EXHIBIT 10.6

                                                                      [Colorado]

                                 COMFORT LETTER





                                          June 30, 2000


Apple Suites, Inc.
306 East Main Street
Richmond, Virginia 23219

Attention:        Mr. Glade M. Knight

                  Re:      Homewood  Suites(R)  hotel  located at 4950  Baseline
                           Road, Boulder, Colorado (the "Hotel")

Gentlemen:

         Promus Hotels,  Inc. ("Promus") is about to execute with respect to the
Hotel (i) a License Agreement and the Rider,  Attachment and Exhibits referenced
therein (the  "License  Agreement"),  dated the date hereof,  pertaining  to the
licensing of Apple Suites Management,  Inc., a Virginia corporation  ("Lessee"),
to  operate  the Hotel as a  Homewood  Suites(R)  hotel,  and (ii) a  management
agreement of even date herewith (the "Management Agreement") with respect to the
operation of the Hotel by Promus, as Manager. In addition,  Promus has loaned to
Apple Suites, Inc. ("Fee Owner") the sum of $91,350,000 (the "Acquisition Loan")
as purchase  money  financing for the  acquisition  of certain  properties  (the
"Properties")  conveyed  pursuant to the Purchase  Agreement  (as defined in the
Management  Agreement),  that certain  Agreement of Sale dated August 6, 1999 by
and among  Hampton  Inns,  Inc.,  Promus  Hotels  Florida,  Inc. and Promus,  as
sellers, and Fee Owner, as buyer, as the same has been amended, and that certain
Agreement of Sale dated October 5, 1999 between  Hampton Inns,  Inc., as seller,
and Fee Owner, as buyer, as the same has been amended, which Acquisition Loan is
evidenced by (i) a note of Fee Owner dated  September  20, 1999 in the amount of
$26,625,000,  (ii) a note of Fee Owner  dated  October  5, 1999 in the amount of
$7,350,000,  (iii) a note of Fee Owner dated  November 29, 1999 in the amount of
$30,210,000,  (iv) a note of Fee Owner dated  December 22, 1999 in the amount of
$4,384,500,  (v) a  note  of Fee  Owner  dated  May 8,  2000  in the  amount  of
$11,616,750  and (vi) a note of even date herewith in the amount of  $11,163,750
and is secured by, among other things, mortgage(s),  deed(s) of trust or deed(s)
to secure debt dated  September  20, 1999,  October 5, 1999,  November 29, 1999,
December 22, 1999,  May 8, 2000 or of even date  herewith  from Fee Owner or its
wholly-owned subsidiary which encumbers some or all of the Properties, which may
include the Hotel (the documents  evidencing and securing the  Acquisition  Loan
herein

<PAGE>

referred to as the "Acquisition Mortgage  Documents").  Lessee is the owner of a
leasehold  estate in the Hotel pursuant to a Master Hotel Lease  Agreement dated
September  20, 1999 (as  supplemented,  amended and  modified,  the  "Percentage
Lease") with Fee Owner. Although the License Agreement is non-assignable, and is
not subject to any  collateral  assignment,  Lessee and Fee Owner have requested
that Promus  enter into this letter  agreement  with Fee Owner with  respect to,
among other things, Fee Owner's rights with regard to the License Agreement, and
Promus has requested that Fee Owner enter into this letter agreement with Promus
with respect to, among other things, the Management Agreement and its continuing
rights to operate the Hotel for the term of the Management Agreement, subject to
the terms thereof and hereof, and to confirm certain understandings with respect
to the Acquisition Loan. No third party beneficiaries (other than Fee Owner) are
intended  or implied.  Fee Owner has  requested  that  Promus  inform you of the
procedures  Promus  agrees to follow in the event Lessee  commits a breach under
the provisions of the License Agreement.

         So long  as Fee  Owner  is the  owner  of the  Hotel,  and the  License
Agreement is in effect,  Promus will notify Fee Owner by  certified  mail at the
above address (or such other  address as you may specify in a written  notice to
Promus pursuant  hereto) of any default as a result of any breach of the License
Agreement or  Management  Agreement by Lessee,  provided,  however,  that to the
extent the default is a default under, or termination  of, the Percentage  Lease
or a default  under the  Acquisition  Loan,  Promus shall have no  obligation to
notify Fee Owner as  contemplated  above.  This  notice will be in the form of a
copy of the notice of such default that is sent to Lessee. In the notice, Promus
will  give Fee  Owner  (i) ten (10)  days to cure or cause to be cured  monetary
defaults identified in Promus's default notice and (ii) thirty (30) days to cure
or cause to be cured the non-monetary  breach(es) identified in Promus's default
notice, provided, however, that to the extent the default identified in Promus's
default notice is not capable of being cured by Fee Owner (i.e.,  the bankruptcy
of Lessee or a transfer in violation of the License  Agreement),  Fee Owner will
not be afforded an  opportunity  to cure such  incurable  defaults.  If a breach
identified  in the  notice  is of a  curable  non-monetary  nature  which is not
reasonably  capable of being cured  within  such thirty (30) day period,  Promus
shall  extend  the cure  period  for such  length  of time as Promus in its sole
discretion  reasonably  determines is necessary for such breach to be cured (not
to exceed in any event an additional period of ninety (90) days).

         In the event a default occurs under the Percentage  Lease (other than a
default under the  Acquisition  Loan) and, as a consequence  thereof,  Fee Owner
elects to terminate the Percentage  Lease,  or remove Lessee from  possession of
the Hotel without  terminating the Percentage  Lease or if Lessee does not elect
to extend  the  Percentage  Lease  term  through  the full  term of the  License
Agreement  (any such event  being  referred to herein as a  "Triggering  Event")
while the License Agreement and/or the Management  Agreement are in effect,  Fee
Owner shall give Promus written notice of such  termination  ("Triggering  Event
Notice").  Fee Owner  shall  have a ninety  (90) day  period  from the date such
Triggering Event Notice is given to elect to enter into a lease agreement with a
substitute  lessee of the Hotel satisfying the conditions set forth in Paragraph
1 below (a  "Successor  Lessee") and to obtain a new license  agreement for such
Hotel in the name of such Successor  Lessee,  for a term equal to the balance of
the  original  term of the  License  Agreement  and  otherwise  on the terms and
conditions set forth in the License Agreement,


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<PAGE>

except that it shall be issued to  Successor  Lessee  without the payment of any
application  fee or transfer fee.  Promus's  obligations  to issue a new license
agreement  pursuant to this  paragraph are subject to and  conditioned  upon the
satisfaction of the following:

         1.  Successor  Lessee  shall  (i)  be  a  "Permitted   Transferee"  (as
hereinafter  defined)  and (ii) either (y) be (1) at least fifty  percent  (50%)
owned by Fee Owner or persons that are its "Affiliates" (as hereinafter defined)
and (2)  controlled by Fee Owner or its Affiliates or (z) have complied with the
requirements of Section 11 of the applicable License Agreement.

         For purposes of this letter  agreement the  following  terms shall have
the respective meanings assigned thereto:

                  (a) The term "Permitted  Transferee"  means a person or entity
         that (i) has  adequate  financial  resources to perform all of Lessee's
         obligations  under  and in  accordance  with the  terms of the  License
         Agreement, the Percentage Lease, and/or the Management Agreement,  (ii)
         is not the  franchisor  or an  operator of a chain of hotels  (i.e.,  a
         group of hotels marketed under the same brand name) which competes with
         the Homewood  Suites(R)system  of hotels,  and (iii) enjoys a favorable
         reputation  for integrity in his or its community;  provided,  however,
         that an entity  the stock of which is not  traded on a  national  stock
         exchange shall not qualify as a "Permitted  Transferee"  unless (A) all
         officers,  directors,  managing  members and  general  partners of such
         entity and all persons  having,  directly or indirectly,  a ten percent
         (10%) or more equity or  profit-sharing  interest in such entity  would
         qualify as Permitted  Transferees  under clauses (ii) and (iii) of this
         sentence, and (B) all officers, directors, managing members and general
         partners of any entity having,  directly or  indirectly,  a ten percent
         (10%) or more equity or  profit-sharing  interest in such  entity,  the
         stock  of which is not  traded  on a  national  stock  exchange,  would
         qualify as Permitted  Transferees  under clauses (ii) and (iii) of this
         sentence.  For purposes of the foregoing,  it is agreed that any person
         or entity who or which, because of reputation or past conduct, has been
         denied  or would  be  likely  to be  denied  a  gaming  license  by any
         governmental authority shall not qualify as a "Permitted Transferee".

                  (b) The term "Affiliate"  means, with respect to any person or
         entity,  any other  person or entity  which,  directly  or  indirectly,
         controls, is controlled by, or is under common control with, such first
         person  or  entity.  For the  purposes  of this  definition,  "control"
         (including,  with correlative  meanings,  the terms "controlled by" and
         "under common control with"),  shall mean the  possession,  directly or
         indirectly,  of the power (i) to vote more than fifty  percent (50%) of
         the  securities  having  ordinary  voting  power  for the  election  of
         directors  of the  controlled  person,  or (ii) to  direct or cause the
         direction  of the  management  and policies of the  controlled  person,
         whether  through  the  ownership  of voting  shares or by  contract  or
         otherwise,  and shall be deemed to include the  directors and executive
         officers of Fee Owner.

         2. Successor  Lessee shall also enter into a management  agreement with
Promus  covering the Hotel for a term equal to the balance of the original  term
of the


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<PAGE>

Management  Agreement  covering  the  Hotel  and  otherwise  on  the  terms  and
conditions set forth in such Management Agreement.

         If Fee Owner fails to provide a written  notice to Promus of  Successor
Lessee's  intention to obtain a new license  within such ninety (90) day period,
the License  Agreement  shall,  at Promus's  option,  terminate upon the date of
expiration of such ninety (90) day period, in which event Fee Owner shall pay to
Promus an amount,  as liquidated  damages,  equal to the  aggregate  amount owed
under the License Agreement  (including  liquidated damages attributable to such
termination  as  provided in  Paragraph  13 of the  License  Agreement)  and the
Management Agreement.

         If Fee  Owner  enters  into a new lease  with a  Successor  Lessee  who
intends  to obtain a new  license,  all  existing  breaches  under  the  License
Agreement and the Management Agreement (collectively, the "Hotel Agreements") of
which Promus  notifies Fee Owner must be cured on or before the final day of the
ninety (90) day period,  provided,  however,  if such breach(es) are of the type
set forth in paragraph 13.d.(3) and (4) of the License Agreement or Section 9.01
of the Management Agreement and are not capable of being cured by Fee Owner or a
Successor Lessee within such ninety (90) day period, such breach(es) need not be
cured if Fee Owner or a Successor  Lessee cures all other  breaches of the Hotel
Agreements.  With regard to any breaches of a non-monetary  nature which are not
reasonably  capable of being cured  within  said ninety (90) day period,  Promus
shall  extend  the cure  period  for such  period  of time as Promus in its sole
discretion reasonably determines is necessary for such breaches to be cured.

         In the event Fee Owner  exercises  its  rights  under the terms of this
letter agreement to enable a Successor Lessee to obtain a new license agreement,
Lessee shall not be released from its  obligations  under the  applicable  Hotel
Agreements  accruing  prior to the date  such  Successor  Lessee  obtains  a new
license and enters into a new management agreement with Promus.

         In addition,  in the event the provisions of Internal  Revenue Code, as
amended,  applicable to real estate  investment  trusts  ("REIT") are amended to
permit  REITs,  such as Fee Owner,  to operate  hotels or  otherwise  render the
structure  embodied  by the  Percentage  Lease to be  obsolete  as  economically
unnecessary,  Fee Owner may give Promus  written  notice thereof (the "Tax Event
Notice") and of Fee Owner's  election to terminate the  Percentage  Lease and of
its desire to obtain a new license  agreement  for the Hotel in Fee Owner's name
for a term equal to the balance of the  original  term of the License  Agreement
and otherwise on the terms and  conditions  set forth in the License  Agreement,
except  that it  shall  be  issued  to Fee  Owner  without  the  payment  of any
application  fee or transfer  fee.  The Tax Event  Notice  shall,  in  addition,
contain Lessee's consent to the termination of the Management  Agreement and the
License  Agreement  and  acknowledgment  of the  provisions  of the  immediately
succeeding  paragraph.  Promus's  obligations  to issue a new license  agreement
pursuant to this paragraph are subject to and conditioned  upon the satisfaction
of the following:

         1. Fee Owner shall be a "Permitted Transferee",  except that clause (i)
thereof  shall be  amended  to read "(i) has  adequate  financial  resources  to
perform all of


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<PAGE>

owner's  obligations  under  and in  accordance  with the  terms of the  License
Agreement and/or the Management Agreement".

         2. Fee Owner shall also enter into a management  agreement  with Promus
covering the Hotel for a term equal to the balance of the  original  term of the
Management  Agreement  covering  the  Hotel  and  otherwise  on  the  terms  and
conditions set forth in the Management Agreement.

         In the  event  Fee Owner  exercises  its  right  under the terms of the
immediately  preceding paragraph of this letter agreement to enable it to obtain
a new license agreement, Lessee shall not be released from its obligations under
the applicable Hotel  Agreements  accruing prior to the date Fee Owner obtains a
new license and enters into a new management agreement with Promus.

         In  connection  with  Lessee's  execution  and  delivery of the License
Agreement,  Apple  Suites,  Inc. has executed and  delivered  for the benefit of
Promus that certain  Guaranty of even date  herewith with respect to the License
Agreement (the  "Guaranty").  Promus  acknowledges  that, in the event of actual
conflict,  the terms and provisions of this letter  agreement shall control over
the terms and provisions of the Guaranty. Without limiting the generality of the
foregoing,  and in order to provide  Apple  Suites,  Inc. with the full benefits
intended by the provisions of the immediately  preceding sentence,  Promus shall
notify Apple Suites, Inc. by certified mail not less than ten (10) days prior to
Promus's  execution and delivery of any amendment or modification of the License
Agreement or of its  acceptance of any  voluntary  surrender or  termination  by
Lessee of the License  Agreement,  other than  amendments  or  modifications  or
surrender or termination  which has been requested by Fee Owner or Apple Suites,
Inc. or to which Fee Owner is a party.  Nothing in the foregoing  sentence shall
be deemed or  construed  to limit or restrict  Promus's  rights to  terminate or
exercise any other remedy under the License  Agreement in the event of a default
by Lessee  thereunder,  subject to the other terms and provisions of this letter
agreement.

         With  reference to  Licensee's  representation  in the last sentence of
Section 1(a) of the License Agreement,  Promus  acknowledges that the Percentage
Lease is for a base  term of less  than  twenty  (20)  years  and that only upon
exercising  all  extension  options  available  to Licensee,  including  certain
options  requiring  negotiation  of fair  market  rental,  will  the term of the
Percentage Lease extend to the full twenty (20) years of the term of the License
Agreement.  Fee Owner and Lessee  acknowledge that the failure for any reason to
exercise the extension  options will result in the application of the liquidated
damages  provisions  of  Paragraph  13.f of the License  Agreement  if, upon the
termination of the Percentage  Lease,  Fee Owner or a Successor  Lessee does not
obtain a new license  agreement for the Hotel for a term equal to the balance of
the original term of the License Agreement, as contemplated herein.

         Promus hereby confirms for the benefit of Fee Owner and Lessee that the
License Agreement shall be read with the following clarifications:

                  (i) with respect to the  provisions  of Paragraph  1.d. of the
         License  Agreement  relating  to  the  requirement  to  use  particular
         Supplies  or that  particular


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<PAGE>

         Supplies be  purchased  from Promus or a source  designated  by Promus,
         such  requirements  shall  only be imposed  on the  licensee  under the
         License Agreement to the extent Promus is imposing such requirements on
         substantially all of its licensees of the System, but that with respect
         to other Supplies if Lessee determines that it can purchase Supplies of
         a quality at least equal to that which  Promus is  requiring at a price
         lower  than the price then  being  charged by Promus or its  designated
         supplier, Lessee may purchase such Supplies from its vendor;

                  (ii) with respect to the  provisions of Paragraph  6.a.(19) of
         the License  Agreement,  such  provisions  are not intended to preclude
         Lessee or any member of an affiliated group from owning licensed hotels
         of  other,  even  competing,  brands,  but from  owning a hotel  brand,
         tradename, system or chain;

                  (iii) with  respect to the  provisions  of Paragraph 11 of the
         License Agreement  relating to change in ownership or a transfer of the
         hotel, the provisions are intended to apply only to Lessee's beneficial
         or equity interests or its interest in the hotel; and

                  (iv) with  respect to the  language of the second  sentence of
         Paragraph 13.f. of the License  Agreement reading "If this Agreement is
         terminated  other  than by the  expiration  of the  term  described  in
         Paragraph  13.a.,",  this  language  is not  intended  to modify  other
         provisions  of  the  License  Agreement  relating  to  whether  or  not
         liquidated   damages  are  payable   under  other   circumstances   and
         accordingly  shall be read as if preceded by the phrase "Subject to the
         other provisions of this Agreement".  In addition,  liquidated  damages
         shall not be payable if the License Agreement is terminated as a result
         of Promus's default under the License Agreement.

         Promus  acknowledges that, in the event of actual conflict between this
letter  agreement and the License  Agreement,  the terms and  provisions of this
letter  agreement  shall  control over the terms and  provisions  of the License
Agreement.  Without limiting the generality of the foregoing, (i) no transfer of
any interest in Fee Owner,  or of fee  ownership of the Hotel to an affiliate of
Fee Owner,  shall constitute a prohibited  change of ownership under the License
Agreement,  subject,  however,  to the  penultimate  paragraph  of  this  letter
agreement,  (ii) no transfer of the leasehold interest of Lessee in the Hotel to
a Successor Lessee shall  constitute a prohibited  change of ownership under the
License  Agreement,  and (iii) in no event shall the initial  Licensee be liable
for liquidated  damages as the result of termination of the Percentage  Lease or
default  under the License  Agreement  if a Successor  Lessee is supplied by Fee
Owner or Fee Owner  enters  into a new License  Agreement  following a Tax Event
Notice,  and all prior curable defaults under the License Agreement are cured by
Fee Owner, as contemplated herein.

         Fee Owner and Lessee  agree with Promus as follows  with respect to the
relationship of Promus and Lessee under the Management Agreement:

                  (a) Pursuant to the terms of the Percentage  Lease,  Fee Owner
         has agreed to pay, among other things, (i) land,  building and personal
         property taxes


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<PAGE>

         and assessments  applicable to the Hotel, (ii) premiums and charges for
         property casualty insurance  coverages  specified in Exhibit "D" to the
         Management Agreement, (iii) expenditures for capital replacements, (iv)
         expenditures  for maintenance  and repair of underground  utilities and
         structural  elements of the Hotel and (v) the  payments  of  principal,
         interest   and  other  sums   payable   under  the   Acquisition   Loan
         (collectively,  "Fee  Owner  Costs").  To  the  extent  the  Management
         Agreement  obligates or  authorizes  Promus to pay any Fee Owner Costs,
         Promus shall pay such Fee Owner Costs on behalf of Lessee to the extent
         of funds in the  Hotel's  bank  account(s)  (collectively,  the  "Hotel
         Accounts"),  including, without limitation, the Bank Account(s) and the
         Reserve  Fund (as such terms are defined in the  Management  Agreement)
         subject to any  limitations  contained in the Management  Agreement and
         Fee Owner and Lessee shall make such  adjustments  and payments to each
         other as may be  necessary  from time to time to take into  account any
         such  payments.  Promus shall have no duty,  obligation or liability to
         Fee Owner  (x) to make any  determination  as to  whether  any  expense
         required to be paid by Promus under the  Management  Agreement is a Fee
         Owner Cost or a cost of Lessee,  or (y) to make any determination as to
         whether funds in the Hotel Accounts  belong to Fee Owner or Lessee,  or
         (z) to require  that Fee Owner  Costs be paid from  funds  which can be
         identified  as  belonging  to Fee Owner,  or other  costs and  expenses
         required  to be  paid  by  Lessee  be  paid  from  funds  which  can be
         identified  as  belonging  to  Lessee;  it  being  the  intent  of this
         provision  that (i) Fee Owner and Lessee  shall look only to each other
         and not to Promus  with  respect to moneys  that may be owed one to the
         other  as  consequence  of  Promus's   performance  of  the  Management
         Agreement  and (ii)  Promus  need only look to Lessee to pay  operating
         costs,  including,  without limitation,  those designated herein as Fee
         Owner Costs.

                  (b) Promus shall be permitted  (and is hereby  authorized)  to
         set off  against  any  amounts  owed to  Promus  by  Lessee  under  the
         Management Agreement and the License Agreement any funds held by Promus
         pursuant to the Management  Agreement,  including  amounts in the Hotel
         Accounts,  whether or not amounts are due to Fee Owner by Lessee  under
         the Percentage Lease.

                  (c)  Fee  Owner  has  approved  the  form  of  the  Management
         Agreement and License  Agreement and agrees that Fee Owner's consent or
         approval is not required with respect to the  performance of any of its
         rights,  duties or obligations  under the  Management  Agreement or the
         License Agreement.

                  (d) Fee Owner  hereby  approves  the deposit of funds into the
         Reserve  Account and the  expenditure of funds from the Reserve Account
         by Promus in accordance with the terms of the Management Agreement.

                  (e) To the extent required by applicable laws, Fee Owner shall
         obtain and maintain (or  cooperate in obtaining  and  maintaining)  any
         licenses,  permits or approvals of any governmental authority necessary
         to  operate  and  manage the Hotel in  accordance  with the  Management
         Agreement.



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<PAGE>

                  (f) Fee Owner  acknowledges and agrees that,  unless it enters
         into a license  agreement  pursuant  to a Tax Event  Notice,  it has no
         right to use the Homewood  Suites(R)  "System"  except as expressly set
         forth in the License  Agreement nor any right to use the name "Homewood
         Suites"  or the  Homewood  Suites(R)  "System"  as a result  of  Lessee
         entering into the Hotel Agreements.

                  (g) Fee Owner acknowledges and agrees that any amounts owed to
         Promus under the License  Agreement  and the  Management  Agreement are
         superior  to any  amounts  owed  by  Lessee  to  Fee  Owner  under  the
         Percentage   Lease,   other  than   amounts  owed  in  respect  of  the
         Subordinated Management Fee, as defined in the Management Agreement, to
         the extent Lessee applies amounts  received in respect of Owner's Basic
         Return, as defined in the Management  Agreement,  in respect of amounts
         owed by Lessee to Fee Owner under the Percentage Lease.

                  (h) Fee Owner  agrees  not to amend or modify  the  Percentage
         Lease in any manner  that  would (i) reduce the term of the  Percentage
         Lease,  (ii)  increase the amount of rent payable by Lessee  thereunder
         (except as contemplated by the provisions of the Percentage  Lease), or
         (iii) have a material  adverse effect on any of the rights,  duties and
         privileges of Promus under the  Management  Agreement.  Nothing in this
         paragraph  (h) shall be deemed or  construed  to limit or restrict  Fee
         Owner's  rights to  terminate  or exercise  any other  remedy under the
         Percentage Lease in the event of a default by Lessee thereunder.

                  (i) Fee Owner  acknowledges and agrees that Promus has no duty
         or obligation to comply with any of the terms of the  Percentage  Lease
         and that Fee Owner  will look  solely to Lessee  with  respect  to such
         matters.

                  (j) Fee  Owner  acknowledges  and  agrees  that  (i) no  sale,
         transfer  or  conveyance  of Fee  Owner's fee estate in the Hotel shall
         terminate  the  Management  Agreement,  (ii) except as provided  below,
         neither the  termination of the Percentage  Lease nor the assignment of
         Lessee's interest therein shall terminate the Management Agreement, and
         (iii) no merger of the  leasehold  and fee simple  estates of the Hotel
         shall  terminate the Management  Agreement;  it being the intent of Fee
         Owner and Promus that the Management Agreement shall continue in effect
         for the  term of the  Management  Agreement  so  long as the  Hotel  is
         operating   as  a   Homewood  Suites(R) hotel  pursuant  to  a  license
         agreement and  Manager is not in default of its  obligations  under the
         Management Agreement   (subject,  however,  to  any  express  rights of
         termination contained in the Management Agreement).

                  (k) Fee Owner  acknowledges and agrees that Manager shall have
         a right to file a separate claim in any condemnation case in accordance
         with Article VIII of the Management Agreement.

                  (l) Fee Owner agrees that so long as the License  Agreement is
         in effect the casualty insurance proceeds will be applied in the manner
         provided in the License Agreement.



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<PAGE>

                  (m) In the event  that Fee  Owner  terminates  the  Percentage
         Lease  and as a  consequence  thereof  Promus  terminates  the  License
         Agreement  and does not enter  into a new  license  agreement  with any
         successor operator of the Hotel,  Promus and Fee Owner,  subject to the
         payment of all  amounts  owed under the  Management  Agreement  and all
         amounts  owed  under  the  Acquisition  Loan,  shall  have the right to
         terminate the Management Agreement covering the Hotel.  Otherwise,  the
         successor  operator  shall assume in writing the remaining term of such
         Management Agreement.

         Fee Owner and Lessee  further  agree with  Promus  with  respect to the
Acquisition  Loan that the Percentage  Lease shall be subject and subordinate to
the  lien  of the  Acquisition  Mortgage  Documents  and  to  all of the  terms,
conditions  and  provisions  thereof,  to  all  advances  made  or  to  be  made
thereunder,  and to any  renewals,  extensions,  modifications  or  replacements
thereof,  including any increases therein or supplements  thereto. The foregoing
provisions  shall be  self-operative.  However,  Fee Owner and  Lessee  agree to
execute and deliver to Promus such other  instrument  as Promus shall request in
order to effectuate said provisions.

         It is acknowledged and agreed that (i) Promus shall be entitled to rely
upon any written  notice or request by Fee Owner made pursuant to the provisions
hereof without requirement of investigating the accuracy or authenticity of such
written notice or any facts or allegations contained therein, and (ii) Fee Owner
shall be  entitled  to rely upon any  written  notice or request by Promus  made
pursuant to the provisions  hereof  without  requirement  of  investigating  the
accuracy or  authenticity  of such  written  notice or any facts or  allegations
contained therein.

         You agree to notify  Promus by certified  mail at 755  Crossover  Lane,
Memphis, Tennessee 38117-4900, Attention: General Counsel (or such other address
as Promus may specify in a written  notice to you) of any action  regarding  the
Hotel to: (a) terminate the Percentage  Lease; (b) petition for appointment of a
Receiver or Trustee for Lessee to take any action under Federal  Bankruptcy  law
or similar state laws; or (c) take possession of the Hotel,  through a Successor
Lessee or otherwise, without termination of the Percentage Lease.

         The rights, powers and interests of Promus hereunder may be transferred
and assigned by Promus,  without the prior written consent of Fee Owner,  Lessee
and, if  applicable,  any  Successor  Lessee,  to any person to whom the License
Agreement and Management  Agreement may be assigned.  The rights and obligations
of Fee Owner,  Lessee and, if  applicable,  Successor  Lessee  hereunder are not
transferable without the written consent of Promus.

         Subject to the  foregoing  limitations,  this  letter  agreement  shall
extend to, and shall bind, the respective  successors and assigns of Promus, Fee
Owner, Lessee and, if applicable, any Successor Lessee, provided,  however, that
in the  case of Fee  Owner,  this  letter  agreement  shall  not  extend  to any
transferee  of Fee Owner's  fee  interest in the Hotel nor to Fee Owner if Apple
Suites, Inc. is not a publicly held REIT.


                                       9
<PAGE>

                  Please  indicate your  agreement with the terms of this letter
agreement by signing and returning four executed  copies to Promus.  This letter
may be executed by original  signature or by  signature  received by telecopy in
any number of  counterparts,  each of which shall be  original  and all of which
together shall constitute and be construed as one and the same instrument.

                                         Very truly yours,

                                         PROMUS HOTELS, INC.


                                         By  /s/  Mariel C. Albrecht
                                             ----------------------------------
                                             Name:  Mariel C. Albrecht
                                             Title: Senior Vice President

cc:      Franchise Administration

Accepted and Agreed:

APPLE SUITES, INC.


By  /s/  Glade M. Knight
   ----------------------------------
   Name:  Glade M. Knight
   Title: President and Chairman


Acknowledged and Agreed:

APPLE SUITES MANAGEMENT, INC.


By  /s/  Glade M. Knight
   ----------------------------------
    Name:  Glade M. Knight
    Title: President, CEO and Chairman