EXHIBIT 10.2

U.S. $108,000,000

AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT

Dated as of January 14, 2005

Among

INTERSTATE OPERATING COMPANY, L.P.

as the Borrower,

SOCIÉTÉ GÉNÉRALE

As the Administrative Agent,

SG AMERICAS SECURITIES, LLC

as Sole Lead Arranger and Book Runner,

and

VARIOUS LENDERS

1

2

3

4

AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT

THIS AMENDED AND RESTATED SENIOR SECURED CREDIT AGREEMENT (this “Agreement”),
dated as of January 14, 2005 (the “Closing Date”), is among INTERSTATE OPERATING
COMPANY, L.P., a Delaware limited partnership, as the Borrower; SOCIÉTÉ
GÉNÉRALE, as the Administrative Agent and the Issuing Bank; SG AMERICAS
SECURITIES, LLC, as Sole Lead Arranger and Book Runner; and the Lenders (as
defined below).

PRELIMINARY STATEMENTS:

WHEREAS, many of the parties hereto previously entered into a Senior Secured
Credit Agreement (the “Existing Credit Agreement”), dated as of July 31, 2002,
by and between the Borrower (fka MeriStar H & R Operating Company, L.P.);
Société Générale, as the Administrative Agent, the Issuing Bank and the
Alternate Currency Swing Line Lender; SG Americas Securities, LLC
(successor-in-interest to SG Cowen Securities Corporation), as Joint Lead
Arranger and Book Runner; Salomon Smith Barney Inc., as Joint Lead Arranger,
Book Runner and Co-Syndication Agent; Lehman Brothers, Inc., as Joint Lead
Arranger, Book Runner and Co-Syndication Agent; Credit Lyonnais New York Branch,
as Documentation Agent; and the banks and other lenders a party thereto;

WHEREAS, pursuant to the Existing Credit Agreement the banks and other lenders
party thereto (the “Existing Lenders”) have made advances to the Borrower, and
have issued or participated in letters of credit (each an “Existing Letter of
Credit”, and collectively the “Existing Letters of Credit”) for the account of
the Borrower, in each case on the terms and conditions set forth therein;

WHEREAS, the Borrower has requested that the Existing Lenders amend the Existing
Credit Agreement and the other Credit Documents (as defined in the Existing
Credit Agreement, and as used herein, the “Existing Credit Documents”) in order
to increase the Commitments under this Agreement and revise certain terms
thereof and the Existing Lenders party hereto have agreed to do so on the terms
and conditions set forth herein; and

WHEREAS, the parties hereto have agreed to amend and restate the Existing Credit
Agreement in its entirety for clarity only, and amend the other Existing Credit
Documents, in order to memorialize such amendments;

WHEREAS, this Amended and Restated Senior Secured Credit Agreement constitutes
for all purposes an amendment to the Existing Credit Agreement and not a new or
substitute agreement or a novation of the Existing Credit Agreement and each
reference to an “Advance” and “Letter of Credit” herein shall mean such Advance
made and each Letter of Credit issued heretofore under the Existing Credit
Agreement;

NOW, THEREFORE, in consideration of the foregoing recitals and the provisions
contained in this Agreement, the parties hereto do hereby agree as follows:

5

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

Section 1.01 Certain Defined Terms. As used in this Agreement, the following
terms shall have the following meanings (unless otherwise indicated, such
meanings to be equally applicable to both the singular and plural forms of the
terms defined):

"Acceptable Lien” means a Lien which (a) exists in favor of the Administrative
Agent for its benefit and the ratable benefit of the Lenders, (b) secures the
Obligations and (c) is perfected and enforceable against all Persons in
preference to any rights of any Person in the property encumbered thereby and
superior to all other Liens except for Permitted Encumbrances; provided that the
Lien on any Ownership Interests in an Unconsolidated Entity may be subordinate
to the Liens securing any Indebtedness of such Unconsolidated Entity.

"Accession Agreement” means an Accession Agreement in the form attached
respectively to the Guaranty, Environmental Indemnity and Security Agreement as
Annex 1 thereto, which agreement causes the Person executing and delivering the
same to the Administrative Agent to become a party, respectively, to the
Guaranty, Environmental Indemnity and Security Agreement.

"Act” has the meaning set forth in Section 10.20.

"Adjusted Base Rate” means, for any day, the fluctuating rate per annum of
interest equal to the greater of (a) the Prime Rate in effect on such day and
(b) the Federal Funds Rate in effect on such day plus one-half of one percent
(.50%).

"Adjusted Base Rate Advance” means an Advance which bears interest as provided
in Section 2.06(a).

"Adjusted EBITDA” means, for any Person or Hospitality Property, as applicable,
for any Rolling Period, the EBITDA of such Person or Hospitality Property, as
applicable, for such Rolling Period; provided that:

(a) the EBITDA from any Unconsolidated Entity or Minority-Owned Fund (but not
the EBITDA from any Permitted Property Agreement with such Person) shall be
excluded from the calculation of Adjusted EBITDA;

(b) if the Parent or any of its Subsidiaries during such Rolling Period or in
the period from the end of such Rolling Period to the Status Reset Date which
occurs in the Fiscal Quarter following such Rolling Period either (i) sells,
disposes of or terminates any Permitted Property Agreements or (ii) sells or
disposes of any Investments or Non-Replaced Property with an Investment Amount
in excess of $1,000,000, the EBITDA arising from such Permitted Property
Agreement, Investment, or Non-Replaced Property, as applicable, for the
applicable Rolling Period shall be excluded from the calculation of Adjusted
EBITDA, provided, however, that with respect to any termination payments
received in connection with the termination of a Permitted Property Agreement
with MHC or its Subsidiary, the Parent shall include within the calculation of
Adjusted EBITDA for the applicable Rolling Periods in which termination payments
were received (A) 80% of the termination payments received in the first year
following the termination of such Permitted Property Agreement, (B) 60% of the
termination payments received in the second year following the termination of
such Permitted Property Agreement, (C) 40% of the termination payments received
in the third year following the termination of such Permitted Property Agreement
and (D) 20% of the termination payments received in the fourth year following
the termination of such Permitted Property Agreement;

(c) if the Parent or any of its Subsidiaries during such Rolling Period or in
the period from the end of such Rolling Period to the Status Reset Date which
occurs in the Fiscal Quarter following such Rolling Period either (i) purchases
or acquires any Permitted Property Agreements or (ii) purchases or acquires any
Investments with an Investment Amount in excess of $1,000,000, the EBITDA
arising from such Permitted Property Agreement or Investment, as applicable, for
the applicable Rolling Period on a pro forma basis shall be included in the
calculation of Adjusted EBITDA; and

(d) the non-cash employee compensation up to $2,000,000 per Fiscal Year in the
aggregate commencing with the 2004 Fiscal Year, and other non-cash items of such
Person or Hospitality Property, as applicable, for such Rolling Period shall be
excluded from the calculation of Adjusted EBITDA.

"Adjusted Net Worth” means, for the Parent as of any date, the sum of (a) the
Parent’s Net Worth on such date plus (b) the minority interest reflected as a
liability on the Parent’s balance sheet on such date determined in accordance
with GAAP (excluding that portion of the minority interest attributable to
Ownership Interests in any Subsidiary of the Borrower which is not a Guarantor).

"Adjustment Event” has the meaning set forth in Section 2.14(a).

"Adjustment Report” means a certificate of the Borrower in substantially the
form of the attached Exhibit B.

"Administrative Agent” means Société Générale in its capacity as Administrative
Agent for the Lenders pursuant to Article IX and any successor Administrative
Agent appointed pursuant to Section 9.06.

"Advance” means a Revolving Advance or a Term Advance.

"Affected Lender” has the meaning set forth in Section 2.15(a).

"Affiliate” means, as to any Person, any other Person that, directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such Person or any Subsidiary of such Person. The
term “control” (including the terms “controlled by” or “under common control
with”) means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a Person, whether through
ownership of a Control Percentage, by contract or otherwise.

"Agreement” has the meaning given such term in the initial paragraph of this
agreement.

"Applicable Lending Office” means, with respect to each Lender, (a) in the case
of an Adjusted Base Rate Advance, such Lender’s Domestic Lending Office, (b) in
the case of all Eurodollar Rate Advances, such Lender’s Eurodollar Lending
Office, and (c) in the case of any other notice or request under the Credit
Documents, the office of such Lender specified as its “Credit Contact” in the
questionnaire such Lender provided to the Administrative Agent, or such other
office of such Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.

"Applicable Margin” means, (a) with respect to any Advance at any date, the
applicable percentage per annum set forth below based upon the Status then in
effect under the column for such Class and Type of Advance, and (b) with respect
to the letter of credit fee payable under Section 2.03(b) at any date, the
applicable percentage per annum set forth below based upon the Status then in
effect under the column for Revolving Advances which are Eurodollar Rate
Advances.

                                         
 
  Revolving Advances                   Term Advances

 
          Adjusted Base Rate
  Eurodollar Rate
  Adjusted Base Rate
  Eurodollar Rate

 
          Advances
  Advances   Advances
  Advances

Level I Status
            1.25 %     3.25 %     2.50 %     4.50 %
Level II Status
            1.50 %     3.50 %     2.50 %     4.50 %
Level III Status
            1.50 %     3.50 %     3.50 %     5.50 %

"Appraisal” means an appraisal prepared by an M.A.I. appraiser approved by the
Administrative Agent which appraisal is acceptable to the Administrative Agent
and done in conformity with the following standards: Uniform Standards of
Professional Appraisal Practice, the requirements of the Code of Professional
Ethics and the Standards of Professional Appraisal Practice of the Appraisal
Institute, the appraisal guidelines set forth by the office of the Comptroller
of the Currency and the Federal Reserve Board.

"Approved Fund” means any fund that invests in commercial loans in the ordinary
course which is advised or managed by an investment advisor, an Affiliate of an
investment advisor, a Lender or an Affiliate of a Lender.

"Approved Inter-Company Indebtedness” means (a) the Indebtedness described on
Schedule 1.01(a), which Indebtedness (i) may not exceed $50,000,000 without the
approval of the Administrative Agent, (ii) is unsecured, (iii) is subordinated
to the Obligations in a manner acceptable to the Administrative Agent, and
(iv) is Collateral and (b) any future Indebtedness of the Borrower to the Parent
created with the proceeds of a Parent Capitalization Event which satisfies the
requirements of the foregoing clauses (ii), (iii) and (iv).

"Approved Inter-Company Indebtedness Loan Documents” means the documents
described on Schedule 1.01(a), together with any additional promissory notes or
other documents evidencing Approved Inter-Company Indebtedness.

"Asset Disposition” means any conveyance, exchange, transfer, assignment, or
condemnation of any Investment or Non-Replaced Property by the Borrower or a
Guarantor to a Person other than the Borrower or a Guarantor.

"Assignment and Acceptance” means an assignment and acceptance entered into by a
Lender and an Eligible Assignee, and accepted by the Administrative Agent, in
substantially the form of the attached Exhibit C.

"Assignment of Leases” means an assignment of leases, rents and security
deposits executed by the Borrower or any Guarantor to secure the Obligations,
each in form reasonably approved by the Administrative Agent with such
modifications as may be necessary and appropriate in the opinion of counsel to
the Administrative Agent to comply with the state law of the filing jurisdiction
and as may be reasonably satisfactory to the Administrative Agent, as the same
may be amended or terminated in accordance with its terms.

"Beverage Entity” means any Subsidiary or Unconsolidated Entity of the Parent
for which substantially all of such Person’s Property is directly related to the
sale of beverages at a Hospitality Property, and “Beverage Entities” means all
such Persons.

"Borrower” means Interstate Operating Company, L.P., a Delaware limited
partnership.

"Borrowing” means a borrowing consisting of simultaneous Advances of the same
Type (a) made by each Lender pursuant to Section 2.01(a) or 2.01(b) or
(b) Converted by each Lender to Advances of a different Type pursuant to
Section 2.02(b).

"Business Day” means (a) with respect to Adjusted Base Rate Advances, a day of
the year on which banks are not required or authorized to close in New York, New
York, and (b) with respect to Eurodollar Rate Advances, a day of the year on
which banks are not required or authorized to close in New York, New York, or
London, England.

"Capital Expenditure” means any payment made directly or indirectly for the
purpose of acquiring or constructing fixed assets, real property, improvements,
equipment, or other personal property, or for replacements or substitutions
therefore or additions thereto, which in accordance with GAAP would be
capitalized in the fixed asset accounts of such Person making such expenditure,
including, without limitation, amounts paid or payable for such purpose under
any conditional sale or other title retention agreement or under any Capital
Lease, but excluding repairs or maintenance of any Hospitality Property in the
normal and ordinary course of business in keeping with the past practices of the
Borrower or the Parent.

"Capital Lease” means, for any Person, any lease of any Property (whether real,
personal or mixed) by that Person as lessee which, in accordance with GAAP, is
or should be accounted for as a capital lease on the balance sheet of that
Person.

"Capitalization Event” means any sale or issuance by the Parent or any of its
Subsidiaries of equity securities except for the issuance of the Borrower’s
limited partnership interests in accordance with the provisions of Section 6.05.

"Capitalized Lease Obligations” means, as to any Person, the capitalized amount
of all obligations of such Person or any of its Subsidiaries under Capitalized
Leases, as determined on a consolidated basis in conformity with GAAP.

"Cash Collateral Account” means a special cash collateral account containing
cash deposited pursuant to the terms of this Agreement to be maintained at the
Administrative Agent’s office in accordance with Section 8.04.

"CERCLA” means the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended, all rules and regulations and requirements
thereunder in each case as now or hereafter in effect.

"Change in Control” means for any Person a change in ownership or control of
such Person effected through either of the following transactions:

(a) any Person or related group of Persons (other than such Person or an
Affiliate of such Person) directly or indirectly acquires beneficial ownership
(within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as
amended) of (i) securities possessing more than fifty percent (50%) of the total
combined voting power of such Person’s outstanding securities, or (ii) with
respect to the Parent or the Borrower, securities (excluding securities held by
transferees of CGLH Partners I LP and CGLH Partners II LP as of the Closing
Date) possessing more than thirty five percent (35%) of the total combined
voting power of such Person’s outstanding securities; or

(b) there is a change in the composition of such Person’s Board of Directors
over a period of thirty-six (36) consecutive months (or less) such that a
majority of Board members (rounded up to the nearest whole number) ceases, by
reason of one or more proxy contests for the election of Board members, to be
comprised of individuals who either (i) have been Board members continuously
since the beginning of such period or (ii) have been elected or nominated for
election as Board members during such period by at least a majority of the Board
members described in clause (i) who were still in office at the time such
election or nomination was approved by the Board.

"Class” has the meaning set forth in Section 1.04.

"Closing Date” has the meaning given such term in the initial paragraph of this
agreement.

"Code” means the Internal Revenue Code of 1986, as amended, and any successor
statute.

"Collateral” means all of the Parent’s and its Subsidiaries’ interests in the
following, whether owned on or acquired after the Closing Date: (a) the
Ownership Interests of all existing Subsidiaries and Unconsolidated Entities of
the Parent and the Borrower and any future Material Subsidiary or Material
Unconsolidated Entity except for the Ownership Interests in Beverage Entities
(the Ownership Interests required to be Collateral pursuant to this definition
being referred to herein as the “Ownership Interests Collateral”), (b) the
rights to receive payments for its account (including the right to receive
termination payments) under all Permitted Property Agreements, (c) Owned
Hospitality Properties, (d) the Approved Inter-Company Indebtedness and the
Approved Inter-Company Indebtedness Loan Documents, (e) any other collateral
described in the Security Agreement or other Security Documents; provided that
the pledge of such Property is not prohibited by the terms of (i) Permitted
Property Agreements, joint venture agreements, organizational documents and
other contractual arrangements to which the Borrower or a Subsidiary is a party
and which are in effect on the Closing Date, in each case as approved by the
Administrative Agent; (ii) with respect to any Ownership Interests in or
Property of a Permitted Other Subsidiary, the loan documentation for any
Permitted Other Indebtedness incurred by such Permitted Other Subsidiary; and
(iii) with respect to any Ownership Interests in an Unconsolidated Entity, the
loan documentation for Indebtedness incurred by such Unconsolidated Entity or
joint venture agreements or other contractual arrangements for such
Unconsolidated Entity. The Ownership Interests which cannot be pledged as of the
date of this Agreement are those certain Ownership Interests designated in
Schedule 1.01(b) as Non-Pledgable.

"Commitment” means, as to any Lender, its Revolving Commitment and its Term
Commitment.

"Commitment Fee Rate” means, with respect to the commitment fee payable under
Section 2.03(a) at any date, .50% percent per annum.

"Compliance Certificate” means a certificate of the Borrower in substantially
the form of the attached Exhibit D.

"Consolidated” refers, with respect to any Person, to the consolidation of the
accounts of such Person with such Person’s Subsidiaries in accordance with GAAP.

"Control Percentage” means, with respect to any Person, the percentage of the
outstanding capital stock of such Person having ordinary voting power which
gives the direct or indirect holder of such stock the power to elect a majority
of the Board of Directors of such Person.

"Controlled Group” means all members of the controlled group of corporations and
all trades (whether or not incorporated) under common control which, together
with the Borrower, are treated as a single employer under Section 414 of the
Code.

"Convert”, “Conversion”, and “Converted” each refers to a conversion of Advances
of one Type into Advances of another Type pursuant to Section 2.02(b).

"Credit Documents” means this Agreement, the Notes, the Guaranties, the
Environmental Indemnities, the Security Documents, the Fee Letter, and each
other agreement, instrument or document executed by the Borrower or any of its
Subsidiaries at any time in connection with this Agreement.

"Currency Agreements” means all swaps, caps or collar agreements or similar
arrangements providing for protection against fluctuations in currency exchange
rates, either generally or under specific contingencies.

"Customary Management Agreement” means a management agreement for a Hospitality
Property by and between a Person, as owner, and Borrower or Borrower’s
Subsidiary or Unconsolidated Entity, as manager, which (a) has a term and early
termination payment provisions which are reasonable based upon the amount of any
Investment made to obtain such management agreement and (b) is in substantially
the form of an Existing Management Agreement, a form which does not include
materially adverse provisions which are not customary for management agreements
of Hospitality Properties or such other form as is approved by the
Administrative Agent in writing (which approval shall not be unreasonably
withheld).

"Customary Participating Lease” means a lease (except for a Ground Lease) for a
Hospitality Property by and between a Person, as lessor, and Borrower or
Borrower’s Subsidiary, as lessee, which (a) has expected economics and a term
and early termination payment provisions which are reasonable based upon the
amount of any Investment made to obtain such lease and (b) are in a form which
does not include materially adverse provisions which are not customary for
participating leases of Hospitality Properties or such other form as is approved
by the Administrative Agent in writing (which approval shall not be unreasonably
withheld).

"Customary Property Agreement” means a Customary Management Agreement or a
Customary Participating Lease, and “Customary Property Agreements” means all
such agreements and leases.

"Dallas Pledgors” means Interstate/Dallas GP, LLC and Interstate/Dallas
Partnership, LP.

"Default” means (a) an Event of Default or (b) any event or condition which with
notice or lapse of time or both would, unless cured or waived, become an Event
of Default.

"Defaulting Lender” means any Lender which has wrongfully refused or failed to
make available its portion of any Borrowing or to fund its portion of any
unreimbursed payment under Section 9.05, or notified in writing the Borrower or
the Administrative Agent that such Lender does not intend to comply with its
obligations under this Agreement.

"Dollar Equivalent” means the equivalent in another currency of an amount in
Dollars to be determined by reference to the rate of exchange quoted by Société
Générale at 10:00 a.m. (New York City time) on the date of determination, for
the spot purchase in the foreign exchange market of such amount of Dollars with
such other currency.

"Dollars” and “$” means lawful money of the United States of America.

"Domestic Lending Office” means, with respect to any Lender, the office of such
Lender specified as its “Operations Contact” for Adjusted Base Rate Advances in
the questionnaire such Lender provided to the Administrative Agent, or such
other office of such Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.

"EBITDA” means for any Person or Hospitality Property, as applicable, for any
period for which such amount is being determined, an amount equal to (a) the Net
Income for such Person or Hospitality Property, as applicable, for such period
plus (b) to the extent deducted in determining Net Income, Interest Expense,
income taxes, depreciation, and amortization, as determined on a Consolidated
basis in accordance with GAAP plus (c) to the extent deducted in determining Net
Income, deductions for minority interest attributable to the Ownership Interests
in the Borrower not owned (directly or indirectly) by the Parent.

"Effective Date” means the date all of the conditions precedent set forth in
Section 3.01 have been satisfied.

"Eligible Assignee” means any of the following approved by those Persons who
have approval rights pursuant to the provisions of Section 10.06, which approval
will not be unreasonably withheld: (a) a commercial bank organized under the
laws of the United States, or any State thereof, and having primary capital of
not less than $250,000,000 (b) a commercial bank organized under the laws of any
other country which is a member of the Organization for Economic Cooperation and
Development and having primary capital (or its equivalent) of not less than
$250,000,000 (or its Dollar Equivalent), (c) an investment bank organized under
the laws of the United States, or any State thereof, and having total assets in
excess of $5,000,000,000, (d) an insurance company, finance company or financial
institution (whether a corporation, partnership, trust or other Person)
organized under the laws of the United States, or any state thereof, and having
total assets in excess of $5,000,000,000, (e) with respect to Term Advances
only, any Approved Fund or Related Fund, (f) with respect to Term Advances only,
any “accredited investor” (as defined in Regulation D of the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder) which
has total assets in excess of $100,000,000, (g) a Lender, (h) an Affiliate of
the respective assigning Lender meeting the eligibility requirements of (a),
(b), (c), (d), (e) or (f) above, and (i) any other Person approved by the
Administrative Agent and the Borrower, and if such Person will hold a Revolving
Commitment, the Issuing Bank.

"Engineering Report” means with respect to any Owned Hospitality Property, an
engineering report which (a) is prepared for the Lenders and the Administrative
Agent by a Person reasonably satisfactory to the Administrative Agent, (b) is
prepared in accordance with a scope of services reasonably satisfactory to the
Administrative Agent, (c) is prepared within three (3) months of the date of
acquisition of such Owned Hospitality Property, and (d) reflects no material
concerns pertaining to the physical condition of the Owned Hospitality Property,
including without limitation the structural, electrical, plumbing, mechanical
and other essential components of the Owned Hospitality Property.

"Environment” or “Environmental” shall have the respective meanings set forth in
42 U.S.C. ' 9601(8), as amended.

"Environmental Claim” means any third party (including governmental agencies and
employees) action, lawsuit, claim, demand, regulatory action or proceeding,
order, decree, consent agreement or notice of potential or actual responsibility
or violation (including claims or proceedings under the Occupational Safety and
Health Acts or similar laws or requirements relating to health or safety of
employees) which seeks to impose liability under any Environmental Law.

"Environmental Indemnity” means one or more environmental indemnity agreements
dated of even date herewith in substantially the form of the attached Exhibit E
executed or to be executed by the Borrower, the Parent and all Guarantors, and
any future environmental indemnities executed in connection with any Hospitality
Property, as any of such environmental indemnities may be amended hereafter in
accordance with the terms of such agreements.

"Environmental Law” means all Legal Requirements arising from, relating to, or
in connection with the Environment, health, or safety, including without
limitation CERCLA, relating to (a) pollution, contamination, injury,
destruction, loss, protection, cleanup, reclamation or restoration of the air,
surface water, groundwater, land surface or subsurface strata, or other natural
resources; (b) solid, gaseous or liquid waste generation, treatment, processing,
recycling, reclamation, cleanup, storage, disposal or transportation;
(c) exposure to pollutants, contaminants, hazardous, medical, infectious, or
toxic substances, materials or wastes; (d) the safety or health of employees; or
(e) the manufacture, processing, handling, transportation, distribution in
commerce, use, storage or disposal of hazardous, medical, infectious, or toxic
substances, materials or wastes.

"Environmental Permit” means any permit, license, order, approval or other
authorization under Environmental Law.

"Environmental Report” means with respect to any Owned Hospitality Property, an
environmental report which (a) is prepared for the Lenders and the
Administrative Agent by a Person reasonably satisfactory to the Administrative
Agent, (b) is prepared in accordance with a scope of services reasonably
satisfactory to the Administrative Agent, (c) is prepared within three (3)
months of the date of acquisition of such Owned Hospitality Property, and
(d) certifies to the Administrative Agent and the Lenders that the Owned
Hospitality Property and the soil and the groundwater thereunder do not contain
Hazardous Substances except for Permitted Hazardous Substances.

"ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

"Eurodollar Lending Office” means, with respect to any Lender, the office or
offices of such Lender specified as its “Operations Contact” for each type of
Eurodollar Rate Advance in the questionnaire such Lender provided to the
Administrative Agent, or such other office of such Lender as such Lender may
from time to time specify to the Borrower and the Administrative Agent for each
type of Eurodollar Rate Advance.

"Eurodollar Rate” means, for the Interest Period for each Eurodollar Rate
Advance comprising part of the same Borrowing, an interest rate per annum
(rounded upward to the nearest whole multiple of 1/16 of 1% per annum) equal to
(a) the rate per annum at which deposits in Dollars are offered to prime banks
in the London interbank market at 11:00 a.m. (London time) two Business Days
before the first day of such Interest Period as shown on the display designated
“British Banker’s Association Interest Settlement Rates” on Telerate at Page
3750 or Page 3740, or such other page or pages as may replace such pages on
Telerate for purposes of displaying such rate, in an amount substantially equal
to Société Générale’s Eurodollar Rate Advance comprising part of such Borrowing
and for a period equal to such Interest Period divided by (b) one minus the
Eurodollar Reserve Requirement. However, if the aforementioned Telerate offered
rate is not available, then such offered rate shall be otherwise independently
determined by Administrative Agent from an alternate, substantially similar
source available to Administrative Agent or shall be calculated by
Administrative Agent by a substantially similar methodology as that theretofore
used to determine such offered rate in Telerate.

"Eurodollar Rate Advance” means an Advance which bears interest as provided in
Section 2.06(b).

"Eurodollar Reserve Requirement” shall mean, on any day, that percentage
(expressed as a decimal fraction) which is in effect on such date, as provided
by the Federal Reserve System for determining the maximum reserve requirements
generally applicable to financial institutions regulated by the Federal Reserve
Board comparable in size and type to the Administrative Agent (including,
without limitation, basic, supplemental, marginal and emergency reserves) under
Regulation D with respect to “Eurocurrency liabilities” as currently defined as
Regulation D, or under any similar or successor regulation with respect to
Eurocurrency liabilities or Eurocurrency funding (or other category of
liabilities which includes deposits by reference to which the interest rate on a
LIBOR Advance is determined or any category or extensions of credit which
includes loans by a non-United States office of the Administrative Agent to
United States residents). Each determination by the Administrative Agent of the
Eurodollar Reserve Requirement, shall, in the absence of manifest error, be
conclusive and binding upon the Borrower.

"Event of Default” has the meaning set forth in Section 8.01.

"Exchange Act” means the Securities Exchange Act of 1934,15 U.S.C., as amended,
and the rules and regulations promulgated thereunder.

"Existing Credit Agreement” has the meaning set forth in the preliminary
statements to this Agreement.

"Existing Credit Documents” has the meaning set forth in the preliminary
statements to this Agreement.

"Existing Lenders” has the meaning set forth in the preliminary statements to
this Agreement.

"Existing Letter of Credit” and “Existing Letters of Credit” have the respective
meanings set forth in the preliminary statements to this Agreement.

"Existing Management Agreements” means the management agreements listed on
Schedule 1.01(c).

"Existing Notes” means the promissory notes payable under the Existing Credit
Agreement.

"Existing Owned Hospitality Property Investments” means the Owned Hospitality
Property Investments set forth on Schedule 1.01(d) and other Owned Hospitality
Property Investments in which the Borrower’s direct or indirect ownership in
such Owned Hospitality Property Investment is equal to or less than twenty
percent (20%) of the total ownership in such Owned Hospitality Property
Investment.

"Expiration Date” means, with respect to any Letter of Credit, the date on which
such Letter of Credit will expire or terminate in accordance with its terms.

"Federal Funds Rate” means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for any such day on such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.

"Federal Reserve Board” means the Board of Governors of the Federal Reserve
System or any of its successors.

"Fee Letter” means the letter agreement dated as of July 16, 2004, among the
Borrower, the Parent, SG Americas and Société Générale, as amended.

"FelCor” means FelCor Lodging Limited Partnership.

"Financial Statements” means the financial statements of the Parent and its
Subsidiaries dated as of September 30, 2004.

"Financing Statement” means any Uniform Commercial Code — Financing Statement —
Form UCC-1 to be executed (if necessary or desirable) and delivered by the
Parent or any of its Subsidiaries in connection with perfecting the security
interest assigned by any Security Document, and any extension, renewal, or
amendment thereof.

"Fiscal Quarter” means each of the three-month periods ending on March 31,
June 30, September 30 and December 31.

"Fiscal Year” means the twelve-month period ending on December 31.

"Fund” means the Hazardous Substance Response Trust Fund, established pursuant
to 42 U.S.C. ' 9631 (1988) and the Post-closure Liability Trust Fund,
established pursuant to 42 U.S.C. ' 9641 (1988), which statutory provisions have
been amended or repealed by the Superfund Amendments and Reauthorization Act of
1986, and the “Fund,” “Trust Fund,” or “Superfund” that are now maintained
pursuant to 42 U.S.C. ' 9507.

"GAAP” means United States generally accepted accounting principles as in effect
from time to time, applied on a basis consistent with the requirements of
Section 1.03.

"Governmental Authority” means any foreign governmental authority, the United
States of America, any state of the United States of America and any subdivision
of any of the foregoing, and any agency, department, commission, board,
authority or instrumentality, bureau or court having jurisdiction over any
Lender, the Parent, the Borrower, any Subsidiaries of the Borrower or the Parent
or any of their respective Properties.

"Ground Lease” means a lease by and between a Person, as lessor, and Borrower or
Borrower’s Subsidiary, as lessee, where the term of such lease is in excess of
twenty (20) years.

"Guarantor” means each of the Parent, each Subsidiary of the Parent (except the
(a) Permitted Other Subsidiaries, (b) the Beverage Entities, (c) certain other
non-Material Subsidiaries which are prohibited from acting as a Guarantor
because of joint venture agreements, organizational documents and other
contractual arrangements to which such non-Material Subsidiary is a party and
which are in effect on the Closing Date, in each case as approved by the
Administrative Agent and (d) Subsidiaries with assets and revenues less than
$100,000) existing as of the Closing Date, and any future Material Subsidiary,
and “Guarantors” means all of such Persons. The Guarantors on the Closing Date
are identified on Schedule 1.01(e).

"Guaranty” means one or more Amended and Restated Guaranty and Contribution
Agreements in substantially the form of the attached Exhibit F executed by the
Guarantors, evidencing the joint and several guaranty by the signatories thereto
of the obligations of Borrower in respect of the Credit Documents, and any
future guaranty and contribution agreement executed to secure Advances, as any
of such agreements may be amended hereafter in accordance with the terms of such
agreements.

"Hazardous Substance” or “Hazardous Material” means the substances identified as
such pursuant to CERCLA and those regulated under any other Environmental Law,
including without limitation pollutants, contaminants, petroleum, petroleum
products, radio nuclides, radioactive materials, and medical and infectious
waste.

"Hazardous Waste” means the substances regulated as such pursuant to any
Environmental Law.

"Hospitality Management Business” shall mean the management, operation or
leasing as lessee of any Hospitality Property, including timeshare sales and
brokerage, and the operation of any Permitted Housing Business.

"Hospitality Property” shall mean a full service or limited service hotel or
resort, a condominium or timeshare resort, an extended stay property, or a
conference center, and other facilities incidental to, or in support of such
property, including without limitation, restaurants and other food-service
facilities, golf facilities or other entertainment facilities or club,
conference or meeting facilities and Intellectual Property related thereto;
provided that such property shall not include any casino or other gaming
property (even if only a part of a Hospitality Property) or senior living
property.

"Improvements” for any Owned Hospitality Property means all buildings,
structures, fixtures, tenant improvements and other improvements of every kind
and description now or hereafter located in or on or attached to the Land for
such Owned Hospitality Property; and all additions and betterments thereto and
all renewals, substitutions and replacements thereof.

"Indebtedness” means (without duplication), at any time and with respect to any
Person, (a) indebtedness of such Person for borrowed money (whether by loan or
the issuance and sale of debt securities) or for the deferred purchase price of
property or services purchased (other than amounts constituting trade payables
or bank drafts arising in the ordinary course of business); (b) indebtedness of
others in the amount which such Person has directly or indirectly assumed or
guaranteed or otherwise provided credit support therefore or for which such
Person is liable as a partner of such Person; (c) indebtedness of others in the
amount secured by a Lien on assets of such Person, whether or not such Person
shall have assumed such indebtedness unless the validity of such Lien is being
contested in good faith and with due diligence by appropriate proceedings,
provided that such Lien is subordinate to the Liens created by the Security
Documents and such Person shall have delivered a bond or other security
acceptable to the Administrative Agent equal to 125% of the contested amount;
(d) obligations of such Person in respect of letters of credit, acceptance
facilities, or drafts or similar instruments issued or accepted by banks and
other financial institutions for the account of such Person (other than trade
payables or bank drafts arising in the ordinary course); (e) Capitalized Lease
Obligations of such Person; (f) all obligations, contingent or otherwise, of
such Person under any synthetic lease, tax retention operating lease, off
balance sheet loan or similar off balance sheet financing arrangement if the
transaction giving rise to such obligation (1) is considered indebtedness for
borrowed money for U.S. federal income tax purposes but is classified as an
operating lease under GAAP and (2) does not (and is not required pursuant to
GAAP to) appear as a liability on the balance sheet of such Person; (g) all
obligations of such Person to purchase, redeem, retire, defease or otherwise
make any payment in respect of any Mandatorily Redeemable Stock issued by such
Person or any other Person, valued at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; (h) all
obligations of such Person in respect of any take-out commitment or forward
equity commitment (excluding, in the case of the Borrower and its Subsidiaries,
any such obligation that can be satisfied solely by the issuance of Ownership
Interests (other than Mandatorily Redeemable Stock)); and (i) to the extent
treated as a liability under GAAP, obligations under interest rate swap
agreements, interest rate cap agreements, interest rate collar agreements or
other similar agreements or arrangements designed to protect against
fluctuations in interest rates.

"Insurance Annual Statement” means the annual statutory financial statements of
each Insurance Company required to be filed with the insurance commissioner (or
similar Governmental Authority) of its jurisdiction of incorporation, which
statement shall be in the form required by the jurisdiction of incorporation of
such Insurance Company or, if no specific form is so required, in the form of
financial statements permitted by such insurance commissioner (or such similar
Governmental Authority) to be used for filing annual statutory financial
statements and shall contain the type of information permitted by such insurance
commissioner (or such similar Governmental Authority) to be disclosed therein,
together with all exhibits or schedules filed therewith.

"Insurance Contract” means each outstanding insurance contract of each Insurance
Company.

"Insurance Company” means each of the Borrower, the Parent or their respective
Subsidiaries that is or acts as an insurance company or provides a guaranty for
a Person acting as an insurance company.

"Insurance License” means any license, certificate of authority, permit or other
authorization which is required to be obtained from any Governmental Authority
in connection with the operation, ownership or transaction of insurance
business.

"Insurance Reserve Liabilities” means all reserves and other liabilities with
respect to insurance and for claims and benefits incurred but not reported.

"Insurance Surplus” means an estimate of the amount by which an insurance plan’s
assets exceed its expected current and future liabilities, including the amount
expected to be needed to fund future benefit payments.

"Intellectual Property” shall have the meaning given such term in the Security
Agreement.

"Interest Coverage Ratio” means, as of the end of any Rolling Period, a ratio of
(a) the Parent’s Adjusted EBITDA to (b) the Parent’s Interest Expense, for such
Rolling Period.

"Interest Expense” means, for any Person for any period for which such amount is
being determined, the total interest expense (including that properly
attributable to Capital Leases in accordance with GAAP) and all charges incurred
with respect to letters of credit determined on a Consolidated basis in
conformity with GAAP, plus capitalized interest of such Person and its
Subsidiaries.

"Interest Period” means, for each Eurodollar Rate Advance comprising part of the
same Borrowing, the period commencing on the date of such Advance or the date of
the Conversion of any Adjusted Base Rate Advance into such an Advance and ending
on the last day of the period selected by the Borrower pursuant to the
provisions below and Section 2.02 and, thereafter, each subsequent period
commencing on the last day of the immediately preceding Interest Period and
ending on the last day of the period selected by the Borrower pursuant to the
provisions below and Section 2.02. To the extent available for a Eurodollar Rate
Advance, the duration of each such Interest Period shall be one, two, three or
six months for all other Eurodollar Rate Advances, in each case as the Borrower
may select, upon notice received by the Administrative Agent not later than
12:00 noon (New York, New York time) on the third Business Day prior to the
first day of such Interest Period, provided, however, that:

(a) Interest Periods for Advances of the same Borrowing shall be of the same
duration;

(b) whenever the last day of any Interest Period would otherwise occur on a day
other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day, provided that if such
extension would cause the last day of such Interest Period to occur in the next
following calendar month, the last day of such Interest Period shall occur on
the preceding Business Day;

(c) any Interest Period which begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of the calendar month in which it would have ended if there were a
numerically corresponding day in such calendar month;

(d) each successive Interest Period shall commence on the day on which the next
preceding Interest Period expires; and

(e) no Interest Period with respect to any portion of any Advance shall extend
beyond the Maturity Date.

"Interest Rate Agreements” means any interest rate swap agreement, interest rate
cap agreement, interest rate collar agreement or other similar agreement or
arrangement pertaining to the fluctuations in interest rates.

"Investment” means, with respect to any Person, (a) any loan or advance to any
other Person, (b) the ownership, purchase or other acquisition of any Ownership
Interests or Ownership Interest Equivalents in any other Person, (c) any joint
venture or partnership with, or any capital contribution to, or other investment
in, any other Person, including by way of merger, (d) any Capital Expenditure,
and (e) any payment, whether capitalized or not, to acquire a management
agreement or lease (including, without limitation, any Permitted Property
Agreement or Permitted Housing Agreement).

"Investment Amount” means (a) for any Owned Hospitality Property the sum of
(i) the aggregate purchase price paid by the Borrower or its Subsidiary for such
Owned Hospitality Property, and (ii) the actual cost of any Capital Expenditures
for such Owned Hospitality Property made by the Borrower or its Subsidiaries
after the acquisition of such Owned Hospitality Property, and (b) for any other
Investment or Property the aggregate purchase price paid by the Borrower or its
Subsidiary for such other Investment or Property. The Investment Amount shall
include any Ownership Interests or Ownership Interest Equivalents used to
purchase such Investment at their fair market value at the time of purchase;
provided that any such Ownership Interests or Ownership Interest Equivalents
which are convertible into the Parent’s common stock shall be valued at the
price at which they could be exchanged into the Parent’s common stock assuming
such exchange occurred on the date of acquiring such Investment. Investment
Amount shall not include Indebtedness incurred in connection with an Investment,
or any refinancing of such Indebtedness, unless such Indebtedness was provided
by the Parent, the Borrower or one of their respective Subsidiaries.

"Issuing Bank” means Société Générale or any Lender acting as a successor
Issuing Bank pursuant to Section 9.06, and “Issuing Banks” means, collectively,
all of such Lenders.

"Land” for any Owned Hospitality Property means the real property upon which the
Owned Hospitality Property is located, together with all rights, title and
interests appurtenant to such real property, including without limitation all
rights, title and interests to (a) all strips and gores within or adjoining such
property, (b) the streets, roads, sidewalks, alleys, and ways adjacent thereto,
(c) all of the tenements, hereditaments, easements, reciprocal easement
agreements, rights-of-way and other rights, privileges and appurtenances
thereunto belonging or in any way pertaining thereto, (d) all reversions and
remainders, (e) all air space rights, and all water, sewer and wastewater
rights, (e) all mineral, oil, gas, hydrocarbon substances and other rights to
produce or share in the production of anything related to such property, and
(f) all other appurtenances appurtenant to such property, including without
limitation, any now or hereafter belonging or in anywise appertaining thereto.

"Legal Requirement” means any law, statute, ordinance, decree, requirement,
order, judgment, rule, regulation (or official interpretation of any of the
foregoing) of, and the terms of any license or permit issued by, any
Governmental Authority.

"Lehman” means Lehman Commercial Paper Inc.

"Lehman Indebtedness” means the Subordinate Indebtedness owed by the Borrower
and the Borrower’s Subsidiaries to Lehman and other lenders of approximately
$40,000,000, as evidenced by that certain Subordinate Unsecured Term Loan
Agreement dated as of January 10, 2003, between the Borrower, Lehman, as
administrative agent and lender, and certain other financial institutions party
thereto, as amended.

"Lenders” means the lenders who have a Revolving Commitment or a Term Commitment
as of the Effective Date and each Eligible Assignee that shall become a party to
this Agreement pursuant to Section 10.06, and “Lender” means any such Person.

"Letter of Credit” means, individually, any letter of credit issued by the
Issuing Bank in accordance with the provisions of Section 2.13 of this
Agreement, including any Existing Letter of Credit, and “Letters of Credit”
means all such letters of credit collectively.

"Letter of Credit Documents” means, with respect to any Letter of Credit, such
Letter of Credit and any reimbursement or other agreements, documents, and
instruments entered into in connection with or relating to such Letter of
Credit.

"Letter of Credit Exposure” means, at any time, the sum of (a) the aggregate
undrawn maximum face amount of each Letter of Credit and (b) the aggregate
unpaid amount of all Letter of Credit Obligations at such time.

"Letter of Credit Obligations” means all obligations of the Borrower arising in
respect of the Letter of Credit Documents, including without limitation the
aggregate drawn amounts of Letters of Credit which have not been reimbursed by
the Borrower or converted into an Adjusted Base Rate Advance pursuant to the
provisions of Section 2.13(c).

"Leverage Ratio” means the ratio on any date of (a) the Total Indebtedness on
such date to (b) the Parent’s Adjusted EBITDA for the Rolling Period immediately
preceding such date.

"Lien” means any mortgage, deed of trust, lien, pledge, charge, security
interest, encumbrance or other type of preferential arrangement to secure or
provide for the payment of any obligation of any Person, whether arising by
contract, operation of law or otherwise (including, without limitation, the
interest of a vendor or lessor under any conditional sale agreement, Capital
Lease or other title retention agreement).

"Liquid Investments” means:

(a) direct obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by, the United States;

(b) (i) negotiable or nonnegotiable certificates of deposit, time deposits, or
other similar banking arrangements maturing within 180 days from the date of
acquisition thereof (“bank debt securities”), issued by (A) any Lender with a
Revolving Commitment or (B) any other bank or trust company which has a combined
capital surplus and undivided profit of not less than $250,000,000 or the Dollar
Equivalent thereof, if at the time of deposit or purchase, such bank debt
securities are rated not less than “A” (or the then equivalent) by the rating
service of S&P or of Moody’s, and (ii) commercial paper issued by (A) any Lender
with a Revolving Commitment or (B) any other Person if at the time of purchase
such commercial paper is rated not less than “A-2” (or the then equivalent) by
the rating service of S&P or not less than “P-2” (or the then equivalent) by the
rating service of Moody’s, or upon the discontinuance of both of such services,
such other nationally recognized rating service or services, as the case may be,
as shall be selected by the Borrower with the consent of the Administrative
Agent;

(c) repurchase agreements relating to investments described in clauses (a) and
(b) above with a market value at least equal to the consideration paid in
connection therewith, with any Person who regularly engages in the business of
entering into repurchase agreements and has a combined capital surplus and
undivided profit of not less than $250,000,000 or the Dollar Equivalent thereof,
if at the time of entering into such agreement the debt securities of such
Person are rated not less than “A” (or the then equivalent) by the rating
service of S&P or of Moody’s; and

(d) such other instruments (within the meaning of New York’s Uniform Commercial
Code) as the Borrower may request and the Administrative Agent may approve in
writing, which approval will not be unreasonably withheld.

"Mandatorily Redeemable Stock” means, with respect to any Person, any Ownership
Interest of such Person which by the terms of such Ownership Interest (or by the
terms of any security into which it is convertible or for which it is
exchangeable or exercisable), upon the happening of any event or otherwise
(a) matures or is mandatorily redeemable, pursuant to a sinking fund obligation
or otherwise (other than an Ownership Interest which is redeemable solely in
exchange for common stock or Ownership Interests Equivalent thereof), (b) is
convertible into or exchangeable or exercisable for Indebtedness or Mandatorily
Redeemable Stock, or (c) is redeemable at the option of the holder thereof, in
whole or in part (other than an Ownership Interest which is redeemable solely in
exchange for common stock or Ownership Interests Equivalent thereof), in each
case on or prior to the Term Maturity Date.

"Margin Stock” shall have the meaning provided in Regulation U.

"Material Adverse Change” shall mean a material adverse change (a) in the
business, property, condition (financial or otherwise), prospects or results of
operations of the Borrower, the Parent and the other Guarantors taken as a
whole, in each case since December 31, 2003, or (b) in the validity or
enforceability of this Agreement or any of the other Credit Documents or the
rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.

"Material Subsidiary” means any Subsidiary of the Parent having assets or annual
revenues in excess of $1,000,000.

"Material Unconsolidated Entity” means any Unconsolidated Entity of the Parent
for which the Investment Amount is in excess of $1,000,000.

"Materials” has the meaning set forth in Section 5.05.

"Maturity Date” means, (a) with respect to any Revolving Advances, the Revolving
Maturity Date, and (b) with respect to any Term Advances, the Term Maturity
Date.

"Maximum Facility Amount” shall have the meaning provided in Section 2.01(c)(i).

"Maximum Rate” means the maximum nonusurious interest rate under applicable law.

"MHC” means MeriStar Hospitality Corporation, a Maryland corporation.

"MHC Letter” means a comfort letter and estoppel certificate executed by MHC and
MHC OP for the benefit of the Administrative Agent and the Lenders, and
acknowledged by the Borrower, pertaining to the Permitted Property Agreements
entered into between MHC and MHC’s Subsidiaries and the Parent and the Parent’s
Subsidiaries, in form and substance acceptable to the Administrative Agent.

"MHC OP” means MeriStar Hospitality Operating Partnership, L.P., a Delaware
limited partnership.

"Minimum Net Worth” means, with respect to the Parent, at any time, the sum of
$100,000,000 plus (a) 75% of the aggregate net proceeds or value received by the
Parent or any of its Subsidiaries after the date of this Agreement in connection
with any Capitalization Events taken as a whole, including without limitation in
connection with the acquisition of any Investment or other Property, plus (b) to
the extent a positive number, 75% of the aggregate Net Income of the Parent and
the Parent’s Subsidiaries for the period from and including October 1, 2004 to
the date of testing, on a Consolidated basis, minus (c) an amount equal to the
lesser of (i) $25,000,000 or (ii) the aggregate amount of all of the Parent’s
write-offs under GAAP of intangible assets that occur after September 30, 2004.

"Minority-Owned Fund” shall be defined as any fund for which the Parent and its
Subsidiaries collectively own less than 50% of the Ownership Interests of such
fund, but whose financial results are consolidated with the financial results of
the Parent and the Parent’s Subsidiaries under GAAP.

"Moody’s” means Moody’s Investor Service Inc.

"Mortgages” means, collectively, the deeds of trust and mortgages executed by
the Borrower or any Guarantor to secure the Obligations, each in form reasonably
acceptable to the Administrative Agent with such modifications as may be
necessary and appropriate in the opinion of counsel to the Administrative Agent
to comply with the state law of the filing jurisdiction and as may be reasonably
satisfactory to the Administrative Agent, as the same may be amended or
terminated in accordance with their terms, and “Mortgage” means any of such
instruments.

"Multiemployer Plan” means a “multiemployer plan” as defined in
Section 4001(a)(3) of ERISA to which the Parent, the Borrower or any member of
the Controlled Group is making or accruing an obligation to make contributions.

"Net Cash Proceeds” means (a) the aggregate cash proceeds (including, without
limitation, insurance and condemnation proceeds) received by the Parent, the
Borrower or any of their respective Subsidiaries (as applicable) in connection
with any Indebtedness incurrence on or after the Closing Date (excluding the
Obligations and the incurrence of other Indebtedness which does not trigger a
Repayment Event), Asset Disposition, Capitalization Event or casualty, minus
(b) the reasonable expenses of such Person in connection with such Indebtedness
incurrence, Asset Disposition, Capitalization Event or casualty, minus (c) to
the extent that assets disposed of in connection with an Asset Disposition
secure Indebtedness permitted pursuant to the provisions of Section 6.02(a), the
amount of such Indebtedness which is required to be repaid pursuant to the terms
of such Indebtedness in connection with such Asset Disposition, as reasonably
evidenced by the Borrower to the Administrative Agent.

"Net Income” means, for any Person or Hospitality Property, as applicable, for
any period for which such amount is being determined, the net income or net loss
of such Person (on a Consolidated basis) or Hospitality Property, as applicable,
after taxes, as determined on a Consolidated basis in accordance with GAAP,
excluding, however, (a) non-recurring expenses and (b) extraordinary items,
including but not limited to (i) any net gain or loss during such period arising
from the sale, exchange, or other disposition of capital assets (such term to
include all fixed assets and all securities) other than in the ordinary course
of business, and (ii) any write-up or write-down of assets.

"Net Worth” means, for any Person, stockholders equity of such Person determined
in accordance with GAAP.

"Non-Defaulting Lender” shall mean and include each Lender other than a
Defaulting Lender.

"Non-Replaced Property” means any Property owned by the Borrower or any of the
Guarantors which (a) was used in the ownership, operation or management of any
Hospitality Property, (b) has been conveyed, exchanged, transferred, or assigned
by the Borrower or a Guarantor to a Person other than the Borrower or a
Guarantor, (c) has not been replaced in the ordinary course of business by
Property of equal or better quality, and (d) was not included within the
definition of “Investments”.

"Note” means any of the Revolving Notes or the Term Notes, and “Notes” means all
of such promissory notes.

"Notice of Borrowing” means a notice of borrowing in the form of the attached
Exhibit G signed by a Responsible Officer of the Borrower.

"Notice of Conversion or Continuation” means a notice of conversion or
continuation in the form of the attached Exhibit H signed by a Responsible
Officer of the Borrower.

"Obligations” means all Advances, Letter of Credit Obligations, and other
amounts payable by the Borrower to the Administrative Agent, an Issuing Bank or
the Lenders under the Credit Documents.

"Other Taxes” has the meaning set forth in Section 2.11(b).

"Owned Hospitality Property” means a Hospitality Property owned by the Parent or
one of the Parent’s Subsidiaries or leased by the Parent or one of the Parent’s
Subsidiaries pursuant to a Ground Lease.

"Owned Hospitality Property Investments” shall mean Investments in (a) Owned
Hospitality Properties or (b) in Persons for which Hospitality Properties are
substantially all of such Person’s Property which results in the Parent directly
or indirectly owning 50% or more of the applicable Hospitality Property.

"Owned Hospitality Property Security Documents” for any Owned Hospitality
Property (other than one owned by a Permitted Other Subsidiary), means
collectively (a) a Mortgage, (b) an Assignment of Leases, and (c) such other
security agreements, pledge agreements, assignments, mortgages, financing
statements, stock powers, and other collateral documentation as the
Administrative Agent may reasonably request.

"Ownership Interests” means shares of stock, other securities, partnership
interests, member interests, beneficial interests or other interests in any
Person, whether voting or non-voting, and participations or other equivalents
(regardless of how designated) of or in a Person.

"Ownership Interests Collateral” has the meaning given such term in the
definition of “Collateral.”

"Ownership Interest Equivalents” means all securities (other than Ownership
Interests) convertible into or exchangeable for Ownership Interests and all
warrants, options or other rights to purchase or subscribe for any Ownership
Interests, whether or not presently convertible, exchangeable or exercisable.

"Parent” means Interstate Hotels & Resorts, Inc., a Delaware corporation.

"PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding
to any or all of its functions under ERISA.

"Permitted Asset Disposition” means an Asset Disposition which (a) occurs at a
time in which no Default has occurred and is continuing, and (b) would not cause
a Default to occur upon the consummation of such Asset Disposition.

"Permitted Encumbrances” means the Liens permitted to exist pursuant to
Section 6.01.

"Permitted Hazardous Substances” means (a) Hazardous Substances, petroleum and
petroleum products which are (i) used in the ordinary course of business and in
typical quantities for a Hospitality Property and (ii) generated, used and
disposed of in accordance with all Legal Requirements and good industry
practice, and (b) non-friable asbestos to the extent (i) that no applicable
Legal Requirements require removal of such asbestos from the Hospitality
Property and (ii) such asbestos is encapsulated in accordance with all
applicable Legal Requirements and such reasonable operations and maintenance
program as may be required by the Administrative Agent.

"Permitted Housing Agreements” means leases of Units as part of the Permitted
Housing Business (a) by the Borrower and its Subsidiaries to third parties and
(b) by third parties to the Borrower and its Subsidiaries.

"Permitted Housing Business” means the business of leasing Units, subleasing
such Units to another Person and providing ancillary services to such Person in
connection with such Units; provided that without the written consent of the
Required Lenders the Borrower and the Borrower’s Subsidiaries shall not enter
into new leases of Units or extend the term of existing leases of Units where
the leases cause the Borrower to violate any of the Permitted Housing Business
Leasing Guidelines.

"Permitted Housing Business Leasing Guidelines” means the requirement that the
Borrower and the Borrower’s Subsidiaries not lease Units or renew the lease of
Units if, upon consummation of such lease or renewal, (a) the aggregate number
of Units which have a term which exceeds 1 year without having a corresponding
sublease for such Unit to a credit-worthy Person for a similar term is equal to
or greater than 400, (b) the aggregate number of Units which have a term which
exceeds 5 years without having a corresponding sublease for such Unit to a
credit-worthy Person for a similar term is equal to or greater than 200, and
(c) the Borrower’s and the Borrower’s Subsidiaries’ aggregate lease obligations
for the leases of Units outside the United States, Canada and Western Europe
exceeds 15% of the Borrower’s and the Borrower’s Subsidiaries’ aggregate lease
obligations for Units.

"Permitted New Investments” means the following Investments made after the
Closing Date:

(a) Investments (i) to acquire Permitted Property Agreements and (ii) in Persons
for which Permitted Property Agreements are substantially all of such Person’s
Property, which Persons become majority-owned Subsidiaries of the Borrower,
provided that no individual Investment under the foregoing clauses (i) or
(ii) shall have an Investment Amount which exceeds $5,000,000;

(b) Sliver Investments for which (i) the Investment Amount for any individual
Investment does not exceed $10,000,000 and (ii) the Investment Amount for all
such Investments in the aggregate does not exceed $50,000,000.

(c) an equity Investment in one fund (or parallel funds investing in the same
Investments) (i) whose Investments will be limited to Hospitality Properties for
which the Borrower or its wholly-owned subsidiary will have a Customary Property
Agreement, (ii) whose Investments will be limited such that the Borrower’s
direct or indirect share of any individual Investment does not exceed an
Investment Amount of $10,000,000, (iii) for which Borrower’s direct or indirect
Investment in such fund(s) does not exceed an Investment Amount of $50,000,000
in the aggregate, and (iv) in which the Borrower or its Subsidiary owns 25% or
less of the Ownership Interests in such fund(s), provided that the Borrower and
its Subsidiaries and Affiliates cannot invest in more than one fund (or parallel
funds) under this paragraph (c), nor treat any Investment that would qualify as
the one fund (or parallel funds) under this paragraph (c) as any other type of
Permitted Investment;

(d) Investments in Persons that have Permitted Property Agreements which meet
the requirements of the foregoing paragraph (a), but are not majority-owned
Subsidiaries of the Borrower; provided that the aggregate Investment Amount of
all such Investments can not exceed $10,000,000;

(e) Investments (i) in Persons that are in the Permitted Housing Business, or
(ii) for agreements related to the Permitted Housing Business; provided that the
aggregate Investment Amount of all such Investments can not exceed $5,000,000;

(f) Owned Hospitality Property Investments, provided that:

(i) the aggregate Investment Amount in Owned Hospitality Property Investments,
excluding the Investment Amount in Existing Owned Hospitality Property
Investments, shall not at any time exceed the sum of (A) $100,000,000 plus
(B) the Net Cash Proceeds from a Capitalization Event which are not required by
the terms of this Agreement to repay Advances and which are utilized within one
year of the date of such Capitalization Event to make such type of Investment.
For purposes of such calculation the value of any limited partnership interests
in the Borrower exchanged in connection with such Investment shall be excluded
from the Investment Amount,

(ii) at least five (5) Business Days prior to acquiring an Owned Hospitality
Property Investment the Borrower shall have delivered to the Administrative
Agent the Property Information for the applicable Hospitality Property,

(iii) any Ground Lease for an Owned Hospitality Property must be financable in
the reasonable opinion of the Administrative Agent,

(iv) no more than twenty percent (20%) of the hotel rooms in the applicable
Hospitality Property may be subject to a timeshare regime, and

(v) to the extent that such Investment would be included in the definition of
Collateral, the provisions of Section 5.09(a) are satisfied;

(g) Equity Investments in Persons that provide services to current or future
Hospitality Properties for which either (i) the Parent or its direct or indirect
Subsidiary has a Permitted Property Agreement or (ii) the Parent directly or
indirectly owns 50% or more of the applicable Hospitality Property; provided
that the aggregate Investment Amount of all such Investments can not exceed
$10,000,000; and

(h) up to $5,000,000 for non-Hospitality Property related Investments.

If any Investment involves (a) multiple Permitted Property Agreements or an
Investment in a Person which has multiple Permitted Property Agreements and
(b) is in a class of permitted investment subject to individual Investment
Amount limitations, then for purposes of testing such individual Investment
Amount limitations only, the total Investment Amount for such Investment shall
be divided by the number of Hospitality Properties which would be subject to
Permitted Property Agreements with the Borrower or its majority-owned
Subsidiary.

In addition to the foregoing limitations, with respect to Investments in Persons
that qualified under paragraphs (a) or (b) above, the Investment Amount of the
Borrower’s additional Investments in such Person following the respective
initial Investments shall not in any year exceed $10,000,000 in the aggregate
for all such Investments.

"Permitted Non-Recourse Designated Entity Indebtedness” means Indebtedness of an
Unconsolidated Entity or a Minority-Owned Fund which (a) is incurred by an
Unconsolidated Entity or a Minority-Owned Fund to acquire a Hospitality Property
or Hospitality Management Business or refinance such acquisition Indebtedness,
and (b) is non-recourse to the Parent, the Borrower and their respective
Subsidiaries except for the Property of or the Ownership Interests in such
Unconsolidated Entity or Minority-Owned Fund, as applicable, and customary
recourse “carve-outs”.

"Permitted Other Indebtedness” means:

(a) Indebtedness which (i) is incurred by a Permitted Other Subsidiary to
(A) acquire an Owned Hospitality Property Investment which qualifies as a
Permitted New Investment, (B) refinance Indebtedness incurred to acquire a
Permitted New Investment, or (C) finance the Pittsburgh Property, where the
Indebtedness incurred does not exceed 65% of the Investment Amount for such
Permitted New Investment or Pittsburgh Property, as applicable, and (ii) is
non-recourse to the Parent, the Borrower and their respective Subsidiaries
except for the Property of or the Ownership Interests in such Permitted Other
Subsidiary and customary recourse “carve-outs”;

(b) Unsecured Indebtedness (excluding the Obligations and any other Indebtedness
separately listed in this definition of “Permitted Other Indebtedness”)
(i) which in the aggregate does not exceed $200,000,000, (ii) for which not more
than $100,000,000 may be Senior Indebtedness, (iii) which matures after the
Maturity Date, and (iv) which is subject to terms and conditions reasonably
acceptable to the Administrative Agent;

(c) Approved Inter-Company Indebtedness;

(d) Indebtedness of the Dallas Pledgors to FelCor in the amount of approximately
$4,170,000, secured by the interests of the Dallas Pledgors in FCH/IHC Hotels,
L.P.;

(e) Pre-Existing Designated Indebtedness, provided that the Borrower will use a
portion of the first Advances under this Agreement to repay such Indebtedness;

(f) Permitted Non-Recourse Designated Entity Indebtedness;

(g) Indebtedness in the amount of $2,000,000 payable to Sunstone Hotel Investors
LLC on December 31, 2005.

(h) minority Ownership Interests reflected on the Parent’s financial statements
as Indebtedness.

"Permitted Other Subsidiary” means a Subsidiary of the Parent which (a) is a
single-purpose Person, (b) has never been a Guarantor, nor owned any Collateral,
and (c) only owns Permitted New Investments acquired in whole or in part with
the proceeds of Indebtedness excluding the proceeds of Advances and other
Property ancillary to such Permitted New Investments.

"Permitted Property Agreements” means (a) Existing Management Agreements and (b)
Customary Property Agreements related to Hospitality Properties entered into
after the Closing Date.

"Person” means an individual, partnership, corporation (including a business
trust), joint stock company, trust, unincorporated association, limited
liability company, joint venture or other entity, or a government or any
political subdivision or agency thereof or any trustee, receiver, custodian or
similar official.

"Pittsburgh Property” means the Pittsburgh, Pennsylvania Airport Residence Inn
(Park Lane).

"Plan” means an employee benefit plan (other than a Multiemployer Plan)
maintained for employees of the Parent, the Borrower or any member of the
Controlled Group and covered by Title IV of ERISA or subject to the minimum
funding standards under Section 412 of the Code.

"Platform” has the meaning set forth in Section 5.05.

"Pre-Existing Designated Indebtedness” means the Lehman Indebtedness and the
advances under the Existing Credit Agreement to the extent that such advances
are not continued as Advances under this Agreement.

"Prescribed Forms” means such duly executed form(s) or statement(s), and in such
number of copies, which may, from time to time, be prescribed by law and which,
pursuant to applicable provisions of (a) an income tax treaty between the United
States and the country of residence of the Lender providing the form(s) or
statement(s), (b) the Code, or (c) any applicable rule or regulation under the
Code, permit the Borrower to make payments hereunder for the account of such
Lender free of (or, upon written request of the Borrower specifying the
applicable form, at a reduced rate of) deduction or withholding of income or
similar taxes (except for any deduction or withholding of income or similar
taxes as a result of any change in or in the interpretation of any such treaty,
the Code or any such rule or regulation).

"Prime Rate” means a fluctuating interest rate per annum as shall be in effect
from time to time equal to the rate of interest publicly announced by the
Administrative Agent as its prime commercial lending rate (which may not be the
lowest rate offered to its customers), whether or not the Borrower has notice
thereof.

"Property” of any Person means any property or assets (whether real, personal,
or mixed, tangible or intangible) of such Person, including without limitation,
the Permitted Property Agreements, the Permitted Housing Agreements, and all
Owned Hospitality Properties.

"Property Information” for any Owned Hospitality Property means the following
information and documentation for such Owned Hospitality Property:

(a) an Engineering Report;

(b) an Environmental Report;

(c) a commitment for a Title Policy, together with a legible copy of all
documents referred to in such commitment;

(d) a current Appraisal satisfactory to the Administrative Agent;

(e) a copy of the agreements pursuant to which the Owned Hospitality Property is
being acquired;

(f) a ALTA/ASCM survey reasonably satisfactory to the Administrative Agent; and

(g) all financial statements reasonably required by the Administrative Agent.

"Pro Rata Share” means, at any time with respect to any Lender, the ratio
(expressed as a percentage) of (a) such Lender’s Commitments, plus, to the
extent any Class of Commitment has been terminated, such Lender’s outstanding
Advances for such Class (and participation interest in the Letter of Credit
Exposure if the Revolving Commitments have been terminated) to (b) all Lenders’
aggregate Commitments, plus, to the extent any Class of Commitment has been
terminated, all Lenders’ aggregate outstanding Advances for such Class (and
participation interest in the Letter of Credit Exposure if the Revolving
Commitments have been terminated).

"Public Lender” has the meaning set forth in Section 5.05.

"Register” has the meaning set forth in paragraph (c) of Section 10.06.

"Regulation U” shall mean Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof.

"Reinsurance Contract” means each outstanding reinsurance, coinsurance and other
similar contract of each Insurance Company.

"Reinvestment Amount” means $10,000,000, provided that for the Rolling Periods
which fall during and immediately after the Fiscal Quarter in which the Parent
and the Borrower sells all or substantially all of the Permitted Housing
Business the Reinvestment Amount shall be $25,000,000.

"Related Fund” means, with respect to any Approved Fund, any other Approved Fund
that invests in commercial loans which is advised or managed by the same
investment advisor as such Approved Fund or an Affiliate of such investment
advisor.

"Release” shall have the meaning set forth in CERCLA or under any other
Environmental Law.

"Repayment Amount” means (a) with respect to any Indebtedness incurrence or
Asset Disposition, the Net Cash Proceeds from such event, and (b) with respect
to any Capitalization Event, (i) if at the time of such Capitalization Event the
Leverage Ratio prior to use of the Net Cash Proceeds from such Capitalization
Event is greater than 3.00 to 1.00, then the lesser of (A) 50% of the Net Cash
Proceeds from such Capitalization Event and (B) the amount that would reduce the
Leverage Ratio to 3.00 to 1.00 after taking into account the repayment of
Advances by such amount, and (ii) otherwise, $0.

"Repayment Event” means the incurrence of any of the following on or after the
Closing Date by the Parent, the Borrower or one of their respective
Subsidiaries:

(a) the incurrence of any Indebtedness excluding (i) the incurrence of any
Obligations, (ii) the incurrence of Indebtedness under clause (a) of the
definition of “Permitted Other Indebtedness” incurred to make a Permitted New
Investment, and (iii) the refinancing of Indebtedness previously incurred under
clause (a), (b) or (f) of the definition of “Permitted Other Indebtedness” up to
the amount of the Indebtedness refinanced;

(b) a Capitalization Event;

(c) an Asset Disposition or the payment to the Borrower or one of the Borrower’s
Subsidiaries of a termination payment under a Permitted Property Agreement or a
Permitted Housing Agreement after the Closing Date, provided that a Repayment
Event shall not be deemed to have occurred for:

(i) Asset Dispositions (but not termination payments) for which the aggregate
Net Cash Proceeds do not exceed $1,000,000 in any Rolling Period, and

(ii) Asset Dispositions (including termination payments) for which:

(A) the aggregate Net Cash Proceeds do not exceed the Reinvestment Amount during
any Rolling Period; provided that (1) the Net Cash Proceeds from termination
payments shall not be counted toward such Reinvestment Amount threshold; (2) the
Net Cash Proceeds from a condemnation shall not be counted toward such
Reinvestment Amount threshold to the extent such Net Cash Proceeds are utilized
for the restoration of the Owned Hospitality Property affected by such casualty
or condemnation within one year of the date of such casualty or condemnation;
and (3) only the aggregate Net Cash Proceeds in excess of the Reinvestment
Amount during any Rolling Period shall be deemed to be part of a Repayment Event
under this paragraph (c); and

(B) the Net Cash Proceeds from such Asset Disposition are used to make a
Permitted New Investment(s) by the end of the Rolling Period which commences
after the Fiscal Quarter in which such Asset Disposition occurred.

(d) A casualty to an Owned Hospitality Property other than a casualty for which
the aggregate Net Cash Proceeds either (i) does not exceed $1,000,000 or
(ii) are utilized for the restoration of the Owned Hospitality Property affected
by such casualty within one year of the date of such casualty.

"Reportable Event” means any of the events set forth in Section 4043(b) of
ERISA.

"Required Lenders” means Non-Defaulting Lenders the sum of whose outstanding
Term Advances (and, prior to the termination thereof, Term Commitments) and
Revolving Commitments (or after the termination thereof, outstanding Revolving
Advances and participations in Letter of Credit Exposure) represent at least 51%
of the sum of all outstanding Term Advances (and, if prior to the termination
thereof, Term Commitments) of Non-Defaulting Lenders and the sum of all
Revolving Commitments of Non-Defaulting Lenders (or after the termination of the
Revolving Commitments, the sum of the then total outstanding Revolving Advances
of Non-Defaulting Lenders, and the aggregate participations of all
Non-Defaulting Lenders of Letter of Credit Exposure at such time); provided that
with respect to a vote which only involves a certain Class or Classes, only the
Commitments and Advances for the applicable Class or Classes shall be used in
the calculation of Required Lenders.

"Response” shall have the meaning set forth in CERCLA or under any other
Environmental Law.

"Responsible Officer” means the Chairman of the Board, Chief Executive Officer,
President, Executive Vice President, Chief Financial Officer, Chief Accounting
Officer or Treasurer of any Person, or, with respect to a partnership, the
general partner of such Person.

"Restricted Payment” means (a) any direct or indirect payment, prepayment,
redemption, purchase, or deposit of funds or Property for the payment (including
any sinking fund or defeasance), prepayment, redemption or purchase of any
Indebtedness not permitted by this Agreement or any Subordinate Indebtedness,
and (b) the making by any Person of any dividends or other distributions (in
cash, property, or otherwise) on, or payment for the purchase, redemption or
other acquisition of, any Ownership Interests of such Person, other than
dividends or distributions payable in such Person’s Ownership Interests.

"Revolving Advance” means any advance by a Lender to the Borrower in Dollars
pursuant to such Lender’s Revolving Commitment or a continuation of an existing
Revolving Advance, and refers to an Adjusted Base Rate Advance or a Eurodollar
Rate Advance.

"Revolving Commitment” means, for each Lender, the Revolving Commitment set
forth for such Lender as its Revolving Commitment in the Register maintained by
the Administrative Agent pursuant to Section 10.06(c). As of the Effective Date,
the aggregate amount of the Revolving Commitments under this Agreement is
$55,000,000.

"Revolving Exposure” at any time shall mean the sum of (i) the aggregate
principal amount of all Revolving Advances and (ii) the aggregate amount of all
Letter of Credit Exposure at such time.

"Revolving Incremental Funding Date” shall have the meaning provided in Section
2.01(c)(iii).

"Revolving Maturity Date” means January 14, 2008.

"Revolving Note” means a promissory note of the Borrower payable to the order of
any Lender, in substantially the form of the attached Exhibit A-1, evidencing
Indebtedness of the Borrower to such Lender resulting from Revolving Advances
from such Lender, and “Revolving Notes” means all of such promissory notes.

"Revolving Required Lenders” means Non-Defaulting Lenders the sum of whose
Revolving Commitments (or after the termination thereof, outstanding Revolving
Advances and participations in Letter of Credit Exposure) represent at least 51%
of the sum of all Revolving Commitments of Non-Defaulting Lenders (or after the
termination of the Revolving Commitments, the sum of the then total outstanding
Revolving Advances of Non-Defaulting Lenders, and the aggregate participations
of all Non-Defaulting Lenders of Letter of Credit Exposure at such time).

"Revolving Share” means, at any time with respect to any Lender with a Revolving
Commitment or outstanding Revolving Advance, the ratio (expressed as a
percentage) of such Lender’s Revolving Commitment at such time to the aggregate
Revolving Commitments at such time, or, if the Revolving Commitments have been
terminated, the ratio (expressed as a percentage) of such Lender’s Revolving
Advances at such time to the aggregate Revolving Advances at such time.

"Rolling Period” means, as of any date, the four Fiscal Quarters ending
immediately preceding such date.

"S&P” means Standard & Poor’s Ratings Group, a division of McGraw-Hill, Inc., or
any successor thereof.

"SAP” means, with respect to each Insurance Company, the statutory accounting
practices prescribed or permitted by the insurance commissioner (or other
similar Governmental Authority) in the jurisdiction of such Insurance Company
for the preparation of Insurance Annual Statements and other financial reports
by insurance companies of the same type in effect from time to time, applied in
a manner consistent with those used in preparing the SAP Financial Statements.

"SAP Financial Statements” means the audited annual and unaudited quarterly
convention statements filed with the domiciliary state insurance departments of
each Insurance Company.

"Security Agreement” means the Amended and Restated Security Agreement in favor
of the Administrative Agent from the Borrower, the Parent and the other
Guarantors, granting a Lien in all existing and future Collateral of the
Borrower and its Subsidiaries in substantially the form of the attached
Exhibit I.

"Security Documents” means the Security Agreement, all Owned Hospitality
Property Security Documents, all Financing Statements and each other document,
instrument or agreement executed in connection therewith or otherwise executed
in order to secure all or a portion of the Obligations; and any “Security
Document” means any one of the foregoing.

"Senior Indebtedness” means the Total Indebtedness minus the Subordinate
Indebtedness.

"SG Americas” means SG Americas Securities, LLC.

"Sliver Investments” shall mean debt and equity investments in partnerships,
companies or limited liability companies (a) for which the Borrower’s direct or
indirect ownership interest is less than 50% and (b) that own hospitality
properties for which the Borrower or its wholly-owned subsidiary will have a
Customary Property Agreement.

"Status” means the existence of Level I Status, Level II Status or Level III
Status, as the case may be. As used in this definition:

"Level I Status” exists at any date if, at such date, the Leverage Ratio at the
end of the preceding Rolling Period is less than 3.0;

"Level II Status” exists at any date if, at such date, the Leverage Ratio at the
end of the preceding Rolling Period is equal to or greater than 3.0, but less
than 3.25; or

"Level III Status” exists at any date if, at such date, the Leverage Ratio at
the end of the preceding Rolling Period is equal to or greater than 3.25.

Status shall be determined and changed as of the Status Reset Date following any
Fiscal Quarter; provided that if the Borrower fails to timely provide (a) the
financial statements needed to recalculate the Leverage Ratio as required by the
provisions of Section 5.05(a) prior to the 50th day following the end of any
Fiscal Quarter (except for the Fiscal Quarter which ends on the date the Fiscal
Year ends), (b) the draft Compliance Certificate related to the end of the
Fiscal Year as required by the provisions of Section 5.05(b) prior to the 50th
day following the end of any Fiscal Year or (c) the financial statements needed
to recalculate the Leverage Ratio as required by the provisions of
Section 5.05(b) prior to the 95th day following the end of any Fiscal Year, then
Status shall automatically be reset at the Status one level higher than the
Status existing immediately prior to such Status reset until such time as the
Borrower provides such financial statements or draft Compliance Certificate, as
applicable; provided further that at the Closing Date the Status under the
Credit Agreement will be set at Level III Status and such Status shall not be
reduced until the next Status Reset Date following the Closing Date.

"Status Reset Date” means the date following the end of any Fiscal Quarter which
is the earlier of (a) the 50th day following the end of such Fiscal Quarter and
(b) the date which is five (5) days following the delivery of the reports and
other documents required by (i) the provisions of Section 5.05(a) for such
Fiscal Quarter (except for the Fiscal Quarter which ends on the date the Fiscal
Year ends) or (ii) the provisions of Section 5.05(b) for the Fiscal Quarter
which ends on the date the Fiscal Year ends; provided that the documents
contemplated by the preceding clause (ii) shall never be deemed delivered prior
to the 40th day following the end of the Fiscal Year.

"Subordinate Indebtedness” means Indebtedness of the Borrower, the Parent and
their respective Subsidiaries which (a) shall not mature, become payable or
require the payment of any principal amount thereof (or any amount in lieu
thereof) or be mandatorily redeemable, pursuant to a sinking fund or otherwise
redeemable at the option of the holder thereof, in any case in whole or in part,
before the date that is 181 days after the Term Maturity Date and (b) shall be
junior and subordinate to the Obligations and subject to an intercreditor
agreement or subordination provisions and other terms and provisions which are
acceptable to the Administrative Agent.

"Subsidiary” means, with respect to any Person, at any date, any other Person in
whom such Person holds an Investment and whose financial results would be
consolidated under GAAP with the financial results of such Person if such
statements were prepared as of such date.

"Taxes” has the meaning set forth in Section 2.11(a).

"Telerate” means the Telerate System.

"Term Advance” means any advance by a Lender to the Borrower pursuant to such
Lender’s Term Commitment or a continuation of an existing Term Advance, and
refers to an Adjusted Base Rate Advance or a Eurodollar Rate Advance.

"Term Commitment” means, for each Lender, the Term Commitment set forth for such
Lender as its Term Commitment in the Register maintained by the Administrative
Agent pursuant to Section 10.06(b); provided, however, that after the date the
initial Term Advance of a Lender is made, the Term Commitment for such Lender
shall be zero. As of the Effective Date, the aggregate amount of the Term
Commitments under this Agreement is $53,000,000.

"Term Incremental Funding Date” shall have the meaning provided in Section
2.01(c)(ii).

"Term Maturity Date” means January 14, 2008.

"Term Note” means a promissory note of the Borrower payable to the order of any
Lender in substantially the form of the attached Exhibit A-2, evidencing
Indebtedness of the Borrower to such Lender resulting from any Term Advance from
such Lender, and “Term Notes” means all such Term Notes.

"Term Required Lenders” means Non-Defaulting Lenders the sum of whose
outstanding Term Advances (and, prior to the termination thereof, Term
Commitments) represent at least 51% of the sum of all outstanding Term Advances
(and, if prior to the termination thereof, Term Commitments) of Non-Defaulting
Lenders.

"Term Share” means, at any time with respect to any Lender with a Term
Commitment or outstanding Term Advance, the ratio (expressed as a percentage) of
such Lender’s Term Commitment at such time to the aggregate Term Commitments at
such time, or, if the Term Commitments have been terminated, the ratio
(expressed as a percentage) of such Lender’s Term Advances at such time to the
aggregate Term Advances at such time.

"Termination Event” means (a) the occurrence of a Reportable Event with respect
to a Plan, as described in Section 4043 of ERISA and the regulations issued
thereunder (other than a Reportable Event not subject to the provision for
30-day notice to the PBGC under such regulations), (b) the withdrawal of the
Borrower or any of the Controlled Group from a Plan during a plan year in which
it was a “substantial employer” as defined in Section 4001(a)(2) of ERISA, (c)
the giving of a notice of intent to terminate a Plan under Section 4041(c) of
ERISA, (d) the institution of proceedings to terminate a Plan by the PBGC, or
(e) any other event or condition which constitutes grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer, any
Plan.

"Threshold Amount” means (a) with respect to Indebtedness which is either
Subordinate Indebtedness or Indebtedness which is non-recourse to the Borrower
and the Guarantors (except for customary recourse “carve-outs”) which is
outstanding in a principal amount of at least $10,000,000 individually or when
aggregated with all such Indebtedness and (b) with respect to any other
Indebtedness which is outstanding in a principal amount of at least $5,000,000
individually or when aggregated with all such Indebtedness.

"Title Policy” means a Mortgagee Policy of Title Insurance which (a) is in the
form of American Land Title Association Standard Loan Policy — 1970 (without
modification, revision or amendment) (or such other form as approved by the
Administrative Agent) with endorsements reasonably requested by the
Administrative Agent, (b) is issued by an underwriter reasonably acceptable to
the Administrative Agent, (c) insures that the grantor of the Lien insured by
such policy owns the Owned Hospitality Property subject to such Lien in fee
simple or pursuant to a leasehold estate and that the Mortgage covering such
Owned Hospitality Property is a valid lien on such Owned Hospitality Property in
favor of the Administrative Agent for the benefit of the Lenders (subject only
to Permitted Encumbrances), (d) does not contain any exceptions for rights of
parties in possession, or unpaid delinquent installments of taxes, special
assessments or subsequent assessments due to changes in ownership or usage, or
any other exceptions to coverage other than Permitted Encumbrances.

"Total Indebtedness” means all Indebtedness of the Borrower, the Parent and
their respective Subsidiaries on a Consolidated basis, provided that “Total
Indebtedness”

(a) shall not include any Permitted Non-Recourse Designated Entity Indebtedness;

(b) shall include, without duplication, any Indebtedness of an Unconsolidated
Entity or a Minority-Owned Fund which does not qualify under the foregoing
clause (a); and

(c) shall not include the amount of any minority interests.

"Type” has the meaning set forth in Section 1.04.

"Unconsolidated Entity” means, with respect to any Person, at any date, any
other Person in whom such Person holds an Investment and whose financial results
would not be consolidated under GAAP with the financial results of such Person
if such statements were prepared as of such date.

"Units” means apartment or condominium units.

"Unsecured Indebtedness” of any Person means the Indebtedness of such Person for
which the obligations thereunder are not secured by a Lien on any assets of such
Person or its Subsidiaries.

"Wyndham” means Wyndham International, Inc.

Section 1.02 Computation of Time Periods. In this Agreement in the computation
of periods of time from a specified date to a later specified date, the word
“from” means “from and including” and the words “to” and “until” each means “to
but excluding”.

Section 1.03 Accounting Terms; Changes in GAAP.

(a) All accounting terms not specifically defined in this Agreement shall be
construed in accordance with GAAP applied on a consistent basis.

(b) Unless otherwise indicated, all financial statements of the Borrower and the
Parent, all calculations for compliance with covenants in this Agreement, and
all calculations of any amounts to be calculated under the definitions in
Section 1.01 shall be based upon the Consolidated accounts of the Borrower, the
Parent and their respective Subsidiaries (as applicable) in accordance with
GAAP.

(c) If any changes in accounting principles after December 31, 2003 required by
GAAP or the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants or similar agencies results in a change in the
method of calculation of, or affects the results of such calculation of, any of
the financial covenants, standards or terms found in this Agreement, then the
parties shall enter into and diligently pursue negotiations in order to amend
such financial covenants, standards or terms so as to equitably reflect such
change, with the desired result that the criteria for evaluating the financial
condition of Borrower and its Subsidiaries (determined on a Consolidated basis)
shall be the same after such change as if such change had not been made.

Section 1.04 Classes and Types of Advances. Advances are distinguished by
“Class” and “Type”. The “Class” of an Advance refers to the determination
whether such Advance is a Term Advance or a Revolving Advance, each of which
constitutes a Class. The “Type” of an Advance refers to the determination
whether such Advance is a Eurodollar Rate Advance or an Adjusted Base Rate
Advance, each of which constitutes a Type.

Section 1.05 Miscellaneous. Article, Section, Schedule and Exhibit references
are to Articles and Sections, of and Schedules and Exhibits, to this Agreement,
unless otherwise specified.

Section 1.06 Amendment and Restatement. The parties hereto agree that this
Amended and Restated Senior Secured Credit Agreement constitutes for all
purposes an amendment to the Existing Credit Agreement and not a new or
substitute agreement or a novation of the Existing Credit Agreement. In
addition, the parties hereto agree to use reasonable efforts to accomplish the
matters set forth in the preliminary statements of this Agreement and, without
limitation, agree to the following:

(a) For each Lender which does not have an Existing Note which requests a Note,
the Borrower will execute a Revolving Note and/or Term Note, as applicable,
payable to such Lender in the amount of such Lender’s Revolving Commitment
and/or Term Commitment, as applicable, which Note(s) will constitute the Note(s)
the Borrower is obligated to deliver to such Lender as provided in
Section 2.02(g).

(b) For each Lender which has an Existing Note which requests a Note, the
Borrower will execute a Revolving Note and/or Term Note, as applicable, payable
to such Lender in the amount of such Lender’s Revolving Commitment and/or Term
Commitment, as applicable, which Note(s) (i) will replace in its/their entirety
such Lender’s Existing Note(s) and either increase or decrease, as applicable,
the Indebtedness evidenced by the Existing Note(s) and (ii) constitute the
Note(s) the Borrower is obligated to deliver to such Lender as provided in
Section 2.02(g).

ARTICLE II

THE ADVANCES AND THE LETTERS OF CREDIT

Section 2.01 The Advances.

(a) Term Advances. Subject to the terms and conditions set forth in this
Agreement, each Lender severally agrees to make a Term Advance to the Borrower
on the Effective Date, in an aggregate amount equal to such Lender’s Term
Commitment. No amount of any Term Advance that has been repaid or prepaid may be
reborrowed.

(b) Revolving Advances. Subject to and upon the terms and conditions set forth
herein, each Lender severally agrees at any time and from time to time on any
Business Day up to fifteen (15) days prior to the Revolving Maturity Date to
make Revolving Advances; provided that Revolving Advances shall not be made (or
be required to be made) by any Lender on any date if, after giving effect
thereto, (i) such Lender’s Revolving Share of the Revolving Exposure would
exceed such Lender’s Revolving Commitment at such time, or (ii) the Revolving
Exposure would exceed the aggregate Revolving Commitments of the Lenders at such
time. Within the limits of each Lender’s Revolving Commitment, the Borrower may
from time to time prepay Revolving Advances pursuant to the provisions of
Section 2.07 and reborrow Revolving Advances under this Section 2.01(b).

(c) Commitments Increase.

(i) The Borrower shall be entitled to request that the aggregate Commitments be
increased by an amount not exceeding Fifty Million Dollars ($50,000,000), which
may be allocated between Revolving Commitments, Term Commitments and commitments
for other term advances as the Borrower shall elect; provided that (A) no
Default then exists or would result therefrom, (B) the Borrower gives the
Lenders twenty (20) days prior written notice of such election, (C) no Lender
shall be obligated to increase such Lender’s Commitment without such Lender’s
written consent which may be withheld in such Lender’s sole discretion, (D) the
Borrower, not the Lenders or the Administrative Agent, is responsible for
arranging for Persons to provide the additional Commitment amounts, (E) if any
Person providing any additional Commitment amount is not already a Lender, then
such Person must qualify as an Eligible Assignee and be reasonably acceptable to
the Borrower, the Administrative Agent, and, if a Revolving Commitment increase
is proposed, the Issuing Bank, (F) such increase in the Commitments shall not
cause the sum of (1) the Revolving Commitments (and following termination
thereof, Revolving Exposure) and (2) the Term Advances (and, prior to the
termination thereof, Term Commitments) to exceed $158,000,000 (the “Maximum
Facility Amount”), (G) each existing Lender shall have the right, but not the
obligation, to provide such Lender’s Pro Rata Share of any increase in
Commitments, with each such Lender having to make such election within ten
(10) days of receipt of the Borrower’s notice of election to increase the
Commitments; provided that if following such elections by existing Lenders the
Borrower has not yet reached the Maximum Facility Amount, then in connection
with the Borrower’s pending request for additional Commitments the Borrower will
be entitled to offer additional Commitments to non-Lenders without having to
again offer additional Commitments to existing Lenders in an amount up to the
lesser of (1) the original amount of increase in Commitments proposed by the
Borrower and (2) the amount of increase in Commitments which would cause the
Borrower to reach the Maximum Facility Amount, and (H) to the extent that the
Borrower desires to add additional term loan commitments which do not have the
same maturity date or interest rate as the existing Term Advances, then (1) such
additional term loans will not have a weighted average life to maturity shorter
than that of the existing Term Advances, and (2) such term loans will not have
an Applicable Margin greater than that for the existing Term Advances unless the
Applicable Margin for the existing Term Advances is also increased to the same
Applicable Margin as that for the new term loans. In connection with any such
increase in the Commitments (A) the Borrower will provide pro forma projections
reasonably acceptable to the Administrative Agent that reflect compliance with
the financial covenants contained in this Agreement following such increase,
(B) the parties shall execute any documents reasonably requested in connection
with or to evidence such increase, including without limitation an amendment to
this Agreement, and (C) the Administrative Agent shall be authorized on behalf
of the Lenders and the Issuing Bank to execute any amendments to the Credit
Documents which are reasonably necessary or desirable in connection with such
increase.

(ii) With respect to any increase in Term Commitments permitted under the
foregoing paragraph (i), each Lender whose Term Commitment has increased would
severally agree to make a Term Advance to the Borrower in the amount of such
Lender’s Term Commitment increase on the date (the “Term Incremental Funding
Date”) designated by the Administrative Agent. After the date such Term Advance
of a Lender is made, the increased Term Commitment for such Lender shall be zero
and such Term Advance will be treated as a Term Advance for all purposes under
the Credit Documents. However, the first payment of interest received by the
Administrative Agent after such Term Incremental Funding Date shall be paid to
the Lenders in amounts adjusted to reflect their respective outstanding Term
Advances over the period for which interest was paid.

(iii) With respect to any increase in Revolving Commitments permitted under the
foregoing paragraph (i), on the date (the “Revolving Incremental Funding Date”)
designated by the Administrative Agent, the Lenders whose Revolving Commitments
have increased in connection with such future increase in the Total Commitments
shall fund to the Administrative Agent such amounts as may be required to cause
each of them to hold its Revolving Share of Revolving Advances based upon the
Commitments as of such Revolving Incremental Funding Date, and the
Administrative Agent shall distribute the funds so received to the other Lenders
in such amounts as may be required to cause each of them to hold its Revolving
Share of Revolving Advances as of such Revolving Incremental Funding Date. The
Lenders receiving such amounts to be applied to Eurodollar Rate Advances may
demand payment of the breakage costs under Section 2.08 as though Borrower had
elected to prepay such Eurodollar Rate Advances on such date and the Borrower
shall pay the amount so demanded as provided in Section 2.08. The first payment
of interest and letter of credit fees received by the Administrative Agent after
such Revolving Incremental Funding Date shall be paid to the Lenders in amounts
adjusted to reflect the adjustments of their respective Revolving Shares of the
Revolving Advances as of the Revolving Incremental Funding Date. On the
Revolving Incremental Funding Date each Lender shall be deemed to have either
sold or purchased, as applicable, participations in the Letter of Credit
Exposure sold to the Lenders pursuant to Section 2.13(b) so that upon
consummation of all such sales and purchases each Lender holds participations in
the Letter of Credit Exposure equal to such Lender’s Revolving Share of the
total Letter of Credit Exposure as of such Revolving Incremental Funding Date.

Section 2.02 Method of Borrowing.

(a) Notice.

(i) Each Borrowing shall be made pursuant to a Notice of Borrowing, given not
later than 12:00 noon (New York, New York time) (A) on the third Business Day
before the date of the proposed Borrowing, in the case of a Borrowing consisting
of Eurodollar Rate Advances, or (B) on the Business Day before the date of the
proposed Borrowing, in the case of a Borrowing consisting of Adjusted Base Rate
Advances, by the Borrower to the Administrative Agent, which shall give each
Lender prompt notice on the day of receipt of such timely Notice of Borrowing of
such proposed Borrowing by telecopier. Each Notice of Borrowing shall be in
writing or by telecopier specifying the requested (A) date of such Borrowing,
(B) Type and Class of Advance comprising such Borrowing, (C) aggregate amount of
such Borrowing, and (D) if such Borrowing is to be comprised of Eurodollar Rate
Advances, the Interest Period for each such Advance. In the case of a proposed
Borrowing comprised of Eurodollar Rate Advances, the Administrative Agent shall
promptly notify each Lender of the applicable interest rate under
Section 2.06(b). With respect to all Advances, each Lender shall, before 12:00
noon (New York, New York time) on the date of such Borrowing, make available for
the account of its Applicable Lending Office to the Administrative Agent at its
address referred to in Section 10.02, or such other location as the
Administrative Agent may specify by notice to the Lenders, in same day funds,
such Lender’s Revolving Share or Term Share, as applicable, of such Borrowing.
After the Administrative Agent’s receipt of such funds and upon fulfillment of
the applicable conditions set forth in Article III, the Administrative Agent
will make such funds available to the Borrower at its account with the
Administrative Agent.

(ii) Notwithstanding the foregoing, the Borrower may for Adjusted Base Rate
Advances requested on the Effective Date only request that such Advances be made
on the same day as the Notice of Borrowing, provided that such Notice of
Borrowing shall be given not later than 9:00 a.m. (New York, New York time) on
the Effective Date. If such Notice of Borrowing on the Effective Date is
delivered to the Administrative Agent by such time, (A) the Administrative Agent
will promptly notify each Lender who is obligated to fund an Advance under such
Notice of Borrowing of such Notice of Borrowing not later than 12:00 noon (New
York, New York time) on the Effective Date and (B) each Lender shall, before
3:00 p.m. (New York, New York time) on the Effective Date, make available for
the account of its Applicable Lending Office to the Administrative Agent at its
address referred to in Section 10.02, or such other location as the
Administrative Agent may specify by notice to the Lenders, in same day funds,
such Lender’s Revolving Share or Term Share, as applicable, of such Borrowing.

(b) Conversions and Continuations. In order to elect to Convert or continue
Advances comprising part of the same Borrowing under this Section, the Borrower
shall deliver an irrevocable Notice of Conversion or Continuation to the
Administrative Agent at the Administrative Agent’s office no later than 12:00
noon (New York, New York time) (i) on the date which is at least three
(3) Business Days in advance of the proposed Conversion or continuation date in
the case of a Conversion to or a continuation of a Borrowing comprised of
Eurodollar Rate Advances and (ii) on the Business Day prior to the proposed
conversion date in the case of a Conversion to a Borrowing comprised of Adjusted
Base Rate Advances. Each such Notice of Conversion or Continuation shall be in
writing or by telecopier, specifying (i) the requested Conversion or
continuation date (which shall be a Business Day), (ii) the Borrowing amount,
Type and Class of the Advances to be Converted or continued, (iii) whether a
Conversion or continuation is requested, and if a Conversion, into what Type of
Advances, and (iv) in the case of a Conversion to, or a continuation of,
Eurodollar Rate Advances, the requested Interest Period. Promptly after receipt
of a Notice of Conversion or Continuation under this paragraph, the
Administrative Agent shall provide each Lender with a copy thereof and, in the
case of a Conversion to or a continuation of Eurodollar Rate Advances, notify
each Lender of the applicable interest rate under Section 2.06(b). If the
Borrower shall fail to specify an Interest Period for a Eurodollar Rate Advance
including the continuation of a Eurodollar Rate Advance, the Borrower shall be
deemed to have selected an Adjusted Base Rate Advance.

(c) Certain Limitations. Notwithstanding anything in paragraphs (a) and (b)
above:

(i) in the case of Eurodollar Rate Advances each Borrowing shall be in an
aggregate amount of not less than $1,000,000 or greater multiples of $100,000;

(ii) in the case of Adjusted Base Rate Advances each Borrowing shall be in an
aggregate amount of not less than $500,000 or greater multiples of $100,000;

(iii) except for Borrowings for the acquisition of Permitted New Investments by
the Borrower or its Subsidiary, the Borrower may not request Borrowings on more
than four (4) days in any calendar month;

(iv) at no time shall there be more than five (5) Interest Periods applicable to
outstanding Eurodollar Rate Advances;

(v) the Borrower may not select Eurodollar Rate Advances for any Borrowing to be
made, Converted or continued if a Default has occurred and is continuing;

(vi) if any Lender shall, at any time prior to the making of any requested
Borrowing comprised of Eurodollar Rate Advances, notify the Administrative Agent
that the introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or that any central bank or other governmental
authority asserts that it is unlawful, for such Lender or its Applicable Lending
Office to perform its obligations under this Agreement to make Eurodollar Rate
Advances or to fund or maintain Eurodollar Rate Advances, then such Lender’s
Revolving Share or Term Share, as applicable, of such Borrowing shall be made as
an Adjusted Base Rate Advance, provided that such Adjusted Base Rate Advance
shall be considered part of the same Borrowing and interest on such Adjusted
Base Rate Advance shall be due and payable at the same time that interest on the
Eurodollar Rate Advances comprising the remainder of such Borrowing shall be due
and payable; and such Lender agrees to use commercially reasonable efforts
(consistent with its internal policies and legal and regulatory restrictions) to
designate a different Applicable Lending Office if the making of such
designation would avoid the effect of this paragraph and would not, in the
reasonable judgment of such Lender, be otherwise materially disadvantageous to
such Lender;

(vii) if the Administrative Agent is unable to determine the applicable
Eurodollar Rate for Eurodollar Rate Advances comprising any requested Borrowing,
the right of the Borrower to select Eurodollar Rate Advances for such Borrowing
or for any subsequent Borrowing shall be suspended until the Administrative
Agent shall notify the Borrower and the Lenders that the circumstances causing
such suspension no longer exist, and each Advance comprising such Borrowing
shall be an Adjusted Base Rate Advance;

(viii) if the Required Lenders shall, at least one Business Day before the date
of any requested Borrowing, notify the Administrative Agent that the Applicable
Eurodollar Rate for Eurodollar Rate Advances comprising such Borrowing will not
adequately reflect the cost to such Lenders of making or funding their
respective Eurodollar Rate Advances, as the case may be, for such Borrowing, the
right of the Borrower to select Eurodollar Rate Advances for such Borrowing or
for any subsequent Borrowing shall be suspended until the Administrative Agent
shall notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist, and each Advance comprising such Borrowing shall be
an Adjusted Base Rate Advance;

(ix) if the Borrower shall fail to select the duration or continuation of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of “Interest Period” in Section 1.01 and
paragraph (a) or (b) above, the Administrative Agent will forthwith so notify
the Borrower and the Lenders and such Advances will be made available to the
Borrower on the date of such Borrowing as Adjusted Base Rate Advances or, if an
existing Advance, Converted into Adjusted Base Rate Advances; and

(x) the Borrower may not select Eurodollar Rate Advances prior to the 5th
Business Day following the Effective Date.

(d) Notices Irrevocable. Each Notice of Borrowing and Notice of Conversion or
Continuation shall be irrevocable and binding on the Borrower. In the case of
any Borrowing which the related Notice of Borrowing specifies is to be comprised
of Eurodollar Rate Advances, the Borrower shall indemnify each Lender against
any loss, out-of-pocket cost or expense incurred by such Lender as a result of
any condition precedent for Borrowing set forth in Article III not being
satisfied for any reason, including, without limitation, any loss, cost or
expense actually incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund the Advance to be made
by such Lender as part of such Borrowing when such Advance, as a result of such
failure, is not made on such date.

(e) Administrative Agent Reliance. Unless the Administrative Agent shall have
received notice from a Lender before the date of any Borrowing that such Lender
will not make available to the Administrative Agent such Lender’s Revolving
Share or Term Share, as applicable, of the Borrowing, the Administrative Agent
may assume that such Lender has made its Revolving Share or Term Share, as
applicable, of such Borrowing available to the Administrative Agent on the date
of such Borrowing in accordance with paragraph (a) of this Section 2.02 and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that such
Lender shall not have so made its Revolving Share or Term Share, as applicable,
of such Borrowing available to the Administrative Agent, such Lender and the
Borrower severally agree to immediately repay to the Administrative Agent on
demand such corresponding amount, together with interest on such amount, for
each day from the date such amount is made available to the Borrower until the
date such amount is repaid to the Administrative Agent, at (i) in the case of
the Borrower, the interest rate applicable on each such day to Advances
comprising such Borrowing and (ii) in the case of such Lender, the Federal Funds
Rate for each such day. If such Lender shall repay to the Administrative Agent
such corresponding amount and interest as provided above, such corresponding
amount so repaid shall constitute such Lender’s Advance as part of such
Borrowing for purposes of this Agreement even though not made on the same day as
the other Advances comprising such Borrowing.

(f) Lender Obligations Several. The failure of any Lender to make the Advance to
be made by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, to make its Advance on the date of such Borrowing. No Lender
shall be responsible for the failure of any other Lender to make the Advance to
be made by such other Lender on the date of any Borrowing.

(g) Notes. The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will promptly execute and deliver to such
Lender a promissory note of the Borrower evidencing any Revolving Advances or
Term Advances, as the case may be, of such Lender, substantially in the forms of
Exhibit A-1, or A-2, as the case may be, with appropriate insertions as to date
and principal amount; provided, that delivery of Notes shall not be a condition
precedent to the occurrence of the Effective Date or the making of Advances.

Section 2.03 Fees.

(a) Commitment Fees. For the period from the Closing Date until the Revolving
Maturity Date the Borrower agrees to pay to the Administrative Agent for the
account of each Lender a commitment fee on the average daily amount by which
such Lender’s Revolving Commitment exceeds the sum of such Lender’s Revolving
Share of the Revolving Exposure at a rate per annum equal to the Commitment Fee
Rate (computed on the actual number of days elapsed, including the first day and
excluding the last, based upon a 360-day year). Such fees shall be due and
payable quarterly in arrears (i) on the date which is thirty (30) days following
the end of the last Business Day of each March, June, September and December and
(ii) on the Revolving Maturity Date.

(b) Letter of Credit Fees. The Borrower agrees to pay to the Administrative
Agent for the benefit of the Lenders, fees in respect of all Letters of Credit
outstanding at a rate per annum equal to the Applicable Margin (computed on the
actual number of days elapsed, including the first day and excluding the last,
based upon a 360-day year) on the average daily amount of the aggregate undrawn
maximum amount of each Letter of Credit outstanding, payable in arrears (i) on
the date which is thirty (30) days following the last Business Day of each
March, June, September and December and (ii) on the Revolving Maturity Date. In
addition, the Borrower agrees to pay to the Issuing Bank for its own account a
fee on the average daily amount of the aggregate undrawn maximum face amount of
each Letter of Credit issued by such Issuing Bank at a rate per annum equal to
one-quarter of one percent (.25%), such fees due and payable quarterly in
arrears (i) on the date which is thirty (30) days following the last Business
Day of each March, June, September and December and (ii) on the Maturity Date.

(c) Administrative Agent’s Fees. The Borrower agrees to pay to the
Administrative Agent for its benefit the fees set forth in the Fee Letter for
acting as Administrative Agent, as and when the same are due and payable
pursuant to the terms of the Fee Letter.

Section 2.04 Reduction of the Revolving Commitments. The Borrower may, upon at
least three (3) Business Days’ prior notice to the Administrative Agent,
permanently terminate in whole or permanently reduce ratably in part the
Revolving Commitments of the Lenders; provided, however, that (a) each partial
reduction shall be in the aggregate amount of not less than $5,000,000 or an
integral multiple of $1,000,000 in excess thereof, (b) no such reduction shall
result in an overdraft status as provided in Section 2.07(c)(iv), and (c) no
such reduction shall result in the total aggregate Revolving Commitments of the
Lenders being less than $25,000,000 unless the total aggregate Revolving
Commitments are permanently terminated in their entirety.

Section 2.05 Repayment of Advances on Maturity Date. The Borrower shall repay
the outstanding principal amount of each Advance on the applicable Maturity Date
for such Class of Advance.

Section 2.06 Interest, Late Payment Fee. The Borrower shall pay interest on the
unpaid principal amount of each Advance made by each Lender from the date of
such Advance until such principal amount shall be paid in full, at the following
rates per annum:

(a) Adjusted Base Rate Advances. If such Advance is an Adjusted Base Rate
Advance, a rate per annum (computed on the actual number of days elapsed,
including the first day and excluding the last, based on a 365 day year) equal
at all times to the lesser of (i) the Adjusted Base Rate in effect from time to
time plus the Applicable Margin and (ii) the Maximum Rate, payable in arrears on
the first Business Day of each calendar month and on the date such Adjusted Base
Rate Advance shall be paid in full, provided that during the continuance of an
Event of Default, Adjusted Base Rate Advances shall bear interest at a rate per
annum equal at all times to the lesser of (i) the rate required to be paid on
such Advance had such Event of Default not occurred plus three percent (3%) and
(ii) the Maximum Rate.

(b) Eurodollar Rate Advances. If such Advance is a Eurodollar Rate Advance, a
rate per annum (computed on the actual number of days elapsed, including the
first day and excluding the last, based on a 360 day year) equal at all times
during the Interest Period for such Advance to the lesser of (i) the applicable
Eurodollar Rate for such Advance for such Interest Period plus the Applicable
Margin and (ii) the Maximum Rate, payable in arrears on the last day of such
Interest Period, and on the date such Eurodollar Rate Advance shall be paid in
full, and, with respect to Eurodollar Rate Advances having an Interest Period in
excess of thirty (30) days, the first Business Day of each calendar month during
such Interest Period excluding the month in which such Eurodollar Rate Advance
shall be paid in full; provided that during the continuance of an Event of
Default, Eurodollar Rate Advances shall bear interest at a rate per annum equal
at all times to the lesser of (i) the rate required to be paid on such Advance
had such Event of Default not occurred plus three percent (3%) and (ii) the
Maximum Rate.

(c) Usury Recapture. In the event the rate of interest chargeable under this
Agreement or the Notes at any time is greater than the Maximum Rate, the unpaid
principal amount of the Notes shall bear interest at the Maximum Rate until the
total amount of interest paid or accrued on the Notes equals the amount of
interest which would have been paid or accrued on the Notes if the stated rates
of interest set forth in this Agreement had at all times been in effect. In the
event, upon payment in full of the Notes, the total amount of interest paid or
accrued under the terms of this Agreement and the Notes is less than the total
amount of interest which would have been paid or accrued if the rates of
interest set forth in this Agreement had, at all times, been in effect, then the
Borrower shall, to the extent permitted by applicable law, pay the
Administrative Agent for the account of the Lenders an amount equal to the
difference between (i) the lesser of (A) the amount of interest which would have
been charged on the Notes if the Maximum Rate had, at all times, been in effect
and (B) the amount of interest which would have accrued on the Notes if the
rates of interest set forth in this Agreement had at all times been in effect
and (ii) the amount of interest actually paid or accrued under this Agreement on
the Notes. In the event the Lenders ever receive, collect or apply as interest
any sum in excess of the Maximum Rate, such excess amount shall, to the extent
permitted by law, be applied to the reduction of the principal balance of the
Notes, and if no such principal is then outstanding, such excess or part thereof
remaining shall be paid to the Borrower.

(d) Other Amounts Overdue. Subject to the provisions of Section 10.11, if any
amount payable under this Agreement other than the Advances is not paid when due
and payable, including without limitation, accrued interest and fees, then such
overdue amount shall accrue interest hereon due and payable on demand at a rate
per annum equal to the Adjusted Base Rate plus three percent (3%), from the date
such amount became due until the date such amount is paid in full.

(e) Late Payment Fee. Subject to the provisions of Section 10.11, if any
interest payable under this Agreement is not paid when due and payable (after
taking into account any applicable grace period), then the Borrower will pay to
the Lenders contemporaneously with the payment of such past due interest a late
payment fee equal to an amount equal to the product of (i) such overdue interest
times (ii) four percent (4%).

Section 2.07 Prepayments.

(a) Right to Prepay. The Borrower shall have no right to prepay any principal
amount of any Advance except as provided in this Section 2.07.

(b) Optional Prepayments. The Borrower may elect to prepay any of the Advances,
after giving by 12:00 noon (New York, New York time) (i) in the case of
Eurodollar Rate Advances, at least three (3) Business Days’, or (ii) in case of
Adjusted Base Rate Advances, at least one (1) Business Day’s prior written
notice to the Administrative Agent, stating the proposed date and aggregate
principal amount of such prepayment, and if applicable, the relevant Interest
Period for the Advances to be prepaid. If any such notice is given, the Borrower
shall prepay Advances comprising part of the same Borrowing in whole or ratably
in part in an aggregate principal amount equal to the amount specified in such
notice, and shall also pay accrued interest to the date of such prepayment on
the principal amount prepaid and amounts, if any, required to be paid pursuant
to Sections 2.07(c)(iii) or 2.08 as a result of such prepayment being made on
such date; provided, however, that each partial prepayment shall be in an
aggregate principal amount not less than $500,000 and in integral multiples of
$100,000.

(c) Mandatory Prepayments.

(i) Repayment Event. Upon the occurrence of any Repayment Event, the Borrower
shall prepay Advances on the Business Day the Net Cash Proceeds from such
Repayment Event are received by the Borrower or the Parent, as applicable, in an
amount equal to the lesser of (A) the amount of the outstanding Advances on such
Business Day and (B) the Repayment Amount for such Repayment Event. If, in
connection with an Asset Disposition which qualifies as a Repayment Event for
which the Borrower has not used the Net Cash Proceeds to repay the Obligations,
the Borrower has failed to make a Permitted New Investment or Permitted New
Investments with such Net Cash Proceeds by the end of the Rolling Period
commencing after the Fiscal Quarter in which such Asset Disposition occurred,
then the Borrower shall prepay Advances on or prior to the end of such Rolling
Period, in the amount equal to the lesser of (A) the amount of the outstanding
Advances on such date and (B) the portion of the Repayment Amount for such
Repayment Event which has not been used to make a Permitted Investment or
Permitted Investments.

(ii) Allocation of Payments. Prepayments under the foregoing paragraph (i) shall
be applied (A) first, to Term Advances in the reverse order of maturity, and
(B) second, to Revolving Advances. Notwithstanding the foregoing, any holder of
Term Advances may, at its sole discretion, so long as any Revolving Advances are
then outstanding (after giving effect to the application of the required
prepayment to the Term Advances and Revolving Advances under this
Section 2.07(c)), elect by written notice provided to the Administrative Agent
not to have all or any amount of any such required prepayments applied to such
holder’s Term Advances, in which case the aggregate amount so declined shall be
applied to Revolving Advances; provided, however, that to the extent that the
aggregate amount so declined by the holders of the Term Advances exceeds the
aggregate principal amount of the Revolving Advances, the excess shall be
allocated between the declining holders of the Term Advances pro rata based on
the aggregate amount declined by each such holder

(iii) Term Advances. Commencing on April 1, 2005 and on each July 1, October 1,
January 1 and April 1 thereafter, the Borrower shall repay the Term Advances by
an amount equal to $1,250,000. In addition, except for the repayment made
pursuant to the preceding sentence or a repayment or prepayment in connection
with the replacement of a Lender contemplated by Section 2.15, if any Term
Advances are prepaid or repaid prior to the second anniversary of the Closing
Date, then in addition to such prepayment of Term Advances the Borrower shall
pay to the Administrative Agent for the account of each Lender an amount equal
to (A) the amount of such Lender’s Term Advances so prepaid times (B) a
percentage equal to (1) if prior to the first anniversary of the Closing Date,
then 2%, and (2) if on or after the first anniversary of the Closing Date, but
before the second anniversary of the Closing Date, then 1%. The Borrower
acknowledges and agrees that the amount payable by it in connection with the
prepayment of Term Advances is a reasonable calculation of the Lenders’ damages
in view of the difficulties and impracticability of determining actual damages
resulting from the prepayment of Term Advances.

(iv) Overdraft. On any date on which the Revolving Exposure exceeds the
aggregate Revolving Commitments, the Borrower agrees to make a prepayment of the
Revolving Advances in the amount of such excess, and if all the Revolving
Advances have been then repaid, then to deposit with the Administrative Agent
into the Cash Collateral Account an amount equal to the lesser of (A) the Letter
of Credit Exposure or (B) the amount of such excess less the amount of Revolving
Advances then repaid.

(v) Accrued Interest. Each prepayment pursuant to this Section 2.07(c) shall be
accompanied by accrued interest on the amount prepaid to the date of such
prepayment and amounts, if any, required to be paid pursuant to Section 2.08 as
a result of such prepayment being made on such date.

(vi) Avoidance of Breakage Costs. In the event that the amount of any mandatory
prepayment of Advances under this Section 2.07(c) exceeds the aggregate
principal amount of Advances which consist of Adjusted Base Rate Advances (the
amount of such excess being the “Excess Amount”), the Borrower shall have the
right, in lieu of making such prepayment in full, to prepay such outstanding
Advances which are Adjusted Base Rate Advances and to deposit an amount equal to
the Excess Amount with the Administrative Agent in the Cash Collateral Account
maintained by and in the sole dominion and control of the Administrative Agent
for the ratable benefit of the Lenders. Any amount so deposited shall be held by
the Administrative Agent as collateral for the Obligations, earn interest on
behalf of the Borrower and be applied to the prepayment of Advances which are
Eurodollar Rate Advances at the end of the current Interest Period(s) applicable
thereto. On any day on which amounts collected in the Cash Collateral Account
remain on deposit in or to the credit of the Cash Collateral Account after
giving effect to the payment made on such day pursuant to this Section 2.07(c),
and the Borrower shall have delivered to the Administrative Agent a written
request or a telephonic request (which shall be promptly confirmed in writing)
prior to 12:00 noon (New York, New York time) that such remaining collected
amounts be invested in cash equivalents specified in such request, the
Administrative Agent shall invest such funds, to the extent the Administrative
Agent is reasonably able to do so, in such cash equivalents as are acceptable
to, and with no risk to, the Administrative Agent on an overnight basis or with
maturities such that amounts will be available to pay the Obligations secured
thereby as they become due, whether at maturity, by acceleration or otherwise;
provided, however, that any loss resulting from such investments shall be
charged to and be immediately payable by the Borrower on demand by the
Administrative Agent.

(vii) Repayment of Revolving Advances. Any mandatory repayments of Revolving
Advances pursuant to this Section 2.07(c) shall be applied (A) if no Default or
Event of Default exists, then to Revolving Advances comprising the same
Borrowing or Borrowings, at the Borrower’s option, and (B) if a Default or Event
of Default exists, then to all Revolving Advances pro rata based upon the amount
of outstanding Revolving Advances.

(d) Ratable Payments. Each payment of any Advance pursuant to this Section 2.07
or any other provision of this Agreement shall be made in a manner such that all
Advances comprising part of the same Borrowing are paid in whole or ratably in
part.

(e) Effect of Notice. All notices given pursuant to this Section 2.07 shall be
irrevocable and binding upon the Borrower.

(f) Payments with respect to Liens on an Owned Hospitality Property.
Notwithstanding anything in this Agreement or any other Credit Document to the
contrary, except in connection with the release of Liens on an Owned Hospitality
Property contemplated by the provisions of Section 5.09, each payment of any
Advance pursuant to this Section 2.07 or any other provision of this Agreement
shall be made in a manner such that all Advances secured by a Lien on an Owned
Hospitality Property shall be deemed the last Advances repaid.

Section 2.08 Breakage Costs. If (a) any payment of principal of any Eurodollar
Rate Advance is made other than on the last day of the Interest Period for such
Advance as a result of any payment pursuant to Section 2.07 or the acceleration
of the maturity of the Notes pursuant to Article VIII or otherwise; (b) any
Conversion of a Eurodollar Rate Advance is made other than on the last day of
the Interest Period for such Advance pursuant to Section 2.02(b) or Section 2.12
or otherwise; or (c) the Borrower fails to make a principal or interest payment
with respect to any Eurodollar Rate Advance on the date such payment is due and
payable, the Borrower shall, within ten (10) days of any written demand sent by
any Lender to the Borrower through the Administrative Agent, pay to the
Administrative Agent for the account of such Lender any amounts (without
duplication of any other amounts payable in respect of breakage costs) required
to compensate such Lender for any additional losses, out-of-pocket costs or
expenses which it may reasonably incur as a result of such payment or
nonpayment, including, without limitation, any loss, cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired by
any Lender to fund or maintain such Advance.

Section 2.09 Increased Costs.

(a) Eurodollar Rate Advances. If, due to either (i) the introduction of or any
change in or in the interpretation of any law or regulation (except with respect
to Taxes or Other Taxes) following the date of this Agreement or (ii) the
compliance with any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of law) not complied
with prior to the date of this Agreement, there shall be any increase in the
cost to any Lender of agreeing to make or making, funding or maintaining
Eurodollar Rate Advances, then the Borrower shall from time to time, upon demand
by such Lender (with a copy of such demand to the Administrative Agent),
immediately pay to the Administrative Agent for the account of such Lender
additional amounts (without duplication of any other amounts payable in respect
of increased costs) sufficient to compensate such Lender for such increased
cost; provided, however, that, before making any such demand, each Lender agrees
to use commercially reasonable efforts (consistent with its internal policy and
legal and regulatory restrictions) to designate a different Applicable Lending
Office if the making of such a designation would avoid the need for, or reduce
the amount of, such increased cost and would not, in the reasonable judgment of
such Lender, be otherwise disadvantageous to such Lender. A certificate as to
the amount of such increased cost and detailing the calculation of such cost
submitted to the Borrower and the Administrative Agent by such Lender at the
time such Lender demands payment under this Section shall be conclusive and
binding for all purposes, absent manifest error.

(b) Capital Adequacy. If any Lender or the Issuing Bank determines in good faith
that compliance with any law or regulation or any guideline or request from any
central bank or other Governmental Authority (whether or not having the force of
law) implemented or effective after the date of this Agreement affects or would
affect the amount of capital required or expected to be maintained by such
Lender or the Issuing Bank and that the amount of such capital is increased by
or based upon the existence of such Lender’s commitment to lend or the Issuing
Bank’s commitment to issue Letters of Credit or any Lender’s commitment to risk
participate in Letters of Credit and other commitments of this type, then, upon
thirty (30) days prior written notice by such Lender or the Issuing Bank (with a
copy of any such demand to the Administrative Agent), the Borrower shall
immediately pay to the Administrative Agent for the account of such Lender or to
the Issuing Bank, as the case may be, from time to time as specified by such
Lender or the Issuing Bank, additional amounts (without duplication of any other
amounts payable in respect of increased costs) sufficient to compensate such
Lender or the Issuing Bank, in light of such circumstances, (i) with respect to
such Lender, to the extent that such Lender reasonably determines such increase
in capital to be allocable to the existence of such Lender’s commitment to lend
under this Agreement or its commitment to risk participate in Letters of Credit
and (ii) with respect to the Issuing Bank, to the extent that such Issuing Bank
reasonably determines such increase in capital to be allocable to the issuance
or maintenance of the Letters of Credit. A certificate as to such amounts and
detailing the calculation of such amounts submitted to the Borrower and the
Administrative Agent by such Lender or the Issuing Bank shall be conclusive and
binding for all purposes, absent manifest error.

(c) Letters of Credit. If any change in any law or regulation (except with
respect to Taxes or Other Taxes) or in the interpretation thereof by any court
or administrative or Governmental Authority charged with the administration
thereof following the date of this Agreement shall either (i) impose, modify, or
deem applicable any reserve, special deposit, or similar requirement against
letters of credit issued by, or assets held by, or deposits in or for the
account of, Issuing Bank or any Lender or (ii) impose on Issuing Bank or any
Lender any other condition regarding the provisions of this Agreement relating
to the Letters of Credit or any Letter of Credit Obligations, and the result of
any event referred to in the preceding clause (i) or (ii) shall be to increase
the cost to Issuing Bank of issuing or maintaining any Letter of Credit, or
increase the cost to such Lender of its risk participation in any Letter of
Credit (which increase in cost shall be determined by Issuing Bank’s or such
Lender’s reasonable allocation of the aggregate of such cost increases resulting
from such event), then, upon demand by Issuing Bank or such Lender (with a copy
sent to the Administrative Agent), as the case may be, the Borrower shall pay to
the Administrative Agent for the account of Issuing Bank or Lender, as the case
may be, from time to time as specified by Issuing Bank or such Lender,
additional amounts which shall be sufficient to compensate such Issuing Bank or
such Lender for such increased cost. Issuing Bank and each Lender agrees to use
commercially reasonable efforts (consistent with internal policy and legal and
regulatory restrictions) to designate a different Applicable Lending Office for
the booking of its Letters of Credit or risk participations if the making of
such designation would avoid the effect of this paragraph and would not, in the
reasonable judgment of Issuing Bank or such Lender, be otherwise disadvantageous
to Issuing Bank or such Lender, as the case may be. A certificate as to such
increased cost incurred by Issuing Bank or such Lender, as the case may be, as a
result of any event mentioned in clause (i) or (ii) above, and detailing the
calculation of such increased costs submitted by Issuing Bank or such Lender to
the Borrower and the Administrative Agent, shall be conclusive and binding for
all purposes, absent manifest error.

Section 2.10 Payments and Computations.

(a) Payment Procedures. Except if otherwise set forth herein, the Borrower shall
make each payment under this Agreement and under the Notes not later than 12:00
noon (New York, New York time) on the day when due in Dollars to the
Administrative Agent at the location referred to in the Notes (or such other
location as the Administrative Agent shall designate in writing to the Borrower)
in same day funds without set-off, deduction or counterclaim. Except for amounts
payable solely to the Administrative Agent, the Issuing Banks, or a specific
Lender pursuant to Section 2.03(b), 2.03(c), 2.08, 2.09, 2.11, 2.12, or 2.13(c)
but after taking into account payments effected pursuant to Section 10.04, the
Administrative Agent will on the same day cause to be distributed like funds
relating to the payment of principal, interest or fees ratably to the Lenders in
accordance with, in the case of a payment made in respect of a Borrowing, each
Lender’s Revolving Share or Term Share, as applicable, for the account of their
respective Applicable Lending Offices, and like funds relating to the payment of
any other amount payable to any Lender or Issuing Bank for the account of its
Applicable Lending Office, in each case to be applied in accordance with the
terms of this Agreement.

(b) Computations. All computations of interest based on the Adjusted Base Rate
shall be made by the Administrative Agent on the basis of a year of 365 days and
all computations of fees and interest based on the Applicable Eurodollar Rate
and the Federal Funds Rate shall be made by the Administrative Agent on the
basis of a year of 360 days, in each case for the actual number of days
(including the first day, but excluding the last day) occurring in the period
for which such interest or fees are payable. Each determination by the
Administrative Agent of an interest rate shall be conclusive and binding for all
purposes, absent manifest error.

(c) Non-Business Day Payments. Whenever any payment shall be stated to be due on
a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or fees, as the case may be;
provided, however, that if such extension would cause payment of interest on or
principal of Eurodollar Rate Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.

(d) Administrative Agent Reliance. Unless the Administrative Agent shall have
received written notice from the Borrower prior to the date on which any payment
is due to the Lenders that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
date an amount equal to the amount then due such Lender. If and to the extent
the Borrower shall not have so made such payment in full to the Administrative
Agent, each Lender shall repay to the Administrative Agent forthwith on demand
such amount distributed to such Lender, together with interest, for each day
from the date such amount is distributed to such Lender until the date such
Lender repays such amount to the Administrative Agent, at the Federal Funds Rate
for each such day.

(e) Application of Payments. Unless otherwise specified in Section 2.07 hereof,
whenever any payment received by the Administrative Agent under this Agreement
is insufficient to pay in full all amounts then due and payable under this
Agreement and the Notes, such payment shall be distributed and applied by the
Administrative Agent and the Lenders in the following order: first, to the
payment of fees and expenses due and payable to the Administrative Agent, in its
capacity as such, under and in connection with this Agreement or any other
Credit Document; second, to the payment of all expenses due and payable under
Section 2.11(c), to all fees due and payable to the Issuing Bank pursuant to
Section 2.03(b), and to all other fees due and payable under Section 2.03,
ratably among the Lenders and the Issuing Bank in accordance with the aggregate
amount of such payments owed to each such Lender and the Issuing Bank; third, to
the payment of the interest accrued on all Advances and all Letter of Credit
Obligations, regardless of whether any such amount is then due and payable,
ratably among the Lenders in accordance with the aggregate accrued interest owed
to such Lenders; and fourth, to the payment of the principal amount of all
Advances and all Letter of Credit Obligations, regardless of whether any such
amount is then due and payable, ratably among the Lenders in accordance with the
aggregate principal amount owed to such Lenders.

(f) Register. The Administrative Agent shall record in the Register the
Commitment and the Advances from time to time of each Lender and each repayment
or prepayment in respect to the principal amount of such Advances of each
Lender. Any such recordation shall be conclusive and binding on the Borrower and
each Lender, absent manifest error; provided however, that failure to make any
such recordation, or any error in such recordation, shall not affect the
Borrower’s obligations hereunder in respect of such Advances.

Section 2.11 Taxes.

(a) No Deduction for Certain Taxes. Any and all payments by the Borrower shall
be made, in accordance with Section 2.10, free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding,
(i) in the case of each Lender, Issuing Bank, and the Administrative Agent,
taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction under the laws of which such Lender, Issuing Bank, or the
Administrative Agent (as the case may be) is organized or carries on business
(other than as a result of a connection arising primarily from the Lender,
Issuing Bank, or the Administrative Agent (as the case may be) having executed,
delivered or performed its obligations or received a payment under, or enforced,
this Agreement) or any political subdivision or taxing authority of such
jurisdictions (all such nonexcluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as “Taxes”) and,
(ii) in the case of each Lender and Issuing Bank, Taxes by the jurisdiction of
such Lender’s Applicable Lending Office or any political subdivision of such
jurisdiction. If the Borrower shall be required by law to deduct any Taxes from
or in respect of any sum payable to any Lender, Issuing Bank, or the
Administrative Agent, (i) the sum payable shall be increased as may be necessary
so that, after making all required deductions (including deductions applicable
to additional sums payable under this Section 2.11), such Lender, Issuing Bank,
or the Administrative Agent (as the case may be) receives an amount equal to the
sum it would have received had no such deductions been made; provided, however,
that if the Borrower’s obligation to deduct or withhold Taxes is caused solely
by such Lender’s, Issuing Bank’s, or the Administrative Agent’s failure to
provide the forms described in paragraph (e) of this Section 2.11 and such
Lender, Issuing Bank, or the Administrative Agent could have provided such forms
or if such Lender, Issuing Bank, or the Administrative Agent (as the case may
be) fails to comply with Section 2.11(g), no such increase shall be required;
(ii) the Borrower shall make such deductions; and (iii) the Borrower shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable Legal Requirements.

(b) Other Taxes. In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made or from the execution, delivery
or registration of, or otherwise with respect to, this Agreement, the Notes, or
the other Credit Documents (hereinafter referred to as “Other Taxes”).

(c) Indemnification. The Borrower will indemnify each Lender, Issuing Bank, and
the Administrative Agent for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed by any Governmental
Authority on amounts payable under this Section 2.11) paid by such Lender,
Issuing Bank, or the Administrative Agent (as the case may be) and any liability
(including interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
Each payment required to be made by the Borrower in respect of this
indemnification shall be made to the Administrative Agent for the benefit of any
party claiming such indemnification within thirty (30) days from the date the
Borrower receives written demand detailing the calculation of such amounts
therefore from the Administrative Agent on behalf of itself as Administrative
Agent, Issuing Bank, or any such Lender. If any Lender, the Administrative
Agent, or Issuing Bank receives a refund, offset, credit or deduction in respect
of any Taxes or Other Taxes paid by the Borrower under this paragraph (c), such
Lender, the Administrative Agent, or Issuing Bank, as the case may be, shall
promptly pay to the Borrower the Borrower’s share of such refund, offset, credit
or deduction, received by or credited to the Lender, the Administrative Agent,
or Issuing Bank, as the case may be, (reduced by any Taxes imposed on the
Lender, the Administrative Agent, or Issuing Bank, as the case may be, by reason
of the receipt, accrual or payment of such refund, offset, credit or deduction).

(d) Evidence of Tax Payments. The Borrower will pay prior to delinquency all
Taxes and Other Taxes payable in respect of any payment. Within thirty (30) days
after the date of any payment of Taxes, the Borrower will furnish to the
Administrative Agent, at its address referred to in Section 10.02, the original
or a certified copy of a receipt evidencing payment of such Taxes or Other
Taxes.

(e) Foreign Lender Withholding Exemption. Each Lender and Issuing Bank that is
not incorporated under the laws of the United States of America or a state
thereof agrees that it will deliver to the Borrower and the Administrative Agent
on the date of this Agreement or upon the effectiveness of any Assignment and
Acceptance two duly completed copies of the Prescribed Forms, as the case may
be, certifying in each case that such Lender is entitled to receive payments
under this Agreement and the Notes payable to it, without deduction or
withholding of any United States federal income taxes. Each Lender which
delivers to the Borrower and the Administrative Agent a Prescribed Form further
undertakes to deliver to the Borrower and the Administrative Agent on or before
the date that any such form expires or becomes obsolete or after the occurrence
of any event requiring a change in the most recent form previously delivered by
it to the Borrower and the Administrative Agent two further copies of a
replacement Prescribed Form. If an event (including without limitation any
change in treaty, law or regulation) has occurred prior to the date on which any
delivery required by the preceding sentence would otherwise be required which
renders all such forms inapplicable or which would prevent any Lender from duly
completing and delivering any such letter or form with respect to it and such
Lender advises the Borrower and the Administrative Agent that it is not capable
of receiving payments without any deduction or withholding of United States
federal income tax, and in the case of a Prescribed Form establishing an
exemption from, or a reduced rate of, United States backup withholding tax, such
Lender shall not be required to deliver such forms. The Borrower shall withhold
tax at the rate and in the manner required by the laws of the United States with
respect to payments made to a Lender failing to timely provide the Prescribed
Forms.

(f) Nothing in this Section 2.11 shall require any Lender or the Administrative
Agent to make available any of its tax returns (or any other information that it
deems to be confidential or proprietary, in its sole discretion).

(g) If the Issuing Bank or any Lender claims any additional amounts payable
pursuant to this Section 2.11, then such Issuing Bank or Lender (as the case may
be) shall use its reasonable efforts (consistent with its internal policy and
legal and regulatory restrictions) to change the jurisdiction of its Applicable
Lending Office if the making of such a change would avoid the need for, or
reduce the amount of, any such additional amounts that would be payable or may
thereafter accrue and would not be otherwise disadvantageous to such Issuing
Bank or Lender.

(h) If any Governmental Authority asserts that the Administrative Agent did not
properly withhold or backup withhold, as the case may be, any tax or other
amount from payments made to or for the account of any Lender, that Lender shall
indemnify the Administrative Agent therefore, including all penalties and
interest, any taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section, and costs and expenses (including
attorney fees) of the Administrative Agent. The obligation of the Lenders under
this Section shall survive the termination of the Commitments, repayment of all
other Obligations hereunder and the resignation of the Administrative Agent.

Section 2.12 Illegality. If any Lender shall notify the Administrative Agent and
the Borrower that the introduction of or any change in or in the interpretation
of any Legal Requirement makes it unlawful, or that any central bank or other
Governmental Authority asserts that it is unlawful for such Lender or its
Applicable Lending Office to perform its obligations under this Agreement to
maintain any Eurodollar Rate Advances of such Lender then outstanding hereunder,
then, notwithstanding anything herein to the contrary, the Borrower shall, if
demanded by such Lender by notice to the Borrower and the Administrative Agent
no later than 12:00 noon (New York, New York time), (a) if not prohibited by
Legal Requirement to maintain such Eurodollar Rate Advances for the duration of
the Interest Period, on the last day of the Interest Period for each outstanding
Eurodollar Rate Advance of such Lender or (b) if prohibited by Legal Requirement
to maintain such Eurodollar Rate Advances for the duration of the Interest
Period, on the second Business Day following its receipt of such notice from
such Lender, Convert all such affected Eurodollar Rate Advances of such Lender
then outstanding to Adjusted Base Rate Advances, and pay accrued interest on the
principal amount Converted to the date of such Conversion and amounts, if any,
required to be paid pursuant to Section 2.08 as a result of such Conversion
being made on such date. Each Lender agrees to use commercially reasonable
efforts (consistent with its internal policies and legal and regulatory
restrictions) to designate a different Applicable Lending Office if the making
of such designation would avoid the effect of this paragraph and would not, in
the reasonable judgment of such Lender, be otherwise disadvantageous to such
Lender.

Section 2.13 Letters of Credit.

(a) Issuance. From time to time from the date of this Agreement until three
months before the Maturity Date, at the request of the Borrower, the Issuing
Bank shall, on any Business Day and on the terms and conditions hereinafter set
forth, issue, increase, decrease, amend, or extend the expiration date of
Letters of Credit for the account of the Borrower (for its own benefit or for
the benefit of any of its Subsidiaries). Upon the Effective Date, but subject to
the limitations contained in the following sentence, each Existing Letter of
Credit shall be automatically converted to a Letter of Credit. No Letter of
Credit will be issued, increased, or extended and no Existing Letter of Credit
will be converted to a Letter of Credit (i) if such issuance, increase,
extension or conversion would cause the Letter of Credit Exposure to exceed the
lesser of (x) $10,000,000 or (y) an amount equal to (A) the aggregate Revolving
Commitments less (B) the sum of the aggregate Revolving Exposure at such time;
(ii) unless such Letter of Credit has an Expiration Date not later than the
earlier of (A) one year after the date of issuance thereof and (B) ten (10) days
prior to the Maturity Date; (iii) unless such Letter of Credit is in form and
substance acceptable to the Issuing Bank; (iv) unless such Letter of Credit is a
standby letter of credit not supporting the repayment of indebtedness for
borrowed money of any Person; (v) unless the Borrower has delivered to the
Issuing Bank the completed and executed Letter of Credit Documents (other than
the Letter of Credit) on such Issuing Bank’s standard form, which shall contain
terms no more restrictive than the terms of this Agreement; (vi) unless such
Letter of Credit is governed by the International Standby Practices (1998)
(“ISP”) or any successor to the ISP; and (vii) unless no Default has occurred
and is continuing or would result from the issuance of such Letter of Credit. If
the terms of any of the Letter of Credit Documents referred to in the foregoing
clause (v) conflicts with the terms of this Agreement, the terms of this
Agreement shall control.

(b) Participations. On the date of the issuance or increase of any Letter of
Credit on or after the Effective Date or the conversion of any Existing Letter
of Credit to a Letter of Credit in accordance with provisions of the preceding
Section 2.13(a), Issuing Bank shall be deemed to have sold to each other Lender
with a Revolving Commitment and each other Lender with a Revolving Commitment
shall have been deemed to have purchased from such Issuing Bank a participation
in the Letter of Credit Exposure related to the Letters of Credit issued by such
Issuing Bank equal to such Lender’s Revolving Share at such date and such sale
and purchase shall otherwise be in accordance with the terms of this Agreement.
Issuing Bank shall promptly notify each such participant Lender by telex,
telephone, or telecopy of each Letter of Credit of such Issuing Bank issued,
increased or decreased, and the actual dollar amount of such Lender’s
participation in such Letter of Credit. Each Lender’s obligation to purchase
participating interests pursuant to this Section and to reimburse the Issuing
Bank for such Lender’s Revolving Share of any payment under a Letter of Credit
by such Issuing Bank not reimbursed in full by the Borrower shall be absolute
and unconditional and shall not be affected by any circumstance, including,
without limitation, (i) any of the circumstances described in paragraph
(d) below, (ii) the occurrence and continuance of a Default, (iii) an adverse
change in the financial condition of the Borrower or any Guarantor, or (iv) any
other circumstance, happening or event whatsoever, whether or not similar to any
of the foregoing, except for any such circumstance, happening or event that is
determined by a court of competent jurisdiction by a final and non-appealable
judgment to have resulted from the gross negligence or willful misconduct on the
part of such Issuing Bank.

(c) Reimbursement. The Borrower shall have the right (but not the obligation) to
pay promptly on demand to Issuing Bank in respect of each Letter of Credit
issued by such Issuing Bank an amount equal to any amount paid by such Issuing
Bank under or in respect of such Letter of Credit. In the event any Issuing Bank
makes a payment pursuant to a request for draw presented under a Letter of
Credit and such payment is not promptly reimbursed by the Borrower upon demand,
such Issuing Bank shall give notice of such payment to the Administrative Agent
and, upon receipt of such notice, the Administrative Agent shall give notice of
such payment to the Lenders, and each Lender shall promptly reimburse such
Issuing Bank for such Lender’s Revolving Share of such payment, and such
reimbursement shall be deemed for all purposes of this Agreement to constitute
an Adjusted Base Rate Advance to the Borrower from such Lender. If such
reimbursement is not made by any Lender to any Issuing Bank on the same day on
which such Issuing Bank shall have made payment on any such draw, such Lender
shall pay interest thereon to such Issuing Bank for each such day from the date
such payment should have been made until the date repaid at a rate per annum
equal to the Federal Funds Rate for each such day. The Borrower hereby
unconditionally and irrevocably authorizes, empowers, and directs the
Administrative Agent and the Lenders to record and otherwise treat each payment
under a Letter of Credit not immediately reimbursed by the Borrower as a
Borrowing comprised of Adjusted Base Rate Advances to the Borrower.

(d) Obligations Unconditional. The obligations of the Borrower under this
Agreement in respect of each Letter of Credit shall be absolute, unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, notwithstanding the following circumstances:

(i) any lack of validity or enforceability of any Letter of Credit Documents;

(ii) any amendment or waiver of or any consent to departure from any Letter of
Credit Documents;

(iii) the existence of any claim, set-off, defense or other right which the
Borrower or any Lender or any other Person may have at any time against any
beneficiary or transferee of such Letter of Credit (or any Persons for whom any
such beneficiary or any such transferee may be acting), the Issuing Bank or any
other Person or entity, whether in connection with this Agreement, the
transactions contemplated in this Agreement or in any Letter of Credit Documents
or any unrelated transaction;

(iv) any statement or any other document presented under such Letter of Credit
proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect to the extent the
Issuing Bank would not be liable therefore pursuant to the following paragraph
(e);

(v) payment by the Issuing Bank under such Letter of Credit against presentation
of a draft or certificate which does not comply with the terms of such Letter of
Credit; or

(vi) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing.

(e) Liability of Issuing Banks. The Borrower assumes all risks of the acts or
omissions of any beneficiary or transferee of any Letter of Credit with respect
to its use of such Letter of Credit. No Issuing Bank, nor any other Lender, nor
any of their respective officers or directors shall be liable or responsible
for:

(i) the use which may be made of any Letter of Credit or any acts or omissions
of any beneficiary or transferee in connection therewith;

(ii) the validity, sufficiency or genuineness of documents, or of any
endorsement thereon, even if such documents should prove to be in any or all
respects invalid, insufficient, fraudulent or forged;

(iii) payment by such Issuing Bank against presentation of documents which do
not comply with the terms of a Letter of Credit, including failure of any
documents to bear any reference or adequate reference to the relevant Letter of
Credit; or

(iv) any other circumstances whatsoever in making or failing to make payment
under any Letter of Credit (including such Issuing Bank’s own negligence),

except that the Borrower shall have a claim against such Issuing Bank, and such
Issuing Bank shall be liable to, and shall promptly pay to, the Borrower, to the
extent of any direct, as opposed to consequential, damages suffered by the
Borrower that are determined by a court of competent jurisdiction by a final and
non-appealable judgment to have resulted from (A) such Issuing Bank’s willful
misconduct or gross negligence in determining whether documents presented under
a Letter of Credit comply with the terms of such Letter of Credit or (B) such
Issuing Bank’s gross negligence in failing to make lawful payment under any
Letter of Credit after the presentation to it of a draft and certificate
strictly complying with the terms and conditions of such Letter of Credit. In
furtherance and not in limitation of the foregoing, any Issuing Bank may accept
documents that appear on their face to be in order, without responsibility for
further investigation.

Section 2.14 Determination of Leverage Ratio. In addition to the determination
of the Leverage Ratio in a Compliance Certificate, the Leverage Ratio shall be
determined by the Administrative Agent, as follows:

(a) Adjustments. Following each making, acquisition or disposition by the Parent
or its Subsidiary of an Investment or any Non-Replaced Property with an
Investment Amount in excess of $5,000,000 or the incurrence by the Parent or its
Subsidiary of additional Indebtedness (excluding any Obligations) in excess of
$5,000,000 (an “Adjustment Event”), and the Administrative Agent’s receipt of an
Adjustment Report with respect thereto, the Administrative Agent shall adjust
the Leverage Ratio accordingly.

(b) Notice of Leverage Ratio Change. Promptly following any date the Leverage
Ratio is determined in accordance with the preceding paragraph, the
Administrative Agent shall give notice to the Lenders and the Borrower of the
new Leverage Ratio.

Section 2.15 Lender Replacement.

(a) Right to Replace. The Borrower shall have the right to replace each Lender
affected by a condition under Section 2.02(c)(vi), 2.09, 2.11, or 2.12 for more
than 60 days (each such affected Lender, an “Affected Lender”) in accordance
with the procedures in this Section 2.15 and provided that no reduction of the
total Commitments occurs as a result thereof.

(b) Replacement Allocation.

(i) Upon the occurrence of any condition permitting the replacement of a Lender,
the Administrative Agent in its sole discretion shall have the right to
reallocate the amount of the Commitments of the Affected Lenders, including
without limitation to Persons which are not already party to this Agreement but
which qualify as Eligible Assignees, which election shall be made by written
notice within thirty (30) days after the date such condition occurs.

(ii) If the aggregate amount of the reallocated Commitments is less than the
Commitments of the Affected Lenders, (A) the respective Commitments of the
Lenders which have received such reallocated Commitments shall be increased by
the respective amounts of their proposed reallocations, and (B) the Borrower
shall have the right to add additional Lenders which are Eligible Assignees to
this Agreement to replace such Affected Lenders, which additional Lenders would
have aggregate Commitments no greater than those of the Affected Lenders minus
the amounts of the Commitments already reallocated.

(iii) Notwithstanding any provision in this Section 2.15 to the contrary, no
Lender may have such Lender’s Commitment increased pursuant to the provisions of
this Section 2.15 without such Lender’s written consent.

(c) Procedure. Any assumptions of Commitments pursuant to this Section 2.15
shall be (i) made by the purchasing Lender or Eligible Assignee and the selling
Lender entering into an Assignment and Assumption and by following the
procedures in Section 10.06 for adding a Lender; provided that no processing fee
shall be charged by the Administrative Agent in connection with such assignment.
In connection with the reallocation of the Commitments of any Lender pursuant to
the foregoing paragraph (b), each Lender with a reallocated Commitment shall
purchase from the Affected Lenders at par such Lender’s Revolving Share or Term
Share, as applicable, of the outstanding Advances of the Affected Lenders and
assume such Lender’s Revolving Share of the Affected Lenders’ Letter of Credit
Exposure.

Section 2.16 Sharing of Payments, Etc. If any Lender shall obtain any payment
(whether voluntary, involuntary, through the exercise of any right of set-off or
otherwise) on account of the Advances made by it in excess of its Revolving
Share or Term Share, as applicable, of payments or collateral on account of the
Advances or Letter of Credit Obligations obtained by all the Lenders, such
Lender shall notify the Administrative Agent and forthwith purchase from the
other Lenders such participations in the Advances, as applicable, made by them
or Letter of Credit Obligations held by them as shall be necessary to cause such
purchasing Lender to share the excess payment or benefits of such collateral or
proceeds ratably in accordance with the requirements of this Agreement with each
of them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and such Lender shall repay to the purchasing Lender the
purchase price to the extent of such Lender’s ratable share (according to the
proportion of (a) the amount of the participation sold by such Lender to the
purchasing Lender as a result of such excess payment to (b) the total amount of
such excess payment) of such recovery, together with an amount equal to such
Lender’s ratable share (according to the proportion of (a) the amount of such
Lender’s required repayment to the purchasing Lender to (b) the total amount of
all such required repayments to the purchasing Lender) of any interest or other
amount paid or payable by the purchasing Lender in respect of the total amount
so recovered. The Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section 2.16 may, to the fullest extent
permitted by Legal Requirement, unless and until rescinded as provided above,
exercise all its rights of payment (including the right of set-off) with respect
to such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.

ARTICLE III

CONDITIONS OF LENDING

Section 3.01 Conditions Precedent to the Initial Advance. The obligation of each
Lender to make an initial Advance hereunder and of the Issuing Bank to issue an
initial Letter of Credit are subject to the following conditions precedent being
satisfied on or prior to January 31, 2005:

(a) Documentation. The Administrative Agent shall have received counterparts of
this Agreement executed by the Borrower and the Lenders, and the following duly
executed by all the parties thereto, in form and substance satisfactory to the
Administrative Agent, and, with respect to this Agreement, all Guaranties and
Environmental Indemnities, in sufficient copies for each Lender:

(i) the Guaranties and the Environmental Indemnities;

(ii) the Security Documents (or amendments thereto) to the extent applicable
executed by the Borrower, the Parent and the other Guarantors granting to the
Administrative Agent for the benefit of the Lenders an Acceptable Lien in the
Collateral, together with stock certificates, stock powers executed in blank,
UCC-1 financing statements and any other documents, agreements or instruments
necessary or desirable to create an Acceptable Lien in the Collateral, provided
that in the Administrative Agent’s discretion certain Security Documents
necessary for the granting to the Administrative Agent for the benefit of the
Lenders of an Acceptable Lien in Ownership Interests in Persons which are
domiciled outside the United States may be executed and delivered within ten
(10) Business Days of the Closing;

(iii) a certificate from a Responsible Officer of the Parent on behalf of the
Borrower dated as of the Closing Date stating that as of the Closing Date
(A) all representations and warranties of the Borrower set forth in this
Agreement and the Credit Documents are true and correct in all material
respects; (B) no Default has occurred and is continuing; (C) the conditions in
this Section 3.01 have been met or waived in writing; and (D) to the best of the
Borrower’s knowledge there are no claims, defenses, counterclaims or offsets
against the Lenders under the Credit Documents;

(iv) a certificate of the Secretary or an Assistant Secretary of the Parent on
behalf of the Borrower and each corporation and limited liability company that
is either a Guarantor or a general partner or manager of a Guarantor dated as of
the date of this Agreement certifying as of the Closing Date (A) the names and
true signatures of officers or authorized representatives of the Parent and such
other Persons authorized to sign the Credit Documents to which such Person is a
party in the capacity therein indicated, (B) resolutions of the Board of
Directors or the members of the Parent and such other Persons with respect to
the transactions herein contemplated, (C) either (x) the copies of the
organizational documents of the Parent, the Borrower and such other Persons
delivered to the Lenders are still true and correct and have not been amended or
modified since such date or (y) copies of any modification or amendment to the
organizational documents of the Parent, the Borrower or any such other Persons
made since such date, and (D) a true and correct copy of all partnership,
corporate or limited liability company authorizations necessary or desirable in
connection with the transactions herein contemplated;

(v) (A) one or more favorable written opinions of DeCampo, Diamond & Ash,
special counsel for the Borrower, the Parent, and their Subsidiaries, in a form
reasonably acceptable to the Administrative Agent, in each case dated as of the
Closing Date and with such changes as the Administrative Agent may approve, and
(B) such other legal opinions as either of the Administrative Agent shall
reasonably request, in each case dated as of the Closing Date and with such
changes as the Administrative Agent may approve, provided that in the
Administrative Agent’s discretion certain legal opinions related to Persons
which are domiciled outside the United States may be executed and delivered
within ten (10) Business Days of the Closing;

(vi) a Compliance Certificate dated as of the Closing Date reflecting for the
financial tests covered therein the financial performance for the Borrower for
the Rolling Period ended September 30, 2004, together with a certificated pro
forma balance sheet of the Parent as of the Closing Date assuming the
Pre-Existing Designated Indebtedness had been repaid, duly completed and
executed by the Chief Financial Officer or Treasurer of the Parent;

(vii) the MHC Letter; and

(viii) such other documents, governmental certificates, agreements, lien
searches as the Administrative Agent may reasonably request.

(b) Representations and Warranties. The representations and warranties contained
in Article IV hereof, the Security Agreement, the Guaranties and the
Environmental Indemnities shall be true and correct in all material respects.

(c) Certain Payments. The Borrower shall have paid or repaid, as applicable,
(i) the fees required to be paid as of the execution of this Credit Agreement
pursuant to the Fee Letter and (ii) the Pre-Existing Designated Indebtedness.

(d) Security Documents. Except as expressly contemplated by the provisions of
Section 3.01(a)(ii) above, the Administrative Agent shall have received all
appropriate evidence required by the Administrative Agent in its reasonable
discretion necessary to determine that the Administrative Agent has an
Acceptable Lien in the Collateral, including, without limitation, lien searches
conducted on the Borrower and the Guarantors and lien releases with respect to
any Collateral currently subject to a Lien other than Permitted Encumbrances.

(e) Credit Ratings. The Borrower shall have received final minimum credit
ratings in respect of the Obligations of B and B2 from S&P and Moody’s,
respectively.

(f) Material Adverse Change. No Material Adverse Change shall have occurred.

Without limiting the generality of the provisions of Section 9.04, for purposes
of determining compliance with the conditions specified in this Section 3.01,
each Lender that has signed this Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received
notice from that Lender prior to the proposed Closing Date specifying its
objection thereto.

Section 3.02 Conditions Precedent for Each Borrowing or Letter of Credit. The
obligation of each Lender to fund an Advance on the occasion of each Borrowing
(other than the Conversion or continuation of any existing Borrowing) and of any
Issuing Bank to issue or increase or extend any Letter of Credit shall be
subject to the further conditions precedent that on the date of such Borrowing
or the issuance, increase or extension of such Letter of Credit:

(a) the following statements shall be true (and each of the giving of the
applicable Notice of Borrowing and the acceptance by the Borrower of the
proceeds of such Borrowing or the issuance or increase or extension of such
Letter of Credit shall constitute a representation and warranty by the Borrower
that on the date of such Borrowing or the issuance or increase or extension of
such Letter of Credit such statements are true):

(i) the representations and warranties contained in Article IV hereof, the
Security Agreement, the Guaranties, the Environmental Indemnities and the other
Credit Documents, as such representations and warranties may change based upon
events or activities permitted by this Agreement, are correct in all material
respects on and as of the date of such Borrowing or the issuance or increase or
extension of such Letter of Credit, before and after giving effect to such
Borrowing or to the issuance or increase or extension of such Letter of Credit
and to the application of the proceeds from such Borrowing, as though made on
and as of such date; and

(ii) no Default has occurred and is continuing or would result from such
Borrowing or from the application of the proceeds therefrom, as evidenced by the
Notice of Borrowing; provided that the Leverage Ratio shown in such Notice of
Borrowing does not need to be updated from the last time the Leverage Ratio was
provided to the Administrative Agent unless an Adjustment Event has occurred
since such date; and

(b) the Administrative Agent shall have received such other approvals, opinions
or documents deemed necessary or desirable by any Lender or the Administrative
Agent as such party may reasonably request.

Section 3.03 Conditions as Covenants. If the Lenders make any Advances, or the
Issuing Bank issues a Letter of Credit, prior to the satisfaction of all
conditions precedent set forth in Sections 3.01 and 3.02., the Borrower shall
nevertheless cause such condition or conditions to be satisfied within two
(2) Business Days (ten (10) Business Days for those items for which the Borrower
is permitted such time period pursuant to the provisions of Section 3.01) after
the date of the making of such Advances or the issuance of such Letter of
Credit.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

      The Borrower represents and warrants as follows:

 
   
Section 4.01
  Existence; Qualification; Partners; Subsidiaries.
 
   

(a) The Borrower is a limited partnership duly organized, validly existing, and
in good standing under the laws of Delaware and in good standing and qualified
to do business in each jurisdiction where its ownership or lease of property or
conduct of its business requires such qualification, except where the failure to
so qualify would not cause a Material Adverse Change to the Borrower.

(b) The Parent is a corporation duly organized, validly existing, and in good
standing under the laws of Delaware and in good standing and qualified to do
business in each jurisdiction where its ownership or lease of property or
conduct of its business requires such qualification, except where the failure to
so qualify would not cause a Material Adverse Change to the Parent.

(c) The Parent is duly listed on the New York Stock Exchange, Inc. and the
Parent has timely filed all reports required to be filed by it with the New York
Stock Exchange, Inc. and the Securities and Exchange Commission.

(d) The Parent owns approximately 99% of the partnership interest in the
Borrower and is the sole general partner of the Borrower.

(e) The entire authorized capital stock of the Parent consists of
(i) 250,000,000 shares of Parent common stock of which approximately 30,631,001
shares of Parent common stock are duly and validly issued and outstanding, fully
paid and nonassessable as of September 30, 2004 and (ii) 5,000,000 shares of
Parent preferred stock of which no shares are issued or outstanding.

(f) Each Subsidiary of the Borrower or the Parent is a limited partnership,
general partnership, corporation or limited liability company duly organized,
validly existing, and in good standing under the laws of its jurisdiction of
formation and in good standing and qualified to do business in each jurisdiction
where conduct of its business requires such qualification, except where the
failure to so qualify would not cause a Material Adverse Change to such
Subsidiary. Except for the Beverage Entities, Schedule 4.01 lists the
jurisdiction of formation, and the address of the principal office of each
Subsidiary of the Borrower or the Parent existing on the date of this Agreement.
As of the date of this Agreement, the Parent or the Borrower owns, directly or
indirectly, at least the percentage interests in each such Subsidiary listed on
the attached Schedule 4.01.

Section 4.02 Partnership and Corporate Power. The execution, delivery, and
performance by the Borrower and each Guarantor of the Credit Documents to which
it is a party and the consummation of the transactions contemplated hereby and
thereby (a) are within such Persons’ partnership, limited liability company and
corporate powers, as applicable, (b) have been duly authorized by all necessary
corporate, limited liability company and partnership action, as applicable,
(c) do not contravene (i) such Person’s certificate or articles, as the case may
be, of incorporation or by-laws, operating agreement or partnership agreement,
as applicable, or (ii) any law or any contractual restriction binding on or
affecting any such Person, the contravention of which could reasonably be
expected to cause a Material Adverse Change, and (d) will not result in or
require the creation or imposition of any Lien prohibited by this Agreement. At
the time of each Borrowing, such Borrowing and the use of the proceeds of such
Borrowing will be within the Borrower’s partnership powers, will have been duly
authorized by all necessary partnership action, (a) will not contravene (i) the
Borrower’s partnership agreement or (ii) any law or any contractual restriction
binding on or affecting the Borrower, the contravention of which could
reasonably be expected to cause a Material Adverse Change, and (b) will not
result in or require the creation or imposition of any Lien prohibited by this
Agreement.

Section 4.03 Authorization and Approvals. No authorization or approval or other
action by, and no notice to or filing with, any Governmental Authority is
required for the due execution, delivery and performance by the Borrower or any
Guarantor of the Credit Documents to which it is a party or the consummation of
the transactions contemplated thereby. At the time of each Borrowing, no
authorization or approval or other action by, and no notice to or filing with,
any Governmental Authority will be required for such Borrowing or the use of the
proceeds of such Borrowing the absence of which could reasonably be expected to
cause a Material Adverse Change.

Section 4.04 Enforceable Obligations. This Agreement, the Notes, and the other
Credit Documents to which the Borrower is a party have been duly executed and
delivered by the Borrower; each Guaranty and the other Credit Documents to which
each Guarantor and the Parent is a party have been duly executed and delivered
by such Guarantor; and the Environmental Indemnity and Security Agreement have
been duly executed and delivered by the respective parties thereto. Each Credit
Document is the legal, valid, and binding obligation of the Borrower, the
Parent, and each Guarantor which is a party to it enforceable against the
Borrower, the Parent, and each such Guarantor in accordance with its terms,
except as such enforceability may be limited by any applicable bankruptcy,
insolvency, reorganization, moratorium, or similar law affecting creditors’
rights generally and by general principles of equity (whether considered in
proceeding at law or in equity).

Section 4.05 Financial Statements. The respective Consolidated balance sheets,
statements of operations, shareholders’ equity and cash flows of the Parent and
its Subsidiaries contained in the Financial Statements, and the corresponding
pro forma financial statements for the Parent and its Subsidiaries, fairly
present the financial condition in all material respects and reflects the
Indebtedness of such Person and such Person’s Subsidiaries on a Consolidated
basis as of the dates indicated in the Financial Statements and the respective
results of the operations for the periods indicated, and such balance sheets and
statements were prepared in accordance with GAAP, subject to year-end
adjustments. Since December 31, 2003, no Material Adverse Change has occurred.

Section 4.06 True and Complete Disclosure. No representation, warranty, or other
statement made by the Borrower (or on behalf of the Borrower) in this Agreement
or any other Credit Document contains any untrue statement of a material fact or
omits to state any material fact necessary to make the statements contained
therein not misleading in light of the circumstances in which they were made as
of the date of this Agreement. There is no fact known to any Responsible Officer
of the Borrower or the Parent on the date of this Agreement that has not been
disclosed to the Administrative Agent which could reasonably be expected to
cause a Material Adverse Change. All projections, estimates, and pro forma
financial information furnished by the Borrower and/or the Parent or on behalf
of the Borrower were prepared on the basis of assumptions, data, information,
tests, or conditions believed to be reasonable at the time such projections,
estimates, and pro forma financial information were furnished. No
representation, warranty or other statement made in the Parent’s latest 10K, 10Q
or annual report contains any untrue statement of material fact or omits to
state any material fact necessary to make the statements contained therein not
misleading in light of the circumstances in which they were made as of the date
same were made. Borrower and/or Parent has made all filings required by the
Exchange Act.

Section 4.07 Litigation. Except as set forth in the attached Schedule 4.07,
there is no pending or, to the best knowledge of the Borrower, threatened
investigation, action or proceeding affecting the Borrower or the Parent or any
of their respective Subsidiaries by or before any court, Governmental Authority
or arbitrator either (a) in which in Borrower’s good faith judgment the
anticipated loss is over $500,000 (provided that with respect to the giving of
this representation after the date of this Agreement, the representation shall
only be deemed to apply to those matters for which Administrative Agent would
have been entitled to notice under Section 5.05(j)) or (b) which in Borrower’s
good faith judgment would result in criminal penalties against the Parent, the
Borrower or their respective Subsidiaries which could reasonably be expected to
cause a Material Adverse Change.

Section 4.08 Use of Proceeds and Letters of Credit.

(a) Advances. The proceeds of the Advances shall be used by the Borrower for
(i) working capital and general corporate purposes, (ii) the making of Permitted
New Investments pursuant to the provisions of Section 6.06, (iii) the repayment
of Pre-Existing Designated Indebtedness, (iv) for costs incurred in connection
with the incurrence of Indebtedness issued or incurred in compliance with this
Agreement, and (v) the repurchase of the Parent’s currently outstanding common
stock as permitted by the provisions of Section 6.04(g).

(b) Regulations. No proceeds of Advances will be used to purchase or carry any
Margin Stock or be used in violation of Regulations T, U or X of the Federal
Reserve Board, as the same is from time to time in effect, and all official
rulings and interpretations thereunder or thereof. The Borrower is not engaged
in the business of extending credit for the purpose of purchasing or carrying
Margin Stock.

(c) Letters of Credit. The Letters of Credit shall be used by the Borrower in
connection with (i) the making of Permitted New Investments pursuant to the
provisions of Section 6.06 and (ii) the Borrower’s Hospitality Management
Business and ancillary activities.

Section 4.09 Investment Company Act. Neither the Borrower, the Parent nor any of
their respective Subsidiaries is an “investment company” or a company
“controlled” by an “investment company” within the meaning of the Investment
Company Act of 1940, as amended.

Section 4.10 Taxes. All federal, state, local and foreign tax returns, reports
and statements required to be filed (after giving effect to any extension
granted in the time for filing) by the Parent, the Borrower, their respective
Subsidiaries, or any member of a Controlled Group have been filed with the
appropriate governmental agencies in all jurisdictions in which such returns,
reports and statements are required to be filed, and where the failure to file
could reasonably be expected to cause a Material Adverse Change, except where
contested in good faith and by appropriate proceedings; and all taxes and other
impositions due and payable (which are material in amount) have been timely paid
prior to the date on which any fine, penalty, interest, late charge or loss
(which are material in amount) may be added thereto for non-payment thereof
except where contested in good faith and by appropriate proceedings. As of the
date of this Agreement, neither the Parent, the Borrower, any of their
respective Subsidiaries nor any member of a Controlled Group has given, or been
requested to give, a waiver of the statute of limitations relating to the
payment of any federal, state, local or foreign taxes or other impositions. None
of the Property owned by the Parent, the Borrower, any of their respective
Subsidiaries or any other member of a Controlled Group is Property which the
Parent, the Borrower, any of their respective Subsidiaries or any member of a
Controlled Group is required to be treated as being owned by any other Person
pursuant to the provisions of Section 168(f)(8) of the Code. Proper and accurate
amounts have been withheld by the Parent, the Borrower, their respective
Subsidiaries and all members of each Controlled Group from their employees for
all periods to comply in all material respects with the tax, social security and
unemployment withholding provisions of applicable federal, state, local and
foreign law. Timely payment of all material sales and use taxes required by
applicable law have been made by the Parent, the Borrower, their respective
Subsidiaries and all other members of each Controlled Group, the failure to
timely pay of which could reasonably be expected to cause a Material Adverse
Change. The amounts shown on all tax returns to be due and payable have been
paid in full or adequate provision therefore is included on the books of the
appropriate members of the applicable Controlled Group.

Section 4.11 Pension Plans. All Plans are in compliance in all material respects
with all applicable provisions of ERISA. No Termination Event has occurred with
respect to any Plan, and each Plan has complied with and been administered in
all material respects in accordance with applicable provisions of ERISA and the
Code. No “accumulated funding deficiency” (as defined in Section 302 of ERISA)
has occurred and there has been no excise tax imposed under Section 4971 of the
Code. No Reportable Event has occurred with respect to any Multiemployer Plan,
and to the Borrower’s actual knowledge each Multiemployer Plan has complied with
and been administered in all material respects with applicable provisions of
ERISA and the Code. Neither the Borrower, nor any member of a Controlled Group
has had a complete or partial withdrawal from any Multiemployer Plan for which
there is any material withdrawal liability. As of the most recent valuation date
applicable thereto, neither the Borrower nor any member of a Controlled Group
has received notice that any Multiemployer Plan is insolvent or in
reorganization.

Section 4.12 Insurance. The Borrower and each of its Subsidiaries carry the
insurance required pursuant to the provisions of Section 5.07.

Section 4.13 No Burdensome Restrictions; No Defaults.

(a) Except in connection with Indebtedness which is (i) either permitted
pursuant to the provisions of Section 6.02, or (ii) being repaid with the
proceeds of the initial Borrowing, neither the Borrower nor any of its
Subsidiaries is a party to any indenture, loan or credit agreement. Neither the
Borrower, the Parent nor any of their respective Subsidiaries is a party to any
agreement or instrument or subject to any charter or corporate restriction or
provision of applicable law or governmental regulation which could reasonably be
expected to cause a Material Adverse Change. Neither the Borrower, nor the
Parent, nor their respective Subsidiaries has entered into or suffered to exist
any agreement (other than this Agreement and the Credit Documents and as set
forth in the Permitted Property Agreements and the Permitted Housing Agreements)
(i) prohibiting the creation or assumption of any Lien upon the Properties of
the Parent, the Borrower or any of their respective Subsidiaries (except for
Properties of and Ownership Interests in the Permitted Other Subsidiaries),
whether now owned or hereafter acquired, or (ii) requiring an obligation to be
secured if some other obligation is or becomes secured.

(b) Neither the Borrower, the Parent nor any of their Subsidiaries is in default
under or with respect to any contract or agreement which could reasonably be
expected to cause a Material Adverse Change. Neither the Borrower, the Parent
nor any of their Subsidiaries has received any notice of default under any
material contract or agreement which is continuing and which, if not cured,
could reasonably be expected to cause a Material Adverse Change. The
Indebtedness of the Dallas Pledgors to FelCor is non-recourse to the Borrower
and the Guarantors and is only secured by the interests of the Dallas Pledgors
in FCH/IHC Hotels, L.P.. Under the Financial Statements the interests of the
Dallas Pledgors in FCH/IHC Hotels, L.P. have been written down to $0.

(c) No Default has occurred and is continuing (or with respect to the giving of
this representation after the date of this Agreement, as otherwise disclosed to
the Administrative Agent in writing after the date of this Agreement and prior
to the date such representation is deemed given).

Section 4.14 Environmental Condition.

(a) Except as disclosed in Schedule 4.14 (or with respect to the giving of this
representation after the date of this Agreement, as otherwise disclosed to the
Administrative Agent in writing after the date of this Agreement and prior to
the date such representation is deemed given), to the knowledge of the Borrower,
the Borrower, the Parent and their respective Subsidiaries (i) have obtained all
Environmental Permits material for the operation of their respective Properties
and the conduct of their respective businesses; (ii) have been and are in
material compliance with all terms and conditions of such Environmental Permits
and with all other requirements of applicable Environmental Laws; (iii) have not
received notice of any violation or alleged violation of any Environmental Law
or Environmental Permit; and (iv) are not subject to any actual or contingent
Environmental Claim.

(b) Except as disclosed in Schedule 4.14, to the knowledge of Borrower, no
Property which is presently or previously owned or operated by the Borrower, the
Parent or of any of their respective present or former Subsidiaries, wherever
located, (i) has been placed on or proposed to be placed on the National
Priorities List, the Comprehensive Environmental Response Compensation Liability
Information System list, or their state or local analogs, or have been otherwise
investigated, designated, listed, or identified as a Fund or other potential
site for removal, remediation, cleanup, closure, restoration, reclamation, or
other response activity under any Environmental Laws which could reasonably be
expected to cause a Material Adverse Change; (ii) is subject to a Lien, arising
under or in connection with any Environmental Laws, that attaches to any
revenues or to any Property operated by the Borrower, the Parent or any of their
respective Subsidiaries, wherever located; (iii) has been the site of any
Release, use or storage of Hazardous Substances or Hazardous Wastes from present
or past operations except for Permitted Hazardous Substances, which Permitted
Hazardous Substances have not caused at the site or at any third-party site any
condition that has resulted in or could reasonably be expected to result in the
need for Response or (iv) none of the Improvements are constructed on land
designated by any Governmental Authority having land use jurisdiction as
wetlands.

Section 4.15 Legal Requirements, Zoning. Except as set forth on Schedule 4.15
attached hereto, the current use and operation of each Property which is
presently owned or operated by the Borrower, the Parent or of any of their
respective Subsidiaries, wherever located, (a) constitutes a legal use under
applicable zoning regulations (as the same may be modified by special use
permits or the granting of variances) and (b) complies in all material respects
with all Legal Requirements, and does not violate in any material respect any
material approvals, material restrictions of record or any material agreement
affecting any such Property (or any portion thereof) except for non-legal use or
non-compliance which in the aggregate would not cause a Material Adverse Change.
The Borrower, the Parent and their respective Subsidiaries possess all
certificates of public convenience, authorizations, permits, licenses, patents,
patent rights or licenses, trademarks, trademark rights, trade names rights and
copyrights (collectively "Permits”) required by Governmental Authority to own or
operate Properties, as applicable, the Properties they own or operate, except
for those Permits that if not obtained would not cause a Material Adverse
Change. The Borrower, the Parent and their respective Subsidiaries own and
operate their business in material compliance with all applicable Legal
Requirements except for non-compliance which in the aggregate would not cause a
Material Adverse Change.

Section 4.16 Existing Indebtedness and Interest Rate Agreements; Solvency.

(a) Except for the Obligations, the only Indebtedness (including Existing
Letters of Credit) or Interest Rate Agreements of the Borrower or any of its
Subsidiaries existing as of the Effective Date are set forth on Schedule 4.16(a)
attached hereto. No “default” or “event of default”, however defined, has
occurred and is continuing under any such Indebtedness or Interest Rate
Agreement (or with respect to the giving of this representation after the date
of this Agreement, as otherwise disclosed to the Administrative Agent in writing
after the date of this Agreement and prior to the date such representation is
deemed given) except for the Indebtedness of the Dallas Pledgors to FelCor.

(b) The only Existing Letters of Credit as of the Effective Date are set forth
on Schedule 4.16(b) attached hereto.

(c) To the best of the Borrower’s knowledge, (i) the fair value and present fair
saleable value on a going concern basis of the Property of the Parent, the
Borrower and their respective Subsidiaries, on a Consolidated basis, exceeds the
amount that will be required to pay the probable liabilities of such Persons, on
a Consolidated basis, on their Indebtedness, as such Indebtedness becomes
absolute and matured, (ii) the Parent, the Borrower and their respective
Subsidiaries, on a Consolidated basis, will have sufficient cash flow to enable
them to pay their debts as they mature, and (iii) the Parent, the Borrower and
their respective Subsidiaries, on a Consolidated basis, are able to pay their
Indebtedness as it matures in the normal course of business.

Section 4.17 Leasing Arrangements. The only material leases for which either the
Borrower or a Guarantor is a lessee are office leases and leases of Units in the
Permitted Housing Business which meet the Permitted Housing Business Leasing
Guidelines.

Section 4.18 Management Agreements. The only management agreements for which
either the Borrower or a Guarantor is a manager are the Existing Management
Agreements. The Existing Management Agreements are in full force and effect; no
monetary defaults by the Borrower or any Guarantor, or to the actual knowledge
of the Borrower by any other party thereto, exist thereunder; and no other
defaults by the Borrower or any Guarantor, or to the actual knowledge of the
Borrower by any other party thereto, exist thereunder which could reasonably be
expected to cause a Material Adverse Change (or with respect to the giving of
this representation after the date of this Agreement, as otherwise disclosed to
the Administrative Agent in writing after the date of this Agreement and prior
to the date such representation is deemed given). The Existing Management
Agreements, if any, for which the counter-party has a current right to terminate
such agreement because the Borrower or a Guarantor, as applicable, did not
achieve the applicable performance target in such Existing Management Agreement
for the calendar years 2003 and/or 2004 could not reasonably be expected to
cause a Material Adverse Change (or with respect to the giving of this
representation after the date of this Agreement, as otherwise disclosed to the
Administrative Agent in writing after the date of this Agreement and prior to
the date such representation is deemed given). No notice of termination for any
such Existing Management Agreement has been received by the Borrower or any
Guarantor. Schedule 4.18 sets forth a true and correct schedule of the
anticipated termination payments to be received by the Parent, the Borrower or
their respective Subsidiaries related to terminations of management agreements
or participating leases which occurred or were announced prior to the Closing
Date.

Section 4.19 Termination of Intercompany Agreement. The intercompany agreement
that had at one time existed between the Parent, the Borrower, MHC, and MHC OP
has been terminated pursuant to documentation disclosed to the Administrative
Agent in writing.

Section 4.20 Franchise Agreements. The only franchise agreements or license
agreements to which the Borrower or a Guarantor are a party are those certain
agreements disclosed to the Administrative Agent in writing. Any such franchise
and license agreements are in full force and effect and no material defaults by
the Borrower or any Subsidiary exist thereunder (or with respect to the giving
of this representation after the date of this Agreement, as otherwise disclosed
to the Administrative Agent in writing after the date of this Agreement and
prior to the date such representation is deemed given).

Section 4.21 Owned Hospitality Properties. Except as set forth on Schedule 4.21
attached hereto, neither the Borrower, the Parent nor of any of their respective
Subsidiaries owns any Owned Hospitality Properties; provided that such Persons
do own Ownership Interests in Unconsolidated Entities which own Owned
Hospitality Properties. None of the Owned Hospitality Properties have been or
are subject to a condemnation proceeding or a casualty which individually or in
the aggregate could cause a Material Adverse Change.

Section 4.22 Approved Inter-Company Indebtedness. The only inter-company
Indebtedness between the Parent, the Borrower and any of their respective
Subsidiaries is the Approved Inter-Company Indebtedness. The Approved
Inter-Company Indebtedness Loan Documents listed on Schedule 1.01(a) are all of
the documents evidencing or securing the Approved Inter-Company Indebtedness or
executed by the applicable parties in connection with the Approved Inter-Company
Indebtedness. The Borrower has provided the Administrative Agent with a true,
correct and complete copy of the Approved Inter-Company Indebtedness Loan
Documents and such documents have not been amended or modified except as set
forth in Schedule 1.01(a). The outstanding amount of the Approved Inter-Company
Indebtedness as of the date hereof is set forth on Schedule 1.01(a).

Section 4.23 Insurance Business.

(a) Insurance Companies, Insurance Licenses and Deposited Securities. Each
Insurance Company is listed in Schedule 4.23(a). Schedule 4.23(a) hereto lists
all of the jurisdictions in which each Insurance Company holds a Insurance
License and is authorized to transact insurance business as of the Closing Date
and the line or lines of insurance in which each Insurance Company is engaged.
No Insurance License held by any Insurance Company, the loss of which could
reasonably be expected to cause a Material Adverse Change, is the subject of a
proceeding for suspension or revocation. To the knowledge of the Borrower, the
Parent or any of their respective Subsidiaries, there is not a sustainable basis
for such suspension or revocation, and no such suspension or revocation has been
threatened by any Governmental Authority. Each of the Insurance Companies has
filed all reports, statements, documents, registrations, filings or submissions
required to be filed by it with any applicable Governmental Authority, which
filings conform in all material respects to any applicable Legal Requirements,
except where the failure to so file or conform could not, individually or in the
aggregate, be reasonably expected to cause a Material Adverse Change.
Schedule 4.23(a) sets forth a true, correct and complete listing of all
securities deposited with state insurance departments and other Governmental
Authority, which deposits have been completed in accordance with the schedule of
deposits set forth in each Insurance Company’s December 31, 2003 Insurance
Annual Statement.

(b) SAP Financial Statements, Examination Reports and Loss Runs. The Borrower
has previously delivered to the Administrative Agent for distribution to each of
the Lenders true and complete copies of the SAP Financial Statements as filed
with the domiciliary state insurance departments of each Insurance Company as of
and for the years ended December 31, 2003, 2002 and 2001, prepared in compliance
with GAAP. Each of the SAP Financial Statements fairly presents in all material
respects the results of operations of the applicable Insurance Company for the
period therein set forth, in each case in accordance with SAP. The schedules
included in the SAP Financial Statements, when considered in relation to the
basic statutory financial statements included therein, present fairly in all
material respects the information shown therein. Each of the SAP Financial
Statements was correct in all material respects when filed and did not omit to
state any material facts required to be stated or necessary in order to make the
SAP Financial Statements not misleading. The Borrower has previously delivered
to the Administrative Agent for distribution to each of the Lenders true and
complete copies of all examination reports of insurance departments and any
insurance regulatory agencies since December 31, 2003 relating to the Insurance
Companies. The loss runs for the years ended December 31, 2003, 2002 and 2001,
which the Borrower has previously delivered to the Administrative Agent for
distribution to each of the Lenders in writing, are true, correct and complete
in all material respects.

(c) Investment Portfolios. The Borrower has previously delivered to the
Administrative Agent for distribution to each of the Lenders true and complete
lists as of December 31, 2003 of all assets held in the investment portfolios of
the Insurance Companies. None of the investments included in such investment
portfolios is in default with respect to the payment of principal, interest or
dividends thereon or is materially impaired. All such investments comply with
all applicable Legal Requirements except for non-compliance which in the
aggregate would not cause a Material Adverse Change. Each Insurance Company owns
assets which qualify as admitted assets under applicable state insurance Legal
Requirements in an amount at least equal to the sum of all of its Insurance
Reserve Liabilities and minimum statutory capital and Insurance Surplus
reflected on the latest SAP Financial Statements.

(d) Insurance Reserve Liabilities and Adequate Provisions. All Insurance Reserve
Liabilities as established or reflected in the SAP Financial Statements (i) were
determined in accordance with generally accepted actuarial standards
consistently applied, (ii) are fairly stated in accordance with sound actuarial
principles, (iii) are based on actuarial assumptions that are in accordance with
those called for by the relevant Insurance Contract and the related Reinsurance
Contract and (iv) meet in all material respects the requirements of all
applicable insurance Legal Requirements. Adequate provision for such Insurance
Reserve Liabilities has been made (under generally accepted actuarial principles
consistently applied) to cover the total amount of all reasonably anticipated
matured and unmatured benefits, dividends, claims and other liabilities of the
Insurance Companies under all Insurance Contracts and Reinsurance Contracts on
the date of such SAP Financial Statement based on then current information that
forms a reasonable basis for such determination. Each of the Insurance Companies
owns assets that qualify as legal reserve assets under applicable insurance
Legal Requirements in an amount at least equal to all of such Insurance
Company’s Insurance Reserve Liabilities. Adequate provision has been made for
all estimated losses, settlements, costs and expenses from pending suits,
actions and proceedings contemplated by the SAP Financial Statements.

(e) Insurance Contracts and Reinsurance Contracts. Each outstanding Insurance
Contract issued, reinsured or underwritten by an Insurance Company is listed in
Schedule 4.23(e), together with the maximum amount payable by an Insurance
Company thereunder. All outstanding Reinsurance Contracts with respect to such
Insurance Contracts are listed in Schedule 4.23(e), together with the maximum
amount payable by an Insurance Company thereunder. All Insurance Contracts,
Reinsurance Contracts and any and all marketing materials are, to the extent
required under applicable Legal Requirements, on forms approved by the insurance
regulatory authority of the jurisdiction where issued or filed and have not been
objected to by such authority within the period provided for objection and have
been filed or registered as required with all other applicable Governmental
Authorities. As to premium rates established by each Insurance Company and
required to be filed or approved, the premiums charged comply with the
applicable Legal Requirements. In addition, there is no pending or, to the
knowledge of the Borrower, the Parent or any of their respective Subsidiaries,
threatened charge by any insurance regulatory authority that any of the
Insurance Companies has violated, nor any pending or, to the knowledge of the
Borrower, the Parent or any of their respective Subsidiaries, threatened
investigation by any insurance regulatory authority with respect to possible
violations of, any applicable Legal Requirements where such violations would,
individually or in the aggregate, cause a Material Adverse Change. All Insurance
Contracts and Reinsurance Contracts have been marketed, sold and issued in
compliance with all applicable Legal Requirements, except as could not
reasonably be expected to cause a Material Adverse Change, including, without
limitation, in compliance with (i) all applicable prohibitions against
“redlining” or withdrawal of business lines, (ii) all applicable requirements
relating to the disclosure of the nature of insurance products as policies of
insurance and (iii) all applicable requirements relating to insurance product
projections and illustrations.

(f) Payment of Benefits. All benefits payable with respect to each Insurance
Contract by a Insurance Company or, to the knowledge of the Borrower, the Parent
or any of their respective Subsidiaries, by any other person that is a party to
or bound by such Insurance Contract, have in all material respects been paid in
accordance with the terms of such Insurance Contract. All benefits payable with
respect to each Reinsurance Contract, have in all material respects been paid in
accordance with the terms of such Reinsurance Contract.

(g) Notice of Likely Defaults. No Insurance Company has received any written, or
to the knowledge of the Borrower, the Parent or any of their respective
Subsidiaries, oral information that would cause it to believe that the financial
condition of any other party to any Insurance Contract or Reinsurance Contract
is so impaired as to be reasonably likely to result in a default by such party
under such contract which could reasonably be expected to cause a Material
Adverse Change.

Section 4.24 Permitted Housing Business Leasing. Schedule 4.24 sets forth a true
and accurate summary of the Units currently leased by the Parent and the
Parent’s Subsidiaries’, together with (a) a description of the market for such
Units, (b) the breakdown of whether the term of the applicable lease of such
Units is less than or equal to 1 year, greater than 1 year but less than
5 years, or equal to or greater than 5 years, and (c) the occupancy level by
market for such Units as of the Effective Date.

ARTICLE V

AFFIRMATIVE COVENANTS

So long as any Note or any amount under any Credit Document shall remain unpaid,
any Letter of Credit shall remain outstanding, or any Lender shall have any
Commitment hereunder, the Borrower agrees to comply and cause the Parent and the
Parent’s Subsidiaries to comply with the following covenants.

Section 5.01 Compliance with Laws. The Borrower will comply, and cause the
Parent and each of its Subsidiaries to comply, in all material respects with all
Legal Requirements.

Section 5.02 Preservation of Existence; Separateness, Etc.

(a) The Borrower will preserve and maintain, and cause each of its Subsidiaries
to preserve and maintain, its partnership, limited liability company or
corporate (as applicable) existence, rights, franchises and privileges in the
jurisdiction of its formation, and qualify and remain qualified, and cause each
such Subsidiary to qualify and remain qualified, as a foreign partnership,
corporation or limited liability company, as applicable in each jurisdiction in
which qualification is necessary or desirable in view of its business and
operations or the ownership of its properties, and, in each case, where failure
to qualify or preserve and maintain its rights and franchises could reasonably
be expected to cause a Material Adverse Change.

(b) The Parent common stock shall at all times be duly listed on the New York
Stock Exchange, Inc. and (ii) the Parent shall timely file all reports required
to be filed by it with the New York Stock Exchange, Inc. and the Securities and
Exchange Commission.

(c) The Borrower shall cause the Permitted Other Subsidiaries which have
Indebtedness to, (i) maintain financial statements, accounting records and other
corporate records and other documents separate from all non-Permitted Other
Subsidiaries, (ii) maintain their own bank accounts in their own name, separate
from all non-Permitted Other Subsidiaries, (iii) pay their own expenses and
other liabilities from their own assets and incur (or endeavor to incur)
obligations to other Persons based solely upon their own assets and
creditworthiness and not upon the creditworthiness of each other or any other
Person, and (iv) file their own tax returns or, if part of a consolidated group,
join in the consolidated tax return of such group as a separate member thereof.

(d) The Borrower shall, and shall cause the Permitted Other Subsidiaries which
have Indebtedness to, take all actions necessary to keep such Permitted Other
Subsidiaries, separate from the Borrower and the Borrower’s other Subsidiaries,
including, without limitation, (i) the taking of action under the direction of
the Board of Directors, members or partners, as applicable, of such Permitted
Other Subsidiaries and, if so required by the Certificate of Incorporation or
the Bylaws, operating agreement or partnership agreement, as applicable, of such
Permitted Other Subsidiaries or by any Legal Requirement, the approval or
consent of the stockholders, members or partners, as applicable, of such
Permitted Other Subsidiaries, (ii) the preparation of corporate, partnership or
limited liability company minutes for or other appropriate evidence of each
significant transaction engaged in by such Permitted Other Subsidiaries,
(iii) the observance of separate approval procedures for the adoption of
resolutions by the Board of Directors or consents by the partners, as
applicable, of such Permitted Other Subsidiaries, on the one hand, and of the
Borrower and the Borrower’s other Subsidiaries, on the other hand, and
(iv) preventing the cash, cash equivalents, credit card receipts or other
revenues of the Hospitality Properties owned by such Permitted Other
Subsidiaries or any other assets of such Permitted Other Subsidiaries from being
commingled with the cash, cash equivalents, credit card receipts or other
revenues collected by the Borrower or the Borrower’s other Subsidiaries.

(e) The Borrower shall take all steps reasonably necessary to avoid
(i) misleading any other Person as to the identity of the entity with which such
Person is transacting business or (ii) implying that the Borrower is, directly
or indirectly, absolutely or contingently, responsible for the Indebtedness or
other obligations of the Permitted Other Subsidiaries or any other Person.

Section 5.03 Payment of Taxes, Etc. The Borrower will pay and discharge, and
cause each of its Subsidiaries to pay and discharge, before the same shall
become delinquent (a) all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or Property that are material in
amount, prior to the date on which penalties attach thereto and (b) all lawful
claims that are material in amount which, if unpaid, might by Legal Requirement
become a Lien upon its Property; provided, however, that neither the Borrower
nor any such Subsidiary shall be required to pay or discharge any such tax,
assessment, charge, levy, or claim (a) which is being contested in good faith
and by appropriate proceedings, (b) with respect to which reserves in conformity
with GAAP have been provided, (c) such charge or claim does not constitute and
is not secured by any choate Lien on any portion of any Owned Hospitality
Property and no portion of any Owned Hospitality Property is in jeopardy of
being sold, forfeited or lost during or as a result of such contest, (d) neither
the Administrative Agent nor any Lender could become subject to any civil fine
or penalty or criminal fine or penalty, in each case as a result of non-payment
of such charge or claim and (e) such contest does not, and could not reasonably
be expected to, result in a Material Adverse Change.

Section 5.04 Visitation Rights; Lender Meeting. Subject to the rights of the
owners of the Hospitality Properties for which there are Permitted Property
Agreements, at any reasonable time and from time to time and so long as any
visit or inspection will not unreasonably interfere with the Borrower’s or any
of its Subsidiary’s operations, upon reasonable notice, the Borrower will permit
the Administrative Agent and any Lender or any of its agents or representatives
thereof, to examine and make copies of and abstracts from the records and books
of account of, and visit and inspect at its reasonable discretion the Properties
owned or operated by the Borrower and any of its Subsidiaries, to discuss the
affairs, finances and accounts of such Persons with any of their respective
officers or directors. Without in any way limiting the foregoing, the Borrower
will, upon the request of the Administrative Agent, participate in a meeting
with the Administrative Agent and the Lenders once during each calendar year to
be held at the Borrower’s office in the District of Columbia or New York, New
York (or such other location as may be agreed to by the Borrower and the
Administrative Agent) at such time as may be agreed to by the Borrower and the
Administrative Agent.

Section 5.05 Reporting Requirements. The Borrower will furnish to the
Administrative Agent, with respect to those items set forth in clauses (a)-(c)
and (i), and each Lender:

(a) Quarterly Financials. As soon as available and in any event not later than
fifty (50) days after the end of each Fiscal Quarter of the Parent (except for
the Fiscal Quarter which ends on the date the Fiscal Year ends), the unaudited
Consolidated balance sheets of the Parent and its Subsidiaries as of the end of
such quarter and the related unaudited statements of income, shareholders’
equity and cash flows of the Parent and its Subsidiaries for such Fiscal Quarter
and the period commencing at the end of the previous year and ending with the
end of such Fiscal Quarter, and the corresponding figures as at the end of, and
for, the corresponding periods in the preceding Fiscal Year, all duly certified
with respect to such statements (subject to reasonable year-end audit
adjustments) by a Responsible Officer of the Parent as having been prepared in
accordance with GAAP, together with a Compliance Certificate duly executed by a
Responsible Officer of the Parent; provided that the Total Indebtedness used to
calculate the Leverage Ratio in such Compliance Certificate shall be the Total
Indebtedness as of the Status Reset Date during the Fiscal Quarter in which such
Compliance Certificate was delivered.

(b) Annual Financials. As soon as available and in any event not later than
ninety-five (95) days after the end of each Fiscal Year of the Parent, a copy of
the Consolidated balance sheets of the Parent and its Subsidiaries as of the end
of such Fiscal Year and the related Consolidated statements of income,
shareholders’ equity and cash flows of the Parent and its Subsidiaries for such
Fiscal Year, and the corresponding figures as at the end of, and for, the
preceding Fiscal Year, and audited and certified by KPMG, L.L.P. or other
independent certified public accountants of nationally recognized standing
reasonably acceptable to the Administrative Agent in an opinion, without
qualification as to the scope or any other material qualification or exception,
and including, if requested by the Administrative Agent, any management letters
delivered by such accountants to the Parent in connection with such audit,
together with (i) the unaudited consolidating financial statements of the Parent
and its Subsidiaries as of such date or for such time period, as applicable,
(ii) a Compliance Certificate duly executed by a Responsible Officer of the
Parent and (iii) a certificate duly executed by a Responsible Officer of the
Parent which reflects in detail reasonably acceptable to the Administrative
Agent the financial performance of the applicable Person related to the
financial covenants contained in the documentation for any Permitted Other
Indebtedness. As soon as available and in any event not later than 50 days after
the end of each Fiscal Year of the Parent, the Borrower will furnish to the
Administrative Agent a draft Compliance Certificate duly executed by a
Responsible Officer of the Parent for such end of Fiscal Year financial
statements. Such draft Compliance Certificate will be used for purposes of
re-determining Status at the Status Reset Date following the end of such Fiscal
Year. If the final Compliance Certificate delivered in connection with the
financial statements for the end of such Fiscal Year reflects a different Status
than that reflected in the draft Compliance Certificate, then (a) the Borrower
shall be deemed to have been at the Status set forth in the final Compliance
Certificate since the Status Reset Date following the end of the Fiscal Year and
(b) within five (5) Business Days following delivery of such final Compliance
Certificate, either the Borrower will pay to the Lenders or the Lenders will pay
to the Borrower, as applicable, the amount of the adjustment of interest and
fees payable by the Borrower under this Agreement because of such adjustment in
Status.

(c) Securities Law Filings. Promptly and in any event within fifteen (15) days
after the sending or filing thereof, copies of all proxy material, reports and
other information which the Borrower, the Parent or any of their respective
Subsidiaries sends to or files with the United States Securities and Exchange
Commission or sends to all of the shareholders of the Parent or partners of the
Borrower.

(d) Defaults. As soon as possible and in any event within five (5) days after
the occurrence of each Default known to a Responsible Officer of the Parent, the
Borrower or any of their respective Subsidiaries, a statement of an authorized
financial officer or Responsible Officer of the Borrower setting forth the
details of such Default and the actions which the Borrower has taken and
proposes to take with respect thereto.

(e) ERISA Notices. As soon as possible and in any event (i) within thirty (30)
days after the Parent, the Borrower or any of a Controlled Group knows to know
that any Termination Event described in clause (a) of the definition of
Termination Event with respect to any Plan has occurred, (ii) within ten
(10) days after the Parent, the Borrower or any of a Controlled Group knows that
any other Termination Event with respect to any Plan has occurred, a statement
of the Chief Financial Officer of the Parent describing such Termination Event
and the action, if any, which the Parent, the Borrower or such member of such
Controlled Group proposes to take with respect thereto; (iii) within ten
(10) days after receipt thereof by the Parent, the Borrower or any of a
Controlled Group from the PBGC, copies of each notice received by the Parent,
the Borrower or any such member of such Controlled Group of the PBGC’s intention
to terminate any Plan or to have a trustee appointed to administer any Plan; and
(iv) within ten (10) days after receipt thereof by the Parent, the Borrower or
any member of a Controlled Group from a Multiemployer Plan sponsor, a copy of
each notice received by the Parent, the Borrower or any member of such
Controlled Group concerning the imposition or amount of withdrawal liability
pursuant to Section 4202 of ERISA.

(f) Environmental Notices. Promptly upon the knowledge of any Responsible
Officer of the Borrower of receipt thereof by the Borrower or any of its
Subsidiaries, a copy of any form of notice, summons or citation received from
the United States Environmental Protection Agency, or any other Governmental
Authority concerning (i) violations or alleged violations of Environmental Laws,
which seeks to impose liability therefore, (ii) any action or omission on the
part of the Parent or the Borrower or any of their present or former
Subsidiaries in connection with Hazardous Waste or Hazardous Substances which,
based upon information reasonably available to the Borrower, could reasonably be
expected to cause a Material Adverse Change or an Environmental Claim in excess
of $1,000,000, (iii) any notice of potential responsibility under CERCLA, or
(iv) concerning the filing of a Lien upon, against or in connection with the
Parent, Borrower, their present or former Subsidiaries, or any of their leased,
owned or operated Property, wherever located.

(g) Other Governmental Notices or Actions. Promptly and in any event within five
Business Days after receipt thereof by the Parent, Borrower or any of their
respective Subsidiaries, (i) a copy of any notice, summons, citation, or
proceeding seeking to adversely modify in any material respect, revoke, or
suspend any license, permit, or other authorization from any Governmental
Authority, which action could reasonably be expected to cause a Material Adverse
Change, and (ii) any revocation or involuntary termination of any license,
permit or other authorization from any Governmental Authority, which revocation
or termination could reasonably be expected to cause a Material Adverse Change.

(h) Reports Affecting the Leverage Ratio. On or prior to the 15th day following
any Adjustment Event, an Adjustment Report with respect to such Adjustment
Event.

(i) Corporate Activity. Promptly following any merger or dissolution of any
Subsidiary of the Borrower which is permitted hereunder or event which would
make any of the representations in Section 4.01-4.04 untrue, notice thereof.

(j) Material Litigation. As soon as possible and in any event within five (5)
days of any Responsible Officer of the Borrower, the Parent or any of their
respective Subsidiaries having knowledge thereof, notice of any litigation,
claim or any other event which could reasonably be expected to cause a Material
Adverse Change.

(k) Insurance Information. Within ten (10) days of request by the Administrative
Agent, the Borrower shall provide the Administrative Agent copies of the
unaudited Insurance Annual Statement of each Insurance Company, certified by a
Responsible Officer of the Parent as fairly presenting the financial condition
and results of operations of such Insurance Company in accordance with SAP
consistently applied throughout the periods reflected therein and the most
recent examination reports and loss run sheets of the Insurance Companies.

(l) Budget. On or prior to January 31st of each Fiscal Year, the Borrower shall
provide the Administrative Agent (for distribution to the Lenders) an operating
budget for the Parent and its Subsidiaries on a Consolidated basis for such
Fiscal Year, including without limitation pro forma balance sheet, income
statement, cash flow and financial covenant compliance.

(m) Other Information. Such other information respecting the business or
Properties, or the condition or operations, financial or otherwise, of the
Borrower, the Parent or any of their respective Subsidiaries, as any Lender
through the Administrative Agent may from time to time reasonably request.

The Borrower hereby acknowledges and agrees that (a) the Administrative Agent
and/or its Affiliate will make available to the Lenders and the Issuing Bank
materials and/or information provided by or on behalf of the Parent and/or the
Borrower hereunder (collectively, “Materials”) by posting the Materials on
IntraLinks or another similar electronic system (the “Platform”), (b) neither
the Administrative Agent, nor any Affiliate, nor their respective directors,
officers, employees and agents shall be liable for any damages arising from the
use by unintended recipients of the Materials or other materials distributed
through the Platform or other electronic, telecommunications or information
transmissions systems, and (c) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do not wish to receive material non-public
information with respect to the Borrower or its securities) (each, a “Public
Lender”). The Borrower hereby agrees that (w) all Materials that are to be made
available to Public Lenders shall be clearly and conspicuously marked “PUBLIC”
which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently
on the first page thereof; (x) by marking Materials “PUBLIC”, the Parent and the
Borrower shall be deemed to have authorized the Administrative Agent, its
Affiliates, the Issuing Lender and the Lenders to treat such Materials as either
publicly available information or not material information (although it may be
sensitive and proprietary) with respect to the Borrower, the Parent or their
respective securities for purposes of United States Federal and state securities
laws; (y) all Materials marked “PUBLIC” are permitted to be made available
through a portion of the Platform designated “Public Investor;” and (z) the
Administrative Agent and its Affiliates shall be entitled to treat any Materials
that are not marked “PUBLIC” as being suitable only for posting on a portion of
the Platform not designated “Public Investor.”

Section 5.06 Maintenance of Property. The Borrower will, and will cause each of
the Parent and its Subsidiaries to (a) maintain their Owned Hospitality
Properties in a manner consistent for Hospitality Properties and related
property of the same quality and character and shall keep or cause to be kept
every part thereof and its other properties in good condition and repair,
reasonable wear and tear excepted, and make all reasonably necessary repairs,
renewals or replacements thereto as may be reasonably necessary to conduct the
business of the Borrower and its Subsidiaries, (b) not knowingly or willfully
permit the commission of waste or other injury, or the occurrence of pollution,
contamination or any other condition in, on or about any of their Owned
Hospitality Properties, (c) substantially maintain and repair each of their
Owned Hospitality Properties as required by any franchise agreement, license
agreement, management agreement or ground lease for such Owned Hospitality
Property, and (d) perform such Person’s obligations under the Permitted Property
Agreements and the Permitted Housing Agreements to which such Person is a party
except where the non-performance thereof in the aggregate would not reasonably
be expected to cause a Material Adverse Change.

Section 5.07 Insurance. The Borrower will maintain, and cause each of its
Subsidiaries to maintain, the insurance required pursuant to Schedule 5.07.

Section 5.08 Use of Proceeds and Letters of Credit. The Advances and Letters of
Credit shall be used by the Borrower for the purposes set forth in Section 4.08.

Section 5.09 Collateral; Releases.

(a) Subject to the time periods set forth in Section 5.10 and Section 6.06(d)
for executing Security Documents in connection with the acquisition of Permitted
New Investments and subject to the time periods set forth in Section 3.01(a)(ii)
with respect to satisfying certain conditions precedent related to Ownership
Interests in Persons domiciled outside the United States, the Parent, the
Borrower and the Subsidiaries (i) will cause at all times the Administrative
Agent to have an Acceptable Lien in the Collateral, (ii) will cause at all times
all material provisions of the Security Documents to be valid and binding on the
Persons executing such Security Documents and (iii) shall execute or re-execute
such Security Documents and take such other actions as the Administrative Agent
shall reasonably request in order for the Administrative Agent to maintain or
create an Acceptable Lien in the Collateral, including without limitation any
Collateral acquired by the Borrower the Parent, or any of the other Guarantors
after the Closing Date. Without limiting the foregoing, on the Closing Date the
Parent will grant to the Administrative Agent an Acceptable Lien in the Parent’s
Ownership Interests in the Borrower at the time of granting such Acceptable Lien
and thereafter maintain such Acceptable Lien.

(b) Notwithstanding the foregoing, upon request of the Borrower to the
Administrative Agent and any repayment of Advances required under this Agreement
in connection therewith, the Administrative Agent will release from the Liens of
the Security Documents (i) the Property which is the subject of a Permitted
Asset Disposition at the time of such Permitted Asset Disposition and (ii) any
Owned Hospitality Property and the Ownership Interests in the Permitted Other
Subsidiary which owns such Owned Hospitality Property in connection with the
incurrence of Permitted Other Indebtedness to be secured by such Collateral. If
the Property released in connection with any such Permitted Asset Disposition
includes all or substantially all of the Ownership Interests in a Guarantor, or
if a Guarantor incurs Permitted Other Indebtedness, then, upon request of the
Borrower to the Administrative Agent, at the time of such Permitted Asset
Disposition or the incurrence of such Permitted Other Indebtedness, as
applicable, the Administrative Agent shall release such Guarantor from the
Guaranty and the other Credit Documents to which such Guaranty is a party. In
addition, the Administrative Agent agrees to take, and the Lenders authorize the
Administrative Agent to take, such actions as are reasonably requested by the
Borrower and at the Borrower’s expense to terminate the Liens and security
interests created by the Credit Documents when all the Obligations are paid in
full and all Letters of Credit and Commitments are terminated.

Section 5.10 New Subsidiaries. Except with respect to a Permitted Other
Subsidiary that has incurred or issued Permitted Other Indebtedness, within ten
(10) Business Days after either (a) the date that any Subsidiary of the Parent
that was not a Material Subsidiary becomes a Material Subsidiary, or (b) the
purchase by the Parent or any of its Subsidiaries of the Ownership Interests of
any Person, which purchase results in such Person becoming a Material Subsidiary
the Parent shall, in each case, cause (i) such Material Subsidiary to execute
and deliver to the Administrative Agent either (A) a Guaranty, an Environmental
Indemnity and a Security Agreement or (B) an Accession Agreement, (ii) any of
the Borrower and any Guarantor who is a direct owner of the Ownership Interests
of such Material Subsidiary to execute and deliver to the Administrative Agent a
Security Agreement, if necessary, and such other documents as are necessary to
create an Acceptable Lien in the Ownership Interests in the Material Subsidiary
owned by such Person (and such other Security Documents as the Administrative
Agent may reasonably request) and (iii) the Persons who are party to the
documents delivered pursuant to the provisions of this Section 5.10 to provide
such evidence of authority to enter into such documents as the Administrative
Agent may reasonably request.

Section 5.11 Insurance Business.

(a) The Borrower will cause each of the Insurance Companies to (i) carry on and
conduct its business only in substantially the same manner and in substantially
the same fields of enterprise as it is presently conducted, (ii) only engage in
the insurance business or the business of a holding company owning entities
engaged in the insurance business or the business of insurance or reasonably
incidental activities, (iii) do all things necessary to renew, extend and
continue in effect all Insurance Licenses which may at any time and from time to
time be necessary for each Insurance Company to conduct business in compliance
with all applicable Legal Requirements, including, if applicable, the filing of
all appropriate Insurance Annual Statements and SAP Financial Statements;
provided, that each Insurance Company may withdraw from one or more states
(other than its state of domicile) as an admitted insurer if such withdrawal is
determined by the Insurance Company’s Board of Directors to be in the best
interest of the Insurance Companies and could not reasonably be expected to
cause a Material Adverse Change.

(b) The Borrower will not permit the Insurance Surplus, as of the last day of
each Fiscal Quarter, to be less than that required by applicable Legal
Requirements. The Borrower will not permit the maximum amount payable by all
Insurance Companies under Insurance Contracts or Reinsurance Contracts, as of
the last day of each Fiscal Quarter, to be greater than $10,000,000.

Section 5.12 Interest Rate Agreements. From the date 60 days following the
Closing Date until the Maturity Date, the Borrower shall cause the Parent to
obtain and thereafter maintain Interest Rate Agreements reasonably satisfactory
to the Administrative Agent, sufficient to ensure that at least 50% of the Total
Indebtedness, measured as of each day during such period, shall be covered by
such Interest Rate Agreements or shall have a fixed rate of interest. Any
Interest Rate Agreements for the Parent shall be provided by either a Lender or
a bank or other financial institution whose long-term debt rating is equal to or
greater than “A”; provided that the Lenders will have a right of first refusal,
but not an obligation, to provide any Interest Rate Agreements for the Parent on
substantially such terms as the Parent would be able to obtain from any such
non-Lender. To the extent that any Interest Rate Agreement is provided by a
Lender, the obligations of the Parent or its Subsidiary under such Interest Rate
Agreement may be secured by the Collateral pari passu with the Obligations.
However, the pledge of any Collateral to secure any Interest Rate Agreement from
any non-Lender shall be subject to the written approval of the Required Lenders.
The dollar amount subject to Interest Rate Agreements in the aggregate shall not
exceed the sum of the amount of the Advances and the amount of the other
Indebtedness of the Borrower or its Affiliates which bears interest at a
variable rate.

ARTICLE VI

NEGATIVE COVENANTS

So long as any Note or any amount under any Credit Document shall remain unpaid,
any Letter of Credit shall remain outstanding, or any Lender shall have any
Commitment, the Borrower agrees to comply and cause the Parent and the Parent’s
Subsidiaries to comply with the following covenants.

Section 6.01 Liens, Etc. The Borrower, the Parent and their respective
Subsidiaries will not create, assume, incur or suffer to exist, any Lien on or
in respect of any of its Property whether now owned or hereafter acquired, or
assign any right to receive income, except that the Borrower and its
Subsidiaries may create, incur, assume or suffer to exist Liens:

(a) securing the Obligations;

(b) for taxes, assessments or governmental charges or levies on Property of the
Borrower or any Guarantor to the extent not required to be paid pursuant to
Sections 5.03;

(c) imposed by law (such as landlords’, carriers’, warehousemen’s and mechanics’
liens or otherwise arising from litigation) (i) which are being contested in
good faith and by appropriate proceedings, (ii) with respect to which reserves
in conformity with GAAP have been provided, (iii) which have not resulted in any
Collateral being in jeopardy of being sold, forfeited or lost during or as a
result of such contest, (iv) neither the Administrative Agent nor any Lender
could become subject to any civil fine or penalty or criminal fine or penalty,
in each case, as a result of non-payment of such charge or claim, and (v) such
contest does not, and could not reasonably be expected to, result in a Material
Adverse Change;

(d) on leased personal property to secure solely the lease obligations
associated with such property;

(e) on the Property of or Ownership Interests in a Permitted Other Subsidiary
securing Indebtedness set forth in paragraph (a) of the definition of “Permitted
Other Indebtedness” incurred by such Permitted Other Subsidiary to the extent
such Indebtedness is permitted pursuant to the provisions of Section 6.02;

(f) on the Ownership Interests in an Unconsolidated Entity or Minority-Owned
Fund securing Permitted Non-Recourse Unconsolidated Entity Indebtedness incurred
by such Unconsolidated Entity or Minority-Owned Fund, as applicable;

(g) granted to the owner of a Hospitality Property subject to a Permitted
Property Agreement on the accounts receivable, inventory, cash or other property
owned by the Borrower or the Borrower’s Subsidiary in connection with such
Hospitality Property; and

(h) easements, rights of way, covenants, restrictions, zoning and similar
restrictions and other similar charges or encumbrances not interfering with the
ordinary conduct of the business of the Borrower or its Subsidiaries and which
do not detract materially from the value of any of the Owned Hospitality
Properties to which they attach or impair materially the use thereof by the
Borrower or the Borrower’s Subsidiaries.

Section 6.02 Indebtedness. The Borrower, the Parent and their respective
Subsidiaries will not incur or permit to exist any Indebtedness other than the
Obligations and the following:

(a) Permitted Other Indebtedness in an amount that does not cause a breach at
any time of the covenants contained in Article VII;

(b) Capital Leases for personal property;

(c) Interest Rate Agreements permitted under this Agreement; and

(d) Any of the following Indebtedness incurred by the Parent or the Borrower:

(i) guaranties in connection with Permitted Other Indebtedness secured by an
Owned Hospitality Property or interest in a Person owning a Hospitality Property
of (A) if the Hospitality Property is subject to a ground lease, the payment of
rent and performance of obligations under such ground lease, (B) real estate
taxes relating to such Hospitality Property, and (C) capital reserves required
under such Indebtedness, provided that such guaranties do not include guaranties
of the Permitted Other Indebtedness itself;

(ii) guaranties of the payment of rent and performance of obligations under a
ground lease for an Owned Hospitality Property which is Collateral;

(iii) customary recourse “carve-outs” for Indebtedness permitted under this
Agreement which is otherwise non-recourse to the Parent, the Borrower and their
respective Subsidiaries;

(iv) guaranties of franchise and license agreements in connection with
Hospitality Properties; and

(v) guaranties of obligations of the Parent’s Subsidiaries or Unconsolidated
Entities with respect to Permitted Property Agreements and Permitted Housing
Agreements; and

(e) extensions, renewals and refinancing of any of the Indebtedness specified in
paragraphs (a) — (d) above so long as the principal amount of such Indebtedness
is not thereby increased.

Section 6.03 Agreements Restricting Distributions From Subsidiaries. The
Borrower will not, nor will it permit any of its Subsidiaries (other than
Permitted Other Subsidiaries) to, enter into any agreement (other than a Credit
Document) which limits distributions to or any advance (including by way of the
making of and repayment of Intercompany loans and advances) by any of the
Borrower’s Subsidiaries to the Borrower.

Section 6.04 Restricted Payments. Neither the Parent, nor the Borrower, nor any
of their respective Subsidiaries, will make any Restricted Payment, except that:

(a) provided that no Default has occurred and is continuing or would result
therefrom, the Borrower shall be entitled to make cash distributions to its
partners, including the Parent, which distributions for partners other than the
Parent and the Parent’s Subsidiaries do not in the aggregate in any Fiscal Year
exceed $100,000;

(b) a Subsidiary of the Borrower may make a Restricted Payment to the Borrower;

(c) the limited partners of the Borrower shall be entitled to exchange limited
partnership interests in the Borrower for the Parent’s common stock;

(d) the Borrower shall be entitled to issue limited partnership interests in the
Borrower in exchange for Ownership Interests in Subsidiaries and Unconsolidated
Entities to the extent such Investment is permitted pursuant to the provisions
of Section 6.06;

(e) provided that no monetary Default or Default in the covenants set forth in
Article VII has occurred and is continuing or would result therefrom, then the
Borrower shall be entitled to pay (i) interest, but not principal (except only
as permitted by clause (ii) of this subsection (g)), of Subordinate Indebtedness
permitted pursuant to this Agreement, and (ii) principal of Approved
Inter-Company Indebtedness; provided that any such principal payments (A) are
made to a Guarantor, (B) are either retained by such Guarantor or distributed to
the Borrower, the Parent or another Guarantor and (C) are used in accordance
with the provisions of this Agreement; and

(f) provided that (i) no monetary Default or Default in the covenants set forth
in Article VII has occurred and is continuing or would result therefrom, and
(ii) no Material Adverse Change has occurred, the Parent shall be entitled to
repurchase up to $5,000,000 in the aggregate of the Parent’s currently
outstanding common stock after the Closing Date. Within ten (10) Business Days
of any such Restricted Payments in the aggregate reaching increments of $250,000
(i.e., $250,000, $500,000, $750,000) the Borrower shall execute and deliver to
the Administrative Agent an Adjustment Report dated as of the date of reaching
such Restricted Payment increment which takes into account such Restricted
Payments. To the extent that the Parent reaches multiple $250,000 increments
over any ten (10) Business Day period, then an Adjustment Report need only be
provided as of the date of the reaching the last such $250,000 increment in such
ten (10) Business Day period. In addition, any Compliance Certificate delivered
by the Borrower shall state the dollar amount of such Restricted Payments made
in the Rolling Period covered by such Compliance Certificate and the amount of
all such Restricted Payments in the aggregate.

Section 6.05 Fundamental Changes; Asset Dispositions. Neither the Parent, the
Borrower, nor any of their respective Subsidiaries (other than the Permitted
Other Subsidiaries), will (a) merge or consolidate with or into any other
Person, unless (i) either (A) a Guarantor is merged into the Borrower and the
Borrower is the surviving Person, (B) a Subsidiary (other than a Permitted Other
Subsidiary which has Indebtedness other than the Obligations) is merged into any
Subsidiary (other than a Permitted Other Subsidiary which has Indebtedness other
than the Obligations) or (C) a Guarantor other than the Parent is merged into
another Person (other than a Permitted Other Subsidiary which has Indebtedness
other than the Obligations) and the surviving Person is or promptly becomes a
Guarantor, and (ii) immediately after giving effect to any such proposed
transaction, (X) no Default would exist, (Y) on a pro forma basis the financial
covenants set forth in Article VII would be satisfied and (Z) to the extent a
Person who was not a Subsidiary of the Parent or the Borrower is merged with or
into a Guarantor, then the Administrative Agent shall in its reasonable
discretion be entitled to determine the Investment Amount applicable to such
merger; (b) sell, transfer, or otherwise dispose of all or any of such Person’s
material Property except for a Permitted Asset Disposition, or dispositions or
replacements of personal property in the ordinary course of business; (c) enter
into, as lessor, a lease (other than a lease which qualifies as a Permitted
Asset Disposition) of all or substantially all of any Owned Hospitality Property
with any Person without the consent of the Administrative Agent; (d) sell or
otherwise dispose of any material Ownership Interests of any Subsidiary (except
for a Permitted Other Subsidiary or a sale which qualifies as a Permitted Asset
Disposition); (e) except for (i) Capitalization Events for which the
consideration is principally cash or cash equivalents and for which the
Repayment Amount is applied in accordance with the provisions of
Section 2.07(c), (ii) the issuance of limited partnership interests in the
Borrower in exchange for Ownership Interests in Subsidiaries and Unconsolidated
Entities to the extent permitted pursuant to the provisions of Section 6.04, and
(iii) transactions permitted under the preceding clause (a), materially alter
the corporate, capital or legal structure of any such Person (except for a
Permitted Other Subsidiary); (f) enter into any forward sales of the Parent
common stock or Ownership Interests in the Borrower; (g) liquidate, wind-up or
dissolve itself (or suffer any liquidation or dissolution) provided that nothing
herein shall prohibit the Borrower from dissolving any Subsidiary which has no
assets on the date of dissolution, (h) enter into any leases of Property or
management agreements for any Property except (1) Permitted Property Agreements,
(2) Permitted Housing Agreements, (3) leases of office space for the use of the
Parent’s and the Parent’s Subsidiaries’ employees, and (4) the leases of
personal property permitted by this Agreement or (i) materially alter the
character of their respective businesses from that conducted as of the date of
this Agreement or otherwise engage in any material business activity outside of
the Hospitality Management Business or the ownership and operation of
Hospitality Properties.

Section 6.06 Investments and other Property. Neither the Parent, the Borrower,
nor any of their respective Subsidiaries, shall acquire by purchase or otherwise
any Investments or other Property, except the following:

(a) Investments or Properties owned by such Persons as of the Closing Date;

(b) Liquid Investments;

(c) trade and customer accounts receivable which are for goods furnished or
services rendered in the ordinary course of business and are payable in
accordance with customary trade terms, and receivables purchased in connection
with the acquisition of an Owned Hospitality Property;

(d) Investments in Permitted New Investments or Subsidiaries making Permitted
New Investments; provided that (i) within ten (10) Business Days of the
acquisition by the Parent or any of the Parent’s Subsidiaries of any Collateral
for which the Administrative Agent on behalf of the Lenders does not already
have an Acceptable Lien, the Borrower, the Parent and the other Guarantors will
execute such Security Documents as are necessary or desirable for the
Administrative Agent on behalf of the Lenders to have an Acceptable Lien in such
Collateral and (ii) within twenty (20) Business Days of the acquisition of an
Owned Hospitality Property by the Parent or any of the Parent’s Subsidiaries
which is required by the terms of this Agreement to be Collateral, the Borrower
shall deliver to the Administrative Agent a Title Policy for such Owned
Hospitality Property;

(e) other assets, including Capital Expenditures, acquired or made in the
ordinary course of (i) owning the Parent’s and the Parent’s Subsidiaries’
existing Investments and Properties and any Permitted New Investments and
(ii) operating a Hospitality Management Business; and

(f) loans to employees of the Parent or its Subsidiaries which in the aggregate
do not exceed $1,000,000.

Notwithstanding the foregoing, neither the Borrower, nor the Parent, nor their
respective Subsidiaries shall make an Investment, acquire any other Property, or
enter into any Permitted Property Agreement or Permitted Housing Agreement which
would (a) cause a Default, (b) cause or result in the Borrower or the Parent
failing to comply with any of the financial covenants contained herein, or
(c) cause or result in the aggregate Adjusted EBITDA in any Rolling Period
derived from all Permitted Property Agreements, Permitted Housing Agreements or
other Investments related to Hospitality Properties which are not full-service
or limited service hotels or resorts or conference centers to exceed 35% of the
Parent’s Adjusted EBITDA for such Rolling Period. In addition, neither the
Borrower, nor the Parent, nor their respective Subsidiaries shall enter into any
agreements to purchase Investments or other Property, unless with respect to
such purchase such Person at all times has available sources of funds equal to
pay in full the cost of the purchase of such Investments or other Property (to
the extent that the payment of such cost of purchase constitutes a recourse
obligation of the Parent, the Borrower or its Subsidiary), which available
sources of funds may include Advances to the extent that the Borrower may borrow
the same for the purposes required or other Indebtedness permitted by the terms
of this Agreement.

Section 6.07 Affiliate Transactions. Except for certain liquor license
agreements, the Borrower will not, and will not permit any of its Subsidiaries
to, make, directly or indirectly: (a) any transfer, sale, lease, assignment or
other disposal of any assets to any Affiliate of the Borrower which is not a
Guarantor or any purchase or acquisition of assets from any such Affiliate
except for purchases of new personal property (i) which in any calendar year do
not exceed $1,000,000 in the aggregate and (ii) for which the sales price is the
actual cost to the party selling; or (b) any arrangement or other transaction
directly or indirectly with or for the benefit of any such Affiliate (including
without limitation, guaranties and assumptions of obligations of an Affiliate),
other than in the ordinary course of business and at market rates.

Section 6.08 Sale or Discount of Receivables. The Borrower will not, and will
not permit any of its Subsidiaries to, directly or indirectly, sell with
recourse, or discount or otherwise sell for less than the face value thereof,
any of its notes or accounts receivable.

Section 6.09 Material Documents. The Borrower will not, nor will it permit any
of its Subsidiaries to (a) amend the Borrower’s partnership agreement in any
material respect, (b) admit a new general partner to the Borrower, (c) enter
into any termination or material modification or amendment of Permitted Property
Agreements which singly or in the aggregate could reasonably be expected to
cause a Material Adverse Change, or (d) modify the Approved Inter-Company
Indebtedness Loan Documents in any way that is materially adverse to the
Lenders.

Any termination, modification or amendment prohibited under this Section 6.09
without the Required Lender’s written consent shall, to the extent permitted by
applicable law, be void and of no force and effect.

Section 6.10 No Further Negative Pledges. Neither the Borrower, nor the Parent,
nor their respective Subsidiaries shall enter into or suffer to exist any
agreement (other than this Agreement and the Credit Documents and as set forth
in the Permitted Property Agreements and the Permitted Housing Agreements)
(a) prohibiting the creation or assumption of any Lien upon the Properties of
the Parent, the Borrower or any of their respective Subsidiaries (except for
Properties of and Ownership Interests in the Permitted Other Subsidiaries),
whether now owned or hereafter acquired, or (b) requiring an obligation to be
secured if some other obligation is or becomes secured; provided that in
connection with the incurrence of Unsecured Indebtedness which is permitted by
this Agreement, the Parent and its Subsidiaries may enter into such agreements
which would require that assets of the Parent and its Subsidiaries which secure
any Indebtedness (other than the Obligations, any refinancing or increase in the
Obligations, or the Indebtedness described in clause (a) of the definition of
Permitted Other Indebtedness) also secure on an equal and ratable basis such
Unsecured Indebtedness and which agreements must be in form and substance
reasonably acceptable to the Administrative Agent.

Section 6.11 Limitation on Hedge Agreements. Neither the Borrower, the Parent,
nor any of their respective Affiliates shall enter into any Interest Rate
Agreement or any Currency Agreement other than the Interest Rate Agreements
permitted by the terms of this Agreement and non-speculative Currency Agreements
which are reasonably necessary or desirable in connection with such Persons’
foreign operations.

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6

ARTICLE VII

FINANCIAL COVENANTS

So long as any Note or any amount under any Credit Document shall remain unpaid,
any Letter of Credit shall remain outstanding, or any Lender shall have any
Commitment hereunder, unless the Required Lenders shall otherwise consent in
writing, the Borrower agrees to comply and cause the Parent and the Parent’s
Subsidiaries to comply with the following covenants:

Section 7.01 Interest Coverage Ratio. The Parent shall maintain at the end of
each Rolling Period (a) for the Rolling Period ending on September 30, 2004, an
Interest Coverage Ratio of not less than 3.00 to 1.00, and (b) for any Rolling
Period thereafter, an Interest Coverage Ratio of not less than 3.50 to 1.00.

Section 7.02 Leverage Ratio. The Parent shall not on any date permit the
Leverage Ratio to exceed during the applicable period indicated in the following
chart the amount set forth in such chart for such period:

                  Beginning Date of   Ending Date of     Applicable Period  
Applicable Period   Leverage Ratio     The day immediately         prior to the
Status         Reset Date during         the Fiscal Quarter         commencing
April 1,     Closing Date   2005   3.75 to 1.00
 
  The day immediately
       
The Status Reset
  prior to the Status
       
Date during the
  Reset Date during
       
Fiscal Quarter
  the Fiscal Quarter
       
commencing April 1,
  commencing January
       
2005
    1, 2006       3.50 to 1.00  
 
               
The Status Reset Date during the Fiscal Quarter commencing January 1, 2006
  No ending date
    3.00 to 1.00  
 
               

Section 7.03 Maintenance of Net Worth. The Parent shall at all times maintain an
Adjusted Net Worth of not less than the Minimum Net Worth.

ARTICLE VIII

EVENTS OF DEFAULT; REMEDIES

Section 8.01 Events of Default. The occurrence of any of the following events
shall constitute an “Event of Default” under any Credit Document:

(a) Principal Payment or Letter of Credit Obligation Payment. The Borrower or
any Guarantor shall fail to pay any principal of any Note or any Letter of
Credit Obligation when the same becomes due and payable as set forth in this
Agreement;

(b) Interest or Other Obligation Payment. The Borrower or any Guarantor shall
fail to pay any interest on any Note or any fee or other amount payable
hereunder or under any other Credit Document when the same becomes due and
payable as set forth in this Agreement or such other Credit Document, as
applicable, provided however that the Borrower and the Guarantors will have a
grace period of three (3) days after the payments covered by this
Section 8.01(b) becomes due and payable for the first two defaults of such
Persons collectively under this Section 8.01(b) in every calendar year;

(c) Representations and Warranties. Any representation or warranty made or
deemed to be made (i) by the Borrower in this Agreement or in any other Credit
Document, (ii) by the Borrower (or any of its officers) in connection with this
Agreement or any other Credit Document, or (iii) by any Guarantor in any Credit
Document shall prove to have been incorrect in any material respect when made or
deemed to be made;

(d) Covenant Breaches. (i) The Borrower shall fail to perform or observe any
covenant contained in Section 5.02, Article VI or Article VII of this Agreement,
(ii) the Borrower shall fail to perform or observe, or shall fail to cause any
Guarantor to perform or observe any covenant in any Credit Document beyond any
notice and/or cure period for such default expressly provided in such Credit
Document or (iii) the Borrower or any Guarantor shall fail to perform or observe
any term or covenant set forth in any Credit Document which is not covered by
clause (i) or (ii) above or any other provision of this Section 8.01, in each
case if such failure shall remain unremedied for thirty (30) days after the
earlier of the date written notice of such default shall have been given to the
Borrower or such Guarantor by the Administrative Agent or any Lender or the date
a Responsible Officer of the Borrower or any Guarantor has actual knowledge of
such default, unless such default in this clause (iii) cannot be cured in such
thirty (30) day period and the Borrower is diligently proceeding to cure such
default, in which event the cure period shall be extended to ninety (90) days;
provided that the Borrower shall not be entitled to more than the aforementioned
thirty (30) day period to cure a default under Section 5.09 of this Agreement;

(e) Cross-Defaults. With respect to any Indebtedness of the Borrower, the Parent
or any of their respective Subsidiaries (but excluding Indebtedness evidenced by
the Notes) which exceeds the Threshold Amount, any of the following:

(i) any such Indebtedness shall be declared to be due and payable, or required
to be prepaid (other than by a regularly scheduled required prepayment), prior
to the stated maturity thereof,

(ii) such Person shall fail to pay any principal of or premium or interest of
any of such Indebtedness (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument
relating to such Indebtedness, or

(iii) any other event shall occur or condition shall exist under any agreement
or instrument relating to such Indebtedness, and shall continue after the
applicable grace period, if any, specified in such agreement or instrument, if
the effect of such event or condition is to permit the holders of such
Indebtedness to accelerate the maturity of such Indebtedness;

(f) Insolvency. The Borrower, the Parent or any of their respective Material
Subsidiaries shall generally not pay its debts as such debts become due, or
shall admit in writing its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors; or any proceeding shall be
instituted by or against the Borrower, the Parent or any of their respective
Material Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee or other
similar official for it or for any substantial part of its property and, in the
case of any such proceeding instituted against the Borrower, the Parent or any
of their respective Material Subsidiaries, either such proceeding shall remain
undismissed for a period of 60 days or any of the actions sought in such
proceeding shall occur; or the Borrower, the Parent or any of their respective
Material Subsidiaries shall take any corporate action to authorize any of the
actions set forth above in this paragraph (f);

(g) Judgments. Any judgment or order for the payment of money in excess of
$5,000,000 or the Dollar Equivalent thereof (reduced for purposes of this
paragraph for the amount in respect of such judgment or order that a reputable
insurer has acknowledged being payable under any valid and enforceable insurance
policy) shall be rendered against the Borrower, the Parent or any of their
respective Subsidiaries which, within thirty (30) days from the date such
judgment is entered, shall not have been discharged or execution thereof stayed
pending appeal;

(h) ERISA. (i) Any Person shall engage in any “prohibited transaction” (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any “accumulated funding deficiency” (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan, (iii) a Reportable
Event shall occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is likely to result in the termination of such Plan for
purposes of Title IV of ERISA, unless such Reportable Event, proceedings or
appointment are being contested by the Borrower in good faith and by appropriate
proceedings, (iv) any Plan shall terminate for purposes of Title IV of ERISA,
(v) the Borrower or any member of a Controlled Group shall incur any liability
in connection with a withdrawal from a Multiemployer Plan or the insolvency
(within the meaning of Section 4245 of ERISA) or reorganization (within the
meaning of Section 4241 of ERISA) of a Multiemployer Plan, unless such liability
is being contested by the Borrower in good faith and by appropriate proceedings,
or (vi) any other event or condition shall occur or exist, with respect to a
Plan; and in each case in clauses (i) through (vi) above, such event or
condition, together with all other such events or conditions, if any, could
subject the Borrower or any Guarantor to any tax, penalty or other liabilities
in the aggregate exceeding $10,000,000;

(i) Guaranty. Any provision of any Guaranty shall for any reason cease to be
valid and binding on any Guarantor or any Guarantor shall so state in writing;

(j) Environmental Indemnity. Any Environmental Indemnity shall for any reason
cease to be valid and binding on any Person party thereto or any such Person
shall so state in writing;

(k) Security Document. The Borrower or any Guarantor shall cause any material
Security Document to be invalid or non-binding on any Person party thereto or
any such Person shall so state in writing;

(l) Collateral. A Material Adverse Change occurs because all or a portion of the
Collateral shall for any reason cease to be subject to an Acceptable Lien except
as expressly permitted by this Agreement;

(m) Parent Common Stock; Repayment Event The Parent at any time hereafter fails
to (i) cause the Parent common stock to be duly listed on the New York Stock
Exchange, Inc. and (ii) file timely all reports required to be filed by the
Parent with the New York Stock Exchange, Inc. and the Securities and Exchange
Commission and, with respect to a failure under clause (ii), such failure
remains uncured on the date which is the earlier of (A) the date thirty
(30) days following the initial occurrence of such failure and (B) the date
specified by the New York Stock Exchange, Inc. or the Securities and Exchange
Commission as the date such failure needs to be cured by. Upon the receipt by
the Parent of any Net Cash Proceeds from a Repayment Event, (i) the Parent fails
to immediately make a capital contribution or advance to the Borrower or a
Subsidiary of the Borrower of the Repayment Amount for such Repayment Event, or
otherwise apply the Repayment Amount for such Repayment Event in accordance with
the provisions of this Agreement or (ii) the Borrower fails to apply such
Repayment Amount in accordance with the provisions of this Agreement;

(n) Change in Ownership or Control. Any of the following occur without the
written consent of the Required Lenders: (i) a Change in Control occurs for
either the Parent or the Borrower; or (ii) the Parent and any wholly-owned
Subsidiary of the Parent collectively owns less than 70% of the legal or
beneficial interest in the Borrower;

(o) Permitted Property Agreements. Any of the following occur: (i) sufficient
Permitted Property Agreements shall for any reason cease to be valid and binding
on MHC, MHC OP or other Person party thereto, or MHC, MHC OP or such other
Person party thereto shall so state in writing, that it could reasonably be
expected to cause a Material Adverse Change; or (ii) a default by the Parent,
the Borrower or any of their respective Subsidiaries shall occur under
sufficient Permitted Property Agreements that such default could reasonably be
expected to cause a Material Adverse Change; or

(p) Letter. Any provision of the MHC Letter shall for any reason cease to be
valid and binding on any Person, or any Person shall so state in writing.

Section 8.02 Optional Acceleration of Maturity; Other Actions. If any Event of
Default (other than an Event of Default pursuant to paragraph (f) of
Section 8.01) shall have occurred and be continuing, then, and in any such
event,

(a) the Administrative Agent (i) shall at the request, or may with the consent,
of the Required Lenders, by notice to the Borrower, declare the obligation of
each Lender to make Advances and the obligation of Issuing Bank to issue,
increase, or extend Letters of Credit to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or may with the consent, of
the Required Lenders, by notice to the Borrower, declare the Notes, all interest
thereon, the Letter of Credit Obligations, and all other amounts payable under
this Agreement to be forthwith due and payable, whereupon the Notes, all such
interest, all such Letter of Credit Obligations and all such amounts shall
become and be forthwith due and payable in full, without presentment, demand,
protest or further notice of any kind (including, without limitation, any notice
of intent to accelerate or notice of acceleration), all of which are hereby
expressly waived by the Borrower,

(b) the Borrower shall, on demand of the Administrative Agent at the request or
with the consent of the Required Lenders, deposit into the Cash Collateral
Account an amount of cash equal to the Letter of Credit Exposure as security for
the Obligations to the extent the Letter of Credit Obligations are not otherwise
paid at such time, and

(c) the Administrative Agent shall at the request of, or may with the consent
of, the Required Lenders proceed to enforce its rights and remedies under the
Credit Documents for the ratable benefit of the Lenders by appropriate
proceedings.

Section 8.03 Automatic Acceleration of Maturity. If any Event of Default
pursuant to paragraph (f) of Section 8.01 shall occur,

(a) the obligation of each Lender to make Advances and the obligation of Issuing
Bank to issue, increase, or extend Letters of Credit shall immediately and
automatically be terminated and the Notes, all interest on the Notes, all Letter
of Credit Obligations, and all other amounts payable under this Agreement shall
immediately and automatically become and be due and payable in full, without
presentment, demand, protest or any notice of any kind (including, without
limitation, any notice of intent to accelerate or notice of acceleration), all
of which are hereby expressly waived by the Borrower and

(b) to the extent permitted by law or court order, the Borrower shall deposit
with the Administrative Agent into the Cash Collateral Account an amount of cash
equal to the outstanding Letter of Credit Exposure as security for the
Obligations to the extent the Letter of Credit Obligations are not otherwise
paid at such time.

Section 8.04 Cash Collateral Account.

(a) Pledge. The Borrower hereby pledges, and grants to the Administrative Agent
for the benefit of the Lenders, a security interest in all funds held in the
Cash Collateral Account maintained with the Administrative Agent from time to
time, and all proceeds thereof, as security for the payment of the Obligations,
including without limitation all Letter of Credit Obligations owing to any
Issuing Bank or any other Lender due and to become due from the Borrower to any
Issuing Bank or any other Lender under this Agreement in connection with the
Letters of Credit and the Borrower agrees to execute all cash management or cash
collateral agreements and UCC-1 Financing Statements requested by the
Administrative Agent as needed or desirable for the Administrative Agent to have
an Acceptable Lien in the Cash Collateral Account.

(b) Application against Letter of Credit Obligations. The Administrative Agent
may, at any time or from time to time, apply funds then held in the Cash
Collateral Account to the payment of any Letter of Credit Obligations owing to
any Issuing Bank, in such order as the Administrative Agent may elect, as shall
have become or shall become due and payable by the Borrower to any Issuing Bank
under this Agreement in connection with the Letters of Credit.

(c) Duty of Care. The Administrative Agent shall exercise reasonable care in the
custody and preservation of any funds held in the Cash Collateral Account and
the Administrative Agent shall be deemed to have exercised such care if such
funds are accorded treatment substantially equivalent to that which the
Administrative Agent accords its own property, it being understood that the
Administrative Agent shall not have any responsibility for taking any necessary
steps to preserve rights against any parties with respect to any such funds.

Section 8.05 Non-exclusivity of Remedies. No remedy conferred upon the
Administrative Agent or the Lenders is intended to be exclusive of any other
remedy, and each remedy shall be cumulative of all other remedies existing by
contract, at law, in equity, by statute or otherwise.

Section 8.06 Right of Set-off.

(a) Upon (i) the occurrence and during the continuance of any Event of Default
pursuant to paragraph (f) of Section 8.01 or (ii) the making of the request or
the granting of the consent, if any, specified by Section 8.02 to authorize the
Administrative Agent to declare the Notes and any other amount payable hereunder
due and payable pursuant to the provisions of Section 8.02 or the automatic
acceleration of the Notes and all amounts payable under this Agreement pursuant
to Section 8.03, each Lender and Affiliate thereof is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender or any Affiliate thereof to or for the credit or the account of the
Borrower against any and all of the obligations of the Borrower now or hereafter
existing under this Agreement, the Note held by such Lender, and the other
Credit Documents, irrespective of whether or not such Lender shall have made any
demand under this Agreement, such Note, or such other Credit Documents, and
although such obligations may be unmatured. Each Lender agrees to promptly
notify the Borrower after any such set-off and application made by such Lender
or its Affiliate, provided that the failure to give such notice shall not affect
the validity of such set-off and application. The rights of each Lender under
this Section are in addition to any other rights and remedies (including,
without limitation, other rights of set-off) which such Lender may have.

(b) The Borrower waives any right of set-off, defense or counterclaim the
Borrower has or may have against any Lender to apply any amounts owed the
Borrower by such Lender or any Affiliate thereof against the Obligations
hereunder.

ARTICLE IX

AGENCY AND ISSUING BANK PROVISIONS

Section 9.01 Authorization and Action. Each Lender and each Issuing Bank hereby
appoints and authorizes the Administrative Agent to take such action as
Administrative Agent on its behalf and to exercise such powers under this
Agreement and the other Credit Documents as are delegated to the Administrative
Agent by the terms hereof and of the other Credit Documents, together with such
powers as are reasonably incidental thereto. As to any matters not expressly
provided for by this Agreement or any other Credit Document (including, without
limitation, enforcement or collection of the Notes), the Administrative Agent
shall not be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Required Lenders,
and such instructions shall be binding upon all Lenders and all holders of
Notes; provided, however, that the Administrative Agent shall not be required to
take any action which exposes the Administrative Agent to personal liability or
which is contrary to this Agreement, any other Credit Document, or applicable
law. The functions of the Administrative Agent are administerial in nature and
in no event shall the Administrative Agent have a fiduciary or trustee relation
in respect of any Lender by reason of this Agreement or any other Credit
Document. Within five (5) Business Days of the Administrative Agent receiving
actual knowledge (without any duty to investigate) of a Default, the
Administrative Agent will provide written notice of such Default to the Lenders
and each Issuing Bank.

Section 9.02 Administrative Agent’s Reliance, Etc. Neither the Administrative
Agent nor any of its directors, officers, agents or employees shall be liable
for any action taken or omitted to be taken (including such Person’s own
negligence) by it or them under or in connection with this Agreement or the
other Credit Documents, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the
Administrative Agent: (a) may treat the payee of any Note as the holder thereof
until the Administrative Agent receives written notice of the assignment or
transfer thereof signed by such payee and in form satisfactory to the
Administrative Agent; (b) may consult with legal counsel (including counsel for
the Borrower), independent public accountants and other experts selected by it
and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts; (c) makes no warranty or representation to any Lender and shall not be
responsible to any Lender for any statements, warranties or representations made
in or in connection with this Agreement or the other Credit Documents; (d) shall
not have any duty to ascertain or to inquire as to the performance or observance
of any of the terms, covenants or conditions of this Agreement or any other
Credit Document on the part of the Borrower, the Parent or their respective
Subsidiaries or to inspect the property (including the books and records) of the
Borrower, the Parent or their respective Subsidiaries; (e) shall not be
responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
Credit Document other than with respect to the Administrative Agent’s execution
of the documents to which the Administrative Agent is a party; and (f) shall
incur no liability under or in respect of this Agreement or any other Credit
Document by acting upon any notice, consent, certificate or other instrument or
writing (which may be by telecopier, telegram, cable or telex) believed by it to
be genuine and signed or sent by the proper party or parties.

Section 9.03 Administrative Agent and Its Affiliates. With respect to its
Commitment, the Advances made by it and the Notes issued to it, the
Administrative Agent and each Issuing Bank shall have the same rights and powers
under this Agreement as any other Lender and may exercise the same as though it
were not an Administrative Agent and an Issuing Bank, respectively. The term
“Lender” or “Lenders” shall, unless otherwise expressly indicated, include the
Administrative Agent and each Issuing Bank in their individual capacities as
Lenders. The Administrative Agent, each Issuing Bank, the Lenders and their
respective Affiliates may accept deposits from, lend money to, act as trustee
under indentures of, and generally engage in any kind of business with, the
Borrower or any of its Subsidiaries, and any Person who may do business with or
own securities of the Borrower or any such Subsidiary, all as if the
Administrative Agent were not an Administrative Agent hereunder, an Issuing Bank
was not an Issuing Bank hereunder or the Lenders were not Lenders hereunder and
without any duty to account therefore to the Lenders.

Section 9.04 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent, an Issuing
Bank or any other Lender and based on the financial statements referred to in
Section 4.05 and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent, an Issuing Bank or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement.

Section 9.05 Indemnification. The Lenders severally agree to indemnify the
Administrative Agent and Issuing Bank (to the extent not reimbursed by the
Borrower), according to their respective Pro Rata Shares from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against the
Administrative Agent or such Issuing Bank in any way relating to or arising out
of this Agreement or any action taken or omitted by the Administrative Agent or
such Issuing Bank under this Agreement or any other Credit Document (including
the Administrative Agent’s or such Issuing Bank’s own negligence), provided that
no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are determined by a court of competent jurisdiction by a
final and non-appealable judgment to have resulted from the Administrative
Agent’s or such Issuing Bank’s gross negligence or willful misconduct; provided
further that to the extent any Issuing Bank is entitled to indemnification under
this Section 9.05, the indemnification provided for in this Section 9.05 will be
the obligation solely of the Lenders with Revolving Commitments. Without
limitation of the foregoing, each applicable Lender agrees to reimburse the
Administrative Agent and each Issuing Bank promptly upon demand for its Pro Rata
Share of (a) any out-of-pocket expenses (including reasonable counsel fees)
incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement or any
other Credit Document, to the extent that the Administrative Agent is not
reimbursed for such expenses by the Borrower and (b) any amount that the
Borrower fails to pay that is required to be paid by the Borrower to an Issuing
Bank under Section 10.04.

Section 9.06 Successor Administrative Agent and Issuing Banks. The
Administrative Agent or any Issuing Bank may resign at any time by giving
written notice thereof to the Lenders and the Borrower and may be removed at any
time with cause by the Required Lenders upon receipt of written notice from the
Required Lenders to such effect. Upon receipt of notice of any such resignation
or removal, the Required Lenders shall have the right to appoint a successor
Administrative Agent or Issuing Bank. If no successor Administrative Agent or
Issuing Bank shall have been so appointed, and shall have accepted such
appointment, within thirty (30) days after the retiring Administrative Agent’s
or Issuing Bank’s giving of notice of resignation or the Required Lenders’
removal of the retiring Administrative Agent or Issuing Bank, then the retiring
Administrative Agent or Issuing Bank, as applicable, may, on behalf of the
Lenders and the Borrower, appoint a successor Administrative Agent or Issuing
Bank, which shall be a commercial bank meeting the financial requirements of an
Eligible Assignee and, in the case of an Issuing Bank, a Lender. Upon the
acceptance of any appointment as Administrative Agent or Issuing Bank by a
successor Administrative Agent or Issuing Bank, such successor Administrative
Agent or Issuing Bank shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent or
Issuing Bank, as applicable, and the retiring Administrative Agent or Issuing
Bank shall be discharged from its duties and obligations under this Agreement
and the other Credit Documents, except that the retiring Issuing Bank shall
remain an Issuing Bank with respect to any Letters of Credit issued by such
Issuing Bank and outstanding on the effective date of its resignation or removal
and the provisions affecting such Issuing Bank with respect to such Letters of
Credit shall inure to the benefit of the retiring Issuing Bank until the
termination of all such Letters of Credit. After any retiring Administrative
Agent’s or Issuing Bank’s resignation or removal hereunder as Administrative
Agent or Issuing Bank, the provisions of this Article IX shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was such
Administrative Agent or Issuing Bank under this Agreement and the other Credit
Documents.

Section 9.07 Arrangers, Book Runners, and other Agents. Under the Credit
Documents SG Americas shall be named Sole Lead Arranger and Bookrunner, and
other Persons may be named agents or other titles, but such Persons in such
capacities shall have no right or duty to act as agent on behalf of the Lenders.

ARTICLE X

MISCELLANEOUS

Section 10.01 Amendments, Etc.

(a) No amendment or waiver of any provision of this Agreement, the Notes, or any
other Credit Document, nor consent to any departure by the Borrower or any
Guarantor therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Required Lenders (or by the Administrative Agent with
the consent of such Required Lenders), as specified in the particular provisions
of the Credit Documents, and the Borrower, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided, however, that no amendment shall increase the Commitment
of any Lender without the prior written consent of such Lender, and no
amendment, waiver or consent shall, unless in writing and signed by all the
Lenders whose Commitments or Advances are directly modified thereby, do any of
the following: (i) increase the aggregate Commitments of the Lenders except as
permitted by Section 2.01(c), (ii) reduce or forgive the principal of, or
interest on, the Notes or any fees or other amounts payable hereunder or under
any other Credit Document or otherwise release the Borrower from any
Obligations, (iii) postpone any date fixed for any payment of principal of
(including any Maturity Date), or interest on, the Notes or any fees or other
amounts payable hereunder, (iv) amend this Section 10.01, (v) amend the
definition of “Required Lenders”, “Pro Rata Share”, or “Maximum Facility
Amount”, (vi) release the Parent from its obligations under the Guaranty or
release any other Guarantor which owns or leases an Owned Hospitality Property
from its obligations under any of the Guaranties except as contemplated by the
provisions of Section 5.09, (vii) release all or substantially all of the
Collateral, (viii) release as Collateral all or substantially all of the
Ownership Interests in the Borrower or (ix) extend the Interest Period beyond
six (6) months; and provided, further, that no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent or any Issuing
Bank, as applicable, in addition to the Lenders required above to take such
action, affect the rights or duties of the Administrative Agent or such Issuing
Bank, as the case may be, under this Agreement or any other Credit Document. In
addition, the definition of “Revolving Required Lenders” cannot be amended
without the unanimous written consent of all Lenders holding Revolving
Commitments. In addition, the definition of “Term Required Lenders” cannot be
amended without the unanimous written consent of all Lenders holding Term
Commitments and Term Advances.

(b) In addition, without the consent of each of the Revolving Required Lenders
and the Term Required Lenders voting as separate Classes no amendment or waiver
shall (i) amend or waive the provisions in Sections 2.07(c) and (b), 2.10(a) and
(e) or 2.16 regarding the pro rata treatment, the order of application of
proceeds and the sharing of payments or (ii) permit other Indebtedness to have a
Lien on any Collateral.

(c) Any amendment to a covenant of the Parent or any of its Subsidiaries or
amendment to a definition shall require the Borrower’s written consent.

(d) Notwithstanding the foregoing, the Administrative Agent and the Borrower
(without the consent of any other Lender or the Issuing Bank) may enter into
amendments of any Credit Document solely with respect to corrections of formal
defects not having any economic impact.

Section 10.02 Notices, Etc. All notices and other communications shall be in
writing (including telecopy or telex) and mailed, telecopied, telexed, hand
delivered or delivered by a nationally recognized overnight courier, (a) if to
the Borrower, at its address at 4501 N. Fairfax Drive, Arlington, Virginia
22203, Attn: Chief Financial Officer; (b) if to any Lender, at its Applicable
Lending Office; (c) if to the Administrative Agent or the Issuing Bank, at its
address at 4900 Trammell Crow Center, 2001 Ross Avenue, Dallas, Texas 75201,
Attention: Thomas K. Day, Managing Director (telecopy: (214) 979-2727;
telephone: (214) 979-2774); or, (d) as to each party, at such other address or
teletransmission number as shall be designated by such party in a written notice
to the other parties. All such notices and communications shall, when mailed,
telecopied, telexed or hand delivered or delivered by overnight courier, be
effective three days after deposited in the mails, when telecopy transmission is
completed, when confirmed by telex answer-back or when delivered, respectively,
except that notices and communications to the Administrative Agent pursuant to
Article II or Article IX shall not be effective until received by the
Administrative Agent.

Section 10.03 No Waiver; Remedies. No failure on the part of any Lender, any
Agent, or any Issuing Bank to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies provided in
this Agreement and the other Credit Documents are cumulative and not exclusive
of any remedies provided by law.

Section 10.04 Costs and Expenses. The Borrower agrees to pay on demand all
out-of-pocket costs and expenses of the Administrative Agent in connection with
the preparation, execution, delivery, due diligence, administration,
modification and amendment of this Agreement, the Notes and the other Credit
Documents and syndication of the Obligations including, without limitation,
(a) the reasonable fees and out-of-pocket expenses of Bracewell & Patterson,
L.L.P., counsel for the Administrative Agent, and (b) all reasonable
out-of-pocket costs and expenses, if any, of the Administrative Agent, Issuing
Bank, and each Lender (including, without limitation, reasonable counsel fees
and expenses of the Administrative Agent, such Issuing Bank, and each Lender) in
connection with the enforcement (whether through negotiations, legal proceedings
or otherwise) of this Agreement and the other Credit Documents, and (d) to the
extent not included in the foregoing, the costs of any local counsel, travel
expenses, Appraisals, Engineering Reports, Environmental Reports, Title
Policies, mortgage and intangible taxes (if any), and any title or Uniform
Commercial Code search costs, any flood plain search costs, insurance consultant
costs and other costs usual and customary in connection with a credit facility
of this type.

Section 10.05 Binding Effect. This Agreement shall become effective when it
shall have been executed by the Borrower and the Administrative Agent, and when
the Administrative Agent shall have, as to each Lender, either received a
counterpart hereof executed by such Lender or been notified by such Lender that
such Lender has executed it and thereafter shall be binding upon and inure to
the benefit of the Borrower, the Administrative Agent, Issuing Bank, and each
Lender and their respective successors and assigns, except that the Borrower
shall not have the right to assign its rights or delegate its duties under this
Agreement or any interest in this Agreement without the prior written consent of
each Lender.

Section 10.06 Lender Assignments and Participations.

(a) Assignments. Any Lender may assign to one or more banks or other entities
all or any portion of its rights and obligations under this Agreement
(including, without limitation, all or a portion of its Commitments, the
Advances owing to it, the Notes (if applicable) held by it, and the
participation interest in the Letter of Credit Obligations held by it);
provided, however, that:

(i) each such assignment shall be of a constant, and not a varying, percentage
of all of such Lender’s rights and obligations under this Agreement for a
particular Class and shall involve a ratable assignment of such Lender’s
Commitment and Advances for a particular Class,

(ii) the amount of the resulting Commitments and Advances of the assigning
Lender (unless it is assigning all its Commitments and Advances) and the
assignee Lender pursuant to each such assignment (determined as of the date of
the Assignment and Acceptance with respect to such assignment) shall in no event
be less than $1,000,000 in total, shall in no event be less than $100,000 for
each Class assigned and shall be an integral multiple of $100,000; provided that
with respect to assignments of Term Advances by a Lender to an Approved Fund, a
Related Fund, a Lender or an Affiliate of a Lender only, the amount of the
resulting Term Advances for the assigning Approved Fund and any such assignee
may be for less than $1,000,000; provided that except as approved by the
Administrative Agent such Approved Fund and all of its Related Funds shall only
be entitled collectively to one notice for all purposes under the Credit
Documents,

(iii) each such assignment shall be to an Eligible Assignee,

(iv) the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance, and, if applicable, deliver the Notes subject to such
assignment,

(v) if such assignment is of Term Advances and/or Term Commitments and is not to
a Lender, an Affiliate of a Lender, an Approved Fund or a Related Fund, then the
Administrative Agent shall consent to such assignment, which consent shall not
be unreasonably withheld or delayed,

(vi) if such assignment is of Revolving Advances and/or Revolving Commitments
and is not to a Lender with a Revolving Commitment or an Affiliate of a Lender
with a Revolving Commitment, then the Administrative Agent and each Issuing Bank
shall consent to such assignment, which consent shall not be unreasonably
withheld or delayed, and

(vii) each Eligible Assignee (other than an Eligible Assignee which is an
Affiliate of the assigning Lender) shall pay to the Administrative Agent a
$3,500 administrative fee; provided that, in the case of contemporaneous
assignments by a Lender to more than one Related Fund (which Related Funds are
not then Lenders hereunder), only a single $3,500 such fee shall be payable for
all such contemporaneous assignments.

Upon such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Acceptance, which effective date
shall be at least three Business Days after the execution thereof or earlier
such earlier date as agreed to by the Administrative Agent, (A) the assignee
thereunder shall be a party hereto for all purposes and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender hereunder
and (B) such Lender thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or the remaining
portion of such Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto). Notwithstanding anything herein to the
contrary, (i) any Lender may assign or pledge, as collateral or otherwise, any
of its rights under the Credit Documents to any Federal Reserve Bank and (ii)
any Lender that is an Approved Fund or Related Fund may, without the consent of
the Administrative Agent or the Borrower, pledge all or any portion of its
Advances and Notes (if applicable) to any trustee for, or any other
representative of, holders of obligations owed, or securities issued, by such
Approved Fund or Related Fund, as security for such obligations or securities;
provided that (A) any foreclosure or similar action by such trustee or
representative shall be subject to the provisions of this Section 10.06(a)
concerning assignments, including without limitation the requirement that any
assignee of such Notes (if applicable) and Advances must qualify as an Eligible
Assignee and (B) such Lender shall not require such trustee’s or
representative’s consent to any matter under this Agreement, except (1) for a
change in the principal amount of any Advances which has been so pledged,
reductions in fees or interest, or extending the Maturity Date except as
permitted in this Agreement or (2) as otherwise consented to by the
Administrative Agent.

(b) Term of Assignments. By executing and delivering an Assignment and
Acceptance, the Lender thereunder and the assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency of
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
Guarantors or the performance or observance by the Borrower or the Guarantors of
any of their obligations under this Agreement or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Sections 4.05 and 5.05, if applicable, and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (iv) such
assignee will, independently and without reliance upon the Administrative Agent,
such Lender or any other Lender and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under this Agreement; (v) such assignee appoints
and authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement as are delegated to the
Administrative Agent by the terms hereof, together with such powers as are
reasonably incidental thereto; and (vi) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of this Agreement are required to be performed by it as a Lender.

(c) The Register. The Administrative Agent shall maintain at its address
referred to in Section 10.02 a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names and
addresses of the Lenders and the Commitments of, and principal amount of the
Advances owing to, each Lender from time to time (the “Register”). The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Administrative Agent, the Issuing Banks,
and the Lenders may treat each Person whose name is recorded in the Register as
a Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.

(d) Procedures. Upon its receipt of an Assignment and Acceptance executed by a
Lender and an Eligible Assignee, together with, if applicable, any Note or Notes
subject to such assignment, the Administrative Agent shall, if such Assignment
and Acceptance has been completed and is in substantially the form of the
attached Exhibit C, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register, and (iii) give prompt notice
thereof to the Borrower. If requested by the assigning Lender or such Eligible
Assignee, within five Business Days after its receipt of such notice, the
Borrower, at its own expense, shall execute and deliver to the Administrative
Agent in exchange for the surrendered Note or Notes, a new Note or Notes payable
to the order of such Eligible Assignee in amount equal to, respectively, the
Commitments and the outstanding Advances assumed by it pursuant to such
Assignment and Acceptance, and if the assigning Lender has retained any
Commitments hereunder, a new Note or Notes payable to the order of such Lender
in an amount equal to, respectively, the Commitments and the outstanding
Advances retained by it hereunder. Any such new Notes shall be dated the date of
the original Notes executed pursuant to this Agreement and shall otherwise be in
substantially the form of the attached Exhibits A-1 or A-2, as applicable.

(e) Participations. Each Lender may sell participations to one or more banks or
other entities in or to all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its
Commitments, the Advances owing to it, its participation interest in the Letter
of Credit Obligations, and the Notes (if applicable) held by it); provided,
however, that (i) such Lender’s obligations under this Agreement (including,
without limitation, its Commitments to the Borrower hereunder) shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) such Lender shall remain
the holder of any such Advances (and, if applicable, such Notes) for all
purposes of this Agreement, (iv) the Borrower, the Administrative Agent, and the
Issuing Banks and the other Lenders shall continue to deal solely and directly
with such Lender in connection with such Lender’s rights and obligations under
this Agreement, and (v) such Lender shall not require the participant’s consent
to any matter under this Agreement, except for change in the principal amount of
any Advance in which the participant has an interest, reductions in fees or
interest, or extending the Maturity Date except as permitted in this Agreement.
The Borrower hereby agrees that participants shall have the same rights under
Sections 2.08, 2.09, 2.11(c), and 10.07 hereof as the Lender to the extent of
their respective participations.

(f) Confidentiality. Each Lender agrees to preserve the confidentiality of any
confidential information relating to the Parent, the Borrower and their
respective Subsidiaries received by Lender; provided that (i) each Lender may
furnish any such confidential information in the possession of such Lender from
time to time to (A) assignees and participants (including prospective assignees
and participants), (B) its attorneys, accountants, regulators, the National
Association of Insurance Commissioners, governmental authorities and any
self-governing organization to which is a member, (C) any direct or indirect
contractual counterparty to such Lender in swap agreements or such contractual
counterparty’s professional advisor, and (D) the Related Funds, Affiliates,
directors, partners, officers, employees, trustees, agents, advisors, or
pledgees of such Person or its Affiliates or Related Funds; provided that, prior
to any such disclosure, such Person shall agree in writing to preserve the
confidentiality of any confidential information relating to the Borrower and its
Subsidiaries received by it from or on behalf of such Lender, (ii) each Lender
may disclose such confidential information as required by law, regulation or
judicial order, and (iii) a Lender’s obligations with respect to confidential
information shall not apply to information which is or becomes available to the
public other than through an act of such Lender.

Section 10.07 Indemnification. The Borrower shall indemnify the Administrative
Agent, the Lenders (including any lender which was a Lender hereunder prior to
any full assignment of its Commitment), any assignees and participants permitted
hereunder, the Issuing Banks, and each affiliate thereof and their respective
directors, officers, employees, agents, trustees and advisors from, and
discharge, release, and hold each of them harmless against, any and all losses,
liabilities, claims or damages to which any of them may become subject, insofar
as such losses, liabilities, claims or damages arise out of or result from
(i) any actual or proposed use by the Borrower or any Affiliate of the Borrower
of the proceeds of any Advance, (ii) any breach by the Borrower or any Guarantor
of any provision of this Agreement or any other Credit Document, (iii) any
investigation, litigation or other proceeding (including any threatened
investigation or proceeding) relating to the foregoing, or (iv) any
Environmental Claim or requirement of Environmental Laws concerning or relating
to the present or previously-owned or operated properties, or the operations or
business, of the Borrower or any of its Subsidiaries, and the Borrower shall
reimburse the Administrative Agent, Issuing Bank, and each Lender, and each
affiliate thereof and their respective directors, officers, employees and
agents, upon demand for any reasonable out-of-pocket expenses (including legal
fees) incurred in connection with any such investigation, litigation or other
proceeding; and expressly including any such losses, liabilities, claims,
damages, or expense incurred by reason of such indemnified Person’s own
negligence, but excluding any such losses, liabilities, claims, damages or
expenses that are determined by a court of competent jurisdiction by a final and
non-appealable judgment to have resulted from the gross negligence or willful
misconduct of the Person to be indemnified.

Section 10.08 Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.

Section 10.09 Survival of Representations, Indemnifications, etc. All
representations and warranties contained in this Agreement or made in writing by
or on behalf of the Borrower in connection herewith shall survive the execution
and delivery of this Agreement and the Credit Documents, the making of the
Advances and any investigation made by or on behalf of the Lenders, none of
which investigations shall diminish any Lender’s right to rely on such
representations and warranties. All obligations of the Borrower provided for in
Sections 2.08, 2.09, 2.11(c), and 10.07 and the obligations of the Lenders under
Section 9.05 shall survive any termination of this Agreement and repayment in
full of the Obligations.

Section 10.10 Severability. In case one or more provisions of this Agreement or
the other Credit Documents shall be invalid, illegal or unenforceable in any
respect under any applicable law, the validity, legality and enforceability of
the remaining provisions contained herein or therein shall not be affected or
impaired thereby.

Section 10.11 Usury Not Intended. It is the intent of the Borrower and each
Lender in the execution and performance of this Agreement and the other Credit
Documents to contract in strict compliance with applicable usury laws, including
conflicts of law concepts, governing the Advances of each Lender including such
applicable laws of the State of New York and the United States of America from
time to time in effect. In furtherance thereof, the Lenders and the Borrower
stipulate and agree that none of the terms and provisions contained in this
Agreement or the other Credit Documents shall ever be construed to create a
contract to pay, as consideration for the use, forbearance or detention of
money, interest at a rate in excess of the Maximum Rate and that for purposes
hereof “interest” shall include the aggregate of all charges which constitute
interest under such laws that are contracted for, charged or received under this
Agreement; and in the event that, notwithstanding the foregoing, under any
circumstances the aggregate amounts taken, reserved, charged, received or paid
on the Advances, include amounts which by applicable law are deemed interest
which would exceed the Maximum Rate, then such excess shall be deemed to be a
mistake and each Lender receiving same shall credit the same on the principal of
its Advances (or if such Advances shall have been paid in full, refund said
excess to the Borrower). In the event that the maturity of the Advances is
accelerated by reason of any election of the holder thereof resulting from any
Event of Default under this Agreement or otherwise, or in the event of any
required or permitted prepayment, then such consideration that constitutes
interest may never include more than the Maximum Rate and excess interest, if
any, provided for in this Agreement or otherwise shall be canceled automatically
as of the date of such acceleration or prepayment and, if theretofore paid,
shall be credited on the applicable Advances (or, if the applicable Advances
shall have been paid in full, refunded to the Borrower). In determining whether
or not the interest paid or payable under any specific contingencies exceeds the
Maximum Rate, the Borrower and the Lenders shall to the maximum extent permitted
under applicable law amortize, prorate, allocate and spread in equal parts
during the period of the full term of the Advances all amounts considered to be
interest under applicable law at any time contracted for, charged, received or
reserved in connection with the Obligations. The provisions of this Section
shall control over all other provisions of this Agreement or the other Credit
Documents which may be in apparent conflict herewith.

Section 10.12 GOVERNING LAW. THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS SHALL
BE GOVERNED BY, CONSTRUED AND ENFORCED, AND ANY DISPUTE BETWEEN THE BORROWER,
THE ADMINISTRATIVE AGENT, ANY LENDER, OR ANY INDEMNITEE ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
BETWEEN THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER CREDIT
DOCUMENTS, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE
RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING, WITHOUT LIMITATION,
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO
THE CONFLICTS OF LAWS PROVISIONS) OF THE STATE OF NEW YORK; PROVIDED THAT THE
PERFECTION OF THE LIENS OF THE ADMINISTRATIVE AGENT ON THE COLLATERAL AND THE
EXERCISE OF REMEDIES AGAINST THE COLLATERAL SHALL BE GOVERNED BY, CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE APPLICABLE JURISDICTION.

Section 10.13 CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL.

(A) EXCLUSIVE JURISDICTION. EXCEPT AS PROVIDED IN SUBSECTION (B), EACH OF THE
PARTIES HERETO AGREES THAT ALL DISPUTES AMONG THEM ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN
CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS WHETHER
ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED EXCLUSIVELY
BY STATE OR FEDERAL COURTS LOCATED IN THE CITY AND COUNTY OF NEW YORK, STATE OF
NEW YORK, BUT THE PARTIES HERETO ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS
MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF NEW YORK, NEW YORK. EACH OF
THE PARTIES HERETO WAIVES IN ALL DISPUTES BROUGHT PURSUANT TO THIS SUBSECTION
(A) ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE
DISPUTE.

(B) OTHER JURISDICTIONS. THE BORROWER AGREES THAT ANY AGENT, ANY LENDER OR ANY
INDEMNITEE SHALL HAVE THE RIGHT TO PROCEED AGAINST THE BORROWER OR ITS PROPERTY
IN A COURT IN ANY LOCATION TO ENABLE SUCH PERSON TO (1) OBTAIN PERSONAL
JURISDICTION OVER THE BORROWER OR (2) ENFORCE A JUDGMENT OR OTHER COURT ORDER
ENTERED IN FAVOR OF SUCH PERSON. THE BORROWER AGREES THAT IT WILL NOT ASSERT ANY
PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING BROUGHT BY SUCH PERSON TO ENFORCE A
JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH PERSON. THE BORROWER WAIVES ANY
OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN WHICH SUCH PERSON HAS
COMMENCED A PROCEEDING DESCRIBED IN THIS SUBSECTION (B).

(C) SERVICE OF PROCESS. THE BORROWER WAIVES PERSONAL SERVICE OF ANY PROCESS UPON
IT AND IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY WRITS, PROCESS OR
SUMMONSES IN ANY SUIT, ACTION OR PROCEEDING BY THE MAILING THEREOF BY ANY AGENT
OR THE LENDERS BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE BORROWER
ADDRESSED AS PROVIDED HEREIN. NOTHING HEREIN SHALL IN ANY WAY BE DEEMED TO LIMIT
THE ABILITY OF ANY AGENT OR THE LENDERS TO SERVE ANY SUCH WRITS, PROCESS OR
SUMMONSES IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW. THE BORROWER
IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING, WITHOUT LIMITATION, ANY OBJECTION
OF THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH
RESPECT TO THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT
EXECUTED OR DELIVERED IN CONNECTION HEREWITH IN ANY JURISDICTION SET FORTH
ABOVE.

(D) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY
RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED
IN CONNECTION HEREWITH. EACH OF THE PARTIES HERETO AGREES AND CONSENTS THAT ANY
SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY AND THAT ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A
COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

(E) WAIVER OF BOND. THE BORROWER WAIVES THE POSTING OF ANY BOND OTHERWISE
REQUIRED OF ANY PARTY HERETO IN CONNECTION WITH ANY JUDICIAL PROCESS OR
PROCEEDING TO REALIZE ON THE COLLATERAL ENFORCE ANY JUDGMENT OR OTHER COURT
ORDER ENTERED IN FAVOR OF SUCH PARTY, OR TO ENFORCE BY SPECIFIC PERFORMANCE,
TEMPORARY RESTRAINING ORDER, PRELIMINARY OR PERMANENT INJUNCTION, THIS AGREEMENT
OR ANY OTHER CREDIT DOCUMENT.

(F) ADVICE OF COUNSEL. EACH OF THE PARTIES REPRESENTS TO EACH OTHER PARTY HERETO
THAT IT HAS DISCUSSED THIS AGREEMENT AND, SPECIFICALLY, THE PROVISIONS OF THIS
SECTION 10.13 AND SECTION 10.20, WITH ITS COUNSEL.

Section 10.14 Knowledge of Borrower. For purposes of this Agreement, “knowledge
of the Borrower” means the actual knowledge of any of the executive officers and
all other Responsible Officers of the Parent.

Section 10.15 Lenders Not in Control. None of the covenants or other provisions
contained in the Credit Documents shall or shall be deemed to, give the Lenders
the rights or power to exercise control over the affairs and/or management of
the Borrower, any of its Subsidiaries or any Guarantor, the power of the Lenders
being limited to the right to exercise the remedies provided in the Credit
Documents; provided, however, that if any Lender becomes the owner of any
Ownership Interests in any Person, whether through foreclosure or otherwise,
such Lender shall be entitled (subject to requirements of law) to exercise such
legal rights as it may have by being owner of such Ownership Interests in such
Person.

Section 10.16 Headings Descriptive. The headings of the several Sections and
paragraphs of the Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.

Section 10.17 Time is of the Essence. Time is of the essence under the Credit
Documents.

Section 10.18 Lender Interest Rate Agreements. As more fully set forth in the
Guaranty and the Security Agreement, if any Lender enters into an Interest Rate
Agreement with the Borrower or the Parent which is permitted by the provisions
of Section 5.12, the obligations of such Person to such Lender under such
Interest Rate Agreement shall (a) be pari passu with the Obligations and (b) be
secured by the Collateral pursuant to the Security Agreement.

Section 10.19 NO CONSEQUENTIAL DAMAGES. NOTWITHSTANDING ANYTHING CONTAINED TO
THE CONTRARY IN ANY OTHER PROVISION OF THIS AGREEMENT, EACH PERSON PARTY HERETO
FOR ITSELF AND ON BEHALF OF ITS AFFILIATES AGREES THAT THE RECOVERY OF ANY
DAMAGES SUFFERED OR INCURRED AS A RESULT OF ANY BREACH BY ANY PERSON OF ANY OF
ITS REPRESENTATIONS, WARRANTIES OR OBLIGATIONS UNDER THIS AGREEMENT OR ANY OTHER
CREDIT DOCUMENT SHALL BE LIMITED TO THE ACTUAL DAMAGES SUFFERED OR INCURRED AS A
RESULT OF THE BREACH BY THE BREACHING PARTY OF ITS REPRESENTATIONS, WARRANTIES
OR OBLGIATIONS HEREUNDER OR UNDER ANY OTHER CREDIT DOCUMENT AND IN NO EVENT
SHALL THE BREACHING PARTY BE LIABLE TO ANY NON-BREACHING PARTY FOR ANY INDIRECT,
CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES (INCLUDING, WITHOUT
LIMITATION, ANY DAMAGES ON ACCOUNT OF LOST PROFITS OR OPPORTUNITIES OR LOST OR
DELAYED PRODUCTION) SUFFERED OR INCURRED BY THE NON-BREACHING PARTY AS A RESULT
OF THE BREACH BY THE BREACHING PARTY OF ANY OF ITS REPRESENTATIONS, WARRANTIES
OR OBLIGATIONS HEREUNDER OR UNDER ANY OTHER CREDIT DOCUMENT.

Section 10.20 USA PATRIOT Act Notice. Each Lender and the Administrative Agent
(for itself and not on behalf of any Lender) hereby notifies the Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”), it is required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will
allow such Lender or the Administrative Agent, as applicable, to identify the
Borrower in accordance with the Act.

Section 10.21 Reliance on Professional Advisors. It is expressly understood and
agreed that neither the Administrative Agent, nor any Lender, nor any of their
respective Affiliates is undertaking to provide the Borrower or any of its
Affiliates with any advice relating to legal, regulatory, accounting, or tax
matters. In furtherance thereof, the Borrower acknowledges and agree that (a) it
and its Affiliates have relied and will continue to rely on the advice of its
and their own legal, regulatory, accounting and tax advisors for all matters
relating to the Credit Documents, the Obligations and otherwise and (b) neither
it, nor any of its Affiliates, has received, or has relied upon, the advice of
the Administrative Agent, or any Lender or any of their respective affiliates or
advisors regarding matters of law (including securities law), regulation,
accounting or taxation.

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[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
SIGNATURE PAGE OF AMENDED AND RESTATED
SENIOR SECURED CREDIT AGREEMENT

EXECUTED as of the date first referenced above.

BORROWER:

INTERSTATE OPERATING COMPANY, L.P.

      By: Interstate Hotels & Resorts, Inc., its general partner

By:

Name:

Title:

8

SIGNATURE PAGE OF AMENDED AND RESTATED
SENIOR SECURED CREDIT AGREEMENT

SOCIÉTÉ GÉNÉRALE, individually as a Lender and as Administrative Agent and the
Issuing Bank

By:

Thomas K. Day

Managing Director

9

SIGNATURE PAGE OF AMENDED AND RESTATED
SENIOR SECURED CREDIT AGREEMENT

By:
Name:

Title:

10