EXHIBIT 10.1
**TERMINATION AGREEMENT**
     THIS TERMINATION AGREEMENT (this “Agreement”) is entered into as of this1st day of July, 2004 (the “Termination Date”) by and among MeriStarHospitality Corporation, a Maryland corporation (“MSH”), MeriStar HospitalityOperating Partnership, L.P., a Delaware limited partnership (“MSH OP”),MeriStar Hotel Lessee, Inc., a Delaware corporation (“Leasing” and, togetherwith MSH and MSH OP, the “MSH Parties”), Interstate Hotels & Resorts, Inc., aDelaware corporation and formerly known as MeriStar Hotels & Resorts, Inc.(“OPCO”) and Interstate Operating Company, L.P., a Delaware limited partnershipand formerly known as MeriStar H&R Operating Company, L.P. (“OPCO OP” and,together with OPCO, the “OPCO Parties”).
RECITALS:
     WHEREAS, MSH, MSH OP and the OPCO Parties entered into that certainIntercompany Agreement, dated as of August 3, 1998, as amended January 1, 2001and April, 2003 (the “Intercompany Agreement”);
     WHEREAS, the Board of Directors of each of MSH and OPCO have determinedthat it is in the best interests of their respective corporations, and theirrespective shareholders, to terminate the Intercompany Agreement in light ofthe current relationship between the corporations contemporaneously withamending certain provisions of other agreements among the parties and theirrespective affiliates.
     NOW, THEREFORE, for the mutual covenants and consideration hereincontained and for other good and valuable consideration, the receipt andsufficiency of which are hereby acknowledged, the parties hereto agree asfollows:
     1. Defined Terms. Any capitalized term not specifically defined in thisAgreement shall have the definition given such term in the IntercompanyAgreement.
     2. Date of Termination. The Intercompany Agreement shall terminateeffective as of the Termination Date and the parties shall have no furtherobligations thereunder. In addition, each of the parties fully releases anddischarges the other from and against any and all claims, damages, liabilities,costs or expenses arising out of, or relating to, the Intercompany Agreement orthe termination hereof.
     3. Construction. Each party hereby acknowledges that it has participatedequally in the drafting of this Agreement, with assistance of counsel, andtherefore that no court construing this Agreement should construe it morestringently against one party than the other.
     4. Cumulative Remedies. All rights, benefits and remedies provided to theparties by this Agreement, or any instruments or documents executed pursuant tothis Agreement, are cumulative and shall not be exclusive of any other of therights, remedies and benefits allowed by law or equity to the parties.
 

 

     5. Governing Law. This Agreement shall be governed by, and construedunder, the laws of the State of New York without regard to conflicts of lawprinciples thereof.
     6. Invalid Provisions. If any provision of this Agreement is held to beillegal, invalid or unenforceable under present or future laws in effect fromtime to time, such provision shall be fully severable; this Agreement shall beconstrued and enforced as if the illegal, invalid or unenforceable provisionhad never comprised a part hereof; and the remaining provisions hereof shallremain in full force and effect and shall not be affected by the illegal,invalid or unenforceable provision or by its severance herefrom.
     7. Multiple Counterparts and Facsimile Signature. This Agreement may beexecuted in identical counterparts, each of which shall be deemed an originalfor all purposes and all of which shall constitute, collectively, oneAgreement. This Agreement may be executed by facsimile signature provided thatan original of this Agreement is delivered by overnight courier promptlythereafter.
     8. Authority. Each of the parties hereto represents and warrants that itis duly authorized to execute and deliver this Agreement in accordance with itsorganizational and governing documents, including, as applicable, its corporatecharter, corporate bylaws, limited liability company agreement or articles oforganization and/or partnership agreement and that this Agreement is bindingupon such party in accordance with its terms.
     9. Binding Effect. This Agreement shall be binding upon and inure to thebenefit of the parties hereto, and their respective successors and permittedassigns.
[Signatures appear on the following page.]
2

 

     IN WITNESS WHEREOF, the parties have executed this Termination Agreementas of the date first above written.         MERISTAR HOSPITALITY CORPORATION        By:          Name:          Title:                  MERISTAR HOSPITALITY OPERATING PARTNERSHIP, L.P.         By: Meristar Hospitality Corporation, its general partner        By:          Name:          Title:                  MERISTAR HOTEL LESSEE, INC.        By:          Name:          Title:                  INTERSTATE HOTELS & RESORTS, INC.        By:          Name:          Title:                  INTERSTATE OPERATING COMPANY, L.P.         By: Interstate Hotels & Resorts, Inc.          By:           Name:           Title:        
3