Exhibit 10.2

HOTEL MANAGEMENT AGREEMENT

Between

TRS MCO VILLAGE, LLC

and

PEACHTREE HOSPITALITY MANAGEMENT, LLC

Dated

June 19, 2017

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TABLE OF CONTENTS

Page

HOTEL MANAGEMENT AGREEMENT
1
ARTICLE 1
DEFINITIONS 
1
Section 1.01.
Definitions.
1
ARTICLE 2
TERM OF AGREEMENT 
10
Section 2.01.
Operating Term. 
10
ARTICLE 3
OPERATION OF THE HOTEL 
11
Section 3.01.
Representations by Lessee and Operator; Engagement of Operator. 
11
Section 3.02.
Standards of Operation. 
11
Section 3.03
Limitations on Operator's Authority 
14
Section 3.04.
Reservations Services and Revenue Management. 
16
Section 3.05.
Marketing
16
Section 3.06.
Consultations Between Lessee and Operator.
17
Section 3.07.
Transactions with Affiliates and Other Relationships.
17
Section 3.08.
Regional Manager.
17
Section 3.09.
Certain Expenses.
17
ARTICLE 4
INDEPENDENT CONTRACTOR
18
Section 4.01.
Operator Status.
18
Section 4.02.
Employees.
18
Section 4.03.
Employee Expenses.
19
Section 4.04.
Employee Benefit Plans.
19
Section 4.05.
Execution of Agreements.
20
ARTICLE 5
INDEMNIFICATION
20
Section 5.01.
Indemnification by Operator.
20
Section 5.02.
Limitations on Indemnification.
21
Section 5.03.
Indemnification by Lessee.
21
Section 5.04.
Survival of Indemnity.
22
ARTICLE 6
BUDGETS AND POLICY MEETINGS
22
Section 6.01.
Budgets.
22
Section 6.02.
Budget Meetings.
23
ARTICLE 7
OPERATING EXPENSES
23
Section 7.01.
Payment of Operating Expenses.
23
Section 7.02.
Operating Expenses Not an Obligation of Operator.
24
ARTICLE 8
BANK ACCOUNTS
24
Section 8.01.
Lessee Revenue Account.
24
Section 8.02.
Operating Account
24
Section 8.03.
Ownership of Accounts
25
Section 8.04.
Exculpation of Operator
25
Section 8.05.
Reimbursement of Operator
25
Section 8.06.
Working Capital Funds
25
ARTICLE 9
BOOKS, RECORDS AND STATEMENTS
26
Section 9.01.
Books and Records.
26
Section 9.02.
Statements.
26
ARTICLE 10
OPERATOR'S FEE AND TRANSFERS TO LESSEE
27
Section 10.01.
Payment of Operator's Fee.
27
ARTICLE 11
REPAIRS AND MAINTENANCE
28
ARTICLE 12
INSURANCE
28
Section 12.01.
General.
28
Section 12.02.
Workers' Compensation and Other Employment Insurance.
28
Section 12.03.
Approval of Companies and Cost by Lessee.
28
Section 12.04.
Maintenance of Coverages.
29
Section 12.05.
Waiver of Subrogation.
29
Section 12.06.
Blanket Coverage.
29
Section 12.07.
Employment Practice Liability
29
Section 12.08.
Cyber/Network/Privacy Liability.
29
Section 12.09.
Liquor Liability.
30
Section 12.10.
Automobile Liability.
30
Section 12.11.
General Liability.
30
Section 12.12.
Property.
30
Section 12.13.
Crime.
30
ARTICLE 13
PROPERTY TAXES, LOCAL TAXES, LEVIES AND OTHER ASSESSMENTS
31
Section 13.01.
Property Taxes.
31
Section 13.02.
Lessee's Right to Contest.
31
ARTICLE 14
DAMAGE OR DESTRUCTION - CONDEMNATION
31
Section 14.01.
Damage.
31
Section 14.02.
Condemnation.
31
ARTICLE 15
USE OF NAME
32
ARTICLE 16
TERMINATION
32
Section 16.01.
Inspection Failure.
32
Section 16.02.
Performance Failure.
32
Section 16.03.
Sale of Hotel.
33
Section 16.04.
Bad Acts
33
Section 16.05.
Optional Termination.
34
Section 16.06.
Lessee Change of Control.
34
Section 16.07.
Operator Change of Control.
35
Section 16.08.
Bookings Beyond Expiration of Term
37
Section 16.09.
Tax Law Change.
37
Section 16.10.
Default or Termination of Concession and Lease Agreement
37
Section 16.11.
Termination Fees.
37
ARTICLE 17
DEFAULT AND REMEDIES
38
Section 17.01.
Events of Default- Remedies.
38
Section 17.02.
Rights Not Exclusive.
39
ARTICLE 18
NOTICES
40
Section 18.01.
Notices.
40
ARTICLE 19
ASSIGNMENT
41
Section 19.01.
No Assignment by Operator.
41
Section 19.02.
Assignment by Lessee.
41
ARTICLE 20
SUBORDINATION
41
Section 20.01.
Subordination To Mortgage.
41
Section 20.02.
Foreclosure.
42
Section 20.03.
Estoppel Certificates.
42
ARTICLE 21
MISCELLANEOUS
42
Section 21.01.
Further Documentation and Reporting Compliance.
42
Section 21.02.
Captions.
42
Section 21.03.
Successors and Assigns.
43
Section 21.04.
Competitive Market Area.
43
Section 21.05.
Assumption of Post Termination Obligations.
43
Section 21.06.
Entire Agreement.
43
Section 21.07.
Governing Law.
44
Section 21.08.
No Political Contributions.
44
Section 21.09.
Eligible Independent Contractor.
44
Section 21.10.
Time of the Essence.
45
Section 21.11.
Offsets.
45
Section 21.12.
Attorney's Fees
45
Section 21.13.
Final Accounting.
45
Section 21.14.
Franchisor Communications.
46

LIST OF EXHIBITS

EXHIBIT A – Hotel and Owner

EXHIBIT A-1 – Competitive Set for Hotel

EXHIBIT A-2 – Accounting Software and Payroll Processes

EXHIBIT A-3 – List of Operator's Hotels Within 3-Mile Radius

EXHIBIT A-4 – 3-Mile Radius Restrictions Map for Hotel

EXHIBIT B – Franchise Agreement for Hotel

EXHIBIT C – Form of Approved Budget

EXHIBIT D – Approved Budget (if finalized)

EXHIBIT E – Example Incentive Fee Calculation

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HOTEL MANAGEMENT AGREEMENT
This HOTEL MANAGEMENT AGREEMENT is made and entered into effective as of June
19, 2017, by and among TRS MCO VILLAGE, LLC ("Lessee") and PEACHTREE HOSPITALITY
MANAGEMENT, LLC ("Operator"), with reference to the following facts:
A. Lessee leases from the entity described on Exhibit A ("Owner" ) the hotel
property described on Exhibit A ("Hotel") pursuant to the Master Lease Agreement
dated June  19, 2017 (the "Lease");
B. Lessee desires to engage Operator to operate and manage the Hotel listed on
Exhibit A beginning on the Commencement Date in accordance with the terms of
this Agreement;
C. Operator desires to supply the services and to operate the Hotel(s) beginning
on the Commencement Date in accordance with the terms of this Agreement; and
NOW, THEREFORE, for and in consideration of the mutual covenants, conditions,
stipulations, agreements and obligations hereinafter set forth and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties hereto, Lessee and Operator covenant and agree as
follows:
ARTICLE 1 

DEFINITIONS
Section 1.01. Definitions.
(a) As used herein, the following terms shall have the indicated meanings:
"Accounting Fee" shall mean an accounting fee in the amount of $1,500.00 per
month; provided, however, that within ninety (90) days following Commencement
Date, Operator shall (i) assign one staff accountant to all hotel properties
owned by Lessee or Lessee's Affiliates and managed by Operator; and (ii) such
staff accountant will not be assigned by Operator to more than seven (7) hotel
properties managed by Operator in any monthly cycle.  In the event the
conditions set forth in the foregoing sentence are not met, Operator and Lessee
acknowledge and agree that Accounting Fee shall be set at $1,000 through the
remainder of the Term.  The Accounting Fee shall be subject to adjustment
annually as may be approved by Lessee and Operator.
"Adjusted Operating Expenses" shall mean Operating Expenses excluding Operator's
Fee, insurance premiums (with the exception of the insurance described in
Section 12.02), discretionary employee bonuses (to the extent exclusion is
approved by Lessee), and Property real estate and personal property taxes.
"Affiliate" shall mean (a) any person that, directly or indirectly, controls or
is controlled by or is under common control with such person, (b) any person
that owns, beneficially, directly or indirectly, ten percent (10%) or more of
the outstanding capital stock, shares or equity interests of such person, or (c)
any officer, director, employee, partner or trustee of such person or any person
controlling, controlled by, or under common control with such person.
"Agreement" shall mean this Hotel Management Agreement and all amendments,
modifications, supplements, consolidations, extensions and revisions to this
Hotel Management Agreement approved by Lessee and Operator.
"Approved Budget" shall mean the Operating Budget and the Hotel Capital Budget
prepared in accordance with Section 6.01 of this Agreement and approved in
writing by Lessee. See Exhibit C for Approved Budget Form.
"CPI" shall mean the Consumer Price Index, all items for All Urban Consumers,
published by the Bureau of Labor Statistics of the United States Department of
Labor as reported in The Wall Street Journal.
"Capital Improvements" will mean all expenditures for replacements,
substitutions and additions to Hotel and Hotel FF&E, which are required to be
capitalized in accordance with generally accepted accounting principles.
"Concession Agreement" shall refer to the Concession and Lease Agreement, dated
as of the date of the Hotel acquisition, by and between Lessee and Operator.
"Commencement Date" shall mean June 19, 2017.
"Competitive Set" for the Hotel means the hotels listed on Exhibit_A-1 attached
hereto, or such other hotels as may be reasonably agreed upon by Lessee and
Operator from time to time during the Term.  The Lessee and Operator shall
discuss at least once a year, and upon any major change to the Hotel or an
existing hotel in the Competitive Set, the composition of the Competitive Set.
Notwithstanding the foregoing to the contrary, the Competitive Set shall at all
times consist of hotels in the market areas that are most comparable to the
Hotel in quality, price, location and market (with due consideration given to
age, quality, size, amenities, amount of meeting space and business mix). Any
changes to a Hotel's Competitive Set must be approved by Lessee and Operator,
which approval will not be unreasonably withheld by either party.
"Event(s) of Default" shall mean one or more of the events or occurrences listed
in Section 17.01 of this Agreement.
"Fiscal Year" shall mean each twelve (12) month calendar year ending December 31
during the Operating Term, except that the first Fiscal Year and the last Fiscal
Year of the Operating Term may not be full calendar years.
"Force Majeure" shall mean interruptions in the operation of the Hotel (or in
the case of the hotels within the Competitive Set, to any such hotels) or any of
its essential services on account of an interruption in any one or more of the
utility services servicing the Hotel, or on account of act of God, , earthquake,
hurricane, flood, fire or other casualty, taking by eminent domain, civil
commotion, riot, mob violence, insurrection, malicious mischief, sabotage,
rebellion, act of public enemy, invasion, embargo, or any similar cause beyond
Operator's reasonable control, but excluding any changes in economic or market
conditions. For purpose of Force Majeure pertaining to one or more hotels within
the Competitive Set, the reference to the "Operator" means the respective
operator or manager under the Competitive Set hotel that is affected by the
interruption.

"Franchisor" shall mean the franchisor under the Franchise Agreement.
"Franchisor Agreement" shall mean the franchise license agreement held by Lessee
with respect to the Hotel as described in Exhibit B as it may be amended from
time to time.
"GAAP" shall mean generally accepted accounting principles and procedures in the
United States.
"Group Services" shall mean group benefits, services, and facilities generally
made
available by Operator at other properties owned or managed by Operator or its
Affiliates, including, where applicable, convention, business and
sales-promotion services; advertising and public relation services; centralized
reservation services; computerized management information services; educational
and training programs and facilities; central purchasing and procurement
services; employee benefits administration; payroll administration; and risk
management services which have been previously disclosed and approved by Lessee
within the Approved Budget, or is otherwise approved by Lessee. Group Services
does not include Operator's central office overhead and general office and
administrative expenses (as opposed to that of the Hotel).

"Gross Hotel Income" shall mean all income and proceeds of sales received by
Operator for guest use, occupancy or enjoyment of the Hotel or for the sale of
any goods, services or other items sold on or provided from the Hotel to guests
in the ordinary course of the Hotel operation, but excluding the following: (i)
any excise, sales or use taxes or similar government charges collected directly
from patrons or guests, or as a part of the sales price of any goods, services
or displays, such as gross receipts, admission, cabaret or similar or equivalent
taxes; (ii) receipts from condemnation awards or sales in lieu of or under
threat of condemnation; (iii) proceeds of insurance (other than proceeds from
business interruption insurance received by Lessee which shall be allocated by
Lessee to any applicable periods); (iv) proceeds of sales of capital assets,
furniture and Hotel Operating Equipment; (v) consideration received at the Hotel
for hotel accommodations, goods and services to be provided at other hotels
although arranged by, for or on behalf of, Operator; (vi) proceeds of any
financing; (vii) working capital provided by Lessee; (viii) any funds provided
by Lessee to Operator whether for Operating Expenses or otherwise; (ix) interest
income and fees, rents and other revenues from telecommunications tower or
similar leases or other leases or sub-leases of any part of the Property (x)
other income or proceeds resulting other than from guest use or occupancy of the
Hotel or the Property, or any part thereof, or other than from the sale of
goods, services or other items sold on or provided in connection with guest
services at the Hotel in the ordinary course of business; (xi) tips and service
charges actually paid to employees; (xii) interest on accounts; (xiii) value of
complimentary rooms and services; (xiv) revenues of subtenants, concessionaires,
and licensees, but rent and license fees paid to Lessee would be included.  The
parties intend that Gross Hotel Income shall be computed in a manner consistent
with "room rentals and other hotel services" computation of revenues on the
Parent's audited Consolidated Statements of Operations.
 "Holder" shall mean the holder of any Mortgage and the indebtedness secured
thereby, and such holder's successors and assigns.
"Hotel Capital Budget" shall mean the budget relating to capital expenditures at
the Hotel as described in Section 6.01.
"Hotel FF&E" shall mean the furniture, furnishings, wall coverings, fixtures and
hotel equipment for the Hotel and which includes equipment required for
operation of the kitchens, restaurants and laundry, office equipment, material
handling equipment, cleaning and engineering equipment and vehicles.
 "Hotel Standards" shall mean the standards established by the respective
Franchisor of the Hotel from time to time as well as those identified in Section
3.02.
"Hotel" shall mean the hotel property described in Exhibit A hereto.
"Incentive Fees" shall mean incentive compensation paid by Lessee to Operator
for performance above budgeted expectations, achievable to a maximum aggregate
payout of two percent (2%) of Gross Hotel Income. The following will trigger
Incentive Fee payouts:
(i)
Fiscal Year 1: Beginning Commencement Date through the remainder of the calendar
year, Lessee shall pay to Operator an amount equal to one percent (1%) of Gross
Hotel Income for such Fiscal Year if the Hotel achieves an IR of 9.25% to 9.749%
for such Fiscal Year. Lessee shall pay to Operator an additional amount equal to
one percent (1%) of Gross Hotel Income for such Fiscal Year if the Hotel
achieves an IR of 9.75% or higher for such Fiscal Year.

(ii)
Fiscal Year 2: Beginning January 1, 2018, Lessee shall pay to Operator an amount
equal to one percent (1%) of Gross Hotel Income for such Fiscal Year if the
Hotel achieves an IR of 9.75% to 10.249% for such Fiscal Year.  Lessee shall pay
to Operator an additional amount equal to one percent (1%) of Gross Hotel Income
for such Fiscal Year if the Hotel achieves an IR of 10.25% or higher for such
Fiscal Year.

For Year 1 and Year 2, all Incentive Fees will be paid annually based on the
standard Fiscal Year. All Incentive Fees will be paid the first of the month
after the respective Fiscal Year end profit and loss statements (P&L's) are
finalized and approved by Lessee.

(iii)
Fiscal Year 3: Beginning January 1, 2019 and continuing until the termination of
this Agreement, Lessee shall pay to Operator the following amounts, up to a
maximum aggregate payout of two percent (2%) of Gross Hotel Income:

a.
0.5% of Gross Hotel Income if the Hotel achieves budgeted NOI, provided the
incentive payout does not cause NOI to fall below budget.

b.
25% of any NOI in excess of budgeted NOI for the Hotel.

c.
If the Hotel has achieved its budgeted NOI, 25% of any Gross Hotel Income for
the Hotel in excess of budgeted Gross Hotel Income for the Hotel.

Note: Should the addition of the initial Incentive Fees lower the return below
the predetermined amount or percentage, the lower Incentive Fees, or no
Incentive Fee, shall be used as the final payment. See Exhibit E for Example
Incentive Fee Calculation for Fiscal Year 1 and 2.

Beginning Year 3, all Incentive Fees will be paid quarterly based on standard
operating quarters (1st Quarter includes months January through March; 2nd
Quarter includes April through June; 3rd Quarter includes July through September
and 4th Quarter includes October through December).  Additionally, all Incentive
Fees will be paid the first of the month after the respective quarters profit
and loss statements (P&L's) are finalized (i.e. 1st Quarter P&L's will be
finalized in April, so the first Incentive Fee payment will be paid May 1).
Furthermore, for purposes of Incentive Fee calculations, if the Hotel is sold
within a quarter, then the operating numbers used for incentive calculations
will be prior to the month in which it is sold (i.e. if the Hotel is sold
February 5th, its financial performance will only be used in January for that
quarter's calculations).

"Initial Term" shall have the meaning set forth in Section 2.01.
"IR" shall mean Investment Return, which shall be equal to the percentage
obtained by dividing a numerator equal to Gross Hotel Income less Operating
Expenses, all reserve for Hotel FF&E (as required by lenders, franchisors, but
in no event less than 4% of Gross Hotel Income) and any capital expenditures not
covered in any year by any Hotel FF&E Reserve by the total investment of Lessee
in the Hotel, including acquisition price, acquisition costs, not to exceed
$300,000.  Operating Expenses as referred to in this definition are inclusive of
any Incentive Fees earned related to the Fiscal Year.
"Land" shall mean the real property described in Exhibit A to the Lease.
"Lease" shall have the meaning set forth in the recitals.
"Legal Requirements" shall mean all laws, ordinances, statutes, regulations,
requirements, orders, notices and determinations of any federal, state,
municipal or other authority having jurisdiction over the Hotel now or hereafter
in effect, including but not limited to, environmental laws.

"Lessee" shall have the meaning set forth in the recitals.
"Lessee Revenue Account" shall mean the bank accounts opened and maintained in
Lessee's name, or in a name designated by Lessee, with a banking institution
selected by Lessee, into which all income, receipts and proceeds included in the
definition of Gross Hotel Income (without exclusion of any of the items excluded
from the definition of such term) shall be deposited.
"Marketing Plan" shall have the meaning set forth in Section 3.02(i).
"Mortgage" shall mean any deed to secure debt, mortgage or deed of trust, from
time to time, encumbering all or any portion of the Property, together with all
other instruments evidencing or securing payment of the indebtedness secured by
such deed to secure debt, mortgage or deed of trust and all amendments,
modifications, supplements, extensions, and revisions of such mortgage, deed of
trust and other instruments.
"NOI" shall mean Net Operating Income, which shall be determined by deducting
Adjusted Operating Expenses from Gross Hotel Income.
"Operating Account" shall mean the bank account opened and maintained in
Operator's name, or in a name designated by Operator, with a banking institution
selected by Lessee, from which disbursements shall be made pursuant to the terms
of this Agreement.
"Operating Budget" shall mean the budget relating to the operation of the Hotel
as described in Section 6.01.
"Operating Equipment" shall mean linens, chinaware, glassware, silverware,
uniforms, utensils and other non-consumable items of similar nature.
"Operating Expenses" shall mean all costs and expenses of maintaining,
conducting and supervising the operation of the Property, to the extent set
forth in an Approved Budget, incurred pursuant to this Agreement or as otherwise
specifically provided herein which are properly attributable to the period under
consideration under Lessee's system of accounting, including without limitation:
(i)
The cost of all food and beverages sold or consumed and of all Operating
Equipment and Operating Supplies;

(ii)
Salaries and wages of on-site Hotel personnel, including costs of payroll taxes
and employee benefits and amounts payable under bonus plans approved by Lessee.
The salaries or wages of other employees or executives of Operator, or any
Affiliate of Operator shall in no event be Operating Expenses;

(iii)
The cost of all other goods and services obtained by Operator in connection with
its operation of the Property including, without limitation, heat and utilities,
office supplies and all services performed by third parties, including leasing
expenses in connection with telephone and data processing equipment and such
other equipment as Lessee shall designate;

(iv)
The cost of repairs to and maintenance of the Property to keep the Property in
good condition;

(v)
Insurance premiums for all insurance maintained with respect to the Property,
including without limitation, property damage insurance, public liability
insurance, workers' compensation insurance or insurance required by similar
employee benefits acts, employment liability practices insurance, and such
business interruption or other insurance as may be provided for protection
against claim, liabilities and losses arising from the use and operation of the
Hotel and losses incurred with respect to deductibles applicable to the
foregoing types of insurance;

(vi)
All taxes, assessments and other charges (other than federal, state or local
income taxes and franchise taxes or the equivalent) payable by or assessed
against Operator or Lessee with respect to the operation of the Hotel, including
water and sewer charges;

(vii)
Legal fees relating to Hotel operations (excluding legal fees with respect to
employee claims), and real estate tax abatement and appeal services;

(viii)
The costs and expenses of technical consultants and specialized operational
experts for specialized services in connection with non-recurring work on
operational, functional, decorating, design or construction problems and
activities, including reasonable third party fees reasonably deemed necessary by
Lessee for the efficient operation of the Hotel;

(ix)
All expenses for marketing and sales, including all expenses of advertising,
sales promotion and public relations activities at the Hotel, exclusive of
Operator's marketing manager and similar administrative personnel (which
expenses shall be borne by Operator);

(x)
Municipal, county and state license and permit fees;

(xi)
All normal and recurring fees, assessments and charges due and payable under
Franchisor Agreement;

(xii)
Centralized services, which will include, but not be limited to, revenue
management, accounting, or other services approved in the operating budget;

(xiii)
Credit card fees, travel agent commissions and other third party reservation
fees and charges;

(xiv)
The cost of un-collectible accounts receivable as reasonably determined by
Operator pursuant to its standard policies, consistently applied, which standard
practices have been previously disclosed and approved by Lessee.

(xv)
All parking charges and parking rental fees and other expenses associated with
revenues received by the Hotel related to parking operations, including valet
services;

(xvi)
All expenses related to the revenues included in Gross Hotel Income, including
without limitation, expenses relating to telephone, vending, television, cable
television, pay television and similar services;

(xvii)
The costs of obtaining and keeping in force all licenses or permits (including
liquor licenses, if any) necessary for the operation of the Hotel and in
complying with governmental laws, rules, regulations, ordinances, orders and
requirements;

(xviii)
All reasonable travel expenses of Operator's supervisory personnel on the next
level above hotel manager, to include director of engineering, regional manager,
revenue manager and internal auditors (to the extent approved by Lessee) for
visits to the Hotel in the performance of their duties hereunder, but not
including travel between Operator's main office and Operator's regional offices.
Travel shall be limited to economy fares;

(xix)
The costs to send above property supervisory personnel to brand conferences,
which costs shall be reimbursed in proportion to the number of Lessee's hotels
associated with the brand conference out of Operator's total portfolio of hotels
managed associated with the specific brand conference. Such percentage of
reimbursable costs shall be pre-approved by Lessee prior to the date of the
conference;

(xx)
Other potential operating expenses which are budgeted for and approved by Lessee
provided they are disclosed in advance to Lessee's designated representative;

(xxi)
Operator's Fee, the Accounting Fee and the Revenue Management Fee, if any; and

(xxii)
The Hotel's portion of the cost of implementation and ongoing maintenance of any
Group Services so long as (i) the cost of the Group Services are without mark-up
and are allocated in good faith on a consistent, fair and equitable basis among
the Hotel, the Operator's corporate office, if applicable and other
Operator-managed hotels; and (ii) the cost of the Group Services are either (a)
itemized by Operator in each Approved Budget or otherwise approved in writing by
Lessee.

Operating Expenses shall not include (a) depreciation and amortization except as
otherwise provided in this Agreement; (b) debt service; (c) capital expenditures
per the Hotel Capital Budget; (d) lease payments to Lessee; and  (e) all costs,
expenses, salaries, wages or other compensation, and any recruitment costs, of
any corporate, regional or other headquarters/corporate level employees of
Operator, except to the extent such employees are assigned to the Hotel on a
temporary basis to fill a vacant Executive Staff position, in which case a fair
and equitable cost and expense of the foregoing shall constitute an Operating
Expense; (f) Any expenses of Operator's principal or branch offices; (g) Any
part of Operator's capital expenses; (h) Operator's overhead or general
expenses, including but not limited to duplicating, stationery and postage
expenses incurred at Operator's principal or branch offices, and Operator's own
fidelity, liability, errors and omissions and casualty insurance, except as may
be expressly assumed by Lessee pursuant to the terms of this Agreement; (i) Any
expenses for advertising or promotional materials that feature Operator's name
or activities but which do not promote the Hotel, unless and to the extent
approved in advance by Lessee to be an Operating Expense; (j) Any travel
expenses of Operator, other than those described in clause (xvi) of the
definition of Operating Expenses; (k) Any interest or penalty payment with
respect to an imposition or lien upon the Hotel imposed on Lessee by reason of
(1) the failure of Operator to make a payment required to be made by Operator
under this Agreement when the funds therefor were available, or (2) the funds
therefor were not available and Operator failed to so notify Lessee; provided,
however, that interest or penalty payments for the interest or penalty payments
incurred as a result of a good faith decision to contest the imposition or lien,
which could not be contested without incurrence thereof, shall be Operating
Expenses; (m) Any cost for which Operator is liable under any indemnification or
any other provision of this Agreement; and (n) Political or charitable
contributions made by Operator on its own behalf without Lessee's prior written
approval.
The parties intend that Operating Expenses shall be computed in a manner
consistent with "Hotel and property operations expenses" computation of expenses
on the Parent's Audited Consolidated Statements of Operations.
"Operating Loss" shall mean for any period the amount by which Operating
Expenses exceed Gross Hotel Income.
"Operating Supplies" shall mean paper supplies, cleaning materials and similar
consumable items.
"Operating Term" shall mean, with respect to any Hotel, the term of this
Agreement as set forth in Section 2.01.
"Operator" shall have the meaning set forth in the recitals.
"Operator's Fee" shall mean a monthly fee equal to 2.5% of Gross Hotel Income.
Upon delivery to Lessee by Operator of written notice that the conditions laid
out in Section 1.2(e) of the Purchase Agreement have been satisfied ("Contingent
Purchase Price Notice") and the Contingent Purchase Price (as defined in the
Purchase Agreement) is due and payable, the Operator's Fee shall increase to a
monthly fee equal to 3% of Gross Hotel Income beginning the next full month
immediately following the receipt of the Contingent Purchase Price Notice.
 "Owner" shall mean any entity described on Exhibit A as it may be amended from
time to time.
"Parent" shall mean Condor Hospitality Trust, Inc.
"Property" shall mean the Land, the Hotel, all real and personal property now or
hereafter situated upon the Land and all appurtenant rights and easements
thereto.
"Purchase Agreement" shall mean the Purchase and Sale Agreement between SI Lake
Mary, LP, a Georgia limited partnership and Condor Hospitality Limited
Partnership, a Virginia limited partnership, for the purchase and sale of the
Hotel, dated April 29, 2017.
"Renewal Term" shall have the meaning set forth in Section 2.01.
"Revenue Management Fee" shall mean a revenue management fee of $1,000.00 per
month; provided, however, such amount shall be subject to adjustment annually as
may be approved by Lessee and Operator.
"RevPAR" shall mean Hotel occupancy percentage multiplied by average daily rate.
"RevPAR Benchmark" means the Hotel's RevPAR Index for the trailing 12-months
ending on the Commencement Date.
"RevPAR Index" means the RevPAR Index included in the Smith Travel Research
Report ("STR Report").
"STR Report" shall mean Smith Travel Research Report produced for the Hotel by
Smith Travel Research or, if Smith Travel Research no longer is in existence,
the successor of Smith Travel Research or such other industry resource that is
equally as reputable as Smith Travel Research will be substituted, in order to
obtain substantially the same result as would be obtained if Smith Travel
Research has not ceased to be in existence.
"Unrelated Persons" shall have the meaning set forth in Section 21.09.
"Working Capital Amount" shall be $10,000, which will be distributed by Lessee
as necessary.
(b) Terms with initial capital letters which appear within the foregoing
definitions are defined in this Article 1 or as indicated in this Agreement. 
Dollars are denominated in U.S. Dollars.
ARTICLE 2 

TERM OF AGREEMENT
Section 2.01. Operating Term.
The term of this Agreement shall commence on the Commencement Date and shall
terminate at midnight on the date that is three (3) year term from the
Commencement Date (the "Initial Term"), subject to earlier termination or
extension as set forth herein.  This Agreement shall automatically renew for
additional two (2) terms of one (1) year each (each, a "Renewal Term") unless
either party gives the other party written notice of termination at least ninety
(90) days prior to the end of the Initial Term or the then-current Renewal Term.
ARTICLE 3 

OPERATION OF THE HOTEL
Section 3.01. Representations by Lessee and Operator; Engagement of Operator.
Lessee hereby represents and warrants that : (i) is a limited liability company
duly organized and existing under the laws of the State of Delaware, and is duly
qualified to do business in the State of Florida, (ii) has the full power and
authority to enter into this Agreement and to carry out the transactions herein
contemplated; and the undersigned officers of Lessee have all necessary
authority to execute and deliver this Agreement on behalf of Lessee, (iii) will
take all legally required action to maintain such qualification under the laws
of the State of Florida to remain in good standing as needed to conduct the
business herein contemplated, and (iv) any authorization or acts, which it does
or grants, are specifically authorized by the Owner under the Lease. Lessee
further covenants that Lessee shall notify Operator immediately if the Lease
terminates or is no longer in effect.
Operator hereby represents that Operator: (i) is a limited liability company
duly organized and existing under the laws of the State of Georgia, and is duly
qualified to do business in the State of Florida, (ii) has the full power and
authority to enter into this Agreement and to carry out the transactions herein
contemplated; and the undersigned officers of Operator have all necessary
authority to execute and deliver this Agreement on behalf of Operator, (iii)
will deliver to Lessee, upon the execution hereof (a) a good standing
certificate from the State of Florida showing that Operator is qualified to do
business in such State, and (b) an incumbency certificate and corporate
resolutions of Operator, authorizing the execution and delivery of this
Agreement, certified by an authorized officer of Operator as being true, correct
and complete, (iv) will take all legally required action to maintain such
qualification under the laws of the State of Florida to remain in good standing
as needed to conduct the business herein contemplated, (v) is experienced and
capable in the management and operation of the hotel in the regions it manages
hotels, (vi) has reviewed and understands the terms and provisions of the
Franchise Agreement and Hotel Standards, and (vii) will, on the effective date
of this Agreement, meet the requirements to be an "eligible independent
contractor" under Section 856(d)(9) of the Internal Revenue Code. In reliance on
the foregoing representations, Lessee hereby engages Operator to manage and
operate the Hotel during the Operating Term and Operator agrees to manage and
operate the Hotel during the Operating Term, in accordance with this Agreement.
Operator will provide all property management, financial accounting, reporting,
marketing and other operational services for the Hotel, including the services
of regional operations and regional sales support as necessary for the Hotel and
will use commercially reasonable efforts to maximize the operating profitability
thereof. Operator shall diligently pursue all commercially reasonable measures
to enable the Hotel to adhere to the Approved Budget.
Section 3.02. Standards of Operation.
Without limiting the generality of the foregoing, Operator's engagement under
this Agreement shall include the responsibility and authority (subject to the
limitations on Operator's authority set forth in this Agreement), to do the
following, at all times in material compliance with the Approved Budget, the
Franchise Agreement, the Lease Agreement, Mortgage, if any, Legal Requirements
and the Hotel Standard:
(a)
Train, supervise, discharge and determine and pay the compensation, fringe
benefits, 401(k) retirement plans and other policies and terms of employment of
all personnel as may be reasonably required to provide proper operation,
supervision, and management of the Hotel in a professional manner suitable to
the character of the Hotel;

(b)
Establish all prices, price schedules, rates and rate schedules for rooms, and
other amenities and services provided at or in connection with the Hotel;

(c)
Develop, revise, and implement policies and practices relating to  the operation
of the Hotel in accordance with this Agreement, which may be set forth in one or
more policy manuals or other writings, and train and supervise all Hotel
employees for compliance with all such policies and practices, including
policies and practices relating to:  (i) terms and conditions of employment,
applicant screening, background checks, selection, hiring, training,
supervision, compensation, employee benefits, discipline, dismissal, transfer
and replacement;  (ii) compliance with laws, including but not limited to
anti-discrimination, sexual harassment and environmental laws; and (iii) safety
procedures, including those relating to the handling of hazardous and other
dangerous materials;

(d)
Select, purchase and install all Inventories and Operating Equipment and
Supplies for the Hotel, and to the extent set forth in the Approved Budget, but
subject to the requirement to obtain Lessee's specific authorization for
expenditures in the Approved Budget as described herein.  Without limiting the
generality of the foregoing, Operator agrees to maintain the levels of
Inventories and Operating Supplies at standards consistent with past practice
and the requirements of the Operating Standard through the date of termination
of this Agreement, including the period after a notice of termination of this
Agreement has been given by Lessee or Operator;

(e)
Negotiate and enter into service contracts on Lessee's behalf which are
necessary or desirable in the ordinary course of business in operating the
Hotel, including, without limitation, contracts for provision of electricity,
gas, water, telephone and other utility services, cleaning services, security
services, vermin extermination, trash removal, elevator and boiler maintenance,
air conditioning maintenance, master television service, laundry and dry
cleaning, entertainment satellite systems and other services necessary for
operation of the Hotel in accordance with this Agreement.  Unless Lessee
otherwise elects, all such service contracts shall be entered into in the
Lessee's or Affiliate of Lessee's or the Hotel name;

(f)
Establish all credit and direct bill policies and ensure compliance with such,
in connection with the Hotel;

(g)
Apply for, and obtain and maintain in the name of Lessee or Operator, as
required by Legal Requirements and this Agreement, all Permits required of
Lessee or Operator in connection with the management and operation of the Hotel;

(h)
Institute and defend in the name of Operator or Lessee (or both), utilizing
legal counsel selected by Lessee, any and all legal actions or proceedings (i)
involving routine collection litigation and similar matters respecting ordinary
day-to-day operations of the Hotel where the amount in controversy is less than
$10,000; or (ii) which Lessee shall deem necessary or proper in connection with
the operation of the Hotel and requests Operator to institute or defend;

(i)
Establish, supervise and implement a sales and marketing program for the Hotel
consistent with the Marketing Plan (which Marketing Plan shall be submitted in
conjunction with the Operating Budget and approved by Lessee), and in
conjunction therewith, plan, prepare, arrange and contract for all advertising,
publicity and promotional activities for the Hotel, including advertising and
promotional activities in conjunction with other hotels owned, operated or
franchised by Operator and its Affiliates, and all discount and complimentary
policies with respect to bona fide travel agents, tourist officials, airline
representatives, and employees of Lessee, Lessor, Operator and their Affiliates
in accordance with the customary practices of the travel industry;

(j)
Engage such persons, as have been approved by Lessee (in Lessee's sole
discretion) for providing services of a specialist nature (such as legal counsel
and independent accountants) related to matters within Operator's responsibility
under this Agreement;

(k)
Perform (or cause to be performed and supervised) such routine maintenance and
repairs to the Hotel, at Lessee's sole cost and expense, as shall be required to
maintain the Hotel in all material respects in accordance with the Operating
Standard.  Without limiting the generality of the foregoing Operator agrees to
perform (or cause to be performed and supervised) all necessary or scheduled
repair and maintenance through the date of termination of this Agreement,
including the period after a notice of termination of this Agreement has been
given by Lessee or Operator. Operator's performance of its obligations set forth
in this paragraph are conditioned on Lessee making sufficient funds available to
Operator to perform its duties hereunder;

(l)
Perform any obligations of Lessee under the Lease Agreement and any Mortgage
which are applicable to the operation and management of the Hotel;

(m)
Pay all Operating Expenses, including but not limited to Impositions and
insurance premiums (whether for insurance maintained in accordance with this
Agreement by Lessee, Lessor or Operator);

(n)
Pay all gross receipts, transient occupancy and similar taxes;

(o)
Comply with all Legal Requirements and the requirements of insurance companies
which are applicable to the operation and management of the Hotel;

(p)
At any given time, the standards of equipping, maintaining, and operating the
Hotel at a level equal to the higher of the operating standards as established
by the Franchisor;

(q)
Operate and/or lease to third parties selected by Lessee gift and sundry shops,
concessions, food and beverage, banquet and room service facilities of the
Hotel, provided, that Lessee shall seek Operator's approval of any such lease,
including the form of lease, which approval which may be withheld only if
Operator can demonstrate that the third party operator is unable to manage the
space or facility in a manner consistent with the Operating Standard;

(r)
Do any and all other acts and things as Operator may deem necessary and
appropriate to carry out its responsibilities under this Agreement; and

(s)
Comply with the provisions of any covenants, conditions and restrictions
recorded against the Hotel.

Notwithstanding anything to the contrary in this Agreement, Operator's
performance of its obligations set forth in this Agreement are conditioned at
all times on Lessee and/or Owner's cooperation as may reasonably be required,
including providing information to Operator and making sufficient funds
available to Operator to perform its duties hereunder.  In no event shall
Operator be, or be deemed to be, in default of any provision of this Agreement
to the extent that Operator's failure to perform thereunder is due to Lessee
and/or Owner's failure to timely respond to information requests or to make
sufficient funds available to Operator therefore.
Section 3.03 Limitations on Operator's Authority
Operator shall have no authority to do any of the following without Lessee's
prior written approval in each instance, which may be withheld in Lessee's sole
and absolute discretion:
(a)  Borrow money, guaranty the debts of any third person, or mortgage, pledge,
grant a security interest in or otherwise encumber all or any part of the Hotel;
(b)  Enter into any lease for the use of any item of FF&E or other property;
(c) Enter into any agreement, lease, license or concession agreement for office,
retail, lobby or other commercial space at the Hotel;
(d) Incur any liabilities or obligations to third parties which are unrelated to
the operation, maintenance and security of the Hotel or to the performance of
Operator's responsibilities under this Agreement;
(e) Engage in collective bargaining with the bargaining representative or
representatives of Hotel employees, enter into collective bargaining agreements,
or modify or renew existing Union Agreements, or approve across-the-board wage
increases affecting any class of Hotel Employees;
(f) Enter into any contract or other arrangement (or series of related contracts
or arrangements) if (i) the contract or other arrangement would, or are
reasonably anticipated to, exceed $10,000 in the aggregate, (ii) the term of
such contract or other arrangement is in excess of one year, or (iii) the
contract or other arrangement is not terminable by Lessee or Operator without
payment or penalty upon not less than thirty (30) days' notice, or (iv) if the
contract is for the employment of any member of the Executive Staff or other
Hotel Employee;
(g) Settle any casualty and insurance claims which involve, or which are
reasonably estimated to involve, amounts in excess of $10,000, and any
condemnation awards regardless of amount;
(h) Institute or defend any Legal Proceedings with respect to the Hotel, other
than as required by Section 3.02 (h);
(i) Employ any professional firm for more than $10,000 in the aggregate except
as set forth in the Approved Budget, or enter into any arrangement for the
employment of any attorney or accountant;
(j) Prosecute or settle any tax claims or appeals;
(k) Purchase goods, supplies and services from itself or any Affiliate of
Operator, or enter into any other transaction with an Affiliate of Operator,
unless (i) such purchase from or other transaction with Operator or any
Affiliate of Operator is disclosed in the Approved Budget or (ii) prior to the
consummation of such transaction all of the prices and other terms thereof and
the identity of the vendor and its relationship to Operator shall have been
disclosed to and approved by Lessee, which may be withheld in Lessee's sole
discretion.  Lessee may require that the supplier of any goods, supplies or
services for the Hotel be selected through competitive bidding by qualified
independent third parties, with the transaction being awarded to the lowest
bidder.  Except to the extent disclosed to Lessee in advance and approved by
Lessee in its sole and absolute discretion, neither Operator nor any Affiliate
of Operator shall charge or receive any mark-up, profit or purchasing fee on the
purchase by or for the Hotel of any goods, supplies or services.  Operator shall
ensure that the prices and terms of goods and services purchased under such
contracts are competitive with the prices and terms of goods and services of
equal quality available from others.  Operator shall use its best efforts to
obtain the maximum available discounts and rebates on purchases and the most
favorable terms available.  Any allowances, credits, rebates, discounts and the
like received with respect to any such purchases shall be for the account of
Lessee, and if received by Operator or any of its Affiliates, shall be turned
over to Lessee;
(l) Provide no more than five (5) complimentary rooms or services in any
calendar quarter to any guests, employees or other persons except in accordance
with Operator's policies approved by Lessee or for which the business purpose
for the benefit of the Hotel is properly documented;
(m) Acquire on behalf of Lessee any land or any interest therein;
(n) Consent to any condemnation or participate in any condemnation proceeding
relating to the Hotel, the Site or any portion thereof;
(o) Sell, transfer or otherwise dispose of all or any portion of the Hotel or
any capital assets of the Hotel or other interest therein, except for
dispositions of FF&E to the extent expressly provided for in the Approved
Budget;
(p) Perform any alterations to the Hotel or any portion thereof except to the
extent Operator's performance of any such alteration shall be expressly provided
for in the Approved Budget;
(q) Take any other action which, under the terms of this Agreement, is
prohibited or requires the approval of Lessee; and
(r) Lease or rent any one or more of the Hotel's ballroom, bar or restaurant for
periods in excess of two (2) consecutive weeks.
Section 3.04. Reservations Services and Revenue Management.
The Operator agrees, if requested at any time by Lessee, and at the sole and
absolute discretion of Lessee, to hire either: a revenue manager on a corporate
or regional basis, or a revenue management firm to be selected by Lessee and
Operator, only if required by Franchisor (the "Revenue Manager"), to oversee the
implementation of the Hotel's ongoing revenue management plans, including (i)
interfacing with the Franchisor's reservation and revenue management systems,
and such Franchisor's "cluster" or other revenue manager(s) responsible for the
Hotel; (ii) interfacing on an ongoing basis with the Hotel's general manager and
front office manager (and/or other Hotel personnel responsible for revenue
management) to endeavor to maximize the Hotel's REVPAR; and (iii) analyzing all
STAR Reports, Hoteligence Reports, and other data.  In connection therewith, the
Lessee agrees to pay its equitable share of any individual hired as a Revenue
Manager for the Hotel, either to be shared between the Hotel and one or more
other hotels managed by the Operator, or to be hired on a part-time basis by the
Hotel, either of which salary and benefit expenses shall be paid for by the
Hotel as an Operating Cost. Alternatively, any revenue management firm so hired
to serve as Revenue Manager strictly for the Hotel shall be paid for by the
Hotel as an Operating Cost.
Section 3.05. Marketing.
(a) Operator shall maintain a sales staff dedicated to the Hotel to arrange,
contract for and carry out such marketing, advertising, national trade show
attendance, and promotion of the Hotel as Operator shall deem advisable and
consistent with the Approved Budget and in accordance with the Hotel Standards. 
Operator will make every effort to ensure that the Hotel shall receive an
equitable share of the benefit of the cooperative advertising and promotion
reasonably commensurate with its contribution to the costs thereof.  The costs
thereof shall be equitably allocated by Operator between the Hotel and other
participating hotels, subject to Lessee's prior written approval. Upon Lessee's
request, Operator shall provide reasonable documentation to support such
allocations.  Operator shall provide Lessee with detailed monthly reports of its
marketing, advertising and promotional activities through standard monthly
reporting.  The Hotel shall be visited at least once every three (3) months by a
member of Operator's sales leadership team if in Approved Budget.
(b) Operator may, consistent with the Approved Budget, and otherwise, with the
consent of Lessee, cause the Hotel to participate in sales and promotional
campaigns and activities involving complimentary rooms, food and beverages,
consistent with customary practices in the travel industry.  Operator shall not
provide rooms or Hotel facilities at no cash charge or at a discounted cash rate
in trade for non-cash consideration or services without the consent of Lessee.
Section 3.06. Consultations Between Lessee and Operator.
When requested by Lessee, Operator shall, from time to time, render advice and
assistance to Lessee and Owner in the negotiation and prosecution of all claims
for the reduction of real estate or other taxes or assessments affecting the
Hotel and for any award for taking by condemnation or eminent domain affecting
the Hotel.
Section 3.07. Transactions with Affiliates and Other Relationships.
(a) Operator shall obtain the prior written consent of Lessee (which Lessee may
withhold in Lessee's sole and absolute discretion) prior to contracting with any
Affiliate (or companies in which Operator has an ownership or other economic
interest if such interest is not sufficient to make such a company an Affiliate)
to provide goods and/or services to the Hotel.
(b) Prior to entering into any contract, agreement or arrangement with respect
to the Hotel pursuant to which Operator may receive rebates, credit card
rebates, cash incentives, administration fees, concessions, profit
participations, stock or stock options, investment rights or similar payments or
economic consideration from or in, as applicable, vendors or suppliers of goods
or services (collectively, "Rebates"), Operator shall promptly disclose to
Lessee in writing the fact of and the estimated amount of such Rebates, and the
charges and other amounts expected to be incurred in connection with any such
contracts or agreements (which shall not exceed prevailing market rates with
respect to such goods or services).  All Rebates associated with the Hotel will
accrue to the benefit of Lessee and will be applied against Operating Expenses.
Section 3.08. Regional Manager.
Operator shall provide the services of one of its experienced management
employees to oversee and manage the operations of the Hotel (the "Regional
Manager").  Lessee shall have the right to approve the Regional Manager and any
successor provided that such approval shall not be unreasonably withheld.  The
Regional Manager shall visit the Hotel at least every three (3) months to insure
the Hotel is being operated in accordance with this Agreement. The Regional
Manager shall meet telephonically with the designated representatives of Lessee
at least monthly to discuss operations at the Hotel and consult with Lessee to
answer any questions Lessee may have, and to address any concerns of Lessee. 
Lessee's representatives shall have the right to meet with the COO of Operator
or his/her mutually acceptable alternative on a semi-annual basis to review
hotel performance.
Section 3.09. Certain Expenses.
Operator shall not be entitled to charge Lessee for any of its costs and
expenses, except as follows:
(a) Operator shall not charge tuition for training courses provided by Operator
for employees employed at the Hotel or for course materials but shall be
reimbursed the cost of course materials developed by third party companies,
subject to approval in the Operating Budget.  Reasonable travel and housing
expenses of trainees shall be included in Operating Expenses, subject to
approval in the Operating Budget.
(b) Travel expenses described in (xvii) of "Operating Expenses" above.
Operator shall be solely responsible and shall reimburse Lessee for
re-inspection and/or penalty fees charged by Franchisors following a "failure"
or its equivalent in any quality inspection report or brand required score
standards unless the failure is for a Capital Improvement that has been
previously brought to the attention of the Lessee and Lessee has not corrected
at the time of the inspection or if the Operator has exceeded the required brand
guest service scores in which case the penalty fees will be paid by Lessee.
ARTICLE 4 

INDEPENDENT CONTRACTOR
Section 4.01. Operator Status.
In the performance of its duties in the administration, management and operation
of the Hotel, Operator shall act as an independent contractor. Nothing herein
shall constitute or be construed to be or create a partnership or joint venture
between Lessee and Operator, or be construed to create a lease by Operator of
the Hotel or the Property and Operator shall not constitute a tenant or
subtenant of Lessee. It is expressly covenanted that this Agreement is no more
than an agreement for the rendering of services by Operator on behalf of Lessee
in the operation and management of the Hotel.
Section 4.02. Employees.
Operator agrees that Lessee will have the right to review, interview, approve,
or override, the hiring of Hotel General Manager and Director of Sales. Operator
will use all commercially reasonable methods, consistent with other nationally
recognized hotel operators, at their disposal, to find qualified candidates for
the above listed positions. Operator agrees that if termination of either
General Manager or Director of Sales occurs, Operator may, to the extent
necessary, as determined by Lessee and Operator, put temporary or task force
help in those vacated positions to insure continued smooth running operations of
Hotel until the vacated position has been filled. Within the first year of the
Term, Operator will not relocate either the Hotel General Manager or the
Director of Sales to another hotel operated by Operator, without Lessee's
consent in its sole and absolute discretion, however, such consent by Lessee
will not be unreasonably withheld.
(a) Each Hotel employee shall be the employee of Operator, or an affiliate
company of Operator, and not of Lessee, and every person performing services in
connection with this Agreement shall be acting as the employee of Operator
(except for any independent contractors engaged by Operator, in accordance with
this Agreement), but their salaries and other related expenses shall be an
Operating Expense.
(b) Operator shall provide evidence to Lessee of statutory Worker's Compensation
Insurance and Employer's Liability Insurance for each such employee upon
Lessee's request. The insurance coverages (including, without limitation, the
carrier, policy limits of each and waiver of subrogation endorsements) must be
in form, substance and amount in accordance with this Agreement. Upon request of
Lessee, Operator will deliver to Lessee waiver of subrogation endorsements in
favor of Lessee.
(c) The hiring policies and the discharge of employees at the Hotel shall in all
respects comply with all applicable laws and regulations, and Operator shall
comply with all laws, regulations and ordinances regarding the employment and
payment of persons engaged in the operation of the Hotel.
(d) Lessee shall have the right to participate in any negotiations with labor
unions representing employees at the Hotel, and Operator shall not sign any
union contracts or card check neutrality agreements covering such employees at
the Hotel, which have not been previously approved in writing by Lessee.
Section 4.03. Employee Expenses.
(a) All costs pertaining to all employees at the Hotel, including, without
limitation, salaries, benefits, EPLI coverage, the terms of any bonus plan or
arrangement, costs incurred in connection with governmental laws and regulations
and insurance rules, shall be set forth in the Approved Budget as an Operating
Expense.
(b) Compensation, overhead costs and other expenses of Operator and its
Affiliates not specifically provided for herein shall not be Operating Expenses
and shall not be payable or reimbursable by Lessee; provided, however, Operator
may include in the calculation of Operating Expenses the salary of any of
Operator's employees which have been temporarily transferred to a Hotel to serve
that Hotel exclusively. Operator may also include in the calculation of
Operating Expenses reasonable travel costs associated with Operator's employees
located at the Operator's corporate headquarters which have been temporarily
transferred to a Hotel to serve that Hotel exclusively. Lessee shall have the
right to approve temporary travel schedule.
Section 4.04. Employee Benefit Plans.
Operator shall make available to employees at the Hotel in medical and health,
life insurance and employee benefit plans on terms that are consistent with the
other hotel employees managed by Operator.  Operator's contributions to such
plans, reasonable administrative fees, at cost, which may be expended in
connection therewith, and reasonable expenses for such plans will be estimated
and disclosed to Lessee in advance and provided for in the Approved Budget and
will be an Operating Expense.   Except as otherwise provided in Section 6.03,
all costs referenced in Section 4.03 and this Section 4.04 will be the
responsibility of Lessee only to the extent the same are provided for in the
Approved Budget.  Operator will provide a 401(k) plan as an employee benefit
plan.  All costs incurred by Operator pursuant to actions taken by Operator at
Lessee's direction will be Operating Expenses.
Section 4.05. Execution of Agreements.
(a) Except as provided in Section 4.05(b), Operator shall execute as agent of
Lessee leases and other agreements relating to equipment and/or services
provided to the Hotel, all of which, unless otherwise approved in writing in
advance by Lessee, shall either be a term of one year or less or be cancelable
upon not more than thirty (30) days' written notice by Operator or Lessee
without the payment of a penalty or fee. Notwithstanding the foregoing, without
the prior written approval of Lessee, Operator shall not enter into any
agreement (i) which provides for the payment of sums not authorized by Lessee in
an Approved Budget, (ii) which would give rise to a lien upon all or any part of
the Property, (iii) which would result in liability to Lessee for sums other
than as set forth in the applicable Approved Budget, (iv) to lease any part of
any Property, (v) relating to alterations to the exterior, interior or
structural design of the Hotel, (vi) which requires an unbudgeted payment of
more than $5,000, or in the case of a repair of any payment of more than $1,500,
(vii) which is not cancelable by Lessee upon 30 days' notice or less unless the
term of said agreement is one year or less, or (viii) which provides for any
automatic renewal terms greater than thirty (30) days,  or (ix) contracts for
multiple rooms and / or multiple days that (a) exceed a 1-year term and / or (b)
exceed 40% of  the hotel's room inventory for a period of 14 days or more, or
(c) exceed 50 room nights and have a negotiated net rate of $69 or less, this
includes promoting such rates online, in print ads such as coupons. If Operator
desires to enter into any agreements requiring the consent of Lessee, Operator
shall first send written notice of intent to enter into such agreement to
Lessee, and Lessee shall either approve or disapprove within five (5) business
days of receipt of such notice.  Lessee's failure to timely respond to said
request shall be deemed approved so long as Operator has provided no less than
two written notices to Operator.
(b) Subject to Lessee's prior approval of the same and upon Lessee's request,
Operator shall execute, as agent for Lessee, (i) all leases, as sub-lessor, of
any space at any Property, and (ii) equipment rental and/or lease agreements
which cannot be terminated upon thirty (30) days' notice or less without the
payment of a penalty or fee. Operator shall exercise reasonable efforts to
obtain in each equipment agreement a right on the part of the lessee of such
equipment to terminate the same on thirty (30) days' notice or less without the
payment of a penalty fee. Notwithstanding anything in this Section 4.05 to the
contrary, Lessee reserves the right, exercisable at Lessee's option, to execute
any lease or other agreement relating to equipment and/or services being
provided to the Hotel.
ARTICLE 5 

INDEMNIFICATION
Section 5.01. Indemnification by Operator.
In addition to all other obligations of Operator to Lessee hereunder, Operator
shall indemnify and hold Lessee and its Affiliates, and their respective
directors, officers, owners, employees, subsidiaries, members, shareholders and
successors (collectively, "Lessee Indemnified Parties") harmless against all
claims, demands, actions, liabilities, losses, damages, lawsuits and other
proceedings at law or in equity, judgments, awards, commissions, fees, costs and
expenses (including, without limitation, attorneys' fees and expenses)
(collectively referred to as "Claims"), of every kind and nature whatsoever to
or of any party connected with, or arising out of, or by reason of (a) an Event
of Default by Operator; (b) the gross negligence, fraud, recklessness, willful,
or intentional misconduct on the part of Operator, any Affiliate of Operator, or
any officer, employee, agent, contractor, subcontractor, or other person or
entity working for Operator or any Affiliate of Operator; and (c) any Claims by
Hotel employees based on a violation of employment laws by Operator's employees
including, but not limited to Claims arising from workers' compensation,
wage-and-hour laws, unemployment compensation, unfair labor practices, federal
and state discrimination laws, Occupational Safety and Health Administration
laws, requirements under the WARN Act (except with respect to those matters for
which Lessee is to indemnify Operator as set forth in Section 16.05), and Family
and Medical Leave Act laws, all of which include any administrative action
therein; provided, however, that Operator shall not have liability under this
Section 5.01 to the extent any Claims arise out of, or result from, acts or
omissions covered by the indemnity by Lessee set forth in Section 5.03, it being
agreed that if both Lessee and Operator have indemnification obligations under
this Agreement relating to an act or omission, then the liability shall be
apportioned between such parties based on their comparative fault or
responsibility for such act or omission. The indemnification provisions of this
Section 5.01 are subject to the limitations set forth in Section 5.02.
Section 5.02. Limitations on Indemnification.
None of the indemnifications set forth in Section 5.01 shall be applicable to
(1) liability resulting from the design or construction of the Hotel, or (2)
that portion of a liability which is covered and paid for by insurance
maintained for the Hotel. The standard of performance of which Operator is to be
responsible under this Agreement shall be that, reasonably and diligently
exercised, of a professional hotel operator. Settlement of a third party claim
shall not be prima facie evidence that a party has triggered an indemnification
obligation hereunder.  Notwithstanding the provisions of Section 5.01 above,
neither Lessee nor Operator will assert against the other and each does hereby
waive with respect to the other any claims for any losses, damages, liabilities
and expenses (including lawyers' fees and disbursements) incurred or sustained
by that party as a result or damage or injury to persons or property arising out
of the ownership, operation or management of the Hotel, to the extent that the
damage and injury are covered by insurance and the proceeds are actually
recovered from the insurer.
Section 5.03. Indemnification by Lessee.
Lessee shall indemnify and hold Operator and its Affiliates, and their
respective directors, officers, owners, employees and successors (collectively,
"Operator Indemnified Parties") harmless against all Claims of every kind and
nature whatsoever to or of any party connected with or arising out of, or by
reason of : (i) an Event of Default by Lessee; (ii) the performance by Operator
or its Affiliates of its services hereunder, including, without limitation, any
and all obligations incurred relating to any agreements with third parties
entered into by Operator or Lessee in connection with the management or
operation of the Hotel, (iii) the breach or alleged breach of any certificate of
occupancy, business licenses and liquor licenses, Franchise Agreement, the
Mortgage and all other contracts, documents, authorizations, leases and consents
governing the operation and ownership of the Hotel by Operator, Lessee, Owner or
the Hotel, (iv) any interim management agreement relating to alcoholic
beverages, liquor facilities lease agreement, food and beverage lease agreement,
concession agreement or similar document or any transfer or other licensing
application and any other documents required in connection therewith, and (v)
any other matter that is expressly made subject to indemnification by Lessee
under the terms of this Agreement; provided, however, that Lessee shall not have
liability under this Section 5.03 to the extent any Claims arise out of, or
result from, acts or omissions covered by the indemnity by Operator set forth in
Section 5.01, it being agreed that if both Lessee and Operator have
indemnification obligations under this Agreement relating to an act or omission,
then the liability shall be apportioned between such parties based on their
comparative fault or responsibility for such act or omission. The
indemnification provisions of this Section 5.03 are subject to the limitations
set forth in Section 5.02.
Section 5.04. Survival of Indemnity.
The provisions of this Article 5 shall survive the expiration or sooner
termination of this Agreement with respect to matters arising out of facts or
circumstances occurring during the period prior to such expiration or
termination.
ARTICLE 6 

BUDGETS AND POLICY MEETINGS
Section 6.01. Budgets.
(a) No later than October 15th of each year, Operator will prepare and submit
(following discussions with Lessee) to Lessee an annual capital budget for each
Fiscal Year for each Hotel (the "Hotel Capital Budget").  Notwithstanding the
foregoing, for the Fiscal Year in which this Agreement is executed Operator
shall manage the Hotel in accordance with the then existing Hotel Capital
Budget, which is subject to force majeure.  The Hotel Capital Budget will set
forth all projected Capital Improvements for such Fiscal Year, which budget
shall also be month-to-month as well as annual. The Hotel Capital Budget will be
subject to the approval of Lessee, in their sole and absolute discretion.  No
later than November 1 of each year, Operator shall prepare and submit (following
discussions with Lessee) to Lessee an annual operating budget and business plan
for the operation of the Hotel for the forthcoming Fiscal Year containing
detailed projections of Gross Hotel Income and budgets of Operating Expenses
(the "Operating Budget").  Notwithstanding the foregoing, for the Fiscal Year in
which this Agreement is executed Operator shall manage the Hotel in accordance
with the then existing Operating Budget.  The Operating Budget shall be
month-to-month as well as annual and shall be in the form designated by Lessee,
and approved by Operator, which approval of the form shall not be unreasonably
withheld.  The Operating Budget and the Hotel Capital Budget shall provide for
operating, equipping and maintaining the Hotel in accordance with the Hotel
Standards. Contemporaneously with the submission of the Hotel Capital Budget,
Operator shall submit to Lessee monthly budgeted occupancy, average daily rate
and RevPAR statistics for the hotel. The Operating Budget and the monthly
budgeted hotel operating statistics shall contain Operator's reasonable good
faith estimates of the amounts set forth therein. Operator shall provide Lessee,
upon request, all details, information and assumptions used in preparing the
Hotel Capital Budget and the Operating Budget.  Lessee shall be responsible for
implementing the Hotel Capital Budget and may, in Lessee's sole discretion,
increase, decrease, delete or modify in any respect any capital expenditure in
any Hotel Capital Budget.
(b) Operator shall review the Hotel Capital Budget and the Operating Budget with
Lessee, and upon Lessee's written approval of the Hotel Capital Budget and
Operating Budget, it shall constitute the Approved Budget for the succeeding
Fiscal Year and shall be implemented by Operator.  In the event Lessee does not
provide Operator with written objections to the Hotel Capital Budget and
Operating Budget within seven (7) days following Operator's second e-mail
notification to Lessee, and in no event less than 30 days following Lessee's
receipt of such Hotel Capital Budget, they shall be deemed approved.  If Lessee
objects to any portion of the Hotel Capital Budget or the Operating Budget
within 30 days after receipt of the same, or to any portion of the revisions
within 20 days after submission of the revisions by Operator to Lessee, the
parties hereto will call a special budget meeting to resolve the points of
disagreement.  In the event that Lessee and Operator are unable to agree on the
Operating Budget for a Hotel prior to the commencement of the applicable Fiscal
Year, an interim operating budget shall be implemented which will reflect CPI
increases for expenses and RevPAR increases based on the appropriate previous
12-month RevPAR growth percentage for the sector in which the Hotel is included,
as published by Smith Travel Research, for revenue growth over the prior year's
actual amounts, including automatic increases of any necessary expenses such as
Real Estate Tax, franchise fees or insurance.
Section 6.02. Budget Meetings.
Budget meetings between Lessee and Operator will be held at times as reasonably
scheduled by Lessee.  At each budget meeting and at any additional meetings
during a Fiscal Year called by Lessee, Operator shall consult with Lessee on
matters of policy concerning management, sales, room rates, wage scales,
personnel, general overall operating procedures, economics and operation and any
other matters affecting the operation of the Hotel as requested by Lessee.
ARTICLE 7 

OPERATING EXPENSES
Section 7.01. Payment of Operating Expenses.
(a) In performing its authorized duties hereunder, Operator shall promptly pay
all Operating Expenses, except that if requested by Lessee certain Operating
Expenses shall be paid by Operator directly to Lessee for payment by Lessee to
the appropriate lender, taxing authority, insurer or other party so identified
by Lessee to Operator.
(b) Subject to Article 5, all reasonable third party Operating Expenses incurred
by Operator in performing its authorized duties shall be reimbursed or borne by
Lessee; provided that such Operating Expenses are incurred pursuant to and
within the limits set forth in an Approved Budget or otherwise pursuant to the
terms of this Agreement.
(c) Lessee acknowledges that the Approved Budget is a reasonable estimate only
and that any projections set forth in the Approved Budget are subject to and may
be affected by changes in financial, economic and other conditions and
circumstances beyond Operator's reasonable control, and that such projections
are not to be construed as a guaranty by Operator of the actual results of
operations to be obtained. Accordingly, in no event shall failure to meet or
exceed the Approved Budget constitute an Event of Default by Operator as long as
Operator uses commercially reasonable efforts to meet the revenue and expense
projections set forth in the Approved Budget. Notwithstanding the foregoing,
Operator will at all times be subject to the Performance Failure parameters laid
out in Section 16.02 hereto.  Notwithstanding anything to the contrary contained
herein, (i) Operator is authorized to spend up to the greater of (a) an
additional ten (10%) percent for any budgeted line item in an Approved Budget
for a period or (b) $1,000, provided, however, that in no event shall Operator
exceed, in the aggregate, five percent (5%) of the total Approved Budget without
Lessee's prior written approval, (ii) if there is an increase in revenue over
the budgeted line items for revenue in the Approved Budget, the budgeted line
items in the Approved Budget for discretionary expenses shall be increased by a
corresponding and proportional amount, and (iii) if there is a decrease in
revenue under the budgeted line items for revenue in the Approved Budget, the
budgeted line items in the Approved Budget for discretionary expenses shall be
decreased by a corresponding and proportional amount.
Section 7.02. Operating Expenses Not an Obligation of Operator.
Except as may be otherwise specifically provided in this Agreement, Operator
shall in no event be required to advance any of its own funds for Operating
Expenses of the Hotel, nor to incur any liability in connection therewith unless
Lessee shall have furnished Operator with funds as required of Lessee under the
terms of this Agreement. However, if Lessee has provided funds required of
Lessee hereunder, Operator shall advance such funds necessary to pay expenses
incurred by Operator in performing its duties and obligations hereunder. Unless
agreed to by Lessee in this Agreement, in the Hotel Operating Budget or
otherwise in writing in advance, compensation, overhead costs, and other
expenses of Operator and its Affiliates shall not be reimbursable to Operator by
Lessee.
ARTICLE 8 

BANK ACCOUNTS
Section 8.01. Lessee Revenue Account.
  All income, receipts, and proceeds included in the definition of Gross Hotel
Income shall be deposited into Lessee Revenue Account.
Section 8.02. Operating Account
Operator shall establish and maintain one or more separate segregated operating
accounts (collectively, the "Operating Account") at a FDIC insured bank
designated by Operator (except to the extent any Lender requires that the
Operating Account be held with Lender) for the collection and disbursement of
monies in connection with the management and operation of the Hotel.  From the
Operating Account, Operator shall pay all Operating Expenses, and other costs
and expenses relating to the operation of the Hotel as permitted or required to
be paid by Operator in accordance with this Agreement before any penalty or
interest accrues thereon.  The Operating Account shall be a segregated account
and at all times shall be in Lessee's name; provided that Hotel Employees
designated by Operator from time to time which shall be bonded or otherwise
insured shall be authorized signatories of such account, as shall be
representatives of Lessee.  All interest earned or accrued on amounts invested
from the Operating Account shall be added to the Operating Account.
Section 8.03. Ownership of Accounts
Lessee shall furnish information necessary for the printing of all Operating
Account checks, which will bear the name of the Hotel.  All bank accounts
(including the Operating Account but excluding the Reserve Fund), bank balances,
bank statements, advice, paid checks, blank checks and other related records
established in connection with operation of the Hotel or the ownership of the
Property shall be the sole property of Lessee and/or any designee of Lessee.
Section 8.04. Exculpation of Operator
All expenses incurred by Operator in performing its obligations under this
Agreement shall be borne by Lessee and, to the extent funds are available, paid
out of the Operating Account by Operator.  All debts and liabilities to third
parties which Operator incurs as Operator under this Agreement, whether incurred
in the name of Lessee, Operator or the name of the Hotel or any variation of
such name used as a trade name, are and shall be the obligations of Lessee, and
Operator shall not be liable for any such obligations by reason of its
management, supervision and operation of the Hotel.  In the event that funds are
not available in the Operating Account to pay any such expenses, debts or
liabilities, Lessee shall promptly upon request from Operator, deposit funds in
the Operating Account sufficient to pay such expense, debts or liabilities.
Section 8.05. Reimbursement of Operator
Operator shall be reimbursed for all Out-of-Pocket Expenses and Travel Expenses
incurred in rendering services to the Hotel or Lessee to the extent such
Out-of-Pocket Expenses and Travel Expenses are provided for in the Annual
Budget, required or permitted by this Agreement or otherwise approved by Lessee,
which approval shall not be unreasonably withheld, conditioned or delayed. 
Nothing in this Agreement, however, shall require Operator to advance or
otherwise expend any of its own funds in connection with the operation of the
Hotel or ownership of the Property.  If Operator pays any amount for which
Lessee is responsible under this Agreement, Operator shall be entitled to
reimbursement thereof by Lessee.  Operator may pay to itself the Out- of-Pocket
Expenses and Travel Expenses or other reimbursements from the Operating Account,
with Lessee's approval. The Out-of-Pocket Expenses and Travel Expenses shall be
payable to Operator monthly, in arrears.  Operator shall also be reimbursed for
all reasonable costs and expenses incurred in taking over management of the
Hotel in accordance with the pre-opening budget, such reimbursement to be paid
within fifteen (15) days after Operator delivers and invoice therefore.
Section 8.06. Working Capital Funds
Lessee further agrees to provide funds to Operator sufficient to maintain a cash
balance in the Operating Account equal to or greater than the Working Capital
Amount, which amount shall be used by Operator solely in connection with
operation of the Hotel and performance of the responsibilities of Operator under
this Agreement.  If Operator notifies Lessee that funds in the Operating Account
are less than the Working Capital Amount, Lessee shall promptly, but in no event
later than five (5) Business Days after receipt of such notice from Operator,
provide sufficient funds to bring the balance of the Operating Account up to the
Working Capital Amount.
ARTICLE 9 

BOOKS, RECORDS AND STATEMENTS
Section 9.01. Books and Records.
(a) Operator shall keep full and adequate books of account and other records
reflecting the results of operation of the Hotel on an accrual basis, all in
accordance with GAAP.
(b) Except for the books and records which may be kept in Operator's home office
or other location approved by Lessee the books of account and all other records
relating to or reflecting the operation of the Hotel shall be kept at the Hotel.
All such books and records pertaining to the Hotel, including, without
limitation, books of account, guest records and front office records, at all
times shall be the property of Lessee and, except for books of account, accounts
payable invoices, night audit packages, deposit records and similar documents
which may be sent to Operator's accounting department shall not be removed from
the Hotel by Operator without Lessee's written approval and consent. All books
and records pertaining to the Hotel and of Operator (including all budgetary
records of Operator), wherever kept, shall be available to Lessee and its
representatives at all reasonable times for examination, audit, inspection,
transcription and copying. Operator shall not remove, destroy or delete any
books and records of the Hotel without the prior written consent of Lessee. Upon
any termination of this Agreement, all of such books and records pertaining to
the Hotel forthwith shall be turned over to Lessee so as to ensure the orderly
continuance of the operation of the Hotel, but such books and records shall be
available to Lessee for a period of five (5) years at all reasonable times for
inspection, audit, examination, and transcription of particulars relating to the
period in which Operator managed the Hotel.
Section 9.02. Statements.
(a) Operator shall deliver to Lessee by the eighth (8th) business day following
the last day of each month, for each Hotel, a monthly report of the state of the
business and affairs of the operation of the Hotel for the immediately preceding
month and for the Fiscal Year to date and within eight (8) business days after
the end of each quarter, a quarterly report with respect to the preceding
quarter. Such reports shall include at least (i) a balance sheet account
reconciliation including all intercompany accounts, (ii) a profit and loss
statement, comparing current month and Fiscal Year-to-date profit, loss, and
operating expenses to the Approved Budget and the prior year and comparing
current month, quarter and Fiscal Year-to-date average daily rate, occupancy and
RevPAR to the Approved Budget and the prior year, (iii) a statement which
details the computation of all fees payable to Operator for the month and
quarter, (iv) the balance of all bank accounts, and (v) an adjusting statement
showing the actual cash position of the Hotel for the month, quarter and Fiscal
Year-to-date. Additionally, Operator shall deliver to Lessee fifteen (15)
business days following the end of each month and fifteen (15) business days
following the end of each quarter a written narrative discussing any of the
aforementioned reports and year-to-date variances from the Approved Budget,
without thereby implying Lessee's approval of such variance.
(b) Such reports and statements (i) shall be in form and in detail satisfactory
to Lessee as reasonably requested by Lessee and consistent with standard hotel
reporting procedures, (ii) shall be taken from the books and records maintained
by Operator in the manner hereinabove specified, and (iii) if requested by
Lessee, shall be in electronic form.
(c) Within sixty (60) days after the end of each Fiscal Year, Operator shall
deliver to Lessee reviewed financial statements for Operator, and, if requested
by Lessee, within thirty (30) days after the end of each quarter of each Fiscal
Year, Operator shall deliver to Lessee unaudited financial statements for
Operator.
(d) In addition, Operator shall timely deliver to Lessee a copy of (i) a monthly
STAR report from Smith Travel Research for each Hotel, where available (which
Operator hereby agrees to order with respect to each Hotel and provide to
Lessee), (ii) each Guest Satisfaction report, (iii) upon receipt, each
Franchisor inspection report, and (iv) such other reports or information in such
form as may be reasonably requested by Lessee.  Any out-of-pocket costs incurred
by Operator to generate such reports will be included in Operating Expenses
(e) Operator agrees to annually have accounting and operations practices
reviewed by a certified person or entity in order to provide Lessee with
verification of a Type 2 SOC 1 Report, Report on Controls at a Service
Organization Relevant to User Entities' Internal Control over Financial
Reporting. This report is to be prepared under Statement on Standards for Attest
Engagements 16 (SSAE 16) as promulgated by the AICPA and all costs associated
with the report shall be paid for by Lessee. If the standards of the AICPA
change, the operator agrees to comply with revisions of these standards.
(f) Operator shall use the accounting software and payroll processor specified
in Exhibit A-2.
ARTICLE 10 

OPERATOR'S FEE AND TRANSFERS TO LESSEE
Section 10.01. Payment of Operator's Fee.
Within three (3) business days after the delivery to Lessee of the monthly
report required by Section 9.02, Operator shall be paid the Operator's Fee by
Lessee for the immediately prior month, based upon Gross Hotel Income for the
immediately prior month, as determined from the books and records referred to in
Article 9, together with the Accounting Fee, the Revenue Management Fee and any
other amount to be reimbursed to Operator as set forth in this Agreement.
ARTICLE 11 

REPAIRS AND MAINTENANCE
Subject to the provisions of the Approved Budget, Operator shall from time to
time make such expenditures for repairs and maintenance as are necessary to keep
the Hotel in good operating condition in accordance with the Hotel Standards. If
any repairs or maintenance shall be made necessary by any condition against the
occurrence of which Operator, Lessee has received the guaranty or warranty of
any contractor for the building of the Hotel or of any supplier of labor or
materials for the construction of the Hotel, then Operator shall, on Lessee's
request, cooperate with Lessee in invoking such guarantees or warranties.
Notwithstanding the Approved Budget, Lessee may from time to time at its expense
make such alterations, additions, or improvements (including structural changes
or repairs) in or to the Hotel as they deem desirable, in their sole discretion
and responsibility, for the efficient operation of the Hotel. Lessee and
Operator agree that if Lessee requests that any non-routine renovation or
remodeling programs or improvements in excess of $25,000 be supervised by
Operator, those services are beyond the scope of this Agreement, and, if such
services are requested by Lessee, Operator shall by entitled to charge Lessee a
construction management fee to be mutually agreed to by the parties for the
costs to plan, execute and supervise such non-routine renovation or remodeling
programs or improvements at the Hotel, provided that such supervision requires
personnel from Operator other than Hotel personnel or regional operations.

ARTICLE 12 

INSURANCE
-
General.

Lessee and/or Owner shall maintain insurance policies with respect to the Hotel
as set forth below. Operator agrees to cooperate with Lessee and/or Owner in
obtaining any such insurance. Operator further agrees to provide Lessee with
detailed summaries of their Worker's Compensation, Auto Liability, Cyber and
Employment Practices Liability insurance policies and endorsements upon renewal.
Section 12.02. Workers' Compensation and Other Employment Insurance.
Operator shall obtain, and the Hotel Operating Budget shall include, as an
Operating Expense, Workers' Compensation, in compliance with state law in the
state of operation of each Hotel, including Employers' Liability with minimum
limits of $1,000,000 each accident. Such policy shall include an Alternate
Employer Endorsement naming Lessee and/or Owner, and shall provide for a Waiver
of Subrogation in favor of Lessee.
Section 12.03. Approval of Companies and Cost by Lessee.
All insurance provided by Lessee and/or Owner shall be with such insurance
company or companies as may be selected by Lessee. Lessee will obtain all
insurance but, upon the request of Lessee and/or Owner not less than one hundred
twenty (120) days prior to the coverage date, Operator will obtain such
insurance, subject to Lessee's approval of the insurance companies and
coverages.  Comprehensive general liability insurance and such other liability
insurance as may be obtained or afforded shall be in the name of Lessee and/or
Owner, and shall name Operator as an additional named insured as respects
liability arising from the operation, maintenance and use of the Hotel and
operations incidental thereto. All property insurance policies shall be endorsed
specifically to the effect that the proceeds of any building, contents or
business interruption insurance shall be made payable to Lessee and/or Owner.
Operator shall provide proper evidence of insurance required by Operator to
Lessee and/or Owner annually. Such policies shall require a minimum of 30 days'
notice to Lessee in the case of cancellation, for any reason, if allowed by
insurance carrier.
Section 12.04. Maintenance of Coverages.
Lessee and/or Owner shall hold all insurance policies obtained hereunder, and
certificates of such policies, if any, shall be delivered to each of Lessee
and/or Owner and Operator.
Section 12.05. Waiver of Subrogation.
To the extent obtainable from carriers and to the extent that endorsement forms
are approved by the Insurance Commissioner (or comparable office or department)
of the state in which the Hotel is located, all policies of property insurance
shall provide that the insurance companies will have no rights to subrogation
against Lessee and/or Owner or Operator or the agents or employees thereof.
Section 12.06. Blanket Coverage.
Lessee and/or Owner reserves the right to provide any insurance referenced in
this Article 12 by one or more so-called "blanket" or "umbrella" policies of
insurance. Operator further acknowledges that the insurance coverage of the
Hotel may be part of the general insurance plan of Lessee or Owner or of any of
their affiliates. Lessee and/or Owner may elect to obtain any of the insurance
coverages set forth in this Article 12 with a "deductible loss" clause providing
for per occurrence deductibles.
Section 12.07.
Employment Practice Liability

Operator shall obtain EPL coverage insuring against potential claims against
Operator by Operator's employees, for employment related claims. Such coverage
shall have a minimum limit of $2,000,000, and shall name Lessee and/or Owner as
additional insured.
Section 12.08.
Cyber/Network/Privacy Liability.

Lessee and/or Owner shall obtain Cyber/Network/Privacy insurance against
potential claims against Operator and Lessee and/or Owner by third parties or a
governmental authority arising from unauthorized access, unauthorized use, theft
of data, virus transmission, denial of service, internet liability and failure
to protect privacy and intellectual property in connection with and arising out
of the design, development and use of any systems utilized to operate and
maintain the services, premises and operations of the Hotel, with minimum limits
of $1,000,000 per occurrence/aggregate.

Section 12.09.
Liquor Liability.

Operator shall obtain Liquor Legal Liability insurance against potential claims
by third parties arising out of the serving of liquor, if applicable to any
Hotel.  Coverages shall be in amount of minimum limits of $1,000,000 per
occurrence, and shall include Lessee and/or Owner as additional insured.

Section 12.10.
Automobile Liability.

(a)  Lessee and/or Owner shall obtain Automobile Liability insuring against
third party liability claims arising from the use of Lessee owned automobiles,
with minimum limits of $1,000,000 each accident.  Such coverage shall include
the Operator as Additional Insured as respects liability arising from the use of
such automobiles in connection with the Hotel and operations incidental
thereto.  Coverage shall include a Waiver of Subrogation in favor of Operator.

(b)  Operator shall obtain Operator-Owned, Non-Owned and Hired Automobile
Liability and Physical Damage insuring against third party liability and damage
of such vehicles, when such vehicles are used hired or rented by employees of
Operator, with minimum limits of liability $1,000,000 each accident. Coverage
shall include a Waiver of Subrogation in favor of Lessee and/or Owner.

Section 12.11.
General Liability.

Lessee and/or Owner shall obtain General Liability insuring against third party
liability claims with minimum limits of $1,000,000 each occurrence/$2,000,000
aggregate. Such coverage shall include the Operator as Additional Insured as
respects liability arising from the operation, maintenance, and use of the Hotel
and operations incidental thereto. Lessee and/or Owner also agree to maintain
Umbrella Liability Policy with a minimum limit of $10,000,000.00.

Section 12.12.
Property.

Lessee and/or Owner shall obtain Property insurance and Business Interruption
insurance insuring the Hotel properties, as determined appropriate by Lessee
and/or Owner. Coverage shall include a Waiver of Subrogation in favor of
Operator.

Section 12.13.
Crime.

Lessee and/or Owner shall obtain Crime coverage insuring against the dishonest
acts & theft of Lessee's and/or Owner's and Lessee's customers' personal
property by Operator's employees.

ARTICLE 13 

PROPERTY TAXES, LOCAL TAXES, LEVIES AND OTHER ASSESSMENTS
Section 13.01. Property Taxes.
At Lessee's request, Operator shall pay from the Operating Account prior to the
dates the same become delinquent, with the right upon Lessee's request to pay
the same in installments to the extent permitted by law, all real and personal
property taxes levied against the Property or any of its component parts.
Section 13.02. Lessee's Right to Contest.
Notwithstanding the foregoing, Lessee may contest the validity or the amount of
any real or personal tax or assessment. Operator agrees to cooperate with Lessee
and execute any documents or pleadings required for such purpose.
ARTICLE 14 

DAMAGE OR DESTRUCTION - CONDEMNATION
Section 14.01. Damage.
If at any time during the Operating Term the Hotel or any portion thereof should
be damaged or destroyed, Lessee shall have the respective rights and obligations
provided in the Lease with respect to damage or destruction. In the event the
Hotel is not repaired, rebuilt or replaced, Lessee may terminate this Agreement
by written notice to Operator, effective as of the date sent and the parties
shall treat such termination as if it were in connection with the sale of the
Hotel in accordance with Section 16.03.  In the event that Owner and/or Lessee
is required or elects to repair or restore the Hotel, and thereafter fails to
timely (subject to delays caused by Operator, including delays in adjusting the
insurance claim with the carriers which participate in Operator's blanket
insurance program) commence and thereafter pursue the completion of the repair
and restoration of the Hotel in accordance with any Mortgage, Operator may, at
its option, elect to terminate this Agreement, by written notice to Lessee,
effective ninety (90) days thereafter, and upon such termination, Lessee shall
have no obligation to pay to Operator any Termination Fee. Additionally, if
Operator provides termination notice, Lessee will then have thirty (30) days
from when the termination notice is received to begin the repair or restoration
work, in which event the Operator's termination notice will be considered null
and void.

Section 14.02. Condemnation.
If at any time during the Operating Term the whole or any part of the Property
shall be taken or condemned in any eminent domain, condemnation, compulsory
acquisition or like proceeding or sale in lieu thereof by any competent
authority, or if such a portion thereof shall be taken or condemned as to make
it imprudent or unreasonable to use the remaining portion as a hotel of the type
and class immediately preceding such taking or condemnation, then the parties
shall treat such termination as if it were in connection with the sale of Hotel
in accordance with Section 16.03. Operator shall have no right to the award from
the taking or condemning authority in any such proceeding.
ARTICLE 15 

USE OF NAME
During the term of this Agreement, each Hotel shall at all times be known by
such name as from time to time may be selected by Lessee.
ARTICLE 16 

TERMINATION
Section 16.01. Inspection Failure.
If Operator fails two consecutive Franchisor's quality inspections
("Inspection"), for reasons other than capital related issues, Lessee may
terminate this Agreement and such termination shall be by delivery of written
notice by Lessee to Operator not less than sixty (60) days prior to the
effective date of termination. Additionally, Lessee reserves the right, at its
sole and absolute discretion, to request an extra Inspection on the Hotel after
Operator has failed an Inspection, provided ninety (90) days has elapsed to
allow Operator to cure the deficiency that caused such failure and further
provided that such failure is for reasons other than capital related items, and
if Operator fails the extra Inspection this will qualify as two consecutive
fails of Inspections and Lessee may terminate this Agreement and such
termination shall be by delivery of written notice by Lessee to Operator not
less than thirty (30) days prior to the effective date of termination. Lessee
will be responsible for any additional fee required by Franchisor for said extra
Inspection.
(a)
Performance Failure.

(a) If a Hotel fails to achieve as of the end of any Fiscal Year (i) actual NOI
of at least 90% of the budgeted NOI, and (ii) 90% of such Hotel's previous years
running (12) month RevPAR index (as measured by STR) for such Fiscal Year
(collectively, an "Individual Hotel Performance Failure"), subject to the cure
periods below, Lessee may terminate this Agreement with respect to such Hotel
upon sixty (60) days prior written notice to Operator. The effectiveness of any
such notice of termination, however, shall be stayed until completion of the
following applicable cure periods.
If  the Individual Hotel Performance Failure occurs with respect to a Fiscal
Year, but the Hotel achieves as of the end of the immediately following three
(3) months actual NOI of at least 100% of the budgeted NOI for such Hotel for
such three (3) months, and 100% of such Hotel's previous years running (3) month
RevPAR index (as measured by STR), then the Individual Hotel Performance Failure
shall be deemed cured and Lessee shall have no right to terminate for such
Individual Hotel Performance Failure (and any notice of termination with respect
thereto shall be deemed null and void). Operator shall only be able to cure one
(1) Individual Hotel Performance Failure during the Term, in any twelve (12)
month period.
Notwithstanding the foregoing, during hotel renovation periods or other such
situations where more than ten percent (10%) of the Hotel rooms are considered
off-market, the months in which the ten percent (10%) threshold is exceeded,
Operator and Lessee agree to exclude the corresponding time periods from the
calculations described in this Section 16.02 (a) hereto.
(b) If the Hotel, after the Operator has managed the Hotel for a consecutive
twelve (12) month period, at any point, has a negative RevPAR change versus its
Competitive Set as measured by the monthly STR Report of greater than 10% for a
running (12) month period ("Negative RevPAR Individual Hotel Performance
Failure"), subject to the cure periods below, Lessee may terminate this
Agreement with respect to the individual Hotel upon sixty (60) days prior
written notice to Operator. The effectiveness of such notice of termination
however, shall be stayed until completion of the following applicable cure
period.
If the Hotel's performance, as measured by the monthly STR Report, for the
following three (3) consecutive month period after notice of termination is
provided, has a positive RevPAR change versus its competitive set, then the
Negative RevPAR Individual Hotel Performance Failure shall be deemed cured and
Lessee shall have no right to terminate for such Negative RevPAR Individual
Hotel Performance Failure (and any notice of termination with respect thereto
shall be deemed null and void). If, however, the Hotel's performance at any
given period after termination has been cured, as measured by the monthly STR
Report for the following twelve (12) month period, again becomes greater than
negative 10% change against the individual Hotel's competitive set as measured
by the running twelve (12) month period, Lessee may terminate this Agreement
with respect to the individual Hotel upon sixty (60) days prior written notice
and Operator shall no longer have the option to cure.  At any point following
receipt of a termination notice, Operator may provide evidence to Lessee that,
notwithstanding the Hotel's performance, Operator believes circumstances were
outside of Operator's control and, therefore, termination is not justified. 
Lessee may accept such justification in its sole, but reasonable, discretion.
Section 16.03. Sale of Hotel.
Lessee may sell or otherwise dispose of the Hotel to any other person,
partnership, firm or corporation at any time. In such event during the Operating
Term, Lessee may notify Operator in writing no less than thirty (30) days prior
to any such sale of the Hotel and this Agreement shall terminate with respect to
the Hotel upon the closing of the sale.  Upon the sale of the hotel by the
Lessee, and provided Operator is not hired by the new Owner of the Hotel,
Operator will be entitled to an Operator Fee equivalent to the monthly average
of the preceding twelve (12) months Operator Fee for a sixty (60) day period
after the sale.
Section 16.04.
Bad Acts

This agreement may be terminated without notice should Operator commit an act of
fraud, criminal conduct, misappropriation of funds, dishonesty, or willful
misconduct of the manager in connection with the management and operation of the
Hotel.  Such acts will be considered "bad person" acts and will result in
immediate termination of Operator with no recourse against Lessee or Owner.

Section 16.05. Optional Termination.

This Agreement may be terminated by Lessee at any time without a reason upon no
less than sixty (60) days prior notice to Operator, and Lessee shall pay
Operator a termination fee with respect to any such Hotel equal to the lesser
of: 1) 50% of the Operator's Fee paid with respect to the Hotel during the
trailing twelve (12) months prior to the relevant termination (which may include
Operator's Fees for the Hotel for periods prior to the Commencement Date) or, 2)
50% of the average monthly Operator's Fee over the trailing twelve (12) months
prior to the relevant termination multiplied by the number of months remaining
of the then Initial Term or Renewal Term.

Notwithstanding the foregoing, in the event there is less than eighteen (18)
months remaining in the Term, and Lessee choses to terminate this Agreement
without a reason, Lessee will still be required to provide Operator no less than
sixty (60) days prior notice, however, Lessee shall pay Operator a termination
fee with respect to any such Hotel equal to the lesser of 1) 25% of the
Operator's Fee paid with respect to the Hotel during the trailing twelve (12)
months prior to the relevant termination (which may include Operator's Fees for
the Hotel for periods prior to the Commencement Date) or, 2) 25% of the average
monthly Operator's Fee over the trailing twelve (12) months prior to the
relevant termination multiplied by the number of months remaining of the then
Initial Term or Renewal Term.

Section 16.06. Lessee Change of Control.
This Agreement may be terminated by Lessee or Operator upon a change of control
of Lessee (as defined below) during the Operating Term.  Said termination will
be exercised by delivery of written notice to the other party not less than
sixty (60) days prior to the effective date of termination which notice shall
set forth the effective date of termination.  For purposes hereof, a "change of
control" shall be deemed to have occurred if, during the Operating Term, any of
the following events occurs:
(i)
any "person", as that term is used in Section 13(d) and Section 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), becomes, is
discovered to be, or files a report on Schedule 13D or 14D-1 (or any successor
schedule, form or report) disclosing that such person is, a beneficial owner (as
defined in Rule 13d-3 under the Exchange Act or any successor rule or
regulation), directly or indirectly, of securities of Condor Hospitality Trust,
Inc., the parent of Lessee (the "Parent") representing 50% or more of the
combined voting power of the Parent's then outstanding securities entitled to
vote generally in the election of directors;

(ii)
individuals who, as of the date of this Agreement, constitute the Board of
Directors of the Parent or their duly elected successors cease for any reason to
constitute at least a majority of the Board of Directors of the Parent;

(iii)
the Parent is merged, consolidated or reorganized into or with another
corporation or other legal person, or securities of the Parent are exchanged for
securities of another corporation or other legal person, and immediately after
such merger, consolidation, reorganization or exchange less than a majority of
the combined voting power of the then-outstanding securities of such corporation
or person immediately after such transaction are held, directly or indirectly,
in the aggregate by the holders of securities entitled to vote generally in the
election of directors of the Parent immediately prior to such transaction; or

(iv)
the Parent in any transaction or series of related transactions, sells all or
substantially all of its assets to any other corporation or other legal person
and less than a majority of the combined voting power of the then-outstanding
securities of such corporation or person immediately after such sale or sales
are held, directly or indirectly, in the aggregate by the holders of securities
entitled to vote generally in the election of directors of the Parent
immediately prior to such sale.

In the event Lessee terminates this Agreement solely in accordance with this
Section 16.06, Lessee shall pay Operator a termination fee equal to 50% of the
Operator's Fee paid to Operator during a number of months prior to the notice of
termination multiplied by the lesser of twelve (12) months or the number of
months otherwise remaining of the then Initial Term or Renewal Term.
Section 16.07. Operator Change of Control.
This Agreement may be terminated by Lessee upon a change of control of Operator
(as defined below) during the Operating Term.  Said termination will be
exercised by delivery of written notice to the Operator, such notice to be
provided within sixty (60) days following the Lessee being made aware of the
event giving rise to the change of control and not less than thirty (30) days
prior to the effective date of termination which notice shall set forth the
effective date of termination; provided that, in the event such written notice
to Operator is not provided in accordance within the terms of this sentence, the
Lessee shall be deemed to have waived any rights to terminate this Agreement
with respect to the particular change of control giving rise to the required
notice.  For purposes hereof, a "change of control of Operator" shall mean (i) a
change of fifty percent or more of the voting control of Operator or any of its
owner entities or (ii) a substantial change in the current management of
Operator.
In addition to the rights and remedies otherwise available to the Parties at law
or in equity, the following provisions will apply following termination of this
Agreement pursuant to Article 14 or any other provision of this Agreement:
(a)
Operator shall quit, vacate, surrender, and deliver to Lessee peacefully and
promptly the Hotel and all Permits and all books, records, accounts, contracts,
keys, Working Capital, and all other pertinent and necessary documents and
records pertaining to the Hotel and the operation thereof.  If any Permits,
including but not limited to any liquor license, is issued to Operator or any of
its Affiliates, Operator shall, to the extent permitted by Legal Requirements,
assign or cause its Affiliate holding any such Permits to assign to Lessee or
its designee all of the interest of Operator or its Affiliates in such Permits
and the Hotel liquor inventory without charge (other than any out of pocket
expenses of the assignment, which shall be Operating Expenses), or (if such
assignment is not permitted by applicable law) to use reasonable efforts to
provide Lessee or Lessee's designee with the use and benefits of such Permits
and Hotel liquor inventory until such time (not to exceed 180 days) as Lessee
and/or its designee are able to obtain new Permits; provided that Lessee shall
indemnify, defend and hold harmless Operator and its Affiliates from claims and
liabilities arising from the post-termination use of such Permits;

(b)
Operator shall deliver to Lessee any and all of Lessee's properties and assets
within the possession of Operator, including keys, locks and safe combinations,
files, correspondence, information regarding group bookings, reservation lists,
ledgers, bank statements for the Operating Account, accounting books and
records, all electronic data maintained by Operator relating to the Hotel (which
data shall be delivered on computer disc in a format that is accessible and
readable by Lessee's then current computer systems), insurance policies, bonds
and other documents, agreements, leases, licenses, records and plans (including,
without limitation, the as-built or record set plans) relating to the operation
of the Hotel, provided that Operator may retain possession of copies of any of
the foregoing; Operator shall keep confidential all information concerning the
Hotel obtained by Operator or in Operator's possession, and not use any of it
for its own account, for the account of others or in any other manner that would
directly or indirectly compete with the Hotel;

(c)
Operator shall remit to Lessee the balance (if any) of the Operating Account,
after computation and disbursement to Operator of all accrued and unpaid
Management Fees and Operating Expenses reimbursable to Operator;

(d)
As expeditiously as reasonably possible, prepare and deliver to Lessee the
financial reports required under this Agreement with respect to the final
Accounting Period and Fiscal Year and remit to Lessee the amount (if any) shown
as owing to Lessee in the final financial statements on account of previously
overpaid Management Fee, Operating Expenses reimbursable to Operator or other
payments due under this Agreement; and

(e)
Operator shall do all acts and execute and deliver all documents reasonably
requested by Lessee in connection with the transfer, all without consideration
therefor, and otherwise reasonably cooperate with Lessee and any successor
operator to insure or facilitate orderly continuation of the business of the
Hotel;

(f)
The rights and liabilities of the Parties having accrued prior to termination of
this Agreement shall continue;

(g)
Operator will turn over possession of the Hotel in a clean, safe and secure
manner;

(h)
Prior to termination, Operator agrees to maintain operating inventories at
standards consistent with past practice and the Hotel pursuant to the Approved
Budget and existing repair and maintenance schedules;

(i)
Lessee, at its option, may install a shadow management team in the Hotel during
the ten (10) day period immediately preceding the termination date to have daily
access to the Hotel and its books and records; provided that such team shall not
(a) unreasonably interfere with the management and operations of the Hotel, and
(b) consist of more than ten (10) members.  Lessee shall use its reasonable
efforts to cause the entity that succeeds Operator to hire a sufficient number
of Hotel Employees to avoid a WARN Act violation;

(j)
Operator shall at all times fully co-operate with and explain all aspects of the
business and operation of the Hotel to Lessee or any persons authorized by
Lessee to allow Lessee or such persons to successfully and efficiently conduct
the business after the expiration of the Term.

Section 16.08. Bookings Beyond Expiration of Term.
              Operator shall diligently discharge all its obligations under this
Agreement during the whole of the Term, and in particular shall continue to
advertise and promote the Hotel and actively seek and accept bookings
notwithstanding that they are to occur after the expiration of the Term.  Lessee
shall be responsible on its own account for all costs, charges and commissions
payable for bookings made by Operator in the ordinary course of business of the
Hotel, which are for dates after the expiration of the Term.
Section 16.09. Tax Law Change.
Lessee may terminate this Agreement upon sixty (60) days' notice to Operator if
Lessee ceases to be qualified as a real estate investment trust or if the United
States tax laws change to allow a hotel REIT to self-manage its properties.  In
such event, Lessee shall pay Operator a termination fee equal to 50% of the
Operator's Fee paid to Operator during a number of months prior to the notice of
termination multiplied by the lesser of twelve (12) months or the number of
months otherwise remaining of the then Initial Term or Renewal Term.

Section 16.10. Default or Termination of Concession and Lease Agreement
If Operator, or its Affiliate, choose to exercise its option to terminate the
Concession Agreement, or if Lessee terminates the Concession Agreement based
upon default of Operator under the Concession Agreement, Lessee may terminate
this Agreement and such termination shall be by delivery of written notice by
Lessee to Operator not less than ninety (90) days prior to the effective date of
the termination.

In the event the Concession Agreement is terminated, the parties agree to work
together in good faith to make reasonable revisions to this Agreement, which
might be necessary due to the termination.
Section 16.11. Termination Fees.
 Except as provided in Sections 16.03, 16.05, 16.06 and 16.09, Operator shall
not be entitled to a termination fee or compensation in the event this agreement
is terminated for a Hotel or Hotel by Lessee.

ARTICLE 17 

DEFAULT AND REMEDIES
Section 17.01. Events of Default- Remedies.
(a) The following shall constitute Events of Default:
(1) The failure of Operator to diligently and efficiently operate the Hotel in
accordance with the provisions of this Agreement;

(2) The failure of Operator to pay any amount to Lessee provided for herein for
a period of ten (10) days after written notice by Lessee of failure to pay such
sum when payable;

(3) The failure of Lessee to pay any amount to Operator provided for herein for
a period of ten (10) days after written notice by Operator of failure to pay
such sum when payable;

(4) The filing of a voluntary petition in suspension of payments, bankruptcy or
insolvency by either Lessee or Operator or any entity which owns or controls
such party or if any such party otherwise voluntarily avails itself of any
federal or state laws for the relief of debtors or admits in writing its
inability to pay its debts as they become due;

(5) The consent to an involuntary petition in bankruptcy or the failure to
vacate within sixty (60) days from the date of entry thereof any order approving
an involuntary petition by or against either Lessee or Operator;

(6) The entering of an order, judgment or decree by any court of competent
jurisdiction, on the application of a creditor, adjudicating Lessee or Operator
a bankrupt or insolvent or appointing a judicial receiver, trustee or liquidator
of all or a substantial part of such party's assets, and such order, judgment or
decree shall continue unstayed and in effect for a period of one hundred twenty
(120) consecutive days;

(7) The failure of either Lessee or Operator to perform, keep or fulfill any of
the other covenants, undertakings, obligations or conditions set forth in this
Agreement, and the continuance of any such default for a period of thirty (30)
days after written notice of such failure;

(8) Default or termination of the franchise license for a Hotel as a result of
any action, or failure to act, on the part of Operator;

(9) Failure by Operator to pay, when due, the accounts payable for the Hotel for
which Lessee had previously reimbursed Operator.

(10) Hotel receives a "failure" or its equivalent in any quality inspection
report from any of the Franchisors, if such deficiencies are within Operator's
reasonable control.

(b) Upon the occurrence of any Event of Default, the non-defaulting party shall
give to the defaulting party notice of its intention to terminate this Agreement
after the expiration of a period of ten (10) days from such date of notice and,
upon the expiration of such period, this Agreement shall terminate and expire
without penalty. If, however, with respect to the Events of Default referred to
in items (1), (4), (5), (6), (7), (9) (10) and (11) of subsection (a) above,
unless a specific right of termination is specified elsewhere in this Agreement
for the event in question, upon receipt of such notice, the defaulting party
shall promptly and with all due diligence cure the default or take and continue
action to cure such default within such ten (10) day period; provided, in the
case of an event described in Section 17.01(a)(10), and subject to Lessee's
termination rights pursuant to Section 16.01, the Operator shall cure such
default by receipt of a favorable quality inspection report upon an inspection
by the Franchisor within six (6) months following the failed inspection.  If
such default shall not be capable of being cured within such ten (10) day
period, then provided the defaulting party diligently pursues the cure of such
default, such party shall have an additional five (5) days to cure any such
default unless otherwise extended by the non-defaulting party. The procedure set
forth in the preceding two sentences shall not be available for the curing of
any default under items (2), (3) or (8) of subsection (a) above. In the event
such default is not cured by the expiration of such period, the non-defaulting
period may terminate this Agreement effective upon expiration of such period
without penalty or payment of any fee.
Section 17.02. Rights Not Exclusive.
(a) The rights granted under this Article 17 shall not be in substitution for,
but shall be, except as otherwise provided in this Agreement, in addition to any
and all rights and remedies for breach of contract granted by applicable
provisions of law; provided, however, upon any termination of this Agreement by
Operator or Lessee as provided in this Agreement, Operator shall be entitled to
recover only such sums as are owing to or which accrued for the benefit of
Operator under this Agreement up to or on the date of any such termination and
in no event will Operator have any claim or cause of action for "future
profits," damages resulting from termination or otherwise under this Agreement.
(b) No failure of Operator or Lessee to insist upon the strict performance of
any covenant, agreement, term or condition of this Agreement or to exercise any
right or remedy consequent upon a breach thereof, shall constitute a waiver of
any such breach or any subsequent breach of such covenant, agreement, term or
condition. No covenant, agreement, term or condition of this Agreement and no
breach thereof shall be waived, altered or modified except by written instrument
signed by both Lessee and Operator. No waiver of any breach shall affect or
alter this Agreement but each and every covenant, agreement, term and condition
of this Agreement shall continue in full force and effect with respect to any
other then existing or subsequent breach thereof.
ARTICLE 18 

NOTICES
Section 18.01. Notices.
(a) Any notice, statement or demand required to be given under this Agreement
shall be in writing and shall be delivered by certified or registered mail,
postage prepaid, return receipt requested, or by overnight delivery with proof
of delivery, or by facsimile with receipt of transmission, addressed to the
parties hereto at their respective addresses listed below:
(1) Notices to Lessee shall be addressed:

Condor Hospitality Trust, Inc.
1800 West Pasewalk Avenue, Suite 200
Norfolk, NE 68702-1448
Attention:  J. William Blackham, CEO
Facsimile: (402) 371-4229

(2) Notices to Operator shall be addressed:

Peachtree Hospitality Management, LLC
c/o Peachtree Hotel Group, LLC
Two Premier Plaza
5707 Glenridge Drive
Atlanta, GA 30342
Attention: Kevin Cadin/Jon Kapit
Facsimile: (404) 497-4114

(b) All notices, statements, demands and requests shall be effective three (3)
days after being deposited in the United States mail or one day after being sent
by overnight delivery or by facsimile. However, the time period in which a
response to any such notice, statement, demand or request must be given shall
commence to run from date of receipt by the addressee thereof as shown on the
return receipt of the notice, statement, demand or request, but in all events
not later than the tenth (10th) day after it shall have been mailed as required
herein.
(c) By giving to the other party at least thirty (30) days written notice
thereof, either party shall have the right from time to time and at any time
during the Operating Term to change their respective addresses for notices,
statements, demands and requests, provided such new address shall be within the
United States of America.
ARTICLE 19 

ASSIGNMENT
Section 19.01. No Assignment by Operator.
Notwithstanding anything to the contrary set forth in this Agreement, without
the prior written consent of Lessee (which consent may be withheld in Lessee's
sole and absolute discretion), Operator shall have no right to sell, transfer or
assign (or permit the sale, transfer or assignment of) any of its rights, duties
or obligations under this Agreement in any manner, either directly or
indirectly, voluntarily, or by operation of law.
Section 19.02. Assignment by Lessee.
Lessee may transfer or assign its rights and obligations under this Agreement
without the consent of Operator but shall deliver to Operator written notice of
such transfer or assignment not less than ten (10) days prior to the effective
date thereof; provided, however, in the event of the assignment of this
Agreement to a party that is not an Affiliate, Operator shall have the right to
terminate this Agreement within fifteen (15) days after receipt of written
notice of such assignment, which termination will be effective within thirty
(30) days of Lessee's receipt of such termination notice.  Any transfer or
assignment of this Agreement by Lessee shall include an express assumption by
the transferee or assignee of Lessee's obligations hereunder.  Nothing herein
shall be deemed to require Lessee to assign or attempt to assign this Agreement
to any third party, including any buyer of a Hotel.
ARTICLE 20 

SUBORDINATION
Section 20.01. Subordination To Mortgage.
Operator hereby agrees that this Agreement, including, but not limited to
Operator's Fee, shall in all respects be and is hereby expressly made
subordinate and inferior to the liens, security interest and/or any Mortgage and
to any promissory note and other indebtedness secured or to be secured thereby
and to all other instruments evidencing or securing or to evidence or secure
indebtedness, and all amendments, modifications, supplements, consolidations,
extensions and revisions of such note and other instruments and any other
indebtedness of Lessee or Owner, secured or unsecured. Operator shall execute
any and all subordination agreements, estoppel certificates and other documents
requested by Lessee or Owner and/or the Holder to further evidence the
subordination of this Agreement and Operator's rights hereunder including
without limitation providing any purchaser of a Hotel at a foreclosure sale or
deed-in-lieu of foreclosure (including the lender) with the right to terminate
this Agreement; provided, however, Lessee shall use its commercially reasonable
efforts to obtain from the holder of any Mortgage a nondisturbance agreement, in
form reasonably acceptable to Operator providing that this Agreement shall
remain in full force and effect notwithstanding the fact that the Mortgage has
been foreclosed.
Section 20.02. Foreclosure.
Prior to termination of this Agreement by foreclosure under the Mortgage or by
acquisition of the property to be covered by the Mortgage by deed in lieu of
foreclosure, Operator shall have the right to enjoy all rights and privileges
conferred upon it pursuant to this Agreement, including, without limitation the
rights to the Operator's Fee, and Operator shall incur no liability to the
Holder for acting pursuant to the terms of this Agreement.  In the event of such
foreclosure, Operator shall have the right to terminate this Agreement on thirty
(30) days' written notice to Lessee.  Notwithstanding the foregoing, Operator
may pursue, as an unsecured creditor, a claim for all amounts due and owing to
Operator under this Management Agreement in accordance with the terms of this
Section 20.02.
Section 20.03. Estoppel Certificates.
Lessee and Operator agree, at any time and from time to time, upon not less than
10 days prior written notice from the other party or any purchaser or lender, to
provide a statement in writing certifying that this Agreement is unmodified and
in full force and effect (or, if there have been modifications, that the same is
full and force and effect as modified and stating the modifications), and
stating whether or not to the best knowledge of the signer of such certificate,
there exists any default in the performance of any obligation contained in this
Agreement, and if so, specifying each such default of which a signer may have
knowledge.  Any statement delivered pursuant to this Section may be relied upon
by the other party and by the prospective lender or purchaser.
ARTICLE 21 

MISCELLANEOUS
Section 21.01. Further Documentation and Reporting Compliance.
Lessee and Operator shall execute and deliver all appropriate supplemental
agreements and other instruments, and take any other action necessary to make
this Agreement fully and legally effective, binding, and enforceable in
accordance with the terms hereof as between them and as against third parties. 
Operator acknowledges that Parent is a reporting company under the Securities
Exchange Act of 1934, as amended, (the "Exchange Act") and other federal laws,
including the Sarbanes-Oxley Act of 2002, and Operator shall reasonably
cooperate in providing Lessee information as necessary for Parent to prepare and
submit its reports under such laws in a timely fashion.
Section 21.02. Captions.
The titles to the several articles of this Agreement are inserted for
convenience only and are not intended to affect the meaning of any of the
provisions hereof.
Section 21.03. Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of Lessee, its
successors and/or assigns, and subject to the provisions of Article 19, shall be
binding upon and inure to the benefit of Operator, its permitted successors and
assigns.
Section 21.04. Competitive Market Area.
If Operator (or its Affiliates) build or develop, and open for service to the
public, directly or indirectly, any hotel within a three (3) mile radius (as
shown on Exhibit A-4 attached) of any Hotel during the Operating Term, then
unless Lessee has expressly consented thereto in writing in advance, which
consent may be withheld in Lessee's sole and absolute discretion, Lessee shall
have the right to terminate this Agreement upon thirty (30) days' prior written
notice to Operator, without payment of a  termination fee or penalty. The
foregoing provision shall not be deemed to apply to debt financing provided to
any hotel project by Operator or its Affiliates (which shall include, without
limitation, Stonehill Strategic Capital, LLC), nor to the acquisition, through
foreclosure proceedings or otherwise, by Operator or its Affiliates, of any
hotel project to which Operator or its Affiliates has provided, or in the future
provides, debt financing.

Section 21.05. Assumption of Post Termination Obligations.
In the event of termination of this Agreement, Lessee shall be responsible for
assuming obligations under contracts entered into by Operator only to the extent
that any such contract shall have been entered into in accordance with Section
4.05(a) and Lessee shall be responsible for the payment of obligations incurred
by Operator in the operation of the Hotel only to the extent that such
obligations shall have been incurred in accordance with the terms of this
Agreement, and Operator hereby agrees to indemnify and to hold Lessee harmless
from and against any liability in connection with any such contracts, agreements
or obligations not so approved in writing by Lessee.  Lessee will indemnify and
hold Operator harmless from all costs, expenses, claims, damages and
liabilities, including without limitation, lawyers' fees and disbursements,
arising or resulting from Lessee's failure following the expiration or earlier
termination (for whatever cause) of this Agreement to provide all of the
services contracted for in connection with the business booked on commercially
reasonable terms for the Hotel on or prior to the date of such expiration or
termination.  The provisions of this Section will survive any expiration or
termination of this Agreement and will be binding upon Lessee and its successors
and assigns, including any successor or assign that becomes the beneficial or
legal owner of the Hotel after the effective date of any such expiration or
termination.
Section 21.06. Entire Agreement.
This Agreement, together with the Exhibits hereto, constitutes the entire
Agreement between the parties relating to the subject matter hereof, superseding
all prior agreements or undertakings, oral or written.  This Agreement and the
Exhibits hereto shall be construed and interpreted without reference to any
canon or rule of law requiring interpretation against the party drafting or
causing the drafting of this Agreement or the portions in question, it being
agreed and understood that all parties have participated in the preparation of
this Agreement.
Section 21.07. Governing Law.
This Agreement shall be construed and enforced in accordance with the laws of
the State of Nebraska.
Section 21.08. No Political Contributions.
Any provision hereof to the contrary notwithstanding, no money or property of
the Hotel shall be paid or used or offered, nor shall Lessee or Operator
directly or indirectly pay or use or offer, consent or agree to pay or use or
offer any money or property of the Hotel, for or in aid of any political party,
committee or organization, or for or in aid of, any corporation, joint stock or
other association organized or maintained for political purposes, or for, or in
aid or, any candidate for political office or for nomination for such office, or
in connection with any election including referendum for constitutional
amendment, or for any political purpose whatever, or for lobbying in connection
with legislation or regulation thereunder, or for the reimbursement for
indemnification of any person for money or property so used.
Section 21.09. Eligible Independent Contractor.
(a) At the effective time of this Agreement, Operator shall qualify as an
"eligible independent contractor" as defined in Section 856(d)(9) of the
Internal Revenue Code of 1986, as amended (the "Code").  To that end:
(i)
during the Operating Term, Operator shall not permit wagering activities to be
conducted at or in connection with the Hotel;

(ii)
during the Operating Term, Operator shall not own, directly or indirectly
(within the meaning of Section 856(d)(5) of the Code), more than 35% of the
shares of Condor Hospitality Trust, Inc.;

(iii)
during the Operating Term, no more than 35% of the total combined voting power
of Operator's outstanding stock (or 35% of the total shares of all classes of
its outstanding stock) shall be owned, directly or indirectly, by one or more
persons owning 35% or more of the outstanding stock of Condor Hospitality Trust,
Inc.; and

(iv)
At the effective time, Operator shall be actively engaged in the trade or
business of operating "qualified lodging facilities" (defined below) for a
person who is not a "related person" within the meaning of Section 856(d)(9)(F)
of the Code with respect to the Parent or Lessee ("Unrelated Persons"). In order
to meet this requirement, Operator agrees that it (i) shall derive at least 10%
of both its revenue and profit from operating "qualified lodging facilities" for
Unrelated Persons and (ii) shall comply with any regulations or other
administrative guidance under Section 856(d)(9) of the Code with respect to the
amount of hotel management business with Unrelated Persons that is necessary to
qualify as an "eligible independent contractor" with the meaning of such Code
Section.

(b) A "qualified lodging facility" is defined in Section 856(d)(9)(D) of the
Code and means a "lodging facility" (defined below), unless wagering activities
are conducted at or in connection with such facility by any person who is
engaged in the business of accepting wagers and who is legally authorized to
engage in such business at or in connection with such facility. A "lodging
facility" is a hotel, motel or other establishment more than one-half of the
dwelling units in which are used on a transient basis, and includes customary
amenities and facilities operated as part of, or associated with, the lodging
facility so long as such amenities and facilities are customary for other
properties of a comparable size and class owned by other owners unrelated to
Condor Hospitality Trust, Inc.
(c) Operator shall not sublet the Hotel or enter into any similar arrangement on
any basis such that the rental or other amounts to be paid by the sublessee
thereunder would be based, in whole or in part, on either (a) the net income or
profits derived by the business activities of the sublessee, or (b) any other
formula such that any portion of the rent would fail to qualify as "rents from
real property" within the meaning of Section 856(d) of the Internal Revenue
Code, or any similar or successor provision thereto.
Section 21.10. Time of the Essence.
Time is of the essence of this Agreement.
Section 21.11. Offsets.
Each party may offset amounts owed to another party hereunder against any
amounts owed to such party upon written approval of both Lessee and Operator;
except to the extent that any such offset is prohibited by the terms of the
Lessee (or its Affiliates) credit agreements.

Section 21.12.
Attorney's Fees

If any party brings an action against another party to enforce any provision of
this Agreement, the prevailing party in such action shall be entitled to recover
its court costs, attorney's fees and expenses in the judgment rendered through
such action.
Section 21.13. Final Accounting.
(a) In addition to the reports required by Section 9.02, within sixty (60) days
following the effective date of expiration or termination of this Agreement,
Operator shall prepare and submit to Lessee a final accounting of Hotel
operations through the effective date of such expiration or termination, which
accounting shall be in the form of the financial statements required hereunder.
(b) Upon the effective date of expiration or termination of this Agreement,
Operator shall deliver possession of the Hotel, and any cash, property and other
assets pertaining thereto, together with any and all keys or other access
devices, to Lessee.
(c) Upon the expiration or termination of this Agreement, Operator shall
reasonably cooperate with and assist Lessee as may be necessary for the transfer
of the operations and management of the Hotel to the successor operator and the
transfer any and all Hotel licenses and permits to Lessee or Lessee's designee.
Section 21.14. Franchisor Communications.
During the Operating Term, Operator shall promptly deliver to Lessee copies of
any deficiency notices or similar notices received from a Franchisor and any
response thereto. Additionally, Lessee shall promptly deliver to Operator copies
of any deficiency notices or similar notices received from a Franchisor and any
response thereto.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first set forth above.
LESSEE:

TRS MCO VILLAGE, LLC, a Delaware limited liability company

By:      /s/ Jeffrey W. Dougan 
Title:   Vice President 

OWNER:

TRS MCO VILLAGE, LLC, a Delaware limited liability company

By:     /s/ Jeffrey W. Dougan 
Title:  Vice President 

OPERATOR:

PEACHTREE HOSPITALITY MANAGEMENT, LLC, a Georgia limited liability company

By:      /s/ Jatin Desai 
Title:   Manager 

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EXHIBIT A

HOTEL AND OWNER

Hotel
Owner
Location
# of Rooms
 
Hampton Inn Lake Mary, Florida
CDOR MCO Village, LLC
850 Village Oak Lane, Lake Mary, FL
130
                                                                               
                                                                               
                                                                               
               

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EXHIBIT A-1

COMPETITIVE SET FOR HOTEL

Hotel
 
City, State
Zip
Rooms
Courtyard Orlando Lake Mary North
 
Lake Mary, FL
32746-5007
83
Hilton Garden Inn Orlando North Lake Mary
 
Lake Mary, FL
32746-2108
123
La Quinta Inns & Suites Orlando Lake Mary
 
Lake Mary, FL
32746-5404
128
Springhill Suites Orlando North Sanford
 
Lake Mary, FL
32771-7359
105
Hyatt Place Lake Mary Orlando North
 
Lake Mary, FL
32746-1615
128

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EXHIBIT A-2

ACCOUNTING SOFTWARE AND PAYROLL PROCESSES

Accounting Software: M3

Labor Management/Reporting Software: RightTime (M3)

Payroll: Netchex

Profitsword (scheduled for Summer 2017 install)

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EXHIBIT A-3

LIST OF OPERATOR'S HOTELS WITHIN 3-MILE RADIUS

[NONE]

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EXHIBIT A-4

3-MILE RADIUS RESTRICTION MAP FOR THE HOTEL

 [image0.jpg]

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EXHIBIT B

FRANCHISE AGREEMENT FOR THE HOTEL

Hotel
 
Hampton Inn & Suites
Location
 
850 Village Oak Lane, Lake Mary, Florida
Franchisor
 
Hilton Worldwide

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EXHIBIT C

FORM OF APPROVED BUDGET

[See Attached]

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[image1.jpg]

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EXHIBIT D

APPROVED BUDGET (if finalized)

[Not Applicable]

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EXHIBIT E

EXAMPLE INCENTIVE FEE CALCULATION

Hotel Income for Incentive Fee Calculation
           
Gross Hotel Income
          4,296,601
         
Less: Operating Expenses before Incentive Fees
        (3,112,854)
         
Less: 4% Hotel FF&E Reserve
           (171,864)
 4% of Gross Hotel Income used for illustrative purposes
Less: Calculated Incentive Fees
              (42,966)
         
Total Hotel Income for Incentive Fee Calculation
              968,917
                       
Investment in Hotel
           
Acquisition Price
        11,000,000
         
Acquisition Costs
              185,418
         
Capital Expenditure not covered by FF&E Reserve
                         -
         
Total Investment in Hotel
        11,185,418
                       
Investment Return per Incentive Fee terms
8.66%
                       
Investment Return per Incentive Fee terms
                 42,966
 1% of Gross Hotel Income used for illustrative purposes