1021-00001 · Verimark Hospitality Group · Opinions

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OPINION BACKUP CERTIFICATE

of Verimark Hospitality Group Inc.

July 21, 2022

Delivered in connection with that certain Credit Agreement, dated as of July 21, 2022 (the "Credit Agreement"), among Verimark Hospitality Group Inc., a Delaware corporation (the "Borrower" or the "Company"), the Guarantors party thereto, Crescent Harbor Bank, N.A., as Administrative Agent and Collateral Agent (in such capacities, the "Administrative Agent" and the "Collateral Agent," respectively), and the Lenders from time to time party thereto, providing for a $700,000,000 Senior Secured Term Loan B facility (the "Term Loan B").

Addressee:

Calderwood & Harkness LLP One Liberty Plaza, 52nd Floor New York, New York 10006

Attention: Banking & Finance Practice Group

Purpose: This Certificate (this "Certificate") is delivered to Calderwood & Harkness LLP ("Counsel") in connection with Counsel's delivery of its legal opinions dated July 21, 2022 (the "Opinions") addressed to Crescent Harbor Bank, N.A. (in its capacity as Administrative Agent) and the Lenders under the Credit Agreement. The undersigned understands that Counsel is relying on the factual representations and statements set forth herein in rendering the Opinions, and the undersigned, on behalf of the Company, hereby authorizes such reliance. The undersigned further acknowledges that the Opinions are being delivered as a condition precedent to the effectiveness of the Credit Agreement and the initial funding of the Term Loan B on the date hereof.

Section 1. Defined Terms and Interpretive Provisions

1.1 Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement. As used in this Certificate, the following terms shall have the following meanings:

(a) The "Credit Agreement" means that certain Credit Agreement dated as of July 21, 2022, among the Borrower, the Guarantors party thereto, Crescent Harbor Bank, N.A., as Administrative Agent and Collateral Agent, and the Lenders from time to time party thereto.

(b) The "Loan Documents" means, collectively, the Credit Agreement, the Guarantee Agreement dated as of the date hereof (the "Guarantee Agreement"), the Pledge and Security Agreement dated as of the date hereof (the "Pledge and Security Agreement"), the Amended and Restated Intercreditor Agreement dated as of the date hereof among the Administrative Agent and the other secured parties identified therein (the "Intercreditor Agreement"), the Mortgages, the Promissory Notes, and all other documents, instruments, certificates, and agreements executed and delivered in connection therewith on or prior to the date hereof.

(c) The "Transaction" means, collectively, (i) the borrowing of $700,000,000 under the Term Loan B, (ii) the payoff and discharge in full of the existing $625,000,000 term loan facility (the "Existing Facility") with Greystone Federal Credit Corp. as administrative agent (the "Existing Agent"), (iii) the release of all liens and security interests securing the Existing Facility, and (iv) the related transactions contemplated by the Loan Documents, including the grant of liens and security interests in favor of the Collateral Agent, as more fully described in the Credit Agreement and the other Loan Documents.

(d) The "Guarantors" means, collectively, the following subsidiaries of the Company, each of which is a party to the Guarantee Agreement and the Pledge and Security Agreement:

(i) Verimark Resort Properties LLC, a limited liability company organized and existing under the laws of the State of Delaware;

(ii) VHG Management Services Inc., a corporation incorporated and existing under the laws of the State of Delaware;

(iii) Verimark Convention Holdings LLC, a limited liability company organized and existing under the laws of the State of Delaware;

(iv) Palmetto Beachfront Hotels LLC, a limited liability company organized and existing under the laws of the State of Florida; and

(v) Cascadia Hospitality Corp., a corporation incorporated and existing under the laws of the State of Delaware.

1.2 Unless the context otherwise requires, references herein to "Sections" are to sections of this Certificate, references to the "undersigned" are to Priya Narayanan in her capacity as General Counsel and Corporate Secretary of the Company, and the words "herein," "hereof," and "hereunder" refer to this Certificate as a whole. The use of the phrase "to the knowledge of the undersigned" or words of similar import means the actual knowledge of the undersigned after due inquiry and investigation of such officers and employees of the Company and its subsidiaries as the undersigned has deemed appropriate in connection with the preparation of this Certificate.

Section 2. Identity and Authority of the Certifying Officer

2.1 The undersigned is Priya Narayanan, General Counsel and Corporate Secretary of Verimark Hospitality Group Inc. The undersigned has served in the capacity of General Counsel since March 2019 and in the additional capacity of Corporate Secretary since January 2020. In such capacities, the undersigned is responsible for, among other things, the legal affairs of the Company and its subsidiaries, maintaining the corporate records and minute books of the Company, and overseeing compliance with the Company's organizational documents and applicable law.

2.2 The representations, certifications, and statements set forth in this Certificate are made based upon the personal knowledge of the undersigned and upon information and knowledge obtained through reasonable and diligent inquiry and investigation of the appropriate officers and employees of the Company and its subsidiaries, including, without limitation, Marcus Delvecchio (Chief Executive Officer), Renata Haines (Chief Financial Officer), Glenn Fischbach (Treasurer), and such other personnel as the undersigned has deemed necessary or appropriate. The undersigned has also reviewed or caused to be reviewed such corporate records, documents, agreements, certificates, and other instruments of the Company and its subsidiaries as the undersigned has deemed relevant to the matters addressed herein.

2.3 The undersigned is duly authorized to execute and deliver this Certificate on behalf of the Company pursuant to the resolutions of the Board of Directors of the Company referenced in Section 5 hereof and in her capacity as General Counsel and Corporate Secretary of the Company.

Section 3. Organization, Good Standing, and Qualification

3.1 The Company is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware. The Company was originally incorporated under the laws of the State of Delaware on September 14, 2016 and has been continuously in existence since that date. The Company's file number with the Secretary of State of the State of Delaware is 7291843. The Company's Employer Identification Number assigned by the Internal Revenue Service is 82-3741956. The Company's Restated Certificate of Incorporation, as amended, was most recently amended on March 22, 2021, and its Amended and Restated Bylaws were most recently amended on June 8, 2021. Copies of the Company's current certificate of incorporation and bylaws have been previously delivered to Counsel.

3.2 The Company is duly qualified to transact business as a foreign corporation and is in good standing in each jurisdiction where the nature of its business, the character of its properties, or the ownership, leasing, or operation of its assets requires such qualification, except where the failure to be so qualified or in good standing could not reasonably be expected to have a Material Adverse Effect. Without limiting the generality of the foregoing, the Company is qualified to do business and in good standing in the State of Florida, where its principal executive offices and headquarters are located at 8200 West Palmetto Park Road, Suite 1500, Boca Raton, Florida 33433. The Company is also qualified to do business and in good standing in each other state in which it owns, leases, or operates hotel properties or otherwise conducts business.

3.3 The Company's shares of common stock, par value $0.01 per share, are listed on the New York Stock Exchange ("NYSE") under the ticker symbol "VMRK." The Company is subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, and is current in all material respects with its periodic reporting obligations thereunder. The Company is in compliance in all material respects with the applicable listing standards of the NYSE, and the Company has not received any notice of non-compliance or threatened delisting from the NYSE.

3.4 Each Guarantor is duly organized, validly existing, and in good standing under the laws of its respective jurisdiction of organization, as set forth below:

Each Guarantor has been continuously in existence since the date of its organization and has not been dissolved, merged, or consolidated into any other entity. The organizational documents of each Guarantor have been previously delivered to Counsel.

3.5 Each Guarantor is duly qualified to transact business as a foreign entity and is in good standing in each jurisdiction where the nature of its business, the character of its properties, or the ownership, leasing, or operation of its assets requires such qualification, except where the failure to be so qualified or in good standing could not reasonably be expected to have a Material Adverse Effect. Good standing certificates (or the equivalent) for each Guarantor from its jurisdiction of organization and each material jurisdiction of qualification have been previously delivered to Counsel and are current as of dates not more than ten (10) business days prior to the date hereof.

Section 4. Power and Authority

4.1 The Company has the corporate power and authority under its Restated Certificate of Incorporation, as amended, its Amended and Restated Bylaws, and the General Corporation Law of the State of Delaware to execute, deliver, and perform its obligations under each Loan Document to which it is a party, to borrow under the Credit Agreement, to pledge and grant security interests in its assets as contemplated by the Pledge and Security Agreement and the Mortgages, and to consummate the Transaction. The Company's Restated Certificate of Incorporation does not contain any provision that would restrict or limit the Company's ability to enter into the Loan Documents or to consummate the Transaction.

4.2 Each Guarantor has the organizational power and authority under its respective organizational documents and the laws of its jurisdiction of organization to execute, deliver, and perform its obligations under the Guarantee Agreement, the Pledge and Security Agreement, the Mortgages (to the extent it is a party thereto), and each other Loan Document to which it is a party. The organizational documents of each Guarantor do not contain any provision that would restrict or limit such Guarantor's ability to guarantee the obligations of the Company under the Credit Agreement, to pledge and grant security interests in its assets as contemplated by the Pledge and Security Agreement and the Mortgages, or otherwise to perform its obligations under the Loan Documents.

4.3 The Company has the corporate power and authority to own, lease, and operate its properties and assets and to conduct its business as currently conducted. Without limiting the foregoing, the Company and its subsidiaries currently own and operate a portfolio of 74 full-service and select-service hotels located across 18 states in the United States. The Company and its subsidiaries have all rights, franchises, and licenses necessary for the ownership and operation of such properties and the conduct of their business, except where the failure to have any such right, franchise, or license could not reasonably be expected to have a Material Adverse Effect.

Section 5. Authorization and Approval

5.1 The Board of Directors of the Company (the "Board") duly adopted unanimous written resolutions on May 12, 2022 (the "Board Resolutions"), which Board Resolutions authorized, among other things: (a) the execution, delivery, and performance by the Company of the Credit Agreement and each other Loan Document to which it is or may become a party; (b) the borrowing of up to $700,000,000 in principal amount under the Term Loan B; (c) the pledge and grant of security interests in the assets of the Company as contemplated by the Pledge and Security Agreement and the Mortgages; (d) the repayment in full of the outstanding principal, accrued interest, prepayment premium, and all other amounts owing under the Existing Facility with Greystone Federal Credit Corp. as administrative agent; (e) the designation of certain officers of the Company to execute and deliver the Loan Documents and all related documents, instruments, and certificates; and (f) the taking of all actions and the execution and delivery of all documents and instruments as may be necessary or desirable to carry out the intent and purposes of the foregoing. Certified copies of the Board Resolutions have been previously delivered to Counsel.

5.2 The Board Resolutions have not been amended, modified, supplemented, rescinded, or revoked in any respect, and remain in full force and effect as of the date hereof. No other action by the Board or any committee thereof has been taken that would have the effect of amending, modifying, supplementing, rescinding, or revoking the Board Resolutions.

5.3 Each Guarantor has taken all necessary organizational action to authorize the execution, delivery, and performance of each Loan Document to which it is a party, including without limitation the Guarantee Agreement, the Pledge and Security Agreement, and any Mortgages to which such Guarantor is a party. Specifically:

(a) The sole member of Verimark Resort Properties LLC has executed a written consent dated May 12, 2022, authorizing the execution, delivery, and performance by Verimark Resort Properties LLC of each Loan Document to which it is a party;

(b) The Board of Directors of VHG Management Services Inc. has adopted resolutions dated May 12, 2022, authorizing the execution, delivery, and performance by VHG Management Services Inc. of each Loan Document to which it is a party;

(c) The sole member of Verimark Convention Holdings LLC has executed a written consent dated May 12, 2022, authorizing the execution, delivery, and performance by Verimark Convention Holdings LLC of each Loan Document to which it is a party;

(d) The sole member of Palmetto Beachfront Hotels LLC has executed a written consent dated May 12, 2022, authorizing the execution, delivery, and performance by Palmetto Beachfront Hotels LLC of each Loan Document to which it is a party; and

(e) The Board of Directors of Cascadia Hospitality Corp. has adopted resolutions dated May 12, 2022, authorizing the execution, delivery, and performance by Cascadia Hospitality Corp. of each Loan Document to which it is a party.

Certified copies of the foregoing consents and resolutions have been previously delivered to Counsel, and such consents and resolutions have not been amended, modified, rescinded, or revoked and remain in full force and effect as of the date hereof.

5.4 No shareholder vote or approval is required under the Company's Restated Certificate of Incorporation, as amended, the Company's Amended and Restated Bylaws, the General Corporation Law of the State of Delaware, the NYSE listing rules, or any other applicable law, rule, or regulation in connection with the execution, delivery, and performance of the Loan Documents or the consummation of the Transaction.

Section 6. Execution and Delivery

6.1 Each of the Loan Documents to which the Company or any Guarantor is a party has been duly executed and delivered by the Company or such Guarantor, as the case may be. Each such Loan Document has been executed in the form previously delivered to Counsel for review, and no material changes have been made to any such Loan Document subsequent to Counsel's review thereof.

6.2 The persons who executed the Loan Documents on behalf of the Company, and their respective offices, are as follows:

Each of the foregoing individuals was, at the time of execution of the applicable Loan Documents, a duly elected or appointed officer of the Company, serving in the capacity indicated above, and was duly authorized to execute and deliver such Loan Documents on behalf of the Company pursuant to the Board Resolutions.

6.3 The signatures of each of the persons identified in Section 6.2 above appearing on the Loan Documents are the genuine signatures of such persons. The undersigned has personally verified the signatures of each such person and confirms their authenticity.

6.4 The Loan Documents executed on behalf of each Guarantor were executed by individuals duly authorized to act on behalf of such Guarantor, and such individuals' signatures appearing on such documents are their genuine signatures. Incumbency certificates for each Guarantor have been previously delivered to Counsel.

Section 7. No Conflicts

7.1 The execution, delivery, and performance by the Company and each Guarantor of the Loan Documents to which each is a party and the consummation of the Transaction do not and will not:

(a) violate, conflict with, or result in a breach of any provision of the Restated Certificate of Incorporation, as amended, or the Amended and Restated Bylaws of the Company, or the certificate of formation, limited liability company agreement, certificate of incorporation, bylaws, or other organizational documents of any Guarantor;

(b) violate, conflict with, or result in a breach of, or constitute a default (or an event that, with the giving of notice or the passage of time or both, would constitute a default) under, or give rise to any right of termination, cancellation, acceleration, or loss of any benefit under, any material agreement, contract, indenture, lease, instrument, or other obligation to which the Company or any Guarantor is a party or by which any of their respective properties or assets are bound, including without limitation:

(i) that certain Indenture, dated as of June 15, 2021, by and between Verimark Hospitality Group Inc. (as Issuer) and Atlantic Standard Trust Company (as Indenture Trustee), governing the $245,000,000 aggregate principal amount of 5.750% Senior Unsecured Notes due 2028 (the "2028 Notes Indenture"); and

(ii) that certain Credit Agreement, dated as of March 10, 2020, as amended and restated as of September 1, 2021, among Verimark Hospitality Group Inc. (as Borrower), the guarantors party thereto, Crescent Harbor Bank, N.A. (as Administrative Agent), and the lenders from time to time party thereto, providing for a $400,000,000 senior secured revolving credit facility (the "Revolving Credit Facility");

(c) violate any applicable law, statute, rule, or regulation, or any judgment, order, writ, injunction, or decree of any court or governmental authority, applicable to the Company or any Guarantor, or any of their respective properties or assets; or

(d) result in the creation or imposition of any lien, encumbrance, charge, or security interest upon any property or asset of the Company or any Guarantor, other than the liens and security interests created pursuant to the Loan Documents in favor of the Collateral Agent for the benefit of the Secured Parties.

7.2 In connection with the foregoing, the undersigned confirms that: (i) the Company has reviewed the negative covenants and other restrictive provisions contained in the 2028 Notes Indenture and the Revolving Credit Facility, and the execution, delivery, and performance of the Loan Documents and the consummation of the Transaction are permitted thereunder; and (ii) the consents, amendments, or waivers required under such agreements in connection with the Transaction, if any, have been duly obtained.

Section 8. Governmental and Third-Party Approvals

8.1 No consent, approval, license, authorization, registration, filing, or order of, or registration or filing with, any federal, state, local, or foreign governmental authority, agency, commission, or regulatory body is required in connection with the execution, delivery, and performance by the Company or any Guarantor of the Loan Documents or the consummation of the Transaction, other than:

(a) the filing of UCC-1 financing statements with the Secretary of State of the State of Delaware (with respect to the Company and each Guarantor organized in Delaware) and with the Florida Secured Transaction Registry (with respect to Palmetto Beachfront Hotels LLC), in each case naming the applicable obligor as debtor and the Collateral Agent as secured party;

(b) the recording of Mortgages, deeds of trust, assignments of leases and rents, and related instruments in the applicable county recording offices in the following states: Florida, New York, California, Texas, Georgia, Colorado, Arizona, Illinois, Washington, Oregon, Nevada, and Virginia;

(c) the filing of short-form security agreements, assignments, or notices with the United States Patent and Trademark Office with respect to registered trademarks and trademark applications of the Company and its subsidiaries, and with the United States Copyright Office with respect to registered copyrights of the Company and its subsidiaries, in each case as required by the Pledge and Security Agreement;

(d) such consents, approvals, authorizations, registrations, or filings as have already been obtained or made prior to the date hereof; and

(e) such routine post-closing filings, recordings, and registrations as may be required after the date hereof, as set forth in the Post-Closing Letter Agreement dated as of the date hereof.

8.2 No consent of any third party (other than the Lenders and the Administrative Agent) is required under any material agreement, contract, indenture, lease, license, franchise, permit, or other instrument to which the Company or any Guarantor is a party, or by which any of their respective properties or assets are bound, in connection with the execution, delivery, and performance of the Loan Documents or the consummation of the Transaction, that has not been duly obtained prior to the date hereof. Without limiting the foregoing, the Company has obtained all consents required under the 2028 Notes Indenture and the Revolving Credit Facility in connection with the Transaction, to the extent any such consents were required.

Section 9. Litigation

9.1 There is no action, suit, proceeding, arbitration, investigation, claim, or other legal or administrative action pending or, to the knowledge of the undersigned, threatened in writing against or affecting the Company or any Guarantor or any of their respective properties or assets, before or by any court, arbitrator, mediator, governmental authority, agency, commission, or regulatory body, that:

(a) challenges or seeks to prevent, enjoin, alter, or materially delay the consummation of the Transaction or any of the transactions contemplated by the Loan Documents, or seeks damages or other relief in connection therewith; or

(b) if determined adversely to the Company or any Guarantor, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (as defined in the Credit Agreement).

9.2 Neither the Company nor any Guarantor is subject to any outstanding judgment, order, writ, injunction, decree, settlement agreement, or consent order of any court, arbitrator, or governmental authority that would:

(a) materially impair the ability of the Company or any Guarantor to execute, deliver, or perform its obligations under the Loan Documents;

(b) materially impair the ability of the Company or any Guarantor to consummate the Transaction; or

9.3 The undersigned has reviewed the litigation disclosure schedules attached to the Credit Agreement and confirms that such schedules are true, complete, and correct in all material respects as of the date hereof.

Section 10. No Material Adverse Change

10.1 Since December 31, 2021 (the date of the most recent audited consolidated financial statements of the Company and its subsidiaries, which were audited by Clearmont & Wharton LLP, independent registered public accounting firm, engagement partner Ronald Ashby, and which received an unqualified audit opinion), there has been no event, change, occurrence, development, circumstance, or condition that, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect on the business, assets, operations, properties, financial condition, or prospects of the Company and its subsidiaries, taken as a whole.

10.2 For reference purposes, the following summary financial data reflects the Company's consolidated financial performance for the fiscal year ended December 31, 2021, as set forth in the Company's audited financial statements:

• Fiscal Year 2021 Total Revenue: $1,420,000,000

• Fiscal Year 2021 EBITDA: $318,000,000

• Fiscal Year 2021 Adjusted EBITDA (as defined in the Credit Agreement): $341,000,000

To the knowledge of the undersigned, there has been no material adverse change in these financial metrics or in the Company's overall financial performance through the date hereof that has not been disclosed in writing to Counsel. The Company's unaudited consolidated financial statements for the fiscal quarter ended March 31, 2022 (which have been previously delivered to Counsel and the Administrative Agent) were prepared in accordance with generally accepted accounting principles applied on a basis consistent with the audited financial statements referenced above (subject to normal year-end adjustments and the absence of footnotes) and fairly present in all material respects the financial position and results of operations of the Company and its subsidiaries as of and for the period covered thereby.

10.3 No event has occurred, and no condition or circumstance exists, that constitutes, or with the passage of time, the giving of notice, or both, would constitute, an Event of Default under the Credit Agreement as of the date hereof. No Default (as defined in the Credit Agreement) is continuing on the date hereof.

Section 11. Compliance with Laws

11.1 The Company and each Guarantor are in compliance in all material respects with all applicable federal, state, local, and foreign laws, statutes, rules, regulations, orders, judgments, decrees, and requirements of all governmental authorities having jurisdiction over the Company, any Guarantor, or any of their respective properties, assets, or operations, except where the failure to be in such compliance could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.

11.2 Without limiting the generality of the foregoing, the Company and its subsidiaries maintain all material licenses, permits, franchises, approvals, authorizations, consents, and governmental authorizations necessary for the ownership, operation, and management of their 74 hotel properties and the conduct of their business as currently conducted. Such licenses, permits, franchises, and authorizations include, without limitation, all required hotel operating licenses, liquor licenses, food service permits, building and occupancy permits, fire safety certificates, health department permits, and environmental permits. No proceedings are pending or, to the knowledge of the undersigned, threatened that seek the revocation, cancellation, suspension, or adverse modification of any such material license, permit, franchise, or authorization.

Section 12. Representations in the Loan Documents

12.1 The representations and warranties of the Company and each Guarantor set forth in the Credit Agreement (including, without limitation, Article V thereof), the Guarantee Agreement, the Pledge and Security Agreement, and each other Loan Document to which the Company or any Guarantor is a party are true and correct in all material respects as of the date hereof (or, to the extent that any such representation or warranty is qualified by materiality, Material Adverse Effect, or words of similar import, such representation or warranty is true and correct in all respects) as of the date hereof, with the same effect as though made on and as of the date hereof, except to the extent that any such representation or warranty expressly relates to an earlier date, in which case such representation or warranty is true and correct in all material respects (or, to the extent so qualified, in all respects) as of such earlier date. The undersigned has reviewed each such representation and warranty and has made such investigation and inquiry as necessary to confirm the foregoing.

Section 13. Solvency

13.1 After giving pro forma effect to the Transaction, including the borrowing of $700,000,000 under the Term Loan B, the application of the proceeds thereof to repay in full all amounts owing under the Existing Facility with Greystone Federal Credit Corp. as administrative agent (consisting of approximately $621,875,000 in outstanding principal, plus accrued and unpaid interest and a prepayment premium, totaling an aggregate payoff amount of approximately $627,916,667), and the payment of all fees, costs, expenses, and original issue discount incurred in connection with the Transaction:

(a) the fair value of the assets of the Company and its subsidiaries, on a consolidated basis, exceeds their total liabilities (including contingent, subordinated, unmatured, and unliquidated liabilities) on a consolidated basis;

(b) the present fair saleable value of the assets of the Company and its subsidiaries, on a consolidated basis, is greater than the amount that will be required to pay the probable liability of the Company and its subsidiaries, on a consolidated basis, on their debts and other obligations as such debts and obligations become absolute and matured;

(c) the Company and its subsidiaries, on a consolidated basis, are able to pay their debts and other obligations as they become due in the ordinary course of business; and

(d) the Company and its subsidiaries, on a consolidated basis, do not have unreasonably small capital for the conduct of their respective businesses as currently conducted and as proposed to be conducted following the consummation of the Transaction.

13.2 In making the certifications set forth in this Section 13, the undersigned has relied in part upon and is consistent with the Solvency Certificate delivered separately by Renata Haines, Chief Financial Officer of the Company, dated as of July 21, 2022, in substantially the form required by the Credit Agreement. The undersigned has no reason to believe that the representations, certifications, and conclusions set forth in such Solvency Certificate are inaccurate or unreasonable.

Section 14. Capitalization and Subsidiaries

14.1 The Company directly or indirectly owns 100% of the issued and outstanding equity interests (including membership interests, shares of capital stock, and other ownership interests, as applicable) of each of its domestic subsidiaries that is a Guarantor. All such equity interests have been duly authorized and validly issued in accordance with the organizational documents of the applicable Guarantor and applicable law, and, in the case of corporate Guarantors, are fully paid and nonassessable. The Company's ownership of the Guarantors is as follows:

(a) Verimark Resort Properties LLC — 100% of the membership interests are directly owned by the Company;

(b) VHG Management Services Inc. — 100% of the issued and outstanding shares of common stock are directly owned by the Company;

(d) Palmetto Beachfront Hotels LLC — 100% of the membership interests are directly owned by Verimark Resort Properties LLC, a wholly-owned subsidiary of the Company; and

(e) Cascadia Hospitality Corp. — 100% of the issued and outstanding shares of common stock are directly owned by the Company.

14.2 No equity interests in the Company or any Guarantor are subject to any liens, pledges, encumbrances, security interests, options, warrants, rights of first refusal, or restrictions on transfer that would impair or otherwise adversely affect the grant of the security interest pursuant to the Pledge and Security Agreement in favor of the Collateral Agent for the benefit of the Secured Parties, other than: (a) restrictions on transfer imposed by the Loan Documents; (b) restrictions imposed by applicable federal and state securities laws; and (c) customary restrictions contained in the organizational documents of the applicable entity that are not more restrictive than those previously disclosed to Counsel.

14.3 The pledge of 100% of the issued and outstanding equity interests of each domestic subsidiary that is a Guarantor and 65% of the issued and outstanding equity interests of each first-tier foreign subsidiary (consisting of voting stock or equivalent), in each case pursuant to the Pledge and Security Agreement, has been duly authorized by all necessary corporate and organizational action of the Company and the applicable pledgor entities. Appropriate stock certificates, membership interest certificates, or other evidence of ownership, together with duly executed stock powers, transfer powers, or equivalent instruments of transfer endorsed in blank, have been delivered to the Collateral Agent on or prior to the date hereof.

Section 15. Collateral Matters

15.1 To the knowledge of the undersigned, the information set forth in the Perfection Certificate, dated as of July 21, 2022, executed by the Company and each Guarantor and previously delivered to Counsel and the Administrative Agent, is true, correct, and complete in all material respects as of the date hereof. The Perfection Certificate accurately sets forth, among other things, the legal names, prior legal names (within the past five years), jurisdictions of organization, organizational identification numbers, chief executive offices, other locations of tangible personal property, deposit accounts, securities accounts, intellectual property, and commercial tort claims of the Company and each Guarantor.

15.2 The Company's registered agent in the State of Delaware is National Registered Agents Inc., located at 1209 Orange Street, Wilmington, Delaware 19801. Each Guarantor organized in the State of Delaware also maintains National Registered Agents Inc. at the foregoing address as its registered agent in Delaware. Palmetto Beachfront Hotels LLC maintains Fenmore Solutions, 1580 Sawgrass Corporate Parkway, Suite 210, Sunrise, Florida 33323, as its registered agent in the State of Florida.

15.3 The hotel properties identified in the Mortgage schedules for encumbrance pursuant to the Mortgages in favor of the Collateral Agent consist of 42 properties owned by Verimark Resort Properties LLC and Palmetto Beachfront Hotels LLC across 12 states. Such properties have an aggregate appraised value of approximately $2,180,000,000, based on appraisals prepared by independent MAI-certified appraisers in accordance with the Uniform Standards of Professional Appraisal Practice and delivered to the Administrative Agent and Counsel on or prior to the date hereof. The Company is not aware of any material defect, encumbrance, or title matter affecting any of such properties that has not been disclosed in the title insurance commitments and surveys delivered to Counsel and the Administrative Agent.

Section 16. Insurance

16.1 The Company and its subsidiaries maintain insurance coverages with financially sound and reputable insurance companies or through self-insurance programs in such amounts and covering such risks as are required by the Credit Agreement (including, without limitation, Section 6.07 thereof). Without limiting the foregoing, the insurance policies maintained by the Company and its subsidiaries include property insurance (including coverage for fire, windstorm, flood, earthquake, and business interruption), commercial general liability insurance, workers' compensation insurance, automobile liability insurance, umbrella/excess liability insurance, and such other insurance coverages as are customary for companies of similar size engaged in the ownership and operation of hotel properties. Crescent Harbor Bank, N.A., in its capacity as Collateral Agent, has been named as additional insured and/or lender loss payee, as applicable, on the insurance policies of the Company and its subsidiaries with respect to the Collateral, as required by the Credit Agreement, the Pledge and Security Agreement, and the Mortgages. Certificates of insurance evidencing such coverages have been previously delivered to the Administrative Agent and Counsel.

Section 17. Investment Company Act; Margin Regulations

17.1 Neither the Company nor any Guarantor is, or after giving effect to the Transaction will be, (a) an "investment company" or a company "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended (the "Investment Company Act"), or (b) required to register as an "investment company" under the Investment Company Act. The Company and each Guarantor are primarily engaged in the business of owning and operating hotel properties and providing hospitality management and related services, and are not primarily engaged in, and do not propose to engage primarily in, the business of investing, reinvesting, or trading in securities.

17.2 No part of the proceeds of the Term Loan B will be used, directly or indirectly, to purchase or carry any "margin stock" within the meaning of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR Part 221), or to extend credit to others for the purpose of purchasing or carrying any such margin stock, or for any other purpose that would violate the provisions of Regulation U or any other regulation of the Board of Governors of the Federal Reserve System, including Regulations T and X. Neither the Company nor any of its subsidiaries owns any "margin stock" as so defined.

Section 18. ERISA

18.1 No ERISA Event (as defined in the Credit Agreement) has occurred or is reasonably expected to occur that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. Without limiting the foregoing:

(a) Each "employee benefit plan" (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA")) maintained or contributed to by the Company or any ERISA Affiliate is in compliance in all material respects with applicable provisions of ERISA, the Internal Revenue Code of 1986, as amended (the "Code"), and the rules and regulations promulgated thereunder;

(b) Neither the Company nor any ERISA Affiliate maintains, contributes to, or has any liability (contingent or otherwise) with respect to any "defined benefit plan" (as defined in Section 3(35) of ERISA) or any "multiemployer plan" (as defined in Section 4001(a)(3) of ERISA) that could reasonably be expected to result in a Material Adverse Effect;

(c) No "prohibited transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code) has occurred with respect to any employee benefit plan maintained by the Company or any ERISA Affiliate that could reasonably be expected to result in a Material Adverse Effect; and

(d) No "reportable event" (as defined in Section 4043 of ERISA) has occurred with respect to any pension plan maintained or contributed to by the Company or any ERISA Affiliate.

Section 19. Tax Matters

19.1 The Company and each of its subsidiaries have timely filed, or caused to be timely filed, all federal, state, local, and foreign tax returns and reports required to be filed by them, and all such tax returns and reports are true, correct, and complete in all material respects. The Company and each of its subsidiaries have timely paid, or caused to be timely paid, all material taxes (including income taxes, franchise taxes, sales and use taxes, property taxes, employment taxes, and all other taxes and similar charges) shown thereon to be due or assessed against them, except for taxes that are being contested in good faith by appropriate proceedings diligently pursued and for which adequate reserves have been established in accordance with generally accepted accounting principles on the books of the Company and its subsidiaries. There are no material tax liens on any property or assets of the Company or any of its subsidiaries, except for liens for taxes not yet due and payable or that are being contested in good faith as described above.

19.2 The Company's Employer Identification Number is 82-3741956. The Employer Identification Numbers for each Guarantor have been set forth in the Perfection Certificate previously delivered to Counsel.

Section 20. Anti-Corruption, Sanctions, and Anti-Money Laundering

20.1 The Company and each of its subsidiaries are in compliance in all material respects with all applicable anti-corruption laws, rules, and regulations, including without limitation the United States Foreign Corrupt Practices Act of 1977, as amended (the "FCPA"), the UK Bribery Act 2010, and all other applicable anti-bribery and anti-corruption laws and regulations. The Company has implemented and maintains policies and procedures reasonably designed to ensure compliance with the FCPA and other applicable anti-corruption laws, including a written anti-corruption compliance program, employee training programs, and internal controls.

20.2 Neither the Company nor any Guarantor, nor, to the knowledge of the undersigned, any director, officer, employee, agent, or affiliate of the Company or any Guarantor: (a) is a person that is, or is owned or controlled by persons that are, the subject or target of any sanctions administered or enforced by the U.S. Department of the Treasury's Office of Foreign Assets Control ("OFAC"), the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty's Treasury, or any other relevant governmental authority (collectively, "Sanctions") (each such person, a "Sanctioned Person"); or (b) is located, organized, or resident in, or operating from, a country or territory that is, or whose government is, the subject or target of comprehensive, country-wide, or territory-wide Sanctions (each, a "Sanctioned Country") in violation of applicable Sanctions. The Company and its subsidiaries are in compliance in all material respects with all applicable Sanctions and anti-money laundering laws, including the USA PATRIOT Act (Title III of Pub. L. 107-56) and the Bank Secrecy Act (31 U.S.C. §§ 5311-5330).

20.3 The Company has delivered its Know Your Customer Package (the "KYC Package"), dated April 15, 2022, to Crescent Harbor Bank, N.A. (as Administrative Agent), including beneficial ownership certifications and all other information requested pursuant to applicable "know your customer" and anti-money laundering rules and regulations. The information contained in the KYC Package was true, correct, and complete in all material respects as of the date thereof and remains true, correct, and complete in all material respects as of the date hereof. No material changes have occurred with respect to such information since the date the KYC Package was delivered.

Section 21. Use of Proceeds

21.1 The proceeds of the $700,000,000 Term Loan B are being used solely as follows:

(i) to refinance in full the Existing Facility, including the repayment of all outstanding principal ($621,875,000), accrued and unpaid interest, a prepayment premium, and all other amounts required to be paid under the payoff letter delivered by Greystone Federal Credit Corp. (as administrative agent under the Existing Facility) dated July 19, 2022, in a total aggregate payoff amount of approximately $627,916,667;

(ii) to pay fees, costs, expenses, and original issue discount incurred by the Company in connection with the Transaction, including arrangement fees, underwriting fees, commitment fees, legal fees and expenses of Counsel and the Company's own counsel, administrative agent fees, and other customary transaction costs; and

(iii) to apply the incremental net proceeds of approximately $60,483,333 (representing the excess of the Term Loan B proceeds over the aggregate payoff amount, original issue discount, and transaction fees and expenses) for permitted acquisitions and general corporate purposes of the Company and its subsidiaries, in each case as permitted by and in accordance with the terms of the Credit Agreement, including Section 7.06 (Restricted Payments), Section 7.07 (Investments), and Section 7.08 (Acquisitions) thereof.

No portion of the proceeds of the Term Loan B will be used, directly or indirectly, for any purpose that would violate any applicable law, including any Sanctions or anti-corruption law, or for the purpose of purchasing or carrying any "margin stock" as described in Section 17.2 hereof.

Section 22. Accuracy and Reliance

22.1 The undersigned has made diligent inquiry and investigation of such officers, employees, agents, and representatives of the Company and its subsidiaries, and has reviewed such corporate records, agreements, documents, certificates, and other materials, as the undersigned has deemed necessary and appropriate in order to make the representations, certifications, and statements set forth herein on a fully informed basis. The undersigned believes that such inquiry and investigation has been sufficient to enable the undersigned to make the representations, certifications, and statements contained herein.

22.2 The undersigned acknowledges and confirms that Calderwood & Harkness LLP, in its capacity as Counsel to the Administrative Agent and the Lenders, is relying upon the truth, accuracy, and completeness of the representations, certifications, and statements set forth in this Certificate in connection with the preparation and delivery of the Opinions, and the undersigned, on behalf of the Company, hereby authorizes such reliance. The undersigned further acknowledges that Counsel has not independently verified the factual matters set forth herein and is entitled to rely upon this Certificate without any obligation of independent investigation or verification.

22.3 This Certificate and the representations, certifications, and statements set forth herein may be relied upon by Calderwood & Harkness LLP and by any person or entity to whom the Opinions are addressed or delivered in accordance with the terms thereof, including Crescent Harbor Bank, N.A. (in its capacities as Administrative Agent and Collateral Agent) and each Lender under the Credit Agreement. No other person or entity is entitled to rely upon this Certificate without the prior written consent of the undersigned.

22.4 The undersigned undertakes to promptly advise Counsel in writing if any of the representations, certifications, or statements set forth in this Certificate ceases to be true, correct, and complete in all material respects prior to the funding of the Term Loan B on the date hereof.

[Remainder of this page intentionally left blank; signature page follows.]

SIGNATURE PAGE TO OPINION BACKUP CERTIFICATE

IN WITNESS WHEREOF, the undersigned has duly executed this Opinion Backup Certificate as of the date first written above.

VERIMARK HOSPITALITY GROUP INC.

By: ________

Name: Priya Narayanan

Title: General Counsel and Corporate Secretary

Date: July 21, 2022

This Opinion Backup Certificate is delivered solely in connection with the Opinions of Calderwood & Harkness LLP dated July 21, 2022, and is not intended to confer any rights upon, or create any obligations to, any person or entity other than as expressly set forth herein. This Certificate shall be governed by and construed in accordance with the laws of the State of New York.

Guarantor	Entity Type	Jurisdiction of Organization	State File Number
Verimark Resort Properties LLC	Limited Liability Company	Delaware	7312554
VHG Management Services Inc.	Corporation	Delaware	7324018
Verimark Convention Holdings LLC	Limited Liability Company	Delaware	7338921
Palmetto Beachfront Hotels LLC	Limited Liability Company	Florida	L19000246811
Cascadia Hospitality Corp.	Corporation	Delaware	7401237
Name	Title	Loan Documents Executed
Marcus Delvecchio	Chief Executive Officer	Credit Agreement
Renata Haines	Chief Financial Officer	Credit Agreement; Pledge and Security Agreement
Priya Narayanan	General Counsel and Corporate Secretary	Guarantee Agreement; Pledge and Security Agreement; Mortgages; Intercreditor Agreement; ancillary documents
Glenn Fischbach	Treasurer	Promissory Notes; ancillary documents

OPINION BACKUP CERTIFICATE
of Verimark Hospitality Group Inc.
July 21, 2022
Delivered in connection with that certain Credit Agreement, dated as of July 21, 2022 (the "Credit Agreement"), among Verimark Hospitality Group Inc., a Delaware corporation (the "Borrower" or the "Company"), the Guarantors party thereto, Crescent Harbor Bank, N.A., as Administrative Agent and Collateral Agent (in such capacities, the "Administrative Agent" and the "Collateral Agent," respectively), and the Lenders from time to time party thereto, providing for a $700,000,000 Senior Secured Term Loan B facility (the "Term Loan B").
Addressee:
Calderwood & Harkness LLP One Liberty Plaza, 52nd Floor New York, New York 10006
Attention: Banking & Finance Practice Group
Purpose: This Certificate (this "Certificate") is delivered to Calderwood & Harkness LLP ("Counsel") in connection with Counsel's delivery of its legal opinions dated July 21, 2022 (the "Opinions") addressed to Crescent Harbor Bank, N.A. (in its capacity as Administrative Agent) and the Lenders under the Credit Agreement. The undersigned understands that Counsel is relying on the factual representations and statements set forth herein in rendering the Opinions, and the undersigned, on behalf of the Company, hereby authorizes such reliance. The undersigned further acknowledges that the Opinions are being delivered as a condition precedent to the effectiveness of the Credit Agreement and the initial funding of the Term Loan B on the date hereof.
Section 1. Defined Terms and Interpretive Provisions
1.1 Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement. As used in this Certificate, the following terms shall have the following meanings:
(a) The "Credit Agreement" means that certain Credit Agreement dated as of July 21, 2022, among the Borrower, the Guarantors party thereto, Crescent Harbor Bank, N.A., as Administrative Agent and Collateral Agent, and the Lenders from time to time party thereto.
(b) The "Loan Documents" means, collectively, the Credit Agreement, the Guarantee Agreement dated as of the date hereof (the "Guarantee Agreement"), the Pledge and Security Agreement dated as of the date hereof (the "Pledge and Security Agreement"), the Amended and Restated Intercreditor Agreement dated as of the date hereof among the Administrative Agent and the other secured parties identified therein (the "Intercreditor Agreement"), the Mortgages, the Promissory Notes, and all other documents, instruments, certificates, and agreements executed and delivered in connection therewith on or prior to the date hereof.
(c) The "Transaction" means, collectively, (i) the borrowing of $700,000,000 under the Term Loan B, (ii) the payoff and discharge in full of the existing $625,000,000 term loan facility (the "Existing Facility") with Greystone Federal Credit Corp. as administrative agent (the "Existing Agent"), (iii) the release of all liens and security interests securing the Existing Facility, and (iv) the related transactions contemplated by the Loan Documents, including the grant of liens and security interests in favor of the Collateral Agent, as more fully described in the Credit Agreement and the other Loan Documents.
(d) The "Guarantors" means, collectively, the following subsidiaries of the Company, each of which is a party to the Guarantee Agreement and the Pledge and Security Agreement:
(i) Verimark Resort Properties LLC, a limited liability company organized and existing under the laws of the State of Delaware;
(ii) VHG Management Services Inc., a corporation incorporated and existing under the laws of the State of Delaware;
(iii) Verimark Convention Holdings LLC, a limited liability company organized and existing under the laws of the State of Delaware;
(iv) Palmetto Beachfront Hotels LLC, a limited liability company organized and existing under the laws of the State of Florida; and
(v) Cascadia Hospitality Corp., a corporation incorporated and existing under the laws of the State of Delaware.
1.2 Unless the context otherwise requires, references herein to "Sections" are to sections of this Certificate, references to the "undersigned" are to Priya Narayanan in her capacity as General Counsel and Corporate Secretary of the Company, and the words "herein," "hereof," and "hereunder" refer to this Certificate as a whole. The use of the phrase "to the knowledge of the undersigned" or words of similar import means the actual knowledge of the undersigned after due inquiry and investigation of such officers and employees of the Company and its subsidiaries as the undersigned has deemed appropriate in connection with the preparation of this Certificate.
Section 2. Identity and Authority of the Certifying Officer
2.1 The undersigned is Priya Narayanan, General Counsel and Corporate Secretary of Verimark Hospitality Group Inc. The undersigned has served in the capacity of General Counsel since March 2019 and in the additional capacity of Corporate Secretary since January 2020. In such capacities, the undersigned is responsible for, among other things, the legal affairs of the Company and its subsidiaries, maintaining the corporate records and minute books of the Company, and overseeing compliance with the Company's organizational documents and applicable law.
2.2 The representations, certifications, and statements set forth in this Certificate are made based upon the personal knowledge of the undersigned and upon information and knowledge obtained through reasonable and diligent inquiry and investigation of the appropriate officers and employees of the Company and its subsidiaries, including, without limitation, Marcus Delvecchio (Chief Executive Officer), Renata Haines (Chief Financial Officer), Glenn Fischbach (Treasurer), and such other personnel as the undersigned has deemed necessary or appropriate. The undersigned has also reviewed or caused to be reviewed such corporate records, documents, agreements, certificates, and other instruments of the Company and its subsidiaries as the undersigned has deemed relevant to the matters addressed herein.
2.3 The undersigned is duly authorized to execute and deliver this Certificate on behalf of the Company pursuant to the resolutions of the Board of Directors of the Company referenced in Section 5 hereof and in her capacity as General Counsel and Corporate Secretary of the Company.
Section 3. Organization, Good Standing, and Qualification
3.1 The Company is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware. The Company was originally incorporated under the laws of the State of Delaware on September 14, 2016 and has been continuously in existence since that date. The Company's file number with the Secretary of State of the State of Delaware is 7291843. The Company's Employer Identification Number assigned by the Internal Revenue Service is 82-3741956. The Company's Restated Certificate of Incorporation, as amended, was most recently amended on March 22, 2021, and its Amended and Restated Bylaws were most recently amended on June 8, 2021. Copies of the Company's current certificate of incorporation and bylaws have been previously delivered to Counsel.
3.2 The Company is duly qualified to transact business as a foreign corporation and is in good standing in each jurisdiction where the nature of its business, the character of its properties, or the ownership, leasing, or operation of its assets requires such qualification, except where the failure to be so qualified or in good standing could not reasonably be expected to have a Material Adverse Effect. Without limiting the generality of the foregoing, the Company is qualified to do business and in good standing in the State of Florida, where its principal executive offices and headquarters are located at 8200 West Palmetto Park Road, Suite 1500, Boca Raton, Florida 33433. The Company is also qualified to do business and in good standing in each other state in which it owns, leases, or operates hotel properties or otherwise conducts business.
3.3 The Company's shares of common stock, par value $0.01 per share, are listed on the New York Stock Exchange ("NYSE") under the ticker symbol "VMRK." The Company is subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, and is current in all material respects with its periodic reporting obligations thereunder. The Company is in compliance in all material respects with the applicable listing standards of the NYSE, and the Company has not received any notice of non-compliance or threatened delisting from the NYSE.
3.4 Each Guarantor is duly organized, validly existing, and in good standing under the laws of its respective jurisdiction of organization, as set forth below:
Each Guarantor has been continuously in existence since the date of its organization and has not been dissolved, merged, or consolidated into any other entity. The organizational documents of each Guarantor have been previously delivered to Counsel.
3.5 Each Guarantor is duly qualified to transact business as a foreign entity and is in good standing in each jurisdiction where the nature of its business, the character of its properties, or the ownership, leasing, or operation of its assets requires such qualification, except where the failure to be so qualified or in good standing could not reasonably be expected to have a Material Adverse Effect. Good standing certificates (or the equivalent) for each Guarantor from its jurisdiction of organization and each material jurisdiction of qualification have been previously delivered to Counsel and are current as of dates not more than ten (10) business days prior to the date hereof.
Section 4. Power and Authority
4.1 The Company has the corporate power and authority under its Restated Certificate of Incorporation, as amended, its Amended and Restated Bylaws, and the General Corporation Law of the State of Delaware to execute, deliver, and perform its obligations under each Loan Document to which it is a party, to borrow under the Credit Agreement, to pledge and grant security interests in its assets as contemplated by the Pledge and Security Agreement and the Mortgages, and to consummate the Transaction. The Company's Restated Certificate of Incorporation does not contain any provision that would restrict or limit the Company's ability to enter into the Loan Documents or to consummate the Transaction.
4.2 Each Guarantor has the organizational power and authority under its respective organizational documents and the laws of its jurisdiction of organization to execute, deliver, and perform its obligations under the Guarantee Agreement, the Pledge and Security Agreement, the Mortgages (to the extent it is a party thereto), and each other Loan Document to which it is a party. The organizational documents of each Guarantor do not contain any provision that would restrict or limit such Guarantor's ability to guarantee the obligations of the Company under the Credit Agreement, to pledge and grant security interests in its assets as contemplated by the Pledge and Security Agreement and the Mortgages, or otherwise to perform its obligations under the Loan Documents.
4.3 The Company has the corporate power and authority to own, lease, and operate its properties and assets and to conduct its business as currently conducted. Without limiting the foregoing, the Company and its subsidiaries currently own and operate a portfolio of 74 full-service and select-service hotels located across 18 states in the United States. The Company and its subsidiaries have all rights, franchises, and licenses necessary for the ownership and operation of such properties and the conduct of their business, except where the failure to have any such right, franchise, or license could not reasonably be expected to have a Material Adverse Effect.
Section 5. Authorization and Approval
5.1 The Board of Directors of the Company (the "Board") duly adopted unanimous written resolutions on May 12, 2022 (the "Board Resolutions"), which Board Resolutions authorized, among other things: (a) the execution, delivery, and performance by the Company of the Credit Agreement and each other Loan Document to which it is or may become a party; (b) the borrowing of up to $700,000,000 in principal amount under the Term Loan B; (c) the pledge and grant of security interests in the assets of the Company as contemplated by the Pledge and Security Agreement and the Mortgages; (d) the repayment in full of the outstanding principal, accrued interest, prepayment premium, and all other amounts owing under the Existing Facility with Greystone Federal Credit Corp. as administrative agent; (e) the designation of certain officers of the Company to execute and deliver the Loan Documents and all related documents, instruments, and certificates; and (f) the taking of all actions and the execution and delivery of all documents and instruments as may be necessary or desirable to carry out the intent and purposes of the foregoing. Certified copies of the Board Resolutions have been previously delivered to Counsel.
5.2 The Board Resolutions have not been amended, modified, supplemented, rescinded, or revoked in any respect, and remain in full force and effect as of the date hereof. No other action by the Board or any committee thereof has been taken that would have the effect of amending, modifying, supplementing, rescinding, or revoking the Board Resolutions.
5.3 Each Guarantor has taken all necessary organizational action to authorize the execution, delivery, and performance of each Loan Document to which it is a party, including without limitation the Guarantee Agreement, the Pledge and Security Agreement, and any Mortgages to which such Guarantor is a party. Specifically:
(a) The sole member of Verimark Resort Properties LLC has executed a written consent dated May 12, 2022, authorizing the execution, delivery, and performance by Verimark Resort Properties LLC of each Loan Document to which it is a party;
(b) The Board of Directors of VHG Management Services Inc. has adopted resolutions dated May 12, 2022, authorizing the execution, delivery, and performance by VHG Management Services Inc. of each Loan Document to which it is a party;
(c) The sole member of Verimark Convention Holdings LLC has executed a written consent dated May 12, 2022, authorizing the execution, delivery, and performance by Verimark Convention Holdings LLC of each Loan Document to which it is a party;
(d) The sole member of Palmetto Beachfront Hotels LLC has executed a written consent dated May 12, 2022, authorizing the execution, delivery, and performance by Palmetto Beachfront Hotels LLC of each Loan Document to which it is a party; and
(e) The Board of Directors of Cascadia Hospitality Corp. has adopted resolutions dated May 12, 2022, authorizing the execution, delivery, and performance by Cascadia Hospitality Corp. of each Loan Document to which it is a party.
Certified copies of the foregoing consents and resolutions have been previously delivered to Counsel, and such consents and resolutions have not been amended, modified, rescinded, or revoked and remain in full force and effect as of the date hereof.
5.4 No shareholder vote or approval is required under the Company's Restated Certificate of Incorporation, as amended, the Company's Amended and Restated Bylaws, the General Corporation Law of the State of Delaware, the NYSE listing rules, or any other applicable law, rule, or regulation in connection with the execution, delivery, and performance of the Loan Documents or the consummation of the Transaction.
Section 6. Execution and Delivery
6.1 Each of the Loan Documents to which the Company or any Guarantor is a party has been duly executed and delivered by the Company or such Guarantor, as the case may be. Each such Loan Document has been executed in the form previously delivered to Counsel for review, and no material changes have been made to any such Loan Document subsequent to Counsel's review thereof.
6.2 The persons who executed the Loan Documents on behalf of the Company, and their respective offices, are as follows:
Each of the foregoing individuals was, at the time of execution of the applicable Loan Documents, a duly elected or appointed officer of the Company, serving in the capacity indicated above, and was duly authorized to execute and deliver such Loan Documents on behalf of the Company pursuant to the Board Resolutions.
6.3 The signatures of each of the persons identified in Section 6.2 above appearing on the Loan Documents are the genuine signatures of such persons. The undersigned has personally verified the signatures of each such person and confirms their authenticity.
6.4 The Loan Documents executed on behalf of each Guarantor were executed by individuals duly authorized to act on behalf of such Guarantor, and such individuals' signatures appearing on such documents are their genuine signatures. Incumbency certificates for each Guarantor have been previously delivered to Counsel.
Section 7. No Conflicts
7.1 The execution, delivery, and performance by the Company and each Guarantor of the Loan Documents to which each is a party and the consummation of the Transaction do not and will not:
(a) violate, conflict with, or result in a breach of any provision of the Restated Certificate of Incorporation, as amended, or the Amended and Restated Bylaws of the Company, or the certificate of formation, limited liability company agreement, certificate of incorporation, bylaws, or other organizational documents of any Guarantor;
(b) violate, conflict with, or result in a breach of, or constitute a default (or an event that, with the giving of notice or the passage of time or both, would constitute a default) under, or give rise to any right of termination, cancellation, acceleration, or loss of any benefit under, any material agreement, contract, indenture, lease, instrument, or other obligation to which the Company or any Guarantor is a party or by which any of their respective properties or assets are bound, including without limitation:
(i) that certain Indenture, dated as of June 15, 2021, by and between Verimark Hospitality Group Inc. (as Issuer) and Atlantic Standard Trust Company (as Indenture Trustee), governing the $245,000,000 aggregate principal amount of 5.750% Senior Unsecured Notes due 2028 (the "2028 Notes Indenture"); and
(ii) that certain Credit Agreement, dated as of March 10, 2020, as amended and restated as of September 1, 2021, among Verimark Hospitality Group Inc. (as Borrower), the guarantors party thereto, Crescent Harbor Bank, N.A. (as Administrative Agent), and the lenders from time to time party thereto, providing for a $400,000,000 senior secured revolving credit facility (the "Revolving Credit Facility");
(c) violate any applicable law, statute, rule, or regulation, or any judgment, order, writ, injunction, or decree of any court or governmental authority, applicable to the Company or any Guarantor, or any of their respective properties or assets; or
(d) result in the creation or imposition of any lien, encumbrance, charge, or security interest upon any property or asset of the Company or any Guarantor, other than the liens and security interests created pursuant to the Loan Documents in favor of the Collateral Agent for the benefit of the Secured Parties.
7.2 In connection with the foregoing, the undersigned confirms that: (i) the Company has reviewed the negative covenants and other restrictive provisions contained in the 2028 Notes Indenture and the Revolving Credit Facility, and the execution, delivery, and performance of the Loan Documents and the consummation of the Transaction are permitted thereunder; and (ii) the consents, amendments, or waivers required under such agreements in connection with the Transaction, if any, have been duly obtained.
Section 8. Governmental and Third-Party Approvals
8.1 No consent, approval, license, authorization, registration, filing, or order of, or registration or filing with, any federal, state, local, or foreign governmental authority, agency, commission, or regulatory body is required in connection with the execution, delivery, and performance by the Company or any Guarantor of the Loan Documents or the consummation of the Transaction, other than:
(a) the filing of UCC-1 financing statements with the Secretary of State of the State of Delaware (with respect to the Company and each Guarantor organized in Delaware) and with the Florida Secured Transaction Registry (with respect to Palmetto Beachfront Hotels LLC), in each case naming the applicable obligor as debtor and the Collateral Agent as secured party;
(b) the recording of Mortgages, deeds of trust, assignments of leases and rents, and related instruments in the applicable county recording offices in the following states: Florida, New York, California, Texas, Georgia, Colorado, Arizona, Illinois, Washington, Oregon, Nevada, and Virginia;
(c) the filing of short-form security agreements, assignments, or notices with the United States Patent and Trademark Office with respect to registered trademarks and trademark applications of the Company and its subsidiaries, and with the United States Copyright Office with respect to registered copyrights of the Company and its subsidiaries, in each case as required by the Pledge and Security Agreement;
(d) such consents, approvals, authorizations, registrations, or filings as have already been obtained or made prior to the date hereof; and
(e) such routine post-closing filings, recordings, and registrations as may be required after the date hereof, as set forth in the Post-Closing Letter Agreement dated as of the date hereof.
8.2 No consent of any third party (other than the Lenders and the Administrative Agent) is required under any material agreement, contract, indenture, lease, license, franchise, permit, or other instrument to which the Company or any Guarantor is a party, or by which any of their respective properties or assets are bound, in connection with the execution, delivery, and performance of the Loan Documents or the consummation of the Transaction, that has not been duly obtained prior to the date hereof. Without limiting the foregoing, the Company has obtained all consents required under the 2028 Notes Indenture and the Revolving Credit Facility in connection with the Transaction, to the extent any such consents were required.
Section 9. Litigation
9.1 There is no action, suit, proceeding, arbitration, investigation, claim, or other legal or administrative action pending or, to the knowledge of the undersigned, threatened in writing against or affecting the Company or any Guarantor or any of their respective properties or assets, before or by any court, arbitrator, mediator, governmental authority, agency, commission, or regulatory body, that:
(a) challenges or seeks to prevent, enjoin, alter, or materially delay the consummation of the Transaction or any of the transactions contemplated by the Loan Documents, or seeks damages or other relief in connection therewith; or
(b) if determined adversely to the Company or any Guarantor, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (as defined in the Credit Agreement).
9.2 Neither the Company nor any Guarantor is subject to any outstanding judgment, order, writ, injunction, decree, settlement agreement, or consent order of any court, arbitrator, or governmental authority that would:
(a) materially impair the ability of the Company or any Guarantor to execute, deliver, or perform its obligations under the Loan Documents;
(b) materially impair the ability of the Company or any Guarantor to consummate the Transaction; or
(c) otherwise result in or contribute to a Material Adverse Effect.
9.3 The undersigned has reviewed the litigation disclosure schedules attached to the Credit Agreement and confirms that such schedules are true, complete, and correct in all material respects as of the date hereof.
Section 10. No Material Adverse Change
10.1 Since December 31, 2021 (the date of the most recent audited consolidated financial statements of the Company and its subsidiaries, which were audited by Clearmont & Wharton LLP, independent registered public accounting firm, engagement partner Ronald Ashby, and which received an unqualified audit opinion), there has been no event, change, occurrence, development, circumstance, or condition that, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect on the business, assets, operations, properties, financial condition, or prospects of the Company and its subsidiaries, taken as a whole.
10.2 For reference purposes, the following summary financial data reflects the Company's consolidated financial performance for the fiscal year ended December 31, 2021, as set forth in the Company's audited financial statements:
•  Fiscal Year 2021 Total Revenue: $1,420,000,000
•  Fiscal Year 2021 EBITDA: $318,000,000
•  Fiscal Year 2021 Adjusted EBITDA (as defined in the Credit Agreement): $341,000,000
To the knowledge of the undersigned, there has been no material adverse change in these financial metrics or in the Company's overall financial performance through the date hereof that has not been disclosed in writing to Counsel. The Company's unaudited consolidated financial statements for the fiscal quarter ended March 31, 2022 (which have been previously delivered to Counsel and the Administrative Agent) were prepared in accordance with generally accepted accounting principles applied on a basis consistent with the audited financial statements referenced above (subject to normal year-end adjustments and the absence of footnotes) and fairly present in all material respects the financial position and results of operations of the Company and its subsidiaries as of and for the period covered thereby.
10.3 No event has occurred, and no condition or circumstance exists, that constitutes, or with the passage of time, the giving of notice, or both, would constitute, an Event of Default under the Credit Agreement as of the date hereof. No Default (as defined in the Credit Agreement) is continuing on the date hereof.
Section 11. Compliance with Laws
11.1 The Company and each Guarantor are in compliance in all material respects with all applicable federal, state, local, and foreign laws, statutes, rules, regulations, orders, judgments, decrees, and requirements of all governmental authorities having jurisdiction over the Company, any Guarantor, or any of their respective properties, assets, or operations, except where the failure to be in such compliance could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.
11.2 Without limiting the generality of the foregoing, the Company and its subsidiaries maintain all material licenses, permits, franchises, approvals, authorizations, consents, and governmental authorizations necessary for the ownership, operation, and management of their 74 hotel properties and the conduct of their business as currently conducted. Such licenses, permits, franchises, and authorizations include, without limitation, all required hotel operating licenses, liquor licenses, food service permits, building and occupancy permits, fire safety certificates, health department permits, and environmental permits. No proceedings are pending or, to the knowledge of the undersigned, threatened that seek the revocation, cancellation, suspension, or adverse modification of any such material license, permit, franchise, or authorization.
Section 12. Representations in the Loan Documents
12.1 The representations and warranties of the Company and each Guarantor set forth in the Credit Agreement (including, without limitation, Article V thereof), the Guarantee Agreement, the Pledge and Security Agreement, and each other Loan Document to which the Company or any Guarantor is a party are true and correct in all material respects as of the date hereof (or, to the extent that any such representation or warranty is qualified by materiality, Material Adverse Effect, or words of similar import, such representation or warranty is true and correct in all respects) as of the date hereof, with the same effect as though made on and as of the date hereof, except to the extent that any such representation or warranty expressly relates to an earlier date, in which case such representation or warranty is true and correct in all material respects (or, to the extent so qualified, in all respects) as of such earlier date. The undersigned has reviewed each such representation and warranty and has made such investigation and inquiry as necessary to confirm the foregoing.
Section 13. Solvency
13.1 After giving pro forma effect to the Transaction, including the borrowing of $700,000,000 under the Term Loan B, the application of the proceeds thereof to repay in full all amounts owing under the Existing Facility with Greystone Federal Credit Corp. as administrative agent (consisting of approximately $621,875,000 in outstanding principal, plus accrued and unpaid interest and a prepayment premium, totaling an aggregate payoff amount of approximately $627,916,667), and the payment of all fees, costs, expenses, and original issue discount incurred in connection with the Transaction:
(a) the fair value of the assets of the Company and its subsidiaries, on a consolidated basis, exceeds their total liabilities (including contingent, subordinated, unmatured, and unliquidated liabilities) on a consolidated basis;
(b) the present fair saleable value of the assets of the Company and its subsidiaries, on a consolidated basis, is greater than the amount that will be required to pay the probable liability of the Company and its subsidiaries, on a consolidated basis, on their debts and other obligations as such debts and obligations become absolute and matured;
(c) the Company and its subsidiaries, on a consolidated basis, are able to pay their debts and other obligations as they become due in the ordinary course of business; and
(d) the Company and its subsidiaries, on a consolidated basis, do not have unreasonably small capital for the conduct of their respective businesses as currently conducted and as proposed to be conducted following the consummation of the Transaction.
13.2 In making the certifications set forth in this Section 13, the undersigned has relied in part upon and is consistent with the Solvency Certificate delivered separately by Renata Haines, Chief Financial Officer of the Company, dated as of July 21, 2022, in substantially the form required by the Credit Agreement. The undersigned has no reason to believe that the representations, certifications, and conclusions set forth in such Solvency Certificate are inaccurate or unreasonable.
Section 14. Capitalization and Subsidiaries
14.1 The Company directly or indirectly owns 100% of the issued and outstanding equity interests (including membership interests, shares of capital stock, and other ownership interests, as applicable) of each of its domestic subsidiaries that is a Guarantor. All such equity interests have been duly authorized and validly issued in accordance with the organizational documents of the applicable Guarantor and applicable law, and, in the case of corporate Guarantors, are fully paid and nonassessable. The Company's ownership of the Guarantors is as follows:
(a) Verimark Resort Properties LLC — 100% of the membership interests are directly owned by the Company;
(b) VHG Management Services Inc. — 100% of the issued and outstanding shares of common stock are directly owned by the Company;
(c) Verimark Convention Holdings LLC — 100% of the membership interests are directly owned by the Company;
(d) Palmetto Beachfront Hotels LLC — 100% of the membership interests are directly owned by Verimark Resort Properties LLC, a wholly-owned subsidiary of the Company; and
(e) Cascadia Hospitality Corp. — 100% of the issued and outstanding shares of common stock are directly owned by the Company.
14.2 No equity interests in the Company or any Guarantor are subject to any liens, pledges, encumbrances, security interests, options, warrants, rights of first refusal, or restrictions on transfer that would impair or otherwise adversely affect the grant of the security interest pursuant to the Pledge and Security Agreement in favor of the Collateral Agent for the benefit of the Secured Parties, other than: (a) restrictions on transfer imposed by the Loan Documents; (b) restrictions imposed by applicable federal and state securities laws; and (c) customary restrictions contained in the organizational documents of the applicable entity that are not more restrictive than those previously disclosed to Counsel.
14.3 The pledge of 100% of the issued and outstanding equity interests of each domestic subsidiary that is a Guarantor and 65% of the issued and outstanding equity interests of each first-tier foreign subsidiary (consisting of voting stock or equivalent), in each case pursuant to the Pledge and Security Agreement, has been duly authorized by all necessary corporate and organizational action of the Company and the applicable pledgor entities. Appropriate stock certificates, membership interest certificates, or other evidence of ownership, together with duly executed stock powers, transfer powers, or equivalent instruments of transfer endorsed in blank, have been delivered to the Collateral Agent on or prior to the date hereof.
Section 15. Collateral Matters
15.1 To the knowledge of the undersigned, the information set forth in the Perfection Certificate, dated as of July 21, 2022, executed by the Company and each Guarantor and previously delivered to Counsel and the Administrative Agent, is true, correct, and complete in all material respects as of the date hereof. The Perfection Certificate accurately sets forth, among other things, the legal names, prior legal names (within the past five years), jurisdictions of organization, organizational identification numbers, chief executive offices, other locations of tangible personal property, deposit accounts, securities accounts, intellectual property, and commercial tort claims of the Company and each Guarantor.
15.2 The Company's registered agent in the State of Delaware is National Registered Agents Inc., located at 1209 Orange Street, Wilmington, Delaware 19801. Each Guarantor organized in the State of Delaware also maintains National Registered Agents Inc. at the foregoing address as its registered agent in Delaware. Palmetto Beachfront Hotels LLC maintains Fenmore Solutions, 1580 Sawgrass Corporate Parkway, Suite 210, Sunrise, Florida 33323, as its registered agent in the State of Florida.
15.3 The hotel properties identified in the Mortgage schedules for encumbrance pursuant to the Mortgages in favor of the Collateral Agent consist of 42 properties owned by Verimark Resort Properties LLC and Palmetto Beachfront Hotels LLC across 12 states. Such properties have an aggregate appraised value of approximately $2,180,000,000, based on appraisals prepared by independent MAI-certified appraisers in accordance with the Uniform Standards of Professional Appraisal Practice and delivered to the Administrative Agent and Counsel on or prior to the date hereof. The Company is not aware of any material defect, encumbrance, or title matter affecting any of such properties that has not been disclosed in the title insurance commitments and surveys delivered to Counsel and the Administrative Agent.
Section 16. Insurance
16.1 The Company and its subsidiaries maintain insurance coverages with financially sound and reputable insurance companies or through self-insurance programs in such amounts and covering such risks as are required by the Credit Agreement (including, without limitation, Section 6.07 thereof). Without limiting the foregoing, the insurance policies maintained by the Company and its subsidiaries include property insurance (including coverage for fire, windstorm, flood, earthquake, and business interruption), commercial general liability insurance, workers' compensation insurance, automobile liability insurance, umbrella/excess liability insurance, and such other insurance coverages as are customary for companies of similar size engaged in the ownership and operation of hotel properties. Crescent Harbor Bank, N.A., in its capacity as Collateral Agent, has been named as additional insured and/or lender loss payee, as applicable, on the insurance policies of the Company and its subsidiaries with respect to the Collateral, as required by the Credit Agreement, the Pledge and Security Agreement, and the Mortgages. Certificates of insurance evidencing such coverages have been previously delivered to the Administrative Agent and Counsel.
Section 17. Investment Company Act; Margin Regulations
17.1 Neither the Company nor any Guarantor is, or after giving effect to the Transaction will be, (a) an "investment company" or a company "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended (the "Investment Company Act"), or (b) required to register as an "investment company" under the Investment Company Act. The Company and each Guarantor are primarily engaged in the business of owning and operating hotel properties and providing hospitality management and related services, and are not primarily engaged in, and do not propose to engage primarily in, the business of investing, reinvesting, or trading in securities.
17.2 No part of the proceeds of the Term Loan B will be used, directly or indirectly, to purchase or carry any "margin stock" within the meaning of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR Part 221), or to extend credit to others for the purpose of purchasing or carrying any such margin stock, or for any other purpose that would violate the provisions of Regulation U or any other regulation of the Board of Governors of the Federal Reserve System, including Regulations T and X. Neither the Company nor any of its subsidiaries owns any "margin stock" as so defined.
Section 18. ERISA
18.1 No ERISA Event (as defined in the Credit Agreement) has occurred or is reasonably expected to occur that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. Without limiting the foregoing:
(a) Each "employee benefit plan" (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA")) maintained or contributed to by the Company or any ERISA Affiliate is in compliance in all material respects with applicable provisions of ERISA, the Internal Revenue Code of 1986, as amended (the "Code"), and the rules and regulations promulgated thereunder;
(b) Neither the Company nor any ERISA Affiliate maintains, contributes to, or has any liability (contingent or otherwise) with respect to any "defined benefit plan" (as defined in Section 3(35) of ERISA) or any "multiemployer plan" (as defined in Section 4001(a)(3) of ERISA) that could reasonably be expected to result in a Material Adverse Effect;
(c) No "prohibited transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code) has occurred with respect to any employee benefit plan maintained by the Company or any ERISA Affiliate that could reasonably be expected to result in a Material Adverse Effect; and
(d) No "reportable event" (as defined in Section 4043 of ERISA) has occurred with respect to any pension plan maintained or contributed to by the Company or any ERISA Affiliate.
Section 19. Tax Matters
19.1 The Company and each of its subsidiaries have timely filed, or caused to be timely filed, all federal, state, local, and foreign tax returns and reports required to be filed by them, and all such tax returns and reports are true, correct, and complete in all material respects. The Company and each of its subsidiaries have timely paid, or caused to be timely paid, all material taxes (including income taxes, franchise taxes, sales and use taxes, property taxes, employment taxes, and all other taxes and similar charges) shown thereon to be due or assessed against them, except for taxes that are being contested in good faith by appropriate proceedings diligently pursued and for which adequate reserves have been established in accordance with generally accepted accounting principles on the books of the Company and its subsidiaries. There are no material tax liens on any property or assets of the Company or any of its subsidiaries, except for liens for taxes not yet due and payable or that are being contested in good faith as described above.
19.2 The Company's Employer Identification Number is 82-3741956. The Employer Identification Numbers for each Guarantor have been set forth in the Perfection Certificate previously delivered to Counsel.
Section 20. Anti-Corruption, Sanctions, and Anti-Money Laundering
20.1 The Company and each of its subsidiaries are in compliance in all material respects with all applicable anti-corruption laws, rules, and regulations, including without limitation the United States Foreign Corrupt Practices Act of 1977, as amended (the "FCPA"), the UK Bribery Act 2010, and all other applicable anti-bribery and anti-corruption laws and regulations. The Company has implemented and maintains policies and procedures reasonably designed to ensure compliance with the FCPA and other applicable anti-corruption laws, including a written anti-corruption compliance program, employee training programs, and internal controls.
20.2 Neither the Company nor any Guarantor, nor, to the knowledge of the undersigned, any director, officer, employee, agent, or affiliate of the Company or any Guarantor: (a) is a person that is, or is owned or controlled by persons that are, the subject or target of any sanctions administered or enforced by the U.S. Department of the Treasury's Office of Foreign Assets Control ("OFAC"), the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty's Treasury, or any other relevant governmental authority (collectively, "Sanctions") (each such person, a "Sanctioned Person"); or (b) is located, organized, or resident in, or operating from, a country or territory that is, or whose government is, the subject or target of comprehensive, country-wide, or territory-wide Sanctions (each, a "Sanctioned Country") in violation of applicable Sanctions. The Company and its subsidiaries are in compliance in all material respects with all applicable Sanctions and anti-money laundering laws, including the USA PATRIOT Act (Title III of Pub. L. 107-56) and the Bank Secrecy Act (31 U.S.C. §§ 5311-5330).
20.3 The Company has delivered its Know Your Customer Package (the "KYC Package"), dated April 15, 2022, to Crescent Harbor Bank, N.A. (as Administrative Agent), including beneficial ownership certifications and all other information requested pursuant to applicable "know your customer" and anti-money laundering rules and regulations. The information contained in the KYC Package was true, correct, and complete in all material respects as of the date thereof and remains true, correct, and complete in all material respects as of the date hereof. No material changes have occurred with respect to such information since the date the KYC Package was delivered.
Section 21. Use of Proceeds
21.1 The proceeds of the $700,000,000 Term Loan B are being used solely as follows:
(i) to refinance in full the Existing Facility, including the repayment of all outstanding principal ($621,875,000), accrued and unpaid interest, a prepayment premium, and all other amounts required to be paid under the payoff letter delivered by Greystone Federal Credit Corp. (as administrative agent under the Existing Facility) dated July 19, 2022, in a total aggregate payoff amount of approximately $627,916,667;
(ii) to pay fees, costs, expenses, and original issue discount incurred by the Company in connection with the Transaction, including arrangement fees, underwriting fees, commitment fees, legal fees and expenses of Counsel and the Company's own counsel, administrative agent fees, and other customary transaction costs; and
(iii) to apply the incremental net proceeds of approximately $60,483,333 (representing the excess of the Term Loan B proceeds over the aggregate payoff amount, original issue discount, and transaction fees and expenses) for permitted acquisitions and general corporate purposes of the Company and its subsidiaries, in each case as permitted by and in accordance with the terms of the Credit Agreement, including Section 7.06 (Restricted Payments), Section 7.07 (Investments), and Section 7.08 (Acquisitions) thereof.
No portion of the proceeds of the Term Loan B will be used, directly or indirectly, for any purpose that would violate any applicable law, including any Sanctions or anti-corruption law, or for the purpose of purchasing or carrying any "margin stock" as described in Section 17.2 hereof.
Section 22. Accuracy and Reliance
22.1 The undersigned has made diligent inquiry and investigation of such officers, employees, agents, and representatives of the Company and its subsidiaries, and has reviewed such corporate records, agreements, documents, certificates, and other materials, as the undersigned has deemed necessary and appropriate in order to make the representations, certifications, and statements set forth herein on a fully informed basis. The undersigned believes that such inquiry and investigation has been sufficient to enable the undersigned to make the representations, certifications, and statements contained herein.
22.2 The undersigned acknowledges and confirms that Calderwood & Harkness LLP, in its capacity as Counsel to the Administrative Agent and the Lenders, is relying upon the truth, accuracy, and completeness of the representations, certifications, and statements set forth in this Certificate in connection with the preparation and delivery of the Opinions, and the undersigned, on behalf of the Company, hereby authorizes such reliance. The undersigned further acknowledges that Counsel has not independently verified the factual matters set forth herein and is entitled to rely upon this Certificate without any obligation of independent investigation or verification.
22.3 This Certificate and the representations, certifications, and statements set forth herein may be relied upon by Calderwood & Harkness LLP and by any person or entity to whom the Opinions are addressed or delivered in accordance with the terms thereof, including Crescent Harbor Bank, N.A. (in its capacities as Administrative Agent and Collateral Agent) and each Lender under the Credit Agreement. No other person or entity is entitled to rely upon this Certificate without the prior written consent of the undersigned.
22.4 The undersigned undertakes to promptly advise Counsel in writing if any of the representations, certifications, or statements set forth in this Certificate ceases to be true, correct, and complete in all material respects prior to the funding of the Term Loan B on the date hereof.
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SIGNATURE PAGE TO OPINION BACKUP CERTIFICATE
IN WITNESS WHEREOF, the undersigned has duly executed this Opinion Backup Certificate as of the date first written above.
VERIMARK HOSPITALITY GROUP INC.
By: ________
Name: Priya Narayanan
Title: General Counsel and Corporate Secretary
Date: July 21, 2022
This Opinion Backup Certificate is delivered solely in connection with the Opinions of Calderwood & Harkness LLP dated July 21, 2022, and is not intended to confer any rights upon, or create any obligations to, any person or entity other than as expressly set forth herein. This Certificate shall be governed by and construed in accordance with the laws of the State of New York.
Guarantor | Entity Type | Jurisdiction of Organization | State File Number
Verimark Resort Properties LLC | Limited Liability Company | Delaware | 7312554
VHG Management Services Inc. | Corporation | Delaware | 7324018
Verimark Convention Holdings LLC | Limited Liability Company | Delaware | 7338921
Palmetto Beachfront Hotels LLC | Limited Liability Company | Florida | L19000246811
Cascadia Hospitality Corp. | Corporation | Delaware | 7401237
Name | Title | Loan Documents Executed
Marcus Delvecchio | Chief Executive Officer | Credit Agreement
Renata Haines | Chief Financial Officer | Credit Agreement; Pledge and Security Agreement
Priya Narayanan | General Counsel and Corporate Secretary | Guarantee Agreement; Pledge and Security Agreement; Mortgages; Intercreditor Agreement; ancillary documents
Glenn Fischbach | Treasurer | Promissory Notes; ancillary documents

OPINION BACKUP CERTIFICATE

SIGNATURE PAGE TO OPINION BACKUP CERTIFICATE

VERIMARK HOSPITALITY GROUP INC.

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