DIVIDEND POLICY AND PROJECTED PAYMENTS

9.1 The Company currently has no contractual obligations that restrict dividend payments.

Dividend Policy
9.2 The dividend policy on the ordinary shares of the Carlton Savannah REIT (Jamaica) Limited is to distribute 95% or greater of its proportionate share of the Investment Property Income generated by the operations of the Carlton Savannah Hotel, net of expenses of the Company, as dividends to its shareholders. This dividend policy may be subject to review from time to time by the Company’s Board.

Projected Dividend Payments
9.3 The Hotel Operating Company shall distribute the Rent from the operation of the Hotel in the following manner:

9.4 The Hotel Operating Company will calculate the amount standing to the credit of the Owners’ Rent Account monthly, with payments being made within thirty (30) days of month’s end. If the payment is not made within the required time period, then the Hotel Operating Company shall pay interest on such sum at the rate of 2% per annum over prime lending rate in Trinidad & Tobago until payment.

9.5 In the first and second year of ownership (that is to say the first year commencing from the Opening, and the year commencing from the anniversary of the Opening) a guaranteed minimum Rent calculated as 8.5% of the original Purchase Price Apartment will be paid monthly, as follows:
9.5.1 In respect of the two year period commencing with the Opening, the Hotel Operating Company will pay a minimum rent equal to the Interim Monthly Rent to the Owner within 30 days of the end of each month.

9.5.2 At the end of each Operating Year the accounts will be audited and the Net Operating Profit will be confirmed and the Additional Rent due to the Owner will be paid in full 30 days after the receipt of the audited accounts.

[Note: Inclusive of the Health Club & Spa, after 15% Trinidad & Tobago tax and the expenses of the REIT, dividend yield is forecasted to be 6.3% per annum in the first two years.]

9.5.3 In respect of the period from and after the second year after the Opening, the Hotel Operating Company shall pay to the Owner monthly in arrears on account of the Additional Rent a sum equal to one-half of the amount which it calculates to be the Additional Rent in respect of the preceding month AND within 30 days after the receipt of the audited accounts for each Operating Year, shall pay to the Owner the balance due in respect of the Additional Rent for such Operating Year.

9.6 All Rent will be paid in Trinidad & Tobago Dollars directly by bank transfer to the owners designated bank account provided to the Hotel Operating Company and all payments made by the Hotel Operating Company to any such account shall be deemed to be payments received by the Owner for the purposes of this Agreement.


9.7 Monthly Rent from the Hotel Operating Company to the Owners’ Rent Account will also consist of monthly Spa Lease Payments for the lease of the Health Club & Spa. Starting in the first year, the Spa Lease Payments is calculated at 6% of the Purchase Price Health Club & Spa. Thereafter, the annual Spa Lease Payments will increase as specified in the Health Club and Spa Underlease. The term of the Health Club & Spa Underlease is twenty years from the Opening and is renewable.

9.8 After the completion of the Offer, the Company has the authority to sell any of its Apartments in accordance with the provisions of the Agreements for Sale (Apartments). The Company also has the authority to issue additional shares to purchase any available Apartments. The costs, including stamp duty, transfer tax or any applicable Government taxes, associated with the purchase by the Company of any such additional Apartments or the sale by the Company of any Apartments shall be incorporated into the sale or purchase prices.

9.9 Should the Company sell an Apartment in accordance with the terms of the applicable Sub-Lease during the course of an Operating Year the Hotel Operating Company will apportion the Rent based on the number of days in the year for which the Company beneficially owned the Apartment between the Company and its successor-in-ownership.

Proceeds from the sale of Apartments owned by the Company may be distributed to its shareholders as dividends.


Defaults and Distributons
9.10 If the Company defaults in the performance of any of its duties responsibilities and obligations of the Hotel Operating Agreement and does not cure the Default within thirty (30) days after receipt of written notification thereof from the Hotel Operating Company, the Hotel Operating Company shall have the right to withhold distribution of that part of the Owner’s Share of Rent due to the Company until such time as the Default is cured. The Hotel Operating Company shall have a right of set-off against the Owner’s Share of Rent for any costs incurred or losses suffered by the Hotel Operating Company. If the Default is such as has the effect of denying the Hotel Operating Company the exclusive use or possession of the Apartment, the Hotel Operating Company shall forfeit the Owner’s Share Rent for the period of the Default.