<PAGE>   1
                                                                 EXHIBIT 10.(40)


                           SALE AND PURCHASE AGREEMENT



                  THIS SALE AND PURCHASE AGREEMENT (the "Agreement") is made and
entered into this 16th day of March, 2000, by and between SHOLODGE, INC., a
Tennessee corporation (herein "ShoLodge"), and PRIME HOSPITALITY CORP., a
Delaware corporation (herein "Prime").

                              W I T N E S S E T H:

                  WHEREAS, Prime and ShoLodge desire (i) that a wholly-owned
subsidiary of Prime acquire a leasehold interest in (A) twenty (20) Sumner
Suites hotels which are currently leased from HPT Suite Properties Trust, a
Maryland real estate investment trust, to Suite Tenant, Inc., a Tennessee
corporation and a wholly-owned subsidiary of ShoLodge, and (B) seven (7)
existing Sumner Suites hotels currently owned by wholly-owned subsidiaries of
ShoLodge, and (ii) that Prime acquire two (2) sites currently owned by
wholly-owned subsidiaries of ShoLodge for development as AmeriSuites hotels.

                  NOW, THEREFORE, in consideration of One Hundred Dollars ($100)
paid from Prime to ShoLodge as initial consideration as described herein, the
mutual terms and conditions contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:


                                    ARTICLE I
                                   DEFINITIONS

                  1.1 Definitions. As used in this Agreement, the following
terms shall have the following meanings:

                  "Additional Advance Payments" shall have the meaning set forth
in Section 3.2(b).

                  "Additional Buildings" shall have the meaning set forth in
Section 3.1.

                  "Additional Equipment" shall have the meaning set forth in
Section 3.1.

                  "Additional Hotel Operating Assets" shall have the meaning set
forth in Section 3.2.

                  "Additional Hotel Operating Assets Transfer Documents" shall
have the meaning set forth in Section 3.4



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                  "Additional Hotel Subsidiaries" means the wholly-owned
subsidiaries of ShoLodge which own the Additional HPT Hotels, identified by site
as follows:

                  Owner                     Site
                  -----                     ----
                  Carolina Inns, Inc.       Pine Knoll Shores, North Carolina
                  Midwest Inns, Inc.        Indianapolis, Indiana
                  Midwest Inns, Inc.        Kansas City, Missouri
                  Sunshine Inns, Inc.       Orlando, Florida

                  "Additional HPT Hotels" means the Sumner Suites hotels
currently operated on the Additional Land.

                  "Additional Inventory" shall have the meaning set forth in
Section 3.2(a).

                  "Additional Land" shall have the meaning set forth in Section
3.1.

                  "Additional Operating Agreements" shall have the meaning set
forth in Section 3.2(c).

                  "Additional Property" shall have the meaning set forth in
Section 3.1.

                  "Additional Property Documents" shall have the meaning set
forth in Section 3.3.

                  "Advance Payments" means the STI Advance Payments, the
Additional Advance Payments and the Texas Advance Payments.

                  "Affiliate" means, as applied to any Person, any other Person
who, directly or indirectly, controls, is controlled by, or is under common
control with, such Person. For purposes of this definition, "control" means the
possession, directly or indirectly, of the power to direct the management and
policies of a Person, whether through the ownership of shares, options,
warrants, interests, participations or other equivalents (regardless of how
designated) of or in a Person, whether voting or nonvoting, including common
stock, preferred stock or any other "equity security" (as such term is defined
in Rule 3a11-1 of the General Rules and Regulations promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934, as
amended), by contract or otherwise.

                  "Agreement" means this Sale and Purchase Agreement.

                  "Assets" means collectively the STI Assets, the Additional
Property, the Additional Hotel Operating Assets, the Texas Property, the Texas
Hotel Operating Assets and the Development Sites.

                  "Benefit Plan" shall have the meaning set forth in Section
15.5.






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<PAGE>   3



                  "Buildings" means the STI Buildings, the Additional Buildings
and the Texas Buildings.

                  "Closing" shall mean the conference to be held at 10:00 a.m.,
New York, New York time, on the Closing Date, at the offices of Willkie Farr &
Gallagher, 787 Seventh Avenue, New York, New York, or at such other time and
place on the Closing Date as the parties may mutually agree to in writing, at
which time the transactions contemplated by this Agreement shall be consummated,
or, if permitted as set forth in Section 17.1, at which time one (1) or more of
the transactions contemplated by this Agreement shall be consummated.

                  "Closing Date" shall mean the date on which the Closing
occurs, and, if the Closing with respect to all transactions contemplated herein
does not occur on the same date as contemplated in Section 17.1, the term
"Closing Date" with respect to each transaction contemplated herein shall mean
the date of the actual Closing with respect to each such transaction.

                  "Closing Documents" means all documents to be executed by
Prime, a Prime Subsidiary, ShoLodge or a ShoLodge Subsidiary to consummate the
transactions contemplated in this Agreement, including, without limitation, the
STI Transfer Documents, the Additional Property Documents, the Additional Hotel
Operating Assets Transfer Documents, the Texas Lease, the Texas Hotel Operating
Assets Transfer Documents, the Development Site Transfer Documents, the
Construction Contract and the Reservation Agreement; provided, however, in the
event there is more than one (1) Closing Date as contemplated in Section 17.1,
"Closing Documents" for each such Closing Date means only such of the documents
as described above as are necessary to consummate the transactions contemplated
in this Agreement being closed on such Closing Date.

                  "Code" means the Internal Revenue Code of 1986, as amended.

                  "Construction Contract" shall have the meaning set forth in
Section 7.1.

                  "Development Site Purchase Price" shall have the meaning set
forth in Section 6.2.

                  "Development Site Subsidiaries" means the wholly-owned
subsidiaries of ShoLodge which own the Development Sites, identified by site as
follows:

                           Owner                       Site
                           -----                       ----
                           Delaware Inns, Inc.         Mt. Laurel, New Jersey
                           Virginia Inns, Inc.         Fairfax County, Virginia

                  "Development Site Transfer Documents" shall have the meaning
set forth in Section 5.2.

                  "Development Sites" shall have the meaning set forth in
Section 5.1.





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<PAGE>   4



                  "Due Diligence Period" means the thirty (30) day period
commencing on the Effective Date.

                  "Effective Date" shall mean the date this Agreement is fully
executed by ShoLodge and Prime.

                  "Encumbrance" means any security interest, pledge, mortgage,
lien (including environmental liens), personal property lease, charge, adverse
claim or restriction of any kind, including encumbrances or imperfections of
title of whatever nature.

                  "Equipment" means the STI Equipment, the Additional Equipment
and the Texas Equipment.

                  "ERISA" shall have the meaning set forth in Section 15.5.

                  "Existing HPT Hotels" means the Sumner Suites hotels currently
operated on the STI Land.

                  "Financial Information" shall have the meaning set forth in
Section 15.19.

                  "Hendersonville Restriction" shall have the meaning set forth
in Section 17.6.

                  "Hotel" and "Hotels" shall mean individually one of the
Existing HPT Hotels or one of the Additional HPT Hotels or one of the Texas
Hotels and collectively the Existing HPT Hotels, the Additional HPT Hotels and
the Texas Hotels.

                  "HPT" means Hospitality Properties Trust, a Maryland real
estate investment trust, and its successors and assigns.

                  "HPT Assignment and Security Agreement" means that certain
Assignment and Security Agreement dated as of November 19, 1997 between STI and
Landlord, as amended by that certain Second Amendment to Lease Agreement and
First Amendment to Incidental Documents dated as of June 29, 1999 among HPT,
Landlord, ShoLodge and STI, together with such subsequent amendments,
modifications and supplements thereto as shall have been approved by Prime in
writing prior to execution by STI, such approval not to be unreasonably
withheld, delayed or conditioned.

                  "HPT Documents" means the HPT Lease and the HPT Incidental
Documents.

                  "HPT Estoppel Certificate" means the estoppel certificate from
HPT in favor of Prime and the Prime HPT Subsidiary substantially in the form of
Exhibit H attached hereto and incorporated herein by this reference.

                  "HPT Incidental Documents" means the HPT Lease Guaranty, the
HPT Security Agreement, the HPT Stock Pledge and the HPT Assignment and Security
Agreement.






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<PAGE>   5


                  "HPT Lease" means that certain Lease Agreement dated as of
November 19, 1997 between Landlord and STI, as amended by that certain First
Amendment to Lease Agreement dated as of March 5, 1999 between Landlord and STI,
by that certain Second Amendment to Lease Agreement and First Amendment to
Incidental Documents dated as of June 29, 1999 among HPT, Landlord, ShoLodge and
STI and by that certain Third Amendment to Lease Agreement dated as of March 3,
2000 between Landlord and STI, together with such subsequent amendments,
modifications and supplements thereto as shall have been approved by Prime in
writing prior to execution by STI, such approval not to be unreasonably
withheld, delayed or conditioned.

                  "HPT Lease Amendment" shall have the meaning set forth in
Section 11.6.

                  "HPT Lease Guaranty" means that certain Limited Guaranty
Agreement dated as of November 19, 1997 executed by ShoLodge in favor of HPT and
Landlord, as amended by that certain Second Amendment to Lease Agreement and
First Amendment to Incidental Documents dated as of June 29, 1999 among HPT,
Landlord, ShoLodge and STI, together with such subsequent amendments,
modifications and supplements thereto as shall have been approved by Prime in
writing prior to execution by ShoLodge, such approval not to be unreasonably
withheld, delayed or conditioned.

                  "HPT Lease Guaranty Deposit" means the "Guaranty Deposit" in
the amount of Fourteen Million and No/100 Dollars ($14,000,000.00) deposited by
ShoLodge with HPT and Landlord to secure the obligations of ShoLodge under the
HPT Lease Guaranty.

                  "HPT Lease Security Deposit" means the "Retained Funds" in the
amount of Twenty-One Million Two Hundred Eighty Thousand and No/100 Dollars
($21,280,000.00) deposited by STI with Landlord to secure the obligations of STI
under the HPT Lease.

                  "HPT Real Property" means the STI Land, the STI Buildings, the
Additional Land and the Additional Buildings.

                  "HPT Security Agreement" means that certain Security Agreement
dated as of November 19, 1997 between STI and Landlord, as amended by that
certain Second Amendment to Lease Agreement and First Amendment to Incidental
Documents dated as of June 29, 1999 among HPT, Landlord, ShoLodge and STI and by
that certain Second Amendment to Security Agreement dated as of March 3, 2000
between Landlord and STI, together with such subsequent amendments,
modifications and supplements thereto as shall have been approved by Prime in
writing prior to execution by STI, such approval not to be unreasonably
withheld, delayed or conditioned.

                  "HPT Stock Pledge" means that certain Stock Pledge dated as of
November 19, 1997 made by ShoLodge in favor of Landlord, as amended by that
certain Second Amendment to Lease Agreement and First Amendment to Incidental
Documents dated as of June 29, 1999 among HPT, Landlord, ShoLodge and STI,
together with such subsequent amendments, modifications and supplements thereto
as shall have been approved by Prime in writing prior to execution by ShoLodge,
such approval not to be unreasonably withheld, delayed or conditioned.






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                  "Indemnified Party" shall have the meaning set forth in
Section 19.4.

                  "Indemnifying Party" shall have the meaning set forth in
Section 19.4.

                  "Initial Consideration" shall have the meaning set forth in
Section 9.3.

                  "Inventory" means the STI Inventory, the Additional Inventory
and the Texas Inventory.

                  "Landlord" means HPT Suite Properties Trust, a Maryland real
estate investment trust, and its successors and assigns.

                  "Moore" means Moore and Associates, Inc., a Tennessee
corporation and a wholly-owned subsidiary of ShoLodge, and its successors and
assigns.

                  "Operating Agreements" means the STI Operating Agreements, the
Additional Operating Agreements and the Texas Operating Agreements.

                  "Permitted Exceptions" means (a) with respect to all Assets,
(i) liens for taxes, assessments and governmental charges with respect to an
Asset not yet due and payable or due and payable but not yet delinquent or as to
which adequate reserves are provided therefor, (ii) those Encumbrances
contemplated in this Agreement, and (iii) such other Encumbrances as shall be
approved or deemed approved by Prime pursuant to Section 12.1; (b) with respect
to the HPT Real Property only, the HPT Lease; (c) with respect to the Additional
Property only, the HPT Lease as amended or a separate lease as contemplated in
Section 3.3 and in Section 3.8, if applicable; (d) with respect to the Texas
Property only, the Texas Lease; (e) with respect to the Hendersonville,
Tennessee Hotel only, the Hendersonville Restriction; and (f) with respect to
the Real Property only, applicable zoning regulations and ordinances provided
the same do not prohibit or impair in any material respect use of such Real
Property as a hotel as currently operated or constructed or, as to the
Development Sites, as proposed to be operated or constructed.

                  "Person" means natural persons, corporations, limited
liability companies, limited partnerships, general partnerships, limited
liability partnerships, joint ventures, trusts, land trusts, business trusts and
other organizations, irrespective of whether they are legal entities, and
governments and agencies and political subdivisions thereof.

                  "Post Termination Obligations" shall have the meaning set
forth in Section 14.1.

                  "Prime" means Prime Hospitality Corp., a Delaware corporation,
and its successors and permitted assigns.

                  "Prime Subsidiaries" means the Prime HPT Subsidiary and the
Prime Texas Subsidiary.





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                  "Prime HPT Subsidiary" means the wholly-owned subsidiary of
Prime which acquires the STI Assets and the Additional Hotel Operating Assets
and which leases the Additional Property pursuant to this Agreement, and its
successors and permitted assigns.

                  "Prime Texas Subsidiary" means the wholly-owned subsidiary of
Prime which acquires the Texas Hotel Operating Assets and which leases the Texas
Property pursuant to this Agreement, and its successors and permitted assigns.

                  "Purchase Price" shall have the meaning set forth in
Section 6.1.

                  "Real Property" means the STI Land, the STI Buildings, the
Additional Land, the Additional Buildings, the Texas Land, the Texas Buildings
and the Development Sites.

                  "Reservation Agreement" shall have the meaning set forth in
Section 8.1.

                  "ShoLodge" means ShoLodge, Inc., a Tennessee corporation, and
its successors and assigns.

                  "ShoLodge Subsidiaries" means STI, the Additional Hotel
Subsidiaries, Southeast, the Development Site Subsidiaries and Moore.

                  "Southeast" means Southeast Texas Inns, Inc., a Tennessee
corporation and a wholly-owned subsidiary of ShoLodge, and its successors and
assigns.

                  "STI" means Suite Tenant, Inc., a Tennessee corporation and a
wholly-owned subsidiary of ShoLodge, and its successors and assigns.

                  "STI Advance Payments" shall have the meaning set forth in
Section 2.1(c).

                  "STI Assets" shall have the meaning set forth in Section 2.1.

                  "STI Buildings" shall have the meaning set forth in Section
2.1(a).

                  "STI Equipment" shall have the meaning set forth in Section
2.1(a).

                  "STI Inventory" shall have the meaning set forth in Section
2.1(b).

                  "STI Operating Agreements" shall have the meaning set forth in
Section 2.1(d).

                  "STI Land" shall have the meaning set forth in Section 2.1(a).

                  "STI Leased Property" shall have the meaning set forth in
Section 2.1(a).

                  "STI Transfer Documents" shall have the meaning set forth in
Section 2.2.




                                      - 7 -

<PAGE>   8




                  "Texas Advance Payments" shall have the meaning set forth in
Section 4.2(b).

                  "Texas Buildings" shall have the meaning set forth in Section
4.1.

                  "Texas Equipment" shall have the meaning set forth in Section
4.1.

                  "Texas Hotel Operating Assets" shall have the meaning set
forth in Section 4.2.

                  "Texas Hotel Operating Assets Transfer Documents" shall have
the meaning set forth in Section 4.4.

                  "Texas Hotels" means the Sumner Suites hotels currently
operated on the Texas Land.

                  "Texas Inventory" shall have the meaning set forth in Section
4.2(a).

                  "Texas Land" shall have the meaning set forth in Section 4.1.

                  "Texas Lease" shall have the meaning set forth in Section 4.3.

                  "Texas Operating Agreements" shall have the meaning set forth
in Section 4.2(c).

                  "Texas Property" shall have the meaning set forth in Section
4.1.

                  "Texas Real Property" means the Texas Land and the Texas
Buildings.


                                   ARTICLE II
                           SALE OF EXISTING HPT HOTELS

                  2.1 Sale of STI Assets. ShoLodge hereby agrees to cause STI,
at the Closing and in the manner specified in Section 2.2 of this Agreement, to
sell, convey, transfer, assign and deliver to the Prime HPT Subsidiary, and
Prime hereby agrees to cause the Prime HPT Subsidiary, at the Closing and in the
manner specified in Section 2.2 of this Agreement, to purchase from STI, all the
following (collectively, the "STI Assets"):

                  (a) all right, title and interest of STI in and to the HPT
Lease, including, without limitation, the HPT Lease Security Deposit and, except
as limited in the last paragraph of Section 19.3, the "FF&E Reserve" created
pursuant to the HPT Lease, and in and to (i) that certain real property more
particularly described on Exhibit A attached hereto and incorporated herein by
this reference (the "STI Land"); (ii) any and all buildings, structures and
similar improvements erected on, over, upon or under the STI Land on the Closing
Date (the "STI Buildings"); and (iii) all furniture, fixtures and equipment
located thereon or therein on the Closing Date (the "STI Equipment") (the STI
Land, the STI Buildings and the STI Equipment are referred to herein
collectively as the "STI Leased Property");





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<PAGE>   9

                  (b) all merchandise, inventories, materials and supplies used
or intended for use or held for use in connection with and located on the
Closing Date at the STI Land (collectively, the "STI Inventory");

                  (c) all reservation and advance booking deposits and guest
security deposits (including interest, if any, accrued thereon) for guests or
future guests of the Existing HPT Hotels existing on the Closing Date (the "STI
Advance Payments");

                  (d) to the extent assignable, all of STI's right, title and
interest, if any, in and to all service contracts, vendor agreements,
maintenance agreements, utility contracts, cable service agreements, advertising
agreements, equipment leases and similar operating agreements relating to the
Existing HPT Hotels and in effect on the Closing Date (collectively, the "STI
Operating Agreements");

                  (e) to the extent assignable, all of STI's right, title and
interest, if any, in and to all licenses and permits for the sale and
on-premises consumption of liquor and other alcoholic beverages at the Existing
HPT Hotels in effect on the Closing Date; and

                  (f) all vehicles owned by STI and located at and used in
connection with the Existing HPT Hotels on the Closing Date.

                  2.2 Transfer of STI Assets. The sale, conveyance, transfer,
assignment and delivery of the STI Assets hereunder will be effected by the
delivery by STI to the Prime HPT Subsidiary at the Closing of the Assignment and
Assumption of Lease Agreement in the form of Exhibit E attached hereto and
incorporated herein by this reference, the Bill of Sale in the form of Exhibit F
attached hereto and incorporated herein by this reference, the Assignment and
Assumption of Contracts in the form of Exhibit G attached hereto and
incorporated herein by this reference and such other instruments of sale,
transfer, assignment and conveyance as STI and the Prime HPT Subsidiary shall
reasonably request in form and substance reasonably satisfactory to STI and the
Prime HPT Subsidiary (which shall include an assumption by the Prime HPT
Subsidiary of all liabilities of STI under the HPT Security Agreement and under
the HPT Assignment and Security Agreement which first accrue after the Closing
Date) (such documents being referred to herein as the "STI Transfer Documents").
The STI Assets shall be transferred free and clear of all Encumbrances, but
subject to the Permitted Exceptions which relate to the STI Assets and to the
STI Operating Agreements. From and after Closing, all liabilities of STI under
the STI Operating Agreements and under the instruments creating the Permitted
Exceptions which relate to the STI Assets and which first accrue after the
Closing Date shall be the responsibility of the Prime HPT Subsidiary.

                  2.3 HPT Lease Guaranty. As a condition to the transfer of the
STI Assets from STI to the Prime HPT Subsidiary, Prime will assume all
obligations of ShoLodge under the HPT Lease Guaranty which first accrue from and
after the Closing Date. ShoLodge will use its best efforts to obtain from HPT
and/or Landlord the return of the HPT Lease Guaranty Deposit. If ShoLodge is
unable to obtain the return of the HPT Lease Guaranty Deposit from HPT and/or
Landlord, Prime will pay to ShoLodge at Closing the sum of Fourteen Million and
No/100 Dollars




                                     - 9 -
<PAGE>   10

($14,000,000.00) in cash or other immediately available funds in exchange for
the absolute assignment by ShoLodge to Prime of all right, title and interest of
ShoLodge in and to the HPT Lease Guaranty Deposit, so long as HPT and Landlord
agree or consent to such assignment and so long as the HPT Estoppel Certificate
acknowledges that (i) there are no existing defaults nor events which with the
giving of notice or the passage of time may become defaults by STI under the HPT
Lease nor any cause for HPT or Landlord to offset any obligation of STI under
the HPT Lease against the HPT Lease Guaranty Deposit, and (ii) as of the date of
the HPT Estoppel Certificate, the HPT Lease Security Deposit is Twenty-One
Million Two Hundred Eighty Thousand and No/100 Dollars ($21,280,000.00) and the
HPT Lease Guaranty Deposit is Fourteen Million and No/100 Dollars
($14,000,000.00).

                  2.4 Further Assurances. ShoLodge covenants that at the Closing
and from time to time after the Closing, it will, upon the reasonable request of
the Prime HPT Subsidiary or Prime, cause STI to execute, acknowledge and
deliver, and to do or cause to be done, executed, acknowledged and delivered,
all such additional documents or actions as may be reasonably required by the
Prime HPT Subsidiary or Prime, in order more effectively to sell, convey,
transfer, assign and deliver to the Prime HPT Subsidiary the STI Assets in the
manner described in Sections 2.1 and 2.2 above, and to carry out the intention
and purposes of this Article II and the transactions contemplated hereby and to
evidence and preserve the ownership by the Prime HPT Subsidiary of the STI
Assets, provided neither ShoLodge nor STI shall incur any liability, cost or
expense not contemplated by this Agreement. The provisions of this Section 2.4
shall survive the Closing.

                  2.5 Sumner Suites Name. The Prime HPT Subsidiary shall be
allowed to continue operating each of the Existing HPT Hotels as a "Sumner
Suites" for a period of not more than nine (9) months from the Closing Date, at
which time all Existing HPT Hotels must be converted to another flag at the sole
cost and expense of the Prime HPT Subsidiary. The provisions of this Section 2.5
shall survive the Closing.


                                   ARTICLE III
                          SALE OF ADDITIONAL HPT HOTELS

                  3.1 Sale of Additional Property to Landlord. ShoLodge hereby
agrees (i) to cause the Additional Hotel Subsidiaries, at the Closing and in the
manner specified in Section 3.3 of this Agreement, to sell, convey, transfer,
assign and deliver to Landlord all right, title and interest of the Additional
Hotel Subsidiaries in and to (A) that certain real property more particularly
described on Exhibit B attached hereto and incorporated herein by this reference
(the "Additional Land"); (B) any and all buildings, structures and similar
improvements erected on, over, upon or under the Additional Land on the Closing
Date (the "Additional Buildings"); and (C) all furniture, fixtures and equipment
located thereon or therein on the Closing Date (the "Additional Equipment") (the
Additional Land, the Additional Buildings and the Additional Equipment are
referred to herein collectively as the "Additional Property"); and (ii) to use
its best efforts to cause Landlord to lease the Additional Property to the Prime
HPT Subsidiary, and, if Landlord agrees to the same, Prime hereby agrees to
cause the Prime HPT Subsidiary, at the




                                     - 10 -
<PAGE>   11

Closing and in the manner specified in Section 3.3 of this Agreement, to lease
the Additional Property from Landlord.

                  3.2 Sale of Additional Hotel Operating Assets. ShoLodge hereby
agrees to cause the Additional Hotel Subsidiaries, at the Closing and in the
manner specified in Section 3.4 of this Agreement, to sell, convey, transfer,
assign and deliver to the Prime HPT Subsidiary, and Prime hereby agrees to cause
the Prime HPT Subsidiary, at the Closing and in the manner specified in Section
3.4 of this Agreement, to purchase from the Additional Hotel Subsidiaries, all
the following (collectively, the "Additional Hotel Operating Assets"):

                  (a) all merchandise, inventories, materials and supplies used
or intended for use or held for use in connection with and located on the
Closing Date at the Additional Land (collectively, the "Additional Inventory");

                  (b) all reservation and advance booking deposits and guest
deposits (including interest, if any, accrued thereon) for guests or future
guests of the Additional HPT Hotels existing on the Closing Date (the
"Additional Advance Payments");

                  (c) to the extent assignable, all of the right, title and
interest of the Additional Hotel Subsidiaries, if any, in and to all service
contracts, vendor agreements, maintenance agreements, utility contracts, cable
service agreements, advertising agreements, equipment leases and similar
operating agreements relating to the Additional HPT Hotels and in effect on the
Closing Date (collectively, the "Additional Operating Agreements");

                  (d) to the extent assignable, all of the right, title and
interest of the Additional Hotel Subsidiaries, if any, in and to licenses and
permits for the sale and on-premises consumption of liquor and other alcoholic
beverages at the Additional HPT Hotels in effect on the Closing Date; and

                  (e) all vehicles owned by the Additional Hotel Subsidiaries
and located at and used in connection with the Additional HPT Hotels on the
Closing Date.

Notwithstanding the foregoing, the obligation of the Prime HPT Subsidiary to
accept the transfer of any or all of the Additional Hotel Operating Assets shall
be conditioned upon the lease of the corresponding Additional Property by the
Prime HPT Subsidiary as contemplated in Sections 3.1 and 3.3.

                  3.3 Transfer of Additional Property. The sale, conveyance,
transfer, assignment and delivery of the Additional Property hereunder will be
effected by the delivery by the Additional Hotel Subsidiaries to Landlord at the
Closing of instruments of sale, transfer, assignment and conveyance in form and
substance reasonably satisfactory to the Additional Hotel Subsidiaries and
Landlord, and the lease of the Additional Property from Landlord to the Prime
HPT Subsidiary shall be effected either by an amendment to the HPT Lease or by
separate lease which contains terms and provisions reasonably satisfactory to
Prime, but Prime shall not have reason to object to any terms and provisions
which are in the HPT Lease unless an objection to




                                     - 11 -
<PAGE>   12

such terms and provisions is made in accordance with the provisions of Section
12.1; provided, however, the minimum annual rent under such lease with respect
to the Additional Property shall be Four Million Three Hundred Sixty-Five
Thousand and No/100 Dollars ($4,365,000.00), allocated as set forth in Exhibit P
attached hereto and incorporated herein by this reference (such documents being
referred to herein as the "Additional Property Documents"). Notwithstanding the
foregoing, ShoLodge, by written notice to Prime, may adjust the minimum annual
rent for the Additional Property and the allocation thereof by up to ten percent
(10%) of the amount thereof per Hotel as long as (i) the aggregate minimum
annual rent for the Additional Property and the Texas Property does not exceed
Seven Million Four Hundred Twenty-Three Thousand and No/100 Dollars
($7,423,000.00), and (ii) the lease of the Additional Property and the Texas
Property shall have the same initial term and renewal options as provided in the
HPT Lease. The Additional Property shall be transferred to Landlord and leased
by the Prime HPT Subsidiary free and clear of all Encumbrances, but subject to
the Permitted Exceptions which relate to the Additional Property and to the
Additional Operating Agreements. From and after Closing, all liabilities of the
Additional Hotel Subsidiaries under the Additional Operating Agreements and
under the instruments creating the Permitted Exceptions which relate to the
Additional Property and which first accrue after the Closing Date shall be the
responsibility of the Prime HPT Subsidiary.

                  3.4 Transfer of Additional Hotel Operating Assets. The sale,
conveyance, transfer, assignment and delivery of the Additional Hotel Operating
Assets hereunder will be effected by the delivery by the Additional Hotel
Subsidiaries to the Prime HPT Subsidiary at the Closing of the Bill of Sale in
the form of Exhibit F attached hereto and incorporated herein by this reference,
the Assignment and Assumption of Contracts in the form of Exhibit G attached
hereto and incorporated herein by this reference and such other instruments of
sale, transfer, assignment and conveyance as an Additional Hotel Subsidiary or
the Prime HPT Subsidiary shall reasonably request in form and substance
reasonably satisfactory to the Additional Hotel Subsidiaries and the Prime HPT
Subsidiary (such documents being referred to herein as the "Additional Hotel
Operating Assets Transfer Documents"). The Additional Hotel Operating Assets
shall be transferred free and clear of all Encumbrances, but subject to the
Permitted Exceptions which relate to the Additional Hotel Operating Assets and
to the Additional Operating Agreements. From and after Closing, all liabilities
of the Additional Hotel Subsidiaries under the Additional Operating Agreements
and under the instruments creating the Permitted Exceptions which relate to the
Additional Hotel Operating Assets and which first accrue after the Closing Date
shall be the responsibility of the Prime HPT Subsidiary.

                  3.5 Prime Guaranty. Prime will guarantee all obligations of
the Prime HPT Subsidiary with respect to the lease of the Additional Property
pursuant to an amendment to the HPT Lease Guaranty or a separate instrument
which contains terms and provisions reasonably satisfactory to Prime, but Prime
shall not have reason to object to any terms and provisions which are in the HPT
Lease Guaranty unless an objection to such terms and provisions is made in
accordance with the provisions of Section 12.1; provided, however, that (i) the
liability of Prime thereunder shall be limited to an amount equal to minimum
annual rent for the Additional Property for one (1) year, and (ii) Prime shall
not be required to increase the HPT Lease Guaranty Deposit pursuant to the HPT
Lease Guaranty (as amended in connection with such transaction) or to deposit a
"Guaranty Deposit" in connection with a separate guaranty.





                                     - 12 -
<PAGE>   13

                 3.6 Further Assurances. ShoLodge covenants that at the Closing
and from time to time after the Closing, it will, upon the reasonable request of
the Prime HPT Subsidiary or Prime, cause the Additional Hotel Subsidiaries to
execute, acknowledge and deliver, and to do or cause to be done, executed,
acknowledged and delivered, all such additional documents or actions as may be
reasonably required by the Prime HPT Subsidiary or Prime, in order more
effectively to sell, convey, transfer, assign and deliver to the Prime HPT
Subsidiary the Additional Hotel Operating Assets in the manner described in
Sections 3.2 and 3.4 above, and to carry out the intention and purposes of this
Article III and the transactions contemplated hereby and to evidence and
preserve the ownership by the Prime HPT Subsidiary of the Additional Hotel
Operating Assets and the lease by the Prime HPT Subsidiary of the Additional
Property, provided neither ShoLodge nor the Additional Hotel Subsidiaries shall
incur any liability, cost or expense not contemplated by this Agreement. The
provisions of this Section 3.6 shall survive the Closing.

                  3.7 Sumner Suites Name. The Prime HPT Subsidiary shall be
allowed to continue operating each of the Additional HPT Hotels as a "Sumner
Suites" for a period of not more than nine (9) months from the Closing Date, at
which time all Additional HPT Hotels must be converted to another flag at the
sole cost and expense of the Prime HPT Subsidiary. The provisions of this
Section 3.7 shall survive the Closing.

                  3.8 Advance HPT Closing. ShoLodge, at its option, may proceed
to close the transfer of the Additional Property from the Additional Hotel
Subsidiaries to Landlord as contemplated in part (i) of Section 3.1 prior to the
Closing. In such event, the Additional Property will be leased from Landlord to
STI either by an amendment to the HPT Lease or by separate lease identical to
the amendment or separate lease contemplated in Section 3.3 (but with STI as the
tenant), and at Closing the interest of STI in the Additional Property will be
transferred to the Prime HPT Subsidiary in the same manner as the transfer of
the STI Leased Assets contemplated in Article II, including, without limitation,
with the same further assurances as set forth in Section 2.4. Without limiting
the generality of the foregoing, in such event, ShoLodge agrees to cause STI to
sell, convey, transfer, assign and deliver to the Prime HPT Subsidiary, and
Prime agrees to cause the Prime HPT Subsidiary, at the Closing, to purchase from
STI, all right, title and interest of STI in and to the HPT Lease (as so
amended) or the separate lease, as applicable, including without limitation, the
amount added to the "Retained Funds" under the HPT Lease if so amended or the
"Retained Funds" under such separate lease, as applicable, and, except as
limited in the last paragraph of Section 19.3, the "FF&E Reserve" created
pursuant to the HPT Lease (as so amended) or the separate lease, as applicable,
and in and to the Additional Property, such sale, conveyance, transfer,
assignment and delivery of the Additional Property to be effected by the
delivery by STI to the Prime HPT Subsidiary at the Closing of the Assignment and
Assumption of Lease Agreement in the form of Exhibit E attached hereto and
incorporated herein by this reference. Further, in such event, any guaranty by
ShoLodge of the lease to STI of the Additional Property (whether by virtue of an
amendment to the HPT Lease Guaranty or by separate instrument) shall be treated
like the HPT Lease Guaranty as described in Section 2.3 to the extent any such
guaranty by ShoLodge is consistent with Section 3.5. At least ten (10) days
prior to execution, ShoLodge shall deliver to Prime a copy of the amendment to
the HPT Lease or separate lease and a copy of the amendment to the HPT Lease
Guaranty or separate instrument as contemplated in this Section 3.8 for Prime's
written approval, such approval not to be




                                     - 13 -
<PAGE>   14

unreasonably withheld, delayed or conditioned. In no event shall ShoLodge or any
ShoLodge Subsidiary execute any such amendment to the HPT Lease or separate
lease without Prime's prior written approval.

                  3.9 Direct Lease. ShoLodge, at its option, may cause the
Additional Property (or one (1) or more, but less than all, of the Additional
HPT Hotels and the portion of the Additional Land, the Additional Buildings and
the Additional Equipment relating thereto) to be leased to the Prime Texas
Subsidiary by the Additional Hotel Subsidiaries (or the appropriate Additional
Hotel Subsidiary or Subsidiaries, if only a portion of the Additional Property
is so leased) in the same manner as the Texas Property is leased to the Prime
Texas Subsidiary pursuant to Article IV, but with the terms of such lease being
consistent with Section 3.3. In such event, all applicable references to the
Texas Property in this Agreement shall be deemed to include the Additional
Property (or such Additional HPT Hotel or such Additional HPT Hotels and the
portion of the Additional Land, the Additional Buildings and the Additional
Equipment relating thereto), and all applicable references to Southeast in this
Agreement shall be deemed to include the appropriate Additional Hotel Subsidiary
or Subsidiaries.

                                   ARTICLE IV
                              SALE OF TEXAS HOTELS

                  4.1 Lease of Texas Property. ShoLodge hereby agrees to cause
Southeast, at the Closing and in the manner specified in Section 4.3 of this
Agreement, to lease to the Prime Texas Subsidiary, and Prime hereby agrees to
cause the Prime Texas Subsidiary, at the Closing and in the manner specified in
Section 4.3 of this Agreement, to lease from Southeast, (A) that certain real
property more particularly described on Exhibit C attached hereto and
incorporated herein by this reference (the "Texas Land"); (B) any and all
buildings, structures and similar improvements erected on, over, upon or under
the Texas Land on the Closing Date (the "Texas Buildings"); and (C) all
furniture, fixtures and equipment located thereon or therein on the Closing Date
(the "Texas Equipment") (the Texas Land, the Texas Buildings and the Texas
Equipment are referred to herein collectively as the "Texas Property").

                  4.2 Sale of Texas Hotel Operating Assets. ShoLodge hereby
agrees to cause Southeast, at the Closing and in the manner specified in Section
4.4 of this Agreement, to sell, convey, transfer, assign and deliver to the
Prime Texas Subsidiary, and Prime hereby agrees to cause the Prime Texas
Subsidiary, at the Closing and in the manner specified in Section 4.4 of this
Agreement, to purchase from Southeast, all the following (collectively, the
"Texas Hotel Operating Assets"):

                  (a) all merchandise, inventories, materials and supplies used
or intended for use or held for use in connection with and located on the
Closing Date at the Texas Land (collectively, the "Texas Inventory");

                  (b) all reservation and advance booking deposits and guest
deposits (including interest, if any, accrued thereon) for guests or future
guests of the Texas Hotels existing on the Closing Date (the "Texas Advance
Payments");





                                     - 14 -
<PAGE>   15

                  (c) to the extent assignable, all of the right, title and
interest of Southeast, if any, in and to all service contracts, vendor
agreements, maintenance agreements, utility contracts, cable service agreements,
advertising agreements, equipment leases and similar operating agreements
relating to the Texas Hotels and in effect on the Closing Date (collectively,
the "Texas Operating Agreements");

                  (d) to the extent assignable, all of the right, title and
interest of Southeast, if any, in and to licenses and permits for the sale and
on-premises consumption of liquor and other alcoholic beverages at the Texas
Hotels in effect on the Closing Date; and

                  (e) all vehicles owned by Southeast and located at and used in
connection with the Texas Hotels on the Closing Date.

Notwithstanding the foregoing, the obligation of the Prime Texas Subsidiary to
accept the transfer of any or all of the Texas Hotel Operating Assets shall be
conditioned upon the lease of the Texas Property by the Prime Texas Subsidiary
as contemplated in Sections 4.1 and 4.3.

                  4.3 Lease of Texas Property. The lease of the Texas Property
from Southeast to the Prime Texas Subsidiary shall be effected by lease (the
"Texas Lease") which contains terms and provisions reasonably satisfactory to
Prime, but Prime shall not have reason to object to any terms and provisions
which are in the HPT Lease unless an objection to such terms and provisions is
made in accordance with the provisions of Section 12.1; provided, however, (i)
the Prime Texas Subsidiary shall be deemed to have deposited "Retained Funds" in
an amount equal to the same multiple of the minimum annual rent under such lease
with respect to the Texas Property as is required by Landlord with respect to
the Additional Property pursuant to an amendment to the HPT Lease or a separate
lease as contemplated in Section 3.3, and (ii) the minimum annual rent under
such lease with respect to the Texas Property shall be Three Million Fifty-Eight
Thousand and No/100 Dollars ($3,058,000.00), allocated as set forth in Exhibit P
attached hereto and incorporated herein by this reference. Notwithstanding the
foregoing, ShoLodge, by written notice to Prime, may adjust the minimum annual
rent for the Texas Property and the allocation thereof by up to ten percent
(10%) of the amount thereof per Hotel as long as (i) the aggregate minimum
annual rent for the Additional Property and the Texas Property does not exceed
Seven Million Four Hundred Twenty-Three Thousand and No/100 Dollars
($7,423,000.00), and (ii) the lease of the Additional Property and the Texas
Property shall have the same initial term and renewal options as provided in the
HPT Lease. The obligations of the Prime Texas Subsidiary under the Texas Lease
shall be secured by a security interest in the personal property located at the
Texas Real Property and in the "FF&E Reserve" created pursuant to the Texas
Lease and by a pledge of the stock of the Prime Texas Subsidiary pursuant to
documents which contain terms and provisions reasonably satisfactory to Prime,
but Prime shall not have reason to object to any terms and provisions which are
in the HPT Security Agreement, the HPT Assignment and Security Agreement or the
HPT Stock Pledge unless an objection to such terms and provisions is made in
accordance with the provisions of Section 12.1. The Texas Property shall be
leased by the Prime Texas Subsidiary free and clear of all Encumbrances, but
subject to the Permitted Exceptions which relate to the Texas Property and to
the Texas Operating Agreements. From and after Closing, all liabilities of
Southeast under the Texas Operating Agreements and under the




                                     - 15 -
<PAGE>   16

instruments creating the Permitted Exceptions which relate to the Texas Property
and which first accrue after the Closing Date shall be the responsibility of the
Prime Texas Subsidiary. The obligation of Southeast to deliver the "Retained
Funds" upon the expiration of the Texas Lease pursuant to the terms thereof
shall be guaranteed by ShoLodge pursuant to an instrument in form and substance
reasonably satisfactory to Prime and ShoLodge, but such undertaking by ShoLodge
shall terminate upon the transfer of the Texas Property to HPT or an Affiliate
of HPT or to another Person whose financial condition is equivalent to or better
than that of HPT on the date of such transfer, provided that such transferee has
assumed the obligation of Southeast to deliver the "Retained Funds" upon the
expiration of the Texas Lease.

                  4.4 Transfer of Texas Hotel Operating Assets. The sale,
conveyance, transfer, assignment and delivery of the Texas Hotel Operating
Assets hereunder will be effected by the delivery by Southeast to the Prime
Texas Subsidiary at the Closing of the Bill of Sale in the form of Exhibit F
attached hereto and incorporated herein by this reference, the Assignment and
Assumption of Contracts in the form of Exhibit G attached hereto and
incorporated herein by this reference and such other instruments of sale,
transfer, assignment and conveyance as Southeast or the Prime Texas Subsidiary
shall reasonably request in form and substance reasonably satisfactory to
Southeast and the Prime Texas Subsidiary (such documents being referred to
herein as the "Texas Hotel Operating Assets Transfer Documents"). The Texas
Hotel Operating Assets shall be transferred free and clear of all Encumbrances,
but subject to the Permitted Exceptions which relate to the Texas Hotel
Operating Assets and to the Texas Operating Agreements. From and after Closing,
all liabilities of Southeast under the Texas Operating Agreements and under the
instruments creating the Permitted Exceptions which relate to the Texas Hotel
Operating Assets and which first accrue after the Closing Date shall be the
responsibility of the Prime Texas Subsidiary.

                  4.5 Prime Guaranty. Prime will guarantee all obligations of
the Prime Texas Subsidiary with respect to the lease of the Texas Property
pursuant to an instrument which contains terms and provisions reasonably
satisfactory to Prime, but Prime shall not have reason to object to any terms
and provisions which are in the HPT Lease Guaranty unless an objection to such
terms and provisions is made in accordance with the provisions of Section 12.1;
provided, however, that (i) the liability of Prime thereunder shall be limited
to an amount equal to minimum annual rent for the Texas Property for one (1)
year, and (ii) Prime shall not be required to deposit a "Guaranty Deposit" in
connection with such guaranty.

                  4.6 Further Assurances. ShoLodge covenants that at the Closing
and from time to time after the Closing, it will, upon the reasonable request of
the Prime Texas Subsidiary or Prime, cause Southeast to execute, acknowledge and
deliver, and to do or cause to be done, executed, acknowledged and delivered,
all such additional documents or actions as may be reasonably required by the
Prime Texas Subsidiary or Prime, in order more effectively to sell, convey,
transfer, assign and deliver to the Prime Texas Subsidiary the Texas Hotel
Operating Assets in the manner described in Sections 4.2 and 4.4 above, and to
carry out the intention and purposes of this Article IV and the transactions
contemplated hereby and to evidence and preserve the ownership by the Prime
Texas Subsidiary of the Texas Hotel Operating Assets and the lease by the Prime
Texas Subsidiary of the Texas Property, provided neither ShoLodge nor Southeast




                                     - 16 -
<PAGE>   17

shall incur any liability, cost or expense not contemplated by this Agreement.
The provisions of this Section 4.6 shall survive the Closing.

                  4.7 Sumner Suites Name. The Prime Texas Subsidiary shall be
allowed to continue operating each of the Texas Hotels as a "Sumner Suites" for
a period of not more than nine (9) months from the Closing Date, at which time
all Texas Hotels must be converted to another flag at the sole cost and expense
of the Prime Texas Subsidiary. The provisions of this Section 4.7 shall survive
the Closing.

                  4.8 AmeriSuites Name. In the event that the Texas Lease is
terminated prior to the expiration of the term thereof due to a breach or
default by the Prime Texas Subsidiary, Prime and Southeast shall enter into a
license or franchise agreement whereby Southeast is given the right to operate
the Texas Hotels as "AmeriSuites" hotels, which agreement shall be the standard
license or franchise agreement, if any, then used, or most recently used if a
standard license or franchise agreement is not then being used, by Prime to
franchise "AmeriSuites" hotels, but with (i) a minimum term of ten (10) years,
(ii) a royalty equal to one-half (1/2) of the standard royalty for "AmeriSuites"
franchisees (provided Southeast shall pay full marketing and reservation fees),
and (iii) no "initial" fee or "license" fee due upon signing such agreement. The
provisions of this Section 4.8 shall survive the Closing.

                  4.9 HPT Lease. ShoLodge, at its option, may cause the Texas
Property (or one (1) or more, but less than all, of the Texas Hotels and the
portion of the Texas Land, the Texas Buildings and the Texas Equipment relating
thereto) to be leased to the Prime HPT Subsidiary by Landlord as if the Texas
Property (or the portion thereof) were Additional Property, but with the terms
of such lease being consistent with Section 4.3. In such event, all applicable
references to the Additional Property in this Agreement shall be deemed to
include the Texas Property (or such Texas Hotel or Texas Hotels and the portion
of the Texas Land, the Texas Buildings and the Texas Equipment relating
thereto), and all applicable references to the Additional Hotel Subsidiaries in
this Agreement shall be deemed to include Southeast. The failure of Landlord to
lease the Texas Property (or portion thereof) to the Prime HPT Subsidiary,
however, shall not constitute a condition precedent to the obligation of
ShoLodge to close pursuant to Section 10.6.


                                    ARTICLE V
                            SALE OF DEVELOPMENT SITES

                  5.1 Sale of Development Sites. ShoLodge hereby agrees to cause
the Development Site Subsidiaries, at the Closing and in the manner specified in
Section 5.2 of this Agreement, to sell, convey, transfer, assign and deliver to
Prime, and Prime hereby agrees, at the Closing and in the manner specified in
Section 5.2 of this Agreement, to purchase from the Development Site
Subsidiaries, all right, title and interest of the Development Site Subsidiaries
in and to that certain real property more particularly described on Exhibit D
attached hereto and incorporated herein by this reference (the "Development
Sites").




                                     - 17 -
<PAGE>   18

                  5.2 Transfer of Development Sites. The sale, conveyance,
transfer, assignment and delivery of the Development Sites hereunder will be
effected by the delivery by the Development Site Subsidiaries to Prime at the
Closing of a special warranty deed for each site in the form of Exhibit I
attached hereto and incorporated herein by this reference as to the Mt. Laurel,
New Jersey site and in the form of Exhibit J attached hereto and incorporated
herein by this reference as to the Fairfax County, Virginia site (such deeds
being referred to herein as the "Development Site Transfer Documents"). The
Development Sites shall be transferred free and clear of all Encumbrances, but
subject to the Permitted Exceptions which relate to the Development Sites. From
and after Closing, all liabilities of the Development Site Subsidiaries under
the instruments creating the Permitted Exceptions which relate to the
Development Sites and which first accrue after the Closing Date shall be the
responsibility of Prime.


                                   ARTICLE VI
                                  CONSIDERATION

                  6.1 Purchase Price. The total purchase price for the STI
Assets, the Additional Hotel Operating Assets, the Texas Hotel Operating Assets
and, if applicable, the interest of STI in the Additional Property and the
interest of Southeast in the Texas Property shall be Two Million and No/100
Dollars ($2,000,000.00) (the "Purchase Price"). Prime shall pay or cause a Prime
Subsidiary, as applicable, to pay the Purchase Price on the Closing Date as
follows:

                  (a)      Three Hundred Fifty-Two Thousand Eight Hundred Eighty
                           and No/100 Dollars ($352,880.00) in cash or other
                           immediately available funds, to an account or
                           accounts designated by ShoLodge prior to Closing; and

                  (b)      One Million Six Hundred Forty-Seven Thousand One
                           Hundred Twenty and No/100 Dollars ($1,647,120.00) by
                           the delivery to ShoLodge or to such other Person as
                           designated by ShoLodge of ShoLodge debt securities
                           which are held currently by Prime or an Affiliate of
                           Prime as follows:

                           (1)      Two Hundred Thirty-Eight Thousand and No/100
                                    Dollars ($238,000.00) face value of 9 3/4%
                                    senior subordinated notes at 68% of face
                                    value;

                           (2)      Four Hundred Sixty-One Thousand and No/100
                                    Dollars ($461,000.00) face value of 9.55%
                                    senior subordinated notes at 68% of face
                                    value; and

                           (3)      One Million Eight Hundred Sixty Thousand and
                                    No/100 Dollars ($1,860,000.00) face value of
                                    7 1/2% convertible subordinated debentures
                                    at 63% of face value.

The Purchase Price shall be allocated among the STI Assets, the Additional
Property Operating Assets, the Texas Property Operating Assets and, if
applicable, the interest of STI in the



                                     - 18 -
<PAGE>   19

Additional Property and the interest of Southeast in the Texas Property, as set
forth on Exhibit N attached hereto and made a part hereof.

                  6.2 Development Site Purchase Price. The total purchase price
for the Development Sites shall be Three Million Three Hundred Nineteen Thousand
Nine Hundred Thirty and No/100 Dollars ($3,319,930.00) (the "Development Site
Purchase Price"), which amount shall be payable by Prime to the Development Site
Subsidiaries in cash or other immediately available funds at Closing, One
Million Six Hundred Ninety-Seven Thousand Five Hundred Five and No/100 Dollars
($1,697,505.00) for the Mt. Laurel, New Jersey site and One Million Six Hundred
Twenty-Two Thousand Four Hundred Twenty-Five and No/100 Dollars ($1,622,425.00)
for the Fairfax County, Virginia site.


                                   ARTICLE VII
                              CONSTRUCTION CONTRACT

                  7.1 Construction Contract. At the Closing, Prime shall enter
into, and ShoLodge shall cause Moore to enter into, an agreement (the
"Construction Contract") in form and substance reasonably satisfactory to Prime
and Moore whereby Moore will agree to construct for Prime, and Prime will engage
Moore to construct, an AmeriSuites hotel on each Development Site. The
Construction Contract shall provide for a fixed price of Seventy-Six Thousand
Five Hundred and No/100 Dollars ($76,500.00) per room (including land, building
and furniture, fixtures and equipment). The parties acknowledge that the fixed
price set forth in the preceding sentence includes the cost of acquisition of
the Development Sites, and, thus, the Development Site Purchase Price shall be
deducted from the fixed price otherwise payable to Moore during the course of
construction (as it will already have been paid to the Development Site
Subsidiaries at Closing). Disbursements to Moore of the fixed price less the
Development Site Purchase Price will be paid by Prime monthly during
construction based upon the percentage of completion, subject to retainage of
ten percent (10%). The Construction Contract shall further provide that Moore
shall construct on each Development Site a hotel building in accordance with the
plans and specifications which have been filed by ShoLodge, Moore or the
applicable Development Site Subsidiary with the local building code officials,
but with finishes and signage in accordance with the plans and specifications
described on Exhibit K attached hereto and incorporated herein by this
reference, all in accordance with all applicable laws, regulations, statutes and
orders. The parties acknowledge that the Construction Contract shall contain a
scheduled completion date, together with delay damages, among other terms, which
terms shall be negotiated during the Due Diligence Period. The provisions of
this Section 7.1 shall survive the Closing, but any conflict between the terms
of this Section 7.1 and the terms of the Construction Contract shall be governed
by the Construction Contract.




                                     - 19 -
<PAGE>   20

                                  ARTICLE VIII
                              RESERVATION AGREEMENT

                  8.1 Reservation Agreement. At the Closing, Prime and ShoLodge
shall enter into an agreement (the "Reservation Agreement") in form and
substance reasonably satisfactory to Prime and ShoLodge whereby ShoLodge will
agree to provide to Prime, and Prime will engage ShoLodge to provide, exclusive
reservation services for all proprietary brand hotels owned, operated or
franchised by Prime or any Affiliate of Prime (including the Sumner Suites
hotels acquired by a Prime Subsidiary as contemplated herein, but such Sumner
Suites hotels may be removed from the ShoLodge reservation system upon
conversion to the AmeriSuites brand in Prime's sole discretion if the
Reservation Agreement has not then become effective as described in subparagraph
(d) below). The Reservation Agreement, among other provisions, will contain the
following terms:

                  (a)      The term of the Reservation Agreement will be for
                           five (5) years from the date the Reservation
                           Agreement becomes effective as described in
                           subparagraph (d) below and ShoLodge begins providing
                           reservation services thereunder for all or all but an
                           insignificant number of such proprietary brand hotels
                           owned, operated or franchised by Prime or any
                           Affiliate of Prime, but Prime will have a right to
                           terminate the Reservation Agreement without penalty
                           at any time upon one hundred twenty (120) days prior
                           written notice to ShoLodge, such notice not to be
                           given earlier than the date two (2) years after the
                           Reservation Agreement becomes effective as described
                           in subparagraph (d) below and ShoLodge begins
                           providing reservation services thereunder for all or
                           all but an insignificant number of such proprietary
                           brand hotels owned, operated or franchised by Prime
                           or any Affiliate of Prime; provided, however, in the
                           event any of the Hotels are removed from the ShoLodge
                           reservation system, such two (2) year period during
                           which notice of termination may not be given shall be
                           extended for a period equal to the shorter of (i) the
                           time one (1) or more of the Sumner Suites hotels
                           acquired by a Prime Subsidiary as contemplated herein
                           is not on the ShoLodge reservation system, or (ii)
                           three (3) months.

                  (b)      The Reservation Agreement will provide that Prime
                           will pay a monthly fee to ShoLodge in the amount of
                           one percent (1%) of gross room revenues and will pay
                           customary pass through costs such as commissions and
                           global distribution system fees.

                  (c)      The Reservation Agreement will provide that Prime
                           will have the right of first offer and the right of
                           first refusal with respect to any proposed sale by
                           ShoLodge of the reservation system during the term of
                           the Reservation Agreement.

                  (d)      The Reservation Agreement shall not become effective
                           until the day after (i) ShoLodge has notified Prime
                           that its reservation system complies with




                                     - 20 -
<PAGE>   21

                           the software and hardware requirements set forth on
                           Exhibit Q hereto and incorporated herein by this
                           reference and (ii) Prime has confirmed in writing
                           that the ShoLodge reservation system does so comply,
                           provided that Prime shall have no more than a ninety
                           (90) day period following ShoLodge's notice to test
                           the system and confirm such compliance with whatever
                           tests Prime desires, in Prime's reasonable
                           discretion.

                  (e)      The effective date of the Reservation Agreement must
                           occur within four hundred forty-five (445) days after
                           the date of execution of the Reservation Agreement by
                           ShoLodge and Prime or Prime shall have the option to
                           terminate the Reservation Agreement effective upon
                           written notice thereof to ShoLodge.

                  (f)      The Reservation Agreement shall contain performance
                           standards together with termination rights related
                           thereto.

                  (g)      The Reservation Agreement will provide that Prime
                           shall have the exclusive right to use the Sumner
                           Suites 1-800 number (1-800-74-SUITE) for the one (1)
                           year period commencing on the initial Closing Date
                           under this Agreement, after which time the right of
                           Prime to use such 1-800 number shall terminate;
                           provided, however, during such one (1) year period,
                           Prime shall cause all calls received on such 1-800
                           number which relate to a Hotel then operated by
                           ShoLodge or an Affiliate of ShoLodge to be forwarded
                           to the ShoLodge reservation system. ShoLodge shall
                           reimburse to Prime the actual out of pocket cost to
                           Prime to transfer such calls to the ShoLodge
                           reservation system, not to exceed One Dollar ($1.00)
                           per transferred call.

                  8.2 Termination Fee. Prime shall pay any required termination
fees to cancel its current agreement for reservation services.

                  8.3 Survival. The provisions of Article VIII shall survive the
Closing, but any conflict between the terms of Article VIII and the terms of the
Reservation Agreement shall be governed by the Reservation Agreement.


                                   ARTICLE IX
                    PRICE ADJUSTMENTS; INITIAL CONSIDERATION

                  9.1 Closing Adjustments.

                  (a) The cash portion of the Purchase Price described in
Section 6.1(a) and the Development Site Purchase Price, as applicable, shall be
increased, by:





                                     - 21 -
<PAGE>   22

                      (i) any cash on hand at the Hotels when a Prime Subsidiary
takes possession (any such cash shall be counted by representatives of ShoLodge
and Prime on the Closing Date);

                      (ii) any revenue generated by the operation of the Hotels
through and including the night before the Closing Date arising from accounts
receivable with respect to guests of the Hotels then in occupancy which in the
normal course of business would be received after the Closing (the amount of
such revenue to be determined by representatives of ShoLodge and Prime on the
Closing Date);

                      (iii) amounts paid prior to Closing for any ad valorem
real estate taxes and assessments relating to the Real Property on account of
any period from and after 12:01 a.m. of the Closing Date;

                      (iv) personal property taxes, gross receipts taxes, sales
taxes, excise taxes, hotel occupancy taxes or other similar taxes (but excluding
income and franchise taxes), if any, relating to the Assets paid prior to
Closing on account of any period from and after 12:01 a.m. of the Closing Date;

                      (v) amounts paid prior to Closing under any Operating
Agreement, the HPT Lease (including, if applicable, as amended, or pursuant to
the separate lease contemplated in Section 3.8) or any instrument creating a
Permitted Exception on account of any period from and after 12:01 a.m. of the
Closing Date;

                      (vi) accrued but unpaid interest earnings on the HPT Lease
Guaranty Deposit for any period prior to 12:01 a.m. of the Closing Date (if such
HPT Lease Guaranty Deposit is not returned from HPT and/or Landlord to ShoLodge
or STI);

                      (vii) any utility deposits relating to the Assets which
are transferred and remain on deposit after Closing for the benefit of a Prime
Subsidiary or Prime, as applicable; and

                      (viii) any other charges or fees customarily prorated by a
credit to the seller in the jurisdiction in which the Real Property is situated,
on customary terms.

                  (b) The cash portion of the Purchase Price described in
Section 6.1(a) and the Development Site Purchase Price, as applicable, shall be
decreased, by:

                      (i) any Advance Payments retained by STI, an Additional
Hotel Subsidiary, or Southeast, as applicable;

                      (ii) unpaid ad valorem real estate taxes and assessments
relating to the Real Property on account of any period prior to 12:01 a.m. of
the Closing Date;

                      (iii) unpaid personal property taxes, gross receipts
taxes, sales taxes, excise taxes, hotel occupancy taxes or other similar taxes
(but excluding income and franchise



                                     - 22 -
<PAGE>   23

taxes), if any, relating to the Assets payable on account of any period prior to
12:01 a.m. of the Closing Date;

                      (iv) unpaid amounts payable under any Operating Agreement
(ShoLodge shall use its best efforts to cause all amounts due under the
Operating Agreements to be paid to the Closing Date), the HPT Lease (including,
if applicable, as amended, or pursuant to the separate lease contemplated in
Section 3.8) or any instrument creating a Permitted Exception on account of any
period prior to 12:01 a.m. of the Closing Date (for this purpose "Additional
Rent" (as defined in the HPT Lease) shall be calculated based on the "Total
Hotel Sales" (as defined in the HPT Lease) for the current year to the Closing
Date compared to "Base Total Hotel Sales" (as defined in the HPT Lease) for the
similar period of the applicable "Base Year" (as defined in the HPT Lease)); and

                      (v) unpaid rates, rents and charges for sewer, water, gas,
electricity, telephone and other utility services provided to the Hotels for any
period prior to 12:01 a.m. of the Closing Date (ShoLodge shall use commercially
reasonable efforts to cause meters to be read as of the Closing Date);

                      (vi) accrued but unpaid benefits due to employees of the
Hotels who are hired by Prime or a Prime Subsidiary, as applicable, which are
not paid by STI, ShoLodge or an Affiliate of ShoLodge directly to such employees
upon termination of employment; and

                      (vii) any other charges or fees customarily prorated by a
charge to the seller in the jurisdiction in which the Real Property is situated,
on customary terms.

                  (c) The intent of the foregoing is to credit or charge, as the
case may be, STI, the Additional Hotel Subsidiaries, Southeast or the
Development Subsidiaries, as applicable, with all revenues and expenses
respecting the Assets which are attributable to operations before the Closing
Date and to credit or charge, as the case may be, Prime or a Prime Subsidiary,
as applicable, with all such revenues and expenses attributable to operations on
and after the Closing Date. At Closing, STI, the Additional Hotel Subsidiaries
and Southeast, as applicable, shall provide the Prime HPT Subsidiary and the
Prime Texas Subsidiary, as applicable, with a list setting forth advance guest
bookings, conventions, meetings and any other booking commitments for the period
from and after the Closing Date.

                  9.2 Post-Closing Adjustments. If at any time following the
Closing Date, the calculation of an item listed in Section 9.1 above shall prove
to be incorrect or an item is discovered which should have been included in the
adjustments but which was omitted therefrom, the Person in whose favor the error
or omission was made shall pay the sum necessary to correct such error or
omission to the Person entitled to such payment promptly following receipt of
proof of such error or omission from such Person entitled to such payment,
provided that such proof is delivered to the Person from whom payment is
requested within thirty (30) days of the Closing Date. The adjustment of
"Additional Rent" pursuant to Section 9.1(b)(iv), however, shall be final and
shall not be further adjusted regardless of the actual amount of "Additional
Rent" for the year in which the Closing Date occurs.




                                     - 23 -
<PAGE>   24

                  If the amount of real estate taxes or assessments for the
current year is not known on the Closing Date, then the taxes or assessments
shall be apportioned on the basis of the taxes assessed for the preceding year
or some reasonable assessment agreed by the parties if a Hotel is in its first
year of operation. Notwithstanding the foregoing thirty (30) day limitation, the
amounts as computed shall be adjusted when the final tax assessment and tax
rates are determined.

                  Subject to the limitations set forth herein, the provisions of
this Section 9.2 shall survive the Closing.

                  9.3 Initial Consideration. On the date of execution of this
Agreement by Prime, Prime will deliver to ShoLodge a check in the amount of One
Hundred and No/100 Dollars ($100.00) as initial consideration for any option
granted in this Agreement (the "Initial Consideration"). The Initial
Consideration is non-refundable and shall be retained by ShoLodge regardless of
whether or not this Agreement is terminated pursuant to a right to do so
hereunder.

                                    ARTICLE X
               CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SHOLODGE

                  Each and every obligation of ShoLodge and the ShoLodge
Subsidiaries to be performed hereunder shall be subject to the satisfaction,
prior to or on the date on which performance is due, of the following express
conditions precedent:

                  10.1 Compliance with Agreement. Prime and the Prime
Subsidiaries shall have performed and complied in all respects with all of their
obligations under this Agreement which are to have been performed or complied
with by Prime or the Prime Subsidiaries, as applicable, as of such date.

                  10.2 Representations and Warranties. The representations and
warranties made by Prime in this Agreement shall have been true and correct in
all material respects and such representations and warranties shall be true and
correct in all material respects as of the Closing Date with the same force and
effect as though such representations and warranties had been made on the
Closing Date.

                  10.3 Proceedings and Instruments Satisfactory. All
proceedings, corporate or other, to be taken by Prime or a Prime Subsidiary, as
applicable, in connection with the performance of this Agreement and all Closing
Documents to be executed by Prime and/or a Prime Subsidiary shall be complete to
the reasonable satisfaction of ShoLodge and ShoLodge's attorneys, and Prime and
the Prime Subsidiaries, as applicable, shall have made available to ShoLodge for
examination the originals or true and correct copies of all documents relating
to such proceedings which ShoLodge may reasonably request in connection with the
transactions contemplated by this Agreement.

                  10.4 Deliveries at Closing. Prime and the Prime Subsidiaries,
as applicable, shall have delivered or caused to be delivered to ShoLodge the
Closing Documents to be executed by




                                     - 24 -
<PAGE>   25

Prime and/or a Prime Subsidiary, each properly executed, acknowledged or
notarized, if appropriate, and dated as of the Closing Date or such other date
as the parties shall agree, including, without limitation, the Construction
Contract (in form and substance reasonably satisfactory to Moore and including,
without limitation, those provisions set forth in Section 7.1) and the
Reservation Agreement (in form and substance reasonably satisfactory to ShoLodge
and including, without limitation, those provisions set forth in Section 8.1).

                  10.5 Other Documents. Prime and the Prime Subsidiaries, as
applicable, shall have delivered to ShoLodge or caused to be delivered to
ShoLodge such certificates and documents of officers of Prime and the Prime
Subsidiaries, as applicable, and public officials as shall be reasonably
requested by ShoLodge's counsel to establish the existence and good standing of
Prime and the Prime Subsidiaries, as applicable, and the due authorization and
enforceability of this Agreement and the Closing Documents to be executed by
Prime and/or a Prime Subsidiary, and the authorization of the transactions and
performance contemplated hereby and thereby by Prime and the Prime Subsidiaries.

                  10.6 HPT Closing. All transactions with HPT and Landlord as
contemplated in this Agreement, including, without limitation, the agreement or
consent of Landlord and HPT to the assignment by STI to the Prime HPT Subsidiary
of all of STI's right, title and interest in and to the HPT Lease, the amendment
of the HPT Lease and related documents to reflect the transfer of the STI Leased
Property and, if applicable, the Additional Property (as contemplated in Section
3.8) from STI to the Prime HPT Subsidiary and the change of the brand from
"Sumner Suites" to "AmeriSuites", the release by Landlord of STI of and from any
liability under the HPT Lease and related documents (including, without
limitation, any separate lease as contemplated in Section 3.8), the substitution
of a pledge of the stock of the Prime HPT Subsidiary for the existing pledge of
the stock of STI to Landlord, the release by HPT and Landlord of ShoLodge of and
from any liabilities under the HPT Lease Guaranty and, if applicable, any
separate guaranty (as contemplated in Section 3.8), if applicable, the agreement
or consent of HPT and Landlord to the absolute assignment by ShoLodge to Prime
of all of ShoLodge's right, title and interest in and to the HPT Lease Guaranty
Deposit, the transfer and conveyance of the Additional Property from the
Additional Hotel Subsidiaries to Landlord and, if applicable, the removal of any
Hotel from the HPT Lease or a separate lease (as contemplated in Section 3.8) to
accomplish a partial termination of this Agreement pursuant to Section 13.3 or
Section 13.4 (with minimum annual rent reduced by the applicable amount set
forth in Exhibit C to the HPT Lease or set forth in Exhibit P attached hereto
and incorporated herein by this reference, as applicable), shall have closed
pursuant to documents in form and substance reasonably satisfactory to ShoLodge.
Further, the HPT Estoppel Certificate shall acknowledge that (i) there are no
existing defaults nor events which with the giving of notice or the passage of
time may become defaults by STI under the HPT Lease nor any cause for HPT or
Landlord to offset any obligation of STI under the HPT Lease against the HPT
Lease Guaranty Deposit, and (ii) as of the date of the HPT Estoppel Certificate
the HPT Lease Security Deposit is Twenty-One Million Two Hundred Eighty Thousand
and No/100 Dollars ($21,280,000.00) and the HPT Lease Guaranty Deposit is
Fourteen Million and No/100 Dollars ($14,000,000.00).




                                     - 25 -
<PAGE>   26

                  10.7 Opinions of Counsel. ShoLodge shall have received a
written opinion from counsel to Prime regarding the organization and authority
of Prime and the Prime Subsidiaries, the due execution and delivery of this
Agreement and the Closing Documents by Prime and the Prime Subsidiaries, as
applicable, and such other matters with respect to the transactions contemplated
by this Agreement as ShoLodge may reasonably require, which opinion may have
customary and reasonable assumptions and qualifications.

                  In the event that the conditions to the performance by
ShoLodge and the ShoLodge Subsidiaries have not occurred by the Closing Date,
ShoLodge may terminate this Agreement by delivering written notice to Prime.
Thereafter, Prime and ShoLodge shall be released and relieved of all further
obligations, liabilities and claims hereunder, other than the performance by
each party of its Post Termination Obligations, and, as to a failure or refusal
by Prime to perform Prime's obligations hereunder, other than the right of
ShoLodge to pursue a suit for damages as described in Section 19.5(b)(i).

                                   ARTICLE XI
                CONDITIONS PRECEDENT TO THE OBLIGATIONS OF PRIME

                  Each and every obligation of Prime and the Prime Subsidiaries
to be performed hereunder shall be subject to the satisfaction prior to or on
the Closing Date of the following express conditions precedent:

                  11.1 Compliance with Agreement. ShoLodge and the ShoLodge
Subsidiaries shall have performed and complied in all respects with all of their
obligations under this Agreement which are to have been performed or complied
with by ShoLodge or the ShoLodge Subsidiaries, as applicable, prior to or on
such Closing Date.

                  11.2 Representations and Warranties. The representations and
warranties made by ShoLodge in this Agreement shall have been true and correct
in all material respects and such representations and warranties shall be true
and correct in all material respects as of the Closing Date with the same force
and effect as though such representations and warranties had been made on the
Closing Date.

                  11.3 Proceedings and Instruments Satisfactory. All
proceedings, corporate or other, to be taken by ShoLodge or a ShoLodge
Subsidiary, as applicable, in connection with the performance of this Agreement
and all Closing Documents to be executed by ShoLodge and/or a ShoLodge
Subsidiary shall be complete to the reasonable satisfaction of Prime and Prime's
attorneys, and ShoLodge and the ShoLodge Subsidiaries, as applicable, shall have
made available to Prime for examination the originals or true and correct copies
of all documents relating to such proceedings which Prime may reasonably request
in connection with the transactions contemplated by this Agreement.

                  11.4 Deliveries at Closing. ShoLodge and the ShoLodge
Subsidiaries, as applicable, shall have delivered or caused to be delivered to
Prime the Closing Documents to be



                                     - 26 -
<PAGE>   27

executed by ShoLodge and/or a ShoLodge Subsidiary, each properly executed,
acknowledged or notarized, if appropriate, and dated as of the Closing Date or
such other date as the parties shall agree, including, without limitation, the
Construction Contract (in form and substance reasonably satisfactory to Prime
and including, without limitation, those provisions set forth in Section 7.1)
and the Reservation Agreement (in form and substance reasonably satisfactory to
Prime and including, without limitation, those provisions set forth in Section
8.1.

                  11.5 Other Documents. ShoLodge and the ShoLodge Subsidiaries,
as applicable, shall have delivered to Prime or caused to be delivered to Prime
such certificates and documents of officers of ShoLodge and the ShoLodge
Subsidiaries, as applicable, and public officials as shall be reasonably
requested by counsel to Prime to establish the existence and good standing of
ShoLodge and the ShoLodge Subsidiaries, as applicable, and the due authorization
and enforceability of this Agreement and the Closing Documents to be executed by
ShoLodge and/or a ShoLodge Subsidiary, and the authorization of the transactions
and performance contemplated hereby and thereby by ShoLodge and the ShoLodge
Subsidiaries, as applicable.

                  11.6 HPT Closing. All transactions with HPT and Landlord as
contemplated in this Agreement, including, without limitation, the agreement or
consent of Landlord and HPT to the assignment by STI to the Prime HPT Subsidiary
of all of STI's right, title and interest in and to the HPT Lease, the amendment
of the HPT Lease and related documents (i) to acknowledge the assignment of
STI's interest in the HPT Lease and the STI Leased Property and, if applicable,
the Additional Property (as contemplated in Section 3.8) from STI to the Prime
HPT Subsidiary, (ii) to add the Additional Properties to the properties leased
from Landlord to STI (and the Prime HPT Subsidiary) by the HPT Lease, if
applicable, (iii) to remove any Hotel from the HPT Lease to accomplish a partial
termination of this Agreement pursuant to Section 13.3 or Section 13.4 (with
minimum annual rent reduced by the applicable amount set forth in Exhibit C to
the HPT Lease or set forth in Exhibit P attached hereto and incorporated herein
by this reference, as applicable), (iv) to reflect the change of the brand from
"Sumner Suites" to "AmeriSuites", and (v) to make such other modifications as
Prime or the Prime HPT Subsidiary reasonably may request consistent with the
provisions of this Agreement prior to the expiration of the Due Diligence Period
(such amendment being referred to herein as the "HPT Lease Amendment"), the
substitution of a pledge of the stock of the Prime HPT Subsidiary for the
existing pledge of the stock of STI to Landlord, the transfer and conveyance of
the Additional Property from the Additional Hotel Subsidiaries to Landlord, if
applicable, and, if applicable, the lease by separate document of the Additional
Property from Landlord to the Prime HPT Subsidiary, shall have closed pursuant
to documents in form and substance reasonably satisfactory to Prime. Further,
Prime shall have received the executed HPT Estoppel Certificate which
acknowledges that (i) there are no existing defaults nor events which with the
giving of notice or the passage of time may become defaults by STI under the HPT
Lease nor any cause for HPT or Landlord to offset any obligation of STI under
the HPT Lease against the HPT Lease Guaranty Deposit, and (ii) as of the date of
the HPT Estoppel Certificate the HPT Lease Security Deposit is Twenty-One
Million Two Hundred Eighty Thousand and No/100 Dollars ($21,280,000.00) and the
HPT Lease Guaranty Deposit is Fourteen Million and No/100 Dollars
($14,000,000.00).




                                     - 27 -
<PAGE>   28

                  11.7 Condition of Assets.

                       (a) All of the Assets shall be in substantially the same
physical condition (including, without limitation, with respect to the
environmental condition of the Assets) as on the last day of the Due Diligence
Period, ordinary wear and tear excepted;

                       (b) No material default or event which with the giving of
notice and/or the lapse of time could constitute a material default shall have
occurred and be continuing under any Operating Agreement; and

                       (c) All material licenses, permits and other
authorizations necessary for the current use, occupancy and operation of the
Assets shall be in full force and effect in all material respects, including,
without limitation, any licenses and permits for the sale and on- premises
consumption of liquor and other alcoholic beverages.

                  11.8 Opinions of Counsel. Prime shall have received a written
opinion from counsel to ShoLodge regarding the organization and authority of
ShoLodge and the ShoLodge Subsidiaries, the due execution and delivery of this
Agreement and the Closing Documents by ShoLodge and the ShoLodge Subsidiaries,
as applicable, and such other matters with respect to the transactions
contemplated by this Agreement as Prime may reasonably require, which opinion
may have customary and reasonable assumptions and qualifications.

                  11.9 Security Deposit. Any addition to the HPT Lease Security
Deposit or any "Retained Funds" required to be deposited pursuant to a separate
lease, as applicable, with respect to the lease of the Additional Property from
Landlord to STI or the Prime HPT Subsidiary, as applicable, shall be deposited
by ShoLodge or a ShoLodge Affiliate with Landlord on or prior to the Closing
Date.

                  11.10 Resolution of Prime Objections. ShoLodge shall have
completed, to the reasonable satisfaction of Prime, the resolution of
"unacceptable items" identified pursuant to Sections 12.1 and 12.2 of this
Agreement which ShoLodge undertakes to resolve pursuant to such sections.

                  11.11 Title Policies for Development Sites. A title company
reasonably satisfactory to Prime shall be prepared, subject only to payment of
the applicable premium, endorsement and related fees and delivery of related
conveyance documents in recordable form, to issue title insurance policies
insuring Prime concerning the Development Sites, subject only to the Permitted
Exceptions.

                  In the event that the conditions to the performance by Prime
and the Prime Subsidiaries have not occurred by the Closing Date, Prime may
terminate this Agreement by delivering written notice to ShoLodge. Thereafter,
Prime and ShoLodge shall be released and relieved of all further obligations,
liabilities and claims hereunder, other than the performance by each party of
its Post Termination Obligations and, as to a failure or refusal by ShoLodge to




                                     - 28 -
<PAGE>   29

perform ShoLodge's obligations hereunder, other than the right of Prime to
pursue a suit for damages as described in Section 19.5(a)(i).

                  Further, the obligation of Prime to acquire each Development
Site pursuant to Article V shall be subject to the receipt by Prime prior to or
on the Closing Date for such Development Site of evidence reasonably
satisfactory to Prime that all building permits necessary for the construction
of an AmeriSuites hotel thereon as contemplated in Article VII have been
obtained. In the event that such condition has not been satisfied as to a
Development Site on or before the scheduled (or last possible) Closing Date for
such Development Site, Prime shall have the right to terminate this Agreement as
to such Development Site only by giving written notice to ShoLodge at any time
thereafter, so long as ShoLodge has not satisfied such condition prior to
receipt of Prime's termination notice. In the event Prime timely elects to
terminate this Agreement pursuant to the preceding sentence with respect to a
Development Site, the Development Site Purchase Price shall be reduced by the
portion of the Development Site Purchase Price applicable to such Development
Site as set forth in Section 6.2 and thereafter ShoLodge and Prime shall be
released and relieved of all further obligations, liabilities and claims
hereunder with respect to such Development Site other than the performance by
each party of its Post Termination Obligations with respect to such Development
Site. Such termination shall not affect the rights and obligations of the
parties hereto with respect to the other Assets.

                                   ARTICLE XII
                                  DUE DILIGENCE

                  12.1 Title Policies; Surveys and Environmental Studies; HPT
Documents; Operating Agreements; Operating Permits and Licenses. Prior to the
execution of this Agreement, ShoLodge has delivered to Prime a copy of a title
policy (and all exceptions described therein), survey and environmental study
for each parcel constituting a part of the Real Property, a copy of the HPT
Documents, a copy of all Operating Agreements described on Exhibit L attached
hereto and incorporated herein by this reference and a copy of all certificates
of occupancy and operating permits and licenses relating to the Hotels. In the
event that any matter shown on such title policies, surveys or environmental
studies or any provision of the HPT Documents or any of the Operating Agreements
described on Exhibit L or any matter concerning the Hotels as revealed by an
examination of the certificates of occupancy and the operating permits and
licenses (or lack thereof) is not acceptable to Prime, in Prime's sole judgment,
Prime shall deliver written notice to ShoLodge on or prior to the last day of
the Due Diligence Period specifying in detail all such unacceptable items;
provided, however, that with respect to any of the foregoing items which have
not been delivered to Prime prior to the execution of this Agreement, the
deadline for Prime to deliver such written notice to ShoLodge shall end on the
later of (i) the last day of the Due Diligence Period or (ii) the date ten (10)
days after delivery of such item to Prime. Unless ShoLodge undertakes to resolve
such unacceptable items in a manner acceptable to Prime within five (5) days of
receipt of such notice, Prime may, by delivering written notice to ShoLodge
within five (5) days after the deadline for ShoLodge to undertake to resolve
such unacceptable items, terminate this Agreement, whereupon Prime and ShoLodge
shall be released and relieved of all further obligations, liabilities and
claims hereunder, other than the performance by each party of its Post
Termination Obligations. In the event that the Agreement is not terminated
pursuant to this Section 12.1, Prime shall be deemed to have approved all
exceptions to title as reflected on




                                     - 29 -
<PAGE>   30

the title policies, the condition of the Real Property as reflected by the
surveys and environmental studies, all provisions of the HPT Documents and the
Operating Agreements described on Exhibit L and all matters which would be
revealed by an examination of the operating permits and licenses (but subject to
ShoLodge completing the resolution of the unacceptable items which ShoLodge has
undertaken to resolve).

                  12.2 Property Inspections. Beginning on the Effective Date,
Prime shall have the right to undertake a complete physical examination and
inspection of the Assets and to perform or have performed such engineering and
environmental tests as deemed necessary or appropriate by Prime. ShoLodge will
provide to Prime and its officers and other representatives, during normal
business hours, and with prior notice to ShoLodge, free and full access to the
Hotels and the other Assets to conduct such examinations and inspections and
will cooperate fully with any examination or inspection made by Prime, its
officers or representatives. All examinations and inspections shall be conducted
at such times and in such a manner as to minimize the disruption to the business
being conducted on the Real Property. ShoLodge shall also request that HPT
forward to Prime a copy of all examinations and inspections which HPT obtained
with respect to the Existing HPT Hotels or hereafter obtains with respect to the
Additional HPT Hotels. Should Prime discover any physical condition of the
Assets (including, without limitation, any environmental condition) which is not
acceptable to Prime and which is not eligible to be repaired with funds in the
"FF&E Reserve" established under the HPT Lease or the Texas Lease or a similar
fund created under a separate lease contemplated in Section 3.3 and in Section
3.8, as applicable, Prime shall deliver written notice to ShoLodge on or prior
to the last day of the Due Diligence Period specifying in detail all such
unacceptable items; provided, however, that with respect to any of the foregoing
examinations and inspections obtained by HPT with respect to the Existing HPT
Hotels or the Additional HPT Hotels, the deadline for Prime to deliver such
written notice to ShoLodge shall end on the later of (i) the last day of the Due
Diligence Period or (ii) the date ten (10) days after delivery of such item to
Prime or (iii) thirty (30) days after receipt by Prime of written notice from
HPT or ShoLodge that any such examinations and inspections obtained by HPT will
not be provided to Prime. Unless ShoLodge undertakes to repair such unacceptable
items in a manner acceptable to Prime within five (5) days of receipt of such
notice, Prime may, by delivering written notice to ShoLodge within five (5) days
after the deadline for ShoLodge to undertake to repair such unacceptable items,
terminate this Agreement, whereupon Prime and ShoLodge shall be released and
relieved of all further obligations, liabilities and claims hereunder, other
than the performance by each party of its Post Termination Obligations. In the
event that the Agreement is not terminated pursuant to this Section 12.2, Prime
shall be deemed to have approved the physical condition of the Assets as in
existence on the last day of the Due Diligence Period (but subject to ShoLodge
completing the repair of the unacceptable items which ShoLodge has undertaken to
repair).

                  12.3 Confidentiality. All materials delivered to Prime and all
results, information and reports generated from Prime's examinations and
inspections of the Assets shall be held in strict confidence and no copies of
such materials, results, information or reports shall be given to anyone (other
than employees, agents, attorneys and accountants of Prime who shall also agree
to keep such results, information and reports confidential) without the prior
written approval of ShoLodge. The provisions of this Section 12.3 shall survive
any termination of this Agreement.




                                     - 30 -
<PAGE>   31

                                  ARTICLE XIII
                       CERTAIN MATTERS PENDING THE CLOSING

                  13.1 Notice of Adverse Changes. Pending the Closing Date,
ShoLodge shall give to Prime prompt notice of the occurrence of any of the
following:

                       (a) the commencement or threat of commencement of any
proceeding at law or in equity or before any agency or administrative or
regulatory body or authority which could have a material adverse effect on any
of the Hotels or the operation of any of the Hotels;

                       (b) any notice of breach, default, claimed default or
termination of the HPT Lease or any Operating Agreement;

                       (c) any violation by STI, an Additional Hotel Subsidiary
or Southeast, as applicable, or notice of any alleged violation by STI, an
Additional Hotel Subsidiary or Southeast, as applicable, of any federal, state
or local law, statute, ordinance, rule or regulation, but only as relates to the
operation of the Hotels; or

                       (d) any material change in any condition with respect to
any of the Assets or any event or circumstance which makes any representation or
warranty of ShoLodge to Prime under this Agreement untrue or misleading in any
material respect (Prime agreeing, on learning of any such fact or condition,
promptly to notify ShoLodge thereof).

                  13.2 Operations Pending Closing. Pending the Closing Date,
STI, the Additional Hotel Subsidiaries and Southeast, as applicable, shall,
unless otherwise approved in writing by Prime:

                       (a) operate the Hotels in the ordinary course of business
of a first class hotel operation and in accordance with past practices
consistently applied so as to keep the Hotels in first class condition,
reasonable wear and tear excepted, and so as to maintain a first class hotel
operation and the reasonable goodwill of all tenants of the Hotels and all
employees, guests and other customers of the Hotels;

                       (b) maintain the Equipment in good operating condition
and repair and replace with equipment of similar value which is in good
operating condition or repair any of the Equipment which shall be worn out,
lost, stolen or destroyed (which maintenance, repair and replacement as to the
STI Equipment and, if applicable, the Additional Equipment may be made from
funds in the "FF&E Reserve" created pursuant to the HPT Lease or any separate
lease as contemplated in Section 3.8);

                       (c) not sell, lease, mortgage, pledge or otherwise
dispose of any of the Assets or any portion thereof, except for dispositions
contemplated in this Agreement and dispositions in the ordinary course of
business;




                                     - 31 -
<PAGE>   32

                       (d) with respect to the personnel employed at the Hotels,
(i) not increase or otherwise change the rate or nature of the compensation
(including wages, salaries and bonuses) which is paid or payable to any such
employee other than in the ordinary course of business, and (ii) use reasonable
efforts to keep available to the applicable Prime Subsidiary the services of the
present employees at the Hotels (except those dismissed for cause or those who
voluntarily discontinue their employment);

                       (e) not (i) enter into or become obligated under any
Operating Agreement except for normal contracts entered into in the ordinary
course of business which can be terminated upon not more than thirty (30) days
notice without penalty and, if the party thereto delivering goods or performing
services is an Affiliate of ShoLodge, which contain fair market terms, or (ii)
in any manner change, modify, extend or renew any existing Operating Agreement
unless such Operating Agreement can be terminated upon not more than thirty (30)
days notice without penalty and, if the party thereto delivering goods or
performing services is an Affiliate of ShoLodge, unless such changes,
modifications, extensions or renewals are at fair market terms;

                       (f) maintain the Inventory in good condition and in
amount in accordance with past practices consistently applied (but as to bath
towels, hand towels, wash cloths, bath mats, sheets and pillow cases not less
than two (2) "turns" (as such term is used in the hotel industry) and as to
other linen items such as blankets, pillows and bed spreads, not less than one
(1) "turn" plus appropriate spare inventory of such other linen items);

                       (g) maintain in full force and effect policies of
liability and casualty insurance of the same type, character and coverage as the
policies currently carried with respect to the Assets and as required under the
HPT Lease or any separate lease as contemplated in Section 3.8;

                       (h) not in any manner change, modify, extend, renew or
terminate the HPT Lease, except as required by the terms thereof or except as
expressly permitted by this Agreement;

                       (i) maintain its books of account and records relating to
the Assets in accordance with sound accounting principles;

                       (j) use and operate the Hotels in compliance in all
material respects with applicable laws, statutes, rules and regulations and the
requirements of any mortgage, lease, Operating Agreement, Permitted Exception
and insurance policy affecting the Hotels or any Assets;

                       (k) pay or cause to be paid prior to delinquency all ad
valorem, occupancy and sales taxes due and payable with respect to any Asset or
the operation of the Hotels or establish or cause to be established adequate
reserves therefor;

                       (l) except as otherwise permitted hereby, not take any
action or fail to take action the result of which would have a material adverse
effect on an Asset or on the ability



                                     - 32 -
<PAGE>   33

of the applicable Prime Subsidiary to operate the Hotels as first class hotels
after the Closing Date or which would cause any of the representations and
warranties contained in Article XV hereof to be untrue in any material respect
as of Closing;

                       (m) maintain the Buildings (including, but not limited
to, the mechanical systems, plumbing, electrical, wiring, appliances, fixtures,
heating, air conditioning and ventilating equipment, elevators, boilers,
equipment, roofs, structural members and furnaces) in substantially the same
condition as they are as of the last day of the Due Diligence Period, reasonable
wear and tear excepted (which maintenance as to the STI Buildings and, if
applicable, the Additional Buildings, may be made from funds in the "FF&E
Reserve" created pursuant to the HPT Lease or any separate lease as contemplated
in Section 3.8);

                       (n) not materially diminish the quality or quantity of
maintenance and upkeep services heretofore provided to the Assets;

                       (o) continue to use reasonable efforts to take guest room
reservations and to book functions and meetings and otherwise to promote the
business of the Hotels in accordance with current practices and at current
rates; provided, however, no such bookings shall be for more than six (6) months
in advance without the consent of Prime;

                       (p) promptly deliver to Prime upon Prime's request such
reports showing the revenue and expenses of the Hotels and all departments
thereof, together with such periodic information with respect to room
reservations and other bookings, as ShoLodge customarily keeps or receives
internally for its own use; and

                       (q) keep, observe and perform all its obligations in all
material respects under the HPT Lease, the Operating Agreements and all material
licenses, permits and other authorizations necessary for the current use,
occupancy and operation of the Assets, including, without limitation, any
licenses and permits for the sale and on-premises consumption of liquor and
other alcoholic beverages, consistent with ShoLodge's past practice.

                  13.3 Destruction of Assets. If prior to the Closing Date, any
Hotel suffers loss or damage on account of fire, flood, earthquake, accident,
act of war, civil commotion or other similar cause or event occurring after the
Effective Date such that STI has the right to terminate the HPT Lease as to such
Hotel or would have such right if such Hotel were leased by STI pursuant to the
HPT Lease and ShoLodge has not repaired such damage prior to the Closing Date,
Prime shall have the right to terminate this Agreement as to such damaged Hotel
(and the Assets related thereto) only by giving written notice to ShoLodge on or
prior to the Closing Date, in which event (i) the Purchase Price shall be
reduced by the applicable amount as reflected on Exhibit O attached hereto and
incorporated herein by this reference, (such reduction to come first from the
cash portion of the Purchase Price described in Section 6.1(a) and then from the
ShoLodge debt securities described in Section 6.1(b)) and Exhibit N shall be
appropriately modified, and (ii) if applicable, the "minimum annual rent"
described in Section 3.3 and in Section 4.3 shall be reduced by the applicable
amount as specified on Exhibit P attached hereto and incorporated herein by this
reference (as adjusted, if applicable, pursuant to Section 3.3 and




                                     - 33 -
<PAGE>   34
Section 4.3). If Prime fails to terminate this Agreement as to a damaged Hotel
(and the Assets related thereto) by giving timely written notice of termination
as provided herein or if a Hotel is damaged but the damage is such that Prime
does not have an option to terminate this Agreement as to such damaged Hotel
(and the Assets related thereto), Prime shall consummate the transactions
contemplated hereunder (including, without limitation, as contemplated herein
with respect to such damaged Hotel (and the Assets related thereto)), in which
event the applicable Prime Subsidiary, except as otherwise provided in the HPT
Lease (or a separate lease contemplated in Section 3.8, if applicable), shall be
entitled to all insurance or other proceeds payable by reason of such loss or
damage to such damaged Hotel in excess of the amount spent by ShoLodge or a
ShoLodge Subsidiary to repair such damage (insurance or other proceeds in such
amount being payable to ShoLodge or such ShoLodge Subsidiary), and, in addition,
there shall be a reduction in the Purchase Price by the amount by which any
deductibles under the policies of insurance covering such loss or damage exceed
the amount spent by ShoLodge or a ShoLodge Subsidiary to repair such damage
which is not reimbursed from insurance or other proceeds. ShoLodge shall not
permit STI to terminate the HPT Lease or the separate lease contemplated in
Section 3.8 due to any casualty without the prior written approval of Prime,
such written approval not to be unreasonably withheld, delayed or conditioned.
In the event of a casualty to an Existing HPT Hotel or to an Additional HPT
Hotel such that Prime elects to terminate this Agreement as to such Hotel,
ShoLodge agrees that, at Prime's request, ShoLodge shall cause STI to terminate
the HPT Lease or the separate lease contemplated in Section 3.8 with respect to
such Hotel pursuant to the provisions thereof. Further, prior to commencing the
repair of any damage following a casualty event which would cost more than Two
Hundred Fifty Thousand and No/100 Dollars ($250,000.00) in the aggregate to
repair, ShoLodge shall cause STI to obtain the prior written consent of Prime,
not to be unreasonably withheld, conditioned or delayed, to such repair.

                  In the event Prime timely elects to terminate this Agreement
pursuant to the preceding paragraph with respect to a damaged Hotel (and the
Assets related thereto), thereafter, ShoLodge and Prime shall be released and
relieved of all further obligations, liabilities and claims hereunder with
respect to such damaged Hotel (and the Assets related thereto), other than the
performance by each party of its Post Termination Obligations with respect to
such damaged Hotel (and the Assets related thereto). Such termination shall not
affect the rights and obligations of the parties hereto with respect to the
other Assets.

                  13.4 Condemnation. In the event of any actual or threatened
taking pursuant to the power of eminent domain of all or any portion of any HPT
Real Property or the Texas Real Property such that STI has the right to
terminate the HPT Lease as to such HPT Real Property or would have such right if
such HPT Real Property or such Texas Real Property were leased by STI pursuant
to the HPT Lease or any Development Site such that the taking would materially
adversely affect the operation of the hotel to be constructed on such property,
as applicable, or any proposed sale in lieu thereof, ShoLodge shall give written
notice thereof to Prime promptly after ShoLodge learns or receives notice
thereof, and Prime shall have the right to terminate this Agreement as to such
HPT Real Property or such Texas Real Property (and the Assets related thereto)
or as to such Development Site, as applicable, only by giving written notice to
ShoLodge on or prior to the date ten (10) days after receipt of such written
notice from ShoLodge, in which




                                     - 34 -
<PAGE>   35
event (i) if applicable, the Purchase Price shall be reduced by the applicable
amount as reflected on Exhibit O attached hereto and incorporated herein by this
reference (such reduction to come first from the cash portion of the Purchase
Price described in Section 6.1(a) and then from the ShoLodge debt securities
described in Section 6.1(b)) and Exhibit N shall be appropriately modified, (ii)
if applicable, the Development Site Purchase Price shall be reduced by the
portion of the Development Site Purchase Price applicable to such Development
Site as set forth in Section 6.2, and (iii) if applicable, the "minimum annual
rent" in Section 3.3 and in Section 4.3 shall be reduced by the applicable
amount as specified on Exhibit P attached hereto and incorporated herein by this
reference (as adjusted, if applicable, pursuant to Section 3.3 and Section 4.3).
If Prime fails to terminate this Agreement as to any such HPT Real Property or
any such Texas Real Property (and the Assets related thereto) or as to any such
Development Site, as applicable, by giving timely written notice of termination
as provided herein or if the taking or threatened taking of such HPT Real
Property, Texas Real Property or Development Site, as applicable, is such that
Prime does not have an option to terminate this Agreement as to such HPT Real
Property or such Texas Real Property (and the Assets related thereto) or as to
such Development Site, as applicable, Prime shall consummate the transactions
contemplated hereunder (including, without limitation, as contemplated herein
with respect to such HPT Real Property or such Texas Real Property (and the
Assets related thereto) or such Development Site, as applicable), in which event
the applicable Prime Subsidiary or Prime, as applicable, except as otherwise
provided in the HPT Lease (or a separate lease contemplated in Section 3.8 if
applicable), shall be entitled to all proceeds, awards and other payments
arising out of such condemnation or sale (actual or threatened), but there shall
be no reduction in the Purchase Price. ShoLodge shall not permit STI to
terminate the HPT Lease or the separate lease contemplated in Section 3.8 due to
any taking pursuant to the power of eminent domain without the prior written
approval of Prime, such written approval of Prime not to be unreasonably
withheld, delayed or conditioned. In the event of a taking with respect to any
HPT Real Property, ShoLodge agrees that, at Prime's request, ShoLodge shall
cause STI to terminate the HPT Lease or the separate lease contemplated in
Section 3.8 with respect to such HPT Real Property pursuant to the provisions
thereof.

                  In the event Prime timely elects to terminate this Agreement
pursuant to the preceding paragraph with respect to any HPT Real Property or any
Texas Real Property (and the Assets related thereto) or a Development Site, as
applicable, thereafter, ShoLodge and Prime shall be released and relieved of all
further obligations, liabilities and claims hereunder with respect to such HPT
Real Property or such Texas Real Property (and the Assets related thereto), or
such Development Site, as applicable, other than the performance by each party
of its Post Termination Obligations with respect to such HPT Real Property or
such Texas Real Property (and the Assets related thereto) or such Development
Site, as applicable. Such termination shall not affect the rights and
obligations of the parties hereto with respect to the other Assets.




                                     - 35 -
<PAGE>   36

                                   ARTICLE XIV
                          POST TERMINATION OBLIGATIONS

                  14.1 Post Termination Obligations. All costs and expenses
related to Prime's examination and inspection of the Assets shall be paid for by
Prime, and Prime agrees to indemnify and hold ShoLodge and the ShoLodge
Subsidiaries harmless from and against all such costs and expenses. Prime shall
not permit any liens to attach to the Assets by reason of the exercise of
Prime's inspection rights hereunder. Prime agrees that if this Agreement is
terminated for any reason, Prime will: (i) restore the Assets to the condition
which existed prior to any inspections, tests or other activities of Prime
(casualty, condemnation, ordinary wear and tear and acts or omissions of
ShoLodge or its Affiliates excepted); (ii) indemnify and hold ShoLodge and the
ShoLodge Subsidiaries harmless from and against any and all liens by
contractors, subcontractors, materialmen or laborers performing work or tests
for Prime and from and against any and all claims for damages by third parties
for damage to property or personal injuries to the extent arising out of or
attributable to the conduct of such work and tests and/or any other activities
of Prime or Prime's employees or agents; (iii) pay or reimburse ShoLodge and the
ShoLodge Subsidiaries for the payment of any expenses (including reasonable
attorney fees and court costs) incurred in connection with any of the foregoing;
and (iv) deliver to ShoLodge copies of all studies, reports, surveys, tests and
other materials of any kind or nature generated for or by Prime in connection
with Prime's inspection of the Assets. The foregoing obligations of Prime,
together with Prime's obligation to maintain the confidentiality of certain
matters as specified in Section 12.3, the obligation of each party to maintain
the confidentiality of certain matters as specified in Section 20.1 and the
obligation of each party with respect to costs and expenses set forth in Section
17.5, are referred to herein collectively as the "Post Termination Obligations."
Notwithstanding any provision herein to the contrary, it is agreed and
understood that a termination of this Agreement under any right granted
hereunder shall terminate all obligations of ShoLodge and Prime under this
Agreement except that such termination shall not terminate the provisions in
this Agreement relating to the Post Termination Obligations and except that any
termination due to the failure or refusal of a party to perform its obligations
hereunder shall not terminate the right of the other party hereto to pursue a
suit to recover damages in accordance with the provisions of Section 19.5(a)(i)
or Section 19.5(b)(i), as applicable. The Post Termination Obligations shall
survive any termination of this Agreement, and the right to pursue a suit to
recover damages in accordance with the provisions of Section 19.5(a)(i) and
Section 19.5(b)(i) shall survive any termination due to the failure or refusal
of a party to perform its obligations hereunder. Further, the obligations of
Prime set forth in (ii) and (iii) of the third sentence of this Section 14.1
shall survive the Closing.


                                   ARTICLE XV
                   REPRESENTATIONS AND WARRANTIES OF SHOLODGE

                  ShoLodge hereby represents and warrants to Prime and to the
Prime Subsidiaries, as follows:




                                     - 36 -
<PAGE>   37

                  15.1 Organization. ShoLodge is a corporation duly organized,
validly existing and in good standing under the laws of the State of Tennessee
and has the corporate power and authority to enter into and to perform this
Agreement and the Closing Documents to which ShoLodge is a party. Each ShoLodge
Subsidiary is a corporation duly organized, validly existing and in good
standing under the laws of the State of Tennessee and has the corporate power
and authority to perform its obligations as contemplated in this Agreement and
to enter into and to perform the Closing Documents to which each such ShoLodge
Subsidiary is a party. ShoLodge and each ShoLodge Subsidiary have duly qualified
to transact business in each jurisdiction in which the nature of the business
conducted by it requires such qualification, except where failure to do so could
not reasonably be expected to have a material adverse effect.

                  15.2 Authorization. The execution and delivery of this
Agreement by ShoLodge, the execution and delivery of all Closing Documents to be
executed by ShoLodge, and the consummation by ShoLodge of the transactions
contemplated hereby and thereby have been duly authorized by the Board of
Directors of ShoLodge. The execution and delivery of all Closing Documents to be
executed by a ShoLodge Subsidiary, as applicable, and the consummation by each
ShoLodge Subsidiary, as applicable, of the transactions contemplated hereby and
thereby have been duly authorized by each such corporation's Board of Directors.
Neither the entering into this Agreement and the Closing Documents to be
executed by ShoLodge or a ShoLodge Subsidiary, as applicable, nor the
consummation of the transactions contemplated herein or therein will cause a
violation, default or breach by ShoLodge or a ShoLodge Subsidiary, as
applicable, of, or conflict with, any contracts, agreements or instruments to
which ShoLodge or a ShoLodge Subsidiary, as applicable, is a party or by which
ShoLodge or a ShoLodge Subsidiary, as applicable, is bound.

                  15.3 Valid and Binding Agreement. This Agreement constitutes,
and each of the Closing Documents to be executed by ShoLodge or a ShoLodge
Subsidiary, as applicable, will constitute upon execution by all parties
thereto, a valid and binding agreement of ShoLodge and the ShoLodge Subsidiaries
who are parties thereto, as applicable, enforceable in accordance with its
terms, subject as to enforceability to bankruptcy, insolvency and similar laws
affecting creditors' rights generally and to the availability of equitable
remedies.

                  15.4 No Violation. Neither the execution and delivery of this
Agreement, the execution and delivery of the Closing Documents to be executed by
ShoLodge or a ShoLodge Subsidiary, as applicable, nor the consummation by
ShoLodge and the ShoLodge Subsidiaries, as applicable, of the transactions
contemplated hereby or thereby violates or conflicts with any such corporation's
Charter or Bylaws or any agreement or other restriction of any kind to which any
such corporation is as a party or by which any such corporation is bound.

                  15.5 Employment Issues. The employees at the Hotels are not
represented by any union and, to the knowledge of ShoLodge, have not been
solicited with respect to organization or representation by any labor
organization or similar body. There are no employment agreements or other labor
agreements with respect to any employees at the Hotels. Except as set forth on
Exhibit M attached hereto and incorporated herein by this reference, there is
not any "employee benefit plan" as defined in ss. 3(3) of the Employment
Retirement Income Security Act of 1974,



                                     - 37 -
<PAGE>   38

as amended ("ERISA"), nor any stock purchase plan, practice or arrangement, nor
any other material benefits, practice or arrangement relating to employees at
the Hotels (each such plan, practice or arrangement being referred to as a
"Benefit Plan"). ShoLodge is not currently required to contribute to any
multi-employer plans (as defined within the meaning of ss. 3(37) of ERISA) for
the benefit of the employees of any Hotel, nor has ShoLodge been required to
contribute to any multi-employer plans (as defined within the meaning of ss.
3(37) of ERISA) for the benefit of the employees at the Hotels, nor has ShoLodge
been required to contribute to any multi-employer plan for the benefit of the
employees at the Hotels within the last five (5) years. With respect to each
Benefit Plan set forth on Exhibit M, if any, ShoLodge has furnished Prime, to
the extent applicable to each Benefit Plan (i) complete and accurate copies of
the Benefit Plan, including all amendments, (ii) the most recent determination
letter from the Internal Revenue Service, (iii) the most recent actuarial
reports, and (iv) all reports of the Benefit Plan required by ERISA and the
regulations thereunder. The execution and delivery of this Agreement by ShoLodge
and the consummation of the transactions contemplated hereunder (x) do not
constitute a prohibited transaction within the meaning of ss. 406 of ERISA or
ss. 4975 of the Code, and (y) will not result in any obligation or liability of
Prime or ShoLodge to the Pension Benefit Guaranty Corporation in respect of any
Benefit Plan.

                  15.6 Site Disclosure.

                  (a) To the knowledge of ShoLodge, there is no pending or
threatened condemnation or similar proceeding affecting the Real Property or any
portion thereof, and to the knowledge of ShoLodge, no such action is presently
contemplated.

                  (b) To the knowledge of ShoLodge (i) all necessary permits and
licenses required for the operation of the Hotels have been obtained, and (ii)
no zoning, building or other federal, state or municipal law, ordinance,
regulation or restriction is violated by the continued operation of the Hotels
in the manner now being operated. No notice of zoning or building code
violations resulting from the improvements on the HPT Real Property or the Texas
Real Property or the continued operation of the Hotels thereon has been received
by ShoLodge.

                  (c) To the knowledge of ShoLodge and except as disclosed in
any environmental studies obtained by Prime or provided by ShoLodge to Prime,
(i) the Hotels have been operated in compliance with all environmental
regulations, and (ii) no pollutants or other toxic or hazardous substances,
including any solid, liquid, gaseous or thermal irritant or contaminant, such as
smoke, vapor, soot, fumes, alkalis, acids, chemicals or wastes, have been
stored, discharged, released, generated or allowed to escape at or from the Real
Property in violation of any environmental regulations, (iii) no underground
storage tanks are located on the Real Property or have been removed or filled,
and (iv) no investigation, administrative order, consent order or agreement,
litigation or settlement with respect to any of the foregoing is proposed,
threatened, anticipated or in existence with respect to the Real Property.
ShoLodge has not received any notice of any such investigation, administrative
order, consent order or agreement, litigation or settlement.




                                     - 38 -
<PAGE>   39

                  (d) To the knowledge of ShoLodge, there are no structural,
electrical, mechanical, plumbing or other defects in any of the Hotels which
could have a material adverse effect on the operation of such Hotel.

                  15.7 Operating Agreements. Attached hereto as Exhibit L is a
schedule of all Operating Agreements in effect as of the Effective Date. There
are no material management, service, supply or maintenance contracts or
equipment leases or similar contracts or agreements in effect as of the
Effective Date with respect to the Assets other than the Operating Agreements
listed on Schedule L attached hereto and incorporated herein by this reference.
The copies of the Operating Agreements previously provided or made available to
Prime are true and complete copies of said Operating Agreements and, to
ShoLodge's knowledge, are valid and in full force and effect and no party has
breached any material condition or provision thereof. To ShoLodge's knowledge,
ShoLodge or the applicable ShoLodge Subsidiary has performed all of its material
obligations under each of the Operating Agreements. To ShoLodge's knowledge no
fact or circumstance has occurred which, by itself or with the passage of time
or the giving of notice or both, would constitute a default in any material
respect under any of the Operating Agreements. To ShoLodge's knowledge, all
other parties to the Operating Agreements have performed all of their
obligations thereunder in all material respects and are not in default
thereunder in any material respect. Except as set forth on Exhibit L or
disclosed to Prime, ShoLodge has received no notice of any intention of any of
the parties to any of the Operating Agreements to cancel the same, nor has
ShoLodge or the applicable ShoLodge Subsidiary canceled any of same.

                  15.8 Equipment. To the knowledge of ShoLodge, each item of
Equipment is in good operating condition and repair.

                  15.9 Brokers Fees. No brokers, finders or similar agents
acting on behalf of ShoLodge are entitled to any brokerage commission, finder's
fee or any similar compensation in connection with this Agreement or the
transactions contemplated hereby.

                  15.10 Litigation. ShoLodge has not received any written notice
of and, to ShoLodge's knowledge, no action or proceeding is pending or
threatened and no investigation looking toward such an action or proceeding has
begun, which (a) questions the validity of this Agreement or the HPT Lease or
any action taken or to be taken pursuant hereto, (b) will result in any material
adverse change in the business, operation, affairs or condition of any of the
Hotels, (c) will result in or subject any Asset to a material liability, or (d)
involves condemnation or eminent domain proceedings against any part of the
Assets.

                  15.11 Booking Agreements. All bookings of guest rooms and
meeting rooms which will be binding on a Prime Subsidiary subsequent to the
Closing Date were entered into in the ordinary course of business consistent
with past practice.

                  15.12 HPT Documents. The copy of the HPT Documents previously
provided or made available to Prime is a full and complete copy of the HPT
Documents and, to ShoLodge's knowledge, the HPT Documents are valid and in full
force and effect and no party has breached any material condition or provision
thereof, including, without limitation, as to STI, the provisions




                                     - 39 -
<PAGE>   40

of Section 9.1 of the HPT Lease concerning required insurance. To ShoLodge's
knowledge, STI has performed all of its material obligations under the HPT
Lease. To ShoLodge's knowledge no fact or circumstance has occurred which, by
itself or with the passage of time or the giving of notice or both, would
constitute a default in any material respect under the HPT Lease. To ShoLodge's
knowledge, Landlord has performed all of its obligations under the HPT Lease in
all material respects and is not in default thereunder in any material respect.
STI has not prepaid rent or additional rent or any other items under the HPT
Lease for more than one (1) month in advance.

                  15.13 Not A Foreign Person. Neither ShoLodge nor any ShoLodge
Subsidiary is a "foreign person" within the meaning of Section 1445 of the Code.

                  15.14 Insurance. ShoLodge has not received any written notice
from any insurance carrier of defects or inadequacies in any Asset which, if
uncorrected, would result in a termination of insurance coverage or a material
increase in the premiums charged therefor.

                  15.15 Adjacent Land. No land or facilities adjacent to any of
the Hotels is used in the operation of the Hotels except for access, parking and
utility easements as reflected in the title documents previously provided by
ShoLodge to Prime.

                  15.16 Trademarks. ShoLodge has received no written notice that
the use of the "Sumner Suites" trademark or tradename is in violation of any
trademark or tradename owned by any other Person, except for claims resolved in
favor of ShoLodge by final order.

                  15.17 Compliance with Laws. To ShoLodge's knowledge, each
Asset is in compliance in all material respects with all laws of governmental
authorities which are applicable to the Asset or the use or operation of such
Asset.

               15.18 Taxes. In connection with the ownership and operation of
each Asset, to ShoLodge's knowledge, ShoLodge or a ShoLodge Subsidiary, as
applicable, has filed or will timely file all required federal, state and local
income, withholding, unemployment, FICA, excise, franchise, gross receipts,
property, sales, resort, use, occupancy and other tax returns either when due or
not later than the end of applicable extension periods. All taxes which have
become due and payable or may become due and payable prior to or after the
Closing on account of the Assets or the operation of the Hotels prior to the
Closing Date have been paid or will be paid when due, except liens for real
estate taxes which are not delinquent or which are being contested in good faith
or as to which adequate reserves are provided therefor (and none of such taxes
shall be assumed by Prime except to the extent the Purchase Price or the
Development Site Purchase Price is decreased for such taxes pursuant to Section
9.1(b)). After the Closing and except as contemplated to the contrary in the
preceding sentence, there shall be no liens on any of the Assets by reason of
any taxes payable on or before the Closing Date or pertaining to periods ending
on or before the Closing Date. To ShoLodge's knowledge, other than the amounts
disclosed by tax bills, no taxes or special assessments of any kind (special,
bond or otherwise) are or have been levied with respect to any of the Assets, or
any portion thereof, which are outstanding or unpaid,



                                     - 40 -
<PAGE>   41

other than amounts not yet due and payable or, if due and payable, not yet
delinquent or as to which adequate reserves are provided therefor.

                  15.19 Financial Information. All of ShoLodge's financial
information, including, without limitation, all books and records and financial
statements previously furnished to Prime ("Financial Information") is to
ShoLodge's knowledge true and correct in all material respects and presents
accurately the results of the operations of the Hotels for the periods indicated
and has been prepared in accordance with generally accepted accounting
principles. Since the date of the last financial statement included in
ShoLodge's Financial Information, there has been no material adverse change in
the financial condition or in the operations of the Hotels.

                  15.20 Leases. There are no leases, subleases, licenses or
other lettings of space within a Hotel that will remain in existence after the
Closing Date other than (i) the rights of guests in occupancy and the holders of
reservations for future occupancy of guest rooms or meeting rooms, (ii) the
rights set forth in the Operating Agreements, and (iii) the rights of the owner
of record of any license or permit for the sale and on-premises consumption of
liquor and other alcoholic beverages (which license shall remain in effect to
the extent contemplated in Section 18.1).

                  15.21 HTP Lease Security Deposit/HPT Lease Guaranty Deposit.
The amount of the HPT Lease Security Deposit is Twenty-One Million Two Hundred
Eighty Thousand and No/100 Dollars ($21,280,000.00). The amount of the HPT Lease
Guaranty Deposit is Fourteen Million and No/100 Dollars ($14,000,000.00).

                  When used herein the words "to the knowledge of ShoLodge" or
words of similar effect mean the actual knowledge of the current officers of
ShoLodge, without independent inquiry.

                  Prime acknowledges that Prime has not entered into this
Agreement based upon any representation, warranty, agreement, statement or
expression of opinion by ShoLodge or by any Person acting or allegedly acting
for or on behalf of ShoLodge as to the Assets or the condition of the Assets
(other than any warranty of title set out in the Closing Documents and other
than the representations and warranties specifically set forth in Article XV
hereof). Prime agrees that the Assets to be sold or leased to Prime or a Prime
Subsidiary hereunder are to be sold or leased to and accepted by Prime or a
Prime Subsidiary at Closing, AS IS, WHERE IS, WITH ALL FAULTS, IF ANY, AND
WITHOUT ANY REPRESENTATIONS OR WARRANTIES WHATSOEVER, EXPRESS OR IMPLIED (other
than (i) any warranty of title set out in the Closing Documents, (ii) the
representations and warranties specifically set forth in Article XV hereof, and
(iii) the obligation of ShoLodge to complete the "unacceptable items" identified
pursuant to Sections 12.1 and 12.2 of this Agreement which ShoLodge undertakes
to resolve pursuant to such sections).



                                     - 41 -
<PAGE>   42

                                   ARTICLE XVI
                     REPRESENTATIONS AND WARRANTIES OF PRIME

               Prime hereby represents and warrants to ShoLodge and to the
ShoLodge Subsidiaries, as follows:

               16.1 Organization. Prime is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
the corporate power and authority to enter into and to perform this Agreement
and the Closing Documents to which Prime is a party. Each Prime Subsidiary is,
or prior to Closing will be, a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and has, or will have
prior to Closing, the corporate power and authority to perform its obligations
as contemplated in this Agreement and to enter into and to perform the Closing
Documents to which each such Prime Subsidiary is a party. Prime and each Prime
Subsidiary have, or prior to Closing will have, duly qualified to transact
business in each jurisdiction in which the nature of the business conducted by
it requires such qualification, except where failure to do so could not
reasonably be expected to have a material adverse effect.

               16.2 Authorization. The execution and delivery of this Agreement
by Prime, the execution of all Closing Documents to be executed by Prime and the
consummation by Prime of the transactions contemplated hereby and thereby have
been duly authorized by the Board of Directors of Prime. The execution and
delivery of all Closing Documents to be executed by a Prime Subsidiary, as
applicable, and the consummation by each Prime Subsidiary, as applicable, of the
transactions contemplated hereby and thereby have been, or prior to Closing will
be, duly authorized by such corporation's Board of Directors. Neither the
entering into this Agreement and the other Closing Documents to be executed by
Prime or a Prime Subsidiary, as applicable, nor the consummation of the
transactions contemplated herein or therein will cause a violation, default or
breach by Prime or a Prime Subsidiary, as applicable, of, or conflict with, any
contracts, agreements or instruments to which Prime or a Prime Subsidiary, as
applicable, is a party or by which Prime or a Prime Subsidiary, as applicable,
is bound.

               16.3 Valid and Binding Agreement. This Agreement constitutes, and
each of the Closing Documents to be executed by Prime or a Prime Subsidiary, as
applicable, will constitute upon execution by all parties thereto, a valid and
binding agreement of Prime and the Prime Subsidiaries who are parties thereto,
as applicable, enforceable in accordance with its terms, subject as to
enforceability to bankruptcy, insolvency and similar laws affecting creditors'
rights generally and to the availability of equitable remedies.

               16.4 No Violation. Neither the execution and delivery of this
Agreement, the execution and delivery of the Closing Documents to be executed by
Prime or a Prime Subsidiary, as applicable, nor the consummation by Prime and
the Prime Subsidiaries, as applicable, of the transactions contemplated hereby
or thereby violates or conflicts with either such corporation's Charter or
Bylaws or any agreement or other restriction of any kind to which either such
corporation is as a party or by which either such corporation is bound.




                                     - 42 -
<PAGE>   43

               16.5 Brokers Fees. No brokers, finders or similar agents acting
on behalf of Prime are entitled to any brokerage commission, finder's fee or any
similar compensation in connection with this Agreement or the transactions
contemplated hereby.

                                  ARTICLE XVII
                                     CLOSING

               17.1 Closing. The Closing shall occur on such date as the parties
hereto may agree upon in writing for the closing of the transactions
contemplated hereby; provided, however, that such date shall not be later than
the date thirty (30) days after the last day of the Due Diligence Period;
provided, further, that if on such date the conditions precedent to Closing set
forth in Sections 10.6 and 11.6 have not been satisfied, ShoLodge, by written
notice to Prime, may postpone the Closing while ShoLodge diligently and
continuously attempts to satisfy such conditions precedent, such postponed
Closing to occur no later than the earlier of (i) the date one hundred five
(105) days after the last day of the Due Diligence Period, and (ii) the date
fifteen (15) days after such conditions precedent are satisfied; and provided,
further, that if on such date the condition precedent to Closing with respect to
one (1) or both of the Development Sites set forth in the last paragraph of
Article XI has not been satisfied, ShoLodge, by written notice to Prime, may
postpone the Closing as to such Development Site or Development Sites, as
applicable, while ShoLodge diligently and continuously attempts to satisfy such
condition precedent, such postponed Closing to occur no later than the earlier
of (i) the date one hundred eighty (180) days after the last day of the Due
Diligence Period, and (ii) the date fifteen (15) days after such condition
precedent is satisfied. Notwithstanding the foregoing or any other provision to
the contrary set forth in this Agreement, upon the receipt by ShoLodge from
Prime of (i) ten (10) days advance written notice, and (ii) the written waiver
by Prime of any right to terminate this Agreement pursuant to Section 12.1 or
Section 12.2, Prime, at Prime's option, may proceed to close all (but not less
than all) of the transactions contemplated herein other than the transaction
with respect to the Additional HPT Hotels as contemplated in Article III and
other than the transfer of one (1) or both of the Development Sites the Closing
of which has been postponed as described herein. In the event the transactions
contemplated by this Agreement are closed on more than one (1) date as
contemplated in this Section 17.1, the provisions of this Agreement shall be
interpreted to accommodate such separate Closings, and the provisions of this
Agreement relating to the transactions which have not closed shall remain in
effect following any Closing.

               17.2 Closing Date Deliveries. At the Closing on the Closing Date:

               (a) ShoLodge shall deliver, or cause to be delivered, to Prime, a
Prime Subsidiary or Landlord, as applicable: (1) the Closing Documents to be
signed by ShoLodge and/or a ShoLodge Subsidiary, as applicable, properly
executed by ShoLodge and/or the ShoLodge Subsidiaries, as applicable, (2) a
certificate of existence or similar document from the Secretary of State of the
State of Tennessee or from such other appropriate official in Tennessee
evidencing the due organization, valid existence and good standing of ShoLodge
and the ShoLodge Subsidiaries under the laws of the State of Tennessee, (3)
resolutions of ShoLodge and the ShoLodge Subsidiaries authorizing the
transactions contemplated hereby, certified by the Secretary



                                     - 43 -
<PAGE>   44

of ShoLodge and the ShoLodge Subsidiaries, (4) the HPT Estoppel Certificate, (5)
the HPT Lease Amendment, (6) title records for any vehicles transferred pursuant
to this Agreement, and (7) such other documents as Prime shall reasonably
request.

               (b) Prime shall deliver, or cause to be delivered, to ShoLodge, a
ShoLodge Subsidiary or Landlord, as applicable: (1) the Closing Documents to be
signed by Prime and/or a Prime Subsidiary, as applicable, properly executed by
Prime and/or the Prime Subsidiaries, as applicable, (2) a certificate of
existence or similar document from the Secretary of State of the State of
Delaware or from such other appropriate official in Delaware evidencing the due
organization, valid existence and good standing of Prime and the Prime
Subsidiaries under the laws of the State of Delaware, (3) resolutions of Prime
and the Prime Subsidiaries authorizing the transactions contemplated hereby,
certified by the Secretary of Prime and the Prime Subsidiaries, and (4) such
other documents as ShoLodge shall reasonably request.

               17.3 Possession. Possession of all tangible Assets will be
delivered by ShoLodge and the ShoLodge Subsidiaries, as applicable, to Prime or
a Prime Subsidiary, as applicable, on the Closing Date, and ShoLodge and the
ShoLodge Subsidiaries, as applicable, shall relinquish their use of or claims to
any and all intangible Assets on the Closing Date.

               17.4 Employment Matters. At Closing, all employees working at the
Hotels shall be terminated by ShoLodge or a ShoLodge Subsidiary, as applicable,
and ShoLodge or such ShoLodge Subsidiary, as applicable, shall pay all salaries
and wages and, to the extent possible, all accrued but unsatisfied benefits of
such employees with regard to all periods of time prior to the Closing Date.
ShoLodge shall defend, indemnify and hold Prime and the Prime Subsidiaries, as
applicable, harmless from and against any and all loss, expense (including,
without limitation, reasonable attorneys' fees and court costs arising from the
enforcement of this indemnity), damage and liability arising from the
termination of any employees on the Closing Date, including, without limitation,
any claim, damage, penalty or fees, including reasonable attorneys' fees,
arising out of the failure of ShoLodge or a ShoLodge Subsidiary, as applicable,
to comply with all provisions of the Worker Adjustment and Retraining Act, as
amended, except to the extent any of the foregoing is caused by the failure of
Prime or a Prime Subsidiary, as applicable, to rehire such employees pursuant to
the next succeeding sentence and except to the extent the Purchase Price is
decreased for accrued but unpaid benefits due to such terminated employees
pursuant to Section 9.1(b)(vi). Immediately following the termination of all
employees working at the Hotels as contemplated herein, Prime shall hire, or
shall cause a Prime Subsidiary to hire, all such employees other than the
general manager, the assistant general manager and the director of sales at each
Hotel. Prior to the execution of this Agreement, ShoLodge has provided to Prime
a schedule of all employees working at the Hotels by classification, seniority,
rate of pay and accrued benefits. Prime may, during normal business hours and
with prior notice to ShoLodge during the Due Diligence Period, interview the
general managers, assistant general managers and directors of sales to determine
if Prime wants to employ such employees. The provisions of this Section 17.4
shall survive the Closing.

               17.5 Closing Costs and Expenses. Prime shall pay or cause to be
paid the premium for any title policy insuring Prime or a Prime Subsidiary, as
applicable, as to the Real




                                     - 44 -
<PAGE>   45

Property. All costs of recording the transfer and assignment documents to Prime
or a Prime Subsidiary, as applicable, contemplated herein, including, without
limitation, any and all real estate transfer taxes, shall be paid in accordance
with local custom. Except as set forth in the preceding sentence, each party
shall be responsible for the payment of its own attorney's fees, copying
expenses and other costs and expenses incurred in connection with the
negotiation of this Agreement and the consummation of the transactions
contemplated hereunder. The provisions of this Section 17.5 shall survive the
Closing and any termination of this Agreement.

               17.6 Hendersonville Restriction. At or prior to Closing, ShoLodge
shall cause to be recorded against the Hendersonville, Tennessee Hotel
restrictions and covenants (i) requiring the lessee under the HPT Lease during
the term thereof (including extensions and renewals) and thereafter the owner of
such property (A) to secure the approval (not to be unreasonably withheld,
delayed or conditioned) of the owner of the adjacent property on which
ShoLodge's corporate offices are located of any change, alteration, repair,
repainting or similar activity which affects the exterior of such Hotel or the
premises on which such Hotel is located except in an insignificant manner and
(B) to maintain such Hotel and such premises in a neat and attractive manner
consistent with the standard for AmeriSuites hotels, and (ii) providing for
common lawncare and maintenance of landscaping of such properties and the
adjacent bank property with the cost to be shared based on the square footage of
each property compared to the total square footage of all such property (the
"Hendersonville Restriction"). At least ten (10) days prior to recordation,
ShoLodge shall deliver to Prime a copy of the proposed Hendersonville
Restriction for Prime's written approval, such approval not to be unreasonably
withheld, delayed or conditioned. In no event shall the Hendersonville
Restriction be recorded without Prime's prior written approval. The portion of
the Hendersonville Restriction described in part (ii) of the first sentence of
this Section 17.6 shall be mutually restrictive as to all real property covered
thereby. The provisions of this Section 17.6 shall survive the Closing, but any
conflict between the terms of this Section 17.6 and the terms of the
Hendersonville Restriction shall be governed by the Hendersonville Restriction.


                                  ARTICLE XVIII
                               POST CLOSING ITEMS

               18.1 Operating Permits. Prime or a Prime Subsidiary, as
applicable, shall apply for new or modified operating permits and licenses,
including, without limitation, liquor licenses, if applicable, to reflect Prime
or a Prime Subsidiary, as applicable, as the new operator of the Hotels as soon
as possible after Closing. ShoLodge and the ShoLodge Subsidiaries, as
applicable, shall cooperate with Prime or a Prime Subsidiary, as applicable, in
its efforts to obtain new operating permits and licenses for the Hotels or
modifications to existing operating permits and licenses or, to the extent
permitted by applicable law, to maintain the existing operating permits and
licenses in effect until such time as the new or modified operating permits and
licenses may be obtained. Until such time as such new or modified operating
permits and licenses are obtained, ShoLodge and the ShoLodge Subsidiaries, as
applicable, to the extent permitted by applicable law, shall take all steps
reasonably necessary to enable the current operating permits and licenses, if
any, to be used in the operation of the Hotels and to permit the continued
operation of the Hotels,




                                     - 45 -
<PAGE>   46

including, without limitation, the uninterrupted sale and serving of alcoholic
beverages at the Hotels, if applicable. All costs and expenses incurred by
ShoLodge or a ShoLodge Subsidiary in connection with the foregoing shall be paid
by Prime or a Prime Subsidiary, as applicable, and Prime and the Prime
Subsidiaries shall defend, indemnify and hold ShoLodge and the ShoLodge
Subsidiaries harmless from and against any and all loss, expense (including,
without limitation, reasonable attorney's fees and court costs arising from the
enforcement of this indemnity), damage and liability arising from the foregoing,
and Prime and the Prime Subsidiaries shall cause ShoLodge and the ShoLodge
Subsidiaries, as applicable, to be named as additional insureds under their
liability insurance policies for the Hotels including, without limitation, under
their liquor liability or "dram shop" coverage with respect to the sale,
distribution or consumption of alcoholic beverages. Evidence of such insurance
shall be provided to ShoLodge at Closing, and such insurance must contain a
provision to the effect that it may not be canceled or modified without thirty
(30) days advance written notice from the insurer to ShoLodge (until such time
as the new or modified operating permits and licenses are received). The
provisions of this Section 18.1 shall survive the Closing.

               18.2 Radius Restriction. For a twenty (20) year period commencing
on the Closing Date, neither ShoLodge nor any ShoLodge Affiliate shall own,
operate or franchise any all-suites hotel substantially similar in nature and
kind to the AmeriSuites hotels to be operated by Prime or a Prime Subsidiary, as
applicable, as contemplated in this Agreement anywhere within a certain
designated area of each Hotel, such area being as to the Existing HPT Hotels and
the Additional HPT Hotels the applicable "Restricted Trade Area" as set forth in
Exhibit B to the HPT Lease or the comparable provision of any separate lease
contemplated in Section 3.3 and in Section 3.8, as applicable, and being as to
the Texas Hotels a three (3) mile radius of each such Texas Hotel. The
foregoing, however, shall not limit ShoLodge or any ShoLodge Affiliate from (i)
developing or constructing any all-suites hotel substantially similar in nature
and kind to the AmeriSuites hotels contemplated herein within such restricted
area as long as such hotel is both (A) operated by someone other than ShoLodge
or a ShoLodge Affiliate, and (B) owned by someone other than ShoLodge or a
ShoLodge Affiliate, or (ii) owning, operating or franchising (A) any "Shoney's"
brand all-suites hotel within such restricted area, or (B) any other hotel
within such restricted area as long as such other hotel is not an all-suites
hotel substantially similar in nature and kind to the AmeriSuites hotels
contemplated herein. The provisions of this Section 18.2 shall survive the
Closing. Prime shall have the right to any remedies available to it at law or in
equity, including without limitation, injunction, in the event ShoLodge or any
ShoLodge Affiliate violates the covenant set forth in this Section 18.2.


                                   ARTICLE XIX
             SURVIVAL OF REPRESENTATIONS; INDEMNIFICATIONS; REMEDIES

               19.1 Survival of Representations. All representations and
warranties made by any party in this Agreement shall be true and correct in all
material respects as of Closing and, subject to the limitations described in
Section 19.6 below, shall survive the Closing hereunder.




                                     - 46 -
<PAGE>   47

               19.2 Indemnification by Prime. Prime hereby indemnifies and holds
ShoLodge and the ShoLodge Subsidiaries harmless from and against, and agrees to
promptly defend ShoLodge and the ShoLodge Subsidiaries from and reimburse
ShoLodge and the ShoLodge Subsidiaries for, any and all losses, damages, costs,
expenses, liabilities, obligations, suits, actions, proceedings (formal or
informal), investigations, settlements and claims of any kind (including,
without limitation, reasonable attorney fees and other legal costs and expenses)
which ShoLodge or the ShoLodge Subsidiaries may at any time suffer or incur, or
become subject to, as a result of or in connection with:

               (a) the representations and warranties made by Prime in this
Agreement having been untrue or incorrect in any material respect;

               (b) any failure by Prime to carry out, perform, satisfy and
discharge any of the covenants, agreements, undertakings, liabilities or
obligations of Prime under this Agreement; and

               (c) except to the extent the Purchase Price or the Development
Site Purchase Price has been increased pursuant to Section 9.1(a) for the
obligation in question, the operation of the Hotels on and after the Closing
Date, including, without limitation, the following:

                       (i) any obligation arising out of an accident, injury,
               death or damage whatsoever caused to any Person or loss of
               property occurring on or after the Closing Date in or about the
               Assets or any part thereof; and

                       (ii) any obligation arising out of any actions or
               omissions of Prime or a Prime Subsidiary or its or their agents,
               representatives, employees or contractors relating to the Assets
               on or after the Closing Date.

               19.3 ShoLodge's Indemnity. ShoLodge hereby indemnifies and holds
Prime and the Prime Subsidiaries harmless from and against, and agrees promptly
to defend Prime and the Prime Subsidiaries from and reimburse Prime and the
Prime Subsidiaries for, any and all losses, damages, costs, expenses,
liabilities, obligations, suits, actions, proceedings (formal or informal),
investigations, settlements and claims of any kind (including, without
limitation, reasonable attorney fees and other legal costs and expenses) which
Prime or the Prime Subsidiaries may at any time suffer or incur, or become
subject to, as a result of or in connection with:

               (a) the representations and warranties made by ShoLodge in this
Agreement having been untrue or incorrect in any material respect;

               (b) any failure by ShoLodge to carry out, perform, satisfy and
discharge any of the covenants, agreements, undertakings, liabilities or
obligations of ShoLodge under this Agreement;

               (c) except to the extent the Purchase Price or the Development
Site Purchase Price has been decreased pursuant to Section 9.1(b) for the
obligation in question, the operation of the Hotels prior to the Closing Date,
including, without limitation, the following:



                                     - 47 -
<PAGE>   48

                       (i) any obligation arising out of an accident, injury,
               death or damage whatsoever caused to any Person or loss of
               property occurring prior to the Closing Date in or about the
               Assets or any part thereof;

                       (ii) any obligation arising out of any actions or
               omissions of ShoLodge or a ShoLodge Subsidiary or its or their
               agents, representatives, employees or contractors relating to the
               Assets prior to the Closing Date; and

                       (iii) accounts payable with respect to goods or services
               provided to or for the Hotels prior to the Closing Date; and

               (d) any failure of ShoLodge or any ShoLodge Subsidiary to comply
with any bulk sales law or like statute in connection with the transactions
contemplated herein.

               Notwithstanding the foregoing, ShoLodge shall have no obligation
to indemnify Prime or the Prime Subsidiaries with respect to any representation
or warranty concerning the condition of the STI Assets, the Additional Property
or the Texas Property or any portion thereof to the extent such condition can be
corrected (by maintenance, repair or replacement) pursuant to the terms of the
HPT Lease or the Texas Lease with funds in the "FF&E Reserve" created pursuant
to the HPT Lease (or a similar fund created under a separate lease contemplated
in Section 3.3 and in Section 3.8) or the Texas Lease, as applicable.

               19.4 Notification of Claims.

               (a) A party or parties entitled to be indemnified pursuant to
Section 19.2 or 19.3 hereof or otherwise pursuant to this Agreement (the
"Indemnified Party") shall notify the party or parties liable for such
indemnification (the "Indemnifying Party") in writing of any claim or demand
which the Indemnified Party has determined has given or could give rise to a
right of indemnification under this Agreement. Subject to the Indemnifying
Party's right to defend in good faith third party claims as hereinafter
provided, the Indemnifying Party shall satisfy its obligations under this
Article XIX or otherwise pursuant to this Agreement within thirty (30) days
after the receipt of written notice thereof from the Indemnified Party.

               (b) If the Indemnified Party shall notify the Indemnifying Party
of any claim or demand pursuant to Section 19.4(a), and if such claim or demand
relates to a claim or demand asserted by a third party against the Indemnified
Party which the Indemnified Party asserts is a claim or demand for which the
Indemnifying Party must indemnify or hold harmless the Indemnified Party under
Section 19.2 or 19.3 hereof or otherwise pursuant to this Agreement, the
Indemnifying Party shall have the right to employ counsel to defend any such
claim or demand asserted against the Indemnified Party. The Indemnified Party
shall have the right to cooperate at its expense in the defense of any such
claim or demand. The Indemnifying Party shall notify the Indemnified Party in
writing, within thirty (30) days after the date of the notice of claim given by
the Indemnified Party to the Indemnifying Party under Section 19.4(a) of its
election to defend in good faith any such third party claim or demand. So long
as the Indemnifying Party is defending in good faith any such claim or demand
asserted by a third party against the Indemnified




                                     - 48 -
<PAGE>   49
Party, the Indemnified Party shall not settle or compromise such claim or
demand. The Indemnified Party shall make available to the Indemnifying Party or
its agents all records and other materials in the Indemnified Party's possession
reasonably required by the Indemnifying Party for its use in contesting any
third party claim or demand. Whether or not the Indemnifying Party elects to
defend any such claim or demand, the Indemnified Party shall have no obligation
to do so.

               19.5 Remedies.

               (a) If ShoLodge fails or refuses to timely perform ShoLodge's
obligations hereunder, Prime shall have only the following options: (i) to
terminate this Agreement as provided in Article XI and thereupon this Agreement
shall terminate, and Prime and ShoLodge shall be relieved and released of any
further obligations, claims and liabilities hereunder, except for the
performance by each party of its Post Termination Obligations which shall remain
enforceable, and except that Prime may pursue a suit against ShoLodge for
damages resulting from any failure or refusal of ShoLodge to perform ShoLodge's
obligations hereunder prior to such termination, or (ii) to pursue any and all
remedies available to Prime at law or in equity, including, without limitation,
a suit for specific performance.

               (b) If Prime fails or refuses to timely perform Prime's
obligations hereunder, ShoLodge shall have only the following options: (i) to
terminate this Agreement as provided in Article X and thereupon this Agreement
shall terminate, and Prime and ShoLodge shall be relieved and released of any
further obligations, claims and liabilities hereunder, except for the
performance by each party of its Post Termination Obligations which shall remain
enforceable and except that ShoLodge may pursue a suit against Prime for damages
resulting from any failure or refusal of Prime to perform Prime's obligations
hereunder prior to such termination, or (ii) to pursue any and all remedies
available to ShoLodge at law or in equity, including, without limitation, a suit
for specific performance.

               (c) Notwithstanding anything to the contrary expressed or implied
in this Agreement, the sole and exclusive remedy of Prime and the Prime
Subsidiaries for any breach of any representation or warranty of ShoLodge
contained in this Agreement shall be as follows: (i) prior to Closing, to
terminate this Agreement pursuant to Article XI; and (ii) on and after Closing,
to obtain indemnification from ShoLodge pursuant to this Article XIX. Prime and
the Prime Subsidiaries shall have no other right or remedy with respect to the
breach of any representation or warranty of ShoLodge contained in this Agreement
at law or in equity.

               19.6 Limitations. Notwithstanding the foregoing, unless notice of
any claim for any indemnification obligation of ShoLodge for any breach of any
representation or warranty of ShoLodge contained in this Agreement has been
given to ShoLodge within twelve (12) months after the Closing, no claim may be
asserted against, and no action, suit or proceeding may be brought against,
ShoLodge. Further, notwithstanding anything contained herein to the contrary,
neither Prime nor the Prime Subsidiaries shall have the right to recover damages
against ShoLodge for the breach of any representation or warranty of ShoLodge
contained herein as to which Prime or a Prime Subsidiary had knowledge prior to
or at Closing, and neither ShoLodge nor any




                                     - 49 -
<PAGE>   50

ShoLodge Subsidiary shall have the right to recover damages against Prime for
the breach of any representations or warranty of Prime contained herein as to
which ShoLodge or any ShoLodge Subsidiary had knowledge prior to or at Closing.

               19.7 Survival. The provisions of this Article XIX shall survive
the Closing of the transactions contemplated by this Agreement, and the
provisions of Section 19.4 shall survive the termination of this Agreement and
apply with respect to indemnification obligations constituting a part of the
Post Termination Obligations. Further, the provisions of Section 19.5(a)(i) and
Section 19.5(b)(i) concerning a suit for damages shall survive the termination
of this Agreement pursuant to Section 19.5.


                                   ARTICLE XX
                                  MISCELLANEOUS

               20.1 Confidentiality. Each of the parties hereto agrees and
undertakes to retain in confidence and to require its respective employees,
consultants and agents to retain in confidence, all information obtained in
connection with this Agreement and the transactions and disclosures contemplated
hereby which information is not generally ascertainable from public sources.
Except as required by law, each of the parties further agrees not to make any
disclosure to non-parties, or any public announcements, regarding this Agreement
or the transactions contemplated hereby without the prior consent of the other
party hereto. It is understood and agreed, however, that this section will not
be construed as an obligation to refrain from business activities in the future
that are similar to the business in which the parties hereto are now engaged.
The provisions of this Section 20.1 shall survive the Closing and any
termination of this Agreement.

               20.2 Parties in Interest. Except as otherwise expressly provided
herein, all the terms and provisions of this Agreement shall be binding upon,
shall inure to the benefit of, and shall be enforceable by the respective heirs,
beneficiaries, personal and legal representatives, successors, and assigns of
the parties hereto. Notwithstanding the foregoing, Prime shall not assign its
rights under this Agreement without the prior written approval of ShoLodge, and
any attempted assignment without such approval shall be null and void.

               20.3 Entire Agreement; Amendments. This Agreement, including the
exhibits and other documents and writings referred to herein or delivered
pursuant hereto, which form a part hereof, contains the entire understanding of
the parties with respect to this subject matter. There are no restrictions,
agreements, promises, warranties, covenants, or undertakings other than those
expressly set forth herein or therein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to its subject
matter. This Agreement may be amended only by a written instrument duly executed
by the parties or their respective successors or permitted assigns. Any
condition to a party's obligations hereunder may be waived by such party in
writing.




                                     - 50 -
<PAGE>   51

               20.4 Headings. The section and paragraph headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.

               20.5 Notices. Any notice, request or other communication to be
given by any party hereunder shall be in writing and shall be deemed effective
three (3) business days after deposit in the United States Registered or
Certified Mail, postage prepaid, return receipt requested, or one (1) business
day after delivery to an overnight courier service for next business day
delivery or upon delivery in person, or upon sending via telecopy with a copy
deposited in the United States first class mail, addressed to such party as
follows:

               20.6 If to ShoLodge, then to:

                              ShoLodge, Inc.
                              130 Maple Drive North
                              Hendersonville, TN 37075
                              Attn: Leon Moore
                              Telecopy:  (615)264-1758

                              and with a copy to:

                              Boult, Cummings, Conners & Berry, PLC
                              414 Union Street, Suite 1600
                              Nashville, TN 37219
                              Attn: Patrick L. Alexander, Esq.
                              Telecopy:  (615)252-6362

               20.7 If to Prime, then to:

                              Prime Hospitality Corp.
                              700 Route 46 East
                              Fairfield, NJ 07004
                              Attn: Douglas W. Vicari
                              Telecopy: (973) 882-7635

                              and with a copy to:

                              Prime Law Department
                              700 Route 46 East
                              Fairfield, NJ  07004
                              Attn: Joseph Bernadino, Esq.
                              Telecopy: (973)882-1787

or to such other address as any party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall only be
effective upon receipt.




                                     - 51 -
<PAGE>   52

               20.8 Counterparts. This Agreement may be executed simultaneously
in several counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

               20.9 Severability. If any provision, clause or part of this
Agreement or the application thereof under certain circumstances is held
invalid, the remainder of this Agreement or the application of such provision,
clause or part under other circumstances shall not be affected thereby.

               20.10 Time of Essence. Time is of the essence in this Agreement,
and all dates and time periods specified herein shall be strictly observed.

               20.11 Enforcement Expenses. The prevailing party in any action
commenced due to the breach hereof shall be entitled to recover its costs,
expenses and reasonable attorney's fees incurred in the enforcement of this
Agreement.

               20.12 Survival. The provisions of this Agreement which by their
terms survive or must survive in order to accomplish the purpose of such
provisions shall survive the termination of this Agreement.

               20.13 Governing Laws. This Agreement shall be construed and
enforced in accordance with the laws of the State of Delaware.

               20.14 Representation by Counsel. The parties acknowledge that
each party to this Agreement has been represented by counsel and such counsel
have participated in the negotiation and preparation of this Agreement. This
Agreement shall be construed without regard to any presumption or rule requiring
that it be construed or constructed against the party who has drafted or caused
the Agreement to be drafted.

               20.15 Notice by Counsel. Anything contained in this Agreement to
the contrary notwithstanding, all notices pursuant to this Agreement, whether
from ShoLodge to Prime or from Prime to ShoLodge, will be effective if executed
by and sent by the attorney of the party sending such notice. Prime and ShoLodge
hereby agree that if a notice is given hereunder by counsel, such counsel may
communicate directly in writing with all principals, as may be required to
comply with the notice provisions of this Agreement.

               20.16 No Recording. ShoLodge and Prime hereby acknowledge that
neither this Agreement nor any memorandum, affidavit or other instrument
evidencing this Agreement or relating hereto (other than the closing documents
contemplated hereunder) shall ever be recorded in the real property records
where any of the Real Property is located.

               20.17 Exclusive Contract. Beginning on the Effective Date and
continuing until the termination of this Agreement, unless ShoLodge obtains the
prior approval of Prime, ShoLodge shall not enter into an agreement to sell,
lease or otherwise transfer and convey the Assets or any portion thereof to
anyone other than Prime or a Prime Subsidiary; provided,




                                     - 52 -
<PAGE>   53

however, that the foregoing shall not apply to the sale of such portion of the
Assets as would be sold in the ordinary course of business notwithstanding the
transactions contemplated herein or to the sale of such portion of the Assets to
Landlord as is contemplated herein.




                         (signatures on following page)






                                     - 53 -
<PAGE>   54


               IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly signed, all as of the date first above written.

                                     SHOLODGE, INC.


                                     By: /s/ Leon Moore
                                         ---------------------------------------
Date:3-15-00                         Title: President
                                            ------------------------------------


                                     PRIME HOSPITALITY CORP.


                                     By: /s/ Douglas Vacari
                                         ---------------------------------------

Date:3-16-00                         Title: Senior Vice President
                                            ------------------------------------





                                     - 54 -
<PAGE>   55








                                    EXHIBIT A

                               LEGAL DESCRIPTIONS
                                   (STI LAND)











                                      A - 1


<PAGE>   56









                                    EXHIBIT B

                               LEGAL DESCRIPTIONS
                                (ADDITIONAL LAND)














                                      B - 1


<PAGE>   57










                                    EXHIBIT C

                               LEGAL DESCRIPTIONS
                                  (TEXAS LAND)














                                      C - 1


<PAGE>   58








                                    EXHIBIT D

                               LEGAL DESCRIPTIONS
                               (DEVELOPMENT SITES)














                                      D - 1


<PAGE>   59


                                                               [Mt. Laurel, NJ]




                                    EXHIBIT D

                              Property Description

That certain parcel of real property situate in the Township of Mount Laurel and
the Township of Evesham, Burlington County, New Jersey, being (i) the property
designated as Proposed Parcel No. 3 (consisting of the property designated on
the Mount Laurel Township Tax Map as Block 1300.03, Lot 5.02, and the property
designated on the Evesham Township Tax Map as Block 1, Lot 3.02), on that
certain map entitled "Final Subdivision Plan Block 1300.03 Lot 5 Mount Laurel
Township & Block 1 Lot 3 Evesham Township Burlington County, New Jersey"
prepared by Marc Associates, Inc., dated September 8, 1997, revised through
January 28, 1998, and recorded on April 6, 1998 in the Burlington County Clerk's
Office as Map No. 3175481, and (ii) the property designated on the Mount Laurel
Township Tax Map as Block 1300.03, Lot 6. The property designated on the Mount
Laurel Township Tax Map as Block 1300.03 Lots 5.02 and 6 was consolidated by
Declaration of Consolidation dated May 4, 1999, recorded on May 28, 1999 in the
Burlington County Clerk's Office in DB 5697, page 565. All such property is more
particularly described according to ALTA/ACSM Land Title Survey of Marc
Associates, Inc. dated May 4, 1998, revised September 19, 1998, September 22,
1998 and October 10, 1998 (Seifert Proj. No. 5018) as follows:

BEGINNING at a point in the Westerly right of way line of New Jersey State
Highway Route 73, said point being the Southerly end of a curve having a radius
of 35 feet, connecting the said right of way line of Route 73 with the Southerly
right of way line of Crawford Place and extending; thence,

(1) Along the said line of Route 73 South 24 degrees 15 minutes 20 seconds East
a distance of 290.60 feet to a point in the division line between Block 1300.03,
Lots 6 and 11.01, thence

(2) South 87 degrees 39 minutes 10 seconds West along the said division line a
distance of 233.02 feet to an angle point in same, thence

(3) South 24 degrees 15 minutes 20 seconds East a distance of 229.97 feet
crossing over the division line between Mt. Laurel and Evesham Townships to a
point in the division line between Block 1, Lot 3.02 and Block 1.12, Lot 1 in
the Township of Evesham, thence

(4) South 01 degrees 53 minutes 20 seconds East along said division line a
distance of 215.46 feet to an angle point in same, thence

(5) South 89 degrees 31 minutes 25 seconds West along said line a distance of
646.40 feet to a point in the division line between Block 1, Lots 3.01 and 3.02,
thence



                                      D - 2


<PAGE>   60


                                                               [Mt. Laurel, NJ]



                                    EXHIBIT D

                              Property Description
                                   (continued)

(6) North 11 degrees 08 minutes 27 seconds West a distance of 553.96 feet
crossing over the division line between Mt. Laurel and Evesham Townships to a
point in the said Southerly right of way line of Crawford Place, thence

(7) North 78 degrees 51 minutes 33 seconds East along said right of way line a
distance of 518.52 feet to a point of curvature in same, thence

(8) Curving to the left along said right of way line with a radius of 560.00
feet, an arc distance of 128.08 feet having a central angle of 13 degrees 06
minutes 16 seconds to a point of tangency in same, thence

(9) North 65 degrees 45 minutes 17 seconds East along said right of way line a
distance of 97.07 feet to a point of curvature in same, thence

(10) Curving to the right with a radius of 35 feet, an arc distance of 54.97
feet with a central angle of 89 degrees 59 minutes 23 seconds to the point and
place of BEGINNING.

Containing 10.23 acres of land, more or less.






                                      D - 3


<PAGE>   61



                                                           [Fairfax County, VA]



                                    Exhibit D

                              Property Description

               Lot 3 (containing 3.5400 acres), Being a Division of Parcel 21-1,
Westfields, The International Corporate Center at Dulles, as the same appears
platted, dedicated and recorded by Deed of Resubdivision recorded in Deed Book
10581, at Page 1482, among the land records of Fairfax County, Virginia

               TOGETHER WITH AND SUBJECT TO a non-exclusive easement for ingress
and egress along the "Common Driveway" and an easement for utilities on both
sides of such "Common Driveway", as set forth in that certain instrument
entitled Ingress-Egress Easement Agreements dated as of April 28, 1988, and
recorded April 28, 1988, in Deed Book 7011 at Page 1281, among the land records
of Fairfax County, Virginia, as amended by instrument entitled Amendment to
Ingress Egress Easement Agreement and Relocation of Common Driveway dated as of
May 14, 1998, and recorded May 15, 1998, in Deed Book 10395 at Page 1222, among
the aforesaid land records.





                                      D - 4


<PAGE>   62



                                    EXHIBIT E

                  ASSIGNMENT AND ASSUMPTION OF LEASE AGREEMENT

               THIS ASSIGNMENT AND ASSUMPTION OF LEASE AGREEMENT ("Assignment")
is made and delivered on this _____ day of __________, 2000, by SUITE TENANT,
INC., a Tennessee corporation ("Assignor"), to ____________________, a Delaware
corporation ("Assignee").

                              W I T N E S S E T H :

               WHEREAS, by Lease Agreement dated as of November 19, 1997 (the
"Lease Agreement"), HPT Suite Properties Trust, a Maryland real estate
investment trust ("Lessor"), as landlord, leased to Assignor, as tenant, certain
parcels of land and improvements thereon as more particularly described in the
Lease Agreement; and

               WHEREAS, the Lease Agreement was amended by that certain First
Amendment to Lease Agreement (the "First Amendment") dated as of March 5, 1999,
between Lessor and Assignor; and

               WHEREAS, the Lease Agreement was further amended by that certain
Second Amendment to Lease Agreement and First Amendment to Incidental Documents
(the "Second Amendment") dated as of June 29, 1999, among Hospitality Properties
Trust, Lessor, ShoLodge, Inc. and Assignor; and

               WHEREAS, the Lease Agreement was further amended by that certain
Third Amendment to Lease Agreement (the "Third Amendment") dated as of March 3,
2000, between Lessor and Assignor (the Lease Agreement as amended by the First
Amendment, the Second Amendment and the Third Amendment is collectively referred
to herein as the "Lease"); and

               WHEREAS, Assignor now desires to assign its interest under the
Lease to Assignee, and Assignee desires to assume all of Assignor's obligations
under the Lease which first accrue from and after the date of this Assignment,
on the terms and conditions set forth herein.

               NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the mutual receipt and
legal sufficiency of which are hereby acknowledged, Assignor hereby grants,
assigns, transfers and sets over to Assignee all of Assignor's right, title and
interest in, to and under the Lease (including, without limitation, the
"Retained Funds" and the "FF&E Reserve" (both as described in the Lease)) and
the leasehold estate of Assignor as created by the Lease, together with any and
all easement rights of any kind appurtenant to and benefitting the premises
demised under the Lease and with all right, title and interest of Assignor in
and to any and all buildings, structures and improvements now or hereafter
erected on, over, upon or under the premises demised under the Lease and
together with all right,




                                      E - 1


<PAGE>   63



title and interest of Assignor in and to the "Fixtures" and the "Leased Personal
Property" (both as described in the Lease).

               TO HAVE AND TO HOLD the same unto Assignee, its successors and
assigns, from the date hereof and for the rest of the term mentioned in the
Lease, subject to the terms, covenants, provisions and conditions of the Lease,
and subject to all existing title encumbrances of record.

               Assignee hereby assumes and agrees to perform all obligations,
covenants and agreements of Assignor under the Lease arising from and after the
date hereof and to be bound by all the respective terms and provisions thereof
from and after the date hereof.

               Except as expressly provided otherwise in the Purchase Agreement
described below, Assignor hereby agrees to indemnify and hold Assignee harmless
from and against any and all liability, loss, costs, damages and expenses,
including reasonable attorneys' fees, incurred by Assignee as a result of
Assignor's failure to perform its obligations under the Lease which arose before
the date of this instrument.

               Except as expressly provided otherwise in the Purchase Agreement
described below, Assignee hereby agrees to indemnify and hold Assignor harmless
from and against any and all liability, loss, costs, damages and expenses,
including reasonable attorneys' fees, incurred by Assignor as a result of
Assignee's failure to perform its obligations under the Lease which arise from
and after the date of this instrument.

               This Assignment is made pursuant to and subject to the terms and
provisions of that certain Sale and Purchase Agreement dated ___________, 2000,
between ShoLodge, Inc. and Prime Hospitality Corp. (the "Purchase Agreement").

               Assignor agrees to perform, execute and/or deliver or cause to be
performed, executed and/or delivered any and all such further acts and
assurances as Assignee may reasonably require to perfect Assignee's interest in
the Lease and the leasehold estate assigned by this Assignment.

               Simultaneously with the execution and delivery of this
Assignment, Assignor has executed and delivered to Assignee various other
instruments of transfer and conveyance. Nothing herein contained shall be deemed
to limit or restrict the properties, assets and rights conveyed, assigned or
transferred to or acquired by Assignee by such other instruments.

               This Assignment may be executed simultaneously in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.




                                      E - 2


<PAGE>   64



               IN WITNESS WHEREOF, the parties have executed this Assignment on
the date set forth above.


                                    ASSIGNOR:

                                    SUITE TENANT, INC., a Tennessee corporation



                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------



                                    ASSIGNEE:


                                    -------------------------------------------,
                                    a Delaware corporation



                                    By:
                                        ----------------------------------------
                                    Title:
                                           -------------------------------------





                                      E - 3


<PAGE>   65



                                    EXHIBIT F

                                  BILL OF SALE

               ____________________ (herein "Seller"), a Tennessee corporation
having an office at 130 Maple Drive North, Hendersonville, Tennessee 37075, in
consideration of Ten and No/100 Dollars ($10.00), receipt of which is hereby
acknowledged, does hereby sell, assign, transfer and set over to
____________________ (herein "Buyer"), a Delaware corporation having an office
at 700 Route 46 East, Fairfield, New Jersey 07004, all of Seller's right, title
and interest in and to the [STI] [Additional] [Texas] Inventory and the [STI]
[Additional] [Texas] Advance Payments (as those terms are defined in the
Purchase Agreement described below).

               This Bill of Sale is made pursuant to and subject to the terms
and provisions of that certain Sale and Purchase Agreement (the "Purchase
Agreement") dated _________, 2000, between ShoLodge, Inc. and Prime Hospitality
Corp.

               Seller agrees to perform, execute and/or deliver or cause to be
performed, executed and/or delivered any and all such further acts and
assurances as Buyer may reasonably require to more fully vest in Buyer title to
any and all of the properties transferred by this Bill of Sale.

               Simultaneously with the execution and delivery of this Bill of
Sale, Seller has executed and delivered to Buyer various other instruments of
transfer and conveyance. Nothing herein contained shall be deemed to limit or
restrict the properties, assets and rights conveyed, assigned or transferred to
or acquired by Buyer by such other instruments.

               IN WITNESS WHEREOF, Seller has caused this Bill of Sale to be
executed by an officer duly authorized the ____ day of __________, 2000.


                                     ________________, a Tennessee corporation


                                    By:
                                       ----------------------------------------
                                    Title:
                                          -------------------------------------

STATE OF ___________  )
COUNTY OF __________  )

               The foregoing instrument was acknowledged before me this _____
day of __________, 2000, by ____________________, the __________ of
____________________, a Tennessee corporation, on behalf of the corporation.


                                              ----------------------------------
                                              Notary Public
                                              My commission expires:
                                                                    ------------





                                      F - 1


<PAGE>   66



                                    EXHIBIT G

                     ASSIGNMENT AND ASSUMPTION OF CONTRACTS

                FOR VALUE RECEIVED, ____________________, a Tennessee
corporation ("Assignor"), hereby conveys, assigns, transfers and sets over unto
____________________, a Delaware corporation ("Assignee"), to the extent
assignable, all the right, title and interest of Assignor, if any, in and to the
[STI] [Additional] [Texas] Operating Agreements (as that term is defined in the
Purchase Agreement described below).

                Assignee hereby accepts the foregoing conveyance, assignment and
transfer and hereby assumes all obligations of Assignor under the [STI]
[Additional] [Texas] Operating Agreements accruing from and after the date
hereof. Except as expressly provided otherwise in the Purchase Agreement,
Assignor does hereby indemnify and hold Assignee harmless against any liability
under the [STI] [Additional] [Texas] Operating Agreements accruing prior to the
date hereof, and, except as expressly provided otherwise in the Purchase
Agreement, Assignee does hereby indemnify and hold Assignor harmless against any
liability under the [STI] [Additional] [Texas] Operating Agreements accruing
from and after the date hereof.

                This Assignment and Assumption of Contracts is made pursuant to
and subject to the terms and provisions of that certain Sale and Purchase
Agreement dated ___________, 2000, between ShoLodge, Inc. and Prime Hospitality
Corp. (the "Purchase Agreement").

                Assignor agrees to perform, execute and/or deliver or cause to
be performed, executed and/or delivered any and all such further acts and
assurances as Assignee may reasonably require to perfect Assignee's interest in
the properties assigned by this Assignment and Assumption of Contracts.

                Simultaneously with the execution and delivery of this
Assignment and Assumption of Contracts, Assignor has executed and delivered to
Assignee various other instruments of transfer and conveyance. Nothing herein
contained shall be deemed to limit or restrict the properties, assets and rights
conveyed, assigned or transferred to or acquired by Assignee by such other
instruments.

                This Assignment and Assumption of Contracts may be executed
simultaneously in several counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.




                                      G - 1


<PAGE>   67



                IN WITNESS WHEREOF, Assignor and Assignee have executed this
Assignment and Assumption of Contracts the _____ day of _____________, 2000.


                                     ASSIGNOR:

                                     __________________, a Tennessee corporation


                                     By:
                                        ----------------------------------------
                                     Title:
                                           -------------------------------------


                                     ASSIGNEE:


                                     ___________________, a Delaware corporation


                                     By:
                                        ----------------------------------------
                                     Title:
                                           -------------------------------------




                                      G - 2


<PAGE>   68



                                    EXHIBIT H

                            HPT ESTOPPEL CERTIFICATE

               THIS ESTOPPEL CERTIFICATE (this "Certificate") is made as of the
_____ day of ___________, 2000, by HOSPITALITY PROPERTIES TRUST, a Maryland real
estate investment trust ("HPT"), and by HPT SUITE PROPERTIES TRUST, a Maryland
real estate investment trust ("Lessor"), to and for the benefit of PRIME
HOSPITALITY CORP., a Delaware corporation, and its successors and assigns
("Prime"), and __________________________, a Delaware corporation and a
wholly-owned subsidiary of Prime, and its successors and assigns ("Assignee").

                              W I T N E S S E T H:

               WHEREAS, by Lease Agreement dated as of November 19, 1997 (the
"Lease Agreement"), Lessor, as landlord, leased to Suite Tenant, Inc., a
Tennessee corporation ("Lessee"), as tenant, certain parcels of land and
improvements thereon as more particularly described in the Lease Agreement; and

               WHEREAS, the Lease Agreement was amended by that certain First
Amendment to Lease Agreement (the "First Amendment") dated as of March 5, 1999,
between Lessor and Lessee; and

               WHEREAS, the Lease Agreement was further amended by that certain
Second Amendment to Lease Agreement and First Amendment to Incidental Documents
(the "Second Amendment") dated as of June 29, 1999, among HPT, Lessor, ShoLodge,
Inc. ("ShoLodge") and Lessee; and

               WHEREAS, the Lease Agreement was further amended by that certain
Third Amendment to Lease Agreement (the "Third Amendment") dated as of March 3,
2000, between Lessor and Lessee (the Lease Agreement as amended by the First
Amendment, the Second Amendment and the Third Amendment is referred to herein
collectively as the "Lease"); and

               WHEREAS, the Lease was guaranteed by ShoLodge pursuant to that
certain Limited Guaranty Agreement dated as of November 19, 1997 (the "Guaranty
Agreement") made by ShoLodge in favor of HPT and Lessor; and

               WHEREAS, the Guaranty Agreement was amended by the Second
Amendment (the Guaranty Agreement as amended by the Second Amendment is referred
to herein collectively as the "Guaranty"); and

               WHEREAS, the obligations of Lessee under the Lease were secured
pursuant to (i) that certain Security Agreement dated as of November 19, 1997
between Lessee and Lessor, such Security Agreement having been amended by the
Second Amendment and by that certain Second Amendment to Security Agreement
dated as of March 3, 2000 between Lessor and Lessee





                                      H - 1


<PAGE>   69



(such Security Agreement as so amended is referred to herein as the "Security
Agreement"), and (ii) that certain Assignment and Security Agreement dated as of
November 19, 1997 between Lessee and Lessor, such Assignment and Security
Agreement having been amended by the Second Amendment (such Assignment and
Security Agreement as amended by the Second Amendment is referred to herein
collectively as the "Assignment and Security Agreement"); and

               WHEREAS, Assignee intends to assume the obligations of Lessee
under the Lease, the Security Agreement and the Assignment and Security
Agreement and to acquire the interest of Lessee under the Lease; and

               WHEREAS, Prime intends to assume the obligations of ShoLodge
under the Guaranty and to acquire the interest of ShoLodge in and to the
"Guaranty Deposit" held by HPT and/or Lessor under the Guaranty; and

               WHEREAS, Assignee would not acquire such leasehold interest and
consummate certain other transactions in connection therewith and Prime would
not assume the obligations of ShoLodge under the Guaranty and acquire the
"Guaranty Deposit" held by HPT and/or Lessor under the Guaranty, but for the
truth and accuracy of the matters set forth in this Certificate.

               NOW, THEREFORE, with the knowledge that Assignee intends to rely
upon the truth of this Certificate in consummating its acquisition of Lessee's
interest as tenant under the Lease and certain related transactions, Lessor
hereby certifies and agrees as follows:

               (1) That Lessor is the landlord under the Lease.

               (2) That attached hereto is a true and accurate copy of the
Lease, the Security Agreement, the Assignment and Security Agreement and the
Guaranty. There are no subordination and/or non-disturbance agreements
pertaining to the Lease granted by Lessor for the benefit of any holder of a
security interest in the leased premises or the improvements thereon.

               (3) That the Lease Agreement has not been modified, changed,
altered or amended in any respect, except as expressly set forth in the First
Amendment, the Second Amendment and the Third Amendment.

               (4) That the Lease has been duly executed and delivered on behalf
of Lessor pursuant to proper authority therefor and constitutes a legally valid
instrument binding and enforceable upon Lessor in accordance with its terms.

               (5) That the term of the Lease commenced on November 19, 1997 and
will expire on June 30, 2011, subject to extension as provided therein.

               (6) That the Lease is in full force and effect and that there
exists no default nor state of facts which with the giving of notice or the
passage of time would constitute a default thereunder on the part of Lessor or
on the part of Lessee.




                                      H - 2


<PAGE>   70




               (7) That Lessee has paid all rent due under the Lease through and
including ____________. No additional charges or fees are due and payable by
Lessee as of the date hereof pursuant to the Lease.

               (8) That the amount of the "Retained Funds" under the Lease is
$21,280,000.00.

               (9) That the amount of the "Guaranty Deposit" described in and
held by HPT and/or Lessor under the Guaranty is $14,000,000.00.

               (10) That there is no cause for HPT or Lessor to offset any
obligation of Lessee under the Lease against the "Guaranty Deposit" described in
and held by HPT and/or Lessor pursuant to the Guaranty.

               (11) That Lessor and HPT each consent to the assignment of the
Lease from Lessee to Assignee including, without limitation, the assignment from
Lessee to Assignee of all of Lessee's right, title and interest in and to the
"Retained Funds" and the "FF&E Reserve" under the Lease, pursuant to the form
attached, and, from and after the effective date of such assignment, Lessor
shall recognize Assignee as the tenant under the Lease.

               (12) That HPT and Lessor each consent to the assignment by
ShoLodge to Prime of all of ShoLodge's right, title and interest in and to the
"Guaranty Deposit" described in and held by HPT and/or Lessor pursuant to the
Guaranty.

               IN WITNESS WHEREOF, HPT and Lessor have executed this Estoppel
Certificate as of the date above first written.


                                         HOSPITALITY PROPERTIES TRUST, a
                                         Maryland real estate investment trust



                                         By:
                                            ------------------------------------
                                         Title:
                                               ---------------------------------


                                         HPT SUITE PROPERTIES TRUST, a Maryland
                                         real estate investment trust


                                         By:
                                            ------------------------------------
                                         Title:
                                              ----------------------------------



                                      H - 3


<PAGE>   71



                                    EXHIBIT I

                              SPECIAL WARRANTY DEED
                            (MT. LAUREL, NEW JERSEY)


Record and Return to:                          Prepared by:

Joseph Bernadino
c/o Prime Hospitality Corp.
P.O. Box 2700                                  ---------------------------------
Fairfield, NJ 07007                            Joseph Bernadino, Esq.


                                      DEED

This Deed is made on ________________, 2000

               BETWEEN

               DELAWARE INNS, INC., a Tennessee corporation, having an address
at 130 Maple Drive North, Hendersonville, Tennessee 37075, hereinafter referred
to as "Grantor,"

               AND

               PRIME HOSPITALITY CORP., a Delaware corporation, having an
address at 700 Route 46 East, Fairfield, New Jersey 07004, hereinafter referred
to as "Grantee."

               TRANSFER OF OWNERSHIP. The Grantor grants and conveys (transfers
ownership of) the property described below to the Grantee. This transfer is made
for the sum of ____________________________________ and _____/100 Dollars
($___________). The Grantor acknowledges receipt of this money.

               TAX MAP REFERENCE. (N.J.S.A. 46:15-1.1 and 46:15-2.1) The
property is designated as Block 1300.03, Lot 5.02 and Lot 6 on the Mount Laurel
Township Tax Map, and Block 1, Lot 3.02 on the Evesham Township Tax Map.

[ ]            No property tax identification number is available on the date of
               this Deed. (Check box if applicable.)

               PROPERTY. The property consists of the land and all the buildings
and structures on the land in the Township of Mount Laurel and Township of
Evesham, County of Burlington and State of New Jersey. The legal description is:

              SEE EXHIBIT A ATTACHED HERETO AND MADE A PART HEREOF.




                                      I - 1


<PAGE>   72



               PROMISES BY GRANTOR. The Grantor promises that the Grantor has
done no act to encumber the property. This promise is called a "covenant as to
grantor's acts" (N.J.S.A. 46:4-6). This promise means that the Grantor has not
allowed anyone else to obtain any legal rights which affect the property (such
as by making a mortgage or allowing a judgment to be entered against the
Grantor)

 SIGNATURES. Grantor signs this Deed as of the date at the top of the first
page.


                                          DELAWARE INNS, INC.

                                          By:
                                             -----------------------------------
                                              Name:
                                                   -----------------------------
                                              Title:
                                                    ----------------------------

STATE OF ____________  :
                           :  SS.
COUNTY OF __________   :

               I CERTIFY that on _____________, 2000, __________________
personally came before me and acknowledged under oath, to my satisfaction, that
this person:

               (a) is the __________ of Delaware Inns, Inc., the Grantor in this
                   Deed;
               (b) signed and delivered this Deed with the full authority of
                   Grantor as the duly authorized act of Grantor; and
               (c) entered into this Deed for the amount of $__________ as the
                   full and actual consideration paid or to be paid.



                                             -----------------------------------
                                             Notary Public or
                                             Attorney at Law of
                                                               -----------------





                                      I - 2


<PAGE>   73



                                    EXHIBIT A

                              PROPERTY DESCRIPTION

That certain parcel of real property situate in the Township of Mount Laurel and
the Township of Evesham, Burlington County, New Jersey, being (i) the property
designated as Proposed Parcel No. 3 (consisting of the property designated on
the Mount Laurel Township Tax Map as Block 1300.03, Lot 5.02, and the property
designated on the Evesham Township Tax Map as Block 1, Lot 3.02), on that
certain map entitled "Final Subdivision Plan Block 1300.03 Lot 5 Mount Laurel
Township & Block 1 Lot 3 Evesham Township Burlington County, New Jersey"
prepared by Marc Associates, Inc., dated September 8, 1997, revised through
January 28, 1998, and recorded on April 6, 1998 in the Burlington County Clerk's
Office as Map No. 3175481, and (ii) the property designated on the Mount Laurel
Township Tax Map as Block 1300.03, Lot 6. The property designated on the Mount
Laurel Township Tax Map as Block 1300.03 Lots 5.02 and 6 was consolidated by
Declaration of Consolidation dated May 4, 1999, recorded on May 28, 1999 in the
Burlington County Clerk's Office in DB 5697, page 565. All such property is more
particularly described according to ALTA/ACSM Land Title Survey of Marc
Associates, Inc. dated May 4, 1998, revised September 19, 1998, September 22,
1998 and October 10, 1998 (Seifert Proj. No. 5018) as follows:

BEGINNING at a point in the Westerly right of way line of New Jersey State
Highway Route 73, said point being the Southerly end of a curve having a radius
of 35 feet, connecting the said right of way line of Route 73 with the Southerly
right of way line of Crawford Place and extending; thence,

(1) Along the said line of Route 73 South 24 degrees 15 minutes 20 seconds East
a distance of 290.60 feet to a point in the division line between Block 1300.03,
Lots 6 and 11.01, thence

(2) South 87 degrees 39 minutes 10 seconds West along the said division line a
distance of 233.02 feet to an angle point in same, thence

(3) South 24 degrees 15 minutes 20 seconds East a distance of 229.97 feet
crossing over the division line between Mt. Laurel and Evesham Townships to a
point in the division line between Block 1, Lot 3.02 and Block 1.12, Lot 1 in
the Township of Evesham, thence

(4) South 01 degrees 53 minutes 20 seconds East along said division line a
distance of 215.46 feet to an angle point in same, thence

(5) South 89 degrees 31 minutes 25 seconds West along said line a distance of
646.40 feet to a point in the division line between Block 1, Lots 3.01 and 3.02,
thence

(6) North 11 degrees 08 minutes 27 seconds West a distance of 553.96 feet
crossing over the division line between Mt. Laurel and Evesham Townships to a
point in the said Southerly right of way line of Crawford Place, thence



                                      I - 3


<PAGE>   74



(7) North 78 degrees 51 minutes 33 seconds East along said right of way line a
distance of 518.52 feet to a point of curvature in same, thence

(8) Curving to the left along said right of way line with a radius of 560.00
feet, an arc distance of 128.08 feet having a central angle of 13 degrees 06
minutes 16 seconds to a point of tangency in same, thence

(9) North 65 degrees 45 minutes 17 seconds East along said right of way line a
distance of 97.07 feet to a point of curvature in same, thence

(10) Curving to the right with a radius of 35 feet, an arc distance of 54.97
feet with a central angle of 89 degrees 59 minutes 23 seconds to the point and
place of BEGINNING.

Containing 10.23 acres of land, more or less.





                                      I - 4


<PAGE>   75



                                    EXHIBIT J

                              SPECIAL WARRANTY DEED
                           (FAIRFAX COUNTY, VIRGINIA)

               THIS DEED, made the ______ day of _____________, 2000, by and
between VIRGINIA INNS, INC., a Tennessee corporation ("Grantor"); and PRIME
HOSPITALITY CORP., a Delaware corporation ("Grantee").

                              W I T N E S S E T H:

               THAT FOR and in consideration of the sum of Ten Dollars ($10.00),
cash in hand paid, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor does hereby grant,
bargain, sell and convey with SPECIAL WARRANTY of title unto Grantee all of that
certain tract or parcel of land more particularly described on Exhibit A
attached hereto and made a part hereof, together with all improvements thereon
and all rights, licenses, easements, benefits and appurtenances thereunto, lying
and being situated in Fairfax County, Virginia (the "Property").

               AND BEING the same property conveyed to Grantor by deed recorded
in Deed Book 10666 at Page 1941, among the land records of Fairfax County,
Virginia (the "Land Records").

               SUBJECT TO all restrictions, covenants, conditions,
rights-of-way, easements and other matters of record, including, without
limitation, the covenants, restrictions, easements, charges and liens set forth
in that certain Declaration of Protective Covenants and Restrictions for
Westfields, The International Corporate Center at Dulles dated January 20, 1986
and recorded among the Land Records in Deed Book 6309 at Page 533, as
subsequently amended (collectively, the "Declaration"). The Declaration shall
run with the land and every part thereof and shall be binding upon and inure to
the benefit of all owners, lessees, licensees and occupants and their successors
as set forth in the Declaration.

               WITNESS the following signature and seal:


                                   VIRGINIA INNS, INC., a Tennessee corporation



                                   By:
                                      ------------------------------------------

                                   Title:
                                         ---------------------------------------




                                      J - 1


<PAGE>   76



STATE OF _______________

COUNTY OF _______________, to wit:


                  The foregoing instrument was acknowledged before me this _____
day of ___________, 2000, by __________________, __________ of VIRGINIA INNS,
INC., a Tennessee corporation, on behalf of the company.



                                                                       (SEAL)
                                              -------------------------
                                              Notary Public

My Commission expires:
                      ---------------------




                                      J - 2


<PAGE>   77



                                    Exhibit A

                           Description of the Property

               Lot 3 (containing 3.5400 acres), Being a Division of Parcel 21-1,
Westfields, The International Corporate Center at Dulles, as the same appears
platted, dedicated and recorded by Deed of Resubdivision recorded in Deed Book
10581, at Page 1482, among the land records of Fairfax County, Virginia

               TOGETHER WITH AND SUBJECT TO a non-exclusive easement for ingress
and egress along the "Common Driveway" and an easement for utilities on both
sides of such "Common Driveway", as set forth in that certain instrument
entitled Ingress-Egress Easement Agreements dated as of April 28, 1988, and
recorded April 28, 1988, in Deed Book 7011 at Page 1281, among the land records
of Fairfax County, Virginia, as amended by instrument entitled Amendment to
Ingress Egress Easement Agreement and Relocation of Common Driveway dated as of
May 14, 1998, and recorded May 15, 1998, in Deed Book 10395 at Page 1222, among
the aforesaid land records.




                                      J - 3


<PAGE>   78








                                    EXHIBIT K

                        AMERISUITES FINISHES AND SIGNAGE
                            PLANS AND SPECIFICATIONS











                                      K - 1


<PAGE>   79








                                    EXHIBIT L

                              OPERATING AGREEMENTS













                                      L - 1


<PAGE>   80



                                    EXHIBIT M

                             EMPLOYEE BENEFIT PLANS

               1. ShoLodge 401(K) Plan, plan number 777853, with the Aetna Life
Insurance and Annuity Company. Plan was effective 01-01-2000 and expires
12-31-2001. Plan is open to all eligible employees. ShoLodge contributes
(matches) 20% of employees first 6% of wages to the plan.

               2. ShoLodge Group Health Plan, group policy GP-602251, effective
01-01- 1999, with Aetna Life Insurance Company. Plan provides for comprehensive
medical coverage, accidental death and dismemberment and life insurance to
certain eligible employees. ShoLodge pays 80% of eligible employees premiums and
50% of employees dependent premiums for those employees who select dependent
coverage.

               3. ShoLodge Employee Handbook for Hotel Operations, dated
01-01-2000. This provides for certain benefits such as vacation, sick pay and
holiday pay for eligible employees.





                                      M - 1


<PAGE>   81



                                    EXHIBIT N

                            PURCHASE PRICE ALLOCATION


         Present Value of HPT Lease Guaranty
         Deposit                                          $11,000,000

         less reserve for operating deficits              $ 9,000,000
                                                          -----------
         Purchase Price                                   $ 2,000,000





                                      N - 1


<PAGE>   82



                                    EXHIBIT O

                            PURCHASE PRICE REDUCTION

<TABLE>
<CAPTION>

         Property                                               Amount
         --------                                               ------
         <S>                                                 <C>
         Tempe, AZ                                          $   94,624

         Tucson, AZ                                             80,220

         Tampa, FL                                              40,525

         Atlanta (Airport), GA                                  96,962

         Atlanta (Gwinnett Mall), GA                           106,488

         Atlanta (Cumberland Mall), GA                          90,212

         Fort Wayne, IN                                         91,098

         Columbus, OH                                          126,084

         Albuquerque, NM                                       108,252

         Hendersonville, TN                                     70,598

         Austin, TX                                             86,758

         El Paso, TX                                            85,986

         Dallas, TX                                            105,166

         San Antonio (Riverwalk), TX                           132,818

         Colorado Springs, CO                                  115,789

         Overland Park, KS                                     116,842

         Irving (Las Colinas), TX                              115,789

         Charlotte, NC                                         107,368

         Alpharetta, GA                                        108,421

         Sterling (Loudoun Tech), VA                           120,000
         ---------------------------                        ----------

         Total                                              $2,000,000

</TABLE>



                                      0 - 1


<PAGE>   83



                                    EXHIBIT P

                               MINIMUM ANNUAL RENT

<TABLE>
<CAPTION>


         Additional Property                                  Amount
         -------------------                                  ------
         <S>                                                <C>
         Pine Knoll Shores, NC                              $  939,000

         Indianapolis, IN                                    1,142,000

         Kansas City, MO                                     1,142,000

         Orlando, FL                                         1,142,000

         Subtotal                                           $4,365,000

<CAPTION>

         Texas Property                                         Amount
         --------------                                         ------
         <S>                                                <C>
         Grand Prairie, TX                                   1,142,000

         Houston (Hobby Airport), TX                         1,032,000

         San Antonio (Crossroads), TX                          884,000

         Subtotal                                           $3,058,000

         Total                                              $7,423,000

</TABLE>



                                      P - 1


<PAGE>   84








                                    EXHIBIT Q

                         RESERVATION SYSTEM REQUIREMENTS











                                      Q - 1