GREYSTONE FEDERAL CREDIT CORP. 200 Park Avenue South, 22nd Floor New York, NY 10003
July 22, 2022
VIA ELECTRONIC TRANSMISSION AND OVERNIGHT COURIER
Verimark Hospitality Group Inc.
Attention: Priya Narayanan, General Counsel & Corporate Secretary
8200 West Palmetto Park Road, Suite 1500 Boca Raton, FL 33433
Copy to:
Calderwood & Harkness LLP
Attention: Ian Blackwood, Partner, and Sophie Tremblay, Associate
One Liberty Plaza, 52nd Floor New York, NY 10006
Copy to:
Crescent Harbor Bank, N.A. (as successor Administrative Agent and Collateral Agent under the New Credit Facility)
Attention: Theodore Marchetti, Managing Director, Leveraged Finance
600 Lexington Avenue, 34th Floor New York, NY 10022
Re: Confirmation of Payoff and Discharge — Credit Agreement dated as of February 14, 2020, among Verimark Hospitality Group Inc. (as Borrower), the Guarantors party thereto, and Greystone Federal Credit Corp. (as Administrative Agent and Collateral Agent), for the $625,000,000 Senior Secured Term Loan B Facility (CUSIP: 92347LAA0)
Ladies and Gentlemen:
1. Introductory Recitals
Reference is hereby made to that certain Credit Agreement dated as of February 14, 2020 (as amended, restated, supplemented, or otherwise modified from time to time prior to the date hereof, the "Existing Credit Agreement"), among Verimark Hospitality Group Inc., a corporation organized and existing under the laws of the State of Delaware ("VHG" or the "Borrower"), the Guarantors party thereto (being Verimark Resort Properties LLC, a Delaware limited liability company, VHG Management Services Inc., a Delaware corporation, Verimark Convention Holdings LLC, a Delaware limited liability company, Palmetto Beachfront Hotels LLC, a Florida limited liability company, and Cascadia Hospitality Corp., a Washington corporation; each a "Guarantor" and, collectively, the "Guarantors"), the lenders from time to time party thereto (collectively, the "Lenders"), and Greystone Federal Credit Corp., a New York corporation ("Greystone"), acting in its capacity as Administrative Agent and Collateral Agent for the Lenders. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Existing Credit Agreement.
The Existing Credit Agreement provided for a senior secured term loan B facility in an original aggregate principal amount of Six Hundred Twenty-Five Million Dollars ($625,000,000) (the "Term Loan B Facility"). Greystone is issuing this letter in its capacity as Administrative Agent under the Existing Credit Agreement and in its capacity as Collateral Agent under the Existing Credit Agreement and the related Security Documents (as defined therein).
Reference is further made to the Payoff Letter dated July 19, 2022 (the "Payoff Letter"), delivered by Greystone in its capacity as Administrative Agent to VHG and to Calderwood & Harkness LLP, as counsel to VHG, which Payoff Letter set forth the aggregate amounts required to be received by Greystone on behalf of the Lenders in order to satisfy, pay, and discharge in full all obligations of the Borrower and the Guarantors under and in connection with the Existing Credit Agreement and the related Loan Documents. This letter constitutes Greystone's confirmation, on behalf of itself and the Lenders, that the requirements set forth in the Payoff Letter have been satisfied in full.
2. Confirmation of Receipt of Payoff Funds
Greystone hereby confirms that on July 21, 2022 (the "Payoff Date"), Greystone received, via wire transfer of immediately available funds in United States Dollars to the accounts designated in the Payoff Letter, the aggregate payoff amount as set forth in the Payoff Letter, in full and final satisfaction of all outstanding obligations under the Existing Credit Agreement and the related Loan Documents.
The aggregate payoff amount received by Greystone on the Payoff Date consisted of the following components, as itemized in the Payoff Letter:
Greystone confirms that the foregoing funds were received in accordance with the wire transfer instructions set forth in the Payoff Letter, including receipt into the designated accounts at the Federal Reserve Bank of New York. Greystone further confirms that the aggregate payoff amount so received constitutes payment in full of all amounts owing by the Borrower and the Guarantors under the Existing Credit Agreement and the related Loan Documents, including without limitation all outstanding principal, accrued and unpaid interest, fees, prepayment premiums, breakage costs (if any), expenses, indemnification amounts then due and payable, and all other obligations of any kind or nature whatsoever arising under or in connection with the Existing Credit Agreement, the Guarantee Agreement, the Pledge and Security Agreement, and each other Loan Document. No further amounts are owing by the Borrower or any Guarantor in respect of the foregoing obligations as of the Payoff Date, except as expressly set forth in Section 6 below with respect to surviving provisions.
3. Discharge of Obligations
Greystone hereby confirms that, effective as of July 21, 2022, upon receipt of the payoff funds described in Section 2 above:
(a) All obligations of VHG, in its capacity as Borrower under the Existing Credit Agreement, including without limitation all obligations in respect of principal, interest, fees, premiums, expenses, and other amounts payable under or in connection with the Existing Credit Agreement and the other Loan Documents, are hereby fully and finally satisfied, paid, and discharged.
(b) All obligations of each Guarantor, including Verimark Resort Properties LLC, VHG Management Services Inc., Verimark Convention Holdings LLC, Palmetto Beachfront Hotels LLC, and Cascadia Hospitality Corp., arising under or pursuant to the Guarantee Agreement dated as of February 14, 2020 (the "Guarantee Agreement"), executed and delivered in connection with the Existing Credit Agreement, are hereby fully and finally released and discharged. Each Guarantor is hereby released from any and all liability, whether direct, indirect, contingent, or otherwise, under the Guarantee Agreement and any other Loan Document to which such Guarantor is a party.
(c) All commitments of the Lenders under the Existing Credit Agreement, including any unfunded commitments, are hereby irrevocably terminated, and no Lender shall have any obligation to make any further extensions of credit or advances to the Borrower or any Guarantor under the Existing Credit Agreement.
(d) The Existing Credit Agreement and all related Loan Documents, including without limitation the Guarantee Agreement, the Pledge and Security Agreement dated as of February 14, 2020 (the "Pledge and Security Agreement"), each mortgage, deed of trust, and security deed entered into in connection therewith, and each other agreement, instrument, certificate, and document executed and delivered in connection with or pursuant to the Existing Credit Agreement, are hereby terminated and shall be of no further force or effect; provided, however, that those provisions of the Existing Credit Agreement and the related Loan Documents that by their express terms survive termination thereof, including without limitation the indemnification provisions set forth in Section 10.04 of the Existing Credit Agreement and the expense reimbursement provisions set forth in Section 10.05 of the Existing Credit Agreement, shall continue in full force and effect in accordance with their respective terms. For the avoidance of doubt, the survival of such provisions shall not be construed as imposing any continuing payment obligation on the Borrower or any Guarantor except as expressly provided in such surviving provisions.
4. Release of Security Interests and Liens
Greystone, in its capacity as Collateral Agent under the Existing Credit Agreement and the related Security Documents, hereby confirms that, effective as of July 21, 2022, all security interests, liens, mortgages, deeds of trust, security deeds, pledges, assignments, hypothecations, charges, and encumbrances of any kind or nature whatsoever (collectively, "Liens") granted by VHG and the Guarantors in favor of Greystone (as Collateral Agent) for the benefit of the Secured Parties, under or in connection with the Existing Credit Agreement, including without limitation those Liens granted pursuant to the Pledge and Security Agreement, the mortgages, deeds of trust, and security deeds on hotel properties, and all UCC financing statements filed in connection therewith, are hereby released and terminated in full. Greystone, as Collateral Agent, no longer holds or claims any Lien on any property or assets of VHG or any Guarantor arising under or in connection with the Existing Credit Agreement.
Without limiting the generality of the foregoing, the specific categories of collateral hereby released from Greystone's Liens include the following:
(a) Personal Property. All personal property of VHG and each Guarantor that was subject to Liens under the Pledge and Security Agreement, including without limitation all accounts, accounts receivable, chattel paper, commercial tort claims, deposit accounts, documents, equipment, fixtures, general intangibles (including payment intangibles and software), goods, instruments, intellectual property (including patents, patent applications, trademarks, trademark applications, service marks, copyrights, copyright registrations, trade names, domain names, trade secrets, and licenses), inventory, investment property, letter-of-credit rights, and all proceeds and products of any of the foregoing.
(b) Equity Interests — Domestic Subsidiaries. One hundred percent (100%) of the issued and outstanding equity interests in each domestic subsidiary of VHG, including all membership interests, partnership interests, shares of capital stock, and other ownership interests in Verimark Resort Properties LLC, VHG Management Services Inc., Verimark Convention Holdings LLC, Palmetto Beachfront Hotels LLC, Cascadia Hospitality Corp., and each other domestic subsidiary that was pledged under the Pledge and Security Agreement, together with all certificates, instruments, and other documents representing or evidencing such equity interests.
(c) Equity Interests — Foreign Subsidiaries. Sixty-five percent (65%) of the issued and outstanding equity interests in each first-tier foreign subsidiary of VHG that was pledged under the Pledge and Security Agreement, together with all certificates, instruments, and other documents representing or evidencing such equity interests.
(d) Mortgaged Real Property. All fee simple and leasehold interests in hotel properties of VHG and the Guarantors that were subject to mortgages, deeds of trust, or security deeds in favor of Greystone (as Collateral Agent), including all improvements, fixtures, rents, profits, and other rights appurtenant thereto or arising therefrom.
(e) Other Collateral. All other collateral of any kind or nature described in or subject to Liens under the Security Documents entered into in connection with the Existing Credit Agreement, including all supporting obligations, books and records, and other property not specifically enumerated above.
5. Authorization to File Lien Terminations
Greystone, in its capacity as Administrative Agent and Collateral Agent under the Existing Credit Agreement, hereby irrevocably authorizes and directs VHG and its counsel, Calderwood & Harkness LLP, to take the following actions to evidence the release and termination of all Liens previously granted in favor of Greystone under the Existing Credit Agreement and the related Security Documents:
(a) UCC-3 Termination Statements. Prepare, execute (to the extent execution by the secured party is required or customary), and file UCC-3 termination statements with the Delaware Secretary of State, the Florida Secured Transaction Registry, and any and all other applicable filing offices in each jurisdiction where UCC-1 financing statements were previously filed in favor of Greystone (as Collateral Agent) against VHG and each of its subsidiaries, including without limitation Verimark Resort Properties LLC, VHG Management Services Inc., Verimark Convention Holdings LLC, Palmetto Beachfront Hotels LLC, and Cascadia Hospitality Corp. Such UCC-3 termination statements shall terminate and release in full each UCC-1 financing statement (and any continuation statements, amendments, or assignments thereto) filed by or on behalf of Greystone in connection with the Existing Credit Agreement.
(b) Mortgage Releases and Reconveyances. Prepare and record mortgage releases, satisfactions of mortgage, partial releases, reconveyances, releases of deed of trust, cancellations of security deed, and/or any other termination or release documents as may be required or customary in each county, parish, or other recording office where mortgages, deeds of trust, security deeds, or similar instruments were recorded in favor of Greystone (as Collateral Agent) on hotel properties and other real property of VHG and the Guarantors. Such recordings shall include, without limitation, filings in the applicable recording offices in the following states: the State of Florida, the State of New York, the State of California, the State of Texas, the State of Georgia, the State of Colorado, the State of Arizona, the State of Illinois, the State of Washington, the State of Oregon, the State of Nevada, and the Commonwealth of Virginia.
(c) intellectual Property Lien Terminations. Prepare and file termination notices, releases, and/or other instruments with the United States Patent and Trademark Office and the United States Copyright Office terminating any and all notices of security interest, grants of security interest, or other filings previously made in connection with the Existing Credit Agreement or the Security Documents with respect to patents, patent applications, trademarks, trademark applications, service marks, copyrights, copyright registrations, and other registered intellectual property of VHG and the Guarantors.
(d) Additional Actions. Take any and all other actions, and prepare, execute, file, record, deliver, or transmit any and all other documents, instruments, certificates, notices, and filings, in each case as may be necessary or desirable to evidence, effectuate, confirm, or perfect the release and termination of all Liens and security interests of Greystone (as Collateral Agent) arising under or in connection with the Existing Credit Agreement and the related Security Documents.
Greystone agrees to cooperate fully and in good faith with VHG and Calderwood & Harkness LLP in connection with the preparation, execution, and filing of all such termination statements, mortgage releases, lien releases, and other instruments and documents described in this Section 5. Greystone shall promptly execute and deliver, at VHG's sole cost and expense, any additional documents, instruments, certificates, or filings that are reasonably requested by VHG, Calderwood & Harkness LLP, Crescent Harbor Bank, N.A. (as successor Administrative Agent and Collateral Agent under the new credit facility), or Whitfield Gage & Partridge LLP (as counsel to Crescent Harbor Bank, N.A.) to effectuate or confirm the release and termination of Liens contemplated by this letter. Any costs and expenses incurred by Greystone in connection with the execution and delivery of such additional documents shall be reimbursed by VHG in accordance with the surviving expense reimbursement provisions of the Existing Credit Agreement.
6. No Further Obligations
Greystone hereby confirms that, following receipt of the aggregate payoff amount on the Payoff Date and the discharge described in Section 3 above, Greystone has no further claims, demands, actions, or causes of action against VHG or any Guarantor arising under or in connection with the Existing Credit Agreement, the Guarantee Agreement, the Pledge and Security Agreement, or any other Loan Document; provided, however, that the foregoing confirmation shall not constitute a release or waiver of any rights or claims of Greystone arising under or in connection with the indemnification and expense reimbursement provisions of the Existing Credit Agreement that by their express terms survive termination thereof, to the extent that any such rights or claims are based on facts, circumstances, or events occurring on or prior to the Payoff Date and to the extent that claims thereunder are asserted within the time periods specified in such surviving provisions.
VHG and the Guarantors have no further obligations to Greystone, the Lenders, or any other Secured Party under the Existing Credit Agreement or any other Loan Document, except for the aforementioned surviving indemnification and expense reimbursement obligations.
7. Return and Cancellation of Promissory Notes
Any and all promissory notes issued by VHG in favor of any Lender under or in connection with the Existing Credit Agreement are hereby deemed cancelled, terminated, and of no further force or effect, and shall not evidence any obligation of VHG to any Lender. Any original promissory notes that are currently in the possession or control of Greystone (as Administrative Agent) or any Lender shall, upon written request by VHG or its counsel, be marked "PAID IN FULL — CANCELLED" and returned to VHG at the address set forth above, or at such other address as VHG may designate in writing to Greystone. In the event that any original promissory note cannot be located, the cancellation and termination of such note as confirmed by this letter shall be effective irrespective of the physical return of such note, and Greystone shall, upon request, provide a lost note affidavit or similar instrument confirming the cancellation of such note.
8. Miscellaneous
This letter shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to conflict of laws principles that would result in the application of the laws of any other jurisdiction (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law, which shall apply).
This letter is being delivered for the benefit of, and may be relied upon by, VHG, each Guarantor, each subsidiary of VHG, Calderwood & Harkness LLP (as counsel to VHG and the Guarantors), Crescent Harbor Bank, N.A. (as the successor Administrative Agent and Collateral Agent under the new credit facility being entered into by VHG in connection with the refinancing of the Term Loan B Facility), and Whitfield Gage & Partridge LLP (as counsel to Crescent Harbor Bank, N.A.). Any such party may produce this letter in connection with any filing, recording, or registration with any governmental authority, recording office, or filing office to evidence the release and termination of Liens as described herein.
This letter may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. Delivery of an executed signature page of this letter by facsimile or electronic transmission (including portable document format (.pdf)) shall be effective as delivery of a manually executed counterpart of this letter.
This letter is being delivered by Greystone solely in its capacity as Administrative Agent and Collateral Agent under the Existing Credit Agreement and not in its individual or corporate capacity, and nothing in this letter shall be construed to impose any personal liability on Greystone in its individual capacity.
[Signature Page Follows]
[Signature Page to Confirmation of Payoff and Release Letter]
Very truly yours,
GREYSTONE FEDERAL CREDIT CORP. as Administrative Agent and Collateral Agent under the Existing Credit Agreement
By: ________
Name: Marion Stillwell
Title: Vice President, Agency Services
Date: July 22, 2022
cc: Priya Narayanan, General Counsel & Corporate Secretary, Verimark Hospitality Group Inc. cc: Ian Blackwood, Partner, Calderwood & Harkness LLP cc: Sophie Tremblay, Associate, Calderwood & Harkness LLP cc: Theodore Marchetti, Managing Director, Leveraged Finance, Crescent Harbor Bank, N.A. cc: Harrison Whitfield III, Partner, Whitfield Gage & Partridge LLP cc: Megan Yeung, Associate, Whitfield Gage & Partridge LLP
| Component | Amount |
| Outstanding Principal Balance of the Term Loan B Facility (reflecting $3,125,000.00 in scheduled amortization payments made between the origination date of February 14, 2020 and the Payoff Date; being the original $625,000,000.00 principal amount minus $3,125,000.00 in amortization paid to date) | $621,875,000.00 |
| Accrued and Unpaid Interest through and including July 21, 2022 (calculated on the basis of the applicable interest rate and day-count convention as set forth in the Existing Credit Agreement) | $2,916,667.00 |
| Prepayment Premium (calculated as 0.50% of the original principal amount of the Term Loan B Facility, in accordance with Section 2.05(a) of the Existing Credit Agreement) | $3,125,000.00 |
| Total Payoff Amount Received | $627,916,667.00 |