Environmental Indemnity Agreement

Exhibit 10.2(f)


ENVIRONMENTAL INDEMNITY AGREEMENT


THIS ENVIRONMENTAL INDEMNITY AGREEMENT (this "Agreement"), dated as of May 30, 2000, is made by SONESTA BEACH RESORT LIMITED PART'NERSHIP, a Delaware limited partnership ("Borrower"), and SONESTA INTERNATIONAL HOTELS CORPORATION., a New York corporation ("Guarantor," and, together with Borrower, the "Indemnitor"), for the benefit of SUNAMERICA LIFE INSURANCE COMPANY, an Arizona corporation.("Lender"), and the other "Indemnitees" as hereinafter defined.


RECITALS


A. Lender has agreed to make a loan to Borrower in the amount of $31,000,000.00 (the "Loan") to be evidenced by a Consolidated and Renewed Promissory Note of even date herewith made by Borrower to the order of Lender (the "Note") and secured by, among other things, a Consolidated, Amended and Restated Mortgage, Security Agreement Fixture Filing, Financing Statement and Assignment of Leases and Rents of even date herewith granted by Borrower for the benefit of Lender (the "Mortgage") covering certain real property more specifically described in the Mortgage (the "Property") and guaranteed by a Limited Guaranty Agreement of even date herewith by Guarantor for the benefit of Lender (the "Guaranty"). All capitalized terms used herein without definition shall have the meanings given to such terms in the Mortgage.


B. Borrower is the owner of a fee simple estate in the Property.


C. As a condition precedent to making the Loan, Lender requires that Indemnitor enter into this Agreement, whose covenants and obligations are independent of and in addition to Borrower's obligations under the Note, Mortgage and the other documents governing, evidencing and securing the Loan and Guarantor's obligations under the Guaranty.


NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Indemnitor hereby represents, warrants and covenants to Lender and Lender's officers, directors, employees, agents, affiliates, successors and assigns (collectively, the "Indemnitees") as follows:


Section 1. Representations and Warranties. Indemnitor represents and warrants to the Indemnitees that:


(a) to the best of Indemnitor's knowledge, Hazardous Substances have not at any time been generated, used, treated or stored on, or transported to or from the Property in any quantity or manner which violates any Environmental Law;


(b) to the best of Indemnitor's knowledge, Hazardous Substances have not at any time been Released or disposed of on the Property in any quality or manner which violates any Environmental Law;


(c) to the best of Indemnitor's knowledge, Borrower is in compliance with all applicable Environmental Laws with respect to the Property and the requirements of any permits issued under such Environmental Laws with respect to the Property;


(d) there are no past, pending or, to the best of Indemnitor's knowledge, threatened Environmental Claims against Indemnitor or the Property.


(e) to the best of Indemnitor's knowledge, there is no condition or occurrence at the Property that could reasonably be anticipated (i) to form the basis of any Environmental Claim against Indemnitor or the Property, or (ii) to cause the Property to be subject to any restrictions on the ownership, occupancy, use or transferability thereof under any Environmental Law;


(f) except as otherwise disclosed in the Environmental Report (hereinafter defined), to the best of Indemnitor's knowledge, there are not now and never have been any underground storage tanks located on the Property;


(g) Borrower (i) is a limited partnership, duly organized, validly existing and in good standing under the laws of the State of Delaware, (ii) has the power and authority to own its property and assets and to transact the business in which it is engaged and (iii) is duly qualified as a foreign limited partnership and is in good standing in each jurisdiction in which it owns or leases property, including Florida, or in which failure to be duly qualified and in good standing would have an adverse effect on its business, operations, property or financial condition;


(h) Guarantor (i) is a corporation, duly organized; validly existing and in good standing under the laws of the State of New York, (ii) has the power and authority to own its property and assets and to transact the business in which it is engaged and (iii) is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which it owns or leases property or in which failure to be duly qualified and in good standing would have an adverse effect on its business, operations, property or financial condition;


(i) Indemnitor has the power to execute, deliver and perform the terms and provisions of this Agreement and has taken all necessary action to authorize the execution, delivery and performance by it of this Agreement;


(j) Indemnitor has duly executed and delivered this Agreement, and this Agreement constitutes its legal, valid and binding obligation enforceable against Indemnitor in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency, reorganization and other laws affecting creditors' rights generally and by principles of equity;


(k) neither the execution, delivery or performance by Indemnitor of this Agreement, nor compliance by it with the terms and provisions hereof, will (i) contravene any provision of any law, statute, rule or regulation or any order, writ, injunction or decree of any court or governmental instrumentality, (ii) result in any breach of any of the terms, covenants, conditions or provisions of, or constitute a default under, or result in the creation or imposition of (or the obligation to create or impose) any lien upon any of its property or assets pursuant to the terms of any indenture,


mortgage, deed of trust, credit agreement, loan agreement or any other agreement, contract or instrument to which it is a party or by which it or any of its property or assets is bound or to which it may be subject, or (iii) violate any provision of any organizational document under which any Indemnitor has been formed or operates under applicable law;


(1) no order, consent, approval, license, authorization or validation of, or filing, recording or registration with, or exemption by, any governmental or public body or authority, or any subdivision thereof, is required to authorize, or is required in connection with, the execution, delivery and performance by Indemnitor of this Agreement or the legality, validity, binding effect or enforceability of this Agreement; and


(m) to the best of Indemnitor's knowledge, Borrower is in compliance with all applicable statutes, regulations and orders of, and all applicable restrictions imposed by all governmental bodies in respect of the conduct of its business and the ownership of its property.


Section 2. Covenants. Indemnitor covenants and agrees as follows:


(a) Indemnitor will (i) comply with all Environmental Laws applicable to the ownership or use of the Property, (ii) use its best efforts to cause all tenants and other persons occupying the Property to comply with all Environmental Laws, (iii) immediately pay or cause to be paid all costs and expenses incurred in such compliance, and (iv) keep or cause the Property to be kept free and clear of any liens imposed thereon pursuant to any Environmental Laws. Notwithstanding clause (i) of the preceding sentence, Indemnitor will not be deemed to be in default solely by reason of Indemnitor's failure to comply with an Environmental Law applicable to the ownership or use of the Property so long as, in Lender's judgment, each of the following conditions is satisfied:


(A) Indemnitor is engaged in and diligently pursuing in
good faith administrative or judicial proceedings appropriate to contest
the validity or applicability to the ownership or use of the Property of
such Environmental Law; and


(B) Indemnitor's noncompliance with such Environmental
Law will not result in either (1) the loss or forfeiture of any property
encumbered by the Mortgage or any interest of Lender therein, or (2) any
diminution in the value of the Property, as determined by Lender; and


(C) Indemnitor deposits with Lender such security as
Lender requires to protect the Indemnitees against all loss, damage and
expense, including reasonable attorneys' fees, which Indemnitees might
incur if the subject Environmental Law is determined to be valid or
applicable.


If Lender determines that any one or more of such conditions is not satisfied or is no longer satisfied, Indemnitor shall comply with the subject Environmental Law (or commence and then diligently pursue compliance with such Environmental Law if such compliance cannot be accomplished within ten (10) days) within ten (10) days after Lender gives notice of such determination.


(b) Indemnitor will not generate, use, treat, store, Release or dispose or permit the generation, use, treatment, storage, Release or disposal of any Hazardous Substances on the Property, or transport or permit the transportation of any Hazardous Substances to or from the Property, in each case in any quantity or manner which violates any Environmental Law.


(c) If Lender (i) has knowledge of any pending or threatened Environmental Claim against Indemnitor or the Property or (ii) has reason to believe that the Indemnitor or the Property is in violation of any Environmental Law or (iii) receives a request for an environmental site assessment report from a regulatory or other governmental entity with jurisdiction over Lender, then at Lender's written request, at any time and from time to time, Indemnitor will provide to Lender an environmental site assessment report concerning the Property, prepared by EMG or an environmental consulting firm approved by Lender, indicating the presence or absence of Hazardous Substances and the potential cost of any removal or remedial action in connection with any Hazardous Substances on the Property. Any such environmental site assessment report shall be conducted at Indemnitor's sole cost and expense. If Indemnitor fails to deliver to Lender any such environmental site assessment report within sixty (60) days afier being requested to do so by Lender pursuant to this Section, Lender may obtain the same, and Indemnitor hereby grants to Lender and its agents access to the Property and specifically grants to Lender an irrevocable nonexclusive license to undertake such an assessment, and the cost of such assessment will be payable by Indemnitor on demand (together with interest thereon at the Default Rate as defined in the Note if such ...