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Joint Escrow Instructions

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Title:

Joint Escrow Instructions

Entities:

Capital Lodging

Date:

2004

Size:

Preview shows 67KB of 298KB total

Price:

$89

ID:

#1459336

► Miscellany ► Documents ► Instructions ► Escrow ► Joint Escrow Instructions

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CONTRIBUTION AGREEMENT

FOR

APOLLO HOTEL PORTFOLIO

AND

JOINT ESCROW INSTRUCTIONS

TABLE OF CONTENTS


			Page
1.	Definitions		2
	1.1	General	2
	1.2	Other Definitions	14
2.	Contribution of Hotels		15
	2.1	Exclusion of Certain Service Contracts and Equipment Lease(s)	15
3.	Contribution Consideration; Allocation		15
	3.1	Contribution Consideration	15
	3.2	Allocation of Contribution Consideration	15
4.	Title and Due Diligence Matters		16
	4.1	Property Records and Title Documents	16
	4.2	Survey	16
	4.3	Estoppels and Consents	16
	4.4	Removal of Liens	16
	4.5	Access to Property and Records	16
	4.6	Indemnification	17
5.	Representations and Warranties		17
	5.1	By Contributors	17
	5.2	By the Companies	27
	5.3	Notice of Subsequent Event or Discovery	29
6.	Operation of the Hotels Pending Closing		29
7.	Other Agreements		30
	7.1	Liquor License(s) and Inventory	30
	7.2	Estoppel Certificates; Consents	31
	7.3	2004 Interim Financial Statements	32
	7.4	Further Assurances	32
	7.5	Government Approvals and Third Party Consents	32
	7.6	Exclusivity	32
	7.7	The Companies Release of Contributors	33
	7.8	Hotel Records	33
8.	Prorations, Credits and Other Adjustments		34

TABLE OF CONTENTS

(continued)


			Page
	8.1	Proration of Taxes	34
	8.2	Proration of Expenses	34
	8.3	Hotel Revenues	35
	8.4	Hotel Payables	35
	8.5	Other Credits to the Companies	36
	8.6	Other Credits to Contributors	36
	8.7	Regarding Hotel Prorations Generally	37
	8.8	Preliminary Closing Statement	37
	8.9	Utility Deposits; Loan Impounds and Debt Service	37
9.	Conditions to Closing		37
	9.1	In the Companies Favor	37
	9.2	In Contributors Favor	39
	9.3	Pre-Closing Damage or Destruction	40
10.	Closing		42
	10.1	Closing Date; Location	42
	10.2	Pro Forma Title Policies	42
	10.3	Contributors Deliveries	42
	10.4	The Companies Deliveries	43
	10.5	Closing Costs	44
	10.6	Completion of Closing	45
	10.7	Escrow and Recording Instructions	46
	10.8	Delivery of Possession	46
	10.9	Procedure for Termination of Escrow	46
	10.10	Maintenance of Confidentiality by Escrow Agent	47
11.	Post-Closing Adjustments		47
	11.1	Final Closing Statement	47
	11.2	Disputes	47
	11.3	Settlement	48
	11.4	Subsequent Tax Bills	48
12.	Third-Party Claims and Obligations		48

TABLE OF CONTENTS

(continued)


			Page
	12.1	Assumed and Retained Liabilities	48
	12.2	Employee Liabilities	48
	12.3	WARN Act Liability	49
13.	Indemnification		49
	13.1	Indemnification; Survival	49
	13.2	Third-Party Claims and Obligations	49
	13.3	Limitation on Indemnification	52
14.	Termination		53
15.	Assignment		54
16.	Notices		54
17.	General Provisions		55
	17.1	Confidentiality	55
	17.2	Effect of Termination	56
	17.3	Construction; Participation in Drafting	56
	17.4	No Third-Party Beneficiaries	56
	17.5	Survival of Provisions	57
	17.6	Integration and Binding Effect	57
	17.7	Computation of Time	57
	17.8	Captions	57
	17.9	Further Assurances	57
	17.10	Governing Law	57
	17.11	Counterparts	57

iii

SCHEDULES AND EXHIBITS

Exhibits


Exhibit A		Form of Asset Management Agreement
Exhibit B		Schedule of Contracts
Exhibit C		Form of Bill of Sale
Exhibit D		Form of Agreement of Assignment and Assumption of Assumed Contracts
Exhibit E		Form of Contributors Closing Certificate
Exhibit F		Form of Deeds
Exhibit G		Form of FIRPTA Certificate
Exhibit H		Form of General Assignment and Assumption Agreement
Exhibit I		Form of Ground Lease Assignment and Consents
Exhibit J		Ground Leases
Exhibit K		Hotel Parcels
Exhibit L		Hotel Properties
Exhibit M		Form of Agreement for Assignment and Assumption of Offsite Rights
Exhibit N		Survey of Each Hotel Parcel
Exhibit O		Form of Tenant Estoppel Certificate
Exhibit P		Form of Tenant Leases Assignment
Exhibit Q		Form of Ground Lease Estoppel Certificate
Exhibit R		Form of Notice to Tenant of Contribution of Hotel (Lease)

Schedules

Schedule 3.2

Schedule

5.1(a)

Schedule

5.1(c)

Schedule

5.1(e)

Schedule

5.1(f)

Schedule

5.1(g)

Schedule

5.1(h)

Schedule

5.1(i)(3)

Schedule

5.1(i)(6)

Schedule

5.1(j)

Schedule

5.1(k)

Schedule

5.1(l)

Schedule

5.1(m)(1)

Schedule

5.1(m)(2)

Schedule

5.1(n)

Schedule

5.1(o)

Schedule

5.1(p)

Schedule

5.1(q)

Schedule

5.1(r)

Schedule

5.1(s)(8)

Schedule

5.1(s)(10)

Schedule 5.1(t)

Schedule 5.1(u)

Schedule 5.1(v)(1)

Schedule 5.1(v)(3)

Schedule 5.1(v)(10)

Schedule 5.2(d)

Schedule 10.3

CONTRIBUTION AGREEMENT

FOR

APOLLO HOTEL PORTFOLIO

AND

JOINT ESCROW INSTRUCTIONS

THIS CONTRIBUTION AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this Agreement) is made as of , 2004 by and among AP/APH Ventures, LLC, a Delaware limited liability company (Ventures LLC), AP/APMC Stockton, L.P., a Delaware limited partnership (Stockton LP), AP/APH San Antonio, L.P., a Delaware limited partnership (San Antonio LP), AP/APH Branson, L.P., a Delaware limited partnership (Branson LP), AP/APH Tallahassee, L.P., a Delaware limited partnership (Tallahassee LP), AP/APH Dallas, L.P., a Delaware limited partnership (Dallas LP), AP/APH Palm Springs, L.P., a Delaware limited partnership (Palm Springs LP). Ventures LLC, Stockton LP, San Antonio LP, Branson LP, Tallahassee LP, Dallas LP and Palm Springs LP are collectively referred to herein as the Contributors,

and

Capital Lodging, a Maryland real estate investment trust (the REIT) and Capital Lodging, L.P., a Delaware limited partnership (the Operating Partnership, and, together with Capital Lodging, the Companies). References to the Operating Partnership shall be deemed to include any designee or nominee thereof.

WHEREAS, the Contributors collectively own or hold subject to Ground Leases each of the Hotels;

WHEREAS, Contributors desire to contribute and the Operating Partnership desires to accept the contribution of the Hotels;

WHEREAS, the Parties intend that the Closing under this Agreement occur simultaneously with the REIT IPO Closing and that a portion of the net proceeds received by the REIT in the REIT IPO be used to repay approximately $136.1 million of cross collateralized indebtedness associated with the Hotels and certain other hotels held by Affiliates of the Contributors, and the REIT shall issue to the Contributors its common shares in an amount described herein in exchange for the contribution of the Hotels;

WHEREAS, simultaneously with the REIT IPO Closing, the Operating Partnership and Ventures LLC shall enter into the Asset Management Agreement; and

WHEREAS, the respective governing bodies of each of the Contributors and the Companies deem it advisable and in the best interests of such persons and their respective

shareholders, partners, members and beneficiaries, respectively, that the Parties effect the transactions herein described.

NOW, THEREFORE, IN CONSIDERATION OF the mutual covenants and conditions contained herein, the parties hereto (together, the Parties and each, sometimes, a Party) do hereby agree and covenant with each other as follows:

1.	Definitions.

1.1 General. As used in this Agreement, the following defined terms shall have the meanings indicated below:

Account means any account receivable outstanding as of Closing for any Hotel; and the Accounts means all such accounts receivable.

Actions means all actions, claims, suits, litigation, proceedings, labor disputes, arbitral actions, governmental audits, inquiries, criminal prosecutions, investigations or unfair labor practice charges or complaints.

Affiliate means, with respect to an indicated person, any other person who directly or indirectly controls, is controlled by or is under common control with such indicated person.

Asset Management Agreement means that certain Asset Management Agreement by and between the Operating Partnership and Ventures LLC, in substantially the form attached hereto as Exhibit A.

Assumed Contracts means (i) the Contracts identified on the Schedule of Contracts attached hereto as Exhibit B, including any amendments thereto or replacements thereof entered into in accordance with this Agreement and (ii) Minor Contracts, in each case other than Excluded Contracts.

Bill of Sale means an instrument, substantively in the form attached hereto as Exhibit C, for conveyance of the FF&E and Inventory to the Operating Partnership.

Breakage Costs means any fees, costs, charges or penalties payable by the Contributors on account of the early repayment of any indebtedness for borrowed money that is secured by any Hotel Premises (each a Secured Loan).

Business Day means a Day other than Saturday, Sunday or other Day when commercial banks in the State of New York are authorized or required by Law to close.

Cash Bank means, with respect to each Hotel, cash of a Contributor on hand in house banks and petty cash on hand of a Contributor as of Closing.

Casualty has the meaning specified in Section 9.3(b).

Claim means any claim, demand, liability, legal action or proceeding, investigation, fine or other penalty, and loss, cost or expense related thereto (including, without limitation, attorneys fees and disbursements actually and reasonably incurred).

Closing means the concurrent delivery (i) by the Contributors to the Companies of the Transfer Instruments, (ii) by the Companies to the Contributors of the Contribution Consideration, and (iii) by the Companies to the Escrow Agent any Transfer Instrument requiring the Companies signature, in accordance with this Agreement.

Closing Date has the meaning specified in Section 10.1.

Closing Documents means the Transfer Instruments, the FIRPTA Certificate, the Offsite Rights Consents and all the other documents to be delivered hereunder at, or for purposes of effecting, Closing.

COBRA means the Consolidated Omnibus Budget Reconciliation Act of 1985.

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