Exhibit 10.18

TOWNEPLACE
SUITES BY MARRIOTT HOTEL

RELICENSING
FRANCHISE AGREEMENT

BETWEEN

MARRIOTT
INTERNATIONAL, INC.

AND

APPLE
TEN HOSPITALITY MANAGEMENT, INC.

Location:
250 East Exchange Blvd., Columbia, SC 29209

Dated
as of: March 25, 2011

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TABLE
OF CONTENTS

|   |                                                                          |                                                                           |    |     
|-- | ------------------------------------------------------------------------ | ------------------------------------------------------------------------- | -- | ----
|   |                                                                          |                                                                           |    | Page
|  
|1. | DEFINITIONS                                                              |                                                                           | 2 
|   |                                                                          |                                                                           |    |     
|2. | LICENSE                                                                  |                                                                           | 10
|   |                                                                          |                                                                           |    |     
|   | 2.1                                                                      | Limited Grant                                                             |    | 10  
|   | 2.2                                                                      | Franchisors Reserved Rights                                              |    | 10  
|   | 2.3                                                                      | Territory                                                                 |    | 10  
|   |                                                                          |                                                                           |    |     
|3. | FEES                                                                     |                                                                           | 11
|   |                                                                          |                                                                           |    |     
|   | 3.1                                                                      | Application Fee                                                           |    | 11  
|   | 3.2                                                                      | Franchise Fees                                                            |    | 11  
|   | 3.3                                                                      | Marketing Fund Charges; Special Marketing
 Program Fees                   |    | 11  
|   | 3.4                                                                      | Electronic Systems Fees                                                   |    | 11  
|   | 3.5                                                                      | Other Charges                                                             |    | 12  
|   | 3.6                                                                      | Travel Expenses and Reimbursement                                         |    | 12  
|   | 3.7                                                                      | Marriott Agreement Payments                                               |    | 12  
|   | 3.8                                                                      | Making of Payments and Performance of
 Services                           |    | 12  
|   | 3.9                                                                      | Interest on Late Payments                                                 |    | 12  
|   | 3.10                                                                     | Taxes                                                                     |    | 12  
|   |                                                                          |                                                                           |    |     
|4. | TERM                                                                     |                                                                           | 13
|   |                                                                          |                                                                           |    |     
|   | 4.1                                                                      | Term                                                                      |    | 13  
|   | 4.2                                                                      | Not Renewable                                                             |    | 13  
|   |                                                                          |                                                                           |    |     
|5. | SIZE, FINANCING, CONSTRUCTION, AND
 RENOVATION                           |                                                                           | 13
|   |                                                                          |                                                                           |    |     
|   | 5.1                                                                      | Size                                                                      |    | 13  
|   | 5.2                                                                      | Financing of the Hotel                                                    |    | 13  
|   | 5.3                                                                      | Construction/Conversion/Renovation of the
 Hotel                          |    | 14  
|   |                                                                          |                                                                           |    |     
|6. | SOURCING AND DESIGN APPROVALS                                            |                                                                           | 14
|   |                                                                          |                                                                           |    |     
|   | 6.1                                                                      | Furniture, Fixtures, Equipment, Supplies,
 and Signage                    |    | 14  
|   | 6.2                                                                      | Design Approval                                                           |    | 15  
|   |                                                                          |                                                                           |    |     
|7. | LOCAL ADVERTISING AND MARKETING, PRICING,
 AND MARKETING FUND ACTIVITIES |                                                                           | 16
|  
|   | 7.1                                                                      | Franchisees Local Advertising and
 Marketing Programs and Press Releases |    | 16  
|   | 7.2                                                                      | Reservations, Pricing, and Rates                                          |    | 16  
|   | 7.3                                                                      | Marketing Fund Activities                                                 |    | 17  
|   | 7.4                                                                      | Special Marketing Programs                                                |    | 18  
|   |                                                                          |                                                                           |    |     
|8. | PROPERTY SYSTEM, RESERVATION SYSTEM, AND
 OTHER ELECTRONIC SYSTEMS       |                                                                           | 18
|   |                                                                          |                                                                           |    |     
|   | 8.1                                                                      | Systems Installation                                                      |    | 18  
|   | 8.2                                                                      | Reservation System                                                        |    | 18  
|   | 8.3                                                                      | Optional System(s)                                                        |    | 19  
|   | 8.4                                                                      | System Communication Costs                                                |    | 19  
|   | 8.5                                                                      | Electronic Systems Provided Under License                                 |    | 19  

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|    |                                                      |                                                                                             |    |   
|--- | ---------------------------------------------------- | ------------------------------------------------------------------------------------------- | -- | --
|9.  | OPERATIONS                                           |                                                                                             | 19
|    |                                                      |                                                                                             |    |   
|    | 9.1                                                  | Operating the Hotel                                                                         |    | 19
|    | 9.2                                                  | System Promotion and Diversion to Other
 Businesses                                         |    | 20
|    | 9.3                                                  | Employees                                                                                   |    | 21
|    | 9.4                                                  | Management and Operation of the Hotel                                                       |    | 21
|    |                                                      |                                                                                             |    |   
|10. | TRAINING, COUNSELING, AND ADVISORY SERVICES          |                                                                                             | 22
|    |                                                      |                                                                                             |    |   
|    | 10.1                                                 | Training                                                                                    |    | 22
|    | 10.2                                                 | Counseling and Advisory Services                                                            |    | 23
|    |                                                      |                                                                                             |    |   
|11. | PHYSICAL FACILITIES, SUPPLIES, AND GOODS             |                                                                                             | 23
|   
|    | 11.1                                                 | Repairs and Maintenance                                                                     |    | 23
|    |                                                      |                                                                                             |    |   
|12. | SYSTEM AND STANDARDS; FRANCHISEE
 ASSOCIATION        |                                                                                             | 25
|    |                                                      |                                                                                             |    |   
|    | 12.1                                                 | Compliance with System and Standards                                                        |    | 25
|    | 12.2                                                 | Modification of the System and Standards                                                    |    | 25
|    | 12.3                                                 | Franchisee Association                                                                      |    | 25
|    |                                                      |                                                                                             |    |   
|13. | PROPRIETARY MARKS AND INTELLECTUAL PROPERTY          |                                                                                             | 25
|    |                                                      |                                                                                             |    |   
|    | 13.1                                                 | Franchisors Representations and
 Responsibility Regarding the Proprietary Marks            |    | 25
|    | 13.2                                                 | Franchisees Use of System and Intellectual
 Property                                       |    | 26
|    | 13.3                                                 | Franchisees Use of Other Marks                                                             |    | 28
|    | 13.4                                                 | Internet
 Website                                                                           |    | 28
|    |                                                      |                                                                                             |    |   
|14. | CONFIDENTIAL INFORMATION; DATA PROTECTION
 LAWS      |                                                                                             | 29
|    |                                                      |                                                                                             |    |   
|    | 14.1                                                 | Confidential Information                                                                    |    | 29
|    | 14.2                                                 | Data Protection Laws                                                                        |    | 29
|    |                                                      |                                                                                             |    |   
|15. | ACCOUNTING AND REPORTS                               |                                                                                             | 29
|    |                                                      |                                                                                             |    |   
|    | 15.1                                                 | Books, Records, and Accounts                                                                |    | 29
|    | 15.2                                                 | Reports                                                                                     |    | 30
|    | 15.3                                                 | Franchisor Examination and Audit of Hotel
 Records                                          |    | 30
|    |                                                      |                                                                                             |    |   
|16. | INDEMNIFICATION AND INSURANCE                        |                                                                                             | 31
|    |                                                      |                                                                                             |    |   
|    | 16.1                                                 | Indemnification                                                                             |    | 31
|    | 16.2                                                 | Insurance                                                                                   |    | 31
|    |                                                      |                                                                                             |    |   
|17. | TRANSFERABILITY OF INTERESTS                         |                                                                                             | 33
|    |                                                      |                                                                                             |    |   
|    | 17.1                                                 | Transfers of Interests in the Hotel and
 Franchisee                                         |    | 33
|    | 17.2                                                 | Transfers of Controlling Ownership
 Interests                                               |    | 34
|    | 17.3                                                 | Transfers of Passive Investor Interests,
 Estate Planning, and Death or Mental Incompetency |    | 36
|    | 17.4                                                 | Proposed Transfer to Competitor and Right
 of First Refusal                                 |    | 37
|    | 17.5                                                 | Interest in Real Estate and Injunctive
 Relief                                              |    | 39
|    | 17.6                                                 | Survival of Right of First Refusal                                                          |    | 39
|    | 17.7                                                 | Security Interests in the Hotel or Franchisee                                               |    | 39
|    | 17.8                                                 | Proposed Transfers to Specially Designated
 National or Blocked Person                      |    | 40
|    | 17.9                                                 | Transfers by Franchisor                                                                     |    | 40
|    |                                                      |                                                                                             |    |   
|18. | PUBLICLY-TRADED SECURITIES AND SECURITIES
 OFFERINGS |                                                                                             | 40
|    |                                                      |                                                                                             |    |   
|    | 18.1                                                 | Franchisees Obligations                                                                    |    | 40

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|    |                                                                                   |                                                                         |    |   
|--- | --------------------------------------------------------------------------------- | ----------------------------------------------------------------------- | -- | --
|    | 18.2                                                                              | Limited Franchisor Consent                                              |    | 41
|    |                                                                                   |                                                                         |    |   
|19. | DEFAULT AND TERMINATION                                                           |                                                                         | 41
|    |                                                                                   |                                                                         |    |   
|    | 19.1                                                                              | Immediate Termination                                                   |    | 41
|    | 19.2                                                                              | Termination Upon Notice with Opportunity to
 Cure                       |    | 43
|    | 19.3                                                                              | Termination by Franchisor and Liquidated
 Damages                       |    | 43
|    |                                                                                   |                                                                         |    |   
|20. | POST-TERMINATION                                                                  |                                                                         | 46
|    |                                                                                   |                                                                         |    |   
|    | 20.1                                                                              | Franchisee Obligations                                                  |    | 46
|    | 20.2                                                                              | Franchisors Rights Upon Termination or
 Expiration                     |    | 48
|    | 20.3                                                                              | Survival                                                                |    | 48
|    |                                                                                   |                                                                         |    |   
|21. | CONDEMNATION AND CASUALTY                                                         |                                                                         | 48
|    |                                                                                   |                                                                         |    |   
|    | 21.1                                                                              | Condemnation                                                            |    | 48
|    | 21.2                                                                              | Casualty                                                                |    | 48
|    |                                                                                   |                                                                         |    |   
|22. | COMPLIANCE WITH LAWS; LEGAL ACTIONS                                               |                                                                         | 49
|    |                                                                                   |                                                                         |    |   
|    | 22.1                                                                              | Compliance with Laws                                                    |    | 49
|    | 22.2                                                                              | Notice Regarding Legal Actions                                          |    | 49
|    | 22.3                                                                              | WAIVER OF JURY TRIAL AND PUNITIVE DAMAGES                               |    | 49
|    | 22.4                                                                              | Specially Designated National or Blocked
 Person; Anti-Money Laundering |    | 49
|    |                                                                                   |                                                                         |    |   
|23. | RELATIONSHIP OF PARTIES                                                           |                                                                         | 50
|    |                                                                                   |                                                                         |    |   
|    | 23.1                                                                              | Reasonable Business Judgment                                            |    | 50
|    | 23.2                                                                              | Independent Contractor                                                  |    | 50
|    |                                                                                   |                                                                         |    |   
|24. | GOVERNING LAW; INJUNCTIVE RELIEF; COSTS OF
 ENFORCEMENT                           |                                                                         | 50
|    | 24.1                                                                              | Governing Law                                                           |    | 50
|    | 24.2                                                                              | Injunctive Relief                                                       |    | 51
|    | 24.3                                                                              | Costs of Enforcement                                                    |    | 51
|    |                                                                                   |                                                                         |    |   
|25. | NOTICES                                                                           |                                                                         | 51
|    |                                                                                   |                                                                         |    |   
|    | 25.1                                                                              | Notices                                                                 |    | 51
|    |                                                                                   |                                                                         |    |   
|26. | CONSTRUCTION AND SEVERABILITY; APPROVALS,
 CONSENTS AND WAIVERS; ENTIRE AGREEMENT |                                                                         | 52
|    |                                                                                   |                                                                         |    |   
|    | 26.1                                                                              | Construction and Severability                                           |    | 52
|    | 26.2                                                                              | Approvals, Consents and Waivers                                         |    | 53
|    | 26.3                                                                              | Entire Agreement                                                        |    | 53
|    | 26.4                                                                              | Amendments                                                              |    | 53
|    |                                                                                   |                                                                         |    |   
|27. | REPRESENTATIONS, WARRANTIES AND COVENANTS                                         |                                                                         | 53
|    |                                                                                   |                                                                         |    |   
|    | 27.1                                                                              | Existence and Power; Authorization;
 Contravention                      |    | 53
|    | 27.2                                                                              | Ownership of Franchisee                                                 |    | 54
|    | 27.3                                                                              | Ownership of the Hotel                                                  |    | 54
|    | 27.4                                                                              | Additional Franchisee Acknowledgments and
 Representations              |    | 54
|    |                                                                                   |                                                                         |    |   
|28. | MISCELLANEOUS                                                                     |                                                                         | 55
|    |                                                                                   |                                                                         |    |   
|    | 28.1                                                                              | Confidential Negotiated Changes                                         |    | 55
|    | 28.2                                                                              | Multiple Counterparts                                                   |    | 56

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|                                                                                         |                                                       |    |    | 
|---------------------------------------------------------------------------------------- | ----------------------------------------------------- | -- | -- | 
|EXHIBIT A APPROVED LOCATION, NUMBER OF
 GUESTROOMS AND OWNERSHIP INTERESTS IN FRANCHISEE |                                                       | 57
|                                                                                         |                                                       |   
|EXHIBIT B CHANGE OF OWNERSHIP RIDER                                                      |                                                       | 58
|                                                                                         |                                                       |   
|PROPERTY IMPROVEMENT PLAN ADDENDUM                                                       |                                                       | 60
|                                                                                         | ATTACHMENT ONE TO PROPERTY IMPROVEMENT PLAN
 ADDENDUM |    | 63
|                                                                                         | ATTACHMENT TWO TO PROPERTY IMPROVEMENT PLAN
 ADDENDUM |    | 65
|                                                                                         |                                                       |   
|EXHIBIT C RESTRICTED TERRITORY MAP                                                       |                                                       | 66

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RELICENSING FRANCHISE AGREEMENT

This
Relicensing Franchise Agreement is effective as of the 25th day of
March, 2011 (Effective Date) by Marriott International, Inc., a Delaware
corporation and Apple Ten Hospitality Management, Inc., a Virginia corporation
(Franchisee).

RECITALS

A.
Franchisor owns the System.

B. Columbia
East Hospitality, Inc. (Existing Franchisee) and Franchisor are parties to a
System Hotel franchise agreement dated June 18, 2007 (Existing Franchise
Agreement) for the operation of the Hotel (defined below).

C. Existing
Franchisee has entered into a Purchase Contract (Purchase Agreement) with
Apple Ten Business Trust, a Virginia trust (Owner), an affiliate of
Franchisee, pursuant to which Owner has purchased the Hotel from Existing
Franchisee (the Hotel Purchase Transaction).

D. Existing
Franchisee desires to terminate the Existing Franchise Agreement in connection
with the consummation of the Hotel Purchase Transaction.

E.
Franchisor has agreed to terminate the Existing Franchise Agreement on the
terms set forth in a Termination Agreement and Release between Existing
Franchisee and Franchisor (the Termination Agreement).

F. Pursuant
to the Termination Agreement, the termination of the Existing Franchise
Agreement is not effective unless, among other things, this Agreement has
become effective in accordance with its terms.

G.
Franchisee desires that the Hotel remain in the System after termination of the
Existing Franchise Agreement and Franchisee desires to operate the Hotel under
Franchisors System at the location specified herein and to obtain a franchise
from Franchisor for that purpose.

H. The
Hotel opened for business as a System Hotel on May 21, 2009 (the Opening
Date), and was operated under Franchisors System from the Opening Date until
termination of the Existing Franchise Agreement pursuant to the Termination
Agreement.

I. Certain
modifications to this Agreement are required in order to account for the fact
that the Hotel was opened and operating before the Effective Date, which are
set forth in the Change of Ownership Rider attached hereto as Exhibit B.

J.
Franchisee has entered into a lease dated March 25, 2011 (the Lease) with
Owner, pursuant to which Owner has leased the Hotel to Franchisee and
Franchisee has rights to operate the Hotel, and Franchisee desires to operate
the Hotel as a System Hotel and wishes to obtain a license to use the System and
the Proprietary Marks for that purpose.

K. Owner,
Franchisor and Franchisee are parties to that certain Owner Agreement dated as
of the date hereof with respect to the Hotel (the Owner Agreement).

L. It is
the intention of the parties that the Hotel, together with other System Hotels
will be part of a chain of hotels providing distinctive, high quality hotel
services.

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M. It is
important that the Hotel be operated in strict conformity with the System in
order to enhance public acceptance of, and demand for, all System Hotels.

N. In
agreeing to grant the non-exclusive license under this Agreement to Franchisee,
Franchisor is relying upon the business skill, financial capacity, and
character of Franchisee and its principals and the guarantee by Guarantor under
the Guaranty.

NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
in this Agreement, and for other good and valuable consideration, the receipt
and sufficiency of which are acknowledged, Franchisee and Franchisor agree as
follows:

|   |            
|-- | -----------
|1. | DEFINITIONS

When used
in this Agreement the following terms have the meanings indicated:

AAA
Rules has the meaning stated in Section 17.4.

Accounting
Period means any one of the twelve (12) months in a calendar year or any
other fiscal accounting and reporting period used by Franchisee and approved by
Franchisor in writing.

Affiliate
means, for any Person, a Person that is directly (or indirectly through one or
more intermediaries) Controlling, Controlled by, or under common Control with,
such Person.

Agreement
means this Franchise Agreement, including any exhibits, attachments, and
addenda.

Applicable
Law means all laws, regulations, ordinances, rules, orders, decrees, and
requirements of any governmental authority having jurisdiction over the Hotel,
Franchisee, Guarantor or any of the Marriott Agreements.

Application
Fee has the meaning stated in Section 3.1.

Approved
Location means the site or parcel of land described under item 1 on
Exhibit A.

Arbitrator
has the meaning stated in Section 17.4.

Association
has the meaning stated in Section 12.3.

Brand
has the meaning stated in the definition of Competitor.

Case
Goods means furniture and fixtures used in the Hotel, its Guestrooms, and
its Public Facilities, such as chests, armoires, chairs, beds, headboards,
desks, tables, television sets, mirrors, pictures, wall decorations, graphics
and all other unspecified items of the same class.

Category
means a group of System Hotels designated by Franchisor or its Affiliates, in
their sole discretion, based upon certain criteria, such as geographic (e.g.,
worldwide, regional, state-specific, country-specific) or other attributes
(e.g., resorts, urban, suburban). A Category may have specific physical and
operating standards and policies or may be a descriptive classification.

Competitor
means any Person that owns or has an interest in a hotel brand, trade name,
trademark, system, or chain (a Brand) or any Person that has, directly or
indirectly, an Ownership Interest in, or is an Affiliate, principal, director,
officer, or other individual with management responsibility of, a Person that
owns or has an interest in a Brand that is comprised of at least (i) twenty

2

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(20) full-service hotels, or (ii) fifty (50) limited-service hotels.
For the purposes of defining Competitor, full-service hotels are hotels
that typically offer three (3) meals per day and have an average of three
thousand (3,000) square feet or more of meeting space per hotel, and
limited-service hotels are hotels that are not full-service hotels. No
Person will be deemed to be a Competitor if such Person has an interest in a
Brand merely as a franchisee or as a mere passive investor that has no Control
or influence over the business decisions concerning the Brand at issue, such as
limited partners in a partnership or as a mere non-Controlling stockholder in a
corporation.

Competitor
Liquidated Damages has the meaning stated in Section 19.3.C.

Confidential
Information means any or all of the following information: (i) any
Standards, documents, or trade secrets approved for use in the System or in the
design, construction, renovation or operation of the Hotel; (ii) any
Electronic Systems and accompanying documentation developed for the System or
elements thereof; (iii) Guest Profile Data; or (iv) any other confidential
information, knowledge, trade secrets, business information or know-how
obtained (a) through the use of any part of the System or concerning the System
or the operation of the Hotel or (b) under any Marriott Agreements.

Control
(and any form thereof, such as Controlling or Controlled) means, for any
Person, the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of such Person.

Control
Affiliate means an Affiliate of Franchisee that directly or indirectly
Controls Franchisee.

Data
Protection Laws means data protection and privacy laws and regulations in
the United States.

Design
Criteria means those Standards that comprise the design criteria and such
other information that is necessary for planning and construction or renovation
and refurbishment of a System Hotel.

Dispute
means any dispute, controversy, or claim arising out of or relating to this
Agreement or any other Marriott Agreement, or the making, breach, termination,
or invalidity of this Agreement or any other Marriott Agreement, or the
relationship created by any of those agreements.

Effective
Date has the meaning stated in the preamble to this Agreement.

Electronic
Systems means all Software, Hardware and all electronic access to
Franchisors systems and data, licensed or made available to Franchisee
relating to the System, including the Reservation System, the Property System,
the Yield Management System, and any other system established under Section 8.3
or Section 12.2.

Electronic
Systems Fees means the Reservation System Fee, the Property System Fee,
the Yield Management System Fee, and the fees for any other system established
under Section 8.3 or Section 12.2.

Electronic
Systems License Agreement means the electronic systems license agreement
that must be executed by Franchisee as a condition to using the Electronic
Systems, the current form of which is set forth in the Franchise Disclosure
Document.

Existing
Franchisee has the meaning stated in the Recitals.

3

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Existing
Franchise Agreement has the meaning stated in the Recitals.

FF&E
means Case Goods, Soft Goods, signage, and equipment (including telephone
systems, facsimile machines, copiers, vending machines, games, and electronic
systems, such as equipment needed for the Electronic Systems), but does not
include any item included in Fixed Asset Supplies.

Financed
Pool has the meaning stated in Section 5.2.

Fixed
Asset Supplies means supply items included within Property and Equipment
under the Uniform System, including linen, china, glassware, silver, uniforms,
and similar items.

Franchise
Disclosure Document means that certain document provided by Franchisor to
prospective franchisees of System Hotels as required by the trade regulation
rule of the Federal Trade Commission entitled Disclosure Requirements and
Prohibitions Concerning Franchising, as such document may be updated from time
to time by Franchisor.

Franchisee
has the meaning stated in the preamble to this Agreement.

Franchise
Fees has the meaning stated in Section 3.2.

Franchisor
means Marriott International, Inc., a Delaware corporation, and its successors
and assigns.

Franchisor
Lodging Facilities means all hotels and other lodging facilities, chains,
brands, or hotel systems owned, leased, under development, or operated or
franchised, now or in the future, by Franchisor or any of its Affiliates,
including: (i) Marriott Hotels, Resorts and Suites; Marriott Marquis Hotels; JW
Marriott Hotels and Resorts; Marriott Conference Centers; Marriott Executive
Apartments; Courtyard by Marriott Hotels; Fairfield Inn by Marriott Hotels;
Fairfield Inn & Suites by Marriott Hotels; Nickelodeon Resorts by Marriott; Renaissance Hotels and Resorts;
Renaissance ClubSport; Autograph Collection Hotels; Residence Inn by Marriott
Hotels; Bvlgari Hotels and Resorts; Edition Hotels; Ritz-Carlton Hotels and
Resorts; SpringHill Suites by Marriott Hotels; and TownePlace Suites by
Marriott Hotels; (ii) other lodging products or concepts, including
Marriott ExecuStay; JW Marriott Residences; Marriott Marquis Residences; and
The Residences at The Ritz-Carlton; (iii) vacation, timesharing, interval
or fractional ownership facilities, including Marriott Vacation Club
International, The Ritz-Carlton Club, and Horizons by Marriott Vacation Club;
and (iv) any other lodging product or concept developed or utilized by
Franchisor or any of its Affiliates in the future.

Frequent
Traveler Program(s) means the frequent traveler appreciation program(s)
for System Hotels and such other Franchisor Lodging Facilities designated by
Franchisor or its Affiliates designed to increase the market share, length of
stay and frequency of usage of such Franchisor Lodging Facilities, and/or any
similar, complementary, or successor program. As of the Effective Date, such programs
include Marriott Rewards.

Gross
Revenues means gross revenues and receipts of every kind (without netting
for charge backs, credit card service charges, or uncollectible amounts), from
all parts of and in connection with the Hotel, including revenues from leases,
rentals, memberships, concessions, service charges, fees, sales, Gross Room
Sales and revenues and receipts from all other operations, but not including
any: (a) tips, service charges, or gratuities to Hotel employees to the extent
actually received by the Hotel employees; (b) proceeds from the sale of the
Hotels FF&E; (c) proceeds from insurance policies, other than business

4

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interruption, loss of income or other similar insurance for the Hotel;
or (d) any sales tax, value added tax, or similar taxes.

Gross
Room Sales means: (i) gross sales and receipts of every kind that accrue
from the rental of Guestrooms (without netting for charge backs, credit card
service charges, or uncollectible amounts), including no-show revenue, early
departure fees, late check-out fees and other revenues allocable to rooms
revenue pursuant to the Uniform System, but not including any sales tax, value
added tax, or similar taxes; (ii) resort fees and mandatory surcharges for facilities
(although inclusion of such fees or surcharges does not constitute approval by
Franchisor of such fees and surcharges, which may be limited or prohibited by
Franchisor); (iii) attrition or cancellation fees that are collected from
groups that cancel or do not fulfill their guaranteed number of reservations
for Guestrooms; and (iv) the amount of all lost revenues and receipts due to
the non-availability of Guestrooms, upon which business interruption, loss of
income, or other similar insurance proceeds are calculated.

Guarantor
means individually and collectively the Person(s) who guarantee(s) the
performance of Franchisees obligations under this Agreement and the other
Marriott Agreements under the Guaranty.

Guaranty
means a guaranty executed and delivered by Guarantor for the benefit of
Franchisor, the current form of which is set forth in the Franchise Disclosure
Document.

Guest
Profile Data means personal guest profiles and information regarding guest
preferences, including any information derived from or contained in any
Frequent Traveler Program.

Guestroom
means each rentable unit in the Hotel consisting of a room, suite or suite of
rooms generally used for overnight guest accommodation, entrance to which is
controlled by the same key; provided that adjacent rooms with connecting doors
that can be locked and rented as separate units are considered separate
Guestrooms.

Hardware
means all computer hardware and other equipment (including all future upgrades,
enhancements, additions, substitutions, and other modifications thereof)
required for the operation of and connection to any Electronic System.

Hotel
means the hotel and all land used in connection with the hotel located or to be
located at the Approved Location, including: (i) the freehold or long-term
leasehold title to the Approved Location; (ii) all improvements, structures,
facilities, entry and exit rights, parking, pools, landscaping, and other
appurtenances (including the hotel building, Public Facilities, and all
operating systems) located at the Approved Location; and (iii) all FF&E,
Fixed Asset Supplies, and Inventories installed or located in such improvements
at the Approved Location.

Hotel
Purchase Transaction has the meaning stated in the Recitals.

Initial
Accounting Period has the meaning stated in Section 3.11.

Intellectual
Property means all of the following items, regardless of the form or
medium involved (e.g., paper, electronic, tape, tangible or intangible): (i)
all Software, including the data and information processed or stored by such
Software; (ii) all Proprietary Marks; (iii) all Confidential Information; and
(iv) all other information, materials, and copyrightable or patentable subject
matter owned, developed, acquired, licensed, or used by Franchisor or any of
its Affiliates in connection with the System.

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Interestholders
means, with respect to any Person, any Person that directly or indirectly holds
an Ownership Interest in that Person.

Interest
Rate means the lesser of eighteen percent (18%) per annum or the maximum
interest rate permitted by law.

Inventories
means Inventories as defined in the Uniform System, including: (i) provisions
in storerooms, refrigerators, pantries, and kitchens; (ii) beverages in
wine cellars and bars; (iii) other merchandise intended for sale;
(iv) fuel; (v) mechanical supplies; (vi) stationery; and
(vii) other expensed supplies and similar items.

Inventory
Management means those inventory management services made available by
Franchisor to Franchisee under optional revenue management consulting
arrangements.

Lease
has the meaning stated in the Recitals to this Agreement.

Local
Advertising Programs means local advertising, marketing, promotional,
sales and public relations programs and activities for the Hotel, and Marketing
Materials used in connection therewith.

Management
Company has the meaning stated in Section 9.4.A.

Management
Company Acknowledgment means an acknowledgment signed by the Management
Company, Franchisee and Franchisor, the current form of which is set forth in
the Franchise Disclosure Document.

Marketing
Fund Activities means: (i) the creation, production, and administration of
Marketing Materials; (ii) the placement of Marketing Materials in magazines,
newspapers, and similar printed, digital or electronic media or social media
sites; (iii) the purchase of advertising on radio, television, the Internet,
and other electronic or digital media; (iv) advertising, marketing,
promotional, public relations, revenue management, reservations activities and
sales campaigns, programs, seminars and other activities designed to increase
sales or public awareness of the System, including publication and distribution
of directories (whether offline or online), pamphlets and other forms of
advertising media; (v) market research and oversight and management of the
guest satisfaction program and Frequent Traveler Programs; and (vi) the
retention or employment of personnel, advertising agencies, marketing
consultants, and other professionals or specialists to assist in the
development and implementation of any of the foregoing.

Marketing
Fund Charge has the meaning stated in Section 3.3.A.

Marketing
Funds means monies collected and used by Franchisor and its Affiliates for
Marketing Fund Activities.

Marketing
Materials means all advertising, marketing, promotional, sales and public
relations concepts, press releases, materials, copy, concepts, plans, programs,
brochures, or other information to be released to the public, whether in paper,
digital, electronic or computerized form, or in any form of media now or
hereafter developed.

Marriott
Agreement(s) means, collectively, this Agreement, any other agreements
executed in connection with this Agreement, and any other agreement related to
the Hotel to which Franchisee, Guarantor or any of their respective Affiliates
is a party and to which Franchisor or its Affiliates is also a party or
beneficiary, as any may be amended, modified, supplemented, or restated.

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Opening
Date has the meaning stated in the Recitals.

Other Mark(s)
means any trademark, trade name, symbol, slogan, design, insignia, emblem,
device, or service mark that is not a Proprietary Mark.

Owner
has the meaning stated in the Recitals to this Agreement.

Owner
Agreement has the meaning stated in the Recitals to this Agreement.

Ownership
Interest means all forms of ownership of legal entities or property, both
legal and beneficial, voting and non-voting, including stock interests,
partnership interests, limited liability company interests, joint tenancy
interests, leasehold interests, proprietorship interests, trust beneficiary
interests, proxy interests, power-of-attorney interests, and all options,
warrants, and any other forms of interest evidencing ownership or
Control.

Passive
Investor Interests has the meaning stated in Section 17.3.

Person
means an individual, a partnership, a corporation, a limited liability company,
a government, or any department or agency thereof, a trustee, a trust, an unincorporated
organization, or any other entity of any kind.

PIP
has the meaning stated in Section 17.2.A(1)(d).

Property
System means all property systems (including all Software, Hardware and
electronic access related thereto) designated by Franchisor for use by System
Hotels in the front office, back-of-the-house, or other operations of System
Hotels.

Property
System Fee means the fee Franchisee must pay as required by Franchisor
representing the Hotels share of the costs and expenses of the Property
System, including development and incremental operating costs, ongoing
maintenance, field support costs, and a reasonable return on capital.

Proprietary
Marks means any trademarks, trade names, trade dress, words, symbols,
logos, slogans, designs, insignia, emblems, devices, service marks, and indicia
of origin (including restaurant names,
lounge names, or other outlet names), or combinations thereof, that are
registered by Franchisor or any of its Affiliates, or are used to identify or
are otherwise associated by virtue of usage with System Hotels, all as may be
changed, deleted, added to or otherwise modified by Franchisor or its
Affiliates in their sole discretion. The term applies whether the Proprietary
Marks are owned currently by Franchisor or any of its Affiliates, or are later
developed or acquired, and whether or not they are registered in any state,
foreign country or in the United States Patent and Trademark Office.

Prospectus
means any registration statement, solicitation, prospectus (preliminary or
otherwise), memorandum, offering document, or similar documentation for the
sale or transfer of an Ownership Interest, including any related amendments.

Public
Facilities means any meeting rooms, conference rooms, convention or
banquet facilities, restaurants, bars, lounges, and all other similar public
facilities.

Purchase
Agreement has the meaning stated in the Recitals.

Quality
Assurance Program means the quality assurance program that Franchisor uses
to monitor guest satisfaction and the operations, facilities and services at
System Hotels.

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Reasonable
Business Judgment has the meaning stated in Section 23.1.

Renovation
Drawings has the meaning stated in Section 6.2.A.

Reserve
means the reserve account established by Franchisee meeting the requirements of
Section 11.2.A.

Reservation
System means any reservation system designated by Franchisor for System
Hotels (including all Software, Hardware and electronic access related
thereto).

Reservation
System Fee means the fee Franchisee must pay to Franchisor representing
the Hotels share of the costs and expenses of the Reservation System,
including development and incremental operating costs, ongoing maintenance,
field support costs, and a reasonable return on capital.

Restricted
Territory has the meaning stated in Section 2.3.

Sales
Agent means Franchisor acting on behalf of Franchisee for purposes of (i)
Inventory Management, (ii) booking reservations at the Hotel or other booking
activities, including accessing the Reservation System, or (iii) sales
activities, including arranging group sales. Where Franchisor is Sales Agent for
Franchisee, Franchisee consigns hotel inventory to Franchisor and retains all
risk of loss of unsold or cheaply sold inventory.

Soft
Goods means textile, fabric and vinyl and similar products used in
finishing and decorating the Hotel, its Guestrooms, corridors and Public
Facilities, such as vinyl wall and floor coverings, drapes, sheers, cornice
coverings, carpeting, bedspreads, lamps, lamp shades, artwork, task chairs,
upholstery and all other unspecified items of the same class.

Software
means all computer software and accompanying documentation (including all
future enhancements, upgrades, additions, substitutions, and other
modifications) provided to Franchisee by or through Franchisor and/or third
parties designated by Franchisor or its Affiliates required for the operation
of and connection to any Electronic System.

Special
Circumstances has the meaning stated in Section 19.3.B.

Special
Circumstances Liquidated Damages has the meaning stated in Section 19.3.B.

Specially
Designated National or Blocked Person means: (i) a Person designated by
the U.S. Department of Treasurys Office of Foreign Assets Control from time to
time as a specially designated national or blocked person or similar status;
(ii) a Person described in Section 1 of U.S. Executive Order 13224, issued on
September 23, 2001; or (iii) a Person otherwise identified by government or
legal authority as a Person with whom Franchisor, or any of its Affiliates, are
prohibited from transacting business.

Special
Marketing Programs means, as further described in Section 7.4,
advertising, marketing, promotional, public relations, and sales programs and
activities that are not designated by Franchisor as Marketing Fund Activities.

Standards
means Franchisors operating rules, manuals, standard operating procedures and
other procedures, systems, guides, programs (including the Quality Assurance
Program), requirements, directives, standards, specifications, design criteria,
and such other information, initiatives and controls that are necessary for
planning, designing, constructing, renovating, refurbishing, and operating
System

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Hotels (including the Design Criteria), as such may be modified,
amended or supplemented by Franchisor or its Affiliates in accordance with
Section 12.2 (and which may, with Franchisors prior approval, take into
account specific characteristics and conditions of the local market). The
Standards may be in paper or in electronic form.

System
means the Standards, Intellectual Property and other distinctive,
distinguishing elements or characteristics that Franchisor or its Affiliates
have developed, designated or authorized for the operation of System Hotels as
such may be modified, amended or supplemented by Franchisor or its Affiliates
in accordance with Section 12.2 including: the Reservation System, the Property
System, the Yield Management System, the Electronic Systems, the Software, the
Frequent Traveler Program(s), the Marketing Fund Activities, Special Marketing
Programs, Training Programs, and other advertising programs and training.

System
Hotel means a limited-service hotel operated by Franchisor, an Affiliate
of Franchisor, or a franchisee or licensee of Franchisor or its Affiliates
under the trade name TownePlace Suites by Marriott in any of the fifty (50)
states of the United States of America, the District of Columbia or Canada, and
does not include any other Franchisor Lodging Facility or other business operation.

Taxes
means all taxes (including any sales, gross receipts, value-added or goods and
services taxes), levies, charges, impositions, stamp or other duties, fees,
deductions, withholdings or other payments levied or assessed by any competent
governmental authority, including by any federal, national, state, provincial,
local, or other tax authority.

Term
has the meaning stated in Section 4.1.

Term
Expiration Date has the meaning stated in Section 21.2.

Termination
Agreement has the meaning stated in the Recitals.

Transfer
means any sale, conveyance, assignment, exchange, pledge, encumbrance, lease or
other transfer or disposition, directly or indirectly, voluntarily or
involuntarily, absolutely or conditionally, by operation of law or otherwise.

Transfer
Fee has the meaning stated in Section 17.2.A(1)(c).

Travel
Expenses means all travel, food and lodging, living, and other
out-of-pocket costs and expenses.

Uniform
System means the Uniform System of Accounts for the Lodging Industry,
Tenth Revised Edition, 2006, as published by the Educational Institute of the
American Hotel & Lodging Association, or any later edition, revision or
replacement that Franchisor approves or designates.

Yield
Management System means any yield management system (including all
Software, Hardware and electronic access related thereto) designated or
required by Franchisor for use by System Hotels. The Yield Management System may
be part of the Property System.

Yield
Management System Fee means the fee Franchisee must pay to Franchisor
representing the Hotels share of costs and expenses of the Yield Management
System, including development and incremental operating costs, ongoing
maintenance, field support costs, and a reasonable return on capital.

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|   |        
|-- | -------
|2. | LICENSE

2.1 Limited
Grant.

Upon
the terms of this Agreement, Franchisor hereby grants to Franchisee a limited,
non-exclusive license to use the Proprietary Marks and the System and the right
to operate the Hotel as a System Hotel solely at the Approved Location.
Franchisee agrees to identify and operate the Hotel as a System Hotel in
accordance with the System and this Agreement only as and when authorized by
Franchisor.

2.2 Franchisors
Reserved Rights.

A.
Franchisee agrees that except as set forth below at Section 2.3:
(i) Franchisor and its Affiliates retain the right, at any location other
than the Approved Location, to develop, promote, construct, own, lease, acquire
and/or operate, or authorize or otherwise license or franchise to other Persons
the right to develop, promote, construct, own, lease, acquire and/or operate
Franchisor Lodging Facilities (including other System Hotels) and other
business operations; and (ii) Franchisor or its Affiliates may exercise such
right without notice to Franchisee. Franchisee covenants that it will not do
anything that may interfere with the exercise of such right by Franchisor or
any of its Affiliates.

B.
Nothing in this Agreement will prevent Franchisor from allowing other
Franchisor Lodging Facilities operated or franchised by Franchisor or its
Affiliates to use various components of the System, including the Reservation
System. Franchisor and its Affiliates also have the right to enter into
affiliation agreements with other lodging facilities to permit Frequent
Traveler Program members (or members of similar guest recognition programs) to
redeem awards for stays at such lodging facilities.

2.3 Territory.

Neither
Franchisor nor its Affiliates will open to the public for business or authorize
any other Person to open to the public for business a System Hotel for a period
of three (3) years after the Opening Date of the Hotel, but not to extend
beyond May 1, 2012, within a three (3) mile radius measured from the front door
of the Hotel (Restricted Territory). The Restricted Territory is the
highlighted bordered area as approximately set forth on the map attached hereto
at Exhibit C. Should a conflict exist between the map and the narrative
description stated above, the narrative will control. The restrictions set
forth in this Section 2.3 will not apply to (i) any System Hotel existing or
under development as of the Effective Date within the Restricted Territory;
(ii) any hotel or hotels that are members of a chain of hotels (provided
that such chain has a minimum of four (4) or more hotels in operation), all or
substantially all (but in no event less than three (3) hotels) of which is
acquired by, or merged with, or franchised by or joined through marketing
agreement with, Franchisor or one of its Affiliates (or the operation of which
is transferred to Franchisor or one of its Affiliates); (iii) any hotel or
hotels that are members of a group of hotels that is (in a single transaction,
or combination of related transactions, with a single seller or transferor)
acquired by, or merged with, or franchised by or joined through marketing
agreement with, Franchisor or one of its Affiliates, or the operation of which
is transferred to Franchisor or one of its Affiliates, provided that such group
of hotels contains no fewer than three (3) hotels; (iv) any other Franchisor
Lodging Facility that is not included within the System; or (v) if any existing
hotel described in (i) above ceases to operate as a System Hotel, then for each
such hotel (if any), an additional hotel that may operate as a System Hotel.

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3. FEES

3.1 Application
Fee.

Before
the execution of this Agreement, Franchisee has paid to Franchisor an
application fee in the amount of Fifty Thousand Dollars ($50,000), whichever is
greater (Application Fee) in consideration of Franchisors investigation,
review and approval process and other administrative functions and undertakings
in connection with this Agreement. The Application Fee was earned by Franchisor
upon Franchisors conditional approval of Franchisees application and is non-refundable.

3.2 Franchise
Fees.

Franchisee
must pay to Franchisor an amount equal to five percent (5%) of Gross Room Sales
during each Accounting Period (the Franchise Fees). Franchisee must not
discount or sacrifice Gross Room Sales (by methods including the offering of
complimentary or reduced-price rooms) in order to further any other business at
or outside of the Hotel. Gross Room Sales must be accounted for on an accrual
basis.

3.3 Marketing
Fund Charges; Special Marketing Program Fees.

A.
Franchisee must pay to Franchisor a fee (the Marketing Fund Charge), as the
Hotels contribution for Marketing Fund Activities. The Marketing Fund Charge
is currently one and one-half percent (1.5%) of Gross Room Sales for the
preceding Accounting Period. All sums Franchisor receives under this Section
3.3.A will be used as described in Section
7.3. Franchisor may modify the Marketing Fund Charge for hotels in the
System, including the Hotel, to reflect the following, as determined by
Franchisor: (i) any increase or decrease in the cost of providing, or the scope
of, Marketing Fund Activities; (ii) any change in the method used to allocate
the cost of Marketing Fund Activities; or (iii) any change in the competitive
needs of the System. Franchisee agrees to be bound by any such increase or
decrease; provided the total Marketing Fund Charge in any fiscal year will not
exceed three percent (3%) of Gross Room Sales. System Hotels operated by
Franchisor will make contributions for Marketing Fund Activities at the same
percentage of Gross Room Sales required of franchisees within the System.

B.
Franchisee must pay to Franchisor the Hotels share, as determined by
Franchisor, of the cost of any Special Marketing Program as described in
Section 7.4.

3.4 Electronic
Systems Fees.

A.
Franchisee must pay to Franchisor the Electronic Systems Fees for any
Electronic Systems provided to Franchisee for use at the Hotel.

B.
Franchisor reserves the right to change the basis of the allocation of any
Electronic Systems Fee to reflect the following, as determined by Franchisor:
(i) any increase or decrease in the costs and expenses of providing the
applicable Electronic System to the Hotel; (ii) any change in the method
Franchisor uses to determine the applicable Electronic Systems Fee payment; or
(iii) any change in the competitive needs of the System, including the right to
change the basis for charging for such Electronic Systems Fee, so long as the
charges for the Electronic Systems Fees are computed on a fair and consistent
basis among similarly situated System Hotels or Franchisor Lodging Facilities
receiving the services or utilizing the applicable Electronic Systems at the
time such services and Electronic Systems are utilized.

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3.5 Other
Charges.

Franchisee
must pay to Franchisor or its Affiliates an amount specified by Franchisor to
pay for (i) any training or orientation (including tuition, supplies, and
Travel Expenses) required by Franchisor (including the general manager
conference regardless of whether Franchisees personnel attend) or in which
Franchisee elects to participate, (ii) purchasing, staging, programming, installing
and interfacing and upgrading of Hardware and Software for any Electronic
Systems, (iii) any goods or services purchased, leased or licensed by
Franchisee from Franchisor or an Affiliate of Franchisor, and (iv) any optional
or mandatory programs of Franchisor or its Affiliates in which Franchisee
participates.

3.6 Travel
Expenses and Reimbursement.

Franchisee
must pay to Franchisor all Travel Expenses for: (i) individuals designated by
Franchisor to provide training or services under this Agreement; and (ii)
Franchisors and its Affiliates corporate and regional representatives
visiting the Hotel on specific Hotel business. In addition to such Travel
Expenses, Franchisee must reimburse Franchisor, or such other Person designated
by Franchisor, for the salary and other compensation of any individuals
providing services to the Hotel, including training.

3.7 Marriott
Agreement Payments.

Franchisee
must pay any other amounts due to Franchisor or its Affiliates under any
Marriott Agreement or other agreement or debt instrument between Franchisee and
Franchisor or its Affiliates.

3.8 Making
of Payments and Performance of Services.

All
payments required by Sections 3.2 and 3.3 will be made for each Accounting
Period within fifteen (15) days after the end of each Accounting Period. All
other payments required by this Agreement will be made pursuant to the timing
set forth in the invoice forwarded to Franchisee, which will not be less than
ten (10) days after Franchisor issues such invoice. Payments due to Franchisor
or its Affiliates will be paid by wire transfer of immediately available funds
or such other method as Franchisor approves to the accounts designated by Franchisor.
Franchisor has the right to have any service or obligation of Franchisor under
this Agreement be performed by an Affiliate of Franchisor and Franchisee agrees
to accept performance by such Affiliate. Franchisor also has the right to
designate that payment be made to one of its Affiliates instead of Franchisor,
and Franchisee must make such payments as designated.

3.9 Interest
on Late Payments.

If
any payment by Franchisee to Franchisor under this Agreement is not received on
or before its due date, such payment will be deemed overdue, and Franchisee
must pay to Franchisor, in addition to the overdue amount, interest on such
overdue amount which will accrue at a rate per annum equal to the Interest Rate
from the date such overdue amount was due until paid. Franchisors entitlement
to interest will be in addition to any other remedies Franchisor may have.

3.10 Taxes.

A.
Franchisee must promptly pay when due all Taxes levied or assessed by any Tax
authority relating to the Hotel, Franchisee, this Agreement, any other Marriott
Agreement or in connection with operating the Hotel.

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B.
Franchisee is responsible for payment of all Taxes, if any, levied on or
deducted from any amounts payable to Franchisor or its Affiliates under this
Agreement or any of the other Marriott Agreements. The amount of such Taxes
must be paid by Franchisee to Franchisor or such Affiliate together with the
payment to which it relates or as otherwise required by Applicable Law so that
the amount actually received by Franchisor or such Affiliate in respect of
such payment (after payment of such Taxes) equals the full amount stated to be
payable in respect of such payment. To the extent any Applicable Law requires
or allows any such deduction, payment or withholding to be paid by Franchisee
directly to a governmental authority Franchisee must account for and pay such
amounts promptly and provide to Franchisor receipts or other proof of such
payment promptly upon receipt.

C.
If there is a bona fide Dispute by Franchisee as to liability for Taxes,
Franchisee may contest the validity of the amount of the Tax in accordance with
Applicable Law, provided that Franchisee will not permit a Tax sale or seizure
by levy of execution or similar writ or warrant, or attachment by creditor, to
occur against any part of the Hotel. If such Dispute involves payments of Taxes
that must be withheld, deducted, and paid by Franchisee related to payments to Franchisor
as described in Sections 3.10.A and 3.10.B, Franchisee must pay such Taxes and
submit to the withholding authority for reimbursement in connection with such
Dispute, and Franchisee will be responsible for any interest or penalties
assessed in connection with any delayed or non-payment.

4. TERM

4.1 Term.

The
term of this Agreement begins on the Effective Date and terminates on the
twentieth (20th) anniversary of the Opening Date (the Term).

4.2 Not
Renewable.

This
Agreement and the rights granted by this Agreement are not renewable and
Franchisee has no expectation of any right to extend the Term.

5. SIZE, FINANCING, CONSTRUCTION, AND
RENOVATION

5.1 Size.

A.
The Hotel will consist of the number of Guestrooms stated in Exhibit A or such
other number approved by Franchisor.

B.
Franchisee may expand the Hotel or construct additional Guestrooms at the
Hotel, but only with Franchisors prior approval and only in compliance with
Section 6. If Franchisor approves the proposed addition, Franchisee must pay
Franchisor, within fifteen (15) days after receiving notice of approval, a fee
equal to the per-room charge used in calculating the application fee for newly
developed System Hotels, as specified in the Franchise Disclosure Document,
multiplied by the number of such additional Guestrooms.

5.2 Financing
of the Hotel.

Franchisee
will not, and will cause each Interestholder in Franchisee to not, incur or
replace any indebtedness that is secured by a lien on or mortgage of the Hotel
or pledge of Ownership Interests in Franchisee (whether such indebtedness is
incurred (i) individually on behalf of the Hotel or (ii) on a pooled basis with
other hotels or legal entities (a Financed Pool)) unless the following

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conditions are met at the time the indebtedness is incurred or
replaced: (1) the terms of such indebtedness are commercially reasonable; (2)
the debt coverage ratio is equal to or greater than 1.3; and (3) the lender is
not a Competitor or an Affiliate of a Competitor. The condition set forth in
clause (2) of the immediately preceding sentence will not apply to indebtedness
incurred prior to the third anniversary of the Opening Date to finance the
construction of the Hotel (or the conversion of such construction financing to
permanent financing, if such permanent financing is obtained at the same
closing as the construction financing). The debt coverage ratio as of any
calculation date is the ratio of: (a) cash available for the payment of debt
service (interest and principal) for the Hotel (or hotels, including the Hotel,
that are part of the Financed Pool) from Gross Revenues (after deduction for
any management fee or reserve required under this Agreement, any management
agreement or under the terms of any financing) of the Hotel (or hotels,
including the Hotel, that are part of the Financed Pool) for the twelve (12)
months immediately preceding such calculation date, to (b) the greater of (x)
the actual contractual amount of debt service payments required to be made
during the twelve (12) month period after the calculation date for the Hotel
(or hotels, including the Hotel, that are part of the Financed Pool) or (y) the
amount of debt service payments that would be required to be made during the
twelve (12) month period after the calculation date for the Hotel (or hotels,
including the Hotel, that are part of the Financed Pool) assuming the
indebtedness bears interest at an interest rate of 7.5% and has a 20-year
mortgage-style principal amortization. Franchisee will give notice to
Franchisor of the component hotels and legal entities in a Financed Pool before
incurring such indebtedness.

5.3 Construction/Conversion/Renovation
of the Hotel.

Franchisee,
at its expense, must start and complete in a timely fashion and to Franchisors
satisfaction the construction, conversion or renovation, as the case may be, of
the Hotel in accordance with (i) Exhibit B and (ii) the Standards.

6. SOURCING AND DESIGN APPROVALS

6.1 Furniture,
Fixtures, Equipment, Supplies, and Signage.

A.
Franchisee will use only such signs, FF&E, Inventories and Fixed Asset
Supplies that conform to the Standards and are purchased from a supplier or
manufacturer designated as approved by Franchisor (or as approved in
accordance with Section 6.1.B). Franchisor may designate approved suppliers,
including Franchisor or any of its Affiliates, as the only approved supplier
for certain items. Before seeking approval from Franchisor to purchase FF&E
to be used in constructing or renovating the Hotel Guestrooms, Franchisee will
prepare models of the basic types of rooms (double/double, king and/or single),
furnish the same with the proposed FF&E, and provide Franchisor an
opportunity to inspect the model rooms to determine whether such proposed
FF&E satisfies the Standards. Before seeking approval from Franchisor to
purchase FF&E to be used in constructing or renovating the Public
Facilities, Franchisee will prepare detailed drawings of the layout of the
Public Facilities and color boards with samples and specifications for Public
Facilities FF&E, and provide Franchisor an opportunity to review and inspect
the same to determine whether such proposed FF&E satisfies the Standards.

B.
The requirements of this Section 6.1 are to insure that items used at System
Hotels will be uniform and of high quality to maintain the identity, integrity
and reputation of the System. If Franchisee proposes to purchase or lease any
signs, FF&E, Inventories, Fixed Asset Supplies or other items not
previously approved by Franchisor as meeting the Standards, or from a supplier
or manufacturer that Franchisor has not previously approved, Franchisee and
such supplier or manufacturer will submit to Franchisor, at no cost to
Franchisor, sufficient specifications and other information and samples for
Franchisor to determine whether such items meet the Standards. Franchisor may
require payment of an

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amount not to exceed the cost of such inspection, and Franchisor will
not be liable for damage to any sample. Franchisor may require such supplier or
manufacturer to demonstrate to Franchisors satisfaction that such supplier
and/or manufacturer: (i) can manufacture such products to specifications that
meet the Standards; (ii) can deliver them in a timely manner and in sufficient
quantities to meet the needs of the Hotel; and (iii) has insurance protecting
Franchisor and its Affiliates against any relevant claims. If the proposed
arrangement involves the supplying or manufacturing of products utilizing
Franchisors Intellectual Property, Franchisor may also require the supplier or
manufacturer to: (a) enter into a written agreement with Franchisor concerning
the use of Franchisors Intellectual Property on terms acceptable to
Franchisor; and (b) demonstrate to Franchisors satisfaction that it can comply
with the terms of such agreement. Franchisor may revoke its approval as to
future purchases if the supplier or manufacturer at any time after such
approval fails to meet the requirements of this Section 6.1 or the Standards.

6.2 Design
Approval.

A.
If Franchisee elects or is required by this Agreement (including, under
Section 11.1) to perform construction work or renovations or refurbishment
of the Hotel affecting the design, character, or appearance of the Hotel,
Franchisee will obtain the prior approval of Franchisor that any such construction
work or significant renovations or refurbishment complies with the Standards
and the requirements set forth in this Section 6. Before commencing such
construction, renovation or refurbishment, Franchisee will engage a qualified
registered architect, interior designer, and other qualified consultants and
cause them to: (i) adapt the Design Criteria to the Approved Location and to
Applicable Law, including the Americans
with Disabilities Act and/or other similar state laws, codes, and/or
regulations governing public accommodations for persons with disabilities,
(ii) prepare complete construction documents, including a site plan and
architectural, mechanical, electrical, civil engineering, landscaping and
interior design drawings and specifications, and material samples, in each
case, based on the Design Criteria (collectively, the Renovation Drawings),
and (iii) submit the Renovation Drawings to Franchisor to review for compliance
with the Design Criteria at least sixty (60) days prior to commencing such construction,
renovation or refurbishment. Franchisee will not deviate from the Design
Criteria in the Renovation Drawings; provided if, due to unique circumstances
disclosed to Franchisor prior to the date the Renovation Drawings are submitted
to Franchisor, it is necessary to deviate from the Design Criteria, all
deviations from the Design Criteria, including those that are necessary to
adapt the Design Criteria to the Approved Location, must be clearly designated
in a separate document and submitted to Franchisor along with the Renovation
Drawings. Based on the complexity of the design or the Renovation Drawings, or
the amount or type of services requested or needed Franchisor may charge
Franchisee an amount equal to One Hundred Thirty Dollars ($130) per hour for
the additional time spent reviewing the Renovation Drawings and inspecting the
Hotel, in addition to Travel Expenses of personnel that inspect the Hotel.

B.
If requested by Franchisor, Franchisee will provide to Franchisor the name,
address, and relevant work experience on similar projects for any architect,
engineer, design firm or general contractor that Franchisee wishes to retain,
and Franchisor will have thirty (30) days after receipt of such information to
notify Franchisee of its election to consent or withhold its consent.
Franchisors election to consent or withhold its consent will be based on prior
experiences of Franchisor and its Affiliates with such Person, such Persons
general business reputation, and such Persons relevant work experience on
similar projects. If Franchisor does not respond to Franchisee within thirty
(30) days after Franchisors receipt of such information, then Franchisee may
retain such Person. Neither Franchisors failure to respond within the required
time period nor Franchisors consent to Franchisees use of such Person will be
deemed an endorsement or recommendation by Franchisor of any such Person.
Franchisee acknowledges and agrees that Franchisor is not liable for the
unsatisfactory performance of any Person retained by Franchisee.

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C. Franchisor will promptly review the
Renovation Drawings for compliance with the Design Criteria. If Franchisor
determines that the Renovation Drawings do not comply with the Design Criteria,
Franchisor will provide recommended changes to Franchisee that Franchisee will
incorporate into the Renovation Drawings and resubmit to Franchisor for its
review. Each party will act speedily and in good faith in the preparation,
submission, review and revision of the Renovation Drawings. Franchisee will not
begin the construction, renovation or refurbishment until Franchisor notifies
Franchisee that the Renovation Drawings comply with the Design Criteria. As
soon as reasonably possible after Franchisor notifies Franchisee that the
Renovation Drawings comply with the Design Criteria Franchisee will submit to
Franchisor two (2) sets of the final Renovation Drawings.

D.
Once finalized, the Renovation Drawings will not be changed, including changes
required by governmental authorities, without the prior written consent of
Franchisor.

E.
Franchisee agrees that Franchisee, and not Franchisor or its Affiliates, is
responsible for: (i) ensuring that any design, construction documents,
specifications, and any construction, renovation, or refurbishment complies
with any Applicable Law, including any requirements relating to disabled
persons; (ii) any errors or omissions; or (iii) discrepancies (of any nature)
in any drawings or specifications. Franchisee further acknowledges and agrees
that: (a) Franchisors review of the Renovation Drawings is limited solely to
determining whether the Renovation Drawings comply with the Design Criteria;
and (b) Franchisor will have no liability or obligation with respect to
renovation, upgrading or furnishing of the Hotel. Except for Franchisees own
uses related to its construction or operation of the Hotel, Franchisee will not
reproduce, use or permit the use of any of the design concepts, drawings, or
Standards.

|   |                                                                         
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|7. | LOCAL ADVERTISING AND MARKETING, PRICING, AND MARKETING FUND
 ACTIVITIES

7.1 Franchisees
Local Advertising and Marketing Programs and Press Releases.

A.
Franchisee will undertake Local Advertising Programs that will be (i) at
Franchisees expense, (ii) conducted to the extent that Franchisee deems
necessary, and (iii) in accordance with the Standards.

B.
Franchisee will prominently use and display in, upon and in connection with the
Hotel: (i) signs and other Marketing Materials and the Proprietary Marks
only in the combination, arrangement, and manner approved or required by
Franchisor and in accordance with the Standards; and (ii) such other trade
names, trademarks, logos, and designs as may be provided, approved, or required
by Franchisor. All signs and Marketing Materials must comply with Applicable
Law. Franchisee must not display in or on the Hotel premises or elsewhere, any
sign or Marketing Materials of any kind that does not comply with the Standards
or that Franchisor has not approved or to which Franchisor objects. Franchisee
must submit samples of Marketing Materials not provided by Franchisor or its
Affiliates and obtain prior approval from Franchisor before any public use of
such Marketing Materials. If Franchisor, subsequent to its approval of
Marketing Materials or Local Advertising Programs, withdraws its approval,
Franchisee must immediately cease the use, distribution, and dissemination
thereof. Any Marketing Materials developed by Franchisee may be used by other
Franchisor Lodging Facilities without compensation to Franchisee.

7.2 Reservations,
Pricing, and Rates.

A.
Franchisee must provide its prices and rates for use in the Reservation System
as requested by Franchisor or in accordance with the Standards. Franchisee
must: (i) honor any prices,

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rates, or discounts that appear in the Reservation System, or any other
publication, system, program, or promotion (written or electronic);
(ii) honor all reservations made through the Reservation System or that
are otherwise confirmed; and (iii) not charge any Hotel guest a rate
higher than the rate specified at the time that the Hotel guests reservation
was made, according to the records of the Reservation System or, if not made
through the Reservation System, the record of the reservation. Franchisee will
also honor all other contracts or pricing and terms for meeting rooms or any
other activity or service at or in connection with the Hotel.

B.
Franchisee is responsible for setting its own prices and rates for Guestrooms
and other products and services at the Hotel and determining any prices or
rates that appear in the Reservation System or any other publication or system
(written or electronic) that lists any prices or rates for the Hotel.
Franchisor, however, may: (i) prohibit certain types of charges or billing
practices that Franchisor determines are misleading or otherwise detrimental to
the System, including price-gouging or incremental fees for services that
guests would normally expect to be included in the room charge; (ii) require
that Franchisee price consistently in various distribution channels; or (iii)
impose other pricing requirements permitted or required by Applicable Law.

C.
Franchisor may recommend or suggest prices or rates for the products and
services offered by Franchisee or require participation in various sales or
revenue management programs or promotions offered by Franchisor and its
Affiliates. Franchisors recommendations or suggestions concerning prices or
rates are not mandatory; Franchisee is ultimately responsible for determining
the prices or rates at which it offers its products and services, and
Franchisors recommendations or suggestions are not a representation or
warranty by Franchisor that the use of such suggested or recommended prices or
rates will produce, increase, or optimize Franchisees profits and Franchisor
will not be liable for any such recommendations or suggestions. This provision
expressly includes any prices or rates for any bookings made by or for
Franchisee in connection with any sales activity or program of Franchisor or
its Affiliates in which Franchisee participates.

D.
Franchisor may provide Inventory Management or sales services at the request
of, and as Sales Agent for, Franchisee. Franchisor does not represent or
warrant that Inventory Management or sales determinations made by Franchisor
will produce, increase, or optimize Franchisees profits, and Franchisor will
not be liable for any such determinations. This provision expressly includes
any prices, rates or bookings affected by any Inventory Management or sales
services provided by Franchisor or its Affiliates to Franchisee.

7.3 Marketing
Fund Activities.

A.
Franchisor and its Affiliates and any of their designees will direct the
Marketing Fund Activities, including the placement and allocation thereof. Upon
the request of Franchisee, Franchisor will provide to Franchisee an unaudited
accounting of the uses of Marketing Funds in any fiscal year of Franchisor if
such request is made no earlier than ninety (90) days and no later than one
hundred and eighty (180) days after the end of such fiscal year. Marketing Fund
Activities are intended to promote general public recognition and acceptance of
the Proprietary Marks and use of System Hotels, and Franchisor and its
Affiliates, and their designees, are not obligated to make expenditures for the
Hotel on a basis equivalent or proportionate to the Hotels Marketing Fund
Charges or to ensure that any particular System Hotel benefits directly or
proportionately from Marketing Fund Activities or expenditures. Marketing Fund
Activities may not necessarily include all of the System Hotels and some
Marketing Fund Activities may benefit or include other Franchisor Lodging
Facilities in addition to System Hotels.

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B.
Franchisor reserves the right to: (i) modify or reconstitute the local,
regional, national or international scope of the Marketing Fund Activities; and
(ii) terminate the Marketing Fund Activities and establish methods of
funding Marketing Fund Activities other than payment of the Marketing Fund
Charge.

C.
Franchisor and its Affiliates do not hold Marketing Funds as a trustee or as a
trust fund, and Franchisor and its Affiliates have no fiduciary duty to
Franchisee with regard to the administration, use, or expenditure of Marketing
Funds. Marketing Funds may be commingled with other money of Franchisor and its
Affiliates and used to pay: (i) all costs associated with developing,
preparing, producing, directing, administering, researching, conducting, and
disseminating Marketing Fund Activities, as well as the administrative costs
and overhead incurred by Franchisor, or any of its Affiliates, with respect to
the foregoing (including the cost of salaries and overhead for Franchisors and
its Affiliates personnel involved in Marketing Fund Activities); and (ii) the
cost of collecting and accounting for the Marketing Funds. Franchisor or its
Affiliates may (but will not be obligated to) (i) loan money to be used for
Marketing Fund Activities and Franchisor reserves the right to charge interest
at then-current market rates with respect to such loans, and (ii) use Marketing
Funds to repay any such loan plus interest.

D.
When and if Marketing Materials are produced using Marketing Funds, all System
Hotels will receive a portion of such materials in quantities determined by
Franchisor. If Franchisee requests any Marketing Materials in excess of such
portion allocated to Franchisee, Franchisor will require Franchisee to pay for
the costs of such additional Marketing Materials.

7.4 Special
Marketing Programs.

Franchisor
and its Affiliates may establish, coordinate, affiliate with, and require
Franchisees participation in Special Marketing Programs. Special Marketing
Programs may vary in duration, apply on a local, regional, national, or
Category basis, or involve clusters or groups of Franchisor Lodging Facilities
utilizing services on a shared basis. Examples of Special Marketing Programs
include cooperative advertising programs, sales and marketing programs, customer
satisfaction programs, travel agency programs, events and Frequent Traveler
Programs. Special Marketing Programs have a cost to Franchisee that is in
addition to the Marketing Fund Charge. If Franchisee participates in a Special
Marketing Program Franchisee will pay for such programs on the same basis as
paid by other participating System Hotels, as contemplated in Section 3.3.B.
Franchisee may elect to participate in such activities or Franchisor may
require participation.

|   |                                                                  
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|8. | PROPERTY SYSTEM, RESERVATION SYSTEM, AND OTHER ELECTRONIC SYSTEMS

8.1 Systems
Installation.

Franchisee
must, at its expense, purchase or lease, install, maintain, and use at the
Hotel all Electronic Systems in accordance with specifications provided by or
on behalf of Franchisor and may not use such Electronic Systems to process
administrative functions not specifically related to the System.

8.2
Reservation System.

Franchisor
will make the Reservation System available to the Hotel, provided if Franchisee
is in breach of this Agreement and if such breach is not cured within the time
period required for cure of such breach under this Agreement, Franchisor may,
in addition to any other remedies it may have, suspend the Hotel from using the
Reservation System for so long as such breach remains uncured.

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Franchisee waives all claims against Franchisor and its Affiliates
arising from Franchisees suspension from the Reservation System under this
Section 8.2, other than claims that Franchisee is not in breach of this
Agreement. Franchisee will cause the Hotel to participate in the Reservation
System, will use the Reservation System only for the benefit of the Hotel, and
will comply with all Standards related to participation.

8.3 Optional
System(s).

Franchisor
may provide to Franchisee the specifications for the Electronic Systems for
optional systems. If Franchisor makes available optional system(s) and
Franchisee elects to use such system(s), Franchisee must, at its expense,
purchase or lease, install, maintain, and use at the Hotel all Hardware and
Software necessary for the proper and efficient utilization and operation of
such system(s) in accordance with specification provided by or on behalf of
Franchisor and pay any fees associated therewith pursuant to Section 3.4.

8.4 System
Communication Costs.

As
part of the Property System, Reservations System, Yield Management System and
other systems, Franchisee will: (i) at its cost and expense, use the
communication system (such as telephone or Internet systems) as specified or
otherwise approved by Franchisor for System Hotels; and (ii) be responsible for
and pay: (a) charges for any communication system (such as telephone or
Internet lines) that connects Franchisees equipment to the Property System,
Reservation System, Yield Management System or other systems; (b) the cost of
supplies used in the operation of such equipment; and (c) all other related
expenses.

8.5 Electronic
Systems Provided Under License.

The
Electronic Systems will remain the sole property of Franchisor or any third
party vendors, as applicable. Franchisee will at all times treat the Electronic
Systems as confidential. As a condition to using the Electronic Systems,
Franchisee must execute the Electronic Systems License Agreement. Franchisee
acknowledges that the Electronic Systems will be modified, enhanced, replaced,
or become obsolete, and that new Electronic Systems will be created to meet the
needs of the System and System Hotels and the continual changes in technology
and that any such new Electronic Systems will be subject to the terms of the
Electronic Systems License Agreement. If from time to time Franchisor
determines that it is advisable or necessary to amend or replace the Electronic
Systems License Agreement as a result of the creation, modification,
enhancement, replacement or obsolescence of any Electronic Systems, Franchisee,
upon the request of Franchisor, will execute the then-current form of
Electronic Systems License Agreement or an amendment to the Electronic Systems
License Agreement.

9. OPERATIONS

9.1 Operating
the Hotel.

A.
Franchisee will operate the Hotel using the System, in compliance with the
Standards, and in such a manner as to provide courteous, uniform, respectable,
and high quality lodging and other services and conveniences to the public.
Franchisee will maintain a high moral and ethical standard and atmosphere at
the Hotel. Franchisee will:

(1)
permit the duly authorized representatives of Franchisor to: (i) enter
Franchisees facilities and inspect same at all reasonable times to confirm
that Franchisee is complying with the terms of this Agreement and the
Standards; and (ii) test any and all equipment, food products,

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and supplies located at the Hotel. Franchisee may be required to pay
any costs related to such inspections and provide free lodging to any such
inspector or inspectors on official duty for such time as may be reasonably
necessary;

(2)
not knowingly permit gambling to take place at the Hotel (except for a limited
number of reputable charitable events permitted by law) or use the Hotel for
any casino, lottery, or other type of gaming activities;

(3)
not sell, display or use in the Hotel any vending machines, honor bars (in
Guestrooms), entertainment devices, or similar products that have not been
previously approved by Franchisor;

(4)
fully participate in all customer surveys and guest satisfaction audits and
offer all guest services, which may include complimentary services, as
Franchisor may prescribe for System Hotels including programs and services for
senior citizens, children and frequent guests;

(5)
fully participate in travel agent programs, any complaint resolution and other
programs as Franchisor may reasonably establish for System Hotels, which
programs may include providing complimentary rooms or refunds to guests; and

(6)
except as otherwise set forth herein, make when due all payments in accordance
with the terms of all contracts, agreements, and invoices, except for payments
that are disputed by Franchisee in good faith.

B.
Franchisee will provide food and beverage service in the Hotel in conformity
with the Standards to insure the highest degree of quality and service.
Franchisee agrees:

(1)
to use any food and beverage service outlet solely for the operation of the
business franchised hereunder; keep any food and beverage service outlet open
and in normal operation for such minimum hours and days as Franchisor may
prescribe;

(2)
to maintain in sufficient supply, and use at all times, only such food and
beverage products and ingredients, supplies, paper goods, dinnerware and
furnishings as conform with the Standards, and to refrain from deviating
therefrom without Franchisors prior written consent; and

(3)
to sell or offer for sale only the menu items and beverages prescribed in the
Standards or otherwise approved in writing by Franchisor; to sell or offer for
sale all required menu and beverage items and prepare them in accordance with
the Standards; and to discontinue selling and offering for sale any items as
Franchisor may, in its discretion, disapprove in writing at any time.

9.2 System
Promotion and Diversion to Other Businesses.

A.
Franchisee must use all reasonable means to encourage and promote the use of
System Hotels everywhere. If Franchisee receives a request for reservations or
hotel services or accommodations or use of Public Facilities in any area where
a System Hotel or other suitable Franchisor Lodging Facility is located,
Franchisee must promptly refer such request to Franchisor or such Franchisor
Lodging Facility. Franchisee will not, without obtaining Franchisors prior
consent, associate or affiliate with any other hotel business organization that
requires Franchisee to refer business to other members of that organization.

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B.
Unless Franchisee obtains Franchisors prior approval, which approval may be
withheld in Franchisors sole discretion, Franchisee will ensure that no part
of the Hotel or the System is used for or to further or promote or divert
business to:

(1)
any lodging business (including any other hotel operated by Franchisee or its
Affiliates or in which Franchisee, its Affiliates or a principal of Franchisee
or its Affiliates owns or holds an Ownership Interest) not operated under a
trade name or trademark owned by Franchisor or any of its Affiliates, including
advertising or promotion of hotels, vacation or time-sharing facilities (or any
similar product sold on a fractional or other basis with use rights on a weekly
or other periodic basis), conference centers, or other lodging products; or

(2)
any other business or concession.

9.3 Employees.

A.
Franchisee must employ suitable individuals as a general manager and other
managers (e.g., reservations manager, sales manager, and other department
managers or persons with different titles but similar duties to the foregoing)
and qualified personnel sufficient to staff all positions at the Hotel as
required by the Standards or Franchisor. Franchisees general manager and other
managers will devote their full time to the management and operation of the
Hotel, and such Persons will not be employed in any other capacity by
Franchisee or its Affiliates without the consent of Franchisor. Franchisee must
use its best efforts to ensure that Franchisees employees at all times: (i)
conduct themselves in a competent and courteous manner in accordance with the
image and reputation of Franchisor and the System; (ii) wear uniforms
designated or approved by Franchisor; and (iii) maintain a neat and clean
appearance and render competent, sober and courteous service to all Persons.

B.
All hiring decisions at the Hotel will be made solely by Franchisee. Franchisor
does not exercise any direction or control over the employment policies or
employment decisions of Franchisee. All employees of Franchisee are solely
employees of Franchisee, not Franchisor, and Franchisee is not Franchisors
agent for any purpose with regard to Franchisees employees.

C.
Franchisee agrees that Franchisor has the right to communicate directly with the
general manager and the other managers at the Hotel regarding day-to-day
operations of the Hotel, and such communications will be deemed made to
Franchisee. Franchisee authorizes Franchisor to rely on the statements of such
managers as to matters relating to the operation of the Hotel.

9.4 Management
and Operation of the Hotel.

A.
The Hotel will at all times be operated only by the Person consented to by
Franchisor in accordance with this Section 9.4. Such Person (i) may be either
(a) Franchisee or (b) if Franchisor in its sole discretion in connection with
the grant of the license in this Agreement determines that Franchisee does not
meet the requirements of this Section 9.4, a management company other than
Franchisee that would perform the day-to-day operations of the Hotel
(Management Company) and (ii) is identified in Paragraph 3 of Exhibit A.
Franchisee will at all times be responsible for complying with the obligations
of this Agreement regarding the management and operation of the Hotel
notwithstanding the retention of a Management Company.

B.
Any Management Company retained by Franchisee must before taking over
operations of the Hotel: (i) be qualified and consented to by Franchisor; and
(ii) together with Franchisee, execute and deliver to Franchisor a Management
Company Acknowledgment. Franchisors consent to the Management Company will be
evidenced by its counter-execution of the Management Company

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Acknowledgment. Franchisor may withhold its consent to any proposed
Management Company that, in Franchisors sole discretion: (a) is not
financially capable or responsible; (b) is not sufficiently experienced or
qualified in managerial skills or operational capacity or capability; (c) is
otherwise unable to adhere fully to the obligations and requirements of this
Agreement; or (d) does not provide Franchisor with all information that
Franchisor reasonably requests or with access to other businesses that
Management Company operates. Franchisor will have the right, at its option, to
review any management agreement between Franchisee and its proposed Management
Company for the Hotel to confirm that such management agreement is consistent
with the terms of this Agreement and the Management Company Acknowledgment.
Franchisee agrees that Franchisor will be under no obligation to consent to any
proposed Management Company that is (or is an Affiliate of any Person that is)
a franchisor or owner of, is under the common control of, is affiliated with,
or manages lodging facilities exclusively for the franchisor or owner of, a
lodging facility trade name that is competitive with Franchisor Lodging
Facilities, irrespective of the number of lodging facilities operating under
such a trade name. If there is a change in Control of the Management Company or
if the Management Company becomes a Competitor (or an Affiliate of a
Competitor), or if there is a material adverse change to the financial status
or operational capacity of the Management Company, Franchisee will, or will
cause Management Company to, promptly notify Franchisor of any such event and
Franchisor may require Franchisee to terminate its agreement with such
Management Company and engage a replacement management company that will be
subject to Franchisors consent process under this Section 9.4.B. Franchisor
will have at least thirty (30) days following Franchisors receipt of notice
and any information Franchisor requests to review and consent to or reject any
such replacement management company.

C.
Franchisee agrees that Franchisor will have the right to communicate directly
with the Management Company and the managers at the Hotel on matters relating
to the operation of the Hotel, and Franchisee authorizes Franchisor to rely on
the communications of such managers or Management Company as being on behalf of
Franchisee.

D.
Notwithstanding anything to the contrary set forth in this Agreement, the
Management Company Acknowledgment and/or Franchisors Quality Assurance
Program, if, during the Term of this Agreement, the Hotel is placed in the
Yellow Zone for any two consecutive tracking periods or in the Red Zone for any
single tracking period under Franchisors Quality Assurance Program, then
Franchisor may require, in its sole discretion, Franchisee to replace the
Management Company with another management company that has been approved by
Franchisor to operate the Hotel. Such replacement shall occur within sixty (60)
days from the receipt by Franchisee (or first refusal of delivery) of a written
notice by Franchisor advising Franchisee that it must replace the Management
Company. If Franchisee fails to replace Management Company in accordance with
the terms of this Section 9.4.D., then Franchisee shall be in material default
under this Agreement. For purposes of this Section 9.4.D., the terms Yellow
Zone and Red Zone refer to the Yellow Zone and the Red Zone (or any
comparable replacement terms) as such terms are used in Franchisors Quality
Assurance Program.

10. TRAINING, COUNSELING, AND ADVISORY
SERVICES

10.1 Training.

A.
The Hotel must be managed by an individual or individuals who have timely and
successfully completed the training program(s) required by Franchisor. Franchisor
will have the right to require that the Hotels or Franchisees management
personnel attend or complete specific training program(s), including before the
opening or conversion of the Hotel or in connection with a Transfer of Control
of Franchisee or the Hotel. Such training courses will be conducted at such
time and place as Franchisor will designate. Franchisee will advise Franchisor
of all newly hired management personnel

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within thirty (30) days after they commence employment, and such
personnel will attend and successfully complete such training program(s) within
the time frame Franchisor specifies.

B.
Franchisee must conduct such training for Franchisees employees as is required
for them to properly operate, administer and manage the Hotel in accordance
with the Standards.

C.
Franchisor may offer, and Franchisee may elect to participate in, optional
training courses for personnel engaged in operating or managing System Hotels.

D.
Franchisor will have the right to charge tuition, fees or reimbursements
described in Section 3.5 for all educational, training and orientation programs
that Franchisor offers, which must be paid before receiving training materials
or attending; provided, however, the tuition charge for courses conducted by
Franchisor will not be greater than the tuition charged for employees attending
from System Hotels operated by Franchisor. For all programs and activities
under this Section 10, whether mandatory or optional, Franchisee will be
responsible for paying all Travel Expenses, and the salary and other
compensation for individuals attending such training. Franchisor reserves the
right to require Franchisee to pay and/or reimburse Travel Expenses of the
providers of such training programs and services. Franchisor reserves the right
to require that Hotel employees execute confidentiality agreements in form and
substance satisfactory to Franchisor.

10.2 Counseling
and Advisory Services.

Franchisor
will make its representatives available at Franchisors designated offices at
reasonable hours or to meet in person to consult with and advise (but not
provide legal counsel or advice to) Franchisee regarding the design, operation,
and management of the Hotel as a System Hotel. If Franchisors representative
travels to the Hotel to provide such services, Franchisee must pay the expenses
of such representative while at, going to, and coming from, the Hotel,
including Travel Expenses, and salary or other compensation, in accordance with
Section 3.6.

11. PHYSICAL FACILITIES, SUPPLIES, AND
GOODS

11.1 Repairs
and Maintenance.

A.
Franchisee will maintain the Hotel in good repair and first-class condition and
in conformity with Applicable Law and the Standards. Franchisee or its
Affiliates must fund the cost of all repairs and alterations at the Hotel.
Franchisee will not make any major repairs, alterations, renewals,
replacements, or additions to the Hotel or carry out any material alterations
to the Hotel (including the design, character, or appearance thereof) without
first obtaining the prior consent of Franchisor, unless such repairs,
alterations, renewals, replacements, or additions are required by any
Applicable Law or are otherwise required for the continued safe and orderly
operation of the Hotel.

B.
Franchisee must complete a significant renovation of Guestrooms, Guestroom
corridors and Public Facilities, including (i) replacement of Soft Goods at
least every five (5) to six (6) years after the date such Soft Goods were
installed and (ii) replacement of Case Goods at least every ten (10) to twelve
(12) years after the date such Case Goods were installed; provided, however
earlier or more frequent renovations or replacements may be necessary to
maintain the quality level of the Hotel in compliance with the Standards and to
comply with the Quality Assurance Program. In connection with replacements in
the immediately preceding sentence, the replacement of all Soft Goods or all
Case Goods, as the case may be, will be done at the same time rather than being
done in a piecemeal fashion or in phases. If Franchisee cannot demonstrate the
date of installation of Soft Goods or Case Goods,

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Franchisor will determine the date of installation for purposes of the
first sentence of this Section 11.1.B after consultation with Franchisee.

C.
In connection with any replacement of Soft Goods or Case Goods, Franchisor has
the right to require Franchisee to upgrade the rest of the Hotel to conform to
the building décor, trade dress, and FF&E required under then-current
Standards for System Hotels of similar age. Franchisee will submit its plans
for such upgrading and remodeling to Franchisor for its review and approval
prior to commencing same. Franchisor will promptly review the plans for the
limited purpose of determining whether the plans comply with the Standards and
the applicable renovation scope. Franchisee will not begin the upgrading and
remodeling until Franchisor notifies Franchisee that the plans comply with the
Standards and the applicable renovation scope.

11.2 Funding
and Reserve.

A.
Franchisee or its Affiliates must fund the cost of all repairs and alterations
at the Hotel. In order to provide funds to accomplish the renovations described
in 11.1.B. above, and other necessary replacements and renewals of FF&E,
Franchisee will establish the Reserve, at a bank selected by Franchisee and
acceptable to Franchisor. All interest earned on funds in the Reserve will be
deposited in and credited to the Reserve in addition to the other funds already
in the Reserve. The Reserve will not be used for repairs, alterations,
improvements, renewals or replacements to the Hotel buildings structure or to
its mechanical, electrical, heating, ventilating, air conditioning, plumbing or
vertical transportation systems, which structure and operating systems will be
maintained in good repair and condition from other funds.

B.
Commencing with the Opening Date and continuing throughout the Term,
Franchisee, within fifteen (15) days after the end of each month, will transfer
into the Reserve an amount equal to five percent (5%) of Gross Revenues for
such month.

C.
At the end of each year, any amounts remaining in the Reserve will be carried
forward to the next year, and will not be credited against or decrease the
amount otherwise required to be deposited in the Reserve in the next year.

D.
No later than fifteen (15) days before the beginning of each year, Franchisee
will prepare and submit to Franchisor for its review and approval (i) an
estimate of the expenditures necessary each year to maintain the Hotel and the
amounts necessary from the Reserve for the necessary replacements and renewals
of FF&E and the significant renovations described in Section 11.1 to be
made during the upcoming year; and (ii) plans covering the next succeeding five
(5) years that: (a) address renovations, replacements, and renewals of FF&E
required to comply with the Standards; and (b) identify the availability of
funding for same.

E.
Franchisee agrees that the contributions to the Reserve required by Section
11.2.B. may not be sufficient to keep the Reserve at the levels necessary to
make all replacements and renewals of FF&E necessary to maintain the Hotel
as a high quality facility and in accordance with the Standards. If the funds
in the Reserve are insufficient for such purpose, Franchisee will promptly
provide the necessary funds in addition to the monthly contributions set forth
in Section 11.2.B.

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12. SYSTEM AND STANDARDS; FRANCHISEE
ASSOCIATION

12.1 Compliance
with System and Standards.

A.
Franchisee agrees that conformity with all aspects of the System and the
Standards is essential in order to maintain the uniform quality and guest
service of System Hotels and to enhance public acceptance of and demand for
System Hotels. Therefore, Franchisee agrees that it will comply with the
Standards in all matters involving the Hotel, and operate the Hotel in
compliance with the System, this Agreement, and the other Marriott Agreements.

B.
Franchisor will make the Standards available to Franchisee either in paper copy
or in digital, electronic, or computerized form, or in some other form now
existing or hereafter developed. Franchisee must pay a fee to retrieve, review,
use, or access the Standards not in paper form. The Standards will at all times
remain the sole property of Franchisor and its Affiliates. Franchisee will at
all times ensure that Franchisees copy of the Standards is kept up-to-date,
and if there is any dispute as to the contents of the Standards, the then-current
Standards will control.

12.2 Modification
of the System and Standards.

A.
Franchisor and its Affiliates expressly reserve the right, in their Reasonable
Business Judgment, to modify the System and Standards or any part of either and
such modifications may include materially changing, adding or deleting elements
of the System; provided, however, that any modification of the Proprietary
Marks under Section 13.2.B(3) may be made in Franchisors sole discretion.
Franchisee agrees that modifications to the System may be made for all System
Hotels or for any Category thereof.

B.
Franchisee agrees that modifications to the System may require Franchisee to
contribute to the cost of such modifications on a fair and consistent basis
with other participating System Hotels or other hotels, as determined by
Franchisor. To the extent that such modification relates to an ongoing program
or system, such as the Reservation System, the Yield Management System, or Property
System, or to any new Electronic Systems or other program or system, ongoing
payments related to such modifications will be made in accordance with Section
3.

12.3 Franchisee
Association.

If
Franchisor should, during the Term, sanction the formation of an association to
consider topics relating to the operation of System Hotels and to make
recommendations to Franchisor regarding such topics and any and all other
appropriate matters (the Association), Franchisee, Franchisor and other
System Hotel franchisees and licensees will be eligible for membership and
Franchisee will pay to the Association all dues and assessments authorized by
the Association (which will be consistently applied to all franchisees in the
System). The Association will adopt such bylaws and elect officers as are
deemed appropriate. Recommendations of the Association will be transmitted to
Franchisor and regarded by Franchisor as expressing the consensus of members of
the Association.

13. PROPRIETARY MARKS AND INTELLECTUAL
PROPERTY

13.1 Franchisors
Representations and Responsibility Regarding the Proprietary Marks.

A.
Franchisor represents with respect to the Proprietary Marks that:

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(1)
Franchisor and its Affiliates have the right to grant Franchisee the right to
use the Proprietary Marks in accordance with this Agreement; and

(2)
Franchisor will take or will cause to be taken all steps reasonably necessary
to preserve and protect the ownership and validity of the Proprietary Marks;
provided Franchisor will not be required to maintain any registration for the
Proprietary Marks that Franchisor determines, in its sole discretion, cannot or
should not be maintained.

B.
Subject to Franchisees compliance with the terms of this Agreement, Franchisor
will indemnify and hold Franchisee harmless against claims that Franchisees
use of the Proprietary Marks infringes upon the rights of any third party
unrelated to Franchisee, if Franchisee gives immediate notice of any such claim
to Franchisor, permits Franchisor to have sole control over the defense and
settlement of the claim, and cooperates fully with Franchisor in defending or
settling the claim.

13.2 Franchisees
Use of System and Intellectual Property.

A.
With respect to Franchisees use of the System and Intellectual Property under
this Agreement:

(1)
Franchisee will use the System and Intellectual Property only for such uses
regarding the operation of the Hotel as are expressly authorized under this
Agreement or otherwise authorized by Franchisor and only in the form and manner
authorized by Franchisor, and any use thereof not so authorized will constitute
an infringement of Franchisors rights as well as a material default of this
Agreement;

(2)
Franchisee will use the Proprietary Marks only in substantially the same
places, combination, arrangement, and manner as provided in the Standards or
approved by Franchisor. Franchisee will use the symbol ®, TM, SM
or such symbols or words as Franchisor may designate to protect the Proprietary
Marks;

(3)
Franchisee must identify itself as a franchisee or licensee of Franchisor and
the owner and/or operator of the Hotel only as allowed or required by
Franchisor and only in a manner and form designated by Franchisor. Franchisee
will not use the Proprietary Marks in any manner that would or could imply that
Franchisee has an Ownership Interest in the Proprietary Marks, including, on
Franchisees corporate letterhead, business forms, contracts, or business
cards, except as set forth in the Standards;

(4)
Franchisee does not have any right to and will not Transfer, sublicense, or
allow any Person to use any of the Intellectual Property, except as expressly
permitted in this Agreement;

(5)
Franchisee will not use the Intellectual Property to incur any obligation or
indebtedness on behalf of Franchisor or any of its Affiliates;

(6)
Franchisee will not use any Proprietary Mark or marks or names that are
similar, in Franchisors sole opinion, as part of Franchisees corporate or
legal name or in connection with any business activity or venture (other than
the Hotel) or as a road name or address, or apply for trademark or service mark
registration of any Proprietary Mark, any variation thereof or any mark similar
to any Proprietary Mark, in the United States or any other jurisdiction,
whether alone or in combination with other trademarks, trade names, trade
dress, symbols, logos, slogans, designs, insignia, emblems, devices, or service
marks;

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(7)
Franchisee must: (i) comply with Franchisors instructions in filing and
maintaining any required business, trade, fictitious, assumed, or similar name
registrations; (ii) obtain Franchisors prior approval of any name to be so
registered; and (iii) indicate in the registration documents that Franchisee
has the right to use such name only subject to the terms of this Agreement.
Franchisee must also execute any documents and take such other action deemed
necessary by Franchisor or its counsel to protect the Proprietary Marks or
maintain their validity and enforceability; and

(8)
if litigation involving the Intellectual Property is instituted or threatened
against Franchisee or any notice of such infringement is received by
Franchisee, or if Franchisee becomes aware of any infringement, Franchisee will
promptly notify Franchisor in writing and will cooperate fully with Franchisor
in Franchisors defense or settlement of such litigation. Franchisee will not
make any demand or serve any notice, orally or in writing, or institute any
legal action, or negotiate, litigate, compromise or settle any controversy with
respect to any such litigation, without first obtaining Franchisors prior
consent, which consent may be withheld in Franchisors sole discretion.
Franchisor will have the right to bring such action and to join Franchisee as a
party to any action in which Franchisor is or may be a party as to which
Franchisee is or would be a necessary or proper party.

B.
Franchisee agrees that:

(1)
Franchisor and its Affiliates are, in the aggregate, the owners or licensees of
all right, title, and interest in and to the System (other than Electronic Systems
provided by or licensed by third parties) and the goodwill associated with and
symbolized by the Proprietary Marks;

(2)
the Proprietary Marks are valid and serve to identify the System and those who
hold rights to operate hotels under the System;

(3)
the Proprietary Marks and other aspects of the System are subject to replacement,
addition, deletion, and other modification by Franchisor (or the Affiliate that
owns the Proprietary Marks) in its sole discretion. If any such action is taken
by Franchisor (or the Affiliate that owns the Proprietary Marks), Franchisee
will promptly accept and use such replacement, addition, deletion, and other
modification, and, in the case of the Proprietary Marks, display such changed
Proprietary Marks as if they were part of the System as of the Effective Date
(and replace, add, remove or modify the Proprietary Mark(s) that have been so
changed), and Franchisee will bear the cost of conforming the Hotel to any such
replacement, modification, addition, deletion, or other change;

(4)
During the Term and thereafter, Franchisee will not directly or indirectly (i)
attack the ownership, title or rights of Franchisor or its Affiliates in and to
any part of the System; (ii) contest the validity of any part of the System or
the right of Franchisor to grant to Franchisee the use of any part of the
System(other than Electronic Systems provided by or licensed by third parties)
in accordance with this Agreement; (iii) take any action or refrain from taking
any action that could impair, jeopardize, violate, or infringe any part of the
System; (iv) claim adversely to Franchisor or its Affiliates any right, title,
or interest in and to the System; or (v) misuse or harm or bring into dispute
the System;

(5)
Franchisee has no Ownership Interest in the System. Franchisees use of the
Intellectual Property and other aspects of the System under this Agreement
(including any modifications, derivatives or additions thereto proposed by or
on behalf of Franchisee or its Affiliates) will not give Franchisee any
Ownership Interest or other interest in or to the Intellectual Property or any
other aspect of the System, except the nonexclusive license granted by this
Agreement. Franchisee hereby assigns (and will cause each of its employees or
independent contractors who contributed to such modifications, derivatives or
additions to assign) to Franchisor, in perpetuity throughout the world, all
rights, title and interest (including the entire copyright and all renewals,
reversions and extensions

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thereof) in and to all modifications, derivatives and additions to the
Intellectual Property and other aspects of the System proposed by or on behalf
of Franchisee or its Affiliates. Franchisee waives (and will cause each of its
employees or independent contractors who contributed to such modifications,
derivatives or additions to waive) all moral rights of authors or any similar
rights that Franchisee (or its employees or independent contractors) may now or
hereafter have in the modifications, derivatives and additions to the
Intellectual Property and other aspects of the System proposed by or on behalf
of Franchisee or its Affiliates. Franchisee agrees to execute (or cause to be
executed) and deliver to Franchisor any documents and to do any acts that may
be deemed necessary by Franchisor to perfect or protect the title in the
modifications, derivatives or additions herein conveyed, or intended to be
conveyed now or in the future;

(6)
all goodwill arising from Franchisees use of the System (other than Electronic
Systems provided by or licensed by third parties) and any other aspect of the
System will inure solely and exclusively to Franchisors benefit, and upon
expiration or termination of this Agreement, no monetary amount will be
assigned as attributable to any goodwill associated with Franchisees use of
any aspect of the System; and

(7)
the rights in, and license of, the System granted hereunder to Franchisee are
nonexclusive, and thus Franchisor and its Affiliates may:

(a)
use and may grant franchises and/or licenses to others to use the System, and
otherwise profit from the System; and

(b)
establish, develop, franchise, and license other systems that use the
Intellectual Property and other aspects of the System, without offering or
providing Franchisee any rights in, to, or under such other systems.

C.
The provisions of this Section 13.2 will survive the expiration or termination
of this Agreement.

13.3 Franchisees
Use of Other Marks.

A.
Franchisee will not use in any manner any of the System in connection with any
Other Mark(s), without Franchisors prior approval.

B.
Franchisee will not use any name or Other Mark in connection with the Hotel
that may infringe upon or tend to be confused with a third partys trade name,
trademark, or other rights in intellectual property.

C.
Franchisee will not use or permit the use of any Other Mark in or at the Hotel
or in any Marketing Materials, advertising of, for, relating to or involving
the Hotel or its operation without Franchisors prior approval, which approval
may be granted or withheld in Franchisors sole discretion.

13.4 Internet
Website.

A.
With the exception of a website that describes Franchisees franchise
relationship with Franchisor and as stated in this Section 13.4 or the
Standards, Franchisee will not display the Proprietary Marks on or associate
the System with (through a link or otherwise) any website, electronic Marketing
Materials, domain name, address, designation, or listing on the Internet or
other communication system without the express consent of Franchisor. If
Franchisor permits Franchisee to display or use the Proprietary Marks on
Franchisees Internet site, the form, content and appearance of

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Franchisees Internet site, and any modifications thereto, must comply
with the Standards and be approved by Franchisor before it is posted on the
Internet so that Franchisor can maintain the common identity of the System
Hotels and the Proprietary Marks.

B.
Franchisee acknowledges that the www.marriott.comdomain name is the sole
property of Franchisor and its Affiliates. Franchisee will not, directly or
indirectly, use, register, obtain or maintain a registration for any Internet
domain name, address, or other designation that contains any Proprietary Mark
or any mark that is in Franchisors sole opinion confusingly similar, including
misspellings and acronyms. Upon Franchisors request, Franchisee must promptly
take all steps to cancel or transfer to Franchisor or its designee any such
domain name, address, or other designation under its control.

14. CONFIDENTIAL INFORMATION; DATA
PROTECTION LAWS

14.1 Confidential
Information.

Franchisee
will not, during the Term or thereafter, without Franchisors prior consent,
which consent may be granted or withheld in Franchisors sole discretion, copy,
duplicate, record, reproduce, in whole or in part, or otherwise transmit or
make available to any unauthorized Person any Confidential Information.
Franchisee may divulge such Confidential Information only to such of
Franchisees employees or agents as require access to it in order to operate
the Hotel, and only if such employees or agents are apprised of the
confidential nature of such information before it is divulged to them and they
are bound by confidentiality obligations substantially similar to those listed
above. All other Persons are unauthorized for purposes of this Agreement.
Franchisee agrees that the Confidential Information has commercial value and
that Franchisor and its Affiliates have taken reasonable measures to maintain
its confidentiality, and, as such, the Confidential Information is proprietary
and a trade secret of Franchisor and its Affiliates. Franchisee will be liable
to Franchisor for any breaches of the confidentiality obligations in this
Section 14.1 by its employees and agents. Franchisee will maintain the
Confidential Information in a safe and secure location and will immediately
report to Franchisor the theft or loss of all or any part of the Confidential
Information.

14.2 Data
Protection Laws.

Franchisee
will: (i) comply with all applicable Data Protection Laws; (ii) comply with all
of Franchisors requirements regarding the Data Protection Laws contained in
the Standards or otherwise; (iii) refrain from any action or inaction that
could cause Franchisor or its Affiliates to breach any of the Data Protection Laws;
(iv) do and execute, or arrange to be done and executed, each act, document and
thing necessary or desirable to keep Franchisor and its Affiliates in
compliance with any of the Data Protection Laws; (v) reimburse Franchisor and
its Affiliates for any and all costs incurred in connection with the breach by
Franchisee of such Data Protection Laws or Standards; and (vi) permit
Franchisor and its Affiliates to use any data or other information each of them
gathers concerning Franchisee and its Affiliates in connection with the
establishment and operation of System Hotels by Franchisor and its Affiliates.

15. ACCOUNTING AND REPORTS

15.1 Books,
Records, and Accounts.

Franchisee
at its expense must maintain and preserve for the Hotel for at least five (5)
years from the dates of their preparation, complete and accurate books,
records, and accounts in accordance with the Uniform System and United States
generally accepted accounting principles,

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consistently applied, Applicable Law and the Standards. Franchisees
obligation to preserve such books, records and accounts will survive the
expiration or termination of this Agreement.

15.2 Reports.

A.
Upon the request of Franchisor, Franchisee must, at its expense, submit to
Franchisor within fifteen (15) days after the close of each Accounting Period,
an operating statement containing such information required by Franchisor,
including the Gross Revenues and Gross Room Sales for such Accounting Period. In
addition, within sixty (60) days after the close of each calendar or fiscal
year, whichever is used by Franchisee for income tax purposes, Franchisee must
furnish Franchisor a full and complete statement of income and expense from the
operation of the Hotel for such preceding year, which will be prepared in
accordance with the Uniform System and
United States generally accepted accounting principles, consistently applied,
Applicable Law and the Standards. The statement must be prepared in accordance
with the Uniform System Income Statement with standard line items for those
specified by Franchisor. Such statement also will include a reasonably detailed
accounting (with such supporting documentation as Franchisor may reasonably
request) of the contributions to, and expenditures from, the Reserve during
such year, and such other information that Franchisor requires.

B.
Franchisee must, at its expense, submit to Franchisor such other miscellaneous
forms, periodic and other reports, records, financial statements, and other
information relating to Franchisee, the Hotel and the Hotels marketing, sales
and guests as Franchisor may reasonably request, in the form and at the times
and places specified by Franchisor. Franchisor has the right to access
Franchisees Property System and Reservation System directly to obtain
marketing, sales and guest information, and Franchisee will take all actions
reasonably necessary to provide such access.

15.3 Franchisor
Examination and Audit of Hotel Records.

A.
Franchisor and its authorized representatives have the right, at any time, but
upon reasonable notice to Franchisee, to: (i) examine and copy, at Franchisees
expense, all books, records, accounts, and tax returns of Franchisee related to
the operation of the Hotel during the five years preceding such examination;
and (ii) have an independent audit made of any of such books, records,
accounts, and tax returns. Franchisee must provide lodging without charge to
Franchisors representatives or independent auditors while conducting and
completing such audits, and Franchisee must provide such other assistance as
may be reasonably requested related to the audit. If an examination or audit
reveals that Franchisee has made underpayments to Franchisor or any of its
Affiliates, Franchisee must immediately pay to Franchisor or such Affiliate
upon demand, the amount underpaid plus interest on the underpaid amount which
will accrue thereon at a rate per annum equal to the Interest Rate from the
date such amount was due until paid.

B.
If an examination or audit discloses an understatement of payments due to
Franchisor of five percent (5%) or more for the period being examined or
audited, or if the examination or audit reveals that the accounting procedures
are insufficient to determine the accuracy of the calculation of any payments
due, Franchisee must reimburse Franchisor for all costs and expenses connected
with the examination or audit (including reasonable accounting and attorneys
fees). If the examination or audit establishes a pattern of underreporting,
Franchisor has the right to require that the annual financial reports due under
Section 15.2.A be audited by an independent accounting firm consented to by Franchisor.
The foregoing remedies are in addition to any other remedies that Franchisor
may have under this Agreement, including the right to terminate this Agreement
in accordance with Section 19.

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C.
If an examination or audit reveals that Franchisee has made overpayments to
Franchisor or any of its Affiliates, the amount of any such overpayment,
without interest, will be promptly credited against future payments due and
payable by Franchisee to Franchisor or such Affiliate.

16. INDEMNIFICATION AND INSURANCE

16.1 Indemnification.

Franchisee
will, and hereby does, indemnify, defend, and hold harmless Franchisor and its
Affiliates, their officers, directors, agents and employees, and their
respective successors and assigns, from and against all losses, costs,
liabilities, damages, claims, and expenses of every kind and description,
including allegations of negligence by Franchisor and its Affiliates and their
officers, employees, and agents, to the fullest extent permitted by Applicable
Law, and including reasonable attorneys fees, arising out of or resulting
from: (i) the unauthorized use of the Proprietary Marks; (ii) the violation of
Applicable Law; or (iii) the construction, renovation, upgrading, alteration,
remodeling, repair, operation, ownership or use of the Hotel or the Approved
Location or of any other business conducted on, related to, or in connection
with the Hotel or the Approved Location. Franchisee must promptly give notice
to Franchisor of any action, suit, proceeding, claim, demand, inquiry, or
investigation related to the foregoing. Franchisor will in any event have the
right, through counsel of its choice, at Franchisees expense, to control the
defense or response to any such action to the extent such action affects the
interests of Franchisor, and such undertaking by Franchisor will not, in any
manner or form, diminish Franchisees obligations to Franchisor hereunder.
Under no circumstances will Franchisor or a Person indemnified hereunder be
required or obligated to seek recovery from third parties or otherwise mitigate
its losses in order to maintain a claim for indemnification against Franchisee
under this Agreement, and the failure to pursue such recovery or mitigate a
loss will in no way reduce the amounts recoverable from Franchisee by a Person
indemnified hereunder. Franchisees obligations under this Section 16.1 will
survive the termination or expiration of this Agreement.

16.2 Insurance.

A.
During the Term, Franchisee, at its expense, will procure and maintain such
insurance as may be required by the terms of any lease or mortgage on the
Approved Location, and in any event no less than the following:

(1)
Property Insurance

(a)
Property insurance (or builders risk insurance during any period of
construction) including boiler and machinery coverage on the Hotel building(s)
and contents against loss or damage by fire, lightning, windstorm, and all
other risks covered by the usual all-risk policy form, all in an amount not
less than ninety percent (90%) of the full replacement cost thereof and a
waiver of co-insurance and agreed amount endorsement. Said policy will also
include coverage for landscape improvements and law and ordinance coverage in
reasonable amounts.

(b)
Business interruption insurance covering at least twelve (12) months loss of
profits and necessary continuing expenses (including Franchisee Fees) for
interruptions caused by any occurrence covered by the insurance referred to in
Sections 16.2.A(1)(a), (c) and (d). Such business interruption insurance will
name Franchisor as a loss payee as its interest may appear.

(c) If the Hotel is located in whole or in part within an area identified by the
federal government as having a special flood hazard, flood insurance in an
amount not less than the maximum coverage available under the National Flood
Insurance Program and excess flood

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coverage with reasonable limits, but in no event less than ten percent
(10%) of the full replacement cost of the Hotel building and contents,
including business interruption coverage in an amount not less than that set
forth in Section 16.2.A(1)(b).

(d)
If the Hotel is located in an earthquake prone zone or windstorm prone zone
as determined by the U.S. Geological Survey or the insurance industry,
earthquake insurance and windstorm insurance in an amount not less than the
probable maximum loss less any applicable deductibles, including business
interruption coverage in an amount not less than that set forth in Section
16.2.A(1)(b), all as determined by a recognized earthquake or windstorm
engineering firm, as applicable.

(2)
Workers compensation insurance in statutory amounts on all employees of the
Hotel and employers liability insurance in amounts not less than $1,000,000
per accident/disease.

(3)
Comprehensive or commercial general liability insurance for any losses arising
or pertaining to the Hotel or its operation, with combined single limits of
$1,000,000 per each occurrence for bodily injury and property damage. If the
general liability coverages contain a general aggregate limit, such limit will
be not less than $2,000,000, and it will apply in total to this Hotel only.
Such insurance will be on an occurrence policy form and will include premises and
operations, independent contractors, blanket contractual, products and
completed operations, advertising injury, employees as additional insureds,
broad form property damage, personal injury, incidental medical malpractice,
severability of interests, innkeepers and safe deposit box liability, and
explosion, collapse and underground coverage during any construction,
renovation, upgrading and/or remodeling.

(4)
Liquor Liability (applicable when Franchisee distributes, sells, serves, or
furnishes alcoholic beverages) for combined single limits of bodily injury and
property damage of not less than $1,000,000 each occurrence.

(5)
Business Auto Liability including owned, non-owned and hired vehicles for
combined single limits of bodily injury and property damage of not less than
$1,000,000 each occurrence.

(6)
Umbrella Excess Liability on a following form in excess of the liability
insurance required under subsections A(2) through (5) immediately above in not
less than the amount set forth opposite the number of stories in height that
the Hotel is above ground:

|                                 |  |                                    
|-------------------------------- |  | -----------------------------------
|Number of Stories 
 Above Ground |  | Umbrellas Excess 
 Liability Amount
|                                 |  |                                    
|                                 |  |                                    
|3 or less                        |  | $9,000,000                         
|4 or 5                           |  | $14,000,000                        

Such
coverage will apply in total to the Hotel only by specific endorsement.
Franchisor will have the right to require Franchisee to increase the amount of
coverage if the number of stories of the Hotel above ground is greater than
five (5) or if, in Franchisors Reasonable Business Judgment, such an increase
is warranted.

(7)
Fidelity insurance coverage or a fidelity bond in an amount not less than
$250,000 per occurrence.

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(8)
Such other insurance as may be customarily carried by other hotel operators on
hotels similar to the Hotel.

B.
The following general insurance requirements will be satisfied by Franchisee:

(1)
All insurance under subsection A(1)(b), and A(3) through (8) of this Section
will by endorsement specifically name as unrestricted additional insureds
Franchisor, any Affiliate of Franchisor designated by Franchisor, and their
employees and agents. All insurance required hereunder will be specifically
endorsed to provide that the coverages will be primary and that any insurance
carried by any additional insured will be excess and non-contributory.

(2)
Any deductibles or self-insured retentions maintained by Franchisee (excluding
deductibles for high hazard risks in high hazard geological zones, such as
earthquake and windstorm, which will be as required by the insurance carrier)
will not exceed $25,000, or such higher amount as may be approved in advance in
writing by Franchisor.

(3)
All insurance purchased in compliance herewith will be placed with insurance
companies reasonably acceptable to Franchisor and licensed to do business in
the state where the Hotel is located. Such licensing requirement will not apply
to those insurers providing umbrella excess liability above $5,000,000 under
subsection A(6) of this Section.

(4)
All insurance required hereunder will contain an endorsement whereby the
policies will not be canceled, non-renewed, or materially changed without at
least thirty (30) days prior notice to Franchisor. Franchisee will deliver to
Franchisor a certificate of insurance (or certified copy of such insurance
policy if requested by Franchisor) evidencing the coverages required herein.
Renewal certificates of insurance (or certified copies of such insurance policy
if requested by Franchisor) will be delivered to Franchisor not less than ten
(10) days prior to their respective inception dates.

(5)
All insurance required hereunder may be effected under policies of blanket
insurance that cover other properties of Franchisee and its Affiliates so long
as such blanket insurance fulfills the requirements herein.

(6)
Franchisees obligation to maintain the insurance hereunder will not relieve
Franchisee of its obligations under Section 16.1.

(7)
Should Franchisee for any reason fail to procure or maintain the insurance
required by this Agreement or as revised for substantially all franchisees or
licensees in the United States by the Standards or otherwise in writing,
Franchisor will have the right and authority (without however any obligation to
do so) to immediately procure such insurance and to charge the cost thereof to
Franchisee, which charges, together with a reasonable fee for Franchisors
expenses in so acting, will be payable by Franchisee immediately upon notice.

17. TRANSFERABILITY OF INTERESTS

17.1 Transfers
of Interests in the Hotel and Franchisee.

Franchisee
agrees that its rights and duties in this Agreement are personal to Franchisee,
and that Franchisor entered into this Agreement in reliance on the business
skill, financial capacity, and character of Franchisee and its principals and
Affiliates. A Transfer of any Ownership Interest in Franchisee, the Hotel or
any Ownership Interest in the Hotel, any of Franchisees rights or obligations
under this Agreement, or a Transfer of, or change of Control in, Franchisee or
a Control Affiliate is

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prohibited without the prior written consent of Franchisor except as
otherwise set forth in Sections 17 or 18. Upon Franchisors request, Franchisee
will furnish Franchisor with a list of the names and addresses of the
Interestholders in Franchisee and any Control Affiliate (other than holders of
Ownership Interests that are publicly-traded and were purchased on the open market).

17.2 Transfers
of Controlling Ownership Interests.

A.
Except as set forth elsewhere in Sections 17 and 18, if Franchisee or any
Interestholder of Franchisee or a Control Affiliate wishes to Transfer the
Hotel, its Ownership Interest in the Hotel, a direct or indirect Controlling
Ownership Interest in Franchisee, or effect a transaction that otherwise
results in a direct or indirect change of Control in Franchisee, Franchisee
will provide notice of such proposed Transfer to Franchisor. The notice will
state the full name and identity of all of the parties to the proposed
Transfer, including Interestholders of such parties and the terms of the
Transfer, together with all other related information that is reasonably requested
by Franchisor. Prior Transfers of Ownership Interests by or to the same Person
or an Affiliate of such Person will be considered in determining whether a
Transfer of a Controlling Ownership Interest or change of Control has occurred.
Within thirty (30) days after Franchisor receives such notice and required
information, Franchisor will notify Franchisee of Franchisors election of one
of the following two alternatives:

(1)
Franchisors election to consent to such Transfer, together with the conditions
to the Transfer, which include the following as conditions:

(a)
Franchisee must deliver to Franchisor all documents, information and
representations and warranties with respect to transferees corporate
organization, authority, and ownership requested by Franchisor, including a
complete copy of the sale and purchase agreement or similar document effecting
the Transfer;

(b)
Franchisee must satisfy all of its accrued monetary obligations to Franchisor
and its Affiliates, including an amount equal to a reasonable estimate of the
costs and fees not yet accumulated and/or invoiced, and will execute, in a form
prescribed by Franchisor, a general release of any and all claims against
Franchisor and its Affiliates, and their respective officers, directors, agents
and employees;

(c)
the proposed transferee must complete and submit to Franchisor a new franchise
application together with the then-current application fee being charged to
System Hotel franchisees (Transfer Fee). If Franchisor does not consent to
the Transfer application, Franchisor will refund the Transfer Fee, less Ten
Thousand Dollars ($10,000), which Franchisor will retain;

(d)
the transferee must enter into Franchisors then-current form franchise
agreement and relevant ancillary agreements, which will contain the standard
terms (except for duration, as provided below) then being issued for new
franchised hotels under the System, including the then-current fees and
charges. The new franchise agreement will be for a term that expires on or
after the last day of the Term and provide for the upgrade of the Hotel to
address any needed renovations and to bring the Hotel into compliance with
Franchisors then-current Standards (including Franchisors Fire Protection and
Life Safety Standards) pursuant to a property improvement plan (PIP).
Franchisee will pay Franchisors then-current, non-refundable property
improvement plan fee (currently, Ten Thousand Dollars ($10,000)) to cover
Franchisors costs associated with creating the PIP;

(e)
the transferee must retain a Management Company consented to by Franchisor to
control the day-to-day operations of the Hotel if Franchisor determines that
transferee is not qualified to operate the Hotel;

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(f)
the transferee must certify in writing that: (i) Franchisor did not endorse,
recommend, or otherwise concur with the terms of the Transfer, (ii) Franchisor
did not comment upon any financial projections submitted by Franchisee to
transferee, and (iii) Franchisor did not participate in the determination of
the consideration to be paid;

(g)
Franchisor will have the right to require that the transferee pay Franchisors
outside counsel costs in connection with any such Transfer;

(h)
if the transferee is a subsidiary of a real estate investment trust or a
publicly-held entity, or if the Hotel will be operated by a Management Company,
Franchisor may require the transferee to establish and maintain a reserve to
support the cost of future repairs and replacements of FF&E, and the
transferee will deposit into such reserve each month throughout the term of the
franchise agreement an amount equal to five percent (5%) of Gross Revenues or
such other amount as determined by Franchisor; and

(i)
if due to the unique ownership structure of the transferee or the Hotel,
Franchisors limited involvement franchising hotels with such structure (unique
or not), the debt service on the Hotel, or the financial status of the
transferee and its owners, Franchisor determines that additional protections
are necessary, Franchisor may, among other things, require the transferee to
establish and maintain a reserve (in addition to the reserve referenced in Section
17.2.A.1.(h) above) to support the cost of expenditures under the PIP and
capital improvements that are beyond the scope of the FF&E reserve
referenced in Section 17.2.A.1.(h) above, and the transferee will deposit into
such reserve the amount required by Franchisor at the time of the Transfer and
each month throughout the term of the franchise agreement.

(2)
Franchisors election not to consent to the Transfer, and Franchisee will be in
breach of this Agreement if Franchisee consummates such Transfer.

B.
Franchisor has the right, in its sole discretion, to elect not to consent to a
Transfer under Section 17.2.A(2) if: (i) Franchisor determines that such
transferee is not capable of successfully operating the Hotel under the
franchise agreement or the Standards (and requiring transferee to retain a
Management Company consented to by Franchisor is not an acceptable
alternative); (ii) Franchisor determines that the Management Company proposed
by transferee is not capable of successfully operating the Hotel under the
franchise agreement or the Standards or fails to meet Franchisors then-current
criteria for Management Companies; (iii) Franchisor determines that the
proposed transferees debt service or overall financial status will not permit
the Hotel to be operated pursuant to the Standards; (iv) an uncured breach or
default of a Marriott Agreement exists; (v) upon execution by transferee of a
new franchise agreement, the transferee would be in breach of such agreement;
(vi) the Hotel is not in good standing under the Quality Assurance Program; or
(vii) the Transfer is subject to Section 17.4 or violates Section 17.8.

C.
Subject to Section 17.4 and 17.8 and compliance with the conditions set forth
in Section 17.2.A(1)(a), (b), (e), (f), (g), (h) and (i), Franchisor will
consent to a Transfer of the Hotel or Franchisees Ownership Interests in the
Hotel or the Ownership Interests in Franchisee or a Control Affiliate to a
Person (a) in which Franchisee has a Controlling Ownership Interest and in
which Franchisee owns, directly or indirectly, at least 50% of the economic
interests or (b) in which the Interestholder that Controls Franchisee has a
Controlling Ownership Interest and in which the Interestholder that Controls
Franchisee owns, directly or indirectly, at least 50% of the economic
interests, in either case provided that: (i) Franchisor is provided at least 30
days advance written notice of such Transfer; (ii) Franchisee provides to Franchisor
documentation acceptable to Franchisor evidencing the Transfer by which such
Person expressly assumes the obligations of Franchisee hereunder and under

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each other Marriott Agreement; (iii) another party acceptable to
Franchisor has executed a guaranty substantially identical to the form of
guaranty set forth in the then-current Franchise Disclosure Document (which
party may be Franchisee or the transferee depending on the structure of the
transaction) and each and every Guarantor acknowledges the Transfer and
reaffirms and ratifies its obligations under the Guaranty; (iv) Franchisee is
not in breach or default under any of the Marriott Agreements; (v) the Hotel is
in good standing under the Quality Assurance Program; and (vi) each beneficial owner
of an Ownership Interest in such Person shall have passed Franchisors
then-current owner screen and paid any applicable fees in connection therewith.

17.3 Transfers
of Passive Investor Interests, Estate Planning, and Death or Mental Incompetency.

A.
Subject to Sections 17.4 and 17.8, Transfers of direct or indirect,
non-Controlling Ownership Interests (Passive Investor Interests) will be
consented to by Franchisor if the following conditions are met: (a) the Passive
Investor Interests are not owned by a Guarantor; (b) such Transfer(s),
individually and in the aggregate, will not effect (i) a Transfer of or change
in direct or indirect Control of Franchisee or the Hotel (in which case, the
provisions of Section 17.2 will apply) or (ii) a Transfer of a majority of the
Passive Investor Interests; (c) Franchisee provides Franchisor notice of such
Transfer at least twenty (20) days prior to the consummation of such Transfer,
together with reasonably detailed information concerning the identity and
background of any such transferee and its Interestholders and the structure of
such Transfer, and a representation and warranty that such information is true,
correct and complete and that the requirements of this Section 17.3.A are met; and (d) Franchisee pays the
then-current fee for background checks for any such transferee and its
Interestholders and such background checks reveal that (x) each such Person has
not been convicted of a felony, (y) each such Person is not otherwise known to
have violated the law, and (z) each such Persons character and reputation
otherwise complies with the Standards. If requested by Franchisor, Franchisee
will execute an amendment to this Agreement that updates the information on
Exhibit A regarding the ownership of Franchisee to reflect the ownership after
the Transfer. Franchisor will have the right to require that Franchisee pay
Franchisors outside counsel costs in connection with any such Transfer.

B.
Subject to Sections 17.4 and 17.8, for estate planning, Transfers of an
Ownership Interest in Franchisee to a member of an Interestholders immediate
family or to a trust for the benefit of such immediate family member or to any
Person in which the Interestholder has and, during the Term continues to have,
the Controlling Ownership Interest may be completed in accordance with the
requirements set forth in Section 17.3.A above, so long as such Transfers do
not in the aggregate result in a change of Control of Franchisee.

C.
Subject to Sections 17.4 and 17.8, if any Interestholder holding a Controlling
Ownership Interest in Franchisee dies or becomes mentally incompetent, the
interest of such person may be Transferred in accordance with and subject to
the terms of Section 17.2.A(1) provided that (i) any such Transfer will be made
within twelve (12) months of the date of death or mental incompetency, (ii) the
obligations of Franchisee under this Agreement are satisfied pending the
Transfer, and (iii) the Hotel will be continuously operated by Franchisee or a
Management Company as required under Section 9.4. If such death or mental
incompetency results in the temporary appointment of an executor, custodian or
other representative for a period not to exceed twelve (12) months, such
appointment will not be deemed a breach of this Section 17 if the conditions
above are satisfied, and (x) Franchisor is given notice of such appointment
within thirty (30) days of the date thereof; and (y) the appointee agrees to
cause the Hotel to be operated in compliance with this Agreement.

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17.4 Proposed
Transfer to Competitor and Right of First Refusal.

A.
If there is a proposed Transfer to a Competitor of (i) the Hotel (or any
interest therein), (ii) Franchisees Ownership Interest in this Agreement, or
(iii) an Ownership Interest or other interest in either Franchisee or a Control
Affiliate, Franchisee will give notice thereof to Franchisor, stating the full
name and identity of the prospective purchaser or tenant, as the case may be,
including the names and addresses of the Interestholders of such prospective
purchaser or tenant, the price or rental and all other terms of such proposed
transaction, together with all other related information that is reasonably
requested by Franchisor. Within thirty (30) days after receipt by Franchisor of
such notice and information from Franchisee, Franchisor will notify Franchisee
of Franchisors election, made in its sole discretion, of one (1) of the
immediately following four (4) alternatives:

(1)
Acquisition of Control of Hotel for Cash. If the proposed Transfer is a
sale or lease of the Hotel for cash consideration, Franchisor (or its designee)
will have the right to purchase or lease the Hotel at the same price or rental
and upon the same terms (other than any terms relating to the Brand of the
Hotel) as those contained in such offer from (or to) a Competitor. In such
event, Franchisee and Franchisor (or its designee) will promptly enter into an
agreement for sale or lease at the price or rental and on terms consistent with
such offer.

(2)
Acquisition of Franchisee/Acquisition of Control of Hotel. If the
proposed Transfer is a purchase or lease of all or a portion of the Ownership
Interests or the assets (which includes the Hotel) of Franchisee or a Control
Affiliate, or a merger with or into Franchisee or a Control Affiliate, or the
acquisition of Franchisees Ownership Interest in the Hotel, or any sale or
lease of the Hotel involving non-cash consideration, or other form of Transfer,
Franchisor (or its designee) will have the right to purchase or lease the Hotel
at the purchase or lease price under terms consistent with such offer as agreed
to by the parties. If the parties are unable to agree as to a purchase or lease
price and terms within fourteen (14) days of Franchisors election, the
purchase or lease price of the Hotel will be determined as provided below.

(a)
Within thirty (30) days after the fourteen (14) day period in this Section
17.4.A(2) expires, Franchisor and Franchisee will each obtain, at its own
expense, an appraisal of the fair market value of the Hotel from a nationally
recognized appraiser of Hotel properties comparable to the Hotel. In
determining the fair market value, the appraisers will assume that the Hotel is
not subject to a management agreement but is subject to this Agreement. If,
after receiving such appraisals, the parties agree on the fair market value of
the Hotel, such agreed fair market value will constitute the purchase or lease
price.

(b)
If within fourteen (14) days after receiving the appraisals the parties are not
able to agree on such fair market value, the purchase or lease price will be
determined by baseball arbitration in Washington, D.C. in accordance with the
Arbitration Rules for the Real Estate Industry of the American Arbitration
Association then in effect (AAA Rules) as modified by this Agreement. The
parties will jointly select a third party to act as the sole arbitrator (the
Arbitrator) to determine the fair market value of the Hotel, and such
Arbitrator will be a person having at least ten (10) years recent professional
experience as to the subject matter in question and will be qualified to act as
an Arbitrator in accordance with the AAA Rules. If the parties do not agree on
an Arbitrator with such qualifications within fifteen (15) days after the
expiration of such fourteen (14) day period referred to above, the Arbitrator
will be appointed by the American Arbitration Association in Washington, D.C.
in accordance with the AAA Rules.

(c)
The Arbitrator will be instructed and obligated to decide, within thirty (30)
days after appointment, whether the appraisal submitted by Franchisor or the
appraisal

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submitted by Franchisee most accurately reflects the fair market value
of the Hotel based upon the appraisals submitted and such information as is
normally relied upon by an appraiser of hotels and real estate. Each party
agrees to fully cooperate and provide all information requested by the
Arbitrator related to the Arbitrators determination of fair market value
hereunder. The Arbitrators choice of appraisal will be in writing, will
constitute the purchase price hereunder, and will be final, conclusive and
binding on the parties as an award under the AAA Rules, and may be enforced
by a court of competent jurisdiction. The expenses of the arbitration will be
borne equally by the parties to the arbitration. Franchisor (or its designee)
will have the right, at any time within thirty (30) days of being notified in
writing of the decision of the Arbitrator, to either (a) enter into an
agreement to purchase the Hotel premises and related property at the valuation
determined by the Arbitrator, or (b) give notice of its intent to terminate
this Agreement under Section 19.1.K within fourteen (14) days of such notice.
If Franchisor elects to give notice of its intent to terminate this Agreement
within fourteen (14) days of such notice, upon receipt of Franchisors election
to terminate, Franchisee must either: (i) cancel the Transfer to a Competitor
on or before the end of such fourteen (14) days or (ii) remove the Hotel from
the System, pay liquidated damages, and otherwise comply with Franchisees
post-termination obligations, in each case, as set forth in Sections 19.3 and
20 or, at Franchisors election, as may be set forth in a termination agreement
on terms acceptable to Franchisor.

(3)
Termination of Franchise Agreement. Franchisor may place this Agreement
in default and give notice of its intent to terminate this Agreement under
Section 19.1.K within fourteen (14) days of such notice. If Franchisor elects
to give notice of its intent to terminate this Agreement within fourteen (14)
days of such notice, upon receipt of Franchisors election to terminate,
Franchisee must either: (i) cancel the Transfer to a Competitor on or before
the end of such fourteen (14) days or (ii) remove the Hotel from the System,
pay liquidated damages, and otherwise comply with Franchisees post-termination
obligations, in each case, as set forth in Sections 19.3 and 20 or, at Franchisors
election, as may be stated in a termination agreement on terms acceptable to
Franchisor.

(4)
Consent. Franchisor may consent to such Transfer, which consent will be
on such terms as Franchisor may require, in its sole discretion.

B.
If a Competitor proposes to acquire all of the Ownership Interests of an
Affiliate of Franchisee and the Affiliate does not directly or indirectly own,
lease, or operate any hotels operating under a trade name owned by Franchisor
or any of its Affiliates, Franchisor will not have any right of first refusal
to purchase the Hotel or right to terminate this Agreement, as provided above
in Section 17.4.A with respect to such Transfer.

C.
If the Transfer to a Competitor is by foreclosure, judicial or legal process,
or any other means, Franchisor (or its designee) will have the right to
purchase the Hotel upon notice to Franchisee. If the parties are unable to
agree as to a purchase price and terms within thirty (30) days of Franchisors
notice, the fair market value of the Hotel premises and related property will
be determined by arbitration in accordance with Section 17.4.A(2). This
provision will survive the termination of this Agreement under Section 19.1 in
connection with the Competitors actions under this Section 17.4.C.

D.
If Franchisee or any of its Affiliates becomes a Competitor, Franchisee will
notify Franchisor in accordance with Section 17.4.A and provide all information
reasonably requested by Franchisor related to becoming a Competitor and
required thereby, or if Franchisor otherwise determines that Franchisee or any
of its Affiliates has become a Competitor, Franchisor will so notify Franchisee
and Franchisor will have the rights provided in Section 17.4.A(2) as if the
Hotel were subject to a non-cash offer from a third party except that
Franchisor will have thirty (30) days instead of fourteen (14) to agree on
purchase terms.

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17.5 Interest
in Real Estate and Injunctive Relief.

Franchisee
acknowledges that Franchisors rights under Section 17.4 are real estate rights
with respect to the Hotel. Franchisor is entitled to file a record of such
interest in and among the appropriate real estate records of the jurisdiction
in which the Hotel is located, and Franchisee will cooperate as requested by
Franchisor in such filing. Such filing will indicate that Franchisors rights
in real estate under Section 17.4 will be subordinate only to the exercise of
the rights of bona fide lenders under a mortgage or security deed secured by
the Hotel if and for so long as: (i) the lender is not a Competitor or
Affiliate of a Competitor; (ii) any such mortgage or security deed is and
remains validly recorded and in full force and effect; and (iii) the
indebtedness underlying such mortgage or security deed complies with the
requirements of Section 5.2. Franchisee agrees that damages are not an adequate
remedy if Franchisee breaches its obligations under such Section 17.4 and that
Franchisor will be entitled to injunctive relief to prevent or remedy such
breach without the necessity of proving the inadequacy of money damages as a
remedy and without the necessity of posting a bond. If this Agreement is terminated
and Franchisors rights under Sections 17.4, 17.5 and 17.6 are no longer in
effect, at the request of Franchisee or the transferee, Franchisor will deliver
upon request an instrument in recordable form to terminate any such recording
of interest in real estate.

17.6 Survival
of Right of First Refusal.

Except
for termination of this Agreement under Section 17.4.A(3), Franchisee agrees
that Franchisors rights under Section 17.4 will survive early termination of
this Agreement (as opposed to expiration of this Agreement as provided in
Section 4.1) and will bind Franchisee and its Affiliates, if the events in
either Section 17.6.A or Section 17.6.B occur:

A.
before or within six (6) months after termination of this Agreement, a proposed
Transfer to a Competitor occurs with respect to the Hotel, Franchisee or an
Affiliate, or an Ownership Interest in either Franchisee or such Affiliate; and

(1)
this Agreement is terminated under (x) Sections 19.1.K or L, (y) Section 19.2.B
or (z) Section 19.2.D based upon a violation of Section 13.2; or

(2)
this Agreement is terminated under Sections 19.1.A, B, C, D or E and an
Affiliate, principal, or director of Franchisee obtains possession of the
Hotel, or such Affiliate, principal, or director is the party filing the suit
or seeking the execution or foreclosure referenced in Section 19.1.

B.
there is a purported early termination of this Agreement (as opposed to
expiration of this Agreement as provided in Section 4.1) by Franchisee and
before or within six (6) months after such purported termination, a proposed
Transfer to a Competitor occurs with respect to the Hotel, the Franchisee or an
Affiliate of Franchisee, or an Ownership Interest in either Franchisee or such
Affiliate.

17.7 Security
Interests in the Hotel or Franchisee.

In
connection with any financing benefiting the Hotel, Franchisee will not mortgage,
grant a security interest in, or otherwise pledge as collateral, the Hotel, and
will not permit a mortgaging, granting of a security interest in, or otherwise
pledging as collateral of an Ownership Interest in Franchisee, or in a Person
Controlling Franchisee to banks or other bona fide reputable lending
institutions that are not Competitors, unless: (i) such financing meets the
requirements of Section 5.2 or Franchisor otherwise consents to such financing
in writing; (ii) this Agreement will not be pledged, mortgaged, assigned as
collateral for any financing, or the subject of a security interest; and (iii)
if such

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lender forecloses on, or otherwise exercises its rights against, the
Hotel or such Ownership Interests, Franchisor will have the rights under
Section 19.1.

17.8 Proposed
Transfers to Specially Designated National or Blocked Person.

No
Transfer of any direct or indirect Ownership Interest in Franchisee, the Hotel
or any Marriott Agreement will be made to a Specially Designated National or
Blocked Person or to a Person in which a Specially Designated National or
Blocked Person has an interest or provides funding. Any such Transfer will be a
material default under this Agreement.

17.9 Transfers
by Franchisor.

Franchisor
will have the right to Transfer this Agreement to any Person without prior
notice to, or consent of, Franchisee, provided such Person (a) assumes
Franchisors obligations to Franchisee under this Agreement, (b) is an
Affiliate of Franchisor or acquires substantially all of Franchisors rights in
respect of System Hotels in the relevant Category, and (c) is a Person
reasonably capable of performing Franchisors obligations under this Agreement.
Franchisee agrees that any such Transfer will constitute a release and novation
of Franchisor with respect to this Agreement. This Agreement will be binding on
and inure to the benefit of Franchisor and the successors and assigns of
Franchisor.

18. PUBLICLY-TRADED SECURITIES AND
SECURITIES OFFERINGS

18.1 Franchisees
Obligations.

A.
Publicly-traded securities in Franchisee or in any Control Affiliate may be
Transferred in compliance with Applicable Law without Franchisors consent if
the Transfer will not result in a Transfer of Control (as determined by
Franchisor) in Franchisee or a Control Affiliate. Any Transfer of Ownership
Interests in Franchisee or a Control Affiliate that will result in a Transfer
of Control of Franchisee or any Control Affiliate (as determined by Franchisor)
will be subject to Section 17.2.

B.
Without limiting Franchisors rights under Section 17.2, in connection with any
Transfer of Ownership Interests in Franchisee or a Control Affiliate involving
any proposed public or private offering of securities that uses in any way the
Proprietary Marks, identifies the Hotel, Franchisor or its Affiliates, or
discusses the relationship between Franchisor or its Affiliates and franchisee
or its Affiliates, Franchisee must also:

(1)
provide Franchisor with appropriate representation or information demonstrating
the lawfulness of the offering and obtain Franchisors consent to such use;

(2)
fully and unconditionally indemnify and hold harmless Franchisor and its
Affiliates in connection with the Prospectus and the offering;

(3)
use any Proprietary Marks in the Prospectus and in any supporting or related
materials only as approved by Franchisor in writing; and

(4)
submit to Franchisor for its review at least thirty (30) days before the
earliest of the date on which any Prospectus is delivered to a potential
investor or filed with the Securities and Exchange Commission or any other
governmental authority responsible for the regulation of the sale of
securities, a copy of the proposed Prospectus, all supporting and related
materials and releases.

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Franchisor, in its sole discretion, may require Franchisee to pay for
its costs and expenses in performing the limited review of the proposed
Prospectus in accordance with this Section 18, including attorneys fees and
expenses.

C.
If the indemnification provided for in Section 18.1.B(2) above will for any
reason be unavailable or insufficient to hold Franchisor and its Affiliates
harmless in respect of any claim, then Franchisee will, in lieu of indemnifying
Franchisor and its Affiliates, contribute to the amount paid or payable by Franchisor
and its Affiliates as a result of any such claim, action, loss liability, cost,
and expense of any kind, including reasonable attorneys fees, in respect
thereof, (i) in such proportion as will be appropriate to reflect the relative
benefits received by Franchisor and its Affiliates on the one hand and
Franchisee and its Affiliates on the other or (ii) if (but only if) the
allocation provided by clause (i) above is not permitted by Applicable Law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of Franchisor and
its Affiliates on the one hand and Franchisee and its Affiliates on the other
with respect to any claim, or action in respect thereof, as well as any other
relevant equitable considerations. Franchisee and Franchisor agree that it
would not be just and equitable if contributions under this Section 18.1 were
to be determined by pro rata allocation or by any other method of allocation
that does not take into account the equitable considerations referred to
herein. Franchisees obligations under this Section 18.1 will survive the
termination or expiration of this Agreement.

18.2 Limited
Franchisor Consent.

Franchisors
review of the Prospectus will be conducted solely for the benefit of Franchisor
to determine the accuracy and completeness of any description of Franchisors
relationship with Franchisee and compliance with the other requirements of
Section 18.1 and not to benefit or protect any other Person, and its consent
will not constitute any kind of authorization, acceptance or agreement,
endorsement, or ratification of the offering or Prospectus, either express or
implied.

19. DEFAULT AND TERMINATION

19.1 Immediate
Termination.

Franchisor
may terminate this Agreement and all rights granted to Franchisee under this
Agreement without affording Franchisee any opportunity to cure the default,
effective immediately upon notice to Franchisee (or upon such notice period or
cure period given by Franchisor in its sole discretion or as required by
Applicable Law), if:

A.
Franchisee or any Guarantor becomes insolvent, generally does not pay its debts
as they become due, admits that any of them is unable to pay its debts as they
become due, or makes a general assignment for the benefit of creditors; or
proceedings for a compromise with creditors are instituted by, against, or
consented to by Franchisee or any Guarantor; or

B.
Franchisee or any Guarantor files a voluntary petition under any bankruptcy,
insolvency, or similar law, or consents to an involuntary petition under any
bankruptcy, insolvency, or similar law filed against it; or an order approving
an involuntary petition in bankruptcy, insolvency, or similar declaration filed
against Franchisee or any Guarantor remains unvacated ninety (90) days after
the date of entry thereof; or

C.
a court of competent jurisdiction enters an order, judgment, or decree, on the
application of a creditor, adjudicating Franchisee or any Guarantor as
bankrupt, insolvent, or similar status or approving a petition seeking
reorganization or appointing a receiver, trustee, or liquidator of all

41

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or a substantial part of Franchisees or any Guarantors assets, and
such order, judgment, or decree remains unstayed and in effect for a period of
ninety (90) days or will be consented to by Franchisee or such Guarantor; or

D.
execution is levied against the Hotel, Franchisee, or any material real or
personal property comprising the Hotel in connection with a final judgment for
the payment of money; or

E.
a suit to foreclose any lien, mortgage, or security interest in the Hotel or
any material real or personal property that is a part of the Hotel, or any
security interest in Franchisee is initiated and not vacated within sixty (60)
days; or

F.
a threat or danger to public health or safety shall have occurred from the
construction, renovation, repair, refurbishment, upgrading, remodeling,
maintenance, or operation of the Hotel that, in the opinion of Franchisor,
could reasonably be expected to result in: (i) substantial liability or (ii) an
adverse effect on the Hotel, other System Hotels, the System, the Proprietary
Marks, or the goodwill associated therewith; provided, however, Franchisee may
request that Franchisor reinstate this Agreement, and Franchisor will
thereafter reinstate this Agreement, if, within six (6) months after
termination under this Section 19.1.F., the threat or danger to public health
or safety is eliminated and Franchisor has determined that such reinstatement
would not cause substantial liability or loss of goodwill; or

G.
Franchisee or any principal, director, officer, shareholder, or agent of
Franchisee contrary to the provisions of this Agreement discloses or causes to
be disclosed any Confidential Information provided to Franchisee or fails to
exercise reasonable care to prevent such disclosure; or

H.
(i) any of the representations and warranties by Franchisee under Sections 22.4
or 27 fails to be true and correct in any material respect when made, deemed
made, furnished or as of the date of this Agreement or (ii) any of the
representations and warranties by Franchisee under Sections 22.4 or 27 fails to
be true and correct at any time during the Term; or

I.
an inspection of Franchisees books and records under Section 15.3.B
establishes a pattern of underreporting by Franchisee involving three (3) or
more Accounting Periods within any twenty-four (24) month period; or

J.
Franchisee or any Interestholder of a Controlling Ownership Interest in
Franchisee is or has been convicted of a felony or other similar crime or
offense or has engaged in a pattern or practice of acts or conduct that is
likely in Franchisors judgment to, as a result of the adverse publicity that
has occurred in connection with such offense, acts, or conduct, adversely
affect the Hotel, other System Hotels, the System, the Proprietary Marks, the
goodwill associated therewith or Franchisors interests therein, any Franchisor
Lodging Facility or any other business conducted by Franchisor or any of its
Affiliates; or

K.
Franchisee becomes a Competitor or an Affiliate of a Competitor or a Transfer
occurs that does not comply with the provisions of Section 17 or 18; or

L.
(i) Franchisee dissolves or liquidates, (ii) Franchisee loses its right to
manage or operate the Hotel, (iii) Franchisee loses ownership or the right to
possession of the Hotel or the Approved Location, except as otherwise provided
in Section 21, or (iv) the Hotel ceases to operate as a System Hotel;

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M.
Franchisee fails to achieve the thresholds of performance established by the
Quality Assurance Program and such failure has not been cured within the
applicable cure period for such failure under the Quality Assurance Program; or

N.
if Franchisee or Owner is in default under the Lease or Owner Agreement, or if
the Lease or Owner Agreement is terminated for any reason.

19.2 Termination
Upon Notice with Opportunity to Cure.

Franchisor
may terminate this Agreement and all rights granted to Franchisee hereunder for
the reasons set forth below if (i) Franchisor gives Franchisee notice of
default that provides thirty (30) days for cure of the default (or such greater
number of days given by Franchisor in its sole discretion or required by
Applicable Law) and identifies the breach or breaches of this Agreement, and
(ii) Franchisee fails to cure in the time and manner specified in the notice of
default or as specifically provided in this Section 19.2:

A.
Franchisee fails to do any of the following in a timely manner to Franchisors
satisfaction: (i) perform any of the requirements stated in Exhibit B by the
dates required for commencement or completion of such requirements; or (ii)
begin or complete any renovation, repair, refurbishment, upgrading or remodeling
of the Hotel as required by Franchisor under Section 11.1 or any Standards for
the renovation, repair, refurbishment, upgrading or remodeling of the Hotel; or

B.
Franchisee and its Affiliates fail to pay any indebtedness to Franchisor or any
of its Affiliates when same becomes due and payable; or

C.
any Interestholder of a non-Controlling Ownership Interest in Franchisee, or
any officer, director, or employee of Franchisee is or has been convicted of a
felony or other crime or offense or has engaged in a pattern or practice of
acts or conduct that is likely, as a result of the adverse publicity that has
occurred in connection with such offense, acts or conduct, in Franchisors
judgment, to adversely affect the Hotel, other System Hotels, the System, the
Proprietary Marks, the goodwill associated therewith or Franchisors interests
therein, any Franchisor Lodging Facility or any other business conducted by
Franchisor or any of its Affiliates, and such Person is not terminated from its
relationship with Franchisee; or

D.
Franchisee fails to fully comply with the Standards or there occurs any other
breach of this Agreement or any of the other Marriott Agreements.

19.3 Termination
by Franchisor and Liquidated Damages.

A.
Franchisee has agreed to operate the Hotel as a System Hotel in compliance with
this Agreement for the Term. If Franchisee should fail to do so, Franchisee
acknowledges and agrees that Franchisor would be damaged in several ways,
including loss of future Franchise Fees and Marketing Fund Charges and injury
to the goodwill in the Proprietary Marks. Franchisee acknowledges and agrees
that it is difficult to estimate the revenues of the Hotel over a period of
years and that elements of Franchisors damages not directly calculated from
the Hotels revenues are inherently difficult to calculate and the proofs
thereof would be burdensome and costly (although such damages are real and
meaningful to Franchisor and the System). Franchisor and Franchisee agree that
liquidated damages (calculated as set forth in this Section 19.3) are not a
penalty and represent a reasonable estimate of just and fair compensation of
Franchisor for the damages that it would suffer if Franchisee should fail to
operate the Hotel as a System Hotel in compliance with this Agreement for the
Term. Upon termination of this Agreement under this Section 19, Franchisee will
promptly pay to Franchisor liquidated damages

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in an amount equal to (i) the average monthly Franchise Fees and
Marketing Fund Charges payable to Franchisor during the previous two (2) years times
(ii) the lesser of (x) thirty-six (36) or (y) one-half (1/2) the number of
months that would then otherwise remain in the Term. If the Hotel has not
opened with the approval of Franchisor or has not been operating as a System
Hotel pursuant to a franchise agreement for at least two (2) years (whether
pursuant to this Agreement or a franchise agreement between Franchisor and a
previous franchisee), the following will be used instead of clause (i) in the
above calculation: the greater of (a) the average monthly Franchise Fees and
Marketing Fund Charges payable to Franchisor for the previous two (2) years for
all United States System Hotels on a per room basis times the number of
rooms at the Hotel or (b) the average monthly Franchise Fees and Marketing Fund
Charges payable for the Hotel for the period during which the Hotel was opened
as a System Hotel; provided that if either party believes that such calculation
would not be representative of the projected stabilized performance of the
Hotel, the party will notify the other in writing and clause (i) in the above
calculation of liquidated damages will be recalculated by multiplying the
projected stabilized revenue for the Hotel submitted by Franchisee in its
franchise application by the highest percentage rates used to calculate
Marketing Fund Charges and any component of Franchise Fees in this Agreement.

B.
Franchisee further acknowledges and agrees that if this Agreement is terminated
with Special Circumstances (as defined below), Franchisor and the System will
suffer greater and fundamentally different damages due to the number or types
of Franchisor Lodging Facilities exiting the System, which practicably may not
be replaceable or, if replaceable, may take longer to replace due to the
Special Circumstances. The consequences of Special Circumstances include
significant loss of distribution in the markets served by the hotels, confusion
to customers and loss of customer confidence due to unavailability of
Franchisor Lodging Facilities in locations previously serviced by such
Franchisor Lodging Facilities, disadvantage to Franchisor in competing for
national accounts and other bookings, loss of foregone opportunities in markets
where the Franchisor Lodging Facilities were located and increased difficulty
in quality System growth. Therefore, Franchisor and Franchisee agree that if
this Agreement is terminated with Special Circumstances a distinct liquidated
damages calculation is warranted, as described below. If a termination occurs
with Special Circumstances, then Franchisee will pay to Franchisor the amount
of liquidated damages that is due under Section 19.3.A times the
applicable percentage stated in the chart below (Special Circumstances
Liquidated Damages). Special Circumstances means that, in addition to this
Agreement, one or more franchise, license or owner agreements between
Franchisor and Franchisee, or the respective Affiliates of either, are
terminated within a twelve-month period that includes the termination date of
this Agreement and the termination of any of such agreements together with the
termination of this Agreement involve at least one set of circumstances stated
in the first column of the chart below:

|                                                                                     |  |                         |     |                           |  |                           |   |                            |     |                              |  |                           |   |  |     |   |  |     |  
|------------------------------------------------------------------------------------ |  | ----------------------- | --- | ------------------------- |  | ------------------------- | - | -------------------------- | --- | ---------------------------- |  | ------------------------- | - |  | --- | - |  | --- | -
|                                                                                     |  | 2Agreements
 Terminated |     | 3-4Agreements
 Terminated |  | 5-8Agreements
 Terminated |   | 9-15Agreements
 Terminated |     | 16 25Agreements
 Terminated |  | >26Agreements
 Terminated |  
|                                                                                     |  |                         |     |                           |  |                           |   |                            |     |                              |  |                           |  
|5 or More Agreements For Franchisor Lodging Facilities Are
 Terminated               |  |                         | N/A |                           |  | N/A                       |   |                            | 125 | %                            |  | 175                       | % |  | 200 | % |  | 300 | %
|3 or More Agreements For Franchisor Lodging Facilities In
 Same State Are Terminated |  |                         | N/A |                           |  | 125                       | % |                            | 150 | %                            |  | 200                       | % |  | 250 | % |  | 300 | %

44

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|                                                                                                                                                                           |  |                         |     |                           |  |                           |   |                            |     |                              |  |                           |   |  |     |   |  |     |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------- | --- | ------------------------- |  | ------------------------- | - | -------------------------- | --- | ---------------------------- |  | ------------------------- | - |  | --- | - |  | --- | -
|                                                                                                                                                                           |  | 2Agreements
 Terminated |     | 3-4Agreements
 Terminated |  | 5-8Agreements
 Terminated |   | 9-15Agreements
 Terminated |     | 16 25Agreements
 Terminated |  | >26Agreements
 Terminated |  
|                                                                                                                                                                           |  |                         |     |                           |  |                           |   |                            |     |                              |  |                           |  
|3 or More Agreements For Franchisor Lodging Facilities in
 Top 20% of Room Count, Franchise Fees or GSS Score for Relevant System Are
 Terminated                          |  |                         | N/A |                           |  | 125                       | % |                            | 150 | %                            |  | 200                       | % |  | 250 | % |  | 300 | %
|3 or More Agreements For Franchisor Lodging Facilities in
 Same Metropolitan Statistical Area Are Terminated                                                               |  |                         | N/A |                           |  | 175                       | % |                            | 250 | %                            |  | 300                       | % |  | 300 | % |  | 300 | %
|2 or More Agreements For Franchisor Lodging Facilities With
 Over 400 Guestrooms that are the Major Group Representation in a Secondary or
 Tertiary Market Are Terminated |  |                         | 150 | %                         |  | 175                       | % |                            | 250 | %                            |  | 300                       | % |  | 300 | % |  | 300 | %
|2 or More Agreements For Franchisor Lodging Facilities
 Resorts or Hotels for Which at Least 50% of Guests are Leisure Travelers Are
 Terminated                           |  |                         | 150 | %                         |  | 175                       | % |                            | 250 | %                            |  | 300                       | % |  | 300 | % |  | 300 | %
|2 or More Agreements For JW Marriott Hotels Are Terminated                                                                                                                 |  |                         | 150 | %                         |  | 175                       | % |                            | 250 | %                            |  | 300                       | % |  | 300 | % |  | 300 | %

45

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For each agreement terminated, Special Circumstances Liquidated Damages
will be calculated using the largest applicable percentage multiplier in the
chart. By way of example, if six agreements for Franchisor Lodging Facilities
are terminated, five of which are for hotels located in the same state (and the
five agreements do not have any other applicable Special Circumstances), and
the remaining agreement is for a hotel located in another state (and it does not
have any other applicable Special Circumstances), the percentage multiplier for
each of the five agreements for hotels located in the same state will be 150%
(in the chart, see row entitled 3 or More Agreements For Franchisor Lodging
Facilities In Same State Are Terminated and column entitled 5-8 Agreements
Terminated) and the percentage multiplier for the remaining agreement will be
125% (in the chart, see row entitled 5 or More Agreements For Franchisor
Lodging Facilities Are Terminated and column entitled 5-8 Agreements
Terminated).

C.
If, in connection with the termination of this Agreement, the Hotel is
Transferred to a Competitor, or any other event specified in Section 17.4
occurs, as a result of which Franchisor has the rights provided therein, and
either (x) Franchisee does not comply with Franchisors right of first refusal
or comply with its other obligations relating to such right of first refusal
under Section 17.4 or (y) Franchisor elects to terminate this Agreement or
condition its consent to such Transfer on the payment of liquidated damages,
Franchisee will pay to Franchisor the amount of liquidated damages that is due
under Section 19.3.A times one hundred fifty percent (150%) (Competitor
Liquidated Damages). If the Transfer to a Competitor also involves Special
Circumstances for which the percentage multiplier is greater than 150%, as
determined under Section 19.3.B, Franchisee will promptly pay to Franchisor
Special Circumstances Liquidated Damages instead of Competitor Liquidated
Damages.

D.
In addition to liquidated damages, Franchisor will have the right to recover
reasonable attorneys fees and court costs incurred in collecting such sums
plus interest on all amounts due under Section 19.3 which will accrue at a rate
per annum equal to the Interest Rate from the date such liquidated damages are
due until paid. Such legal remedies will not preclude Franchisor from any
equitable remedies to which it may be entitled under Applicable Law. Franchisees
obligation to pay Franchisor liquidated damages, if applicable, and other sums
pursuant to Section 19.3 will survive termination of this Agreement. Payment of liquidated damages to Franchisor
will not affect the obligations of Franchisee to take action or abstain from
taking action after the termination of this Agreement as required by Section
19.3 and Section 20 or Franchisors remedies in the event that Franchisee does
not comply with its obligations thereunder.

|    |                              
|--- | -----------------------------
|20. | POST-TERMINATION             
|    |                              
|    | 20.1 Franchisee
 Obligations.

A.
Upon expiration or other termination of this Agreement, all rights granted
under this Agreement to Franchisee will immediately terminate and Franchisee,
at its expense, will comply with each of the following obligations:

(1)
Franchisee will immediately cease to operate the Hotel as a System Hotel and
will not directly or indirectly represent or give the impression that it is a
present or former franchisee or licensee of Franchisor or that the Hotel was
previously part of the System;

(2)
Franchisee will immediately and permanently cease to use and remove from the
Hotel and any other place of business any Intellectual Property and any other
identifying characteristics and marks of the System, including any Electronic
Systems, signs, fixtures, furniture, furnishings, equipment, advertising
materials, stationery, supplies, forms, or other articles that display any
Proprietary Marks or any trade dress or other distinctive features or designs
associated with Franchisor or the System. Any signs containing any Proprietary
Marks that Franchisee is unable to remove from the

46

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Hotel despite its best efforts upon termination or expiration of this
Agreement will be completely covered by Franchisee from view and physically
removed within twenty-four (24) hours after termination or expiration.
Franchisee also will immediately remove all content regarding Franchisor, the
System, and the Proprietary Marks from any Internet sites under its control and
will take all necessary actions required by Franchisor to disassociate itself
from Franchisor on the Internet. Franchisee will, at Franchisors option,
cancel or assign to Franchisor or its designee, any domain name owned by or
under the control of Franchisee or its Affiliates that contains any Proprietary
Mark, or any mark that is in Franchisors sole opinion confusingly similar,
including misspellings and acronyms;

(3)
Franchisee must take such action as may be necessary to cancel any fictitious,
trade, or assumed name or equivalent registration that contains any Proprietary
Mark or any variations thereof, and Franchisee must furnish Franchisor with
evidence satisfactory to Franchisor of compliance with this obligation within
thirty (30) days after termination or expiration of this Agreement;

(4)
Franchisee will immediately turn over to Franchisor the originals and all
copies of any Confidential Information, Intellectual Property, and all other
System materials relating to the operation of the Hotel and the System, or such
other information generated by Franchisee through its use of the System that is
deemed confidential by Franchisor, all of which are acknowledged by Franchisee
to be Franchisors property. Franchisee will not retain a copy or record of any
of the foregoing, except for Franchisees copy of this Agreement, any
correspondence between the parties, and any other documents that Franchisee
reasonably needs for compliance with any provisions of Applicable Law. If
Franchisor permits Franchisee to continue to use any Intellectual Property
after the termination or expiration date (such permission to be explicit and
specific), such use by Franchisee will be in accordance with the terms of this
Agreement;

(5)
Franchisee agrees that it will make no use of any of the Confidential Information
or System or disclose or reveal it or any portion thereof to anyone not
employed by Franchisor or its franchisees or licensees. Additionally,
Franchisee will not assist anyone not franchised or licensed to use the System
in constructing or equipping any hotel premises incorporating the distinctive
features or equipment layout that Franchisor (or any of its Affiliates) owns,
has originated, or developed and which are identifying characteristics of
businesses using the System; and

(6)
Franchisee will immediately make such alterations as may be necessary to
distinguish the Hotel clearly from its former appearance and other System
Hotels in order to prevent any possibility of confusion by the public.
Franchisee will make such specific additional changes as Franchisor may
reasonably request for this purpose. Until all alterations required by this
Section 20.1.A are completed, Franchisee must maintain a conspicuous sign at
the registration desk in a form specified by Franchisor, stating that the Hotel
is no longer associated with System Hotels. Franchisee will advise all
customers and prospective customers telephoning the Hotel that the Hotel is no
longer associated with System Hotels.

Franchisee
agrees that its failure to comply with any of the requirements of this Section
20.1.A will cause irreparable injury to Franchisor.

B.
Upon expiration or other termination of this Agreement, Franchisee will
promptly pay: (i) all amounts owing to Franchisor and any of its Affiliates;
(ii) any costs and expenses incurred by Franchisor, or fees charged by
Franchisor, in connection with removing the Hotel from the System; and (iii)
without limiting Franchisees obligations that relate to the period prior to
the date of such termination, an amount equal to a reasonable estimate of costs
and fees incurred or likely to be incurred, but not yet accumulated, billed
and/or invoiced, which will be due on the date Franchisee is notified of such
amount. Franchisor is entitled to receive interest on any amount not paid when
due

47

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hereunder which will accrue at a rate per annum equal to the Interest
Rate from the date such payment was due.

20.2 Franchisors
Rights Upon Termination or Expiration.

Upon
or prior to the termination or expiration of this Agreement, Franchisor may
give notice of the pending expiration or termination of this Agreement to, and
take such other action relating to, customers, suppliers, travel agents,
wholesalers, concessionaires, and other Persons that might be affected by such
expiration or termination.

20.3 Survival.

The
rights and obligations of the parties under this Section 20 will survive
termination or expiration of this Agreement.

21. CONDEMNATION AND CASUALTY

21.1 Condemnation.

Franchisee
will, at the earliest possible time, give Franchisor notice of any proposed
taking by eminent domain, condemnation, compulsory acquisition, or similar
proceeding. If such taking is substantial enough to render impractical the
continued operation of the Hotel in accordance with the System and guest
expectations, this Agreement will terminate upon notice by Franchisor or
Franchisee to the other party and the execution and delivery of a termination
agreement and release in form and substance acceptable to Franchisor, and
Franchisor and Franchisee will share equitably in the condemnation award;
provided, however, Franchisors portion of such award will be limited to
compensating Franchisor for Franchisors lost Franchise Fees under this
Agreement, which amount will not exceed the amount of the applicable liquidated
damages due under Section 19.3. Further, if such condemnation is the sole basis
for termination of this Agreement, Franchisors portion of such award will be
in lieu of payment of the applicable liquidated damages due under Section 19.3.
If such taking, in Franchisors opinion, will not render the continued
operation of the Hotel impractical, Franchisee must promptly make whatever
repairs and restorations are necessary to make the Hotel conform substantially
to its condition, character, and appearance immediately before such taking,
according to plans and specifications approved by Franchisor. Franchisee will
take all measures necessary to ensure that the resumption of normal operation
of the Hotel is not unreasonably delayed.

21.2 Casualty.

If
the Hotel is damaged or destroyed by fire or other cause and such damage or
destruction is substantial and material, affecting over fifty percent (50%) of
the Hotel, and necessitates the closing of the Hotel for a period in excess of
ninety (90) days, Franchisee will have the right to terminate this Agreement
upon notice to Franchisor given within ninety (90) days of such closing of the
Hotel if it elects not to repair or rebuild the Hotel. Franchisee will not be
required to pay Franchisor the liquidated damages due under Section 19.3 in
connection with such termination if such casualty is the sole basis for
termination of this Agreement and Franchisee executes and delivers to
Franchisor a termination agreement and release in form and substance acceptable
to Franchisor; provided, however, if subsequent to such notice and before the
date on which the Term would otherwise have ended under Section 4 if such
notice of termination had not been given (the Term Expiration Date),
Franchisee or any of its Affiliates or any Interestholder in Franchisee with an
Ownership Interest of twenty percent (20%) or greater operates a hotel;
vacation, timesharing, interval or fractional ownership facility; condominium;
apartment; or other lodging product at the Approved Location (the Other
Lodging Product), which Other Lodging

48

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Product is not operated under a license or franchise from Franchisor or
one of its Affiliates, then in such event, Franchisee will be obligated to
promptly pay to Franchisor an amount equal to the applicable liquidated damages
set forth in Section 19.3, but clause (ii) in the calculation of liquidated
damages in Section 19.3 will be the lesser of (a) thirty-six (36) or (b)
one-half (1/2) the number of months then remaining between (x) the date upon
which the Other Lodging Product is first operated, and (y) the Term Expiration
Date. Franchisees obligation set forth in this Section 21.2 will survive
termination of this Agreement. If the Hotel does not close for ninety (90) days
or Franchisee does not elect to terminate this Agreement in accordance with the
provisions of this Section 21.2, the Hotel will be promptly renovated and
reopened within a reasonable time in accordance with the System and pursuant to
plans and specifications approved by Franchisor in accordance with Section 6.2.

|                                        |                            
|--------------------------------------- | ---------------------------
|22. COMPLIANCE WITH LAWS; LEGAL ACTIONS
|                                        |                            
|                                        | 22.1 Compliance
 with Laws.

Franchisee
will comply with all Applicable Law, and will obtain in a timely manner all
permits, certificates, and licenses necessary for the full and proper operation
of the Hotel and compliance with the Marriott Agreements. Franchisee will
forward to Franchisor within seven (7) days of Franchisees receipt copies of
all inspection reports, warnings, certificates, and ratings issued by any
governmental entity related to the Hotel that indicate a material failure to
meet or maintain governmental standards regarding health or life safety or any
other material violation of Applicable Law that may adversely affect the
operation or financial condition of the Hotel or Franchisee.

22.2 Notice
Regarding Legal Actions.

Franchisee
will notify Franchisor within seven (7) days: (i) after the commencement of any
material action, suit, or other proceeding that involves the Hotel or
Franchisee; or (ii) after the commencement of any action, suit, or other
proceeding that involves Franchisor or Franchisors relationship with
Franchisee or the Hotel, and within seven (7) days of the issuance of any
judgment, order, writ, injunction, award, or other decree of any court, agency,
or other governmental instrumentality that may adversely affect the operation
or financial condition of the Hotel or Franchisee. Nothing in this Section 22.2,
however, will abrogate any notice requirement that Franchisee may have under
any insurance program or contract.

22.3 WAIVER
OF JURY TRIAL AND PUNITIVE DAMAGES.

FRANCHISEE
AND FRANCHISOR EACH HEREBY ABSOLUTELY, IRREVOCABLY AND UNCONDITIONALLY WAIVE
TRIAL BY JURY AND THE RIGHT TO CLAIM OR RECEIVE PUNITIVE DAMAGES IN ANY
LITIGATION, ACTION, CLAIM, SUIT OR PROCEEDING, AT LAW OR IN EQUITY, ARISING OUT
OF, PERTAINING TO OR IN ANY WAY ASSOCIATED WITH THE COVENANTS, UNDERTAKINGS,
REPRESENTATIONS OR WARRANTIES SET FORTH HEREIN, THE RELATIONSHIPS OF THE
PARTIES HERETO, WHETHER AS FRANCHISEE OR FRANCHISOR OR OTHERWISE, THIS
AGREEMENT OR ANY OTHER MARRIOTT AGREEMENT, OR ANY ACTIONS OR OMISSIONS IN
CONNECTION WITH ANY OF THE FOREGOING.

22.4 Specially
Designated National or Blocked Person; Anti-Money Laundering.

Franchisee
represents and warrants to Franchisor that: (i) neither Franchisee (including
any and all of its directors and officers), nor any of its Affiliates or the
funding sources for any of the foregoing is a Specially Designated National or
Blocked Person; (ii) neither Franchisee nor any of its

49

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Affiliates is directly or indirectly owned or controlled by the
government of any country that is subject to an embargo by the United States
government; and (iii) neither Franchisee nor any of its Affiliates is acting on
behalf of a government of any country that is subject to such an embargo.
Franchisee further represents and warrants that it is in compliance with any
applicable anti-money laundering law, including the USA Patriot Act. Franchisee
agrees that it will notify Franchisor in writing immediately upon the
occurrence of any event that would render the foregoing representations and
warranties of this Section 22.4 incorrect.

|                            |                                    
|--------------------------- | -----------------------------------
|23. RELATIONSHIP OF PARTIES
|                            |                                    
|                            | 23.1 Reasonable
 Business Judgment.

Except
where Franchisor has reserved sole discretion or as otherwise indicated in
this Agreement, Franchisor agrees to use Reasonable Business Judgment when
discharging its obligations or exercising its rights or discretion under this
Agreement, including with respect to any consents and approvals and the
administration of Franchisors relationship with Franchisee. Reasonable Business
Judgment, with respect to the System, means that Franchisors action or
inaction has a business basis that is intended to: (i) benefit the System or
the profitability of the System, including Franchisor, regardless of whether
some individual hotels may be unfavorably affected; (ii) increase the value of
the Proprietary Marks; (iii) increase or enhance overall hotel guest or
franchisee or owner satisfaction; or (iv) minimize possible brand
inconsistencies or customer confusion. If Franchisors action or exercise of
discretion is unrelated to the System (e.g., is related to a requested approval
with respect to the Hotel), as described above, Reasonable Business Judgment
means that Franchisor has a business basis and has not acted in bad faith.
Franchisee will have the burden of establishing that Franchisor failed to
exercise Reasonable Business Judgment, and neither the fact that Franchisor
benefited economically from an action nor the existence of other reasonable
alternatives will, by themselves, establish such failure. To the extent that
any implied covenant, such as the implied covenant of good faith and fair
dealing, or civil law duty of good faith is applied to this Agreement,
Franchisor and Franchisee intend that Franchisor will not have violated such
covenant or duty if Franchisor has exercised Reasonable Business Judgment.

23.2 Independent
Contractor.

A.
This Agreement does not create a fiduciary relationship between Franchisor and
Franchisee. Franchisee is an independent contractor, and nothing in this
Agreement is intended to constitute either party as an agent, legal
representative, subsidiary, joint venturer, partner, employee, or servant of
the other for any purpose, except that Franchisor will have the right to act on
Franchisees behalf as Franchisees Sales Agent.

B.
Nothing in this Agreement authorizes Franchisee to make any contract,
agreement, warranty, or representation on Franchisors behalf or to incur any
debt or other obligation in Franchisors name.

|                                                           |                     
|---------------------------------------------------------- | --------------------
|24. GOVERNING LAW; INJUNCTIVE RELIEF; COSTS OF ENFORCEMENT
|                                                           |                     
|                                                           | 24.1 Governing
 Law.

A.
This Agreement takes effect upon its acceptance and execution by Franchisor in
the State of Maryland, United States of America, and will be interpreted and
construed under the laws thereof, which laws will prevail in the event of any
conflict of law. Nothing in this Section 24.1 is intended, or will be deemed,
to make the Maryland Franchise Registration and Disclosure Law apply to

50

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this Agreement, or the transactions or relationships contemplated
hereby, if such law otherwise would not be applicable.

B.
Franchisee hereby expressly and irrevocably submits itself to the non-exclusive
jurisdiction of the courts of the State of Maryland, United States of America
for the purpose of any Dispute. So far as is permitted under Maryland law, this
consent to personal jurisdiction will be self-operative.

24.2 Injunctive
Relief.

Franchisor
will be entitled to injunctive or other equitable or judicial relief, without
the necessity of proving the inadequacy of money damages as a remedy, without
the necessity of posting a bond, and without waiving any other rights or
remedies at law or in equity, for any actual or threatened material breach or
violation of this Agreement or the Standards.

24.3 Costs
of Enforcement.

If
for any reason it becomes necessary for either party to initiate any legal or
equitable action to secure or protect its rights under this Agreement, the
prevailing party will be entitled to recover all costs incurred by it in
successfully enforcing such rights, including reasonable attorneys fees.

|            |              
|----------- | -------------
|25. NOTICES
|            |              
|            | 25.1 Notices.

A.
Subject to Section 25.1.B, all notices, requests, demands, statements, and
other communications required or permitted to be given under the terms of this
Agreement will be in writing and delivered by hand against receipt, sent by
certified mail (postage prepaid and return receipt requested), or carried by
reputable overnight courier service, to the respective party at the following
addresses:

| |                  |                                                     
| | ---------------- | ----------------------------------------------------
| | To
 Franchisor:  | Marriott
 International, Inc.                       
| |                  | 10400
 Fernwood Road                                
| |                  | Bethesda, MD
 20817                                 
| |                  | Attn:  Law
 Department 52/923.25                    
| |                  |                                                     
| | with a copy
 to: | Marriott
 International, Inc.                       
| |                  | 10400
 Fernwood Road                                
| |                  | Bethesda, MD
 20817                                 
| |                  | Attn:  Vice
 President, Owner and Franchise Services
| |                  | Department
 51/926.19                               
| |                  |                                                     
| | To
 Franchisee:  | APPLE TEN
 HOSPITALITY MANAGEMENT, INC.             
| |                  | 814 East
 Main Street                               
| |                  | Richmond, VA
 23219                                 
| |                  | Attn:  Krissy
 Gathright, Vice President            
| |                  | Email: kgathright@applereit.com                     

or at such other address as designated by notice from the respective
party to the other party. Any such notice or communication will be deemed to
have been given at the date and time of: (A) receipt or first

51

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refusal of delivery, if sent via certified mail or delivered by hand;
or (B) one day after the posting thereof, if sent via reputable overnight
courier service.

B.
Franchisor may provide Franchisee with routine information, invoices, the
Standards and other System requirements and programs, such as the Quality
Assurance Program, including any modifications thereto, by regular mail or by
e-mail, facsimile, or by making such information available to Franchisee on the
Internet, an extranet, or other electronic means.

|                                                                                      |                                     
|------------------------------------------------------------------------------------- | ------------------------------------
|26. CONSTRUCTION AND SEVERABILITY; APPROVALS, CONSENTS AND WAIVERS;
 ENTIRE AGREEMENT
|                                                                                      |                                     
|                                                                                      | 26.1 Construction
 and Severability.

A.
Except as expressly provided to the contrary in this Agreement, each section,
part, term and/or provision of this Agreement, including Section 16.1, will be
considered severable; and if, for any reason any section, part, term, or
provision is determined to be invalid, unenforceable or contrary to, or in
conflict with, any existing or future Applicable Law or by a court or agency
having valid jurisdiction, such will not impair the operation of, or have any
other effect upon, such other sections, parts, terms, and provisions of this
Agreement as may remain otherwise intelligible, and the latter will continue to
be given full force and effect and bind Franchisor and Franchisee. To the
extent possible, such invalid or unenforceable sections, parts, terms, or
provisions will be deemed to be replaced with a provision that is valid and
enforceable and most nearly reflects the original intent of the invalid or
unenforceable provision.

B.
No right or remedy conferred upon or reserved to Franchisor or Franchisee by
this Agreement is intended to be, nor will be deemed, exclusive of any other
right or remedy herein or by law or equity provided or permitted, but each will
be cumulative of every other right or remedy.

C.
Nothing in this Agreement is intended, or will be deemed, to create any third
party beneficiary or confer any rights or remedies under or by reason of this
Agreement upon any Person other than Franchisor (and its Affiliates) or
Franchisee, and their respective permitted successors and assigns.

D.
When this Agreement provides that Franchisor may take or refrain from taking
any action or exercise discretion, such as rights of approval or consent, or to
modify the System or any part of it, or to make other determinations or
modifications under this Agreement, Franchisor may do so from time to time.

E.
Unless otherwise stated, references to Sections are to Sections of this
Agreement.

F.
Unless otherwise stated, references to Exhibits, Attachments or Addenda are to
Exhibits, Attachments and Addenda to this Agreement, and all of such are
incorporated by reference into this Agreement.

G.
Words importing the singular include the plural and vice versa as the context
may imply. Words importing a gender include each gender as the context may
imply.

H.
References to days, months, and years are to calendar days, calendar months,
and calendar years, respectively.

52

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I.
The words include, included and including will be terms of enlargement or
example (meaning that, for instance, including will be read as including but
not limited to) and will not imply any restriction or limitation unless the
context clearly requires otherwise.

J.
Captions and section headings are used for convenience only. They are not part
of this Agreement and will not be used in construing it.

26.2 Approvals,
Consents and Waivers.

Except
as specifically provided in Sections 9.3.C and 9.4.C, the Management Company
Acknowledgment, or in Exhibit B, approvals, designations, and consents required
under this Agreement will not be effective unless evidenced by a writing signed
by the duly authorized officer or agent of the party giving such approval or
consent. No waiver, delay, omission, or forbearance on the part of Franchisor
or Franchisee to exercise any right, option or power arising from any default
or breach by the other party, or to insist upon strict compliance by the other
party with any obligation or condition hereunder, will affect or impair the
rights of Franchisor or Franchisee, respectively, with respect to any such
default or breach or subsequent default or breach of the same or of a different
kind. Any delay or omission of either party to exercise any right arising from
any such default or breach will not affect or impair such partys rights with
respect to such default or breach or any future default or breach. Franchisor
will not be liable to Franchisee for providing (or denying) any waiver,
approval, consent, or suggestion to Franchisee in connection with this
Agreement or by reason of any delay or denial of any request.

26.3 Entire
Agreement.

As
of the date of this Agreement, this Agreement, including, all exhibits,
attachments, and addenda, and the Marriott Agreements contain the entire
agreement between the parties as it relates to the Hotel and the Approved
Location. Nothing in this Agreement, however, is intended to require Franchisee
to waive reliance on any representations contained in the Franchise Disclosure
Document referred to in Section 27.4.C. This is a fully integrated agreement.

26.4 Amendments.

No
agreement of any kind relating to the matters covered by this Agreement will be
binding upon either party unless and until the same has been made in a written,
non-electronic instrument that has been duly executed by the non-electronic
signature of all interested parties. This Agreement may only be amended in a
written, non-electronic instrument that has been duly executed by the
non-electronic signature of all interested parties and may not be amended or
modified by conduct manifesting assent, or by electronic signature, and each
party is hereby put on notice that any individual purporting to amend or modify
this Agreement by conduct manifesting assent or by electronic signature is not
authorized to do so.

|                                              |                                                         
|--------------------------------------------- | --------------------------------------------------------
|27. REPRESENTATIONS, WARRANTIES AND COVENANTS
|                                              |                                                         
|                                              | 27.1 Existence
 and Power; Authorization; Contravention.

A.
Each party represents, warrants and covenants that: (i) it is a legal entity
duly formed, validly existing, and in good standing under the laws of the
jurisdiction of its formation; (ii) it and its Affiliates have and will
continue to have the ability to perform its obligations under this Agreement;
and (iii) it has and will continue to have all necessary power and authority to
execute and deliver this Agreement.

53

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B.
Each party represents, warrants and covenants that the execution and delivery
of this Agreement and the performance by such party of its obligations
hereunder: (i) have been duly authorized by all necessary action; (ii) do not require
the consent, vote, or approval of any third parties (including lenders) except
for such consents as have been properly obtained; and (iii) do not and will not
contravene, violate, result in a breach of, or constitute a default under (a)
its certificate of formation, operating agreement, articles of incorporation,
by-laws, or other governing documents, (b) any Applicable Law; or (c) any
agreement, indenture, contract, commitment, restriction or other instrument to
which it or any of its Affiliates is a party or by which it or any of its
Affiliates is bound.

C.
Franchisee represents and warrants that all of the representations and
warranties made in the application or any other information provided in
connection with this Agreement are true, correct and complete as of the time
made and as of the date hereof, regardless of whether such representations and
warranties were provided by Franchisee, one of its Affiliates, or by a third
party on behalf of Franchisee, unless Franchisee has notified Franchisor of a
change in the representations and warranties or the information and Franchisor
has approved the change.

27.2 Ownership
of Franchisee.

Franchisee
represents and warrants to Franchisor that Franchisee is owned directly and indirectly
as set forth on Exhibit A. Upon the request of Franchisor, Franchisee will
submit to Franchisor evidence, in form and substance satisfactory to
Franchisor, confirming that Franchisee is owned directly and indirectly as set
forth on Exhibit A.

27.3 Ownership
of the Hotel.

Franchisee
hereby represents, warrants and covenants to Franchisor that (i) Owner is the
sole owner of the Hotel, (ii) the Hotel is leased to Franchisee pursuant to the
Lease, and (iii) the Lease grants Franchisee full and exclusive control of the
Hotel and all rights, powers and authority with respect to the Hotel required
or desirable for the performance of Franchisees obligations hereunder. To the
extent that the Lease provides that any of the obligations of Franchisee
hereunder are to be performed by Owner, Franchisee agrees that it will cause
Owner to perform such obligations in accordance with this Agreement. Franchisee
acknowledges and agrees that neither the existence of the Lease nor any terms thereof
that require Owner to perform obligations of Franchisee hereunder will serve as
an assignment of such obligation to Owner (or Franchisors consent thereto) or
will relieve Franchisee of any obligation under this Agreement, and Franchisee
covenants that the Lease shall in no way limit or restrict Franchisors rights
or remedies under this Agreement.

27.4 Additional
Franchisee Acknowledgments and Representations.

A.
IN ENTERING THIS AGREEMENT, FRANCHISEE REPRESENTS AND WARRANTS THAT IT DID NOT
RELY ON, AND FRANCHISOR AND FRANCHISORS REPRESENTATIVES HAVE NOT MADE, ANY
PROMISES, REPRESENTATIONS, WARRANTIES OR AGREEMENTS RELATING TO FRANCHISING THE
HOTEL OR THE APPROVED LOCATION, EXCEPT AS EXPRESSLY CONTAINED IN THIS AGREEMENT
AND IN THE FRANCHISE DISCLOSURE DOCUMENT REFERRED TO IN SECTION 27.4.C.

B.
FRANCHISEE AGREES THAT THE BUSINESS VENTURE CONTEMPLATED BY THIS AGREEMENT
INVOLVES SUBSTANTIAL BUSINESS RISKS, IS A VENTURE WITH WHICH FRANCHISEE IS
FAMILIAR AND HAS RELEVANT EXPERIENCE AND ITS SUCCESS WILL BE LARGELY DEPENDENT
UPON THE ABILITY OF FRANCHISEE AS AN INDEPENDENT BUSINESS. FRANCHISOR EXPRESSLY
DISCLAIMS THE MAKING OF,

54

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AND FRANCHISEE AGREES FRANCHISEE HAS NOT RECEIVED, ANY INFORMATION,
WARRANTY OR GUARANTEE, EXPRESS OR IMPLIED, AS TO THE POTENTIAL VOLUME, PROFITS,
OR SUCCESS OF THE BUSINESS VENTURE CONTEMPLATED BY THIS AGREEMENT. IF
FRANCHISOR FURNISHES ADVICE, CONSULTATION, TRAINING, OR OTHER FORMS OF
ASSISTANCE IN CONNECTION WITH THE HOTEL OR THE APPROVED LOCATION WITH REGARD TO
MATTERS SUCH AS FINANCING, DESIGN, CONSTRUCTION, RENOVATION, MENU PLANNING,
OPERATION AND MANAGEMENT OF THE HOTEL, FRANCHISOR DOES NOT GUARANTEE OR ASSURE
THE SUCCESS OR SATISFACTORY RESULT OF SUCH MATTERS AND FRANCHISOR WILL NOT
THEREBY INCUR ANY LIABILITY OR BE RESPONSIBLE IN ANY WAY FOR ANY ERROR,
OMISSION OR FAILURE OF WHATEVER NATURE IN SUCH FINANCING, DESIGN, CONSTRUCTION,
RENOVATION, MENU PLANNING, OPERATION OR MANAGEMENT OF THE HOTEL OR THE APPROVED
LOCATION.

C.
FRANCHISEE ACKNOWLEDGES THAT FRANCHISEE RECEIVED A COPY OF THIS AGREEMENT, THE
EXHIBITS AND ATTACHMENTS HERETO, IF ANY, AND AGREEMENTS RELATING THERETO, IF
ANY, AT LEAST SEVEN (7) CALENDAR DAYS BEFORE THE DATE ON WHICH THIS AGREEMENT
WAS EXECUTED. FRANCHISEE FURTHER ACKNOWLEDGES THAT FRANCHISEE HAS RECEIVED THE
FRANCHISE DISCLOSURE DOCUMENT REQUIRED BY THE TRADE REGULATION RULE OF THE
FEDERAL TRADE COMMISSION ENTITLED DISCLOSURE REQUIREMENTS AND PROHIBITIONS
CONCERNING FRANCHISING, AT LEAST FOURTEEN (14) CALENDAR DAYS BEFORE THE DATE
ON WHICH FRANCHISEE EXECUTED THIS AGREEMENT OR MADE ANY PAYMENT TO FRANCHISOR
IN CONNECTION WITH THIS AGREEMENT.

D.
FRANCHISEE ACKNOWLEDGES THAT IT HAS READ AND UNDERSTOOD THE FRANCHISE DISCLOSURE
DOCUMENT REFERRED TO IN SECTION 27.4.C. PROVIDED TO FRANCHISEE, THIS AGREEMENT,
INCLUDING THE EXHIBITS AND ATTACHMENTS AND ADDENDA HERETO, IF ANY, AND RELATED
AGREEMENTS, IF ANY, AND FRANCHISEE HAS HAD AMPLE TIME AND OPPORTUNITY TO
CONSULT WITH ADVISORS AND LEGAL COUNSEL OF FRANCHISEES OWN CHOOSING ABOUT THE
POTENTIAL BENEFITS AND RISKS OF ENTERING INTO THIS AGREEMENT. FRANCHISEE AGREES
THAT FRANCHISEE HAS HAD AN OPPORTUNITY TO NEGOTIATE THIS AGREEMENT.

E.
NOTWITHSTANDING FRANCHISEES ACKNOWLEDGMENT IN SECTION 27.4.C ABOVE, FRANCHISEE
REPRESENTS THAT FRANCHISEES INITIAL INVESTMENT IN THE FRANCHISED BUSINESS IS
IN EXCESS OF ONE MILLION DOLLARS ($1,000,000), EXCLUDING THE COST OF UNIMPROVED
LAND AND ANY FINANCING RECEIVED FROM FRANCHISOR OR ITS AFFILIATES AND THUS IS
EXEMPTED FROM THE FEDERAL TRADE COMMISSIONS FRANCHISE RULE DISCLOSURE
REQUIREMENTS PURSUANT TO 16 CFR 436.8(a)(5)(i).

|                  |                                       
|----------------- | --------------------------------------
|28. MISCELLANEOUS
|                  |                                       
|                  | 28.1 Confidential
 Negotiated Changes.

Franchisee
acknowledges and agrees that the terms of this Agreement and all exhibits,
attachments or addenda or other agreements ancillary to, or executed in
connection with this agreement, that have been negotiated (negotiated terms)
from the standard form of agreements set forth in the Franchise Disclosure
Document referred to in Section 27.4.C are strictly confidential and Franchisee
will

55

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not disclose such negotiated terms to any Person without the prior
consent of Franchisor except (1) as required by law, (2) as may be
necessary to enforce this Agreement in any legal proceedings, or (3) to
those of Franchisees managers, members, officers, directors, employees,
attorneys, accountants, agents or lenders as is necessary for the operation or
financing of the Hotel. It will be a material default hereunder if Franchisee,
its managers, members, officers, directors, employees, attorneys, accountants,
agents or lenders disclose the negotiated terms to any unauthorized Person
without the prior consent of Franchisor.

28.2 Multiple
Counterparts.

This
Agreement may be executed in a number of identical counterparts, each of which
will be deemed an original for all purposes and all of which will constitute,
collectively, one agreement. Delivery of an executed signature page to this
Agreement by electronic transmission will be effective as delivery of a
manually signed counterpart of this Agreement.

IN WITNESS
WHEREOF, the parties hereto have duly executed and delivered this Relicensing
Franchise Agreement, under seal, as of the Effective Date.

|                       |  |                                          |                      |                              | 
|---------------------- |  | ---------------------------------------- | -------------------- | ---------------------------- | 
|                       |  | FRANCHISOR:                             
|                       |  |                                          |                     
|ATTEST:                |  | MARRIOTT
 INTERNATIONAL, INC.           
|                       |  |                                          |                     
|                       |  | By:                                      | /s/ James C.
 Fisher | (SEAL)                      
|                       |  |                                          |                      |                             
|Assistant
 Secretary   |  | Name: James
 C. Fisher                  
|                       |  | Title:
 Senior Vice President           
|                       |  |                                          |                     
|                       |  | FRANCHISEE:                             
|                       |  |                                          |                     
|ATTEST:                |  | APPLE TEN
 HOSPITALITY
 MANAGEMENT, INC.
|                       |  | a Virginia corporation                  
|                       |  |                                          |                     
|/s/ Amy D.
 Kramer     |  |                                          | By:                  | /s/ Justin
 G. Knight (SEAL)
|                       |  |                                          |                      |                              | 
|(Assistant)
 Secretary |  | Name: Justin
 G. Knight                 
|                       |  | Title:
 President                       

56

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EXHIBIT A

APPROVED LOCATION, NUMBER OF GUESTROOMS AND OWNERSHIP INTERESTS IN FRANCHISEE

|   |                                             
|-- | --------------------------------------------
|1. | Approved Location of the
 Hotel:            
|   |                                             
|   | 250 East
 Exchange Blvd., Columbia, SC 29209
|   |                                             
|2. | Approved
 Number of Guestrooms:             
|   |                                             
|   | 91                                          
|   |                                             
|3. | Name of
 Entity That Will Operate the Hotel:
|   |                                             
|   | Newport
 Columbia Management, LLC           
|   |                                             
|4. | Ownership Interest(s) in
 Franchisee:       

|                                                                               |  |  |            |  
|------------------------------------------------------------------------------ |  |  | ---------- | -
|Ownership of Apple Ten Hospitality Management, Inc.                            |  |  | % Interest |  
|                                                                               |  |  |            |  
|Apple Ten Hospitality Management, Inc.814 East Main Street
 Richmond, VA 23219 |  |  | 100        | %
|                                                                               |  |  |            |  
|Ownership of Apple Ten Hospitality, Inc.                                       |  |  | % Interest |  
|                                                                               |  |  |            |  
|Apple REIT Ten, Inc.814 East Main Street 
 Richmond, VA 23219                  |  |  | 100        | %
|                                                                               |  |  |            |  
|Ownership of Apple REIT Ten, Inc.                                              |  |  | % Interest |  
|                                                                               |  |  |            |  
|Publicly-Held Company                                                          |  |  | 100        | %

57

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EXHIBIT
B

CHANGE
OF OWNERSHIP RIDER

Franchisee
desires that the Hotel continue to be operated as a System Hotel and the
following additional terms and provisions and modifications to the Agreement
will apply, which are an integral part of the Agreement:

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|1. | Section
 2.1 is hereby amended by inserting the following sentence at the beginning of
 such Section:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|   | On
 or before the Effective Date, Franchisee has (i) caused Existing Franchisee
 to deliver to Franchisor the Termination Agreement duly executed by all
 parties thereto other than Franchisor and (ii) paid Franchisors outside
 legal counsel fees and expenses incurred in connection with the review,
 preparation and negotiation of this Agreement and ancillary documents related
 thereto.                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|2. | Section
 3 is hereby amended by adding a new Section 3.11 at the end of such Section,
 which reads as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|   | 3.11
 Initial Accounting Period Charges.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|   | Franchisee
 agrees that, except for amounts due pursuant to Sections 3.2 or 3.3.A above,
 if the Effective Date is not the first day of an Accounting Period then, for
 the Accounting Period in which the Effective Date occurs (the Initial
 Accounting Period), Franchisee must pay to Franchisor all amounts due to
 Franchisor or its Affiliates with respect to the operation of the Hotel for the
 entire Initial Accounting Period as though the term of this Agreement had
 begun on the first day of the Initial Accounting Period, and that any dispute
 between Franchisee and Existing Franchisee concerning the allocation of
 payments for the Initial Accounting Period will be no defense to Franchisees
 obligations pursuant to this Section 3.11.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|3. | The
 reference to the Opening Date in the first sentence of Section 11.2.B is
 amended to be a reference to the Effective Date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|4. | Section
 27.4 is hereby amended by adding the following new Paragraphs F and G after
 Paragraph E:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|   | F.
 FRANCHISEE ACKNOWLEDGES THAT FRANCHISOR (i) DID NOT ENDORSE, RECOMMEND, OR
 OTHERWISE CONCUR WITH THE TERMS OF ANY TRANSACTION PURSUANT TO WHICH
 FRANCHISEE MAY HAVE ACQUIRED THE RIGHT TO OPERATE THE HOTEL FROM A PRIOR
 FRANCHISEE OF FRANCHISOR; (ii) DID NOT PARTICIPATE IN THE DECISION REGARDING
 THE PRICE OR COMPENSATION TO BE PAID BY FRANCHISEE TO ANY THIRD PARTY FOR
 SUCH RIGHT, WHICH DECISION WAS MADE WITHOUT ANY INTERVENTION, SUPPORT OR
 PARTICIPATION BY FRANCHISOR; AND (iii) DID NOT COMMENT UPON ANY FINANCIAL
 PROJECTIONS SUBMITTED TO FRANCHISEE BY OR ON BEHALF OF ANY PRIOR FRANCHISEE.                                                                                                                                              

58

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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
| | G.
 FRANCHISEE ACKNOWLEDGES AND AGREES TO BE BOUND BY ALL ANCILLARY AGREEMENTS
 BETWEEN EXISTING FRANCHISEE AND FRANCHISOR, INCLUDING, BUT NOT LIMITED TO,
 ANY LICENSING AGREEMENTS, COST SHARING AGREEMENTS, CLUSTER REVENUE
 AGREEMENTS, AND ANY OTHER AGREEMENTS RELATING TO THE EXISTING FRANCHISE
 AGREEMENT. FRANCHISEE AGREES TO EXECUTE ANY SEPARATE ACKNOWLEDGEMENTS OR
 AMENDMENTS TO SUCH AGREEMENTS SIGNIFYING FRANCHISEES AGREEMENT TO BE BOUND
 BY SUCH AGREEMENTS AS FRANCHISOR MAY REASONABLY REQUEST.

59

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PROPERTY
IMPROVEMENT PLAN ADDENDUM

Franchisee agrees to upgrade and renovate the Hotel at the Approved
Location in accordance with the following terms and provisions in order for
Franchisee to use the System and continue to operate the Hotel as a System
Hotel:

1. Scope
of Work; Drawings and Specifications.

A.
Franchisor and Franchisee have agreed to the construction, upgrading, and
renovation requirements set forth in Attachment One to this Property
Improvement Plan Addendum (the Scope of Work) in order for Franchisee to use
the System and continue to operate the Hotel as a System Hotel. All work,
including, furniture, fixtures, equipment, furnishings, materials and signs in
the Scope of Work must comply with the Standards and this Agreement. The Scope
of Work is in addition to, and the completion of such work does not satisfy,
Franchisees obligation to periodically upgrade and renovate the Hotel pursuant
to Section 11.1.B of this Agreement, which obligation is independent of
Franchisees obligation to complete the Scope of Work.

B.
If any material changes to the Hotel occur after February 18, 2011 but before
completion of the Scope of Work, then the Hotel will be subject to reinspection
by Franchisor (Material Change Review) and Franchisor reserves the right to
modify the Scope of Work, including by adding additional requirements to the
Scope of Work, to address the material changes to the Hotel and Franchisee
agrees that it will be required to complete the requirements in the modified
Scope of Work to Franchisors satisfaction in the time period required by
Franchisor, in addition to the other requirements in this Property Improvement
Plan Addendum. Franchisee must cooperate fully, and must cause its contractor
and subcontractors to cooperate fully, with any inspections conducted by
Franchisor pursuant to a Material Change Review. If a Material Change Review is performed,
Franchisor reserves the right to charge Franchisee its then-current fee for
such reinspection.

C.
Within ten (10) days of the Effective Date, Franchisee will obtain from
Franchisor the Design Criteria. Upon receipt thereof, Franchisee will engage a
qualified registered architect, interior designer, and other qualified
consultants and cause them to: (i) adapt the Design Criteria to the Approved
Location and to Applicable Law, including
the Americans with Disabilities Act and/or other similar state laws, codes,
and/or regulations governing public accommodations for persons with
disabilities, (ii) prepare complete construction documents, including a
site plan and architectural, mechanical, electrical, civil engineering,
landscaping and interior design drawings and specifications, and material
samples, in each case, based on the Design Criteria and the Scope of Work
(collectively, the Plans), and (iii) submit the Plans to Franchisor to review
for compliance with the Design Criteria and Scope of Work at least sixty (60)
days prior to commencing work on the items in the Scope of Work. Franchisee
will not deviate from the Design Criteria in the Plans. Franchisor may charge
Franchisee an amount equal to One Hundred Thirty Dollars ($130) multiplied by
the number of hours required to review the Plans.

D.
If requested by Franchisor, Franchisee will provide to Franchisor the name, address,
and relevant work experience on similar projects for any architect, engineer,
design firm or general contractor that Franchisee wishes to retain, and
Franchisor will have thirty (30) days after receipt of such information to
notify Franchisee of its election to consent or withhold its consent.
Franchisors election to consent or withhold its consent will be based on prior
experiences of Franchisor and its Affiliates with such Person, such Persons
general business reputation, and such Persons relevant work experience on
similar projects. If Franchisor does not respond to Franchisee within thirty
(30) days after Franchisors receipt of such information, then Franchisee may
retain such Person. Neither Franchisors failure to respond within the required
time period nor Franchisors consent to Franchisees use of such

60

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Person will be deemed an endorsement or recommendation by Franchisor of
any such Person. Franchisee acknowledges and agrees that Franchisor is not
liable for the unsatisfactory performance of any Person retained by Franchisee.

E.
Franchisor will promptly review the Plans for compliance with the
Design Criteria and the Scope of Work. If Franchisor determines that the Plans
do not satisfy such requirements, Franchisor will provide recommended changes
to Franchisee that Franchisee will incorporate into the Plans and resubmit to
Franchisor for its review. Each party will act speedily and in good faith in
the preparation, submission, review and revision of the Plans. Franchisee will
not begin work on the Scope of Work until Franchisor notifies Franchisee that
the Plans satisfy such requirements. As soon as reasonably possible after
Franchisor notifies Franchisee that the Plans comply with the Design Criteria
Franchisee will submit to Franchisor two (2) sets of the final Plans and a cost
estimate for the Scope of Work. Once finalized, the Plans will not be changed,
including changes required by governmental authorities, without the prior
written consent of Franchisor.

F.
Franchisee agrees that Franchisee, and not Franchisor or its Affiliates, is
responsible for: (i) ensuring that any design, construction documents,
specifications, and any construction, renovation, or refurbishment complies
with any Applicable Law, including any requirements relating to disabled
persons; (ii) any errors or omissions; or (iii) discrepancies (of any nature)
in any drawings or specifications. Franchisee further acknowledges and agrees
that: (a) Franchisors review of the Plans is limited solely to determining
whether the Plans comply with the Design Criteria and the Scope of Work; and
(b) Franchisor will have no liability or obligation with respect to renovation,
upgrading or furnishing of the Hotel. Except for Franchisees own uses related
to its construction or operation of the Hotel, Franchisee will not reproduce,
use or permit the use of any of the design concepts, drawings, or Standards.

2. Renovation
of the Hotel.

A.
Franchisee agrees to perform each item in the Scope of Work by the date set
forth in the Scope of Work with respect to such item and Franchisee agrees that
it will not use any portion of the Reserve to pay for the Scope of Work. Time
is of the essence, but the deadline for completion of items in the Scope of
Work will be equitably extended by reason of any delay caused by acts of God,
the public enemy, strikes, war, governmental restrictions, or other causes
beyond Franchisees control (excluding for the avoidance of doubt, unavailability
of financing), except that no such extension will be made for aggregate delays
in excess of thirty (30) days unless a request for additional time is made in
writing to Franchisor giving reasons for the delay, and under no circumstances
will such extension exceed one hundred and eighty (180) days. In addition, upon
Franchisees written request and provided Franchisee has diligently pursued
renovation of the Hotel, Franchisor may, in its sole discretion, extend the
deadlines any item in the Scope of Work. Extension requests will be considered
in increments of one or more months, provided, however, no more than two (2)
extensions totaling six (6) months in the aggregate will be considered. For any
extension, Franchisor will have the right to require Franchisee to pay to
Franchisor a nonrefundable extension fee not to exceed Two Thousand Dollars
($2,000) per month for each month of the extension. The extension fee will be
paid to Franchisor with the written request for the extension and will be fully
refunded in the event Franchisor declines to grant the requested extension.

B.
Franchisee will obtain all permits and certifications required for lawful
renovation, upgrading and operation of the Hotel, including zoning, access, sign, building permits and
fire requirements, and will certify in writing to Franchisor, if
requested, that all such permits and certifications have been obtained.

61

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C.
Franchisee will possess or obtain adequate financing for renovation, upgrading and
furnishing the Hotel and Franchisee will bear the entire cost of renovation,
upgrading, equipping, supplying and furnishing the Hotel, including all
FF&E, Electronic Systems and other items and equipment as specified by
Franchisor for the System.

D.
Franchisee will
ensure that the Hotel complies with Applicable
Law and the Standards, including Franchisors Fire Protection and Life
Safety standards (even if such standards exceed federal, state or local code
requirements).

E.
During the renovation and upgrading period, Franchisor or its representatives
will have the right to visit the job site at any time in order to observe the
work and Franchisee will cooperate fully, and will cause its contractors and
subcontractors to cooperate fully, with any site visits conducted by
Franchisor.

F.
Franchisee must, upon the earlier of (i) completion of the work or (ii) the
first anniversary of the Effective Date, provide to Franchisor a written
certificate or opinion from its architect, licensed professional engineer, or
recognized expert consultant on the Americans with Disabilities Act stating
that the Hotel conforms to the requirements of the Americans with Disabilities
Act, the related federal regulations, and all other applicable state and local
laws, regulations and other requirements governing public accommodations for
persons with disabilities. If the completion date for any item or items set
forth in the Scope of Work extends beyond the first anniversary of the
Effective Date, Franchisee must provide an additional certificate to Franchisor
with respect to such item or items upon final completion of all work related to
any and all such items. The certificate or opinion will be in the form attached
to this Change of Ownership Rider as Attachment Two.

G.
The Hotel is subject to further review by Franchisor to, among other things,
ensure that the Hotel complies with the requirements of this Property
Improvement Plan Addendum (PIP Review). Franchisee must ensure that the Hotel
complies with all requirements specified by Franchisor following any PIP
Review. Franchisee must cooperate fully, and must cause its contractors and
subcontractors to cooperate fully, with any inspections conducted by Franchisor
pursuant to any PIP Review. If Franchisor determines that the Scope of Work was
not completed to Franchisors satisfaction, Franchisee will be charged
Franchisors then-current fee to perform a re-inspection, which may increase
for any subsequent re-inspections until Franchisor determines that the Scope of
Work is completed to its satisfaction.

H.
Franchisor will not be deemed to have approved any work done pursuant to this
Property Improvement Plan Addendum unless such approval is set forth in writing
and signed by Franchisors authorized representative. If such approval is
partial or contingent, Franchisee hereby authorizes its general manager of the
Hotel or Franchisees director of operations (or a person with a different title but
similar duties) to acknowledge in writing the additional work to be performed
and the time within which such work will be performed, and such written
acknowledgement will be binding on Franchisee.

62

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ATTACHMENT
ONE

TO
PROPERTY IMPROVEMENT PLAN ADDENDUM

SCOPE OF
WORK

All
items must be completed within six (6) months of the Effective Date, unless
otherwise noted with respect to a particular item.

|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                             |  | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------- |  | 
|Description                                                                                                                                                                          |                                | Due Date                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Comments                                                                                                                   
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                            
|I.                                                                                                                                                                                   | BUILDING
 INTERIOR - GENERAL   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                             | 
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                     |                                | Décor Package Requirement  Must use Uptown package or
 submit a custom décor package for Marriott review and approval prior to
 installation.                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                     | 1.                             | Implement
 the current design concepts in the public space and guestrooms, pursuant to
 the published design requirements, and all remaining requirements of a 6 year
 renovation per TownePlace Suites renovation standards. The completed
 renovation must comply with the TownePlace Suites renovation requirements and
 product specifications that are most current at the time of the renovation.
 All renovation information can be accessed on the CFRST New Build and
 Renovation web site. (Buzzsaw) |  | 5/2015
 in connection with the next renovation and upgrade required pursuant to
 Section VII.D. of the Franchise Agreement. |  | 
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                             |  | 
|II.                                                                                                                                                                                  | FIRE
 PROTECTION / LIFE SAFETY
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                             |  | 
|                                                                                                                                                                                     |                                | Property
 must comply with all standards and requirements as detailed in the Fire and
 Life Safety Audit items listed below regardless of current status of
 compliance with local codes or previous franchiser guidelines                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Required completion timeframe is from the Effective Date.                                                                                                                            |                                | Due Date                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|This
 property was surveyed by Lenny Johnson on February 25, 2011. In accordance
 with Marriotts Module 14 or national codes, the change of ownership
 requirements are as follows: |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Within 30 days of
 agreement execution:                                                                                                                                              |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                     | 1.                             | There
 should be no storage within 18 of any sprinkler head - Remove storage from
 within 18 of sprinkler head in main riser/engineering shop, back office,
 meeting room closets, employee break room, laundry room, & breakfast prep
 room.                                                                                                                                                                                                                                                                |  |                                                                                                                            
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                             |  | 
|                                                                                                                                                                                     | 2.                             | Store
 all flammable containers i.e. paint, etc in a yellow fire proof cabinet in
 engineering shop.                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                                                                                                            
|                                                                                                                                                                                     |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 
|                                                                                                                                                                                     | 3.                             | Install a sprinkler head
 in closet under Stair A  level 1.                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                                                                                                            

63

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|                                         |    |                                                                                                              |  |  |  | 
|---------------------------------------- | -- | ------------------------------------------------------------------------------------------------------------ |  |  |  | 
|                                         |    |                                                                                                              | 
|                                         | 4. | Remove
 storage from 3rd floor electric room at elevator lobby. No storage
 within 36 of electrical panels. |  | 
|                                         |    |                                                                                                              | 
|                                         | 5. | Repair
 ceiling around sprinkler head in both meeting room closets.                                          |  | 
|                                         |    |                                                                                                              | 
|                                         | 6. | Repair
 the low hanging sprinkler head  2nd floor elevator lobby (near room
 218).                          |  | 
|                                         |    |                                                                                                              | 
|Within
 180 days of agreement execution: |    |                                                                                                             
|                                         |    |                                                                                                             
|                                         | 7. | Chain
 & lock all control valves in public spaces.                                                           |  | 
|                                         |    |                                                                                                              |  |  |  | 
|                                         | 8. | Repair
 hole in wall of closet in storage room  air conditioner closet, & 2nd
 floor laundry chute closet.  |  | 

64

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ATTACHMENT TWO

TO PROPERTY IMPROVEMENT PLAN ADDENDUM

ADA CERTIFICATION

(TO BE COMPLETED BY FRANCHISEES ARCHITECT, ENGINEER,
ADA

CONSULTANT, OR OTHER LICENSED PROFESSIONAL)

In
connection with the TownePlace Suites Columbia Southeast/Fort Jackson (the
Hotel), I hereby represent and certify to Apple Ten Hospitality Management,
Inc. and to Marriott International, Inc. that:

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(i)  | I
 have used professionally reasonable efforts to ensure that the Hotel conforms
 to and complies with the design standards and requirements of the Americans
 with Disabilities Act (ADA), the ADA Architectural Guidelines (ADAAG),
 and all other related or similar state and local laws, regulations, and other
 requirements governing public accommodations for persons with disabilities in
 effect at the time that this certification is made, and
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|(ii) | In
 my professional judgment, the Hotel does in fact conform to and comply with
 such design standards and requirements.                                                                                                                                                                                                                                                                                                                                        



| |             | 
| | ----------- | 
| | By:         | 
| |             | 
| | Print Name: | 
| |             | 
| | Firm:       | 
| |             | 
| | Date:       | 
| |             | 
| |             | 

65

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EXHIBIT
C

RESTRICTED
TERRITORY MAP

66

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GUARANTY

This
GUARANTY (Guaranty) is executed as of ___________________, 2011, by Apple Ten Hospitality, Inc., a
corporation organized and existing under the laws of Virginia (Guarantor), in
favor of and for the benefit of Marriott International, Inc., a Delaware
corporation (Franchisor). In consideration of and as an inducement to
Franchisor to execute the Relicensing Franchise Agreement dated as of
__________________, 2011 (as such agreement may be amended, supplemented,
restated or otherwise modified, the Agreement), by and between Franchisor and
Apple Ten Hospitality Management, Inc.,
a Virginia corporation (Franchisee), Guarantor hereby agrees as
follows:

1.
Guarantor hereby unconditionally warrants to Franchisor and its successors and
assigns that all of Franchisees representations and warranties (i) in any
application submitted by or on behalf of Franchisee to Franchisor in connection
with any Marriott Agreement and (ii) in any Marriott Agreement are true,
accurate and complete as of the time made and as of the date hereof. Further,
Guarantor unconditionally guarantees that all of Franchisees obligations under
the Agreement and any other Marriott Agreement will be punctually paid and
performed.

2. Upon
default by Franchisee and notice from Franchisor, Guarantor will immediately
make each payment and perform each obligation required by Franchisee under the
Agreement and any other Marriott Agreement. Franchisor may extend, modify or
release any indebtedness or obligation of Franchisee, or settle, adjust or
compromise any claims against Franchisee without notice to Guarantor and any
such action will not affect the obligations of Guarantor under this Guaranty.
Guarantor hereby waives notice of any amendment, supplement, restatement or
other modification of the Agreement and any other Marriott Agreement and notice
of demand for payment or performance by Franchisee. Guarantors guarantee
hereunder will extend to any extension or renewal of the Agreement and any
other Marriott Agreement.

3.
Guarantor hereby agrees that the obligations of Guarantor under this Guaranty
will not be reduced, limited, terminated, discharged, impaired or otherwise
affected by: (i) Franchisees failure to pay a fee or provide other
consideration to Guarantor in consideration for the issuance of this Guaranty;
(ii) the occurrence or continuance of a default under the Agreement or any
other Marriott Agreement; (iii) any assignment of the Agreement or any other
Marriott Agreement; (iv) any modification or amendment of, or waiver or consent
or other action taken with respect to, the Agreement or any other Marriott
Agreement, including any indulgence in or extension of time for the payment of
any amounts payable of Franchisee under or in connection with the Agreement or
any other Marriott Agreement or for the performance of any other obligation of
Franchisee under the Agreement or any other Marriott Agreement (any of which
modifications, amendments, waivers or consents may be agreed to or granted
without the approval or consent of Guarantor); (v) the voluntary or involuntary
liquidation, sale or other disposition of all or any portion of Franchisees
assets, or the receivership, insolvency, bankruptcy, reorganization or similar
proceedings affecting Franchisee or its assets or the release or discharge of
Franchisee from any of its obligations under the Agreement or any other
Marriott Agreement or (vi) any change of circumstances, whether or not
foreseeable, and whether or not any such change does or might vary the risk of
Guarantor hereunder. No failure of Franchisor to exercise any power or right
hereunder, or to insist upon compliance by Guarantor with any term hereof will
constitute a waiver of Franchisors right thereafter to demand full compliance
with any term herein.

4. This
Guaranty constitutes a guaranty of payment and performance and not of
collection, and Guarantor specifically waives any obligation of Franchisor to
proceed against Franchisee on any money or property held by Franchisee or by
any other Person as collateral security, by way of set-off or otherwise or
against any other guarantor. Guarantor further agrees that this Guaranty will
continue to be effective or be reinstated as the case may be, if at any time
payment of any of the guaranteed obligations

67

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is rescinded or must otherwise be restored or returned by Franchisor
upon the insolvency, bankruptcy or reorganization of Franchisee or Guarantor,
all as though such payment has not been made.

5. Except
as otherwise expressly set forth herein, all notices, requests, demands,
statements and other communications required or permitted to be given hereunder
will be in writing and will be delivered by nationally recognized overnight
courier service to Franchisor at the address set forth in the Agreement and to
Guarantor at the address set forth below or for either at such other address as
may be designated by Guarantor or by Franchisor, and such communication will be
effective three days after the day sent. This Guaranty may be amended only by a
written instrument signed by a duly authorized representative of each of
Guarantor and Franchisor.

6.
Guarantor hereby unconditionally and irrevocably waives notice of acceptance of
this Guaranty, presentment, demand, diligence, protest and notice of dishonor
or of any other kind to which Guarantor otherwise might be entitled under
applicable law.

7.
Guarantor agrees to pay Franchisor all expenses, including reasonable
attorneys fees and court costs, incurred by Franchisor, its subsidiaries,
Affiliates, or any of their respective successors and assigns, to remedy any
defaults of or enforce any rights under this Guaranty, the Agreement or any
other Marriott Agreement, effect termination of this Guaranty, the Agreement or
any other Marriott Agreement, or to collect any amounts due under this
Guaranty, the Agreement or any other Marriott Agreement.

8. If more
than one Person has executed this Guaranty as a Guarantor hereunder, the
liability of each such Guarantor will be joint, several and primary. This
Guaranty may be executed in any number of counterparts, each of which will be
deemed an original, but all of which, when taken together, will constitute one
and the same instrument. Delivery of an executed signature page to this
Guaranty by facsimile transmission will be effective as delivery of a manually
signed counterpart of this Guaranty.

9. Upon the
death of any individual Guarantor, the estate of such Guarantor will be bound
by this Guaranty but only for defaults and obligations hereunder existing at
the time of death, and the obligations of any other Guarantors will continue in
full force and effect.

10. Guarantor represents and warrants to
Franchisor that: (i) neither Guarantor
(including any and all of its directors and officers), nor any of its
Affiliates or the funding sources for any of the foregoing is a Specially
Designated National or Blocked Person; (ii) neither Guarantor nor any of its Affiliates is directly or indirectly
owned or controlled by the government of any country that is subject to an
embargo by the United States government; and (iii) neither Guarantor nor any of its Affiliates is
acting on behalf of a government of any country that is subject to such an
embargo. Guarantor further
represents and warrants that it is in compliance with any applicable anti-money
laundering law, including the USA Patriot Act. Guarantor agrees that it will notify Franchisor in writing
immediately upon the occurrence of any event that would render the foregoing
representations and warranties of this Section 10 incorrect.

11.
This Guaranty is executed pursuant to, and will be construed under and governed
by, the laws of the State of Maryland, without regard to its conflict of laws
provisions. Guarantor hereby submits itself to the non-exclusive jurisdiction
of the courts of the State of Maryland, United States of America, in any suit,
action, or proceeding arising, directly or indirectly, out of or relating to
this Guaranty; and so far as is permitted under applicable law, this consent to
personal jurisdiction will be self-operative. Unless specifically defined
herein, all capitalized terms used in this Guaranty will have the same meanings
set forth in the Agreement.

12.
GUARANTOR HEREBY ABSOLUTELY, IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY
JURY AND THE RIGHT TO CLAIM OR RECEIVE

68

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PUNITIVE
DAMAGES IN ANY LITIGATION, ACTION, CLAIM, SUIT OR PROCEEDING, AT LAW OR IN
EQUITY, ARISING OUT OF, PERTAINING TO OR IN ANY WAY ASSOCIATED WITH THE
COVENANTS, UNDERTAKINGS, REPRESENTATIONS OR WARRANTIES SET FORTH IN THIS
GUARANTY, THE RELATIONSHIPS OF THE PARTIES HERETO, WHETHER AS GUARANTOR OR
OTHERWISE, THE AGREEMENT OR ANY OTHER MARRIOTT AGREEMENT, OR ANY ACTIONS OR
OMISSIONS IN CONNECTION WITH ANY OF THE FOREGOING.

IN WITNESS
WHEREOF, the undersigned has executed this Guaranty, under seal, as of the date
first above written.



|                       |  |                             |  |       
|---------------------- |  | --------------------------- |  | ------
|                       |  | GUARANTOR:                 
|                       |  |                             | 
|ATTEST:                |  | APPLE TEN
HOSPITALITY, INC.
|                       |  |                             | 
|                       |  | By:                         |  | (SEAL)
|                       |  |                             |  |       
|(Assistant)
 Secretary |  | Name:                       | 
|                       |  | Title:                      | 



|                                  
|----------------------------------
|ADDRESS FOR
 NOTICES TO GUARANTOR:
|                                  
|814 East
 Main Street             
|Richmond, VA
 23219               

69

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MANAGEMENT COMPANY ACKNOWLEDGMENT

This
Management Company Acknowledgment (Management Company Acknowledgment) is
executed as of ___________________, 2011, by and among Newport Columbia
Management, LLC, a
[state] limited liability company (Management Company), Apple Ten Hospitality Management, Inc.,
a Virginia corporation (Franchisee), and Marriott International, Inc., a
Delaware corporation (Franchisor).

WHEREAS,
Management Company has entered into an agreement (Management Agreement) with
Franchisee, pursuant to which Management Company will operate that certain TownePlace Suites by Marriott hotel
located at 250 East Exchange Boulevard, Columbia, SC 29209 (the Hotel), in
accordance with the terms of that certain Relicensing Franchise Agreement dated
_________________, 2011 (as such agreement may be amended, supplemented,
restated or otherwise modified, the Franchise Agreement) between Franchisor
and Franchisee; and

WHEREAS,
Franchisee has requested that Franchisor consent to the operation of the Hotel
by Management Company in accordance with the Franchise Agreement.

NOW,
THEREFORE, in consideration of the mutual undertakings and benefits to be
derived herefrom, the receipt and sufficiency of which are acknowledged by each
of the parties hereto, it is hereby agreed as follows:

1. Franchisors
Consent. Subject
to and in accordance with the terms and conditions of this Management Company
Acknowledgment and the Franchise Agreement, Franchisor hereby consents to the
operation of the Hotel by Management Company and grants to Management Company
the right to operate the Hotel in accordance with the Standards and to use the
System, at, and only at, the Approved Location during the term of the Franchise
Agreement on behalf of Franchisee. Franchisors grant in the immediately
preceding sentence will terminate without notice to Management Company
contemporaneously with the occurrence of any of the following events:
(a) any termination of the Franchise Agreement, (b) the execution of
another management company acknowledgment among Franchisor, Franchisee and
another management company or (c) the execution of an amendment to the
Franchise Agreement consenting to the operation of the Hotel by Franchisee;
provided that the duties and obligations of Management Company that by their
nature or express language survive such termination, including Sections 3.b.
and c. below, will continue in full force and effect notwithstanding the
termination of Franchisors grant in the immediately preceding sentence.

2. Management
Company Representations and Covenants. Management Company represents and
warrants to Franchisor that:

a.
Management Company is not in control of or controlled by Persons who have been
convicted of any felony or a crime involving moral turpitude, or been convicted
of any other crime or offense or committed any acts, or engaged in any conduct
that is reasonably likely to have an adverse effect on the System, the
Proprietary Marks, the goodwill associated therewith, or Franchisors interests
therein;

b.
neither Management Company nor any Affiliate of Management Company is a
Competitor;

c.
the Management Agreement is valid, binding and enforceable; contains no terms,
conditions, or provisions that are, or through any act or omission of
Franchisee or Management Company,

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may be or may cause a breach of or default under the Franchise
Agreement; and is for a term of not less than ten (10) years; and

d.
neither Management Company nor any Affiliate of Management Company is a Person
with whom United States persons are prohibited from transacting business.

3. Management
Company and Franchisee Acknowledgments. Management Company and Franchisee
covenant and agree to the following:

a.
Management Company will have the exclusive authority and responsibility for the
day-to-day management of the Hotel on behalf of, and for the benefit of,
Franchisee with respect to and in accordance with the terms of the Franchise
Agreement. The general manager of the Hotel will be an employee of Management
Company and devote his or her full time and attention to the management and
operation of the Hotel and will have successfully completed Franchisors
management training program as required under the Franchise Agreement. The
general manager and other department managers of the Hotel will be employees of
the Management Company, while other staff at the Hotel may be employed by
Franchisee;

b.
The Hotel will be operated in strict compliance with the requirements of the
Franchise Agreement, and Management Company will observe fully and be bound by
all terms, conditions and restrictions regarding the management and operation
of the Hotel set forth in the Franchise Agreement, including those related to
Intellectual Property, as if and as though Management Company had executed the
Franchise Agreement as Franchisee, provided that Management Company obtains
no rights under the terms of the Franchise Agreement except as specifically set
forth herein and the rights granted hereunder do not constitute a franchise or
sub-franchise to Management Company. Management Company will comply with all
Applicable Laws, and will obtain in a timely manner all permits, certificates,
and licenses necessary for the full and proper operation of the Hotel;

c.
Franchisor may enforce directly against Management Company all terms in the
Franchise Agreement regarding Intellectual Property and the management and
operation of the Hotel during and subsequent to Management Companys tenure as
operator of the Hotel. Franchisor will have the right to seek and obtain all
available legal and equitable remedies from Management Company based on
Management Companys failure to comply with the terms of this Management
Company Acknowledgment, in addition to any remedies Franchisor may obtain from
Franchisee under the Franchise Agreement;

d.
Management Company hereby assigns (and will cause each of its employees or
independent contractors who contributed to such modifications, derivatives or
additions to assign) to Franchisor, in perpetuity throughout the world, all
rights, title and interest (including the entire copyright and all renewals,
reversions and extensions thereof) in and to all modifications, derivatives or
additions to the Intellectual Property and other aspects of the System proposed
by or on behalf of Management Company or its Affiliates. Management Company
waives (and will cause each of its employees or independent contractors who
contributed to such modifications, derivatives or additions to waive) all
moral rights of authors or any similar rights that Management Company (or its
employees or independent contractors) may now or hereafter have in the
modifications, derivatives or additions to the Intellectual Property and other
aspects of the System proposed by or on behalf of Management Company or its
Affiliates. Management Company agrees to execute (or cause to be executed) and
deliver to Franchisor any documents and to do any acts that may be deemed
necessary by Franchisor to perfect or protect the title in the modifications,
derivatives and additions herein conveyed, or intended to be conveyed now or in
the future;

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e.
Any default under the terms of the Franchise Agreement caused wholly or
partially by Management Company will constitute a default under the terms of
the Management Agreement, for which Franchisee will have the right to terminate
the Management Agreement;

f.
Franchisee and Management Company will not modify or amend the Management
Agreement in such a way as to create a conflict or other inconsistency with the
terms of the Franchise Agreement or this Management Company Acknowledgment;

g.
Except in extraordinary circumstances, such as theft or fraud on the part of
Management Company or a default by Franchisee under the Franchise Agreement
caused by Management Company for which Franchisee needs to promptly remove
Management Company from the Hotel, the Management Agreement will not be
terminated or permitted to expire without at least thirty (30) days prior
notice to Franchisor; and

h.
Management Company will perform the day-to-day operations of the Hotel.
Franchisor has the right to communicate directly with Management Company and
the managers at the Hotel regarding day-to-day operations of the Hotel and such
communications will be deemed made to Franchisee because Management Company and
the managers at the Hotel are acting on behalf of Franchisee and Management
Company as their authorized representatives. Franchisor has the right to rely
on instructions of Management Company and the managers at the Hotel as to
matters relating to the operation and promotion of the Hotel, and the agreements
of such managers are binding on Management Company and Franchisee.

4. Existence
and Power. Each of Management Company and Franchisee represents and
warrants with respect to itself that (i) it is a legal entity duly formed,
validly existing, and in good standing under the laws of the jurisdiction of
its formation, (ii) it has the ability to perform its obligations under this
Management Company Acknowledgment and under the Management Agreement, and (iii)
it has all necessary power and authority to execute and deliver this Management
Company Acknowledgment.

5. Authorization;
Contravention.

a.
Management Company and Franchisee each represents and warrants with respect to
itself that the execution and delivery of this Management Company
Acknowledgment and the performance by Management Company and Franchisee of its
respective obligations hereunder and under the Management Agreement: (i) have
been duly authorized by all necessary action; (ii) do not require the consent
of any third parties (including lenders) except for such consents as have been
properly obtained; and (iii) do not and will not contravene, violate, result in
a breach of, or constitute a default under (a) its certificate of formation,
operating agreement, articles of incorporation, by-laws, or other governing
documents, (b) any regulation of any governmental body or any decision, ruling,
order, or award by which each may be bound or affected, or (c) any agreement,
indenture or other instrument to which each is a party; and

b.
Management Company represents and warrants to Franchisor that: (i) neither
Management Company (including any and all of its directors and officers), nor
any of its Affiliates or the funding sources for any of the foregoing is a
Specially Designated National or Blocked Person (as defined in the Franchise
Agreement); (ii) neither Management Company nor any of its Affiliates is
directly or indirectly owned or controlled by the government of any country
that is subject to an embargo by the United States government; and (iii)
neither Management Company nor any of its Affiliates is acting on behalf of a
government of any country that is subject to such an embargo. Management
Company further represents and warrants that it is in compliance with any
applicable anti-money laundering law, including

72

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the USA Patriot Act. Management Company agrees that it will notify
Franchisor in writing immediately upon the occurrence of any event which would
render the foregoing representations and warranties of this Section 5.b.
incorrect.

6. Controlling
Agreement. If there are conflicts between any provision(s) of the Franchise
Agreement and this Management Company Acknowledgment on the one hand and the
Management Agreement on the other hand, the provision(s) of the Franchise
Agreement and this Management Company Acknowledgment will control.

7. No
Release. This Management Company Acknowledgment will not release or
discharge Franchisee from any liability or obligation under the Franchise
Agreement and Franchisee will remain liable and responsible for the full
performance and observance of all of the provisions, covenants, and conditions
set forth in the Franchise Agreement.

8. Limited
Consent. Franchisors consent to Management Company operating the Hotel and
Franchisors grant to Management Company of the right to operate the Hotel are
personal to Management Company, and this Management Company Acknowledgment is
not assignable by Franchisee or Management Company. If there is a change in
control of Management Company or if Management Company becomes, is acquired by,
comes under the control of, or merges with or into a Competitor, or if there is
a material adverse change to the financial status or operational capacity of
Management Company, Franchisee will promptly notify Franchisor of any such
change and Management Company will be subject to the consent process under the
Franchise Agreement as a new operator of the Hotel.

9. Defined
Terms. Unless specifically defined herein, all capitalized terms used in
this Management Company Acknowledgment will have the same meanings set forth in
the Franchise Agreement.

10. Counterparts.
This Management Company Acknowledgment may be executed in any number of
counterparts, each of which will be deemed an original, but all of which, when
taken together, will constitute one and the same instrument. Delivery of an
executed signature page to this Management Company Acknowledgment by facsimile
transmission will be effective as delivery of a manually signed counterpart of
this Management Company Acknowledgment.

11. Governing
Law. This Management Company Acknowledgment will be construed in accordance
with the laws of the State of Maryland without regard to the conflict of laws
principles thereof, and contains the entire agreement of the parties hereto.
Management Company hereby submits itself to the non-exclusive jurisdiction of
the courts of the State of Maryland, United States of America, in any suit, action,
or proceeding arising, directly or indirectly, out of or relating to this
Management Company Acknowledgment; and so far as is permitted under applicable
law, this consent to personal jurisdiction will be self-operative.

12.
Management Companys Address. Management Companys mailing address is
4290 New Town Avenue, Williamsburg, VA 23188. Management Company agrees to
provide notice to both Franchisee and Franchisor if there is any change in
Management Companys mailing address.

13.
WAIVER OF JURY TRIAL AND PUNITIVE DAMAGES. MANAGEMENT COMPANY,FRANCHISEE AND FRANCHISOR
EACH HEREBY ABSOLUTELY, IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY AND
THE RIGHT TO CLAIM OR RECEIVE PUNITIVE DAMAGES IN ANY LITIGATION, ACTION,
CLAIM, SUIT OR PROCEEDING, AT LAW OR IN EQUITY, ARISING OUT OF, PERTAINING TO
OR IN

73

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ANY WAY ASSOCIATED WITH THE COVENANTS, UNDERTAKINGS,
REPRESENTATIONS OR WARRANTIES SET FORTH HEREIN, THE RELATIONSHIPS OF THE
PARTIES HERETO, WHETHER AS MANAGEMENT COMPANY, FRANCHISEE OR FRANCHISOR
OR OTHERWISE, THIS AGREEMENT OR ANY OTHER MARRIOTT AGREEMENT, OR ANY ACTIONS OR
OMISSIONS IN CONNECTION WITH ANY OF THE FOREGOING.

IN WITNESS
WHEREOF, the parties hereto have duly executed and delivered this Management
Company Acknowledgment, under seal, as of the date first above written.

|                     |  |                               |  |       
|-------------------- |  | ----------------------------- |  | ------
|                     |  | FRANCHISOR:                  
|                     |  |                               | 
|ATTEST:              |  | MARRIOTT
 INTERNATIONAL, INC.
|                     |  |                               | 
|                     |  | By:                           |  | (SEAL)
|                     |  |                               |  |       
|Assistant
 Secretary |  | Name:                         | 
|                     |  | Title:                        | 

|                       |  |                       |  |       
|---------------------- |  | --------------------- |  | ------
|                       |  | FRANCHISEE:          
|                       |  |                       | 
|ATTEST:                |  | APPLE TEN
HOSPITALITY
|                       |  | MANAGEMENT,
INC.     
|                       |  |                       | 
|                       |  | By:                   |  | (SEAL)
|                       |  |                       |  |       
|(Assistant)
 Secretary |  | Name:                 | 
|                       |  | Title:                | 

|         |  |                                   |  |       
|-------- |  | --------------------------------- |  | ------
|         |  | MANAGEMENT
 COMPANY:             
|         |  |                                   | 
|WITNESS: |  | NEWPORT COLUMBIA
 MANAGEMENT, LLC
|         |  |                                   | 
|         |  | By:                               |  | (SEAL)
|         |  |                                   |  |       
|Witness  |  | Name:                             | 
|         |  | Title:                            | 

74

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ELECTRONIC SYSTEMS LICENSE AGREEMENT

This
Electronic Systems License Agreement (this License Agreement) is made and entered into effective
as of the ____ day of ___________________, 2011 (Effective Date), between
Marriott International, Inc., a Delaware corporation (Franchisor), and Apple Ten Hospitality Management, Inc.,
a Virginia corporation (Franchisee).

WITNESSETH:

WHEREAS,
Franchisor and Franchisee have entered into a Franchise Agreement dated as of
the date hereof (the Franchise Agreement) under which Franchisee will
establish and operate the Hotel under Franchisors System at the location
specified in the Franchise Agreement; and

WHEREAS,
under the terms of the Franchise Agreement, Franchisee is required to use
certain Electronic Systems in connection with, and as a condition of operating
the Hotel, and Franchisor desires to make available to Franchisee such
Electronic Systems under the terms of this License Agreement.

NOW,
THEREFORE, in consideration of the premises and the undertakings and
commitments of each party to the other party set forth herein, the parties
agree as follows:

1. Defined
Terms. Capitalized terms not defined in this License Agreement will have
the meaning given to them in the Franchise Agreement.

2. License
Grant. Subject to the terms of this License Agreement, Franchisor hereby
grants to Franchisee a nonexclusive, non-transferable right and license to use
the Electronic Systems made available by Franchisor. For each Electronic
System, the license will commence on the installation date thereof, and will
extend until termination of this License Agreement or such time as Franchisor
ceases to make such Electronic System available in accordance with Franchisors
operation of the System.

3. Ownership;
Use Restrictions. All Electronic Systems will at all times remain the sole
property of Franchisor or any third-party vendors, as applicable. Franchisee
will at all times treat the Electronic Systems as confidential. Franchisee will
not at any time, without Franchisors or such third partys prior consent
(which may be withheld in Franchisors or such third partys sole discretion),
copy, modify, reverse engineer, or otherwise duplicate the Electronic Systems
or any component thereof, in whole or in part, or otherwise make the same
available to any third party. Franchisee will use the Electronic Systems for
the exclusive purpose of operating the Hotel in accordance with the Franchise
Agreement. Franchisee will take reasonable measures to ensure that only
authorized employees of Franchisee at the Hotel have access to the Electronic
Systems, and only for permitted purposes hereunder. Such measures will be
subject to review and inspection by Franchisor. Franchisee will not attempt to
modify, delete or circumvent any measures used by Franchisor to safeguard the
Electronic Systems and the Intellectual Property therein. Franchisor reserves
the right to suspend Franchisees access to any Electronic System in order to
protect Franchisors Intellectual Property or other systems, data or property
of Franchisor or its vendors.

4. Third
Party Vendors; Preferred Vendors. If any Electronic System is provided by a
third party vendor, Franchisee will comply with the terms provided by such
vendors in connection therewith. Franchisee acknowledges and agrees that such
third party vendors will have the right to enforce such terms directly against
Franchisee, and Franchisor will have no liability in connection with
Franchisees use of any third party Electronic System. Franchisor may also
require Franchisee to execute license or similar agreements directly with such
third party vendors in order to obtain access to Electronic Systems that are
required under Franchisors System. Franchisee will be deemed to be in direct
privity of contract

---



with any third
party provider of Electronic Systems. From time to time Franchisor may
designate a third party vendor of Electronic Systems as a preferred vendor
based on Franchisors reasonable judgment that such third party Electronic
System is suitable or desirable for Franchisors System. Franchisee
acknowledges and agrees that Franchisor neither endorses nor makes any
representations or warranties in connection with any third partys Electronic
Systems, including any Electronic System provided by a preferred vendor.

5.
Support Services. Franchisor will use commercially reasonable efforts to
maintain and support the Electronic Systems (the Services) during the term of
this License Agreement either by itself or through third party vendors as
deemed appropriate by Franchisor.

6.
Term and Termination. This License Agreement will commence on
the Effective Date and remain in force until termination of the Franchise
Agreement.

7. DISCLAIMERS.FRANCHISEE ACKNOWLEDGES AND AGREES THAT, EXCEPT AS
EXPRESSLY SET FORTH IN THIS LICENSE AGREEMENT, FRANCHISOR PROVIDES THE
ELECTRONIC SYSTEMS AND ANY ASSOCIATED SERVICES ON AN AS-IS BASIS, AND
FRANCHISOR DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT
LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, CUSTOM OR USAGE IN THE TRADE, IN CONNECTION WITH FRANCHISEES USE OF
THE ELECTRONIC SYSTEMS AND THE PROVISION OF THE SERVICES UNDER THIS LICENSE
AGREEMENT.

8.
Limitation on Liability. Franchisor will not be liable for any damage
arising out of or in connection with the use or failure of any Electronic
Systems or Services, including, but not limited to, corruption of data, and
Franchisee hereby waives any right to or claim of any exemplary, incidental,
indirect, special, consequential, or other similar damages (including loss of profits)
in connection with the use or failure of Electronic Systems or Services, even
if Franchisor has been advised of the possibility of same. Franchisor will use
reasonable efforts, to the extent legally permissible, to pass through to
Franchisee any warranties or other similar protections provided to Franchisor
by Franchisors vendors with respect to Electronic Systems.

9.
Indemnification. Franchisee agrees to indemnify, defend and hold
harmless Franchisor and its respective officers, directors, employees, agents,
successors, and assigns, from any losses, fines, liabilities, damages and
claims, and all related costs and expenses, including reasonable legal fees,
disbursements and costs of investigation, litigation, settlement, judgment,
interest and penalties (collectively, Losses) incurred by Franchisor in
connection with Franchisees use of the Electronic Systems or any failure by
Franchisee to comply with the terms of this License Agreement. Such
indemnification and hold harmless obligations will be subject to and
incorporated into the Section of the Franchise Agreement delineating
Franchisees indemnification obligations.

10. Software
License Rights Upon Termination. Franchisee acknowledges and agrees that
most Software purchased by Franchisees through Franchisors procurement process
is purchased in Franchisors name, and is not assignable to Franchisee upon
termination of this License Agreement (Non-Assignable Software). As such,
upon termination of this License Agreement, Franchisees right to use such
Non-Assignable Software will automatically cease. With respect to software
purchased through Franchisors procurement process that is assignable to
Franchisee upon termination of this License Agreement (Assignable Software),
upon the request of Franchisee, Franchisor will provide reasonable assistance
in helping to facilitate assignment of such software, including obtaining
consent of the vendor where necessary. Upon termination of this License
Agreement, Franchisee will delete both Assignable Software and Non-Assignable
Software obtained through Franchisors procurement process

2

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and, with
respect to Assignable Software, Franchisee may reinstall such software on the
applicable computing equipment using software copies obtained by Franchisee
directly from the applicable vendor.

11.
Miscellaneous. All notices and other communications hereunder
will be in writing and will be delivered in accordance with the terms of the
Franchise Agreement. This License Agreement may not be modified or amended
except by an agreement in writing signed by the parties hereto. Waiver of any
provision hereof in one or more instances will not preclude enforcement thereof
on future occasions. This License Agreement may not be assigned by Franchisee
to any third party, except in connection with an assignment of the Franchise
Agreement as expressly permitted therein. This License Agreement and the legal
relations between the parties hereto will be governed by and construed in
accordance with the laws of the jurisdiction set forth in the Franchise
Agreement. This License Agreement constitutes the entire agreement among the
parties hereto with respect to the subject matter hereof, and supersedes all
other communications, whether written or oral.

12.
WAIVER OF JURY TRIAL AND PUNITIVE DAMAGES. FRANCHISEE AND FRANCHISOR
EACH HEREBY ABSOLUTELY, IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY AND
THE RIGHT TO CLAIM OR RECEIVE PUNITIVE DAMAGES IN ANY LITIGATION, ACTION,
CLAIM, SUIT OR PROCEEDING, AT LAW OR IN EQUITY, ARISING OUT OF, PERTAINING TO
OR IN ANY WAY ASSOCIATED WITH THE COVENANTS, UNDERTAKINGS, REPRESENTATIONS OR
WARRANTIES SET FORTH HEREIN, THE RELATIONSHIPS OF THE PARTIES HERETO, WHETHER
AS FRANCHISEE OR FRANCHISOR OR OTHERWISE, THIS AGREEMENT OR ANY OTHER
MARRIOTT AGREEMENT, OR ANY ACTIONS OR OMISSIONS IN CONNECTION WITH ANY OF THE
FOREGOING.

IN WITNESS
WHEREOF, the parties hereto have caused this License Agreement to be duly
executed and delivered, under seal, as of the date first above written.

|                      |                               |  |        |  | 
|--------------------- | ----------------------------- |  | ------ |  | 
|                      | FRANCHISOR:                  
|                      |                               |  |       
|ATTEST:               | MARRIOTT INTERNATIONAL, INC. 
|                      |                               |  |       
|                      | By:                           |  | (SEAL)
|                      |                               |  |        | 
|Assistant Secretary   | Name:   James C. Fisher      
|                      | Title:  Senior Vice President
|                      |                               |  |       
|                      | FRANCHISEE:                  
|                      |                               |  |       
|ATTEST:               | APPLE TEN HOSPITALITY        
|                      | MANAGEMENT, INC.             
|                      |                               |  |       
|                      | By:                           |  | (SEAL)
|                      |                               |  |        | 
|(Assistant) Secretary | Name:   Justin
 G. Knight    
|                      | Title:  President            

3

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OWNER AGREEMENT

This
AGREEMENT (Agreement) is entered into as of the ____ day of _________, 2011,
by and among Marriott International, Inc., a Delaware corporation
(Franchisor), Apple Ten Hospitality Management, Inc., a Virginia corporation
(Franchisee), and Apple Ten Business Trust, a Virginia trust (Owner).

W I T N E S S E T H:

WHEREAS,
Franchisor and Franchisee are parties to that certain Relicensing Franchise
Agreement dated as of __________, 2011 (as may be amended from time to time,
the Franchise Agreement) relating to the Hotel (as defined in the Franchise
Agreement); and

WHEREAS,
Franchisee and Owner have entered into a lease (the Lease) pursuant to which
Franchisee will lease the Hotel from Owner and will operate the Hotel; and

WHEREAS,
Owner, Franchisee and Franchisor desire that the Hotel be operated as a System
Hotel pursuant to the terms and conditions of the Franchise Agreement and this
Agreement.

NOW,
THEREFORE, the parties, in consideration of the premises and the undertakings
and commitments of each party set forth herein, agree as follows:

|   |                                        
|-- | ---------------------------------------
|1. | [Intentionally Omitted.]               
|   |                                        
|2. | Termination of the Franchise Agreement.

Franchisor
will have the right to terminate this Agreement immediately upon termination of
the Franchise Agreement by delivering written notice to Owner.

|   |                          
|-- | -------------------------
|3. | Termination of the Lease.

Owner will notify Franchisor immediately of
any pending or actual termination or expiration of the Lease that is to occur
or has occurred prior to expiration of the Franchise Agreement, and Franchisor
will have the right to terminate this Agreement and the Franchise Agreement in
connection with any such expiration or termination. If there is a dispute
between Owner and Franchisee relating to the termination of the Lease,
Franchisor will have the right to permit Franchisee to operate the Hotel
pursuant to the Franchise Agreement as long as Franchisee has possession of the
Hotel, and all of Franchisors rights under this Agreement will be reserved
pending resolution of such dispute whether by final court or administrative
order or negotiated settlement.

|   |                                     
|-- | ------------------------------------
|4. | Transfers Not Involving Competitors.

Section
17 of the Franchise Agreement will apply hereunder to any Transfer of the
Hotel, any Ownership Interest in the Hotel, the Owner, this Agreement or the
Lease, or a change of Control in Owner, Franchisee or Owner, as if Owner were a
party thereto; any such Transfer(s) by Owner as described above will be made
only in strict compliance with Section 17 as the context requires.

|   |                                                              
|-- | -------------------------------------------------------------
|5. | Transfers Involving a Competitor and Right of First
 Refusal.

A.
No Transfers to a Competitor. If there is a proposed Transfer to a
Competitor of the Hotel, any Ownership Interest in the Hotel, Owners Ownership
Interest in this Agreement or in the

---



Lease, or an
Ownership Interest in either Owner or a Control Affiliate of Owner, and Owner
wishes to accept such proposed Transfer, Owner will give notice thereof to
Franchisor, stating the full name and identity of the prospective purchaser or
tenant, as the case may be, including the names and addresses of the
Interestholders of such prospective purchaser or tenant, the price or rental
and all terms of such proposed transaction, together with all other related
information that is reasonably requested by Franchisor and reasonably available
to Owner. Within thirty (30) days after receipt by Franchisor of such notice
and information from Owner, Franchisor will notify Owner of Franchisors
election, made in its sole discretion, of one (1) of the immediately following
four (4) alternatives:

(1)
Acquisition of Control of Hotel for Cash. If the proposed Transfer is a sale or
lease of the Hotel for cash consideration, Franchisor (or its designee) will
have the right to purchase or lease the Hotel at the same price or rental and
upon the same terms (other than any terms relating to the Brand of the Hotel)
as those contained in such offer from (or to) a Competitor. In such event,
Owner and Franchisor (or its designee) will promptly enter into an agreement
for sale or lease at the price or rental and on terms consistent with such
offer.

(2)
Acquisition of Owner/Acquisition of Control of Hotel. If the proposed Transfer
is a purchase or lease of all or a portion of the Ownership Interests or the
assets (which includes the Hotel) of Owner or an Affiliate of Owner, or a
merger with or into Owner or an Affiliate of Owner, or the acquisition of
Owners Ownership Interest in this Agreement or the Lease, or any sale or lease
of the Hotel involving non-cash consideration, or other form of Transfer,
Franchisor (or its designee) will have the right to purchase or lease the Hotel
at the purchase or lease price under terms consistent with such offer as agreed
to by the parties. If the parties are unable to agree as to purchase or lease
price and terms within fourteen (14) days of Franchisors election, the
purchase or lease price of the Hotel will be determined as provided below.

(a)
Within thirty (30) days after the fourteen (14) day period in this Section
5.A.(2) expires, Franchisor and Owner will each obtain, at its own expense, an
appraisal of the fair market value of the Hotel from a nationally recognized
appraiser of Hotel properties comparable to the Hotel. In determining the fair
market value, the appraisers will assume that the Hotel is not subject to a
management agreement but is subject to the existing Franchise Agreement. If,
after receiving such appraisals, the parties agree on the fair market value of
the Hotel, such agreed fair market value will constitute the purchase or lease
price.

(b)
If, within fourteen (14) days after receiving the appraisals the parties are
not able to agree on such fair market value, the purchase or lease price will
be determined by baseball arbitration in Washington, D.C. in accordance with
the Arbitration Rules for the Real Estate Industry of the American Arbitration
Association then in effect (AAA Rules) as modified by this Agreement. The
parties will jointly select a third party to act as the sole arbitrator (the
Arbitrator) to determine the fair market value of the Hotel, and such
Arbitrator will be a person having at least ten (10) years recent professional
experience as to the subject matter in question and will be qualified to act as
an Arbitrator in accordance with the AAA Rules. If the parties do not agree on
an Arbitrator with such qualifications within fifteen (15) days after the
expiration of such fourteen (14) day period referred to above, the Arbitrator
will be appointed by the American Arbitration Association in Washington, D.C.
in accordance with the AAA Rules.

(c)
The Arbitrator will be instructed and obligated to decide, within thirty (30)
days after appointment, whether the appraisal submitted by Franchisor or the
appraisal submitted by Owner more accurately reflects the fair market value of
the Hotel based upon the appraisals submitted and such information as is
normally relied upon by an appraiser of hotels and real estate. Each party
agrees to fully cooperate and provide all information requested by the
Arbitrator related to the Arbitrators

2

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determination of
the fair market value of the Hotel. The Arbitrators choice of appraisal will
be in writing, will constitute the purchase price hereunder, and will be final,
conclusive and binding on the parties as an award under the AAA Rules, and
may be enforced by a court of competent jurisdiction. The expenses of the
arbitration will be borne equally by the parties to the arbitration. Franchisor
(or its designee) will have the right, at any time within thirty (30) days of
being notified in writing of the decision of the Arbitrator, to either (a)
purchase the Hotel premises and related property at the valuation determined by
the Arbitrator, or (b) terminate this Agreement pursuant to clause (3) below.

(3)
Termination of Owner Agreement and Franchise Agreement. Franchisor may place Owner and
Franchisee in default and terminate this Agreement and the Franchise Agreement,
respectively, in which event Owner and Franchisee will be obligated, jointly
and severally, to pay Franchisor the applicable liquidated
damages and otherwise comply with the obligations referenced in Section 9.B of
this Agreement.

(4)
Consent. Franchisor may consent to such Transfer, which consent will be on such
terms as Franchisor may require, in its sole discretion.

This
Section 5.A will survive termination of this Agreement for any reason if,
before such termination, any event specified in Section 5 occurs, as a result
of which Franchisor has exercised (or has the right to exercise) such right of
first refusal, notwithstanding Section 5.G.

B.
Affiliates. If a Competitor proposes to acquire all of the Ownership
Interests of an Affiliate of Owner and such Affiliate does not directly or
indirectly own, lease, or operate any hotels operating under a trade name owned
by Franchisor or any of its Affiliates, Franchisor will not have any right of
first refusal to purchase the Hotel or right to terminate this Agreement, as
provided above in Section 5.A. with respect to such Transfer.

C.
Foreclosure. If the Transfer to a Competitor is by foreclosure, judicial
or legal process, or any other means, Franchisor (or its designee) will have
the right to purchase the Hotel upon notice to Owner. If the parties are unable
to agree as to a purchase price and terms within thirty (30) days of
Franchisors notice, the fair market value of the Hotel premises and related
property will be determined by arbitration in accordance with Section 5.A.(2)
above. This provision will survive the termination of this Agreement and the
termination of the Franchise Agreement under Section 19.1 thereof in connection
with the Competitors actions under Section 17.4.C of the Franchise Agreement
or this Section 5.C.

D.
Owner Becomes a Competitor. If Owner or any of its Affiliates becomes a
Competitor, Owner will notify Franchisor in accordance with Section 5.A., and
provide all information reasonably requested by Franchisor related to becoming
a Competitor and requested thereby and provide the data required pursuant to
Section 5.A, or if Franchisor otherwise determines that Owner or any of its
Affiliates has become a Competitor, Franchisor will so notify Owner and
Franchisor will have the rights provided in Section 5.A., as if the Hotel were
subject to a non-cash offer from a third party except that Franchisor will have
thirty (30) days instead of fourteen (14) to agree on purchase terms.

E.
Right of First Refusal. In addition to the events specified in Section
5.A, Franchisor will have the rights set forth in Section 5.A. if any event
occurs granting Franchisor a right of first refusal under Section 17 of the
Franchise Agreement, and, in connection with such event, Owner fails to
terminate the Lease and enter into, or cause a Substitute Operator to enter into,
an Interim Franchise Agreement and/or a New Franchise Agreement, as applicable,
in accordance with this Agreement.

F.
Real Estate Rights. Owner acknowledges that Franchisors rights under
this Section 5 are real estate rights with respect to the Hotel. Franchisor is
entitled to file a record of such interest in and

3

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among the
appropriate real estate records of the jurisdiction in which the Hotel is
located, and Owner will cooperate as requested by Franchisor in such filing.
Such filing will indicate that Franchisors rights in real estate under Section
17.4 of the Franchise Agreement and Section 5 of this Agreement will be
subordinate only to the exercise of the rights of bona fide lenders under a
mortgage or security deed secured by the Hotel, only if and for so long as: (i)
the lender is not a Competitor or Affiliate of a Competitor; (ii) any such
mortgage or security deed is and remains validly recorded and in full force and
effect; and (iii) the indebtedness underlying such mortgage or security deed
complies with the requirements of Section 7 hereof. Owner agrees that damages
are not an adequate remedy if Owner breaches its obligations under this Section
5 and that Franchisor will be entitled to injunctive relief to prevent or
remedy such breach without the necessity of proving the inadequacy of money
damages as a remedy and without the necessity of posting a bond. If this
Agreement is terminated and Owners rights under this Section 5 are no longer
in effect, at the request of Owner or the transferee, Franchisor will deliver
an instrument in recordable form to terminate any such recording of interest in
real estate.

G.
Survival of Right of First Refusal. Except for termination of this
Agreement pursuant to Section 5.A.(3) above, Owner agrees that Franchisors
rights under Section 5 will survive early termination of this Agreement (as
opposed to expiration of this Agreement as provided in Section 12 hereof) and
will bind Owner and its Affiliates, if the events in either Section 5.G.(1) or
Section 5.G.(2) occur:

(1)
before or within six (6) months after termination of this Agreement, a proposed
Transfer to a Competitor occurs with respect to the Hotel, Owner or an
Affiliate, or an Ownership Interest in either Owner or such Affiliate; and

(a)
the Franchise Agreement is terminated under (x) Sections 19.1.K or L; or (y)
Section 19.2.B; or (z) Section 19.2.D based upon a violation of Section 13.2;
or

(b)
the Franchise Agreement is terminated under Section 19.1.A, B, C, D or E and an
Affiliate, principal, or director of Owner obtains possession of the Hotel, or
such Affiliate, principal, or director is the party filing the suit or seeking
the execution or foreclosure referenced in Section 19.1.

(2)
there is a purported early termination of this Agreement (as opposed to
expiration of this Agreement as provided in Section 12 of this Agreement) by
Owner and before or within six (6) months after such purported
termination, a proposed Transfer to a Competitor occurs with respect to the
Hotel, the Owner or an Affiliate of Owner, or an Ownership Interest in either
Owner or such Affiliate.

|   |                         
|-- | ------------------------
|6. | [Intentionally Omitted.]
|   |                         
|7. | Financing of the Hotel. 

Owner
will not, and will cause each Interestholder in Owner to not, incur or replace
any indebtedness that is secured by a lien on or mortgage of the Hotel or
pledge of Ownership Interests in Owner (whether such indebtedness is incurred
(i) individually on behalf of the Hotel or (ii) on a pooled basis with other
hotels or legal entities (a Financed Pool)) unless the following conditions
are met at the time the indebtedness is incurred or replaced: (1) the terms of
such indebtedness are commercially reasonable; (2) the debt coverage ratio is
equal to or greater than 1.3; and (3) the lender is not a Competitor or an
Affiliate of a Competitor. The condition set forth in clause (2) of the
immediately preceding sentence will not apply to indebtedness incurred prior to
the third anniversary of the Opening Date to finance the construction of the
Hotel (or the conversion of such construction financing to permanent financing,
if such permanent financing is obtained at the same closing as the construction

4

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financing). The
debt coverage ratio as of any calculation date is the ratio of: (a) cash
available for the payment of debt service (interest and principal) for the
Hotel (or hotels, including the Hotel, that are part of the Financed Pool) from
Gross Revenues (after deduction for any management fee or reserve required
under the Franchise Agreement, any management agreement, or under the terms of
any financing) of the Hotel (or hotels, including the Hotel, that are part of
the Financed Pool) for the twelve (12) months immediately preceding such
calculation date, to (b) the greater of (x) the actual contractual amount of
debt service payments required to be made during the twelve (12) month period
after the calculation date for the Hotel (or hotels, including the Hotel, that
are part of the Financed Pool) or (y) the amount of debt service payments that
would be required to be made during the twelve (12) month period after the
calculation date for the Hotel (or hotels, including the Hotel, that are part
of the Financed Pool) assuming the indebtedness bears interest at an interest
rate of 7.5% and has a 20-year mortgage-style principal amortization. Owner
will give notice to Franchisor of the component hotels and legal entities in a
Financed Pool before incurring such indebtedness.

|   |                        
|-- | -----------------------
|8. | Operation of the Hotel.

The
Hotel will be operated as a System Hotel for the term hereof. Owner shall cause
Franchisee to operate the Hotel in accordance with the terms of the Franchise
Agreement. Failure of Owner to comply with the provisions of this Section 8
will be a material default by Owner hereunder giving Franchisor the right to
terminate this Agreement and the Franchise Agreement.

|   |                                                   
|-- | --------------------------------------------------
|9. | Owners Obligations under the Franchise Agreement.

A.
Franchisee Default. If Franchisor declares Franchisee to be in default
under the Franchise Agreement, Franchisor may (after providing the notice and
applicable cure period, if any, required in Section 1 above) enforce the
Franchise Agreement directly against Owner as if Owner were the Franchisee
under the Franchise Agreement, and Owner will perform, or cause to be
performed, the provisions of the Franchise Agreement including, without
limitation, Section 3 on fees, Section 9 on operations of the Hotel, Section 11.2
on the Reserve, and Section 16 on indemnification and insurance.

B.
Termination of Franchise Agreement. If the Franchise Agreement is
terminated and Franchisee fails to perform any post-termination obligation
under the Franchise Agreement, Franchisor may enforce the Franchise Agreement
directly against Owner as if Owner were the Franchisee under the Franchise
Agreement, and Owner will perform, or cause to be performed, all
post-termination obligations of Franchisee under the Franchise Agreement,
including, without limitation, Section 16.1 on indemnification, Section 19.3 on
liquidated damages, Section 20.1.A. on de-identifying the Hotel as part of the
System and cessation of the use of the System and Proprietary Marks, and
Section 20.1.B. on paying other costs and amounts.

|    |                         
|--- | ------------------------
|10. | Provisions of the Lease.

Any
lease governing the lease and operation of the Hotel (including the Lease) will
include the substance of the immediately following provisions or such other
provisions and requirements as set forth in the Franchise Agreement or in
Franchisors then-current disclosure document.

A.
Franchisee will have exclusive possession of the Hotel and exclusive control of
the day-to-day operations of the Hotel;

B.
The Hotel will be operated in full compliance with the provisions of the Franchise
Agreement. The Franchise Agreement will control in case of conflict with the
lease;

5

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C.
A default by Franchisee under the terms of the Franchise Agreement will
constitute a default under the terms of the lease;

D.
In the event of an uncured default caused by Franchisee that leads to
termination of the Franchise Agreement, the lease will be terminated; and

E.
The provisions in the lease that reflect this Section 10 and any other
provisions in the lease affecting, or for the benefit of, Franchisor will not
be amended or modified without Franchisors prior written consent.

11.     Surrender
by Franchisee.

Upon
the occurrence of the events described herein for the replacement of Franchisee
as possessor and operator of the Hotel, Franchisee will surrender its rights
and interest in the Franchise Agreement to Franchisor and peaceably turn over
possession of the Hotel to Owner without need for legal or judicial process.

12.     Term.

The
term of this Agreement will commence on the date first set forth above and will
expire upon the expiration of the term of the Franchise Agreement unless this
Agreement is terminated prior thereto in accordance with this Agreement. If the
term of the Franchise Agreement is renewed or otherwise extended, the term of
this Agreement automatically will be extended to be coterminous with the
extended term of the Franchise Agreement.

13.     Survival.

Notwithstanding
any provision to the contrary contained herein, Sections 9, 16 and 17 of this
Agreement will survive and remain in full force and effect after termination or
expiration of this Agreement for any reason, and Sections 5 and 14 will survive
the termination or expiration of this Agreement for any reason to the extent
provided in such Sections.

14.     Casualty.

If
the Hotel is damaged or destroyed by fire or other cause and such damage or
destruction is substantial and material, affecting over fifty percent (50%) of
the Hotel, and necessitates the closing of the Hotel for a period in excess of
ninety (90) days, Owner will have the right to terminate this Agreement and to
cause the Franchise Agreement to be terminated upon notice to Franchisor given
within ninety (90) days of such closing of the Hotel if it elects not to repair
or rebuild the Hotel. Owner and Franchisee will not be required to pay
Franchisor the liquidated damages due under Section 19.3 of the Franchise
Agreement in connection with such termination if such casualty is the sole
basis for termination of this Agreement and Owner and Franchisee execute and
deliver to Franchisor a termination agreement and release in form and substance
acceptable to Franchisor; provided, however, if subsequent to such notice and
before the date on which the Term of the Franchise Agreement would otherwise
have ended under Section 4 of the Franchise Agreement if such notice of
termination had not been given (the Term Expiration Date), Owner, or any of
its Affiliates or Interestholder with an Ownership Interest of twenty-percent
(20%) or greater (the Owner Entity) operates a hotel; vacation, timesharing,
interval or fractional ownership facility; condominium; apartment; or other
lodging product at the Approved Location (the Other Lodging Product), which
Other Lodging Product is not operated under a license or franchise from
Franchisor or one of its Affiliates, then in such event, Owner will be
obligated to promptly pay to Franchisor an amount equal to the applicable
liquidated damages set forth in Section 19.3 of the

6

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Franchise
Agreement, but clause (ii) in the calculation of liquidated damages will be the
lesser of (a) thirty-six (36) or (b) one-half (1⁄2) the number of months
then remaining between (x) the date on which the Other Lodging Product is first
operated by or for the Owner Entity or Franchisee Entity, and (y) the Term
Expiration Date. Owners obligations set forth in this Section 14 will survive
termination of this Agreement. If the Hotel does not close for ninety (90) days
or the Owner does not elect to terminate this Agreement in accordance with the
provisions of this Section 14, the Hotel will be promptly renovated and
reopened within a reasonable time in accordance with the System and pursuant to
plans and specifications approved by Franchisor in accordance with Section 6.2
of the Franchise Agreement.

|    |              
|--- | -------------
|15. | Condemnation.

Owner
will, at the earliest possible time, give Franchisor notice of any proposed
taking of the Hotel by eminent domain, condemnation, compulsory acquisition, or
similar proceeding. If such taking is substantial enough to render impractical
the continued operation of the Hotel in accordance with the System and guest
expectations, this Agreement will terminate upon notice by Franchisor, Owner,
or Franchisee to the other parties and the execution and delivery of a
termination agreement and release in form and substance acceptable to
Franchisor (and the Franchise Agreement will terminate upon notice by
Franchisor or Franchisee to the other party and the execution and delivery of a
termination agreement and release in form and substance acceptable to Franchisor),
and Franchisor will share equitably in the condemnation award; provided,
however, Franchisors portion of such award will be limited to compensating
Franchisor for Franchisors lost Franchise Fees, which amount will not exceed
the amount of the applicable liquidated damages due under Section 19.3 of the
Franchise Agreement. Further, if such condemnation is the sole basis for
termination of this Agreement and the Franchise Agreement, Franchisors portion
of such award will be in lieu of payment of the applicable liquidated damages
due under Section 19.3 of the Franchise Agreement. If such taking, in
Franchisors opinion, will not render the continued operation of the Hotel
impractical, Owner must promptly make whatever repairs and restorations are necessary
to make the Hotel conform substantially to its condition, character, and
appearance immediately before such taking, according to plans and
specifications approved by Franchisor. Owner will take all measures necessary
to ensure that the resumption of normal operation of the Hotel is not
unreasonably delayed.

|    |         
|--- | --------
|16. | Notices.

A.
Subject to Section 16.B., all notices, requests, demands, statements, and other
communications required or permitted to be given under the terms of this
Agreement will be in writing and delivered by hand against receipt, sent by
certified mail (postage prepaid and return receipt requested), or carried by
reputable overnight courier service, to the respective party at the following
addresses:

| |                 |                                                    
| | --------------- | ---------------------------------------------------
| | To Franchisor:  | Marriott
 International, Inc.                      
| |                 | 10400 Fernwood
 Road                               
| |                 | Bethesda, MD 20817                                 
| |                 | Attn: Law
 Department 52/923.25                    
| |                 |                                                    
| | With a copy to: | Marriott
 International, Inc.                      
| |                 | 10400 Fernwood
 Road                               
| |                 | Bethesda, MD 20817                                 
| |                 | Attn: Vice
 President, Owner and Franchise Services

7

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| |                |                                        
| | -------------- | ---------------------------------------
| | To Franchisee: | Apple Ten
 Hospitality Management, Inc.
| |                | 814 East Main
 Street                  
| |                | Richmond, VA 23219                     
| |                | Attn: Krissy
 Gathright, Vice President
| |                | Email: kgathright@applereit.com        
| |                |                                        
| | To Owner:      | Apple Ten Business
 Trust              
| |                | 814 East Main
 Street                  
| |                | Richmond, VA 23219                     
| |                | Attn: Krissy
 Gathright, Vice President
| |                | Email: kgathright@applereit.com        

or at such other
address as designated by notice from the respective party to the other parties.
Any such notice or communication will be deemed to have been given at the date
and time of: (A) receipt or first refusal of delivery, if sent via certified
mail or delivered by hand; or (B) one day after the posting thereof, if sent
via reputable overnight courier service.

B.
Franchisor may provide Franchisee and Owner with routine information, invoices,
the Standards and other System requirements and programs, such as the Quality
Assurance Program, including any modifications thereto, by regular mail or by
e-mail, facsimile, or by making such information available to Franchisee and
Owner on the Internet, an extranet, or other electronic means.

|    |                        
|--- | -----------------------
|17. | Successors and Assigns.

Franchisor
will have the right to Transfer this Agreement to any Person without prior
notice to, or consent of, Owner or Franchisee, provided the transferee assumes
Franchisors obligations to Owner and Franchisee under this Agreement. Owner
and Franchisee hereby acknowledge and agree that any such Transfer will
constitute a release and novation of Franchisor with respect to this Agreement.
This Agreement may not be assigned by Owner or Franchisee without the consent
of Franchisor.

|    |               
|--- | --------------
|18. | Governing Law.

This
Agreement is executed pursuant to, and will be interpreted and construed under
and governed exclusively by, the laws of the State of Maryland, United States
of America, which laws will prevail in the event of any conflict of law. Each
party hereby expressly and irrevocably submits itself to the non-exclusive
jurisdiction of the courts of the State of Maryland, United States of America,
in any suit, action, or proceeding arising, directly or indirectly, out of or
relating to this Agreement; and so far as is permitted under applicable law,
this consent to personal jurisdiction will be self-operative. Nothing in this
Section 18 is intended, or will be deemed, to make the Maryland Franchise
Registration and Disclosure Law apply to this Agreement, or the transactions or
relationships contemplated hereby, if such law otherwise would not be
applicable.

|    |                                         
|--- | ----------------------------------------
|19. | Hotel Ownership and Ownership Structure.

A.
Owner represents, warrants, and covenants to Franchisor that (i) Owner is the
sole owner of the Hotel and holds good and marketable fee title to the Approved
Location of the Hotel; and (ii) Owner is owned directly and indirectly as set
forth on Attachment A. Upon the request of Franchisor, Owner will submit to
Franchisor evidence, in form and substance satisfactory to Franchisor,
confirming that Owner is owned directly and indirectly as set forth on
Attachment A.

8

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B.
Owner represents, warrants, and covenants to Franchisor that: (i) neither Owner
(including any and all of its directors and officers), nor any of its
Affiliates or the funding sources for any of the foregoing is a Specially
Designated National or Blocked Person; (ii) neither Owner nor any of its
Affiliates is directly or indirectly owned or controlled by the government of
any country that is subject to an embargo by the United States government; and
(iii) neither Owner nor any of its Affiliates is acting on behalf of a
government of any country that is subject to such an embargo. Owner further
represents and warrants that it is in compliance with any applicable anti-money
laundering law, including the USA Patriot Act. Owner agrees that it will notify
Franchisor in writing immediately upon the occurrence of any event that would
render the foregoing representations and warranties of this Section 19.B.
incorrect.

|    |                                
|--- | -------------------------------
|20. | Entire Agreement; Counterparts.

A.
This Agreement, including the attachments hereto, and the agreements executed
simultaneously herewith, or pursuant to, or in connection with, this Agreement
(including, without limitation, the Franchise Agreement), contains the entire
agreement between the parties hereto as it relates to the Hotel as of the date
hereof. The Franchise Agreement is attached hereto as Attachment C; Owner
hereby acknowledges that it has read and fully understands Attachment B as it
applies hereunder.

B.
This Agreement may be executed in a number of identical counterparts, each of
which will be deemed an original for all purposes and all of which will
constitute, collectively, one agreement. Delivery of an executed signature page
to this Agreement by facsimile transmission will be effective as delivery of a
manually signed counterpart of this Agreement. This is a fully integrated
agreement. No agreement of any kind relating to the matters covered by this
Agreement will be binding upon any party unless and until the same has been
made in a written, non-electronic instrument that has been duly executed by the
non-electronic signature of all interested parties. This Agreement may not be
amended or modified by conduct manifesting assent, or by electronic signature,
and each party is hereby put on notice that any individual purporting to amend
or modify this Agreement by conduct manifesting assent or by electronic
signature is not authorized to do so.

|    |                    
|--- | -------------------
|21. | Effects of Waivers.

No
waiver, delay, omission, or forbearance on the part of Franchisor or Owner to
exercise any right, option or power arising from any default or breach by the
other party, or to insist upon strict compliance by the other party with any
obligation or condition hereunder, will affect or impair the rights of
Franchisor or Owner, respectively, with respect to any such default or breach
or subsequent default or breach of the same or of a different kind. Any delay,
forbearance, or omission of either party to exercise any right arising from any
such default or breach will not affect or impair such partys rights with
respect to such default or breach or any future default or breach. Franchisor
will not be liable to Owner for providing (or denying) any waiver, approval,
consent, or suggestion to Owner in connection with this Agreement or by reason
of any delay or denial of any request.

|    |                               
|--- | ------------------------------
|22. | Construction and Severability.

A.
Except as expressly provided to the contrary herein, each section, part, term
and/or provision of this Agreement will be considered severable; and if, for
any reason any section, part, term of provision herein is determined to be
invalid and contrary to, or in conflict with, any existing or future law or
regulation by a court or agency having valid jurisdiction, such will not impair
the operation of, or have any other effect upon, such other sections, parts,
terms and provisions of this Agreement as may remain otherwise intelligible,
and the latter will continue to be given full force and effect and bind the
parties hereto. To the extent possible, such invalid or unenforceable sections,
parts, terms or provisions will be

9

---



deemed to be
replaced with a provision that is valid and enforceable and most nearly
reflects the original intent of the invalid or unenforceable provision.

B.
Nothing in this Agreement is intended, or will be deemed, to create any third
party beneficiary or confer any rights or remedies under or by reason of this
Agreement upon any Person other than Franchisor (and its Affiliates),
Franchisee, or Owner, and their respective permitted successors and assigns.

|    |          
|--- | ---------
|23. | Captions.

Captions
and section headings are used for convenience only. They are not part of this
Agreement and will not be used in construing it.

|    |                                                 
|--- | ------------------------------------------------
|24. | Owner Representations, Warranties and Covenants.

Owner
represents, warrants and covenants that (i) it is a legal entity duly formed,
validly existing, and in good standing under the laws of the jurisdiction of
its formation, (ii) it and its Affiliates have and will continue to have
throughout the term hereof the ability to perform their obligations under this
Agreement, (iii) it has all necessary power and authority to execute and
deliver this Agreement, (iv) it has read and fully understands the Franchise
Agreement as it applies hereunder, and (v) during the term of the Franchise
Agreement it will not enter into an agreement for the management of the Hotel
that does not comply with the provisions of the Franchise Agreement, unless
otherwise approved by Franchisor.

|    |                     
|--- | --------------------
|25. | Cost of Enforcement.

If
for any reason it becomes necessary for Franchisor or Owner to initiate any
legal or equitable action to secure or protect its rights under this Agreement,
the prevailing party will be entitled to recover all costs incurred by it in
successfully enforcing such rights, including reasonable attorneys fees.

|    |                   
|--- | ------------------
|26. | Capitalized Terms.

Unless
the context requires otherwise, capitalized terms not defined herein will have
the meaning stated in the Franchise Agreement.

|    |                                           
|--- | ------------------------------------------
|27. | WAIVER OF JURY TRIAL AND PUNITIVE DAMAGES.

OWNER,
FRANCHISEE AND FRANCHISOR EACH HEREBY ABSOLUTELY, IRREVOCABLY AND
UNCONDITIONALLY WAIVE TRIAL BY JURY AND THE RIGHT TO CLAIM OR RECEIVE PUNITIVE
DAMAGES IN ANY LITIGATION, ACTION, CLAIM, SUIT OR PROCEEDING, AT LAW OR IN
EQUITY, ARISING OUT OF, PERTAINING TO OR IN ANY WAY ASSOCIATED WITH THE
COVENANTS, UNDERTAKINGS, REPRESENTATIONS OR WARRANTIES SET FORTH HEREIN, THE
RELATIONSHIPS OF THE PARTIES HERETO, WHETHER AS OWNER, FRANCHISEE, OR
FRANCHISOR OR OTHERWISE, THIS AGREEMENT OR ANY OTHER MARRIOTT AGREEMENT, OR
ANY ACTIONS OR OMISSIONS IN CONNECTION WITH ANY OF THE FOREGOING.

10

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IN
WITNESS WHEREOF, the parties have caused their duly authorized representatives
to execute this Owner Agreement, under seal, as of the date first above
written.

|                       |                                         |     |  |        | 
|---------------------- | --------------------------------------- | --- |  | ------ | 
|                       | FRANCHISOR:                            
|                       |                                         |     | 
|ATTEST:                | MARRIOTT
 INTERNATIONAL, INC.          
|                       |                                         |     | 
|                       |                                         | By: |  | (SEAL)
|                       |                                         |     |  |       
|Assistant
 Secretary   | Name:                                   |    
|                       | Title:                                  |    
|                       |                                         |    
|                       | FRANCHISEE:                            
|                       |                                         |     | 
|ATTEST:                | APPLE TEN
 HOSPITALITY MANAGEMENT, INC.
|                       | a Virginia corporation                 
|                       |                                         |     | 
|                       |                                         | By: |  | (SEAL)
|                       |                                         |     |  |       
|(Assistant)
 Secretary | Name:                                   |    
|                       | Title:                                  |    
|                       |                                         |     | 
|                       |                                         |     | 
|                       | OWNER:                                 
|                       |                                         |     | 
|WITNESS:               | APPLE TEN BUSINESS
 TRUST              
|                       | a Virginia trust                       
|                       |                                         |     | 
|                       |                                         | By: |  | (SEAL)
|                       |                                         |     |  |       
|Witness                | Name:                                   |    
|                       | Title:                                  |    

11

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ATTACHMENT A

Equity
Interest(s) in Owner

|                                                   |           
|-------------------------------------------------- | ----------
|Ownership of Apple Ten Business Trust              | % Interest
|                                                  
|Apple Ten Hospitality Ownership, Inc.              | 100%      
|814 East
 Main Street                              |           
|Richmond,
 VA 23219                                |           
|                                                  
|Ownership of Apple Ten Hospitality Ownership, Inc. | % Interest
|                                                  
|Apple Ten Hospitality Management, Inc.             | 100%      
|814 East
 Main Street                              |           
|Richmond,
 VA 23219                                |           
|                                                  
|Ownership of Apple Ten Hospitality, Inc.           | % Interest
|                                                  
|Apple REIT Ten, Inc.                               | 100%      
|814 East
 Main Street                              |           
|Richmond,
 VA 23219                                |           
|                                                  
|Ownership of Apple REIT Ten, Inc.                  | % Interest
|                                                  
|Publicly-Held Company                              | 100%      

12

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ATTACHMENT B

FRANCHISE AGREEMENT

13

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