BATON ROUGE – Chevron recently filed a breach of contract suit claiming it is owed nearly $11 million after it exercised its option to sell its shares in the Hilton Capitol Center, a hotel and commercial space
in Baton Rouge.
Chevron filed the lawsuit Aug, 17 in the U.S. District Court for the Middle District of Louisiana against Capitol House Hotel Manager LLC. and the Wilbur Marvin Foundation, claiming the two defendants breached an ongoing contract when they failed to pay out a put price option. The option gives the stock owner the right, but not the obligation, to sell an asset at a specified price by a predetermined date to a given party.
Chevron's filing says, "On Nov. 19, 2015, Chevron exercised its put and sent Capitol House an election notice, which demanded the purchase of Chevron’s interest in the company (the center) by Capitol House for the put price of $10,554,519." Capital House, however, did not pay within the 30 days of that notification.Chevron claims it then sent a letter in November 2016 demanding payment in the amount of $10,958,475 be made by Dec. 30, 2016.
According to Chevron, the nearly $11 million payment has yet to be made, and it is seeking payment plus interest, costs and attorneys’ fees, and for such additional relief as the court deems just and proper.
Chevron invested in and entered into the agreement in 2005, court documents state. That agreement, was amended in 2007 "to correct certain typographical errors in the original purchase agreement." In 2012, the suit claims, "Chevron was granted an option for a six-month period beginning Jan.1, 2012 (the option period)," to elect to sell its membership interest in the venture.