes. "Control" shall mean, with respect to any Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, through the ownership of voting securities, by contract or otherwise, and the terms Controlled, Controlling and Common Control shall have correlative meanings. "Counterparty" shall mean, with respect to the Interest Rate Cap Agreement, Commonwealth Bank of Australia, and with respect to any Replacement Interest Rate Cap Agreement, any Approved Counterparty thereunder. "Debt" shall mean the Outstanding Principal Balance together with all interest accrued and unpaid thereon and all other sums (including the Spread Maintenance Premium, if applicable) due to Lenders from time to time in respect of the Loan under the Note, this Agreement, the Mortgage, the Environmental Indemnity or any other Loan Document. 64153399 5 EFTA00797700  "Debt Service" shall mean, with respect to any particular period, the scheduled interest payments due under the Note and, if applicable, the note(s) evidencing any New Mezzanine Loan in such period. "Debt Yield" shall mean, for any date, as determined by Agent in Agent's sole discretion, the percentage obtained by dividing the Underwritten Net Cash Flow as of such date by the Maximum Principal Amount as of such date. "Default" shall mean the occurrence of any event hereunder or under any other Loan Document which, but for the giving of notice or passage of time, or both, would constitute an Event of Default. "Default Rate" shall mean, with respect to the Loan, a rate per annum equal to the lesser of (i) the Maximum Legal Rate or (ii) five percent (5%) above the Interest Rate. "Deposit Account" shall mean an Eligible Account at the Deposit Bank. "Deposit Bank" shall mean the bank or banks selected by Agent to maintain the Deposit Account. Agent may in its sole discretion change the Deposit Bank from time to time. "Earnout Advance" shall mean a one-time advance of principal in the amount of $1,000,000 made pursuant to Section 2.10 hereof. "Eligible Account" shall mean a separate and identifiable account from all other funds held by the holding institution that is either (i) an account or accounts (or subaccounts thereof) maintained with a federal or state-chartered depository institution or trust company which complies with the definition of Eligible Institution or (ii) a segregated trust account or accounts (or subaccounts thereof) maintained with the corporate trust department of a federal depository institution or state chartered depository institution subject to regulations regarding fiduciary funds on deposit similar to Title 12 of the Code of Federal Regulations §9.10(b), having in either case corporate trust powers, acting in its fiduciary capacity, and a combined capital and surplus of at least $50,000,000, subject to supervision or examination by federal and state authorities and having a long-term unsecured debt rating of "BBB-" or higher by S&P and "A2" or higher by Moody's and a short-term unsecured debt rating of "A-I" or higher by S&P and "P-1" or higher by Moody's. An Eligible Account will not be evidenced by a certificate of deposit, passbook or other instrument. "Eligible Assignee" shall mean any of (i) DB, or any Person Controlled by or under common Control with DB, or (ii) one or more of the following: (A) a real estate investment trust, bank, saving and loan association, investment bank, insurance company, trust company, commercial credit corporation, pension plan, pension fund or pension advisory firm, mutual fund, government entity or plan, provided that any such Person referred to in this clause (ii)(A) satisfies the Eligibility Requirements; (B) an investment company, money management firm or "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act of 1933, as 63153399 6 EFTA00797701  amended, or an institutional "accredited investor" within the meaning of Regulation D under the Securities Act of 1933, as amended, provided that any such Person referred to in this clause (ii)(B) satisfies the Eligibility Requirements; (C) an investment fund, limited liability company, limited partnership, general partnership , corporation, trust or similar entity or investment vehicle where a Permitted Fund Manager acts as general partner, managing member or, directly or indirectly, as a fund manager, investment manager, asset manager, collateral manager or otherwise acts in a similar management capacity and at least fifty percent (50%) of the equity interests in such investment vehicle are owned, directly or indirectly, by one or more of the following: a Person that is otherwise an Eligible Assignee under the other clauses of this definition, an institutional "accredited investor" within the meaning of Regulation D promulgated under the Securities Act of 1933, as amended, and/or a "qualified institutional buyer" within the meaning of Rule 144A promulgated under the Securities Exchange Act of 1934, as amended, provided such institutional "accredited investors" or "qualified institutional buyers" that are used to satisfy the fifty percent (50%) test set forth above in this clause (ii)(C) each satisfies the Eligibility Requirements; (D) an institution substantially similar to any of the foregoing entities described in clause (ii)(A), clause (ii)(B) or clause (ii)(C) of this definition that satisfies the Eligibility Requirements; or (E) any Person Controlled or managed by or under common Control or management with any of the Persons described in the foregoing clauses (A), (B), (C), and (D). "Eligible Institution" shall mean a depository institution or trust company insured by the Federal Deposit Insurance Corporation the short term unsecured debt obligations or commercial paper of which are rated at least "A-1" by S&P, "P-1" by Moody's and "F-1" by Fitch (and the long term unsecured debt obligations of such depository institution are rated at least "A" by Fitch) in the case of accounts in which funds are held for thirty (30) days or less or, in the case of accounts in which funds are held for more than thirty (30) days, the long term unsecured debt obligations of which are rated at least (i) "A" by S&P, (ii) "A" by Fitch (and the short term deposits or short term unsecured debt obligations or commercial paper of such depository institution are rated no less than "Fl" by Fitch), and (iii) "A2" by Moody's, or in the case of Letters of Credit, the long term unsecured debt obligations of which are rated at least (i) "A+" by S&P, (ii) "A+" by Fitch (and the short term deposits or short term unsecured debt obligations or commercial paper of such depository institution are rated no less than "Fl" by Fitch) and (iii) "Al" by Moody's; provided, however, for purposes of the Deposit Bank, the definition of Eligible Institution shall have the meaning set forth in the Cash Management Agreement. "Eligibility Requirements" shall mean, with respect to any Person, that such Person has capital/statutory surplus or shareholders' equity of at least $25,000,000.00 and assets (in name or under management) of at least $100,000,000.00. "Environmental Indemnity" shall mean that certain Environmental Indemnity Agreement dated as of June 3, 2016, executed by Borrower, Operating Lessee and Guarantors in 64153399 7 EFTA00797702 connection with the Loan for the benefit of Agent (for itself and on behalf of Lenders), as amended by the Amendment to Loan Documents. "ERISA Affiliate" shall mean any trade or business (whether or not incorporated) which is a member of the same controlled group of corporations or group of trades or businesses under common control with Borrower or the Guarantors (or any Guarantor), or is treated as a single employer together with Borrower or the Guarantors (or any Guarantor) under Section 414 of the Code or Title IV of ERISA. "Excluded Taxes" shall mean any of the following Special Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Special Taxes imposed on or measured by net income (however denominated), franchise taxes, and branch profits taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Special Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.9, amounts with respect to such Special Taxes were payable either to such Lender's assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Special Taxes attributable to such Recipient's failure to comply with Section 10.24 and (d) any U.S. withholding Special Taxes imposed under or in connection with FATCA. "Extension Fee" shall mean a non-refundable fee equal to 0.50% of the Maximum Principal Amount in connection with Borrower's exercise of an Extension Option and payable one (1) Business Day prior to the first day of the applicable extension term of the Loan. "Extension Option" shall mean the First Extension Option or the Second Extension Option, as applicable. "FF&E" shall mean fixtures, furnishings, equipment, furniture, and other items of tangible personal property now or hereafter located in or on the Property or the Improvements or used in connection with the use, occupancy, operation and maintenance of all or any part of the hotel located on the Property, other than Inventory and stocks of food and other supplies held for consumption in normal operation but including, without limitation, appliances, machinery, equipment, signs, artwork, office furnishings and equipment, guest room furnishings, and specialized equipment for kitchens, laundries, bars, restaurant, public rooms, health and recreational facilities, linens, dishware, all partitions, screens, awnings, shades, blinds, floor coverings, hall and lobby equipment, heating, lighting, plumbing, ventilating, refrigerating, incinerating, elevators, escalators, air conditioning and communication plants or systems with appurtenant fixtures, vacuum cleaning systems, call or beeper systems, security systems, sprinkler systems and other fire prevention and extinguishing apparatus and materials; reservation system computer and related equipment; all equipment, manual, mechanical or motorized, for the construction, maintenance, repair and cleaning of, parking areas, walks, 63153399 8 EFTA00797703 underground ways, truck ways, driveways, common areas, roadways, highways and streets; and the Vehicles (as defined in the Uniform System of Accounts for Hotels, current edition). "FF&E Expenditure" for any period shall mean the amount expended for FF&E Work in, at or to the Property. "Final Completion" shall mean that (a) the PIP Work (including all "punch list items") shall be complete in acco