EX-10.3.4 19 g87458exv10w3w4.txt EX-10.3.4 MODIFICATION OF LOAN AGREEMENT EXHIBIT 10.3.4 MODIFICATION OF LOAN AGREEMENT AND OTHER LOAN DOCUMENTS by and between IMPAC HOTEL GROUP MEZZANINE, LLC, SERVICO OPERATIONS MEZZANINE, LLC, LODGIAN FINANCING MEZZANINE, LLC, ISLAND MOTEL ENTERPRISES, INC., and PENMOCO, INC. as Mezzanine Borrowers and MERRILL LYNCH MORTGAGE LENDING, INC. as Mezzanine Lender Dated as of March 31, 2003 Modification Agreement(Mezzanine) THIS MODIFICATION OF LOAN AGREEMENT AND OTHER LOAN DOCUMENTS (this "AGREEMENT"), is made as of March 31, 2003, by the undersigned, each having an address c/o Lodgian, Inc., 3445 Peachtree Road, NE, Suite 700, Atlanta, Georgia 30326 (each, a "MEZZANINE BORROWER" and collectively, "MEZZANINE BORROWERS"), in favor of MERRILL LYNCH MORTGAGE LENDING, INC., a Delaware corporation (together with its successors and assigns, "MEZZANINE LENDER"), having an address at 4 World Financial Center, New York, New York 10080. RECITALS: WHEREAS, Mezzanine Lender previously made a loan in the principal sum of $78,671,201 (the "ORIGINAL MEZZANINE LOAN") to the Mezzanine Borrowers, which Original Mezzanine Loan (i) is evidenced by and advanced pursuant to the terms and provisions of that certain Mezzanine Note dated as of November 25, 2002, made by the Mezzanine Borrowers to Mezzanine Lender (the "ORIGINAL MEZZANINE NOTE") and the Mezzanine Loan Agreement dated as of November 25, 2002, among the Mezzanine Borrowers and Mezzanine Lender (the "MEZZANINE LOAN AGREEMENT") and (ii) is secured by, among other things, the Mezzanine Loan Documents (hereinafter defined); WHEREAS, Mortgage Lender (as defined in the Mezzanine Loan Agreement) previously made a loan in the principal sum of $224,036,325 (the "ORIGINAL MORTGAGE LOAN") to the Mortgage Borrowers (as defined in the Mezzanine Loan Agreement), which Original Mortgage Loan (i) is evidenced by and advanced pursuant to the terms and provisions of that certain Promissory Note dated as of November 25, 2002, made by the Mortgage Borrowers to Mortgage Lender (the "ORIGINAL MORTGAGE NOTE") and the Loan and Security Agreement dated as of November 25, 2002, among the Mortgage Borrowers and Mortgage Lender; WHEREAS, in connection with the Original Mezzanine Loan, Guarantor (as defined in the Mezzanine Loan Agreement) guaranteed to Mezzanine Lender repayment of the Original Mezzanine Loan and certain recourse obligations pursuant to and to the extent as described in the terms and provisions of the Guaranty (as defined in the Mezzanine Loan Agreement); WHEREAS, in connection with the Original Mezzanine Loan, Guarantor agreed to indemnify and hold Mezzanine Lender harmless from and against certain claims and obligations pursuant to and as described in the provisions of the Environmental Indemnity (as defined in the Mezzanine Loan Agreement); WHEREAS, at the time of origination of the Original Mezzanine Loan and the Original Mortgage Loan, each of the Mezzanine Borrowers and the Mortgage Borrowers agreed, in consideration of making the Mezzanine Loan and the Mortgage Loan prior to the final determination of sizing of the Original Mezzanine Loan and the Original Mortgage Loan, that prior to a Securitization the principal balance of the Original Mortgage Loan and the Original Mezzanine Loan may be adjusted in the sole discretion of Mortgage Lender and Mezzanine Lender (the "RESIZING"), subject to certain limitations with respect to, among other things, (i) changes in the weighted average interest rate and aggregate debt service payable on the Original Mezzanine Loan and the Original Mortgage Loan, and (ii) material changes to the rights or Modification Agreement(Mezzanine) obligations of the Mezzanine Borrowers and the Mortgage Borrowers under the Mezzanine Loan Documents and the Mortgage Loan Documents; WHEREAS, Mezzanine Lender and Mortgage Lender have elected to cause the Resizing to be effectuated pursuant to the terms hereof, and pursuant to certain additional documents executed and delivered by the Mezzanine Borrowers, the Mortgage Borrowers, Mezzanine Lender and Mortgage Lender, as applicable; WHEREAS, in connection with the Resizing, pursuant to the terms of that certain Note Severance Agreement dated as of the date hereof among the Mortgage Borrowers and Mortgage Lender, the Original Mortgage Note has been severed into two notes in the respective amounts of $218,127,000 (the "AMENDED AND RESTATED PROMISSORY NOTE A"), and $5,539,275 (the "ASSUMED NOTE"); WHEREAS, in connection with the Resizing, the Mezzanine Borrowers have assumed the repayment obligations under and pursuant to the terms of the Assumed Note; WHEREAS, in connection with the Resizing, Mortgage Lender has assigned all of its right, title and interest in and to the Assumed Note, but not the Amended and Restated Promissory Note A, to Mezzanine Lender and Mezzanine Lender has succeeded to all right, title and interest in and to the Assumed Note; WHEREAS, pursuant to the terms of that certain Amended, Restated and Consolidated Restated Mezzanine Note dated as of the date hereof, in the original principal amount of $84,080,526 made by the Mezzanine Borrowers in favor of Mezzanine Lender (the "RESTATED MEZZANINE NOTE"), the indebtedness under the Original Mezzanine Note and the Assumed Note have been combined, consolidated, coordinated, amended and restated in accordance with the terms of the Restated Mezzanine Note; WHEREAS, Mezzanine Lender is now the owner and holder of (i) that certain Pledge and Security Agreement, dated as of November 25, 2002 (as amended, modified or restated from time to time, the "PLEDGE AGREEMENT"), executed by certain of the Mezzanine Borrowers named therein, pledging such of the Mezzanine Borrowers' legal and beneficial interest in and to certain stock, limited liability company membership interests and limited and general partnership interests, as applicable, as more particularly described therein in favor of Mezzanine Lender, (ii) that certain Leasehold Deed to Secure Debt, Assignment of Leases and Rents and Security Agreement, dated as of November 25, 2002 (together with all extensions, renewals, modifications, substitutions and amendments thereof, the "SECURITY INSTRUMENT"), made by Island Motel Enterprises, Inc. and Penmoco, Inc. for the benefit of Lender and covering the property as more particularly described therein, and (iii) the Restated Mezzanine Note; WHEREAS, the Mezzanine Borrowers and Mezzanine Lender have agreed in the manner hereinafter set forth to modify the terms and provisions of the Mezzanine Loan Agreement, the Pledge Agreement, that certain Mezzanine Cash Management Agreement (the "CASH MANAGEMENT AGREEMENT") dated as of November 25, 2002, among the Mezzanine Borrowers, Mezzanine Lender and Wachovia Bank, National Association, and such other documents as are set forth on SCHEDULE 1 (such other documents, together with the Cash Management Agreement, 2 Modification Agreement(Mezzanine) collectively, the "OTHER LOAN DOCUMENTS", and together with the Mezzanine Loan Agreement, the Restated Mezzanine Note, the Pledge Agreement, and the Security Instrument, collectively, the "MEZZANINE LOAN DOCUMENTS") in the manner hereinafter set forth. NOW THEREFORE, in pursuance of said agreement and in consideration of ten dollars and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the Mezzanine Borrowers and Mezzanine Lender hereby agree as follows: A. The Recitals are hereby incorporated herein by this reference. B. The Mezzanine Loan Agreement shall be deemed modified and amended in the following respects: (i) The term "NOTE" as used in the Mezzanine Loan Agreement shall refer to the Restated Mezzanine Note. (ii) The term "LOAN" as used in the Mezzanine Loan Agreement shall refer to a loan in the original principal amount of $84,080,526 as the same may be decreased from time to time. (iii) The definition of "APPLICABLE SPREAD" set forth in Section 1.1 of the Mezzanine Loan Agreement shall be deemed deleted in its entirety and replaced with the following: "APPLICABLE SPREAD" means 8.2546%; provided, however, if the Borrowers have not made the Reserve Principal Payment on or prior to the Payment Date in November 2003, the "APPLICABLE SPREAD" shall mean 8.7937% throughout the remainder of the term of the Loan, including any Extension Terms. (iv) The definition of "MEZZANINE LENDER'S PERCENTAGE" set forth in Section 1.1 of the Mezzanine Loan Agreement shall be deemed deleted in its entirety and replaced with the following: "MEZZANINE LENDER'S PERCENTAGE" shall mean, if the Mortgage Loan remains outstanding at the time of determination, the ratio, expressed as a percentage, that the then outstanding principal balance of the Mezzanine Loan bears to the Aggregate Outstanding Principal Balance, and following satisfaction of the Mortgage Loan, 100%. As of the date hereof Mezzanine Lender's Percentage is 27.82%. (v) The definition of "MORTGAGE LENDER'S PERCENTAGE" set forth in Section 1.1 of the Mezzanine Loan Agreement shall be deemed deleted in its entirety and replaced with the following: "MORTGAGE LENDER'S PERCENTAGE" shall mean, at the time of determination, the ratio, expressed as a percentage, that the outstanding 3 Modification Agreement(Mezzanine) principal balance of the Mortgage Loan bears to the Aggregate Outstanding Principal Balance. As of the date hereof, Mortgage Lender's Percentage is 72.18%. (vi) The definition of "MORTGAGE LOAN" set forth in Section 1.1 of the Mezzanine Loan Agreement shall be deemed deleted in its entirety and replaced with the following: "MORTGAGE LOAN" means that certain loan in the amount of $218,127,000 from Mortgage Lender to the Mortgage Borrowers. (vii) The definition of "SCHEDULED MEZZANINE PRINCIPAL PAYMENTS" set forth in Section 1.1 of the Mezzanine Loan Agreement shall be deemed deleted in its entirety and replaced with the following: "SCHEDULED MEZZANINE PRINCIPAL PAYMENTS" shall mean (x) $69,550 through and including the Payment Date in November 2003, (y) $104,325 following the Payment Date in November 2003, through and including the Payment Date in November 2004, and (z) $139,100 thereafter through the Maturity Date. (viii) The definition of "SCHEDULED MORTGAGE PRINCIPAL PAYMENTS" set forth in Section 1.1 of the Mezzanine Loan Agreement shall be deemed deleted in its entirety and replaced with the following: "SCHEDULED MORTGAGE PRINCIPAL PAYMENTS" shall mean (x) $180,450 through and including the Payment Date in November 2003, (y) $ 270,675 following the Payment Date in November 2003, through and including the Payment Date in November 2004, and (z) $360,900 thereafter through the Maturity Date. (ix) Section 2.1(A) and (B) of the Mezzanine Loan Agreement shall be deemed modified and amended by replacing all references therein to the figure "$78,671,201" with the figure "$84,080,526." (x) Sections 2.4(A)(iv) and 2.6(C) of the Mezzanine Loan Agreement shall be deemed modified and amended by replacing all references therein to the word "prior" with the words "on or prior". (xi) Section 2.6(B) of the Mezzanine Loan Agreement shall be deemed modified and amended by deleting the final sentence thereof and inserting the following: "PREPAYMENT CONSIDERATION" shall mean an amount equal to (i) prior to the Payment Date in December 2003, three percent (3%) of the amount prepaid, and (ii) on and after the Payment Date in December 2003, but prior to the Payment Date in May 2004, two percent (2%) of the amount 4 Modification Agreement(Mezzanine) prepaid, and (iii) thereafter through the Scheduled Maturity Date one percent (1%) of the amount prepaid. (xii) EXHIBIT A captioned "Allocated Loan Amount/Aggregate Allocated Loan Amount" of the Mezzanine Loan Agreement shall be deemed deleted in its entirety and replaced with EXHIBIT A annexed hereto and made a part hereof C. The Other Loan Documents shall each be deemed modified and amended in the following respects: (i) The terms "NOTE" and "MEZZANINE NOTE" as used in the Other Loan Documents shall be deemed to refer to the Restated Mezzanine Note. (ii) The terms "LOAN" and "MEZZANINE LOAN" as used in the Other Loan Documents shall be deemed to refer to a loan in the original principal amount of $84,080,526 as the same may be decreased from time to time. (iii) All references in the Other Loan Documents to the figure "$78,671,526" shall be deemed to refer to the figure "$84,080,526". (iv) All references in the Other Loan Documents to the figure "$224,036,325" shall be deemed to refer to the figure "$218,127,000". D. The Cash Management Agreement shall be deemed further modified and amended in the following respects: (i) The definition of "MONTHLY FF&E PAYMENT" set forth in Article I of the Cash Management Agreement shall be deemed deleted in its entirety and replaced with the following: "MONTHLY FF&E PAYMENT" shall mean the monthly deposit required to be made to the FF&E Reserve pursuant to Section 6.4 of the Mortgage Loan Agreement; provided that if at the time of determination thereof the actual Operating Revenues utilized in calculating the Monthly FF&E Payment have not been determined for the applicable month, such calculation shall be based upon the Operating Revenues set forth for such month in the applicable Operating Budget, and, upon determination of the actual Operating Revenues for such month, any deficit or excess deposits with respect to the FF&E Reserve shall be adjusted within five (5) Business Days of such determination, with any deficit being satisfied, and any excess being allocated and deposited, in accordance with Section 3.3(a) hereof. (ii) The definition of "MONTHLY OPERATING EXPENSE BUDGET AMOUNT" set forth in Article I of the Cash Management Agreement shall be deemed deleted in its entirety and replaced with the following: 5 Modification Agreement(Mezzanine) "MONTHLY OPERATING EXPENSE BUDGET AMOUNT" shall mean, with respect to each month, an amount equal to the Operating Expenses plus estimated sales and similar taxes relating to the Properties (excluding therefrom Impositions, Insurance Premiums, FF&E expenditures, and management fees payable to any Manager that is an Affiliate of the Borrowers) set forth in the Approved Operating Budget for the applicable month of determination. (iii) Section 2.1(f) of the Cash Management Agreement shall be deemed modified and amended by replacing all references therein to "Section 3.3(a)(iv)" with the reference to "Section 3.3(a)(iii)". (iv) Section 3.3(a) of the Cash Management Agreement shall be deemed deleted in its entirety and replaced with the following: (a) At any time other than after the occurrence and during the continuance of an Event of Default, Agent shall allocate and distribute, as applicable, all available funds on deposit in the Mezzanine Lock Box Account on each Business Day of each calendar month (or such other period of time as set forth below) in the following amounts and order of priority: (i) First, but only from and after the Termination Date, to the Impositions and Insurance Reserve Sub-Account, the Monthly Impositions and Insurance Amount for the next Monthly Payment Date (as if the Mortgage Loan Agreement remained in full force and effect with Lender as the lender thereunder); (ii) Second, but only to the extent not deposited in the Mezzanine Loan Debt Service Sub-Account established under the Mortgage Loan Cash Management Agreement, to the Mezzanine Debt Service Sub-Account, the Monthly Debt Service Payment Amount, less Mezzanine Lender's Percentage of the Excess Cash Flow Amortization Payment and the Excess Cash Flow Supplemental Payment for the next Monthly Payment Date; (iii) Third, but only from and after the Termination Date, to the FF&E Reserve Account, the Monthly FF&E Payment for the next Monthly Payment Date (as if the Mortgage Loan Agreement remained in full force and effect with Lender as the lender thereunder); (iv) Fourth, but only from and after the Termination Date, to the Operating Expense Sub-Account funds sufficient to pay the 6 Modification Agreement(Mezzanine) Monthly Operating Expense Budget Amount for the next calendar Month; (v) Fifth, but only from and after the Termination Date, to the Operating Expense Sub-Account, funds in an amount necessary to pay Extraordinary Expenses approved by Lender, if any; (vi) Sixth, but only from and after the Termination Date, to the Operating Expense Sub-Account, subject to the terms and conditions of the Assignment of Management Agreement (as defined in the Mortgage Loan Agreement, and as if such agreement continued in full force and effect with the Lender as lender thereunder), any management fees due and owing to Manager which have not previously been paid to Manager, together with any fees payable to Manager for the next calendar month pursuant to the Management Agreement (including those with respect to the Jekyll Island Property) not otherwise paid pursuant to (iv) above; (vii) Seventh, but only to the extent not deposited in the Mezzanine Loan Debt Service Sub-Account established under the Mortgage Loan Cash Management Agreement, to the Mezzanine Debt Service Sub-Account, Mezzanine Lender's Percentage of the Excess Cash Flow Amortization Payment and the Excess Cash Flow Supplemental Payment for the next Monthly Payment Date; (viii) Eighth, but only from and after the Termination Date, if a Cash Trap Event shall have occurred and is continuing, any amounts remaining in the Mezzanine Lock Box Account after deposits for items (i) through (vii) above shall be deposited into the Cash Trap Reserve Sub-Account; and (ix) Ninth, if no Cash Trap Event shall have occurred and is continuing, any amounts remaining in the Mezzanine Lock Box Account after deposits for items (i) through (vii) above shall be (x) first deposited into the Jekyll Island Lock Box Account, if the Jekyll Island Mortgage remains a lien on the Jekyll Island Property, until all deposits required to be made on such Monthly Payment Date for items (i) through (iv) of Section 3.3(a) of the Jekyll Island Cash Management Agreement have been deposited in the Jekyll Island Lock Box Account, and (y) thereafter, paid within one (1) Business Day of the date such funds become available, to, or as directed by, the Borrowers. 7 Modification Agreement(Mezzanine) (v) Sections 3.3(c) and 3.3(d) of the Cash Management Agreement shall be deemed deleted in their entirety and replaced with the following: (c) The Borrowers shall use, or caused to be used, all disbursements made to it under Sections 3.3(a)(iv) and (v) solely to pay Operating Expenses in accordance with the Approved Operating Budget and to pay Extraordinary Expenses for which Lender has approved disbursements under Section 3.3(a)(v) above. (d) Notwithstanding anything to the contrary contained herein, Lender shall not be obligated to make any disbursement from the Mezzanine Lock Box Account (under Sections 3.3(a)(iv) and (v) or otherwise) to pay for any costs or expenses (including legal fees) in connection with any dispute or defense of the Borrowers under any of the Loan Documents. (vi) Section 3.4 of the Cash Management Agreement shall be deemed deleted in its entirety and replaced with the following: SECTION 3.4 DISBURSEMENTS FOR OPERATING EXPENSE AMOUNTS. The Borrowers shall provide on a monthly basis (a) a reasonably detailed explanation of any variances of ten percent (10%) or more between budgeted (as set forth in the Approved Operating Budget) and actual Operating Expense amounts for any month in the aggregate, and (b) with respect to any individual item with a cost of $10,000 or more and not otherwise covered by the Approved Operating Budget, all invoices or other backup requested by Lender to substantiate the amount disbursed to the Borrowers pursuant to Section 3.3(a)(iv) and (v). (vii) Section 4.1(c) the Cash Management Agreement shall be deemed deleted in its entirety and replaced with the following: (c) Operating Expense Sub-Account. Funds deposited into the Operating Expense Sub-Account pursuant to Sections 3.3(a)(iv) through (vi) shall be distributed to the Borrowers on each Business Day. (viii) Section 8.4 of the Cash Management Agreement shall be deemed modified and amended by inserting as the first sentence thereof the following: Agent shall deduct for its own account the monthly Servicing Fee for which the Borrowers are responsible pursuant to Section 2.11 of the Mezzanine Loan Agreement from the Lock Box Account prior to making any disbursements pursuant to Section 3.3(a)(ii) hereof. E. The Mezzanine Borrowers and Mezzanine Lender acknowledge and agree that Mezzanine Lender has waived any amortization payment required pursuant to Section 2.4(A) of the Mezzanine Loan Agreement for the Payment Date in March 2003 only. Notwithstanding the 8 Modification Agreement(Mezzanine) foregoing to the contrary, the Mezzanine Borrowers acknowledge and agree that the aggregate amount of the Scheduled Mezzanine Principal Payments (with the Scheduled Mezzanine Principal Payment for the Payment Date in March 2003 being deemed to be $64,975) through the Payment Date in March 2003 is $259,900, and further acknowledge and agree that the aggregate of all principal payments made by the Mezzanine Borrowers through the Payment Date in March 2003 is $129,950, and therefore the aggregate Amortization Deficiency through the Payment Date in March 2003 shall be deemed to be $129,950. Further, the Mezzanine Borrowers shall cause the Mortgage Borrowers to retain any Excess Cash Flow accruing during the month of March 2003, which such amounts shall be (i) included in calculating Excess Cash Flow for the month of April 2003 for all intents and purposes under the Mezzanine Loan Documents, and (ii) applied (together with any Excess Cash Flow accruing during the month of April 2003) in accordance with Section 2.4(A) of the Mezzanine Loan Agreement. F. The Mezzanine Borrowers acknowledge and agree that the Mezzanine Loan shall continue to be evidenced by and payable in accordance with the provisions of the Restated Mezzanine Note and the Mezzanine Loan Agreement, as hereby confirmed, modified and amended. The Mezzanine Borrowers hereby agree to perform all of the terms, covenants and provisions contained in the Restated Mezzanine Note and the Mezzanine Loan Agreement, as hereby confirmed, modified and amended. G. The Mezzanine Borrowers represent and warrant that, to the Mezzanine Borrowers' Knowledge, as of the date hereof, there are no Events of Default under any of the terms, covenants or provisions of the Mezzanine Loan Documents and the Mezzanine Borrowers know of no event which, but for the passage of time or the giving of notice or both, would constitute an Event of Default under the Mezzanine Loan Documents. H. The Mezzanine Borrowers represent, warrant and covenant that, to the Mezzanine Borrowers' Knowledge, there are no offsets, counterclaims or defenses to the Obligations, this Agreement, or the Mezzanine Loan Documents and that the Mezzanine Borrowers (and the undersigned representatives of the Mezzanine Borrowers) have full power, authority and legal right to execute this Agreement and keep and observe all of the terms of this Agreement on the Mezzanine Borrowers' part to be observed or performed. I. Except as expressly modified pursuant to this Agreement, all of the terms, covenants and provisions of the Mezzanine Loan Documents shall continue in full force and effect. In the event of any conflict between any of the terms, covenants and provisions of this Agreement and those of the Mezzanine Loan Documents, the terms, covenants and provisions of this Agreement shall control. J. No amendment or waiver of any term, covenant or provision of this Agreement nor consent to any departure by the Mezzanine Borrowers from the terms, covenants or provisions of this Agreement shall be effective unless the same shall be in writing and signed by Mezzanine Lender and, in the case of an amendment, the Mezzanine Borrowers and any such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. 9 Modification Agreement(Mezzanine) K. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. L. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Agreement by signing any such counterpart. M. All capitalized terms not otherwise defined herein shall have the meaning set forth in the Mezzanine Loan Agreement. N. THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THE STATE OF NEW YORK AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. [NO ADDITIONAL TEXT ON THIS PAGE] 10 Modification Agreement(Mezzanine) IN WITNESS WHEREOF, the undersigned Mezzanine Borrowers and Mezzanine Lender have executed this Agreement as of the day and year first written above. MEZZANINE BORROWERS: IMPAC HOTEL GROUP MEZZANINE, LLC, a Delaware limited liability company By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary SERVICO OPERATIONS MEZZANINE, LLC, a Delaware limited liability company By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary LODGIAN FINANCING MEZZANINE, LLC, a Delaware limited liability company By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary ISLAND MOTEL ENTERPRISES, INC., a Georgia corporation By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary Modification Agreement(Mezzanine) PENMOCO, INC., a Michigan corporation By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary MEZZANINE LENDER: MERRILL LYNCH MORTGAGE LENDING, INC., a Delaware corporation By: /s/ Steven Glassman -------------------------------------- Name: Steven Glassman Title: Authorized Signatory Modification Agreement(Mezzanine) CONSENT OF GUARANTOR The undersigned has executed this Agreement in order to signify its consent to the execution and delivery of this Agreement and the Restated Mezzanine Note by the Mezzanine Borrowers and its agreement to be bound by the terms hereof to the extent applicable. The undersigned hereby ratifies and confirms the Guaranty and the Environmental Indemnity, as each have been amended and modified by this Agreement, and acknowledges that to its Knowledge there are no offsets, counterclaims or defenses of any nature whatsoever to its obligations and liabilities under either of the Guaranty or the Environmental Indemnity, as each have been amended and modified by this Agreement. Dated: March 31, 2003 GUARANTOR: LODGIAN, INC. a Delaware corporation By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary Modification Agreement(Mezzanine) ACKNOWLEDGEMENT OF PLEDGED SUBSIDIARIES The undersigned hereby acknowledge receipt of a copy of the foregoing Agreement, and acknowledge that the Acknowledgement given pursuant to the Pledge Agreement remains in full force and effect and unmodified and that, to the extent required by applicable law, the security interests granted under such Pledge Agreement have been noted in each of the undersigned's books, and agrees that it will comply with instructions originated by the Mezzanine Lender without further consent by Pledgor, and waives any rights or requirement at any time hereafter to receive a copy of such Pledge and Security Agreement in connection with the registration of any Collateral in the name of the Lender or its nominee or the exercise of voting rights by the Mezzanine Lender or its nominee. ALBANY HOTEL, INC., a Florida corporation, APICO HILLS, INC., a Pennsylvania corporation, APICO INNS OF GREEN TREE, INC., a Pennsylvania corporation, BRUNSWICK MOTEL ENTERPRISES, INC., a Georgia corporation, DOTHAN HOSPITALITY 3053, INC., an Alabama corporation, DOTHAN HOSPITALITY 3071, INC., an Alabama corporation, GADSDEN HOSPITALITY, INC., an Alabama corporation, LODGIAN AMI, INC., a Maryland corporation, MINNEAPOLIS MOTEL ENTERPRISES, INC., a Minnesota corporation, NH MOTEL ENTERPRISES, INC., a Michigan corporation, SERVICO AUSTIN, INC., a Texas corporation, SERVICO CEDAR RAPIDS, INC., an Iowa corporation, Modification Agreement(Mezzanine) SERVICO COLUMBIA, INC., a Maryland corporation, SERVICO GRAND ISLAND, INC., a New York corporation, SERVICO HOUSTON, INC., a Texas corporation, SERVICO JAMESTOWN, INC., a New York corporation, SERVICO LANSING, INC., a Michigan corporation, SERVICO MARKET CENTER, INC., a Texas corporation, SERVICO MARYLAND, INC., a Maryland corporation, SERVICO METAIRIE, INC., a Louisiana corporation, SERVICO NEW YORK, INC., a New York corporation, SERVICO NIAGARA FALLS, INC., a New York corporation, SERVICO NORTHWOODS, INC., a Florida corporation, SERVICO PENSACOLA 7200, INC., a Delaware corporation, SERVICO PENSACOLA 7330, INC., a Delaware corporation, SERVICO PENSACOLA, INC., a Delaware corporation, SERVICO ROLLING MEADOWS, INC., an Illinois corporation, Modification Agreement(Mezzanine) SERVICO WINTER HAVEN, INC., a Florida corporation, SHEFFIELD MOTEL ENTERPRISES, INC., an Alabama corporation, IMPAC HOTELS I, L.L.C., a Georgia limited liability company, and LODGIAN MEMPHIS PROPERTY OWNER, LLC, a Delaware limited liability company By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary or authorized signatory of the above entities AMI OPERATING PARTNERS, L.P., a Delaware limited partnership By: AMIOP ACQUISITION GENERAL PARTNER SPE CORP., a Delaware corporation, its General Partner By: /s/ Daniel E. Ellis ---------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary DEDHAM LODGING ASSOCIATES I, LIMITED PARTNERSHIP, a Georgia limited partnership By: DEDHAM LODGING SPE, INC., a Delaware corporation, its General Partner By: /s/ Daniel E. Ellis ---------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary LITTLE ROCK LODGING ASSOCIATES I, LIMITED PARTNERSHIP, a Georgia limited partnership Modification Agreement(Mezzanine) By: LODGIAN LITTLE ROCK SPE, INC., a Delaware corporation, its General Partner By: /s/ Daniel E. Ellis ---------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary ISLAND MOTEL ENTERPRISES, INC., a Georgia corporation By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary PENMOCO, INC., a Michigan corporation By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary IMPAC HOTELS MEMBER SPE, INC., a Delaware corporation By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary LODGIAN LITTLE ROCK SPE, INC., a Delaware corporation By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary SERVICO COLUMBIA II, INC., a Maryland corporation Modification Agreement(Mezzanine) By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary IMPAC HOTELS I, L.L.C., a Georgia limited liability company By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary SERVICO PALM BEACH MOTEL GENERAL PARTNER SPE, INC., a Delaware corporation, By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary AMIOP ACQUISITION GENERAL PARTNER SPE CORP., a Delaware corporation By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: Vice President and Secretary Modification Agreement(Mezzanine) ACKNOWLEDGEMENT OF CERTAIN LIMITED PARTNERSHIP AND LIMITED LIABILITY COMPANY PLEDGED SUBSIDIARIES The undersigned have executed this Agreement in order to ratify and confirm that each Control Acknowledgement dated as of November 25, 2002, executed by the undersigned remains in full force and effect following the execution and delivery of this Agreement. IMPAC HOTELS I, L.L.C. a Georgia limited liability company By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: VP and Secretary LODGIAN MEMPHIS PROPERTY OWNER, LLC a Delaware limited liability company By: /s/ Daniel E. Ellis -------------------------------------- Name: Daniel E. Ellis Title: VP and Secretary AMI OPERATING PARTNERS, L.P. a Delaware limited partnership By: AMIOP ACQUISITION GENERAL PARTNER SPE CORP., a Delaware corporation, its General Partner. By: /s/ Daniel E. Ellis ---------------------------------- Name: Daniel E. Ellis Title: VP and Secretary LITTLE ROCK LODGING ASSOCIATES, LIMITED PARTNERSHIP, a Georgia limited partnership By: LODGIAN LITTLE ROCK SPE, INC., a Delaware corporation, its General Partner By: /s/ Daniel E. Ellis ---------------------------------- Name: Daniel E. Ellis Title: VP and Secretary Modification Agreement(Mezzanine) DEDHAM LODGING ASSOCIATES I, LIMITED PARTNERSHIP, a Georgia limited liability company By: /s/ Daniel E. Ellis ------------------------------------- Name: Daniel E. Ellis Title: VP and Secretary Modification Agreement(Mezzanine) ACKNOWLEDGEMENT OF AGENT The undersigned has executed this Agreement in order to signify its agreement to be bound by the terms hereof to the extent applicable with respect to the Cash Management Agreement and the Jekyll Island Cash Management Agreement only, and for no other purpose. Dated: March 31, 2003 AGENT: WACHOVIA BANK, NATIONAL ASSOCIATION By: /s/ David F. Sisom ------------------------------------- Name: David F. Sisom Title: Vice President Modification Agreement(Mezzanine) ACKNOWLEDGEMENT OF MANAGER The undersigned has executed this Agreement in order to signify its agreement to be bound by the terms hereof to the extent applicable with respect to the Cash Management Agreement, the Jekyll Island Cash Management Agreement, the Assignments of Management Agreements, and any of the other Mezzanine Loan Documents to which Manager is a party. Dated: March 31, 2003 MANAGER: LODGIAN MANAGEMENT CORP. By: /s/ Daniel E. Ellis ------------------------------------- Name: Daniel E. Ellis Title: Vice President Modification Agreement(Mezzanine) SCHEDULE 1 OTHER LOAN DOCUMENTS 1. Pledge Agreement 2. Guaranty 3. Environmental Indemnity 4. Conditional Assignment of Hotel Management Agreement (Mezzanine Loan) by Manager the Mezzanine Borrowers in favor of Mezzanine Lender 5. Jekyll Island Mortgage 6. Jekyll Island Assignment of Leases and Rents 7. Assignment of Agreements, Licenses, Permits and Contracts (Jekyll Island) by Penmoco, Inc. and Island Motel Enterprises, Inc. to Mezzanine Lender 8. Mezzanine Cash Management Agreement (Jekyll Island) among Penmoco, Inc., Island Motel Enterprises, Inc., Manager and Mezzanine Lender 9. Conditional Assignment of Hotel Management Agreement (Jekyll Island Property) among Penmoco, Inc., Island Motel Enterprises, Inc., Manager and Mezzanine Lender 10. Post-Closing Agreement given by the Mezzanine Borrowers Modification Agreement(Mezzanine) EXHIBIT A ALLOCATED LOAN AMOUNT/AGGREGATE ALLOCATED LOAN AMOUNT
AGGREGATE PROPERTY ALLOCATED LOAN ALLOCATED NUMBER CHAIN/NAME CITY STATE AMOUNT LOAN AMOUNT -------------------------------------------------------------------------------------------------------------------- 210 Holiday Inn Sheffield AL $ 835,105.69 $ 3,037,891 220 Holiday Inn Dothan AL $ 252,473.82 $ 918,432 230 Dothan Plaza Hotel Dothan (Ex Hampton) AL $ 603,123.65 $ 2,194,003 240 Holiday Inn Express Attalla (Gadsden) AL $ 466,105.50 $ 1,695,567 505 Courtyard by Marriott Bentonville AR $ 1,553,685.00 $ 5,651,891 560 Residence Inn Little Rock AR $ 1,242,948.00 $ 4,521,513 850 Holiday Inn East Hartford CT $ 640,895.05 $ 2,331,405 1108 Crowne Plaza West Palm Beach FL $ 1,942,106.24 $ 7,064,863 1113 Holiday Inn Express Pensacola FL $ 602,052.94 $ 2,190,108 1116 Holiday Inn Pensacola (University Mall) FL $ 971,053.13 $ 3,532,432 1132 Holiday Inn Winter Haven FL $ 1,320,632.25 $ 4,804,107 1168 Holiday Inn Express Pensacola (Ex Hampton) FL $ 1,137,336.71 $ 4,137,327 1206 Holiday Inn Brunswick GA $ 757,421.44 $ 2,755,297 1212 Courtyard by Marriott Atlanta GA $ 3,665,316.68 $ 13,333,442 1255 Holiday Inn Marietta (hotel & suites) GA $ 427,263.38 $ 1,554,270 1280 Fairfield Inn Valdosta GA $ 971,053.13 $ 3,532,432 1285 Holiday Inn Valdosta GA $ 640,895.05 $ 2,331,405 1310 Holiday Inn Rolling Meadows IL $ 1,825,579.88 $ 6,640,972 1502 Quality Hotel Metairie LA $ 718,579.32 $ 2,613,999 1710 Hilton Columbia MD $ 2,136,316.88 $ 7,771,350 1720 Holiday Inn Silver Spring MD $ 4,592,709.47 $ 16,707,049 1765 Holiday Inn Baltimore, Inner Harbor MD $ 6,408,950.62 $ 23,314,049 1770 Holiday Inn Glen Burnie MD $ 1,029,316.32 $ 3,744,378 1775 Holiday Inn Baltimore - BWI Airport MD $ 4,466,844.37 $ 16,249,186 1776 Holiday Inn Frederick MD $ 990,474.19 $ 3,603,080 1780 Holiday Inn Towson (Cromwell Bridge) MD $ 1,359,474.37 $ 4,945,404 1785 Holiday Inn Baltimore West (Belmont) MD $ 466,105.50 $ 1,695,567 1840 Crowne Plaza Cedar Rapids IA $ 1,398,316.50 $ 5,086,702 1910 Holiday Inn Arden Hills/St. Paul MN $ 1,340,053.31 $ 4,874,756 2007 Courtyard by Marriott Paducah KY $ 1,107,000.57 $ 4,026,972 2035 Courtyard by Marriott Florence KY $ 738,000.37 $ 2,684,648 2040 Hurstbourne Hotel Louisville KY $ 758,224.48 $ 2,758,218 2222 Holiday Inn St. Louis North MO $ 1,553,685.00 $ 5,651,891 2777 Residence Inn Dedham MA $ 1,942,106.24 $ 7,064,863 3311 Crowne Plaza Albany NY $ 4,792,392.49 $ 17,433,443 3314 Holiday Inn Select Niagara Falls NY $ 1,456,579.69 $ 5,298,648 3326 Four Points Niagara Falls NY $ 485,526.55 $ 1,766,216 3330 Holiday Inn Jamestown NY $ 1,048,737.37 $ 3,815,026 3345 Holiday Inn Grand Island NY $ 252,473.82 $ 918,432 3515 Holiday Inn Select Strongsville OH $ 1,942,106.24 $ 7,064,863 3802 Holiday Inn Greentree PA $ 1,398,316.50 $ 5,086,702 3804 Holiday Inn Pittsburgh (Pkwy East) PA $ 524,368.70 $ 1,907,513 3838 Doubletree Club Philadelphia PA $ 2,494,699.37 $ 9,075,049 3875 Holiday Inn York PA $ 718,579.32 $ 2,613,999 3890 Holiday Inn Lancaster PA $ 990,474.19 $ 3,603,080 3930 Hilton Troy (Northfield) MI $ 2,196,513.22 $ 7,990,328 3970 Holiday Inn Lansing MI $ 2,563,580.25 $ 9,325,620 4021 Clarion Charleston SC $ 330,158.05 $ 1,201,027 4040 Holiday Inn SunSpree Myrtle Beach SC $ 1,087,579.49 $ 3,956,324 4215 French Quarter Suites Memphis TN $ 559,641.87 $ 2,035,828 4310 Crowne Plaza Houston TX $ 4,078,423.12 $ 14,836,213 4343 Courtyard by Marriott Abilene TX $ 1,145,842.69 $ 4,168,269 4375 Holiday Inn Austin TX $ 1,048,737.37 $ 3,815,026 4380 Holiday Inn Dallas (Mkt Center) TX $ 388,421.25 $ 1,412,973 4388 Holiday Inn Select Dallas (DFW Airport) TX $ 2,330,527.50 $ 8,477,836 Jekyll Island $ 1,385,641.92 $ 1,385,642 TOTAL 56 PROPERTIES $84,080,526.00 $302,207,526
Modification Agreement(Mezzanine)