Bessie T. Giannopulos Executive Director UBS AG, New York Branch HOTEL - CONVERSION TO OWNERSHIP CHECKLIST Below is a list of items and tasks that a lender may wish to consider as part of its preparation to take control of a hotel asset, either through a deed in lieu or foreclosure. Many of the tasks below would fall within the scope of the receiver's or property manager's responsibilities. DESCRIPTION OF I1EMiT ASK RESPONSmLE STATUS COMMENTS PARTY HOTEL FINANCIAL INFORMATION 1. Budget 2. Operating Statements 3. Tenant Delinquency/Aged Receivables Report 4. Property Tax Bills 5. Current Bookings and Rent Roll HOTEL MANAGEMENT 1. Hotel Management Agreement Review notice/consent (new or existing/assignment) requirements, termination rights a. Recognition! Franchise Comfort Letters b. List of outstanding PIP obligations 2. Insurance (Property and Liability) While a lender may be covered for a short period post-transfer under the mortgagee clause of the borrower's existing insurance policy, it is prudent for a new policy to be
3. Insurance (all others, if any) obtained at time of transfer 4. Service Contracts 5. Hotel Employees a. Accrued vacation schedule b. Calculate final payroll c. Remove time cards d. Remove existing payroll files e. Review employment and union contracts, if any f. Employee Withholding Tax Bills g. Copies of Worker of Compensation Claims, guest or employee injury claims or other ongoing claims or disputes h. WARN 6. Lease Agreements 7. Bank Accounts Open new bank accounts/change existing name on bank accounts 8. Credit Card Merchant Numbers Change name on existing credit card merchant numbers; if opening new account change the routing number 9. Phone Lines 10. Equipment Leases/ Copies of Equipment Warranties 11. Garbage Collection 12. Water Treatment 14. Satellite TC - DirecTV
15. Wireless Internet 16. Gas 17. Registration of Hotel Vehicles 18. Sales Tax ill Apply for new ill 19. Inventories Inventory count of all personal property (liquor, food, linens, etc.) and FF&E at the property 20.Review Franchisee Opportunities To the extent property not subject to a brand/franchise, consider suitable franchise for the property 21. Accounts Payable Schedule Cash flow outlining necessary funding 22. Accounts Receivable Schedule Outline responsibility for collection 23. Advance Deposit Schedule Transition deposit money; follow up re future event bookings to confirm no cancellations arising due to transfer of property/customer concerns 24. Guest Ledger. 25. House Banks Count all house banks and either transition or deposit into operating account 26. Bank Reconciliation and Profit and Loss Statements 27. Final Sales Tax Payment Close existing sales tax
number 28. Vendors Notify of change of ownership; review accounts to confirm continued service 29. Workers Compensation Notify of cancellation Insurance 30. Existing Insurance Carrier Notify of cancellation 31. Website and Reservations Review; confirm System 32. Copies of Marketing Plan! Advertising and Marketing Agreements 32. List of Hazardous Materials Uses or Stored, including Storage Tanks, if any 33. O&M Plan-Review Requirements 34. Delivery of Keys 35. Zoning and Entitlement Review and Compliance 36. Litigation Searches- Review claims which survive the transfer website is included in collateral and properly transferred LICENSESIPERMITS 1. Hotel License Review all licenses that need to be transferred to the name of transferee 2. Hotel Occupational License 3. Liquor License 4. Restaurant Occupational License
5. Food Manager Certification 6. Tourist and Convention Development Registration 7. HalllBallroomlBanquet Occupational License 8. Fire Rating Certificates for upholstery, fabrics, walls and floor coverings 9. Property Management Occupational License 10. Swimming Pool Permits 11. Canopy Permits 12. Certificate of Occupancy and Related Structural and Safety Approvals 13. Elevator Inspections 14. Fire Alarm System 15. Loading Zone Permit 16. Retail Tenants Permit 17. Health Club and Spa License 18. KitchenlRestaurant License 19. Fictitious Name Filing - Hotel Name 20. Building Certificate(s) of Use for following uses: a. Hotel b. Restaurants c. Dry Cleaning d. Ticket Sales
21. Public Food Service Establishment License 22. Notice to Guestsrrenants 23. Food Manager Certification 24. Liquor License Surtax Registration and Election 25. Cigarette S ales License 26. Retail Dry Cleaning and Laundry Occupational License 27. Postage Meter 28. City Ticket Broker Occupational License and County Sales Office Occupational License 29. Evacuation Postings 30. Fire Inspection 31. Fire Suppression 32. Fuel Storage 33. Gas Inspection 34. Plumbing 35. RefrigerationJAC 36. Mechanical Equipment and Pressure Tank 37. Smoke Evacuation 38. Stairwell Pressure Test 39. Grease Waste Discharge Permit 40. Health Permit Baths
41. Massage Permit 42. Health Permit Eating and Drinking 43. Permit to Operate and Certificate of Sanitary Inspection for all areas in health club where food is prepared 44. Gift Shop Certificate 45. News Dealers Permit 46. Merchants Retail Permit 47. Permit for Location and Sales of Tobacco Products 48. Retails Sales Registrations 49. Garage Operator Permit 50. Parking Tal> Certificate (to collect) 51. Valet Parking 52. Garbage Removal and Dumpster Permit 53. Vending Machine Permits (beverages and merchandise) 54. ATM Permits 55. Business License 56. Business Tax Receipt