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                                                                  Exhibit 10.7

                              FIRST AMENDMENT TO
                         REGISTRATION RIGHTS AGREEMENT

                  THIS FIRST AMENDMENT TO REGISTRATION RIGHTS AGREEMENT
(sometimes herein this "Amendment") is made and entered into as of the 10th day
of October, 1996, by and between SHOLODGE, INC., a Tennessee corporation with
its principal place of business at 217 West Main Street, Gallatin, Tennessee
37066 (hereinafter referred to as the "Company"), and RICHARD L. JOHNSON, a
resident of the State of Tennessee (hereinafter referred to as "Johnson").

                              W I T N E S S E T H:

                  WHEREAS, the Company and Johnson entered into that certain
Registration Rights Agreement (hereinafter referred to as the "Agreement")
dated as of December 11, 1991; and

                  WHEREAS, the Company and Johnson now desire to amend certain
provisions of the Agreement as set forth herein.

                  NOW, THEREFORE, for and in consideration of the mutual
promises and covenants herein contained, the parties do hereby agree as
follows:

                  1. The definition of "Stock Option Agreement" in paragraph 1 
of the Agreement is hereby deleted in its entirety and the following is hereby
inserted in its place:

                           "Stock Option Agreement" means that certain Amended
                  and Restated Stock Option Agreement dated March 9, 1992, but
                  effective as of April 1, 1984, as amended by that certain
                  First Amendment to Amended and Restated Stock Option
                  Agreement dated as of October 10, 1996, both between Leon
                  Moore and Johnson.

                  2. Paragraph 2(a) of the Agreement is hereby amended by 
changing the date "December 11, 1996" in the first sentence thereof to
"December 11, 1997".

                  3. Paragraph 2(b) of the Agreement is hereby deleted in its 
entirety and the following is hereby inserted in its place:

                           (b) The Company shall be obligated to prepare, file
                  and cause to become effective only two (2) registration
                  statements pursuant to this Section 2; provided, however,
                  that the Company shall not be obligated to prepare, file and
                  cause to become effective a registration statement unless the
                  aggregate market value of the Registrable Securities to be
                  registered thereby is at least One Million Dollars
                  ($1,000,000).

                  4. Paragraph 3(a) of the Agreement is hereby amended by 
changing the date "December 11, 1996" in the first sentence thereof to
"December 11, 1997".

                                                      


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                  5. Paragraph 9(b) of the Agreement is hereby ameded by
changing the street address for Patrick L. Alexander as set forth therein from
"222 Third Avenue North" to "414 Union Street, Suite 1600".

                  6. Except as hereby modified and amended, the Agreement shall
in all other respects remain in full force and effect.

                  IN WITNESS WHEREOF, the parties have executed this First
Amendment to Registration Rights Agreement on the day and year first above
written.

                                       SHOLODGE, INC.

                                       By: /s/ Leon Moore
                                           ----------------------------------
                                       Title: President
                                              -------------------------------

                                       /s/ Richard L. Johnson
                                       --------------------------------------   
                                       RICHARD L. JOHNSON




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