exv4w1



 





EXHIBIT 4.1



 


 

 






FELCOR LODGING LIMITED PARTNERSHIP,

as Issuer,

FELCOR LODGING TRUST INCORPORATED,

FELCOR/CSS HOLDINGS, L.P.,

FELCOR HOTEL ASSET COMPANY, L.L.C.,

FELCOR PENNSYLVANIA COMPANY, L.L.C.,

FELCOR LODGING HOLDING COMPANY, L.L.C.,

FHAC TEXAS HOLDINGS, L.P.,

FELCOR CANADA CO.,

FELCOR OMAHA HOTEL COMPANY, L.L.C.,

FELCOR TRS HOLDINGS, L.P.,

MYRTLE BEACH HOTELS, L.L.C.,

FELCOR TRS BORROWER 1, L.P.,

FELCOR TRS GUARANTOR, L.P.,

CENTER CITY HOTEL ASSOCIATES,

FELCOR LODGING COMPANY, L.L.C.,

FELCOR TRS BORROWER 3, L.P.,

FELCOR TRS BORROWER 4, L.L.C.,

as Guarantors,

FELCOR HOLDINGS TRUST,

as Pledgor,




and




U.S. BANK NATIONAL ASSOCIATION,

as Trustee




 






INDENTURE




Dated as of October 31, 2006




 






Senior Secured Floating Rate Notes due 2011




 

 






 









 





CROSS-REFERENCE TABLE




	 	 	 	 	 
	TIA Sections	 	 	Indenture Sections
	Section 310(a)(1)	 	7.10

	 	(a	)(2)	 	7.10

	 	(b	)	 	7.08

	Section 313(c)	 	7.06; 10.02

	Section 314(a)	 	4.17; 10.02

	 	(a	)(4)	 	4.16; 10.02

	 	(b	)(2)	 	12.02

	 	(c	)(1)	 	10.03

	 	(c	)(2)	 	10.03

	 	(d	)	 	12.04

	 	(e	)	 	10.04

	Section 315(b)	 	7.05; 10.02

	Section 316(a)(1)(A)	 	6.05

	 	(a	)(1)(B)	 	6.04

	 	(b	)	 	6.07

	Section 317(a)(1)	 	6.08

	 	(a	)(2)	 	6.09

	Section 318(a)	 	10.01

	 	(c	)	 	10.01









 




			
	* Note:	 	The Cross-Reference Table shall not for any purpose be deemed to be a part of the
Indenture.






2









 








TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page
	 

	 	ARTICLE I	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	DEFINITIONS AND INCORPORATION BY REFERENCE	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 1.01.

	 	Definitions
	 	 	1	 
	SECTION 1.02.

	 	Incorporation by Reference of Trust Indenture Act
	 	 	19	 
	SECTION 1.03.

	 	Rules of Construction
	 	 	19	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE II	 	 	 	 
	 
	 

	 	NOTES	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 2.01.

	 	Form and Dating
	 	 	20	 
	SECTION 2.02.

	 	Restrictive Legends
	 	 	21	 
	SECTION 2.03.

	 	Execution, Authentication and Denominations
	 	 	22	 
	SECTION 2.04.

	 	Registrar and Paying Agent
	 	 	22	 
	SECTION 2.05.

	 	Paying Agent To Hold Money in Trust
	 	 	23	 
	SECTION 2.06.

	 	Transfer and Exchange
	 	 	23	 
	SECTION 2.07.

	 	Book-Entry Provisions for Global Notes
	 	 	24	 
	SECTION 2.08.

	 	Special Transfer Provisions
	 	 	25	 
	SECTION 2.09.

	 	Replacement Notes
	 	 	27	 
	SECTION 2.10.

	 	Outstanding Notes
	 	 	27	 
	SECTION 2.11.

	 	Temporary Notes
	 	 	28	 
	SECTION 2.12.

	 	Cancellation
	 	 	28	 
	SECTION 2.13.

	 	CUSIP Numbers
	 	 	28	 
	SECTION 2.14.

	 	Defaulted Interest
	 	 	28	 
	SECTION 2.15.

	 	Issuance of Additional Notes
	 	 	28	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE III	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	REDEMPTION	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 3.01.

	 	Optional Redemption
	 	 	28	 
	SECTION 3.02.

	 	Notices to Trustee
	 	 	29	 
	SECTION 3.03.

	 	Selection of Notes To Be Redeemed
	 	 	29	 
	SECTION 3.04.

	 	Notice of Redemption
	 	 	29	 
	SECTION 3.05.

	 	Effect of Notice of Redemption
	 	 	30	 
	SECTION 3.06.

	 	Deposit of Redemption Price
	 	 	30	 
	SECTION 3.07.

	 	Payment of Notes Called for Redemption
	 	 	30	 
	SECTION 3.08.

	 	Notes Redeemed in Part
	 	 	30	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE IV	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	COVENANTS	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 4.01.

	 	Payment of Notes
	 	 	30	 
	SECTION 4.02.

	 	Maintenance of Office or Agency
	 	 	31	 
	SECTION 4.03.

	 	Limitation on Indebtedness
	 	 	31	 
	SECTION 4.04.

	 	Limitation on Restricted Payments
	 	 	33	 
	SECTION 4.05.

	 	Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries
	 	 	36	 
	SECTION 4.06.

	 	Limitation on the Issuance and Sale of Capital Stock of Restricted Subsidiaries
	 	 	37	 
	SECTION 4.07.

	 	Limitation on Issuances of Guarantees by Restricted Subsidiaries
	 	 	37	 






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	 	 	 	 	Page
	SECTION 4.08.

	 	Limitation on

Transactions with Affiliates
	 	 	38	 
	SECTION 4.09.

	 	Limitation on

Liens
	 	 	38	 
	SECTION 4.10.

	 	Limitation on Asset Sales
	 	 	39	 
	SECTION

4.11.

	 	Repurchase of Notes upon a Change of Control
	 	 	39	 
	SECTION

4.12.

	 	Existence
	 	 	40	 
	SECTION 4.13.

	 	Payment of Taxes and Other Claims
	 	 	40	 
	SECTION 4.14.

	 	Maintenance of Properties and Insurance
	 	 	40	 
	SECTION 4.15.

	 	Notice of Defaults
	 	 	40	 
	SECTION 4.16.

	 	Compliance Certificates
	 	 	40	 
	SECTION 4.17.

	 	Commission

Reports and Reports to Holders
	 	 	41	 
	SECTION 4.18.

	 	Waiver of

Stay, Extension or Usury Laws
	 	 	41	 
	SECTION 4.19.

	 	Limitation on

Sale-Leaseback Transactions
	 	 	41	 
	SECTION 4.20.

	 	Maintenance

of Total Unencumbered Assets
	 	 	41	 
	SECTION 4.21.

	 	Investment

Grade Rating
	 	 	42	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE

V	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	SUCCESSOR CORPORATION	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 5.01.

	 	Consolidation, Merger and Sale of Assets
	 	 	42	 
	SECTION 5.02.

	 	Successor Substituted
	 	 	42	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE

VI	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	DEFAULT AND REMEDIES	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 6.01.

	 	Events of Default
	 	 	43	 
	SECTION 6.02.

	 	Acceleration
	 	 	44	 
	SECTION 6.03.

	 	Other

Remedies
	 	 	45
	 
	SECTION 6.04.

	 	Waiver of Past Defaults
	 	 	45	 
	SECTION

6.05.

	 	Control by Majority
	 	 	45	 
	SECTION 6.06.

	 	Limitation on Suits
	 	 	45	 
	SECTION 6.07.

	 	Rights of Holders To Receive Payment
	 	 	46	 
	SECTION 6.08.

	 	Collection Suit by Trustee
	 	 	46
	 
	SECTION 6.09.

	 	Trustee May

File Proofs of Claim
	 	 	46	 
	SECTION 6.10.

	 	Priorities
	 	 	46	 
	SECTION 6.11.

	 	Undertaking for Costs
	 	 	46	 
	SECTION

6.12.

	 	Restoration of Rights and Remedies
	 	 	47	 
	SECTION

6.13.

	 	Rights and Remedies Cumulative
	 	 	47	 
	SECTION

6.14.

	 	Delay or Omission Not Waiver
	 	 	47	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE VII	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	TRUSTEE	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 7.01.

	 	General
	 	 	47	 
	SECTION 7.02.

	 	Certain Rights of Trustee
	 	 	47	 
	SECTION

7.03.

	 	Individual Rights of Trustee
	 	 	48	 
	SECTION

7.04.

	 	Trustee’s Disclaimer
	 	 	48	 
	SECTION 7.05.

	 	Notice of Default
	 	 	48	 
	SECTION 7.06.

	 	Reports by Trustee to Holders
	 	 	48	 
	SECTION 7.07.

	 	Compensation and Indemnity
	 	 	48	 
	SECTION 7.08.

	 	Replacement of Trustee
	 	 	49	 
	SECTION 7.09.

	 	Successor Trustee by Merger, Etc.
	 	 	50	 
	SECTION 7.10.

	 	Eligibility
	 	 	50	 






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	 	 	 	 	Page
	SECTION 7.11.

	 	Money Held in Trust
	 	 	50	 
	SECTION 7.12.

	 	Withholding Taxes
	 	 	50	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE VIII	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	DISCHARGE OF INDENTURE	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 8.01.

	 	Termination of Company’s Obligations
	 	 	50	 
	SECTION 8.02.

	 	Defeasance and Discharge of Indenture
	 	 	51	 
	SECTION 8.03.

	 	Defeasance of Certain Obligations
	 	 	53	 
	SECTION 8.04.

	 	Application of Trust Money
	 	 	54	 
	SECTION 8.05.

	 	Repayment to Company
	 	 	54	 
	SECTION 8.06.

	 	Reinstatement
	 	 	54	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE IX	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	AMENDMENTS, SUPPLEMENTS AND WAIVERS	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 9.01.

	 	Without Consent of Holders
	 	 	54	 
	SECTION 9.02.

	 	With Consent of Holders
	 	 	55	 
	SECTION 9.03.

	 	Revocation and Effect of Consent
	 	 	56	 
	SECTION 9.04.

	 	Notation on or Exchange of Notes
	 	 	56	 
	SECTION 9.05.

	 	Trustee To Sign Amendments, Etc.
	 	 	56	 
	SECTION 9.06.

	 	Conformity with Trust Indenture Act
	 	 	56	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE X	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	MISCELLANEOUS	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 10.01.

	 	Trust Indenture Act of 1939
	 	 	56	 
	SECTION 10.02.

	 	Notices
	 	 	57	 
	SECTION 10.03.

	 	Certificate and Opinion as to Conditions Precedent
	 	 	57	 
	SECTION 10.04.

	 	Statements Required in Certificate or Opinion
	 	 	58	 
	SECTION 10.05.

	 	Rules by Trustee, Paying Agent or Registrar
	 	 	58	 
	SECTION 10.06.

	 	Payment Date Other Than a Business Day
	 	 	58	 
	SECTION 10.07.

	 	Governing Law
	 	 	58	 
	SECTION 10.08.

	 	No Adverse Interpretation of Other Agreements
	 	 	58	 
	SECTION 10.09.

	 	No Recourse Against Others
	 	 	58	 
	SECTION 10.10.

	 	Successors
	 	 	58	 
	SECTION 10.11.

	 	Duplicate Originals
	 	 	58	 
	SECTION 10.12.

	 	Separability
	 	 	59	 
	SECTION 10.13.

	 	Table of Contents, Headings, Etc.
	 	 	59	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE XI	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	GUARANTEE OF THE NOTES	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 11.01.

	 	Guarantee
	 	 	59	 
	SECTION 11.02.

	 	Obligations of Guarantor Unconditional
	 	 	60	 
	SECTION 11.03.

	 	Notice to Trustee
	 	 	60	 
	SECTION 11.04.

	 	This Article Not To Prevent Events of Default
	 	 	60	 
	SECTION 11.05.

	 	Trustee’s Compensation Not Prejudiced
	 	 	60	 
	SECTION 11.06.

	 	Payments May Be Paid Prior to Dissolution
	 	 	60	 
	SECTION 11.07.

	 	Release of Guarantee
	 	 	60	 






-iii-









 






	 	 	 	 	 	 	 
	 	 	 	 	Page
	 

	 	ARTICLE XII	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	SECURITY	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 12.01.

	 	Security
	 	 	60	 
	SECTION 12.02.

	 	Recording and Opinions
	 	 	61	 
	SECTION 12.03.

	 	Release and Disposition of Collateral
	 	 	61	 
	SECTION 12.04.

	 	Enforcement of Claims Against Pledged Collateral
	 	 	62	 
	SECTION 12.05.

	 	Authorization of Actions To Be Taken by the Trustee
	 	 	62	 
	SECTION 12.06.

	 	General Partner Interest in FelCor LP
	 	 	62	 
	SECTION 12.07.

	 	Appointment of Collateral Agent
	 	 	62	 
	SECTION 12.08.

	 	Limitation on Liability
	 	 	62	 






-iv-









 





     INDENTURE, dated as of October 31, 2006, among FelCor Lodging Limited Partnership (“FelCor
LP”), a Delaware limited partnership, FelCor Lodging Trust Incorporated (“FelCor”), a Maryland
corporation, FelCor/CSS Holdings, L.P., a Delaware limited partnership; FelCor Hotel Asset Company,
L.L.C., a Delaware limited liability company; FelCor Pennsylvania Company, L.L.C., a Delaware
limited liability company; FelCor Lodging Holding Company, L.L.C., a Delaware limited liability
company; FHAC Texas Holdings, L.P., a Texas limited partnership; FelCor Canada Co., a Nova Scotia
unlimited liability company; FelCor Omaha Hotel Company, L.L.C., a Delaware limited liability
company; FelCor TRS Holdings, L.P., a Delaware limited partnership; Myrtle Beach Hotels, L.L.C., a
Delaware limited liability company; FelCor TRS Borrower 1, L.P., a Delaware limited partnership;
FelCor TRS Guarantor, L.P., a Delaware limited partnership; Center City Hotel Associates, a
Pennsylvania limited partnership; FelCor Lodging Company, L.L.C., a Delaware limited liability
company; FelCor TRS Borrower 3, L.P., a Delaware limited partnership; FelCor TRS Borrower 4, L.C.,
a Delaware limited liability company; and U.S. Bank National Association, a national banking
association, as trustee (the “Trustee”) and FelCor Holdings Trust, a Massachusetts business trust,
as pledgor (the “Pledgor”).



RECITALS OF COMPANY




     FelCor LP has duly authorized the execution and delivery of this Indenture to provide for the
issuance initially of up to $215,000,000 aggregate principal amount at maturity of FelCor LP’s
Senior Secured Floating Rate Notes Due 2011 (the “Notes”) issuable as provided in this Indenture.
Each Guarantor has duly authorized the execution and delivery of this Indenture to provide for a
guarantee of the Notes and of certain of FelCor LP’s obligations hereunder. All things necessary
to make this Indenture a valid agreement of FelCor LP and the Guarantors in accordance with its
terms have been done, and FelCor LP and the Guarantors have done all things necessary to make the
Notes, when executed by FelCor LP and authenticated and delivered by the Trustee hereunder and duly
issued by FelCor LP, the valid obligations of FelCor LP and the Guarantors as hereinafter provided.



     This Indenture is subject to, and shall be governed by, the provisions of the Trust Indenture
Act of 1939, as amended, that are required to be a part of and to govern indentures qualified under
the Trust Indenture Act of 1939, as amended.



AND THIS INDENTURE FURTHER WITNESSETH




     For and in consideration of the premises and the purchase of the Notes by the Holders thereof,
it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders, as
follows:



ARTICLE I




DEFINITIONS AND INCORPORATION BY REFERENCE




     SECTION 1.01. Definitions.



     “Acquired Indebtedness” means Indebtedness of a Person existing at the time such Person
becomes a Restricted Subsidiary or assumed in connection with an Asset Acquisition from such Person
by a Restricted Subsidiary and not incurred by such Person in connection with, or in anticipation
of, such Person becoming a Restricted Subsidiary or such Asset Acquisition; provided that
Indebtedness of such Person that is redeemed, defeased, retired or otherwise repaid at the time of
or immediately upon consummation of the transactions by which such Person becomes a Restricted
Subsidiary or such Asset Acquisition shall not be Acquired Indebtedness.



     “Adjusted Consolidated Net Income” means, for any period, the aggregate net income (or loss)
of FelCor, FelCor LP and their respective Restricted Subsidiaries for such period determined on a
consolidated basis in conformity with GAAP (without taking into account Unrestricted Subsidiaries)
plus the minority interest in FelCor LP, if applicable; provided that the following items shall be
excluded in computing Adjusted Consolidated Net Income, without duplication:



 









 






     (i) the net income (or loss) of any Person, other than FelCor LP, FelCor or a
Restricted Subsidiary, except to the extent of the amount of dividends or other
distributions actually paid to FelCor LP, FelCor or any of their respective Restricted
Subsidiaries by such Person during such period;




     (ii) the net income (or loss) of any Restricted Subsidiary to the extent that the
declaration or payment of dividends or similar distributions by such Restricted Subsidiary
of such net income is not at the time permitted by the operation of the terms of its charter
or any agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to such Restricted Subsidiary;




     (iii) any after-tax gains or losses attributable to Asset Sales;




     (iv) for so long as the Notes are not rated Investment Grade, any amount paid or
accrued as dividends on Preferred Stock of FelCor LP, FelCor or any Restricted Subsidiary
owned by Persons other than FelCor or FelCor LP and any of their respective Restricted
Subsidiaries; and




     (v) all extraordinary gains and extraordinary losses.



     “Adjusted Consolidated Net Tangible Assets” means the total amount of assets of FelCor LP,
FelCor and their respective Restricted Subsidiaries (less applicable depreciation, amortization and
other valuation reserves), except to the extent resulting from write-ups of capital assets
(excluding write-ups in connection with accounting for acquisitions in conformity with GAAP), after
deducting from the total amount of assets:




     (i) all current liabilities of FelCor LP, FelCor and their respective Restricted
Subsidiaries, excluding intercompany items, and




     (ii) all goodwill, trade names, trademarks, patents, unamortized debt discount and
expense and other like intangibles, all as set forth on the most recent quarterly or annual
consolidated balance sheet of FelCor LP or FelCor and their respective Restricted
Subsidiaries, prepared in conformity with GAAP and filed with the Commission or provided to
the Trustee pursuant to Section 4.17.



     “Adjusted Total Assets” means, for any Person, the sum of :




     (i) Total Assets for such Person as of the end of the calendar quarter preceding the
Transaction Date as set forth on the most recent quarterly or annual consolidated balance
sheet of FelCor LP or FelCor and their respective Restricted Subsidiaries, prepared in
conformity with GAAP and filed with the Commission or provided to the Trustee pursuant to
Section 4.17, and




     (ii) any increase in Total Assets following the end of such quarter including, without
limitation, any increase in Total Assets resulting from the application of the proceeds of
any additional Indebtedness.



     “Administrative Agent” means the relevant agent bank, if any, under any Line of Credit
established by FelCor, and such agent bank’s successors and assigns.



     “Affiliate” means, as applied to any Person, any other Person directly or indirectly
controlling, controlled by, or under direct or indirect common control with, such Person. For
purposes of this definition, “control” (including, with correlative meanings, the terms
“controlling,” “controlled by” and “under common control with”), as applied to any Person, means
the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting securities, by
contract or otherwise.



     “Agent” means any Registrar, Paying Agent, authenticating agent or co-Registrar.



     “Agent Members” has the meaning provided in Section 2.07(a).



-2-









 





     “Asset Acquisition” means:




     (i) an investment by FelCor LP or FelCor or any of their respective Restricted
Subsidiaries in any other Person pursuant to which such Person shall become a Restricted
Subsidiary or shall be merged into or consolidated with FelCor LP or FelCor or any of their
respective Restricted Subsidiaries; provided that such Person’s primary business is related,
ancillary, incidental or complementary to the businesses of FelCor LP or FelCor or any of
their respective Restricted Subsidiaries on the date of such investment; or




     (ii) an acquisition by FelCor LP or FelCor or any of their respective Restricted
Subsidiaries from any other Person that constitutes substantially all of a division or line
of business, or one or more hotel properties, of such Person; provided that the property and
assets acquired are related, ancillary, incidental or complementary to the businesses of
FelCor LP or FelCor or any of their respective Restricted Subsidiaries on the date of such
acquisition.



     “Asset Disposition” means the sale or other disposition by FelCor LP or FelCor or any of their
respective Restricted Subsidiaries, other than to FelCor LP, FelCor or another Restricted
Subsidiary, of:




     (i) all or substantially all of the Capital Stock of any Restricted Subsidiary, or




     (ii) all or substantially all of the assets that constitute a division or line of
business, or one or more hotel properties, of FelCor LP or FelCor or any of their respective
Restricted Subsidiaries.



     “Asset Sale” means any sale, transfer or other disposition, including by way of merger,
consolidation or sale-leaseback transaction, in one transaction or a series of related transactions
by FelCor LP or FelCor or any of their Restricted Subsidiaries to any Person other than FelCor LP
or FelCor or any of their respective Restricted Subsidiaries of:




     (i) all or any of the Capital Stock of any Restricted Subsidiary other than sales
permitted under clause (iv) of Section 4.06,




     (ii) all or substantially all of the property and assets of an operating unit or
business of FelCor LP or FelCor or any of their respective Restricted Subsidiaries, or




     (iii) any other property and assets of FelCor LP or FelCor or any of their respective
Restricted Subsidiaries outside the ordinary course of business of FelCor LP or FelCor or
such Restricted Subsidiary and, in each case, that is not governed by the provisions of this
Indenture applicable to mergers, consolidations and sales of assets of FelCor LP and FelCor;


provided that “Asset Sale” shall not include:





     (a) sales or other dispositions of inventory, receivables and other current assets,




     (b) sales, transfers or other dispositions of assets with a fair market value not in
excess of $1 million in any transaction or series of related transactions, or




     (c) sales or other dispositions of assets for consideration at least equal to the fair
market value of the assets sold or disposed of, to the extent that the consideration
received would satisfy the requirements set forth in clause (i)(B) of the second paragraph
of Section 4.10.



     “Average Life” means at any date of determination with respect to any debt security, the
quotient obtained by dividing:




     (i) the sum of the products of:



-3-









 






     (a) the number of years from such date of determination to the dates of each
successive scheduled principal payment of such debt security, and




     (b) the amount of such principal payment; by




     (ii) the sum of all such principal payments.



     “Board of Directors” means (i) with respect to FelCor, the Board of Directors of FelCor, (ii)
with respect to FelCor LP, the Board of Directors of its general partner, and (iii) with respect to
the Subsidiary Guarantors, the board of directors of its general partner or manager, as the case
may be, or, in each case, any committee of such Board of Directors duly authorized to act under
this Indenture.



     “Board Resolution” means a copy of a resolution, certified by the Secretary of such Person to
have been duly adopted by the Board of Directors and to be in full force and effect on the date of
such certification, and delivered to the Trustee.



     “Business Day” means any day except a Saturday, Sunday or other day on which commercial banks
in The City of New York, or in the city of the Corporate Trust Office of the Trustee, are
authorized by law to close.



     “Capital Stock” means, with respect to any Person, any and all shares, interests,
participation or other equivalents (however designated, whether voting or non-voting), including
partnership interests, whether general or limited, in the equity of such Person, whether
outstanding on the Closing Date or issued thereafter, including, without limitation, all Common
Stock, Preferred Stock and Units.



     “Capitalized Lease” means, as applied to any Person, any lease of any property, whether real,
personal or mixed, of which the discounted present value of the rental obligations of such Person
as lessee, in conformity with GAAP, is required to be capitalized on the balance sheet of such
Person.



     “Capitalized Lease Obligations” means, as applied to any Person, the discounted present value
of the rental obligations under a Capitalized Lease as reflected on the balance sheet of such
Person in accordance with GAAP.



     “Change of Control” means such time as:




     (i) a “person” or “group” (as such terms are defined in Sections 13(d) and 14(d)(2) of
the Exchange Act), becomes the ultimate “beneficial owner” (as defined in Rule 13d-3 under
the Exchange Act) of more than 35% of the total voting power of the Voting Stock of FelCor
or, other than by FelCor, of FelCor LP on a fully diluted basis; or




     (ii) individuals who on the Closing Date constitute the Board of Directors of FelCor
(together with any new or replacement directors whose election by the Board of Directors or
whose nomination by the Board of Directors for election by FelCor’s shareholders was
approved by a vote of at least a majority of the members of the Board of Directors then
still in office who either were members of the Board of Directors on the Closing Date or
whose election or nomination for election was so approved) cease for any reason to
constitute a majority of the members of the Board of Directors then in office.



     “Closing Date” means October 31, 2006.



     “Collateral” means any property, assets, proceeds or other items that may be pledged as
security for the Notes, whether pursuant to Section 4.09, Article Twelve or otherwise.



     “Collateral Agency Agreement” means an agreement among FelCor, FelCor LP, the Trustee, the
Collateral Agent, the Administrative Agent and the trustees for the 81/2% Senior Notes due 2011 and
75/8% Senior Notes due 2007, substantially in the form attached as Exhibit E to this Indenture.



     “Collateral Agent” has the meaning provided in Section 12.07.



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     “Collateral Documents” means, collectively, the Collateral Agency Agreement, the Pledge
Agreement, and any other security agreement, financing statement or other document applicable to
the Collateral, each as in effect at the Closing Date and as amended from time to time as permitted
by the Indenture.



     “Commission” means the Securities and Exchange Commission, as from time to time constituted,
created under the Exchange Act or, if at any time after the execution of this Indenture such
Commission is not existing and performing the duties now assigned to it under the TIA, then the
body performing such duties at such time.



     “Common Stock” means, with respect to any Person, any and all shares, interests,
participations or other equivalents (however designated, whether voting or non-voting) that have no
preference on liquidation or with respect to distributions over any other class of Capital Stock,
including partnership interests, whether general or limited, of such Person’s equity, whether
outstanding on the Closing Date or issued thereafter, including, without limitation, all series and
classes of common stock.



     “Company Order” means a written request or order signed in the name of a Person (i) by its
Chairman, a Vice Chairman, its President, a Vice President, manager or similar officer of its
general partner and (ii) by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant
Secretary, manager or similar officer of its general partner and delivered to the Trustee;
provided, however, that such written request or order may be signed by any two of the officers or
directors listed in clause (i) above in lieu of being signed by one of such officers or directors
listed in such clause (i) and one of the officers listed in clause (ii) above.



     “Consolidated EBITDA” means, for any period, Adjusted Consolidated Net Income for such period
plus, to the extent such amount was deducted in calculating such Adjusted Consolidated Net Income:




     (i) Consolidated Interest Expense,




     (ii) income taxes (other than income taxes (either positive or negative) attributable
to extraordinary and non-recurring gains or losses or sales of assets),




     (iii) depreciation expense,




     (iv) amortization expense, and




     (v) all other non-cash items reducing Adjusted Consolidated Net Income (other than
items that will require cash payments and for which an accrual or reserve is, or is required
by GAAP to be, made),


less all non-cash items increasing Adjusted Consolidated Net Income, all as determined on a
consolidated basis for FelCor LP, FelCor and their respective Restricted Subsidiaries in conformity
with GAAP; provided that, if any Restricted Subsidiary is not a Wholly Owned Restricted Subsidiary,
Consolidated EBITDA shall be reduced (to the extent not otherwise reduced in accordance with GAAP)
by an amount equal to:





     (a) the amount of the Adjusted Consolidated Net Income attributable to such Restricted
Subsidiary multiplied by




     (b) the percentage ownership interest in the income of such Restricted Subsidiary not
owned on the last day of such period by FelCor LP or FelCor or any of their respective
Restricted Subsidiaries.



     “Consolidated Interest Expense” means, for any period, without duplication, the aggregate
amount of interest expense in respect of Indebtedness of FelCor, FelCor LP and their respective
Restricted Subsidiaries during such period, all as determined on a consolidated basis (without
taking into account Unrestricted Subsidiaries) in conformity with GAAP, including, without
limitation:




     (a) amortization of original issue discount on any Indebtedness and the interest
portion of any deferred payment obligation, calculated in accordance with GAAP;



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     (b) all commissions, discounts and other fees and expenses owed with respect to letters
of credit and bankers’ acceptance financing;




     (c) the net costs associated with Interest Rate Agreements and Indebtedness that is
Guaranteed or secured by assets of FelCor LP, FelCor or any of their respective Restricted
Subsidiaries; and




     (d) all but the principal component of rentals in respect of Capitalized Lease
Obligations paid, accrued or scheduled to be paid or to be accrued by FelCor LP, FelCor and
their respective Restricted Subsidiaries;


excluding (i) the amount of such interest expense of any Restricted Subsidiary if the net income of
such Restricted Subsidiary is excluded in the calculation of Adjusted Consolidated Net Income
pursuant to clause (ii) of the definition thereof (but only in the same proportion as the net
income of such Restricted Subsidiary is excluded from the calculation of Adjusted Consolidated Net
Income pursuant to clause (ii) of the definition thereof) and (ii) any premiums, fees and expenses
(and any amortization thereof) payable in connection with the offering of the Notes or paid in
connection with any other Indebtedness outstanding on June 30, 2000, all as determined on a
consolidated basis (without taking into account Unrestricted Subsidiaries) in conformity with GAAP.




     “Corporate Trust Office” means the office of the Trustee at which the corporate trust business
of the Trustee shall, at any particular time, be principally administered, which office is, at the
date of this Indenture, located at 60 Livingston Avenue, EP-MN-WS3C, St. Paul, Minnesota
55107-2292, Attention: Corporate Trust Administration.



     “Currency Agreement” means any foreign exchange contract, currency swap agreement or other
similar agreement or arrangement.



     “Default” means any event that is, or after notice or passage of time or both would be, an
Event of Default.



     “Depositary” means The Depository Trust Company, its nominees and their respective successors.



     “Disqualified Stock” means any class or series of Capital Stock of any Person that by its
terms or otherwise is:




     (i) required to be redeemed prior to the Stated Maturity of the Notes,




     (ii) redeemable at the option of the holder of such class or series of Capital Stock,
other than Units, at any time prior to the Stated Maturity of the Notes, or




     (iii) convertible into or exchangeable for Capital Stock referred to in clause (i) or
(ii) above or Indebtedness having a scheduled maturity prior to the Stated Maturity of the
Notes;


provided that any Capital Stock that would not constitute Disqualified Stock but for provisions
thereof giving holders thereof the right to require such Person to repurchase or redeem such
Capital Stock upon the occurrence of an “asset sale” or “change of control” occurring prior to the
Stated Maturity of the Notes shall not constitute Disqualified Stock if the “asset sale” or “change
of control” provisions applicable to such Capital Stock are no more favorable to the holders of
such Capital Stock than the provisions contained in Sections 4.10 and 4.11 and such Capital Stock
specifically provides that such Person will not repurchase or redeem any such stock pursuant to
such provisions prior to FelCor LP’s repurchase of such Notes as are required to be repurchased
pursuant to Sections 4.10 and 4.11.




     “Equity Offering” means a public or private offering of Capital Stock (other than Disqualified
Stock) of FelCor or FelCor LP; provided that the proceeds received by FelCor or FelCor LP directly
or indirectly from such offering are not less than $50,000,000.



     “Event of Default” has the meaning provided in Section 6.01.



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     “Excess Proceeds” has the meaning provided in Section 4.10.



     “Exchange Act” means the Securities Exchange Act of 1934, as amended.



     “Exchange Notes” means any securities of FelCor LP containing terms identical to the Notes
(except that such Exchange Notes shall be registered under the Securities Act) that are issued and
exchanged for such Notes pursuant to the Registration Rights Agreement (or, with respect to Notes
issued after the Closing Date, pursuant to a registration rights agreement with substantially the
same terms and conditions as the Registration Rights Agreement) and this Indenture.



     “Existing Senior Notes” means FelCor LP’s outstanding 7 5/8% Senior Notes due 2007, 8 1/2%
Senior Notes due 2011 and Senior Floating Rate Notes due 2011.



     “fair market value” means the price that would be paid in an arm’s-length transaction between
an informed and willing seller under no compulsion to sell and an informed and willing buyer under
no compulsion to buy, as determined in good faith by the Board of Directors, whose determination
shall be conclusive if evidenced by a Board Resolution.



     “Funds From Operations” for any period means the consolidated net income of FelCor LP, FelCor
and their respective Restricted Subsidiaries for such period in conformity with GAAP (without
taking into account Unrestricted Subsidiaries) excluding gains or losses from debt restructurings
and sales of depreciable operating property, plus depreciation of real property (including
furniture and equipment) and amortization related to real property and other non-cash charges
related to real property, after adjustments for unconsolidated partnerships and joint ventures plus
the minority interest in FelCor LP, if applicable; provided that for purposes of the payment of any
dividend or distribution by FelCor LP or FelCor, “Funds From Operations” shall be equal to $80
million plus the amount thereof computed for the period commencing with July 1, 2000 and ending on
the last day of the last fiscal quarter preceding the payment of such dividend or distribution.



     “GAAP” means generally accepted accounting principles in the United States of America as in
effect as of July 1, 2000, including, without limitation, those set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as approved by a significant segment of the accounting
profession. All ratios and computations contained or referred to in this Indenture shall be
computed in conformity with GAAP applied on a consistent basis, except that calculations made for
purposes of determining compliance with the terms of the covenants and with other provisions of
this Indenture shall be made without giving effect to:




     (i) the amortization of any expenses incurred in connection with the offering of the
Notes, and




     (ii) except as otherwise provided, the amortization of any amounts required or
permitted by Accounting Principles Board Opinion Nos. 16 and 17.



     “Global Notes” has the meaning provided in Section 2.01.



     “Government Securities” means direct obligations of, obligations guaranteed by, or
participations in pools consisting solely of obligations of or obligations guaranteed by, the
United States of America for the payment of which obligations or guarantee the full faith and
credit of the United States of America is pledged and that are not callable or redeemable at the
option of the issuer thereof.



     “Guarantee” means any obligation, contingent or otherwise, of any Person directly or
indirectly guaranteeing any Indebtedness of any other Person and, without limiting the generality
of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person:



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     (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or
by agreements to keep-well, to purchase assets, goods, securities or services (unless such
purchase arrangements are on arm’s-length terms and are entered into in the ordinary course
of business), to take-or-pay, or to maintain financial statement conditions or otherwise),
or




     (ii) entered into for purposes of assuring in any other manner the obligee of such
Indebtedness of the payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part);


provided that the term “Guarantee” shall not include (a) endorsements for collection or deposit in
the ordinary course of business or (b) a guarantee by FelCor LP or FelCor of Indebtedness of a
Subsidiary of FelCor LP that is recourse (except upon the occurrence of certain events set forth in
the instruments governing such Indebtedness, including, without limitation, fraud, misapplication
of funds or other customary recourse provisions) solely to assets pledged to secure such
Indebtedness, for so long as such guarantee may not be enforced against FelCor LP or FelCor by the
holder of such Indebtedness (except upon the occurrence of such an event), provided that upon the
occurrence of such an event, such guarantee shall be deemed to be the Incurrence of a “Guarantee”
and at the time of such Incurrence and during such period as such guarantee may be enforced against
FelCor LP or FelCor by the holder of such Indebtedness, such guarantee shall be deemed to be a
“Guarantee” for all purposes under this Indenture. The term “Guarantee” used as a verb has a
corresponding meaning.




     “Guaranteed Indebtedness” has the meaning provided in Section 4.07.



     “Guarantors” means FelCor and the Subsidiary Guarantors, collectively.



     “Holder” or “Noteholder” means the registered holder of any Note.



     “Incur” means, with respect to any Indebtedness, to incur, create, issue, assume, Guarantee or
otherwise become liable for or with respect to, or become responsible for, the payment of,
contingently or otherwise, such Indebtedness, including an “Incurrence” of Acquired Indebtedness;
provided that neither the accrual of interest nor the accretion of original issue discount shall be
considered an Incurrence of Indebtedness.



     “Indebtedness” means, with respect to any Person at any date of determination (without
duplication):




     (i) all indebtedness of such Person for borrowed money;




     (ii) all obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;




     (iii) the face amount of letters of credit or other similar instruments (excluding
obligations with respect to letters of credit (including trade letters of credit) securing
obligations (other than obligations described in (i) or (ii) above or (v), (vi) or (vii)
below) entered into in the ordinary course of business of such Person to the extent such
letters of credit are not drawn upon or, if drawn upon, to the extent such drawing is
reimbursed no later than the third Business Day following receipt by such Person of a demand
for reimbursement);




     (iv) all unconditional obligations of such Person to pay the deferred and unpaid
purchase price of property or services, which purchase price is due more than six months
after the date of placing such property in service or taking delivery and title thereto or
the completion of such services, except Trade Payables;




     (v) all Capitalized Lease Obligations;




     (vi) all Indebtedness of other Persons secured by a Lien on any asset of such Person,
whether or not such Indebtedness is assumed by such Person; provided that the amount of such
Indebtedness shall



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be the lesser of (A) the fair market value of such asset at such date of determination and
(B) the amount of such Indebtedness;




     (vii) all Indebtedness of other Persons Guaranteed by such Person to the extent such
Indebtedness is Guaranteed by such Person; and




     (viii) to the extent not otherwise included in this definition or the definition of
Consolidated Interest Expense, obligations under Currency Agreements and Interest Rate
Agreements.


The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date
of all unconditional obligations of the type described above and, with respect to obligations under
any Guarantee, the maximum liability upon the occurrence of the contingency giving rise to the
obligation; provided that:





     (A) the amount outstanding at any time of any Indebtedness issued with original issue
discount shall be deemed to be the face amount with respect to such Indebtedness less the
remaining unamortized portion of the original issue discount of such Indebtedness at the
date of determination in conformity with GAAP, and




     (B) Indebtedness shall not include any liability for federal, state, local or other
taxes.



     “Indenture” means this Indenture as originally executed or as it may be amended or
supplemented from time to time by one or more indentures supplemental to this Indenture entered
into pursuant to the applicable provisions of this Indenture.



     “Institutional Accredited Investor” means an institution that is an “accredited investor” as
that term is defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.



     “Interest Coverage Ratio” means, on any Transaction Date, the ratio of:




     (i) the aggregate amount of Consolidated EBITDA for the then most recent four fiscal
quarters prior to such Transaction Date for which reports have been filed with the
Commission or provided to the Trustee pursuant to Section 4.17 (“Four Quarter Period”); to




     (ii) the aggregate Consolidated Interest Expense during such Four Quarter Period.



In making the foregoing calculation,





     (A) pro forma effect shall be given to any Indebtedness Incurred or repaid (other than
in connection with an Asset Acquisition or Asset Disposition) during the period (“Reference
Period”) commencing on the first day of the Four Quarter Period and ending on the
Transaction Date (other than Indebtedness Incurred or repaid under a revolving credit or
similar arrangement to the extent of the commitment thereunder (or under any predecessor
revolving credit or similar arrangement) in effect on the last day of such Four Quarter
Period unless any portion of such Indebtedness is projected, in the reasonable judgment of
the senior management of FelCor LP or FelCor (as evidenced by an Officer’s Certificate), to
remain outstanding for a period in excess of 12 months from the date of the Incurrence
thereof), in each case as if such Indebtedness had been Incurred or repaid on the first day
of such Reference Period;




     (B) Consolidated Interest Expense attributable to interest on any Indebtedness (whether
existing or being Incurred) computed on a pro forma basis and bearing a floating interest
rate shall be computed as if the rate in effect on the Transaction Date (taking into account
any Interest Rate Agreement applicable to such Indebtedness if such Interest Rate Agreement
has a remaining term in excess of 12 months or, if shorter, at least equal to the remaining
term of such Indebtedness) had been the applicable rate for the entire period;



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     (C) pro forma effect shall be given to Asset Dispositions and Asset Acquisitions
(including giving pro forma effect to the application of proceeds of any Asset Disposition
and any Indebtedness Incurred or repaid in connection with any such Asset Acquisitions or
Asset Dispositions) that occur during such Reference Period but subsequent to the end of the
related Four Quarter Period as if they had occurred and such proceeds had been applied on
the first day of such Reference Period; and




     (D) pro forma effect shall be given to asset dispositions and asset acquisitions
(including giving pro forma effect to the application of proceeds of any asset disposition
and any Indebtedness Incurred or repaid in connection with any such asset acquisitions or
asset dispositions) that have been made by any Person that has become a Restricted
Subsidiary or has been merged with or into FelCor LP or FelCor or any of their respective
Restricted Subsidiaries during such Reference Period but subsequent to the end of the
related Four Quarter Period and that would have constituted Asset Dispositions or Asset
Acquisitions during such Reference Period but subsequent to the end of the related Four
Quarter Period had such transactions occurred when such Person was a Restricted Subsidiary
as if such asset dispositions or asset acquisitions were Asset Dispositions or Asset
Acquisitions and had occurred on the first day of such Reference Period; provided that to
the extent that clause (C) or (D) of this sentence requires that pro forma effect be given
to an Asset Acquisition or Asset Disposition, such pro forma calculation shall be based upon
the four full fiscal quarters immediately preceding the Transaction Date of the Person, or
division or line of business, or one or more hotel properties, of the Person that is
acquired or disposed of to the extent that such financial information is available.



     “Interest Payment Date” means each semiannual interest payment date on June 1 and December 1,
of each year, commencing June 1, 2007.



     “Interest Rate Agreement” means any interest rate protection agreement, interest rate future
agreement, interest rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement, option or future contract
or other similar agreement or arrangement with respect to interest rates.



     “Investment” in any Person means any direct or indirect advance, loan or other extension of
credit (including without limitation by way of Guarantee or similar arrangement, but excluding
advances to customers in the ordinary course of business that are, in conformity with GAAP,
recorded as accounts receivable on the consolidated balance sheet of FelCor LP, FelCor and their
respective Restricted Subsidiaries) or capital contribution to (by means of any transfer of cash or
other property (tangible or intangible) to others or any payment for property or services solely
for the account or use of others, or otherwise), or any purchase or acquisition of Capital Stock,
bonds, notes, debentures or other similar instruments issued by, such Person and shall include:




     (i) the designation of a Restricted Subsidiary as an Unrestricted Subsidiary; and




     (ii) the fair market value of the Capital Stock (or any other Investment), held by
FelCor LP or FelCor or any of their respective Restricted Subsidiaries of (or in) any Person
that has ceased to be a Restricted Subsidiary, including without limitation, by reason of
any transaction permitted by clause (iii) of Section 4.06;


provided that the fair market value of the Investment remaining in any Person that has ceased to be
a Restricted Subsidiary shall be deemed not to exceed the aggregate amount of Investments
previously made in such Person valued at the time such Investments were made, less the net
reduction of such Investments. For purposes of the definition of “Unrestricted Subsidiary” and
Section 4.04:





     (i) “Investment” shall include the fair market value of the assets (net of liabilities
(other than liabilities to FelCor LP or FelCor or any of their respective Restricted
Subsidiaries)) of any Restricted Subsidiary at the time such Restricted Subsidiary is
designated an Unrestricted Subsidiary;




     (ii) the fair market value of the assets (net of liabilities (other than liabilities to
FelCor LP or FelCor or any of their respective Restricted Subsidiaries)) of any Unrestricted
Subsidiary at the time that



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such Unrestricted Subsidiary is designated a Restricted Subsidiary shall be considered a
reduction in outstanding Investments; and




     (iii) any property transferred to or from an Unrestricted Subsidiary shall be valued at
its fair market value at the time of such transfer.



     “Investment Grade” means a rating of the Notes by both S&P and Moody’s, each such rating being
in one of such agency’s four highest generic rating categories that signifies investment grade
(i.e., BBB- (or the equivalent) or higher by S&P and Baa3 (or the equivalent) or higher by
Moody’s); provided, in each case, such ratings are publicly available; provided, further, that in
the event Moody’s or S&P is no longer in existence for purposes of determining whether the Notes
are rated “Investment Grade,” such organization may be replaced by a nationally recognized
statistical rating organization (as defined in Rule 436 under the Securities Act) designated by
FelCor LP and FelCor, notice of which shall be given to a Responsible Officer of the Trustee.



     “Lien” means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind
(including without limitation, any conditional sale or other title retention agreement or lease in
the nature thereof or any agreement to give any security interest).



     “Line of Credit” means one or more credit facilities established by FelCor LP or FelCor,
together with all other agreements, instruments and documents executed or delivered pursuant
thereto or in connection therewith, in each case as such agreements, instruments or documents may
be amended, supplemented, extended, renewed, replaced or otherwise modified from time to time.



     “Moody’s” means Moody’s Investors Service, Inc. and its successors.



     “Net Cash Proceeds” means:




     (a) with respect to any Asset Sale, the proceeds of such Asset Sale in the form of cash
or cash equivalents, including payments in respect of deferred payment obligations (to the
extent corresponding to the principal, but not interest, component thereof) when received in
the form of cash or cash equivalents (except to the extent such obligations are financed or
sold with recourse to FelCor LP or FelCor or any of their respective Restricted
Subsidiaries) and proceeds from the conversion of other property received when converted to
cash or cash equivalents, net of:




     (i) brokerage commissions and other fees and expenses (including fees and
expenses of counsel and investment bankers) related to such Asset Sale,




     (ii) provisions for all taxes actually paid or payable as a result of such
Asset Sale by FelCor LP, FelCor and their respective Restricted Subsidiaries, taken
as a whole,




     (iii) payments made to repay Indebtedness or any other obligation outstanding
at the time of such Asset Sale that either (A) is secured by a Lien on the property
or assets sold or (B) is required to be paid as a result of such sale, and




     (iv) amounts reserved by FelCor LP, FelCor and their respective Restricted
Subsidiaries against any liabilities associated with such Asset Sale, including
without limitation, pension and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Sale, all as determined on a
consolidated basis in conformity with GAAP; and




     (b) with respect to any issuance or sale of Capital Stock, the proceeds of such
issuance or sale in the form of cash or cash equivalents, including payments in respect of
deferred payment obligations (to the extent corresponding to the principal, but not
interest, component thereof) when received in the form of cash or cash equivalents (except
to the extent such obligations are financed or sold with recourse to FelCor LP or FelCor or
any of their respective Restricted Subsidiaries) and proceeds from the conversion of



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other property received when converted to cash or cash equivalents, net of attorney’s
fees, accountants’ fees, underwriters’ or placement agents’ fees, discounts or commissions
and brokerage, consultant and other fees incurred in connection with such issuance or sale
and net of tax paid or payable as a result thereof.



     “Non-U.S. Person” means a person who is not a U.S. person, as defined in Regulation S.



     “Note Guarantee” means a Guarantee by FelCor and the Subsidiary Guarantors for payment of the
Notes by such Person, including, without limitation, the Subsidiary Guarantees. The Note
Guarantees will be unsecured senior obligations of each such Person and will be unconditional
regardless of the enforceability of the Notes or this Indenture.



     “Note Register” has the meaning provided in Section 2.04.



     “Notes” means any of the securities, as defined in the first paragraph of the recitals hereof,
that are authenticated and delivered under this Indenture. For all purposes of this Indenture, the
term “Notes” shall include the Notes initially issued on the Closing Date, any other Notes issued
after the Closing Date under this Indenture and any Exchange Notes. For purposes of this
Indenture, all Notes shall vote together as one series of Notes under this Indenture.



     “Offer to Purchase” means an offer to purchase Notes by FelCor LP, from the Holders commenced
by mailing a notice to the Trustee and each Holder stating:




     (i) the covenant pursuant to which the offer is being made and that all Notes validly
tendered will be accepted for payment on a pro rata basis;




     (ii) the purchase price and the date of purchase (which shall be a Business Day no
earlier than 15 days nor later than 60 days from the date such notice is mailed) (“Payment
Date”);




     (iii) that any Note not tendered will continue to accrue interest pursuant to its
terms;




     (iv) that, unless FelCor LP defaults in the payment of the purchase price, any Note
accepted for payment pursuant to the Offer to Purchase shall cease to accrue interest on and
after the Payment Date;




     (v) that Holders electing to have a Note purchased pursuant to the Offer to Purchase
will be required to surrender the Note, together with the form entitled “Option of the
Holder to Elect Purchase” on the reverse side of the Note completed, to the Paying Agent at
the address specified in the notice prior to the close of business on the Business Day
immediately preceding the Payment Date;




     (vi) that Holders will be entitled to withdraw their election if the Payment Agent
receives, not later than the close of business on the third Business Day immediately
preceding the Payment Date, a facsimile transmission or letter setting forth the name of
such Holder, the principal amount of Notes delivered for purchase and a statement that such
Holder is withdrawing his election to have such Notes purchased; and




     (vii) that Holders whose Notes are being purchased only in part will be issued new
Notes equal in principal amount to the unpurchased portion of the Notes surrendered;
provided that each Note purchased and each new Note issued shall be in a principal amount of
$1,000 or integral multiples thereof.



On the Payment Date, FelCor LP shall





     (a) accept for payment on a pro rata basis Notes or portions thereof tendered pursuant
to an Offer to Purchase;



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     (b) deposit with the Paying Agent money sufficient to pay the purchase price of all
Notes or portions thereof so accepted; and




     (c) shall promptly thereafter deliver, or cause to be delivered, to the Trustee all
Notes or portions thereof so accepted together with an Officers’ Certificate specifying the
Notes or portions thereof accepted for payment by FelCor LP.



     The Paying Agent shall promptly mail to the Holders of Notes so accepted payment in an amount
equal to the purchase price, and the Trustee shall promptly authenticate and mail to such Holders a
new Note equal in principal amount to any unpurchased portion of any Note surrendered; provided
that each Note purchased and each new Note issued shall be in a principal amount of $1,000 or
integral multiples thereof. FelCor LP shall publicly announce the results of an Offer to Purchase
as soon as practicable after the Payment Date. FelCor LP shall comply with Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the extent such laws and
regulations are applicable, in the event that FelCor LP is required to repurchase Notes pursuant to
an Offer to Purchase.



     “Officer” means, with respect to any Person, (i) the Chairman of the Board, the President, any
Vice President, the Chief Financial Officer, and (ii) the Treasurer or any Assistant Treasurer, or
the Secretary or any Assistant Secretary or Person holding a similar position at the general
partner or manager of such Person.



     “Officers’ Certificate” means a certificate signed by one Officer listed in clause (i) of the
definition thereof and one Officer listed in clause (ii) of the definition thereof. Each Officers’
Certificate (other than certificates provided pursuant to TIA Section 314(a)(4)) shall include the
statements provided for in TIA Section 314(e).



     “Offshore Global Note” has the meaning provided in Section 2.01.



     “Offshore Notes Exchange Date” has the meaning provided in Section 2.01.



     “Offshore Physical Notes” has the meaning provided in Section 2.01.



     “Opinion of Counsel” means a written opinion signed by legal counsel who may be an employee of
or counsel to FelCor or FelCor LP. Each such Opinion of Counsel shall include the statements
provided for in TIA Section 314(e).



     “Paying Agent” has the meaning provided in Section 2.04, except that, for the purposes of
Article Eight, the Paying Agent shall not be FelCor LP, a Subsidiary of FelCor LP, any Guarantor or
an Affiliate of any of them. The term “Paying Agent” includes any additional Paying Agent.



     “Permanent Offshore Global Note” has the meaning provided in Section 2.01.



     “Permitted Investment” means:




     (i) an Investment in FelCor LP or FelCor or any of their Restricted Subsidiaries or a
Person which will, upon the making of such Investment, become a Restricted Subsidiary or be
merged or consolidated with or into or transfer or convey all or substantially all its
assets to, FelCor LP or FelCor or any of their Restricted Subsidiaries; provided that such
person’s primary business is related, ancillary, incidental or complementary to the
businesses of FelCor LP or FelCor or any of their respective Restricted Subsidiaries on the
date of such Investment;




     (ii) Temporary Cash Investments;




     (iii) payroll, travel and similar advances to cover matters that are expected at the
time of such advances ultimately to be treated as expenses in accordance with GAAP; and




     (iv) stock, obligations or securities received in satisfaction of judgments.



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     “Person” means an individual, partnership, corporation, limited liability company,
unincorporated organization, trust or joint venture, or a governmental agency or political
subdivision thereof.



     “Physical Notes” has the meaning provided in Section 2.01.



     “Pledge Agreement” means a pledge agreement between the Collateral Agent and the Pledgor
substantially in the form attached as Exhibit F to this Indenture.



     “Pledged Collateral” means the units of limited partner interest of FelCor LP held by the
Pledgor, representing a greater than 94% common limited partnership interest in FelCor LP.



     “Pledgor” means FelCor Holdings Trust, a Massachusetts business trust.



     “Preferred Stock” means, with respect to any Person, any and all shares, interests,
participation or other equivalents (however designated, whether voting or non-voting) that have a
preference on liquidation or with respect to distributions over any other class of Capital Stock,
including preferred partnership interests, whether general or limited, or such Person’s preferred
or preference stock, whether outstanding on the Closing Date or issued thereafter, including,
without limitation, all series and classes of such preferred or preference stock.



     “Private Placement Legend” means the legend initially set forth on the Notes in the form set
forth in Section 2.02.



     “QIB” means a “qualified institutional buyer” as defined in Rule 144A.



     “Redemption Date,” when used with respect to any Note to be redeemed, means the date fixed for
such redemption by or pursuant to this Indenture.



     “Redemption Price,” when used with respect to any Note to be redeemed, means the price at
which such Note is to be redeemed pursuant to this Indenture.



     “Registrar” has the meaning provided in Section 2.04.



     “Registration Rights Agreement” means the Registration Rights Agreement, dated October 31,
2006, among FelCor LP, FelCor, Merrill Lynch & Co. and Merrill Lynch, Pierce, Fenner & Smith
Incorporated and certain permitted assigns specified therein.



     “Registration Statement” means the Registration Statement as defined and described in the
Registration Rights Agreement.



     “Regular Record Date” for the interest payable on any Interest Payment Date means the May 15
or November 15 (whether or not a Business Day), as the case may be, next preceding such Interest
Payment Date.



     “Regulation S” means Regulation S under the Securities Act.



     “Responsible Officer,” when used with respect to the Trustee, means the chairman or any vice
chairman of the board of directors, the chairman or any vice chairman of the executive committee of
the board of directors, the chairman of the trust committee, the president, any vice president, any
assistant vice president, the secretary, any assistant secretary, the treasurer, any assistant
treasurer, the cashier, any assistant cashier, any trust officer or assistant trust officer, the
controller or any assistant controller or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such matter is referred
because of his or her knowledge of and familiarity with the particular subject.



     “Restricted Subsidiary” means any Subsidiary of FelCor LP or FelCor other than an Unrestricted
Subsidiary; provided that FelCor LP shall not be a Restricted Subsidiary of FelCor.



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     “Rule 144A” means Rule 144A under the Securities Act.



     “Secured Indebtedness” means any Indebtedness secured by a Lien upon the property of FelCor LP
or FelCor or any of their respective Restricted Subsidiaries, other than Indebtedness secured by a
Stock Pledge to the extent such Indebtedness does not exceed 50% of Adjusted Total Assets.



     “Securities Act” means the Securities Act of 1933, as amended.



     “Senior Indebtedness” means the following obligations of FelCor LP or FelCor or any of their
respective Restricted Subsidiaries, whether outstanding on the Closing Date or thereafter Incurred:




     (i) all Indebtedness and all other monetary obligations (including expenses, fees and
other monetary obligations) of FelCor LP and FelCor under the Line of Credit;




     (ii) all Indebtedness and all other monetary obligations of FelCor LP or FelCor or any
of their respective Restricted Subsidiaries (other than the Notes), including principal and
interest on such Indebtedness, unless such Indebtedness, by its terms or by the terms of any
agreement or instrument pursuant to which such Indebtedness is issued is expressly
subordinated in right of payment to the Notes; and




     (iii) Subsidiary Debt.



     Senior Indebtedness will also include interest accruing subsequent to events of bankruptcy of
FelCor LP and FelCor and their respective Restricted Subsidiaries at the rate provided for the
document governing such Senior Indebtedness, whether or not such interest is an allowed claim
enforceable against the debtor in a bankruptcy case under bankruptcy law.



     “Shelf Registration Statement” means the Shelf Registration Statement as defined in the
Registration Rights Agreement.



     “Significant Subsidiary” means, at any date of determination, any Restricted Subsidiary that,
together with its Subsidiaries:




     (i) for the most recent fiscal year of FelCor LP and FelCor, accounted for more than
10% of the consolidated revenues of FelCor LP, FelCor and their respective Restricted
Subsidiaries, or




     (ii) as of the end of such fiscal year, was the owner of more than 10% of the
consolidated assets of FelCor LP, FelCor and their respective Restricted Subsidiaries, all
as set forth on the most recently available consolidated financial statements thereof for
such fiscal year.



     “S&P” means Standard & Poor’s and its successors.



     “Specified Date” means any Redemption Date, Change of Control Payment Date, Excess Proceeds
Payment Date or any date on which the Notes first become due and payable after an Event of Default.



     “Stated Maturity” means:




     (i) with respect to any debt security, the date specified in such debt security as the
fixed date on which the final installment of principal of such debt security is due and
payable; and




     (ii) with respect to any scheduled installment of principal of or interest on any debt
security, the date specified in such debt security as the fixed date on which such
installment is due and payable.



     “Stock Pledge” means a security interest in the equity interests of subsidiaries of FelCor
and/or FelCor LP.



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     “Subsidiary” means, with respect to any Person, any corporation, association or other business
entity of which more than 50% of the voting power of the outstanding Voting Stock is owned,
directly or indirectly, by such Person and one or more other Subsidiaries of such Person and the
accounts of which would be consolidated with those of such Person in its consolidated financial
statements in accordance with GAAP, if such statements were prepared as of such date.



     “Subsidiary Debt” means all unsecured Indebtedness of which a Restricted Subsidiary is the
primary obligor.



     “Subsidiary Guarantee” means a Guarantee by each Subsidiary Guarantor for payment of the Notes
by such Subsidiary Guarantor. The Subsidiary Guarantee will be an unsecured senior obligation of
each Subsidiary Guarantor and will be unconditional regardless of the enforceability of the Notes
and this Indenture. Notwithstanding the foregoing, each Subsidiary Guarantee by a Subsidiary
Guarantor shall provide by its terms that it shall be automatically and unconditionally released
and discharged upon (i) the sale or other disposition of the Capital Stock of such Subsidiary
Guarantor, if, as a result of such sale or disposition, such Subsidiary Guarantor ceases to be a
subsidiary of FelCor LP; provided such sale or other disposition is in compliance with the terms of
this Indenture, (ii) the consolidation or merger of any such Subsidiary Guarantor with any person
other than FelCor LP or a Subsidiary of FelCor LP, if, as a result of such consolidation or merger,
such Subsidiary Guarantor ceases to be a subsidiary of FelCor LP; provided such consolidation or
merger is in compliance with this Indenture, (iii) a defeasance under Section 8.02 or 8.03 of this
Indenture or (iv) the unconditional and complete release of such Subsidiary Guarantor from its
Guarantee of all Guaranteed Indebtedness.



     “Subsidiary Guarantor” means each of:




     (i) FelCor/CSS Holdings, L.P., a Delaware limited partnership;




     (ii) FelCor Hotel Asset Company, L.L.C., a Delaware limited liability company;




     (iii) FelCor Pennsylvania Company, L.L.C., a Delaware limited liability company;




     (iv) FelCor Lodging Holding Company, L.L.C., a Delaware limited liability company;




     (v) FHAC Texas Holdings, L.P., a Texas limited partnership;




     (vi) FelCor Canada Co., a Nova Scotia unlimited liability company;




     (vii) FelCor Omaha Hotel Company, L.L.C., a Delaware limited liability company;




     (viii) FelCor TRS Holdings, L.P., a Delaware limited partnership;




     (ix) Myrtle Beach Hotels, L.L.C., a Delaware limited liability company;




     (x) FelCor TRS Borrower 1, L.P., a Delaware limited partnership;




     (xi) FelCor TRS Guarantor, L.P., a Delaware limited partnership;




     (xii) Center City Hotel Associates, a Pennsylvania limited partnership;




     (xiii) FelCor Lodging Company, L.L.C., a Delaware limited liability company;




     (xiv) FelCor TRS Borrower 3, L.P., a Delaware limited partnership;




     (xv) FelCor TRS Borrower 4, L.L.C, a Delaware limited liability company; and



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     (xvi) each other Restricted Subsidiary that executes a Subsidiary Guarantee in
compliance with Section 4.07.



     “Temporary Cash Investment” means any of the following:




     (i) direct obligations of the United States of America or any agency thereof or
obligations fully and unconditionally guaranteed by the United States of America or any
agency thereof;




     (ii) time deposits accounts, certificates of deposit and money market deposits maturing
within 180 days of the date of acquisition thereof issued by a bank or trust company which
is organized under the laws of the United States of America, any state thereof, and which
bank or trust company has capital, surplus and undivided profits aggregating in excess of
$50 million and has outstanding debt which is rated “A” (or such similar equivalent rating)
or higher by at least one nationally recognized statistical rating organization (as defined
in Rule 436 under the Securities Act) or any money-market fund sponsored by a registered
broker dealer or mutual fund distributor;




     (iii) repurchase obligations with a term of not more than 30 days for underlying
securities of the types described in clause (i) above entered into with a bank meeting the
qualifications described in clause (ii) above;




     (iv) commercial paper, maturing not more than 90 days after the date of acquisition,
issued by a corporation (other than an Affiliate of FelCor LP or FelCor) organized and in
existence under the laws of the United States of America, any state thereof with a rating at
the time as of which any investment therein is made of “P-1” (or higher) according to
Moody’s or “A-1” (or higher) according to S&P; and




     (v) securities with maturities of six months or less from the date of acquisition
issued or fully and unconditionally guaranteed by any state, commonwealth or territory of
the United States of America, or by any political subdivision or taxing authority thereof,
and rated at least “A” by S&P or Moody’s.



     “Temporary Offshore Global Note” has the meaning provided in Section 2.01.



     “TIA” or “Trust Indenture Act” means the Trust Indenture Act of 1939, as amended (15 U.S. Code
Sections 77aaa-77bbb), as in effect on the date this Indenture was executed, except as provided in
Section 9.06.



     “Total Assets” means the sum of:




     (i) Undepreciated Real Estate Assets; and




     (ii) all other assets of FelCor LP, FelCor and their respective Restricted Subsidiaries
on a consolidated basis determined in conformity with GAAP (but excluding intangibles and
accounts receivables).



     “Total Unencumbered Assets” as of any date means the sum of:




     (i) those Undepreciated Real Estate Assets not securing any portion of Secured
Indebtedness; and




     (ii) all other assets (but excluding intangibles and accounts receivable) of FelCor LP,
FelCor and their respective Restricted Subsidiaries not securing any portion of Secured
Indebtedness determined on a consolidated basis in accordance with GAAP.



     “Trade Payables” means, with respect to any Person, any accounts payable or any other
indebtedness or monetary obligation to trade creditors created, assumed or Guaranteed by such
Person or any of its Subsidiaries arising in the ordinary course of business in connection with the
acquisition of goods or services.



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     “Transaction Date” means, with the respect to the Incurrence of any Indebtedness by FelCor LP
or FelCor or any of their respective Restricted Subsidiaries, the date such Indebtedness is to be
Incurred and, with respect to any Restricted Payment, the date such Restricted Payment is to be
made.



     “Trustee” means the party named as such in the first paragraph of this Indenture until a
successor replaces it in accordance with the provisions of Article Seven of this Indenture and
thereafter means such successor.



     “Undepreciated Real Estate Assets” means, as of any date, the cost (being the original cost to
FelCor LP or FelCor or any of their respective Restricted Subsidiaries plus capital improvements)
of real estate assets of FelCor LP, FelCor and their Restricted Subsidiaries on such date, before
depreciation and amortization of such real estate assets, determined on a consolidated basis in
conformity with GAAP.



     “United States Bankruptcy Code” means the Bankruptcy Reform Act of 1978, as amended and as
codified in Title 11 of the United States Code, as amended from time to time hereafter, or any
successor federal bankruptcy law.



     “Units” means the limited partnership units of FelCor LP, that by their terms are redeemable
at the option of the holder thereof and that, if so redeemed, at the election of FelCor are
redeemable for cash or Common Stock of FelCor.



“Unrestricted Subsidiary” means





     (i) any Subsidiary of FelCor LP or FelCor that at the time of determination shall be
designated an Unrestricted Subsidiary by the Board of Directors in the manner provided
below; and




     (ii) any Subsidiary of an Unrestricted Subsidiary.



     The Board of Directors may designate any Restricted Subsidiary (including any newly acquired
or newly formed Subsidiary of FelCor LP or FelCor) to be an Unrestricted Subsidiary unless such
Subsidiary owns any Capital Stock of, or owns or holds any Lien on any property of, FelCor LP or
FelCor or any of their respective Restricted Subsidiaries (other than Capital Stock of any
Subsidiaries of such Subsidiary); provided that:




     (A) any Guarantee by FelCor LP or FelCor or any of their respective Restricted
Subsidiaries of any Indebtedness of the Subsidiary being so designated shall be deemed an
“Incurrence” of such Indebtedness and an “Investment” by FelCor LP or FelCor or such
Restricted Subsidiary (or all, if applicable) at the time of such designation;




     (B) either (I) the Subsidiary to be so designated has total assets of $1,000 or less or
(II) if such Subsidiary has assets greater than $1,000, such designation would be permitted
under Section 4.04; and




     (C) if applicable, the Incurrence of Indebtedness and the Investment referred to in
clause (A) of this proviso would be permitted under Sections 4.03 and 4.04.



     The Board of Directors may designate any Unrestricted Subsidiary to be a Restricted Subsidiary;
provided that




     (i) no Default or Event of Default shall have occurred and be continuing at the time of
or after giving effect to such designation; and




     (ii) all Liens and Indebtedness of such Unrestricted Subsidiary outstanding immediately
after such designation would, if Incurred at such time, have been permitted to be Incurred
(and shall be deemed to have been Incurred) for all purposes of this Indenture.



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     Any such designation by the Board of Directors shall be evidenced to the Trustee by promptly
filing with the Trustee a copy of the Board Resolution giving effect to such designation and an
Officers’ Certificate certifying that such designation complied with the foregoing provisions.



     “Unsecured Indebtedness” means any Indebtedness of FelCor LP or FelCor or any of their
respective Restricted Subsidiaries that is not Secured Indebtedness.



     “U.S. Global Note” has the meaning provided in Section 2.01.



     “U.S. Physical Notes” has the meaning provided in Section 2.01.



     “Voting Stock” means with respect to any Person, Capital Stock of any class or kind ordinarily
having the power to vote for the election of directors, managers or other voting members of the
governing body of such Person.



     “Wholly Owned” means, with respect to any Subsidiary of any Person, the ownership of all of
the outstanding Capital Stock of such Subsidiary (other than any director’s qualifying shares or
Investments by individuals mandated by applicable law) by such Person or one or more Wholly Owned
Subsidiaries of such Person.



     SECTION 1.02. Incorporation by Reference of Trust Indenture Act. Whenever this Indenture
refers to a provision of the TIA, the provision is incorporated by reference in and made a part of
this Indenture. The following TIA terms used in this Indenture have the following meanings:



     “indenture notes” means the Notes;



     “indenture note holder” means a Holder or a Noteholder;



     “indenture to be qualified” means this Indenture;



     “indenture trustee” or “institutional trustee” means the Trustee; and



     “obligor” on the indenture securities means FelCor LP, the Guarantors or any other obligor on
the Notes.



     All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA
reference to another statute or defined by a rule of the Commission and not otherwise defined
herein have the meanings assigned to them therein.



     SECTION 1.03. Rules of Construction. Unless the context otherwise requires:




     (i) a term has the meaning assigned to it;




     (ii) an accounting term not otherwise defined has the meaning assigned to it in
accordance with GAAP;




     (iii) “or” is not exclusive;




     (iv) words in the singular include the plural, and words in the plural include the
singular;




     (v) provisions apply to successive events and transactions;




     (vi) “herein,” “hereof” and other words of similar import refer to this Indenture as a
whole and not to any particular Article, Section or other subdivision;




     (vii) all ratios and computations based on GAAP contained in this Indenture shall be
computed in accordance with the definition of GAAP set forth in Section 1.01; and



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     (viii) all references to Sections or Articles refer to Sections or Articles of this
Indenture unless otherwise indicated.



ARTICLE II




NOTES




     SECTION 2.01. Form and Dating. The Notes and the Trustee’s certificate of authentication
shall be substantially in the form annexed hereto as Exhibit A with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by this Indenture. The
Notes may have notations, legends or endorsements required by law, stock exchange agreements to
which FelCor LP or the Guarantors are subject or usage. FelCor LP shall approve the form of the
Notes and any notation, legend or endorsement on the Notes. Each Note shall be dated the date of
its authentication.



     The terms and provisions contained in the form of the Notes annexed hereto as Exhibit A shall
constitute, and are hereby expressly made, a part of this Indenture. To the extent applicable,
FelCor LP, the Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby.



     Notes offered and sold in reliance on Rule 144A shall be issued initially in the form of one
or more permanent global Notes in registered form, substantially in the form set forth in Exhibit A
(collectively, the “U.S. Global Notes”), deposited with the Trustee, as custodian for the
Depositary, duly executed by FelCor LP and authenticated by the Trustee as hereinafter provided.
The aggregate principal amount of the U.S. Global Notes may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for the Depositary or its
nominee, as hereinafter provided.



     Notes offered and sold in offshore transactions in reliance on Regulation S shall be issued
initially in the form of one or more temporary global Notes in registered form substantially in the
form set forth in Exhibit A (the “Temporary Offshore Global Notes”) deposited with the Trustee, as
custodian for the Depositary, duly executed by FelCor LP and authenticated by the Trustee as
hereinafter provided. At any time following 40 days from the initial issuance of a series of notes
(the “Offshore Notes Exchange Date”), upon receipt by the Trustee and FelCor LP of a certificate
substantially in the form of Exhibit B hereto, one or more permanent global Notes in registered
form substantially in the form set forth in Exhibit A (the “Permanent Offshore Global Notes,” and
together with the Temporary Offshore Global Notes, the “Offshore Global Notes”) duly executed by
FelCor LP and authenticated by the Trustee as hereinafter provided shall be deposited with the
Trustee, as custodian for the Depositary, and the Registrar shall reflect on its books and records
the date and a decrease in the principal amount of the Temporary Offshore Global Notes in an amount
equal to the principal amount of the beneficial interest in the Temporary Offshore Global Notes
transferred.



     Notes offered and sold in reliance on Regulation D under the Securities Act shall be issued in
the form of permanent certificated Notes in registered form in substantially the form set forth in
Exhibit A (the “U.S. Physical Notes”). Notes issued pursuant to Section 2.07 in exchange for
interests in the Offshore Global Note shall be in the form of permanent certificated Notes in
registered form substantially in the form set forth in Exhibit A (the “Offshore Physical Notes”).



     The Offshore Physical Notes and U.S. Physical Notes are sometimes collectively herein referred
to as the “Physical Notes,” The U.S. Global Notes and the Offshore Global Notes are sometimes
referred to herein as the “Global Notes.”



     The definitive Notes shall be typed, printed, lithographed or engraved or produced by any
combination of these methods or may be produced in any other manner permitted by the rules of any
securities exchange on which the Notes may be listed, all as determined by the Officers executing
such Notes, as evidenced by their execution of such Notes.



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     SECTION 2.02. Restrictive Legends. Unless and until a Note is exchanged for an Exchange Note
or sold in connection with an effective Registration Statement pursuant to the Registration Rights
Agreement, the U.S. Global Notes, Temporary Offshore Global Notes and each U.S. Physical Note shall
bear the following legend on the face thereof:




THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A “QUALIFIED
INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A
U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
RULE 904 UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT, WITHIN TWO YEARS AFTER THE
ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO
FELCOR LODGING LIMITED PARTNERSHIP OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES
TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT,
(C) INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR (AS DEFINED IN RULE 501(a)(1), (2),
(3), OR (7) UNDER THE SECURITIES ACT (AN “ACCREDITED INVESTOR”) THAT, PRIOR TO SUCH
TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE
A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE
TRUSTEE FOR THIS SECURITY), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 903 OR RULE 904 UNDER THE SECURITIES ACT (IF AVAILABLE), (E) PURSUANT
TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE), (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF FELCOR LP SO REQUESTS), OR (G)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT
IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS SECURITY WITHIN TWO
YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY, IF THE PROPOSED TRANSFEREE IS AN
ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND
FELCOR LP SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY
REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT. AS USED HEREIN, THE TERMS “OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S. PERSON”
HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.



     Each Global Note, whether or not an Exchange Note, shall also bear the following legend on the
face thereof:




UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, TO FELCOR LP OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY



-21-









 







TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS
OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTION 2.08 OF THE INDENTURE.



     SECTION 2.03. Execution, Authentication and Denominations. The Notes shall be executed by two
Officers of FelCor, as general partner of FelCor LP. The signature of any of these Officers on the
Notes may be by facsimile or manual signature in the name and on behalf of FelCor or FelCor LP, as
the case may be.



     If an Officer whose signature is on a Note no longer holds that office at the time the Trustee
or authenticating agent authenticates the Note, the Note shall be valid nevertheless.



     A Note shall not be valid until the Trustee or authenticating agent manually signs the
certificate of authentication on the Note. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.



     The Notes shall be issued in the initial aggregate principal amount of $215,000,000, provided
that FelCor LP may issue additional Notes hereunder without limitation as to principal amount in
accordance with Section 2.15 hereof.



     At any time and from time to time after the execution of this Indenture, the Trustee or an
authenticating agent shall upon receipt of a Company Order authenticate for original issue Notes in
the aggregate principal amount specified in such Company Order; provided that the Trustee shall be
entitled to receive an Officers’ Certificate and an Opinion of Counsel of FelCor LP in connection
with such authentication of Notes. Such Company Order shall specify the amount of Notes to be
authenticated , the principal amount of each Note to be authenticated, the date on which the
original issue of Notes is to be authenticated, the registered holder of each of the said Notes,
delivery instruction for each such Note and in case of an issuance of Notes pursuant to Section
2.15, shall certify that such issuance is in compliance with Article Four.



     The Trustee may appoint an authenticating agent to authenticate Notes. An authenticating
agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such authenticating agent. An
authenticating agent has the same rights as an Agent to deal with FelCor LP or an Affiliate of
FelCor LP.



     The Notes shall be issuable only in registered form without coupons and only in denominations
of $1,000 in principal amount at maturity and any integral multiple of $1,000 in excess thereof.



     SECTION 2.04. Registrar and Paying Agent. FelCor LP shall maintain an office or agency where
Notes may be presented for registration of transfer or for exchange (the “Registrar”), an office or
agency where Notes may be presented for payment (the “Paying Agent”) and an office or agency where
notices and demands to or upon FelCor LP in respect of the Notes and this Indenture may be served,
which shall be in the Borough of Manhattan, The City of New York. FelCor LP shall cause the
Registrar to keep a register of the Notes and of their transfer and exchange (the “Note Register”).
FelCor LP may have one or more co-Registrars and one or more additional Paying Agents.



     FelCor LP shall enter into an appropriate agency agreement with any Agent not a party to this
Indenture. The agreement shall implement the provisions of this Indenture that relate to such
Agent. FelCor LP shall give prompt written notice to the Trustee of the name and address of any
such Agent and any change in the address of such Agent. If FelCor LP fails to maintain a
Registrar, Paying Agent and/or agent for service of notices and demands, the Trustee shall act as
such Registrar, Paying Agent and/or agent for service of notices and demands. FelCor LP may remove
any Agent upon written notice to such Agent and the Trustee; provided that no such removal shall
become effective until (i) the acceptance of an appointment by a successor Agent to such Agent as
evidenced



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by an appropriate agency agreement entered into by FelCor LP and such successor Agent and
delivered to the Trustee or (ii) notification to the Trustee that the Trustee shall serve as such
Agent until the appointment of a successor Agent in accordance with clause (i) of this proviso.
Except with respect to Article 8, FelCor, FelCor LP, any Subsidiary of FelCor or FelCor LP, or any
Affiliate of any of them may act as Paying Agent, Registrar or co-Registrar, and/or agent for
service of notice and demands.



     FelCor LP initially appoints the Trustee as Registrar, Paying Agent, authenticating agent and
agent for service of notice and demands. If, at any time, the Trustee is not the Registrar, the
Registrar shall make available to the Trustee on or before each Interest Payment Date and at such
other times as the Trustee may reasonably request, the names and addresses of the Holders as they
appear in the Note Register.



     SECTION 2.05. Paying Agent To Hold Money in Trust. Not later than each due date of the
principal, premium, if any, and interest on any Notes, FelCor LP shall deposit with the Paying
Agent money in immediately available funds sufficient to pay such principal, premium, if any, and
interest so becoming due; provided that if the Trustee is then serving as Paying Agent, FelCor LP
agrees to use its reasonable best efforts to deposit or otherwise transfer such funds to the
Trustee by no later than 11:00 a.m., New York City time, on the applicable due date. FelCor LP
shall require each Paying Agent other than the Trustee to agree in writing that such Paying Agent
shall hold in trust for the benefit of the Holders or the Trustee all money held by the Paying
Agent for the payment of principal of, premium, if any, and interest on the Notes (whether such
money has been paid to it by FelCor LP or any other obligor on the Notes), and such Paying Agent
shall promptly notify the Trustee of any default by FelCor LP (or any other obligor on the Notes)
in making any such payment. FelCor LP at any time may require a Paying Agent to pay all money held
by it to the Trustee and account for any funds disbursed, and the Trustee may at any time during
the continuance of any payment default, upon written request to a Paying Agent, require such Paying
Agent to pay all money held by it to the Trustee and to account for any funds disbursed. Upon
doing so, the Paying Agent shall have no further liability for the money so paid over to the
Trustee. If FelCor, FelCor LP or any Subsidiary of FelCor or FelCor LP or any Affiliate of any of
them acts as Paying Agent, it will, on or before each due date of any principal of, premium, if
any, or interest on the Notes, segregate and hold in a separate trust fund for the benefit of the
Holders a sum of money sufficient to pay such principal, premium, if any, or interest so becoming
due until such sum of money shall be paid to such Holders or otherwise disposed of as provided in
this Indenture, and will promptly notify the Trustee of its action or failure to act.



     SECTION 2.06. Transfer and Exchange. The Notes are issuable only in registered form. A
Holder may transfer a Note only by written application to the Registrar stating the name of the
proposed transferee and otherwise complying with the terms of this Indenture. No such transfer
shall be effected until, and such transferee shall succeed to the rights of a Holder only upon,
final acceptance and registration of the transfer by the Registrar in the Note Register. Prior to
the registration of any transfer by a Holder as provided herein, FelCor LP, the Guarantors, the
Trustee, and any agent of FelCor LP shall treat the person in whose name the Note is registered as
the owner thereof for all purposes whether or not the Note shall be overdue, and neither FelCor LP,
the Guarantors, the Trustee, nor any such agent shall be affected by notice to the contrary.
Furthermore, any Holder of a Global Note shall, by acceptance of such Global Note, agree that
transfers of beneficial interests in such Global Note may be effected only through a book entry
system maintained by the Holder of such Global Note (or its agent) and that ownership of a
beneficial interest in the Note shall be required to be reflected in a book entry. When Notes are
presented to the Registrar or a co-Registrar with a request to register the transfer or to exchange
them for an equal principal amount of Notes of other authorized denominations (including an
exchange of Notes for Exchange Notes), the Registrar shall register the transfer or make the
exchange as requested if its requirements for such transactions are met; provided that no exchanges
of Notes for Exchange Notes shall occur until a Registration Statement shall have been declared
effective by the Commission and that any Notes that are exchanged for Exchange Notes shall be
cancelled by the Trustee. To permit registrations of transfers and exchanges, FelCor LP shall
execute and the Trustee shall authenticate Notes at the Registrar’s request. No service charge
shall be made for any registration of transfer or exchange or redemption of the Notes, but FelCor
LP may require payment of a sum sufficient to cover any transfer tax or similar governmental charge
payable in connection therewith (other than any such transfer taxes or other similar governmental
charge payable upon exchanges pursuant to Section 2.11, 3.08 or 9.04).



     The Registrar shall not be required (i) to issue, register the transfer of or exchange any
Note during a period beginning at the opening of business 15 days before the day of the mailing of
a notice of redemption of Notes selected



-23-









 







for redemption under Section 3.03 and ending at the close of business on the day of
such mailing, or (ii) to register the transfer of or exchange any Note so selected for redemption
in whole or in part, except the unredeemed portion of any Note being redeemed in part.



     SECTION 2.07. Book-Entry Provisions for Global Notes. (a) The U.S. Global Note and Offshore
Global Note initially shall (i) be registered in the name of the Depositary for such Global Notes
or the nominee of such Depositary, (ii) be delivered to the Trustee as custodian for such
Depositary and (iii) bear legends as set forth in Section 2.02.



     Members of, or participants in, the Depositary (“Agent Members”) shall have no rights under
this Indenture with respect to any Global Note held on their behalf by the Depositary, or the
Trustee as its custodian, or under the Global Note, and the Depositary may be treated by FelCor LP,
the Guarantors, the Trustee and any agent of FelCor LP, the Guarantors, or the Trustee as the
absolute owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent FelCor LP, the Guarantors, the Trustee or any agent of FelCor LP, the
Guarantors, or the Trustee, from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary and its Agent
Members, the operation of customary practices governing the exercise of the rights of a Holder of
any Note.



     (b) Transfers of a Global Note shall be limited to transfers of such Global Note in whole, but
not in part, to the Depositary, its successors or their respective nominees. Interests of
beneficial owners in a Global Note may be transferred in accordance with the rules and procedures
of the Depositary and the provisions of Section 2.08. In addition, U.S. Physical Notes and
Offshore Physical Notes shall be transferred to all beneficial owners in exchange for their
beneficial interests in the U.S. Global Note or the Offshore Global Note, respectively, if (i) the
Depositary notifies FelCor LP that it is unwilling or unable to continue as Depositary for the U.S.
Global Note or the Offshore Global Note, as the case may be, and a successor depositary is not
appointed by FelCor LP within 90 days of such notice, (ii) an Event of Default has occurred and is
continuing and the Registrar has received a request therefor from the Depositary or (iii) in
accordance with the rules and procedures of the Depositary and the provisions of Section 2.08.



     (c) Any beneficial interest in one of the Global Notes that is transferred to a person who
takes delivery in the form of an interest in the other Global Note will, upon transfer, cease to be
an interest in such Global Note and become an interest in the other Global Note and, accordingly,
will thereafter be subject to all transfer restrictions, if any, and other procedures applicable to
beneficial interests in such other Global Note for as long as it remains such an interest.



     (d) In connection with any transfer of a portion of the beneficial interests in the U.S.
Global Note or Permanent Offshore Global Note to beneficial owners pursuant to paragraph (b) of
this Section, the Registrar shall reflect on its books and records the date and a decrease in the
principal amount of the U.S. Global Note or Permanent Offshore Global Note in an amount equal to
the principal amount of the beneficial interest in the U.S. Global Note or Permanent Offshore
Global Note to be transferred, and FelCor LP shall execute, and the Trustee shall authenticate and
deliver, one or more U.S. Physical Notes or Offshore Physical Notes, as the case may be, of like
tenor and amount.



     (e) In connection with the transfer of the entire U.S. Global Note or Offshore Global Note to
beneficial owners pursuant to paragraph (b) of this Section, the U.S. Global Note or Offshore
Global Note, as the case may be, shall be deemed to be surrendered to the Trustee for cancellation,
and FelCor LP shall execute, and the Trustee shall authenticate and deliver, to each beneficial
owner identified by the Depositary in exchange for its beneficial interest in the U.S. Global Note
or Offshore Global Note, as the case may be, an equal aggregate principal amount of U.S. Physical
Notes or Offshore Physical Notes, as the case may be, of authorized denominations.



     (f) Any U.S. Physical Note delivered in exchange for an interest in the U.S. Global Note
pursuant to paragraph (b), (d) or (e) of this Section shall, except as otherwise provided by
paragraph (f) of Section 2.08, bear the legend regarding transfer restrictions applicable to the
U.S. Physical Note set forth in Section 2.02.



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     (g) Any Offshore Physical Note delivered in exchange for an interest in the Temporary Offshore
Global Note pursuant to paragraph (b), (d) or (e) of this Section shall, except as otherwise
provided by paragraph (f) of Section 2.08, bear the legend regarding transfer restrictions
applicable to the Offshore Physical Note set forth in Section 2.02.




     (h) The registered Holder of a Global Note may grant proxies and otherwise authorize any
person, including Agent Members and persons that may hold interests through Agent Members, to take
any action which a Holder is entitled to take under this Indenture or the Notes.



     SECTION 2.08. Special Transfer Provisions. Unless and until a Note is exchanged for an
Exchange Note or sold in connection with an effective Registration Statement pursuant to the
Registration Rights Agreement, the following provisions shall apply:



     (a) Transfers to Non-QIB Institutional Accredited Investors. The following provisions
shall apply with respect to the registration of any proposed transfer of a Note to any
Institutional Accredited Investor which is not a QIB (excluding Non-U.S. Persons):




     (1) The Registrar shall register the transfer of any Note, whether or not such Note
bears the Private Placement Legend, if (x) the requested transfer is two years after the
original issuance of the Notes or (y) the proposed transferee has delivered to the Registrar
a certificate substantially in the form of Exhibit C hereto and, if such transfer is with
respect to an aggregate principal amount of Notes at the time of transfer of less than
$100,000, an opinion of counsel acceptable to FelCor and FelCor LP that such transfer is in
compliance with the Securities Act.




     (2) If the proposed transferor is an Agent Member holding a beneficial interest in the
U.S. Global Note, upon receipt by the Registrar of (x) the documents, if any, required by
paragraph (1) and (y) instructions given in accordance with the Depositary’s and the
Registrar’s procedures, the Registrar shall reflect on its books and records the date and a
decrease in the principal amount at maturity of the U.S. Global Note in an amount equal to
the principal amount at maturity of the beneficial interest in the U.S. Global Note to be
transferred, and FelCor LP shall execute, and the Trustee shall authenticate and deliver,
one or more U.S. Physical Notes of like tenor and amount.



     (b) Transfers to QIBs. The following provisions shall apply with respect to the
registration of any proposed transfer of a U.S. Physical Note or an interest in the U.S. Global
Note to a QIB (excluding Non-U.S. Persons):




     (i) If the Note to be transferred consists of (x) U.S. Physical Notes, the Registrar
shall register the transfer if such transfer is being made by a proposed transferor who has
checked the box provided for on the form of Note stating, or has otherwise advised FelCor LP
and the Registrar in writing, that the sale has been made in compliance with the provisions
of Rule 144A to a transferee who has signed the certification provided for on the form of
Note stating, or has otherwise advised FelCor LP and the Registrar in writing, that it is
purchasing the Note for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a QIB within the meaning of
Rule 144A, and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding FelCor LP and the Guarantors as
it has requested pursuant to Rule 144A or has determined not to request such information and
that it is aware that the transferor is relying upon its foregoing representations in order
to claim the exemption from registration provided by Rule 144A or (y) an interest in the
U.S. Global Note, the transfer of such interest may be effected only through the book entry
system maintained by the Depositary.




     (ii) If the proposed transferee is an Agent Member, and the Note to be transferred
consists of U.S. Physical Notes, upon receipt by the Registrar of the documents referred to
in clause (i) and instructions given in accordance with the Depositary’s and the Registrar’s
procedures, the Registrar shall reflect on its books and records the date and an increase in
the principal amount at maturity of the U.S. Global



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Note in an amount equal to the principal amount at maturity of the U.S. Physical Notes,
to be transferred, and the Trustee shall cancel the U.S. Physical Note so transferred.



     (c) Transfers of Interests in the Temporary Offshore Global Note. The following
provisions shall apply with respect to registration of any proposed transfer of interests in the
Temporary Offshore Global Note:




     (i) The Registrar shall register the transfer of any Note (x) if the proposed
transferee is a Non-U.S. Person and the proposed transferor has delivered to the Registrar a
certificate substantially in the form of Exhibit D hereto or (y) if the proposed transferee
is a QIB and the proposed transferor has checked the box provided for on the form of Note
stating, or has otherwise advised FelCor LP and the Registrar in writing, that the sale has
been made in compliance with the provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Note stating, or has otherwise advised FelCor LP
and the Registrar in writing, that it is purchasing the Note for its own account or an
account with respect to which it exercises sole investment discretion and that it and any
such account is a QIB within the meaning of Rule 144A, and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that it has received such information
regarding FelCor LP and the Guarantors as it has requested pursuant to Rule 144A or has
determined not to request such information and that it is aware that the transferor is
relying upon its foregoing representations in order to claim the exemption from registration
provided by Rule 144A.




     (ii) If the proposed transferee is an Agent Member, upon receipt by the Registrar of
the documents referred to in clause (i)(y) above and instructions given in accordance with
the Depositary’s and the Registrar’s procedures, the Registrar shall reflect on its books
and records the date and an increase in the principal amount at maturity of the U.S. Global
Note, in an amount equal to the principal amount at maturity of the Temporary Offshore
Global Note to be transferred, and the Trustee shall decrease the amount of the Temporary
Offshore Global Note in such an amount.



     (d) Transfers of Interests in the Permanent Offshore Global Note or Unlegended Offshore
Physical Notes. The following provisions shall apply with respect to any transfer of interests
in the Permanent Offshore Global Note or unlegended Offshore Physical Notes. The Registrar shall
register the transfer of any such Note without requiring any additional certification.



     (e) Transfers to Non-U.S. Persons at Any Time. The following provisions shall apply
with respect to any transfer of a Note to a Non-U.S. Person:




     (i) Prior to 40 days from the initial issuance of a series of Notes, the Registrar
shall register any proposed transfer of a Note to a Non-U.S. Person upon receipt of a
certificate substantially in the form of Exhibit D hereto from the proposed transferor. On
and after 40 days from the initial issuance of a series of Notes, the Registrar shall
register any proposed transfer to any Non-U.S. Person if the Note to be transferred is a
U.S. Physical Note or an interest in the U.S. Global Note, upon receipt of a certificate
substantially in the form of Exhibit D from the proposed transferor.




     (ii) (a) If the proposed transferor is an Agent Member holding a beneficial interest in
the U.S. Global Note, upon receipt by the Registrar of (x) the documents, if any, required
by paragraph (i) and (y) instructions in accordance with the Depositary’s and the
Registrar’s procedures, the Registrar shall reflect on its books and records the date and a
decrease in the principal amount at maturity of the U.S. Global Note in an amount equal to
the principal amount at maturity of the beneficial interest in the U.S. Global Note to be
transferred, and (b) if the proposed transferee is an Agent Member, upon receipt by the
Registrar of instructions given in accordance with the Depositary’s and the Registrar’s
procedures, the Registrar shall reflect on its books and records the date and an increase in
the principal amount at maturity of the Offshore Global Note in an amount equal to the
principal amount at maturity of the U.S. Physical Notes or the U.S. Global Note, as the case
may be, to be transferred, and the Trustee shall cancel the U.S. Physical Note, if any, so
transferred or decrease the amount of the U.S. Global Note.



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     (f) Private Placement Legend. Upon the transfer, exchange or replacement of Notes not
bearing the Private Placement Legend, the Registrar shall deliver Notes that do not bear the
Private Placement Legend. Upon the transfer, exchange or replacement of Notes bearing the Private
Placement Legend, the Registrar shall deliver only Notes that bear the Private Placement Legend
unless either (i) the circumstances contemplated by the second sentence of the fourth paragraph of
Section 2.01 or paragraph (a)(1)(x) or (e)(ii) of this Section 2.08 exist or (ii) there is
delivered to the Registrar an Opinion of Counsel reasonably satisfactory to FelCor and FelCor LP
and the Trustee to the effect that neither such legend nor the related restrictions on transfer are
required in order to maintain compliance with the provisions of the Securities Act.



     (g) General. By its acceptance of any Note bearing the Private Placement Legend, each
Holder of such a Note acknowledges the restrictions on transfer of such Note set forth in this
Indenture and in the Private Placement Legend and agrees that it will transfer such Note only as
provided in this Indenture. The Registrar shall not register a transfer of any Note unless such
transfer complies with the restrictions on transfer of such Note set forth in this Indenture. In
connection with any transfer of Notes, each Holder agrees by its acceptance of the Notes to furnish
the Registrar or FelCor LP such certifications, legal opinions or other information as either of
them may reasonably require to confirm that such transfer is being made pursuant to an exemption
from, or a transaction not subject to, the registration requirements of the Securities Act;
provided that the Registrar shall not be required to determine (but may rely on a determination
made by FelCor LP with respect to) the sufficiency of any such certifications, legal opinions or
other information.



     The Registrar shall retain copies of all letters, notices and other written communications
received pursuant to Section 2.07 or this Section 2.08. FelCor LP shall have the right to inspect
and make copies of all such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Registrar.



     SECTION 2.09. Replacement Notes. If a mutilated Note is surrendered to the Trustee or if the
Holder claims that the Note has been lost, destroyed or wrongfully taken, FelCor LP shall issue and
the Trustee shall authenticate a replacement Note of like tenor and amount and bearing a number not
contemporaneously outstanding; provided that the requirements of this Section 2.09 are met. If
required by the Trustee or FelCor LP, an indemnity bond must be furnished that is sufficient in the
judgment of both the Trustee and FelCor LP to protect FelCor LP, the Guarantors, the Trustee or any
Agent from any cost, expense or loss that any of them may suffer if a Note is replaced and
subsequently presented or claimed for payment. FelCor LP may charge such Holder for its expenses
and the expenses of the Trustee in replacing a Note. In case any such mutilated, lost, destroyed
or wrongfully taken Note has become or is about to become due and payable, FelCor LP in its
discretion may pay such Note instead of issuing a new Note in replacement thereof.



     Every replacement Note is an additional obligation of FelCor LP and shall be entitled to the
benefits of this Indenture.



     SECTION 2.10. Outstanding Notes. Notes outstanding at any time are all Notes that have been
authenticated by the Trustee except for those cancelled by it, those delivered to it for
cancellation and those described in this Section 2.10 as not outstanding.



     If a Note is replaced pursuant to Section 2.09, it ceases to be outstanding unless and until
the Trustee and FelCor LP receive proof satisfactory to them that the replaced Note is held by a
bona fide purchaser.



     If the Paying Agent (other than FelCor, FelCor LP or an Affiliate of FelCor or FelCor LP)
holds on the maturity date money sufficient to pay Notes payable on that date, then on and after
that date such Notes cease to be outstanding and interest on them shall cease to accrue.



     A Note does not cease to be outstanding because FelCor or FelCor LP or one of their Affiliates
holds such Note; provided that, in determining whether the Holders of the requisite principal
amount of the outstanding Notes have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Notes owned by FelCor, FelCor LP, the Guarantors or any other obligor
upon the Notes or any Affiliate of FelCor LP or the Guarantors or of such other obligor shall be
disregarded and deemed not to be outstanding, except that, in determining whether



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the Trustee shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes which the Trustee knows to be so owned shall be so
disregarded. Notes so owned which have been pledged in good faith may be regarded as outstanding
if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with
respect to such Notes and that the pledgee is not FelCor LP or the Guarantors or any other obligor
upon the Notes or any Affiliate of FelCor LP or the Guarantors or of such other obligor.



     SECTION 2.11. Temporary Notes. Until definitive Notes are ready for delivery, FelCor LP may
prepare and the Trustee shall authenticate temporary Notes. Temporary Notes shall be substantially
in the form of definitive Notes but may have insertions, substitutions, omissions and other
variations determined to be appropriate by the Officers executing the temporary Notes, as evidenced
by their execution of such temporary Notes. If temporary Notes are issued, FelCor LP will cause
definitive Notes to be prepared without unreasonable delay. After the preparation of definitive
Notes, the temporary Notes shall be exchangeable for definitive Notes upon surrender of the
temporary Notes at the office or agency of FelCor LP designated for such purpose pursuant to
Section 4.02, without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Notes FelCor LP shall execute and the Trustee shall authenticate and deliver in exchange
therefor a like principal amount of definitive Notes of authorized denominations. Until so
exchanged, the temporary Notes shall be entitled to the same benefits under this Indenture as
definitive Notes.



     SECTION 2.12. Cancellation. FelCor LP at any time may deliver to the Trustee for cancellation
any Notes previously authenticated and delivered hereunder which FelCor LP may have acquired in any
manner whatsoever, and may deliver to the Trustee for cancellation any Notes previously
authenticated hereunder which FelCor LP has not issued and sold. The Registrar and the Paying
Agent shall forward to the Trustee any Notes surrendered to them for transfer, exchange or payment.
The Trustee shall cancel all Notes surrendered for transfer, exchange, payment or cancellation in
accordance with its normal procedure.



     SECTION 2.13. CUSIP Numbers. FelCor LP in issuing the Notes may use “CUSIP,” “CINS” or “ISIN”
numbers (if then generally in use), and the Trustee shall use CUSIP, CINS or ISIN numbers, as the
case may be, in notices of redemption or exchange as a convenience to Holders; provided that any
such notice shall state that no representation is made as to the correctness of such numbers either
as printed on the Notes or as contained in any notice of redemption or exchange and that reliance
may be placed only on the other identification numbers printed on the Notes.



     SECTION 2.14. Defaulted Interest. If FelCor LP or the Guarantors default in a payment of
interest on the Notes, FelCor LP or the Guarantors shall pay, or shall deposit with the Paying
Agent money in immediately available funds sufficient to pay the defaulted interest, plus (to the
extent lawful) any interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date. A special record date, as used in this Section 2.14 with respect
to the payment of any defaulted interest, shall mean the 15th day next preceding the date fixed by
FelCor LP for the payment of defaulted interest, whether or not such day is a Business Day. At
least 15 days before the subsequent special record date, FelCor LP shall mail to each Holder and to
the Trustee a notice that states the subsequent special record date, the payment date and the
amount of defaulted interest to be paid.



     SECTION 2.15. Issuance of Additional Notes. FelCor LP may, subject to compliance with Article
Four of this Indenture, issue additional Notes under this Indenture. The Notes issued on the
Closing Date and any additional Notes subsequently issued shall be treated as a single class for
all purposes under this Indenture.



ARTICLE III




REDEMPTION




     SECTION 3.01. Optional Redemption. (a) Except as provided in Section 3.01(b), FelCor LP may
not redeem any of the Notes prior to December 1, 2007. The Notes will be redeemable at the option
of FelCor LP, in whole or in part, at any time, and from time to time, on and after December 1,
2007, upon not less than 15 days’ nor more than 60 days’ notice, at the following Redemption Prices
(expressed as percentages of the principal amount thereof) if redeemed during the 12-month period
commencing December 1 of the years indicated below, in each case together with accrued and unpaid
interest thereon to the Redemption Date:



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	Year	 	Redemption Price
	2007
	 	 	101.000	%
	2008 and thereafter
	 	 	100.000	%






     (a) Notwithstanding the foregoing, at any time, or from time to time, on or prior to December
1, 2009, FelCor LP may, at its option, use the net cash proceeds of one or more Equity Offerings to
redeem up to 35% of the principal amount of the Notes issued under this Indenture at a Redemption
Price (expressed as a percentage of the principal amount thereof) equal to the sum of (i) 100% plus
(ii) the then Applicable Interest Rate (as defined in Exhibit A) on the Notes, together with
accrued unpaid interest thereon, if any, to the Redemption Date; provided that (i) at least 65% of
the aggregate principal amount of the Notes issued under this Indenture remains outstanding
immediately after such redemption; and (ii) FelCor LP makes such redemption no later than 90 days
after the consummation of any such Equity Offering.



     SECTION 3.02. Notices to Trustee. If FelCor LP elects to redeem Notes pursuant to Section
3.01, it shall notify the Trustee in writing of the Redemption Date and the principal amount of
Notes to be redeemed in an Officers’ Certificate at least 30 days before the Redemption Date
(unless a shorter period shall be satisfactory to the Trustee).



     SECTION 3.03. Selection of Notes To Be Redeemed. If less than all of the Notes are to be
redeemed at any time, the Trustee shall select the Notes to be redeemed in compliance with the
requirements, as certified to it by FelCor LP, of the principal national securities exchange, if
any, on which the Notes are listed or, on a pro rata basis, by lot or by such other method as the
Trustee in its sole discretion shall deem fair and appropriate; provided that no Notes of $1,000 in
principal amount at maturity shall be redeemed in part. Notwithstanding the foregoing, if less
than all the Notes are to be redeemed with the proceeds of an Equity Offering, the Trustee shall
select the Notes to be redeemed on a pro rata basis or on as nearly a pro rata basis as practicable
(subject to the procedures of the Depositary) unless such method is otherwise prohibited.



     The Trustee shall make the selection from the Notes outstanding and not previously called for
redemption. Notes in denominations of $1,000 in principal amount at maturity may only be redeemed
in whole. The Trustee may select for redemption portions (equal to $1,000 in principal amount at
maturity or any integral multiple thereof) of Notes that have denominations larger than $1,000 in
principal amount at maturity. Provisions of this Indenture that apply to Notes called for
redemption also apply to portions of Notes called for redemption. The Trustee shall notify FelCor
LP and the Registrar promptly in writing of the Notes or portions of Notes to be called for
redemption.



     SECTION 3.04. Notice of Redemption. With respect to any redemption of Notes pursuant to
Section 3.01, at least 15 days but not more than 60 days before a Redemption Date, FelCor LP shall
mail a notice of redemption by first class mail to each Holder whose Notes are to be redeemed.



     The notice shall identify the Notes to be redeemed and shall state:




     (i) the Redemption Date;




     (ii) the Redemption Price;




     (iii) the name and address of the Paying Agent;




     (iv) that Notes called for redemption must be surrendered to the Paying Agent in order
to collect the Redemption Price;




     (v) that, unless FelCor LP defaults in making the redemption payment, interest on Notes
called for redemption ceases to accrue on and after the Redemption Date and the only
remaining right of the Holders is to receive payment of the Redemption Price plus accrued
interest to the Redemption Date upon surrender of the Notes to the Paying Agent;



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     (vi) that, if any Note is being redeemed in part, the portion of the principal amount
(equal to $1,000 in principal amount at maturity or any integral multiple thereof) of such
Note to be redeemed and that, on and after the Redemption Date, upon surrender of such Note,
a new Note or Notes in principal amount at maturity equal to the unredeemed portion thereof
will be reissued; and




     (vii) that, if any Note contains a CUSIP, CINS or ISIN number as provided in Section
2.13, no representation is being made as to the correctness of the CUSIP, CINS or ISIN
number either as printed on the Notes or as contained in the notice of redemption and that
reliance may be placed only on the other identification numbers printed on the Notes.



     At FelCor LP’s request (which request may be revoked by FelCor LP at any time prior to the
time at which the Trustee shall have given such notice to the Holders), made in writing to the
Trustee at least 45 days (or such shorter period as shall be satisfactory to the Trustee) before a
Redemption Date, the Trustee shall give the notice of redemption in the name and at the expense of
FelCor LP; provided that the text of the notice of redemption shall be prepared by FelCor LP. If,
however, FelCor LP gives such notice to the Holders, FelCor LP shall concurrently deliver to the
Trustee an Officers’ Certificate stating that such notice has been given.



     SECTION 3.05. Effect of Notice of Redemption. Once notice of redemption is mailed, Notes
called for redemption become due and payable on the Redemption Date and at the Redemption Price.
Upon surrender of any Notes to the Paying Agent, such Notes shall be paid at the Redemption Price,
plus accrued interest, if any, to the Redemption Date.



     Notice of redemption shall be deemed to be given when mailed, whether or not the Holder
receives the notice. In any event, failure to give such notice, or any defect therein, shall not
affect the validity of the proceedings for the redemption of Notes held by Holders to whom such
notice was properly given.



     SECTION 3.06. Deposit of Redemption Price. On or prior to any Redemption Date, FelCor LP
shall deposit with the Paying Agent (or, if FelCor LP is acting as its own Paying Agent, shall
segregate and hold in trust as provided in Section 2.05) money sufficient to pay the Redemption
Price of and accrued interest on all Notes to be redeemed on that date other than Notes or portions
thereof called for redemption on that date that have been delivered by FelCor LP to the Trustee for
cancellation.



     SECTION 3.07. Payment of Notes Called for Redemption. If notice of redemption has been given
in the manner provided above, the Notes or portion of Notes specified in such notice to be redeemed
shall become due and payable on the Redemption Date at the Redemption Price stated therein,
together with accrued interest to such Redemption Date, and on and after such date (unless FelCor
LP shall default in the payment of such Notes at the Redemption Price and accrued interest to the
Redemption Date, in which case the principal, until paid, shall bear interest from the Redemption
Date at the rate prescribed in the Notes), such Notes shall cease to accrue interest. Upon
surrender of any Note for redemption in accordance with a notice of redemption, such Note shall be
paid and redeemed by FelCor LP at the Redemption Price, together with accrued interest, if any, to
the Redemption Date; provided that installments of interest whose Stated Maturity is on or prior to
the Redemption Date shall be payable to the Holders registered as such at the close of business on
the relevant Regular Record Date.



     SECTION 3.08. Notes Redeemed in Part. Upon surrender of any Note that is redeemed in part,
FelCor LP shall execute and the Trustee shall authenticate and deliver to the Holder a new Note
equal in principal amount to the unredeemed portion of such surrendered Note.



ARTICLE IV




COVENANTS




     SECTION 4.01. Payment of Notes. FelCor LP shall pay the principal of, premium, if any, and
interest on the Notes on the dates and in the manner provided in the Notes and this Indenture. An
installment of principal, premium, if any, or interest shall be considered paid on the date due if
the Trustee or Paying Agent (other than FelCor LP, a Subsidiary of FelCor LP, a Guarantor or any
Affiliate of any of them) holds on that date money designated



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for and sufficient to pay the installment. If FelCor LP, any Subsidiary of FelCor LP, a
Guarantor or any Affiliate of any of them, acts as Paying Agent, an installment of principal,
premium, if any, or interest shall be considered paid on the due date if the entity acting as
Paying Agent complies with the last sentence of Section 2.05. As provided in Section 6.09, upon
any bankruptcy or reorganization procedure relative to FelCor LP or any Guarantor, the Trustee
shall serve as the Paying Agent and conversion agent, if any, for the Notes.



     FelCor LP shall pay interest on overdue principal, premium, if any, and interest on overdue
installments of interest, to the extent lawful, at the rate per annum specified in the Notes.



     SECTION 4.02. Maintenance of Office or Agency. FelCor LP shall maintain in the Borough of
Manhattan, The City of New York an office or agency where Notes may be surrendered for registration
of transfer or exchange or for presentation for payment and where notices and demands to or upon
FelCor LP in respect of the Notes and this Indenture may be served. FelCor LP will give prompt
written notice to the Trustee of the location, and any change in the location, of such office or
agency. If at any time FelCor LP shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices
and demands may be made or served at the address of the Trustee set forth in Section 10.02.



     FelCor LP may also from time to time designate one or more other offices or agencies where the
Notes may be presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided that no such designation or rescission shall in any manner
relieve FelCor LP of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York for such purposes. FelCor LP shall give prompt written notice to the Trustee
of any such designation or rescission and of any change in the location of any such other office or
agency.



     FelCor LP hereby initially designates U.S. Bank National Association, 100 Wall Street, Suite
1600, New York, New York 10005, as agent for FelCor LP, located in the Borough of Manhattan, The
City of New York, as such office of FelCor LP in accordance with Section 2.04.



     SECTION 4.03. Limitation on Indebtedness. (a) Neither FelCor LP nor FelCor shall, and
neither FelCor LP nor FelCor shall permit any of their respective Restricted Subsidiaries to, Incur
any Indebtedness if, immediately after giving effect to the Incurrence of such additional
Indebtedness, the aggregate principal amount of all outstanding Indebtedness of FelCor LP, FelCor
and their respective Restricted Subsidiaries on a consolidated basis determined in accordance with
GAAP is greater than 60% of Adjusted Total Assets.



     (b) Neither FelCor LP nor FelCor shall, and neither FelCor LP nor FelCor shall permit any of
their respective Restricted Subsidiaries to, Incur any Subsidiary Debt or any Secured Indebtedness
if, immediately after giving effect to the Incurrence of such additional Subsidiary Debt or Secured
Indebtedness, the aggregate principal amount of all outstanding Subsidiary Debt and Secured
Indebtedness of FelCor LP, FelCor and their respective Restricted Subsidiaries on a consolidated
basis is greater than 45% of Adjusted Total Assets.



     (c) Neither FelCor LP nor FelCor shall, and neither FelCor LP nor FelCor shall permit any of
their respective Restricted Subsidiaries to, Incur any Indebtedness (other than the Existing Senior
Notes, the Subsidiary Guarantees relating to the Existing Senior Notes and other Indebtedness
existing on the Closing Date); provided that FelCor LP or FelCor or any of their respective
Restricted Subsidiaries may Incur Indebtedness if, after giving effect to the Incurrence of such
Indebtedness and the receipt and application of the proceeds therefrom, the Interest Coverage Ratio
of FelCor LP, FelCor and their respective Restricted Subsidiaries on a consolidated basis would be
greater than 2.0 to 1.



     (d) Notwithstanding paragraph (a), (b) or (c) of this Section 4.03, FelCor LP or FelCor or any
of their respective Restricted Subsidiaries (except as specified below) may Incur each and all of
the following:




     (i) Indebtedness outstanding under any Line of Credit at any time in an aggregate
principal amount not to exceed the greater of (a) $125 million or (b) 1.5 times Consolidated
EBITDA for the then most recent four fiscal quarters completed prior to such Transaction
Date for which reports have been filed



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with the Commission or provided to the Trustee pursuant to Section 4.17, less any
amount of such Indebtedness under any Line of Credit permanently repaid as provided under
Section 4.10;




     (ii) Indebtedness owed to:




     (A) FelCor LP or FelCor evidenced by an unsubordinated promissory note, or




     (B) to any Restricted Subsidiary;


provided that any event which results in any such Restricted Subsidiary ceasing to be a Restricted
Subsidiary or any subsequent transfer of such Indebtedness (other than to FelCor LP or FelCor or
any other Restricted Subsidiary) shall be deemed, in each case, to constitute an Incurrence of such
Indebtedness not permitted by this clause (ii);





     (iii) Indebtedness issued in exchange for, or the net proceeds of which are used to
refinance or refund, outstanding Indebtedness (other than Indebtedness Incurred under clause
(i), (ii), (iv) or (vi) of this paragraph (d)) and any refinancings thereof in an amount not
to exceed the amount so refinanced or refunded (plus premiums, accrued interest, fees and
expenses); provided that Indebtedness the proceeds of which are used to refinance or refund
the Notes or Indebtedness that pari passu with or is subordinated in right of payment to,
the Notes shall only be permitted under this clause (iii) if:




     (A) in case the Notes are refinanced in part or the Indebtedness to be
refinanced is pari passu with the Notes, such new Indebtedness, by its terms or by
the terms of any agreement or instrument pursuant to which such new Indebtedness is
outstanding, is pari passu with or is expressly made subordinate in right of payment
to the remaining Notes,




     (B) in case the Indebtedness to be refinanced is subordinated in right of
payment to the Notes, such new Indebtedness, by its terms or by the terms of any
agreement or instrument pursuant to which such new Indebtedness is issued or remains
outstanding, is expressly made subordinate in right of payment to the Notes at least
to the extent that the Indebtedness to be refinanced is subordinated to the Notes,
and




     (C) such new Indebtedness, determined as of the date of Incurrence of such new
Indebtedness, does not mature prior to the Stated Maturity of the Indebtedness to be
refinanced, and the Average Life of such new Indebtedness is at least equal to the
remaining Average Life of the Indebtedness to be refinanced or refunded;


provided further that in no event may Indebtedness of FelCor LP or FelCor that is pari passu with
or subordinated in right of payment to the Notes be refinanced by means of any Indebtedness of any
Restricted Subsidiary pursuant to this clause (iii);





     (iv) Indebtedness;




     (A) in respect of performance, surety or appeal bonds provided in the ordinary
course of business,




     (B) under Currency Agreements and Interest Rate Agreements; provided that such
agreements (1) are designed solely to protect FelCor LP or FelCor or any of their
respective Restricted Subsidiaries against fluctuations in foreign currency exchange
rates or interest rates and (2) do not increase the Indebtedness of the obligor
outstanding at any time other than as a result of fluctuations in foreign currency
exchange rates or interest rates or by reason of fees, indemnities and compensation
payable thereunder, and




     (C) arising from agreements providing for indemnification, adjustment of
purchase price or similar obligations, or from Guarantees or letters of credit,
surety bonds or performance bonds securing any obligations of FelCor LP or FelCor or
any of their respective Restricted Subsidiaries



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pursuant to such agreements, in any case Incurred in connection with
the disposition of any business, assets or Restricted Subsidiary (other than
Guarantees of Indebtedness Incurred by any Person acquiring all or any portion of
such business, assets or Restricted Subsidiary for the purpose of financing such
acquisition), in a principal amount not to exceed the gross proceeds actually
received by FelCor LP, FelCor and their respective Restricted Subsidiaries on a
consolidated basis in connection with such disposition;




     (v) Indebtedness of FelCor LP or FelCor, to the extent the net proceeds thereof are
promptly




     (A) used to purchase Notes tendered in an Offer to Purchase made as a result of
a Change in Control, or




     (B) deposited to defease the Notes in accordance with Section 8.02 or 8.03; or




     (vi) Guarantees of the Notes and the Existing Notes and Guarantees of Indebtedness of
FelCor LP or FelCor by any of their respective Restricted Subsidiaries provided the
guarantee of such Indebtedness is permitted by and made in accordance with Section 4.07.



     (e) Notwithstanding any other provision of this Section 4.03, the maximum amount of
Indebtedness that FelCor LP or FelCor or any of their respective Restricted Subsidiaries may Incur
pursuant to this Section 4.03 shall not be deemed to be exceeded, with respect to any outstanding
Indebtedness due solely to the result of fluctuations in the exchange rates of currencies.



     (f) For purposes of determining any particular amount of Indebtedness under this Section 4.03:




     (1) Guarantees, Liens or obligations with respect to letters of credit supporting
Indebtedness otherwise included in the determination of such particular amount shall not be
included, and




     (2) any Liens granted pursuant to the equal and ratable provisions referred to in
Section 4.09 shall not be treated as Indebtedness.


For purposes of determining compliance with this Section 4.03, in the event that an item of
Indebtedness meets the criteria of more than one of the types of Indebtedness described in the
above clauses (other than Indebtedness referred to in clause (2) of the preceding sentence), each
of FelCor LP and FelCor, in its sole discretion, shall classify such item of Indebtedness and only
be required to include the amount and type of such Indebtedness in one of such clauses; provided
that FelCor LP and FelCor must classify such item of Indebtedness in an identical fashion; provided
further that FelCor LP and FelCor may divide and classify an item of Indebtedness in one or more of
the types of Indebtedness and may later reclassify all or a portion of such item of Indebtedness,
in any manner that complies with this Section 4.03.




     SECTION 4.04. Limitation on Restricted Payments. Neither FelCor LP nor FelCor shall, and
neither FelCor LP nor FelCor permit any of their respective Restricted Subsidiaries to, directly or
indirectly,




     (i) declare or pay any dividend or make any distribution on or with respect to its
Capital Stock held by Persons other than FelCor LP or FelCor or any of their respective
Restricted Subsidiaries, other than:




     (x) dividends or distributions payable solely in shares of its Capital Stock
(other than Disqualified Stock) or in options, warrants or other
rights to acquire shares of such Capital Stock, and




     (y) pro rata dividends or distributions on Common Stock of FelCor LP or any
Restricted Subsidiary held by minority stockholders;




     (ii) purchase, redeem, retire or otherwise acquire for value any shares of Capital
Stock of:



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     (A) FelCor LP, FelCor or an Unrestricted Subsidiary (including options,
warrants or other rights to acquire such shares of Capital Stock) held by any Person
other than FelCor LP or FelCor or any of their respective Restricted Subsidiaries
unless in connection with such purchase the Unrestricted Subsidiary is designated as
a Restricted Subsidiary, or




     (B) a Restricted Subsidiary (including options, warrants or other rights to
acquire such shares of Capital Stock) held by an Affiliate of FelCor LP or FelCor
(other than a Wholly Owned Restricted Subsidiary) or any holder (or any Affiliate of
such holder) of 5% or more of the Capital Stock of FelCor LP or FelCor;




     (iii) make any voluntary or optional principal payment, or voluntary or optional
redemption, repurchase, defeasance, or other acquisition or retirement for value, of
Indebtedness of FelCor LP or FelCor that is subordinated in right of payment to the Notes;
or




     (iv) make an Investment, other than a Permitted Investment, in any Person


(such payments or any other actions described in clauses (i) through (iv) above being
collectively “Restricted Payments”) if, at the time of, and after giving effect to, the
proposed Restricted Payment:





     (A) a Default or Event of Default shall have occurred and be continuing,




     (B) FelCor LP or FelCor could not Incur at least $1.00 of Indebtedness under paragraphs
(a), (b) and (c) of Section 4.03, or




     (C) the aggregate amount of all Restricted Payments (the amount, if other than in cash,
to be determined in good faith by the Board of Directors, whose determination shall be
conclusive and evidenced by a Board Resolution) made after September 15, 2000 shall exceed
the sum of:




     (1) 95% of the aggregate amount of the Funds From Operations (or, if the Funds
From Operations is a loss, minus 100% of the amount of such loss) (determined by
excluding income resulting from transfers of assets by FelCor LP or FelCor or any of
their respective Restricted Subsidiaries to an Unrestricted Subsidiary) accrued on a
cumulative basis during the period (taken as one accounting period) beginning on
July 1, 2000 and ending on the last day of the last fiscal quarter completed
preceding the Transaction Date for which reports have been filed with the Commission
or provided to the Trustee pursuant to Section 4.17, plus




     (2) the aggregate Net Cash Proceeds received by FelCor LP or FelCor after
September 15, 2000 from the issuance and sale permitted by this Indenture of its
Capital Stock (other than Disqualified Stock) to a Person who is not a Subsidiary of
FelCor LP or FelCor, including an issuance or sale permitted by this Indenture of
Indebtedness of FelCor LP or FelCor for cash subsequent to September 15, 2000 upon
the conversion of such Indebtedness into Capital Stock (other than Disqualified
Stock) of FelCor LP or FelCor, or from the issuance to a Person who is not a
Subsidiary of FelCor LP or FelCor of any options, warrants or other rights to
acquire Capital Stock of FelCor LP or FelCor (in each case, exclusive of any
Disqualified Stock or any options, warrants or other rights that are redeemable at
the option of the holder, or are required to be redeemed, prior to the Stated
Maturity of the Notes), plus




     (3) an amount equal to the net reduction in Investments (other than reductions
in Permitted Investments) in any Person resulting from payments of interest on
Indebtedness, dividends, repayments of loans or advances, or other transfers of
assets, in each case to FelCor LP or FelCor or any of their respective Restricted
Subsidiaries or from the Net Cash Proceeds from the sale of any such Investment
(except, in each case, to the extent any such payment or proceeds are included in
the calculation of Funds From Operations) or from redesignations of Unrestricted
Subsidiaries as Restricted Subsidiaries (valued in each case as provided in the
definition of “Investments”)



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not to exceed, in each case, the amount of Investments previously made
by FelCor LP, FelCor and their respective Restricted Subsidiaries in such Person or
Unrestricted Subsidiary, plus




     (4) the purchase price of noncash tangible assets acquired in exchange for an
issuance of Capital Stock (other than Disqualified Stock) of FelCor LP or FelCor
subsequent to September 15, 2000.



     Notwithstanding the foregoing, FelCor LP or FelCor may declare or pay any dividend or make any
distribution, so long as FelCor believes in good faith that FelCor qualifies as a REIT under the
Code and the declaration or payment of any dividend or the making of any distribution is necessary
either to maintain FelCor’s status as a REIT under the Code for any calendar year or to enable
FelCor to avoid payment of any tax for any calendar year that could be avoided by reason of a
distribution by FelCor to its shareholders, with such distribution to be made as and when
determined by FelCor, whether during or after the end of, the relevant calendar year, if:




     (1) the aggregate principal amount of all outstanding Indebtedness of FelCor LP or
FelCor on a consolidated basis at such time is less than 80% of Adjusted Total Assets, and




     (2) no Default or Event of Default shall have occurred and be continuing.



     The foregoing provisions of this Section 4.04 shall not be violated by reason of:




     (i) the payment of any dividend within 60 days after the date of declaration thereof
if, at said date of declaration, such payment would comply with the foregoing paragraph;




     (ii) the redemption, repurchase, defeasance or other acquisition or retirement for
value of Indebtedness that is subordinated in right of payment to the Notes including
premium, if any, and accrued and unpaid interest, with the proceeds of, or in exchange for,
Indebtedness Incurred under clause (iii) of paragraph (d) of Section 4.03;




     (iii) the repurchase, redemption or other acquisition of Capital Stock of FelCor LP or
FelCor or an Unrestricted Subsidiary (or options, warrants or other rights to acquire such
Capital Stock) in exchange for, or out of the proceeds of a substantially concurrent
issuance of, shares of Capital Stock (other than Disqualified Stock) of FelCor LP or FelCor
(or options, warrants or other rights to acquire such Capital Stock);




     (iv) the making of any principal payment on, or the repurchase, redemption, retirement,
defeasance or other acquisition for value of, Indebtedness of FelCor LP or FelCor which is
subordinated in right of payment to the Notes in exchange for, or out of the proceeds of, a
substantially concurrent issuance of, shares of the Capital Stock (other than Disqualified
Stock) of FelCor LP or FelCor (or options, warrants or other rights to acquire such Capital
Stock);




     (v) payments or distributions, to dissenting stockholders pursuant to applicable law
pursuant to or in connection with a consolidation, merger or transfer of assets that
complies with the provisions of this Indenture applicable to mergers, consolidations and
transfers of all or substantially all of the property and assets of FelCor LP or FelCor;




     (vi) the declaration or payment of any dividend or other distribution in respect of
Capital Stock of FelCor, FelCor LP or its respective Restricted Subsidiaries constituting
Preferred Stock, so long as the Interest Coverage Ratio contemplated by paragraph (c) of
Section 4.03 shall be greater than or equal to 1.7 to 1;




     (vii) Investments in any Person or Persons in an aggregate amount not to exceed $150
million; or



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     (viii) any other Restricted Payments in an aggregate amount not to exceed $100 million,
provided that at the time of, and after giving effect to, the proposed Restricted Payment
FelCor LP and FelCor could have incurred at least $1.00 of Indebtedness under paragraphs
(a), (b) and (c) of Section 4.03;


provided that, except in the case of clauses (i) and (iii), no Default or Event of Default shall
have occurred and be continuing or occur as a direct consequence of the actions or payments set
forth therein. Each Restricted Payment permitted pursuant to this paragraph (other than the
Restricted Payment referred to in clause (ii) of this paragraph, an exchange of Capital Stock for
Capital Stock or Indebtedness referred to in clause (iii) or (iv) of this paragraph, an Investment
referred to in clause (vi) of this paragraph or a Restricted Payment referred to in clause (vii) of
this paragraph), and the Net Cash Proceeds from any issuance of Capital Stock referred to in
clauses (iii) and (iv), shall be included in calculating whether the conditions of clause (C) of
the first paragraph of this Section 4.04 have been met with respect to any subsequent Restricted
Payments.




     SECTION 4.05. Limitation on Dividend and Other Payment Restrictions Affecting Restricted
Subsidiaries. Neither FelCor LP nor FelCor shall, and neither FelCor LP nor FelCor shall permit
any of their respective Restricted Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the ability of any
Restricted Subsidiary to:




     (i) pay dividends or make any other distributions permitted by applicable law on any
Capital Stock of such Restricted Subsidiary owned by FelCor LP or FelCor or any of their
respective Restricted Subsidiaries,




     (ii) pay any Indebtedness owed to FelCor LP, FelCor or any other Restricted Subsidiary,




     (iii) make loans or advances to FelCor LP, FelCor or any other Restricted Subsidiary, or




     (iv) transfer its property or assets to FelCor LP, FelCor or any other Restricted Subsidiary.



     The foregoing provisions shall not restrict any encumbrances or restrictions:




     (i) existing on the Closing Date in this Indenture, the Line of Credit, and any other
agreement in effect on the Closing Date, and any extensions, refinancings, renewals or
replacements of such agreements; provided that the encumbrances and restrictions in any such
extensions, refinancings, renewals or replacements are no less favorable in any material
respect to the Holders than those encumbrances or restrictions that are then in effect and
that are being extended, refinanced, renewed or replaced;




     (ii) existing under or by reason of applicable law;




     (iii) existing with respect to any Person or the property or assets of such Person
acquired by FelCor LP, FelCor or any Restricted Subsidiary, existing at the time of such
acquisition and not incurred in contemplation thereof, which encumbrances or restrictions
are not applicable to any Person or the property or assets of any Person other than such
Person or the property or assets of such Person so acquired;




     (iv) in the case of clause (iv) of the first paragraph of this Section 4.05,




     (A) that restrict in a customary manner the subletting, assignment or transfer
of any property or asset that is a lease, license, conveyance or contract or similar
property or asset,




     (B) existing by virtue of any transfer of, agreement to transfer, option or
right with respect to, or Lien on, any property or assets of FelCor LP, FelCor or
any Restricted Subsidiary not otherwise prohibited by this Indenture, or




     (C) arising or agreed to in the ordinary course of business, not relating to
any Indebtedness, and that do not, individually or in the aggregate, detract from
the value of property or



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assets of FelCor LP, FelCor or any Restricted Subsidiary in any manner material
to FelCor LP, FelCor and their respective Restricted Subsidiaries taken as a whole;




     (v) with respect to a Restricted Subsidiary and imposed pursuant to an agreement that
has been entered into for the sale or disposition of all or substantially all of the Capital
Stock of, or property and assets of, such Restricted Subsidiary; or




     (vi) contained in the terms of any Indebtedness or any agreement pursuant to which such
Indebtedness was issued if:




     (A) the encumbrance or restriction applies only in the event of a payment
default or a default with respect to a financial covenant contained in such
Indebtedness or agreement,




     (B) the encumbrance or restriction is not materially more disadvantageous to
the Holders of the Notes than is customary in comparable financings (as determined
by FelCor LP and FelCor), and




     (C) each of FelCor LP and FelCor determines that any such encumbrance or
restriction will not materially affect such Persons’ ability to make principal or
interest payments on the Notes.



     Nothing contained in this Section 4.05 shall prevent FelCor LP, FelCor or any Restricted
Subsidiary from:




     (1) creating, incurring, assuming or suffering to exist any Liens otherwise permitted
in Section 4.09, or




     (2) restricting the sale or other disposition of property or assets of FelCor LP or
FelCor or any of their respective Restricted Subsidiaries that secure Indebtedness of FelCor
LP, FelCor or any of their respective Restricted Subsidiaries.



     SECTION 4.06. Limitation on the Issuance and Sale of Capital Stock of Restricted Subsidiaries.
Neither FelCor LP nor FelCor shall sell, and neither FelCor LP nor FelCor shall permit any of
their respective Restricted Subsidiaries, directly or indirectly, to issue or sell, any shares of
Capital Stock of a Restricted Subsidiary (including options, warrants or other rights to purchase
shares of such Capital Stock) except:




     (i) to FelCor LP, FelCor or a Wholly Owned Restricted Subsidiary;




     (ii) issuances of director’s qualifying shares or sales to individuals of shares of
Restricted Subsidiaries, to the extent required by applicable law or to the extent necessary
to obtain local liquor licenses;




     (iii) if, immediately after giving effect to such issuance or sale, such Restricted
Subsidiary would no longer constitute a Subsidiary and any Investment in such Person
remaining after giving effect to such issuance or sale would have been permitted to be made
under Section 4.04 if made on the date of such issuance or sale; or




     (iv) sales of not greater than 20% of the Capital Stock of a newly-created Restricted
Subsidiary made in connection with, or in contemplation of, the acquisition or development
by such Restricted Subsidiary of one or more properties to any Person that is, or is an
Affiliate of, the entity that provides, franchise, management or other services, as the case
may be, to one or more properties owned by such Restricted Subsidiary.



     SECTION 4.07. Limitation on Issuances of Guarantees by Restricted Subsidiaries. Neither
FelCor LP nor FelCor will permit any of their respective Restricted Subsidiaries, directly or
indirectly, to Guarantee any Indebtedness of FelCor LP or FelCor which is pari passu with or
subordinate in right of payment to the Notes (“Guaranteed Indebtedness”), unless:



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     (i) such Restricted Subsidiary simultaneously executes and delivers a supplemental
indenture to this Indenture providing for a Subsidiary Guarantee by such Restricted
Subsidiary, and




     (ii) such Restricted Subsidiary waives and will not in any manner whatsoever claim or
take the benefit or advantage of, any rights of reimbursement, indemnity or subrogation or
any other rights against FelCor LP, FelCor or any other Restricted Subsidiary as a result of
any payment by such Restricted Subsidiary under its Subsidiary Guarantee;


provided that this Section 4.07 shall not be applicable to any Guarantee of any Restricted
Subsidiary that existed at the time such Person became a Restricted Subsidiary and was not Incurred
in connection with, or in contemplation of, such person becoming a Restricted Subsidiary. If the
Guaranteed Indebtedness is:





     (A) pari passu with the Notes, then the Guarantee of such Guaranteed Indebtedness shall
be pari passu in right of payment with, or subordinated in right of payment to, the
Subsidiary Guarantee, or




     (B) subordinate in right of payment to the Notes, then the Guarantee of such Guaranteed
Indebtedness shall be subordinated in right of payment to the Subsidiary Guarantee at least
to the extent that the Guaranteed Indebtedness is subordinated in right of payment to the
Notes.



     SECTION 4.08. Limitation on Transactions with Affiliates. Neither FelCor LP nor FelCor shall,
and neither FelCor LP nor FelCor shall permit any of their respective Restricted Subsidiaries to,
directly or indirectly, enter into, renew or extend any transaction (including, without
limitations, the purchase, sale, lease or exchange of property or assets, or the rendering of any
service) with any holder (or any Affiliate of such holder) of 5% or more of any class of Capital
Stock of FelCor LP or FelCor or with any Affiliate of FelCor LP or FelCor or any of their
respective Restricted Subsidiaries, except upon fair and reasonable terms no less favorable to
FelCor LP, FelCor or such Restricted Subsidiary than could be obtained, at the time of such
transaction or, if such transaction is pursuant to a written agreement, at the time of the
execution of the agreement providing therefor, in a comparable arm’s-length transaction with a
Person that is not such a holder or an Affiliate.



     The foregoing limitation shall not limit, and shall not apply to: (i) transactions (A)
approved by a majority of the independent directors of FelCor or (B) for which FelCor LP, FelCor or
any Restricted Subsidiary delivers to the Trustee a written opinion of a nationally recognized
investment banking firm stating that the transaction is fair to FelCor LP, FelCor or such
Restricted Subsidiary from a financial point of view; (ii) any transaction solely between FelCor LP
or FelCor and any of their respective Wholly Owned Restricted Subsidiaries or solely between Wholly
Owned Restricted Subsidiaries; (iii) the payment of reasonable and customary fees and expenses to
directors of FelCor who are not employees of FelCor; (iv) any payments or other transactions
pursuant to any tax-sharing agreement between FelCor LP or FelCor and any other Person with which
FelCor LP or FelCor files a consolidated tax return or with which FelCor LP or FelCor is part of a
consolidated group for tax purposes; or (v) any Restricted Payments not prohibited by Section 4.04.
Notwithstanding the foregoing, any transaction or series of related transactions covered by the
first paragraph of this Section 4.08 and not covered by clauses (ii) through (v) of this paragraph,
(a) the aggregate amount of which exceeds $2 million in value, must be approved or determined to be
fair in the manner provided for in clause (i)(A) or (B) above, and (b) the aggregate amount of
which exceeds $5 million in value, must be determined to be fair in the manner provided for in
clause (i)(B) above.



     SECTION 4.09. Limitation on Liens. Neither FelCor LP nor FelCor shall (i) secure any
Indebtedness under any Line of Credit by a Lien (other than Indebtedness Incurred under Section
4.03(d)(i) in an aggregate amount not to exceed $100 million at any one time outstanding) unless
contemporaneously therewith effective provision is made to secure the Notes equally and ratably
with the Indebtedness under such Line of Credit for so long as the Indebtedness under such Line of
Credit is secured by such Lien and (ii) cause or permit any of their respective Restricted
Subsidiaries to directly or indirectly create, incur, assume or permit to suffer to exist any Lien
of any kind against or upon the Capital Stock of any such Restricted Subsidiary that is a Guarantor
whether owned on the Closing Date or acquired thereafter unless contemporaneously therewith
effective provision is made to secure the Notes equally and ratably with such Lien (such Lien to be
subordinated to the Lien on the Notes to the extent securing subordinated Indebtedness).



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     SECTION 4.10. Limitation on Asset Sales. Neither FelCor LP nor FelCor shall, and neither
FelCor LP or FelCor shall permit any of their respective Restricted Subsidiaries to, consummate any
Asset Sale, unless:




     (i) the consideration received by FelCor LP, FelCor or such Restricted Subsidiary is at
least equal to the fair market value of the assets sold or disposed of, and




     (ii) at least 75% of the consideration received consists of cash or Temporary Cash
Investments; provided, with respect to the sale of one or more hotel properties that up to
75% of the consideration may consist of indebtedness of the purchaser of such hotel
properties; provided, further, that such indebtedness is secured by a first priority Lien on
the hotel property or properties sold.



     In the event and to the extent that the Net Cash Proceeds received by FelCor LP, FelCor or
such Restricted Subsidiary from one or more Asset Sales occurring on or after the Closing Date in
any period of 12 consecutive months exceed 10% of Adjusted Consolidated Net Tangible Assets
(determined as of the date closest to the commencement of such 12-month period for which a
consolidated balance sheet of FelCor LP, FelCor and their respective Restricted Subsidiaries has
been filed with the Commission or provided to the Trustee pursuant to Section 4.17), then FelCor LP
or FelCor shall or shall cause the relevant Restricted Subsidiary to:




     (i) within twelve months after the date Net Cash Proceeds so received exceed 10% of
Adjusted Consolidated Net Tangible Assets:




     (A) apply an amount equal to such excess Net Cash Proceeds to permanently
reduce Senior Indebtedness of FelCor LP, FelCor, or any Restricted Subsidiary or
Indebtedness of any other Restricted Subsidiary, in each case owing to a Person
other than FelCor LP, FelCor or any of their respective Restricted Subsidiaries, or




     (B) invest an equal amount, or the amount not so applied pursuant to the
foregoing clause (A) (or enter into a definitive agreement committing to so invest
within 12 months after the date of such agreement), in property or assets (other
than current assets) of a nature or type or that are used in a business (or in a
Restricted Subsidiary having property and assets of a nature or type, or engaged in
a business) similar or related to the nature or type of the property and assets of,
or the business of, FelCor LP or FelCor or any of their respective Restricted
Subsidiaries existing on the date of such investment and




     (ii) apply (no later than the end of the 12-month period referred to in clause (i))
such excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as provided
in the following paragraph of this Section 4.10.



     The amount of such excess Net Cash Proceeds required to be applied (or to be committed to be
applied) during such 12-month period as set forth in clause (i) of the preceding sentence and not
applied as so required by the end of such period shall constitute “Excess Proceeds.” If, as of the
first day of any calendar month, the aggregate amount of Excess Proceeds not previously subject to
an Offer to Purchase pursuant to this Section 4.10 totals at least $10 million, FelCor LP shall
commence, not later than the fifteenth Business Day of such month, and consummate an Offer to
Purchase from the Holders and all holders of other Indebtedness that is pari passu with the Notes
containing provisions similar to this Section 4.10 (including the Existing Notes) on a pro rata
basis an aggregate principal amount of Notes and such other Indebtedness equal to the Excess
Proceeds on such date, at a purchase price equal to 100% of the principal amount of the Notes and
such other Indebtedness, plus, in each case, accrued interest (if any) to the Payment Date.



     SECTION 4.11. Repurchase of Notes upon a Change of Control. FelCor LP shall commence, within
30 days of the occurrence of a Change of Control, and consummate an Offer to Purchase for all Notes
then outstanding, at a purchase price equal to 101% of the principal amount thereof, plus accrued
and unpaid interest, if any, to the Payment Date.



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     SECTION 4.12. Existence. Subject to Articles IV and V of this Indenture, FelCor LP and the
Guarantors shall do or cause to be done all things necessary to preserve and keep in full force and
effect their existence and the existence of each Restricted Subsidiary in accordance with the
respective organizational documents of FelCor LP, the Guarantors and each Restricted Subsidiary and
the rights (whether pursuant to charter, partnership certificate, agreement, statute or otherwise),
material licenses and franchises of FelCor LP, the Guarantors and each Restricted Subsidiary;
provided that neither FelCor nor FelCor LP shall be required to preserve any such right, license or
franchise, or the existence of any Restricted Subsidiary or Subsidiary Guarantor, if the
maintenance or preservation thereof is no longer desirable in the conduct of the business of FelCor
LP, the Guarantors and their Restricted Subsidiaries taken as a whole.



     SECTION 4.13. Payment of Taxes and Other Claims. FelCor and FelCor LP shall pay or discharge
and shall cause each of their respective Restricted Subsidiaries to pay or discharge, or cause to
be paid or discharged, before the same shall become delinquent (i) all material taxes, assessments
and governmental charges levied or imposed upon (a) FelCor and FelCor LP or any such Restricted
Subsidiary, (b) the income or profits of any such Restricted Subsidiary which is a corporation or
(c) the property of FelCor, FelCor LP or any such Restricted Subsidiaries and (ii) all material
lawful claims for labor, materials and supplies that, if unpaid, might by law become a lien upon
the property of FelCor, FelCor LP or any such Restricted Subsidiary; provided that FelCor and
FelCor LP shall not be required to pay or discharge, or cause to be paid or discharged, any such
tax, assessment, charge or claim the amount, applicability or validity of which is being contested
in good faith by appropriate proceedings and for which adequate reserves have been established.



     SECTION 4.14. Maintenance of Properties and Insurance. FelCor and FelCor LP shall cause all
properties used or useful in the conduct of their business or the business of any of their
Restricted Subsidiaries, to be maintained and kept in good condition, repair and working order and
supplied with all necessary equipment and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of FelCor or FelCor LP
may be necessary so that the business carried on in connection therewith may be properly conducted
at all times; provided that nothing in this Section 4.14 shall prevent FelCor, FelCor LP or any
such Restricted Subsidiary from discontinuing the use, operation or maintenance of any of such
properties or disposing of any of them, if such discontinuance or disposal is, in the judgment of
FelCor, FelCor LP, desirable in the conduct of the business of FelCor, FelCor LP or such Restricted
Subsidiary.



     Each of FelCor and FelCor LP shall provide or cause to be provided, for itself and its
Restricted Subsidiaries, insurance (including appropriate self-insurance) against loss or damage of
the kinds customarily insured against by corporations similarly situated and owning like
properties, with reputable insurers or with the government of the United States of America, or an
agency or instrumentality thereof, in such amounts, with such deductibles and by such methods as
shall be customary for corporations similarly situated in the industry in which FelCor, FelCor LP
or such Restricted Subsidiary, as the case may be, is then conducting business.



     SECTION 4.15. Notice of Defaults. In the event that FelCor LP becomes aware of any Default or
Event of Default, FelCor LP, promptly after it becomes aware thereof, shall give written notice
thereof to the Trustee.



     SECTION 4.16. Compliance Certificates. (a) FelCor and FelCor LP shall deliver to the
Trustee, within 45 days after the end of each fiscal quarter (90 days after the end of the last
fiscal quarter of each year), an Officers’ Certificate stating whether or not the signers know of
any Default or Event of Default that occurred during such fiscal quarter. In the case of the
Officers’ Certificate delivered within 90 days of the end of FelCor’s and FelCor LP’s fiscal year,
such certificate shall contain a certification from the principal executive officer, principal
financial officer or principal accounting officer that a review has been conducted of the
activities of FelCor and FelCor LP and their Restricted Subsidiaries and FelCor’s and FelCor LP’s
and their Restricted Subsidiaries’ performance under this Indenture and that, to the knowledge of
such Officers, FelCor and FelCor LP have complied with all conditions and covenants under this
Indenture. For purposes of this Section 4.16, such compliance shall be determined without regard
to any period of grace or requirement of notice provided under this Indenture. If they do know of
such a Default or Event of Default, the certificate shall describe any such Default or Event of
Default and its status. The first certificate to be delivered pursuant to this Section 4.16(a)
shall be for the first fiscal quarter beginning after the execution of this Indenture.



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     (b) Within 90 days of the end of each of FelCor and FelCor LP’s fiscal years, FelCor and
FelCor LP shall deliver to the Trustee a list of all Significant Subsidiaries. The Trustee shall
have no duty with respect to any such list except to keep it on file and available for inspection
by the Holders.



     SECTION 4.17. Commission Reports and Reports to Holders. At all times from and after the date
of this Indenture, whether or not FelCor or FelCor LP is then required to file reports with the
Commission, FelCor and FelCor LP shall file with the Commission all such reports and other
information as they would be required to file with the Commission by Sections 13(a) or 15(d) under
the Exchange Act if they were subject thereto; provided that, if filing such documents by FelCor LP
or FelCor with the Commission is not permitted under the Exchange Act, FelCor LP or FelCor shall
provide such documents to the Trustee and upon written request supply copies of such documents to
any prospective Holder; provided, further, that if the rules and regulations of the Commission
permit FelCor LP and FelCor to file combined reports or information pursuant to the Exchange Act,
FelCor LP and FelCor may file combined reports and information. FelCor LP and FelCor shall supply
the Trustee and each Holder or shall supply to the Trustee for forwarding to each such Holder,
without cost to such Holder, copies of such reports and other information. Delivery of such
reports, information and documents to the Trustee is for informational purposes only and the
Trustee’s receipt of such shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including FelCor or FelCor LP’s
compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers’ Certificates). In addition, upon the request of any Holder or any
prospective purchaser of the Notes designated by a Holder, FelCor LP shall supply to such Holder or
such prospective purchaser the information required under Rule 144A under the Securities Act.
FelCor LP also shall comply with the other provisions of TIA Section 314(a).



     SECTION 4.18. Waiver of Stay, Extension or Usury Laws. FelCor LP covenants (to the extent
that it may lawfully do so) that it shall not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive FelCor LP from paying all or any portion of the principal
of, premium, if any, or interest on the Notes as contemplated herein, wherever enacted, now or at
any time hereafter in force, or that may affect the covenants or the performance of this Indenture;
and (to the extent that it may lawfully do so) FelCor LP hereby expressly waives all benefit or
advantage of any such law and covenants that it will not hinder, delay or impede the execution of
any power herein granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.



     SECTION 4.19. Limitation on Sale-Leaseback Transactions. Neither FelCor LP nor FelCor shall,
and neither FelCor LP nor FelCor shall permit any of their respective Restricted Subsidiaries to,
enter into any sale-leaseback transaction involving any of its assets or properties whether now
owned or hereafter acquired, whereby any of them sells or transfers such assets or properties and
then or thereafter leases such assets or properties or any substantial part thereof.



     The foregoing restriction shall not apply to any sale-leaseback transaction if:




     (i) the lease is for a period, including renewal rights, of not in excess of three
years;




     (ii) the lease secures or relates to industrial revenue or pollution control bonds;




     (iii) the transaction is solely between FelCor LP or FelCor and any Wholly Owned
Restricted Subsidiary or solely between Wholly Owned Restricted Subsidiaries; or




     (iv) FelCor LP or FelCor or any of their respective Restricted Subsidiaries, within 12
months after the sale or transfer of any assets or properties is completed, applies an
amount not less than the net proceeds received from such sale in accordance with clause
(i)(A) or (B) of the second paragraph of Section 4.10.



     SECTION 4.20. Maintenance of Total Unencumbered Assets. FelCor LP, FelCor and their
respective Restricted Subsidiaries shall maintain Total Unencumbered Assets of not less than 150%
of the aggregate outstanding



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principal amount of the Unsecured Indebtedness of FelCor LP, FelCor and their
respective Restricted Subsidiaries on a consolidated basis.



     SECTION 4.21. Investment Grade Rating. Notwithstanding anything to the contrary in this
Indenture, Sections 4.04, 4.05, 4.06, 4.07, 4.08, 4.09 and 4.19 and clauses (iii) and (iv) of
Section 5.01 shall not be applicable in the event, and only for so long as, the Notes are rated
Investment Grade and no Default or Event of Default has occurred and is continuing.



ARTICLE V




SUCCESSOR CORPORATION




     SECTION 5.01. Consolidation, Merger and Sale of Assets. Neither FelCor LP nor FelCor will
merge with or into, or sell, convey, transfer, lease or otherwise dispose of all or substantially
all of its property and assets (as an entirety or substantially an entirety in one transaction or a
series of related transactions) to, any Person or permit any Person to merge with or into FelCor LP
or FelCor unless:




     (i) FelCor LP or FelCor shall be the continuing Person, or the Person (if other than
FelCor LP or FelCor) formed by such consolidation or into which FelCor LP or FelCor is
merged or that acquired or leased such property and assets of FelCor LP or FelCor shall be
an entity organized and validly existing under the laws of the United States of America or
any state or jurisdiction thereof and shall expressly assume, by a supplemental indenture,
executed and delivered to the Trustee, all of the obligations of FelCor LP or FelCor on the
Notes and under this Indenture;




     (ii) immediately after giving effect to such transaction, no Default or Event of
Default shall have occurred and be continuing;




     (iii) immediately after giving effect to such transaction on a pro forma basis FelCor
LP or FelCor, or any Person becoming the successor obligor of the Notes, as the case may be,
could Incur at least $1.00 of Indebtedness under paragraphs (a), (b) and (c) of Section
4.03; provided that this clause (iii) shall not apply to a consolidation or merger among
Wholly Owned Restricted Subsidiaries, of FelCor or FelCor LP with or into one or more Wholly
Owned Restricted Subsidiaries or of one or more Wholly Owned Restricted Subsidiaries with or
into FelCor or FelCor LP; provided that, in connection with any such merger or
consolidation, no consideration (other than Capital Stock (other than Disqualified Stock) in
the surviving Person or FelCor LP or FelCor) shall be issued or distributed to the holders
of Capital Stock of FelCor LP or FelCor; and




     (iv) FelCor LP or FelCor delivers to the Trustee an Officers’ Certificate (attaching
the arithmetic computations to demonstrate compliance with clause (iii)) and an Opinion of
Counsel, in each case stating that such consolidation, merger or transfer and such
supplemental indenture complies with this Section 5.01 and that all conditions precedent
provided for herein relating to such transaction have been complied with; provided that
clause (iii) above shall not apply if, in the good faith determination of the Board of
Directors of FelCor LP or FelCor, whose determination shall be evidenced by a Board
Resolution, the principal purpose of such transaction is to change the state of domicile of
FelCor LP or FelCor; and provided, further, that any such transaction shall not have as one
of its purposes the evasion of the foregoing limitations.



     SECTION 5.02. Successor Substituted. Upon any consolidation or merger, or any sale,
conveyance, transfer, lease or other disposition of all or substantially all of the property and
assets of FelCor LP in accordance with Section 5.01 of this Indenture, the successor Person
formed by such consolidation or into which FelCor LP is merged or to which such sale, conveyance,
transfer, lease or other disposition is made shall succeed to, and be substituted for, and may
exercise every right and power of, FelCor LP under this Indenture with the same effect as if such
successor Person had been named as FelCor LP herein and thereafter the predecessor corporation
shall be relieved of all obligations and covenants under this Indenture and the Notes; provided
that FelCor LP shall not be released from its obligation to pay the principal of, premium, if any,
or interest on the Notes in the case of a lease of all or substantially all of its property and
assets.



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ARTICLE VI




DEFAULT AND REMEDIES




     SECTION 6.01. Events of Default. An “Event of Default” shall occur with respect to this
Indenture if:




     (a) default in the payment of principal of, or premium, if any, on any Note when the
same becomes due and payable at maturity, upon acceleration, redemption or otherwise;




     (b) default in the payment of interest on any Note when the same becomes due and
payable, and such default continues for a period of 30 days;




     (c) default in the performance or breach of the provisions of this Indenture applicable
to mergers, consolidations and transfers of all or substantially all of the assets of FelCor
LP and FelCor or the failure by FelCor LP to make or consummate an Offer to Purchase in
accordance with Section 4.10 or Section 4.11;




     (d) FelCor LP or FelCor defaults in the performance of or breaches any other covenant
or agreement of FelCor LP or FelCor in this Indenture or under the Notes (other than a
default specified in clause (a), (b) or (c) above) and such default or breach continues for
a period of 60 consecutive days after written notice by the Trustee or the Holders of 25% or
more in aggregate principal amount of the Notes;




     (e) there occurs with respect to any issue or issues of Indebtedness of FelCor LP or
FelCor or any Significant Subsidiary having an outstanding principal amount of $10 million
or more in the aggregate for all such issues of all such Persons, whether such Indebtedness
now exists or shall hereafter be created,




     (i) an event of default that has caused the holder thereof to declare such
Indebtedness to be due and payable prior to its Stated Maturity and such
Indebtedness has not been discharged in full or such acceleration has not been
rescinded or annulled within 30 days of such acceleration and/or




     (ii) the failure to make a principal payment at the final (but not any interim)
fixed maturity and such defaulted payment shall not have been made, waived or
extended within 30 days of such payment default;




     (f) any final judgment or order (not covered by insurance) for the payment of money in
excess of $10 million in the aggregate for all such final judgments or orders against all
such Persons (treating any deductibles, self-insurance or retention as not covered by
insurance):




     (i) shall be rendered against FelCor LP or FelCor or any Significant Subsidiary
and shall not be paid or discharged, and




     (ii) there shall be any period of 60 consecutive days following entry of the
final judgment or order that causes the aggregate amount for all such final
judgments or orders outstanding and not paid or discharged against all such Persons
to exceed $10 million during which a stay of enforcement of such final judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect;




     (g) a court having jurisdiction in the premises enters a decree or order for:




     (i) relief in respect of FelCor LP or FelCor or any Significant Subsidiary in
an involuntary case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect,



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     (ii) appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of FelCor LP or FelCor or any Significant
Subsidiary or for all or substantially all of the property and assets of FelCor LP
or FelCor or any Significant Subsidiary, or




     (iii) the winding up or liquidation of the affairs of FelCor LP or FelCor or
any Significant Subsidiary and, in each case, such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days;




     (h) FelCor LP or FelCor or any Significant Subsidiary:




     (i) commences a voluntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or consents to the entry of an order
for relief in an involuntary case under such law,




     (ii) consents to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official of FelCor
LP or FelCor or Significant Subsidiary or for all or substantially all of the
property and assets of FelCor LP or FelCor or any Significant Subsidiary, or




     (iii) effects any general assignment for the benefit of its creditors;




     (i) any Note Guarantee ceases to be in full force and effect (other than in accordance
with the terms of such Note Guarantee and this Indenture) or any Guarantor notifies the
Trustee in writing that it denies or disaffirms its obligations under its Note Guarantee; or




     (j) the repudiation by FelCor LP or FelCor of any of its obligations under any
Collateral Document or the unenforceability of any Collateral Document against FelCor LP or
FelCor if such unenforceability reasonably would be expected to result in a material adverse
effect on the Liens granted pursuant to such Collateral Documents.



     SECTION 6.02. Acceleration. If an Event of Default (other than an Event of Default specified
in clause (g) or (h) of Section 6.01 that occurs with respect to FelCor LP or FelCor) occurs and is
continuing under this Indenture, the Trustee or the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding, by written notice to FelCor LP and FelCor (and to the Trustee
if such notice is given by the Holders), may, and the Trustee at the request of such Holders shall,
declare the principal of, premium, if any, and accrued interest on the Notes to be immediately due
and payable. Upon a declaration of acceleration, such principal of, premium, if any, and accrued
interest shall be immediately due and payable. In the event of a declaration of acceleration
because an Event of Default set forth in clause (e) of Section 6.01 has occurred and is continuing,
such declaration of acceleration shall be automatically rescinded and annulled if the event of
default triggering such Event of Default pursuant to such clause (e) shall be remedied or cured by
FelCor LP, FelCor or the relevant Significant Subsidiary or waived by the holders of the relevant
Indebtedness within 60 days after the declaration of acceleration with respect thereto.



     If an Event or Default specified in clause (g) or (h) of Section 6.01 occurs with respect to
FelCor LP or FelCor, the principal of, premium, if any, and accrued interest on the Notes then
outstanding shall automatically become and be immediately due and payable without any declaration
or other act on the part of the Trustee or any Holder. The Holders of at least a majority in
principal amount of the outstanding Notes by written notice to FelCor LP, FelCor and to the
Trustee, may waive all past defaults and rescind and annul a declaration of acceleration and its
consequences if:




     (i) all existing Events of Default, other than the nonpayment of the principal of,
premium, if any, and interest on the Notes that have become due solely by such declaration
of acceleration, have been cured or waived and




     (ii) the rescission would not conflict with any judgment or decree of a court of
competent jurisdiction.



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     SECTION 6.03. Other Remedies. If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity to collect the payment of
principal of, premium, if any, or interest on the Notes or to enforce the performance of any
provision of the Notes, this Indenture or the Collateral Documents.



     The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not
produce any of them in the proceeding.



     SECTION 6.04. Waiver of Past Defaults. Subject to Sections 6.02, 6.07 and 9.02, the Holders
of at least a majority in principal amount of the outstanding Notes, by notice to the Trustee, may
waive an existing Default or Event of Default and its consequences, except a Default in the payment
of principal of, premium, if any, or interest on any Note as specified in clause (a) or (b) of
Section 6.01 or in respect of a covenant or provision of this Indenture which cannot be modified or
amended without the consent of the Holder of each outstanding Note affected. Upon any such waiver,
such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent thereto.



     SECTION 6.05. Control by Majority. The Holders of at least a majority in aggregate principal
amount at maturity of the outstanding Notes may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or power conferred on
the Trustee. However, the Trustee may refuse to follow any direction that conflicts with law or
this Indenture, that may involve the Trustee in personal liability, or that the Trustee determines
in good faith may be unduly prejudicial to the rights of Holders of Notes not joining in the giving
of such direction and may take any other action it deems proper that is not inconsistent with any
such direction received from Holders of Notes.



     SECTION 6.06. Limitation on Suits. A Holder may not institute any proceeding, judicial or
otherwise, with respect to this Indenture or the Notes, or for the appointment of a receiver or
trustee, or for any other remedy hereunder unless:




     (1) such Holder has previously given the Trustee written notice of a continuing Event
of Default;




     (2) the Holders of at least 25% in aggregate principal amount at maturity of
outstanding Notes shall have made a written request to the Trustee to institute proceedings
in respect of such Event of Default in its own name as Trustee hereunder;




     (3) such Holder or Holders have offered the Trustee indemnity reasonably satisfactory
to the Trustee against any costs, liabilities or expenses to be incurred in compliance with
such request;




     (4) the Trustee does not comply with the request within 60 days after receipt of the
request and the offer of indemnity and has failed to institute any such proceedings; and




     (5) during such 60-day period, the Holders of a majority in aggregate principal amount
at maturity of the outstanding Notes do not give the Trustee a direction that is
inconsistent with such written request.




     (6) For purposes of Section 6.05 and this Section 6.06, the Trustee shall comply with
TIA Section 316(a) in making any determination of whether the Holders of the required
aggregate principal amount of outstanding Notes have concurred in any request or direction
of the Trustee to pursue any remedy available to the Trustee or the Holders with respect to
this Indenture or the Notes or otherwise under the law.



     A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a
preference or priority over such other Holder.



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     SECTION 6.07. Rights of Holders To Receive Payment. Notwithstanding any other provision of
this Indenture, the right of any Holder of a Note to receive payment of the principal of, premium,
if any, or interest on, such Note or to bring suit for the enforcement of any such payment on or
after the due date expressed in the Notes, shall not be impaired or affected without the consent of
such Holder.



     SECTION 6.08. Collection Suit by Trustee. If an Event of Default in payment of principal,
premium or interest specified in clause (a), (b) or (c) of Section 6.01 occurs and is continuing,
the Trustee may recover judgment in its own name and as trustee of an express trust against FelCor
LP, the Guarantors or any other obligor of the Notes for the whole amount of principal, premium, if
any, and accrued interest remaining unpaid, together with interest on overdue principal, premium,
if any, and, to the extent that payment of such interest is lawful, interest on overdue
installments of interest, in each case at the rate specified in the Notes, and such further amount
as shall be sufficient to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.



     SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file such proofs of claim and
other papers or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07)
and the Holders allowed in any judicial proceedings relative to FelCor LP (or any other obligor of
the Notes), its creditors or its property and shall be entitled and empowered to collect and
receive any monies, securities or other property payable or deliverable upon conversion or exchange
of the Notes or upon any such claims and to distribute the same, and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the
event that the Trustee shall consent to the making of such payments directly to the Holders, to pay
to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agent and counsel, and any other amounts due the Trustee under Section
7.07. Nothing herein contained shall be deemed to empower the Trustee to authorize or consent to,
or accept or adopt on behalf of any Holder, any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.



     SECTION 6.10. Priorities. If the Trustee collects any money pursuant to this Article Six, it
shall pay out the money in the following order:




     First: to the Trustee for all amounts due under Section 7.07;




     Second: to Holders for amounts then due and unpaid for principal of, premium, if any,
and interest on the Notes in respect of which or for the benefit of which such money has
been collected, ratably, without preference or priority of any kind, according to the
amounts due and payable on such Notes for principal, premium, if any, and interest,
respectively; and




     Third: to FelCor LP or any other obligors of the Notes, as their interests may appear,
or as a court of competent jurisdiction may direct.



     The Trustee, upon prior written notice to FelCor LP, may fix a record date and payment date
for any payment to Holders pursuant to this Section 6.10.



     SECTION 6.11. Undertaking for Costs. In any suit for the enforcement of any right or remedy
under this Indenture or in any suit against the Trustee for any action taken or omitted by it as
Trustee, a court may require any party litigant in such suit to file an undertaking to pay the
costs of the suit, and the court may assess reasonable costs, including reasonable attorneys’ fees,
against any party litigant in the suit having due regard to the merits and good faith of the claims
or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee,
a suit by a Holder pursuant to Section 6.07 of this Indenture, or a suit by Holders of more than
10% in principal amount of the outstanding Notes.



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     SECTION 6.12. Restoration of Rights and Remedies. If the Trustee or any Holder has instituted
any proceeding to enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then, and in every such case, subject to any determination in such proceeding, FelCor
LP, the Trustee and the Holders shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of FelCor LP, the Guarantors, Trustee
and the Holders shall continue as though no such proceeding had been instituted.



     SECTION 6.13. Rights and Remedies Cumulative. Except as otherwise provided with respect to
the replacement or payment of mutilated, destroyed, lost or wrongfully taken Notes in Section 2.09,
no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended
to be exclusive of any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment
of any other appropriate right or remedy.



     SECTION 6.14. Delay or Omission Not Waiver. No delay or omission of the Trustee or of any
Holder to exercise any right or remedy accruing upon any Event of Default shall impair any such
right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article Six or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.



ARTICLE VII




TRUSTEE




     SECTION 7.01. General. The duties and responsibilities of the Trustee shall be as provided by
the TIA and as set forth herein. Notwithstanding the foregoing, no provision of this Indenture
shall require the Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to it. The Trustee
shall not be required to give any bond or surety with respect to the performance of its duties or
the exercise of its powers under this Indenture. Whether or not therein expressly so provided,
every provision of this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this Article Seven.



     SECTION 7.02. Certain Rights of Trustee. Subject to TIA Sections 315(a) through (d):




     (1) the Trustee may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to have
been signed or presented by the proper person. The Trustee need not investigate any
fact or matter stated in the document;




     (2) before the Trustee acts or refrains from acting, it may require an
Officers’ Certificate or an Opinion of Counsel, which shall conform to Section
10.04. The Trustee shall not be liable for any action it takes or omits to take in
good faith in reliance on such certificate or opinion;




     (3) the Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due care;




     (4) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture at the request or direction of any of the
Holders, unless such Holders shall have offered to the Trustee reasonable security
or indemnity against the costs, expenses and liabilities that might be incurred by
it in compliance with such request or direction;



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     (5) the Trustee shall not be liable for any action it takes or omits to take in
good faith that it believes to be authorized or within its rights or powers or for
any action it takes or omits to take in accordance with the direction of the Holders
of a majority in principal amount at maturity of the outstanding Notes relating to
the time, method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred upon the Trustee, under this
Indenture; provided that the Trustee’s conduct does not constitute gross negligence
or bad faith;




     (6) whenever in the administration of this Indenture the Trustee shall deem it
desirable that a making be proved or established prior to taking, suffering or
omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely upon an
Officer’s Certificate; and




     (7) the Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled to examine the books, records and
premises of FelCor LP personally or by agent or attorney.




     (8) The Trustee shall not be deemed to have notice, or charged with having
knowledge, of an Event of Default except (i) any Default or Event of Default
occurring pursuant to Sections 6.01(a) and 6.01(b) or (ii) any Default or Event of
Default of which a Responsible Officer of the Trustee shall have received written
notification at the Corporate Trust Office referencing the Notes and this Indenture
or obtained actual knowledge.



     SECTION 7.03. Individual Rights of Trustee. The Trustee, in its individual or any other
capacity, may become the owner or pledgee of Notes and may otherwise deal with FelCor LP, the
Guarantors, or their Affiliates with the same rights it would have if it were not the Trustee. Any
Agent may do the same with like rights. However, the Trustee is subject to TIA Sections 310(b) and
311.



     SECTION 7.04. Trustee’s Disclaimer. The Trustee (i) makes no representation as to the
validity or adequacy of this Indenture or the Notes, (ii) shall not be accountable for FelCor LP’s
use or application of the proceeds from the Notes, (iii) shall not be responsible for any statement
in the Notes other than its certificate of authentication and (iv) shall have no responsibility for
any information or statements contained in any offering or other disclosure documents prepared in
connection with the offering and the sale of the Notes other than the information provided by the
Trustee to FelCor or FelCor LP.



     SECTION 7.05. Notice of Default. If any Default or any Event of Default occurs and is
continuing and if such Default or Event of Default is known to a Responsible Officer of the
Trustee, the Trustee shall mail to each Holder in the manner and to the extent provided in TIA
Section 313(c) notice of the Default or Event of Default within 45 days after it occurs, unless
such Default or Event of Default has been cured; provided, however, that, except in the case of a
default in the payment of the principal of, premium, if any, or interest on any Note, the Trustee
shall be protected in withholding such notice if and so long as the board of directors, the
executive committee or a trust committee of directors and/or Responsible Officers of the Trustee in
good faith determine that the withholding of such notice is in the interest of the Holders.



     SECTION 7.06. Reports by Trustee to Holders. Within 60 days after each May 15, beginning with
May 15, 2007, the Trustee shall mail to each Holder as provided in TIA Section 313(c) a brief
report dated as of such May 15 but only if required by TIA Section 313(a).



     SECTION 7.07. Compensation and Indemnity. FelCor LP shall pay to the Trustee such
compensation as shall be agreed upon in writing for its services. The compensation of the Trustee
shall not be limited by any law on compensation of a trustee of an express trust. FelCor LP shall
reimburse the Trustee upon request for all reasonable



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out-of-pocket expenses and advances incurred or made by the Trustee. Such expenses shall
include the reasonable compensation and expenses of the Trustee’s agents and counsel.



     FelCor LP shall indemnify the Trustee and its officers, directors, employees and agents and
save Trustee and its officers, directors, employees and agents harmless from and against any and
all Claims (as hereinafter defined) and Losses (as hereinafter defined) which may be incurred by
Trustee or any of such officers, directors, employees or agents as a result of Claims asserted
against Trustee or any of such officers, directors, employees or agents as a result of or in
connection with Trustee’s capacity as such under this Indenture by any person or entity. For the
purposes hereof, the term “Claims” shall mean all claims, lawsuits, causes of action or other legal
actions and proceedings of whatever nature brought against (whether by way of direct action,
counterclaim, cross action or impleader) Trustee or any such officer, director, employee or agent,
even if groundless, false or fraudulent, so long as the claim, lawsuit, cause of action or other
legal action or proceeding is alleged or determined, directly or indirectly, to arise out of,
result from, relate to or be based upon, in whole or in part: (a) the acts or omissions of FelCor
LP or any Guarantor, (b) the appointment of Trustee as trustee under this Indenture, or (c) the
performance by Trustee of its powers and duties under this Indenture; and the term “Losses” shall
mean losses, costs, damages, expenses, judgments and liabilities of whatever nature (including but
not limited to attorneys’, accountants’ and other professionals’ fees, litigation and court costs
and expenses and amounts paid in settlement), directly or indirectly resulting from, arising out of
or relating to one or more Claims. Upon the written request of Trustee or any such officer,
director, employee or agent (each referred to hereinafter as an “Indemnified Party”), FelCor LP
shall assume the investigation and defense of any Claim, including the employment of counsel
acceptable to the applicable Indemnified Party and the payment of all expenses related thereto and
notwithstanding any such assumption, the Indemnified Party shall have the right, and FelCor LP
shall pay the cost and expense thereof, to employ separate counsel with respect to any such Claim
and participate in the investigation and defense thereof in the event that such Indemnified Party
shall have been advised by counsel that there may be one or more legal defenses available to such
Indemnified Party which are different from or additional to those available to FelCor LP. FelCor
LP hereby agrees that the indemnifications and protections afforded Trustee in this section shall
survive the termination of this Indenture. Notwithstanding the foregoing, no indemnification shall
be available hereunder to the extent that a court of competent jurisdiction determines in a
non-appealable order that the Loss or Claim for which such indemnification is sought was directly
caused by the negligence or bad faith of the Indemnified Party.



     To secure FelCor LP’s payment obligations in this Section 7.07, the Trustee shall have a lien
prior to the Notes on all money or property held or collected by the Trustee, in its capacity as
Trustee, except money or property held in trust to pay principal of, premium, if any, and interest
on particular Notes.



     If the Trustee incurs expenses or renders services after the occurrence of an Event of
Default specified in clause (g) or (h) of Section 6.01, the expenses and the compensation for the
services will be intended to constitute expenses of administration under Title 11 of the United
States Bankruptcy Code or any applicable federal or state law for the relief of debtors.



     The provisions of this Section shall survive the termination of this Indenture.



     SECTION 7.08. Replacement of Trustee. A resignation or removal of the Trustee and appointment
of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of
appointment as provided in this Section 7.08.



     The Trustee may resign at any time by so notifying FelCor LP in writing at least 30 days prior
to the date of the proposed resignation. The Holders of a majority in principal amount of the
outstanding Notes may remove the Trustee by so notifying the Trustee in writing and may appoint a
successor Trustee with the consent of FelCor LP. FelCor LP may at any time remove the Trustee, by
Company Order given at least 30 days prior to the date of the proposed removal.



     If the Trustee resigns or is removed, or if a vacancy exists in the office of Trustee for any
reason, FelCor LP shall promptly appoint a successor Trustee. Within one year after the successor
Trustee takes office, the Holders of a majority in principal amount of the outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by FelCor LP. If the
successor Trustee does not deliver its written acceptance required by the



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next succeeding paragraph of this Section 7.08 within 30 days after notice is given by FelCor
LP or the Trustee, as the case may be, of such resignation or removal, the retiring Trustee, FelCor
LP or the Holders of a majority in principal amount of the outstanding Notes may petition any court
of competent jurisdiction for the appointment of a successor Trustee.



     A successor Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to FelCor LP. Immediately after the delivery of such written acceptance, subject to
the lien provided in Section 7.07, (i) the retiring Trustee shall transfer all property held by it
as Trustee to the successor Trustee, (ii) the resignation or removal of the retiring Trustee shall
become effective and (iii) the successor Trustee shall have all the rights, powers and duties of
the Trustee under this Indenture. A successor Trustee shall mail notice of its succession to each
Holder.



     If the Trustee is no longer eligible under Section 7.10, any Holder who satisfies the
requirements of TIA Section 310(b) may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.



     FelCor LP shall give notice of any resignation and any removal of the Trustee and each
appointment of a successor Trustee to all Holders. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.



     Notwithstanding replacement of the Trustee pursuant to this Section 7.08, FelCor LP’s
obligation under Section 7.07 shall continue for the benefit of the retiring Trustee.



     SECTION 7.09. Successor Trustee by Merger, Etc. If the Trustee consolidates with, merges or
converts into, or transfers all or substantially all of its corporate trust business to, another
corporation or national banking association, the resulting, surviving or transferee corporation or
national banking association without any further act shall be the successor Trustee with the same
effect as if the successor Trustee had been named as the Trustee herein.



     SECTION 7.10. Eligibility. This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1). The Trustee shall have a combined capital and surplus of at
least $25,000,000 as set forth in its most recent filed annual report of condition.



     SECTION 7.11. Money Held in Trust. The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree with FelCor LP. Money held in trust by the Trustee
need not be segregated from other funds except to the extent required by law and except for money
held in trust under Article Eight of this Indenture.



     SECTION 7.12. Withholding Taxes. The Trustee, as agent for FelCor LP, shall exclude and
withhold from each payment of principal and interest and other amounts due hereunder or under the
Notes any and all withholding taxes applicable thereto as required by law. The Trustee agrees to
act as such withholding agent and, in connection therewith, whenever any present or future taxes or
similar charges are required to be withheld with respect to any amounts payable in respect of the
Notes, to withhold such amounts and timely pay the same to the appropriate authority in the name of
and on behalf of the Holders of the Notes, that it will file any necessary withholding tax returns
or statements when due. FelCor LP or the Trustee shall, as promptly as possible after the payment
of the taxes described above, deliver to each Holder of a Note appropriate documentation showing
the payment thereof, together with such additional documentary evidence as such Holders may
reasonably request from time to time.



ARTICLE VIII




DISCHARGE OF INDENTURE




     SECTION 8.01. Termination of Company’s Obligations. Except as otherwise provided in this
Section 8.01, FelCor LP may terminate its obligations under the Notes and this Indenture if:



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     (1) all Notes previously authenticated and delivered (other than destroyed,
lost or stolen Notes that have been replaced or Notes that are paid pursuant to
Section 4.01 or Notes for whose payment money or securities have theretofore been
held in trust and thereafter repaid to FelCor LP, as provided in Section 8.05) have
been delivered to the Trustee for cancellation and FelCor LP has paid all sums
payable by it hereunder; or




     (2) (A) the Notes mature within one year or all of them are to be called for
redemption within one year under arrangements satisfactory to the Trustee for giving
the notice of redemption, (B) FelCor LP irrevocably deposits in trust with the
Trustee during such one-year period, under the terms of an irrevocable trust
agreement in form and substance satisfactory to the Trustee, as trust funds solely
for the benefit of the Holders for that purpose, money or U.S. Government
Obligations sufficient (in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee), without consideration of any reinvestment of any interest
thereon, to pay principal, premium, if, any, and interest on the Notes to maturity
or redemption, as the case may be, and to pay all other sums payable by it
hereunder, (C) no Default or Event of Default with respect to the Notes shall have
occurred and be continuing on the date of such deposit, (D) such deposit will not
result in a breach or violation of, or constitute a default under, this Indenture or
any other agreement or instrument to which FelCor or FelCor LP is a party or by
which they are bound and (E) FelCor and FelCor LP have delivered to the Trustee an
Officers’ Certificate and an Opinion of Counsel, in each case stating that all
conditions precedent provided for herein relating to the satisfaction and discharge
of this Indenture have been complied with.



     With respect to the foregoing clause (i), FelCor LP’s obligations under Section 7.07 shall
survive. With respect to the foregoing clause (ii), FelCor LP’s obligations in Sections 2.02,
2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 2.14, 4.01, 4.02, 7.07, 7.08, 8.04, 8.05 and 8.06 shall
survive until the Notes are no longer outstanding. Thereafter, only FelCor LP’s obligations in
Sections 7.07, 8.05 and 8.06 shall survive. After any such irrevocable deposit, the Trustee upon
request shall acknowledge in writing the discharge of FelCor LP’s obligations under the Notes and
this Indenture except for those surviving obligations specified above.



     SECTION 8.02. Defeasance and Discharge of Indenture. FelCor LP and the Guarantors will be
deemed to have paid and will be discharged from any and all obligations in respect of the Notes or
any Guarantee pursuant to Article 11 on the 123rd day after the date of the deposit referred to in
clause (A) of this Section 8.02, and the provisions of this Indenture will no longer be in effect
with respect to the Notes, and the Trustee, at the expense of FelCor LP, shall execute proper
instruments acknowledging the same; provided that the following conditions shall have been
satisfied:




     (A) with reference to this Section 8.02, FelCor LP has deposited or caused to
be deposited with the Trustee (or another trustee satisfying the requirements of
Section 7.10 of this Indenture) and conveyed all right, title and interest for the
benefit of the Holders, under the terms of a trust agreement in form and substance
satisfactory to the Trustee as trust funds in trust, specifically pledged to the
Trustee for the benefit of the Holders as security for payment of the principal of,
premium, if any, and interest, if any, on the Notes, and dedicated solely to, the
benefit of the Holders, in and to (1) money in an amount, (2) U.S. Government
Obligations that, through the payment of interest, premium, if any, and principal in
respect thereof in accordance with their terms, will provide, not later than one day
before the due date of any payment referred to in this clause (A), money in an
amount or (3) a combination thereof in an amount sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge, without
consideration of the reinvestment of such interest and after payment of all federal,
state and local taxes or other charges and assessments in respect thereof payable by
the Trustee, the principal of, premium, if any, and accrued interest on the
outstanding Notes at the Stated Maturity of such principal or interest; provided
that the Trustee shall have been irrevocably instructed to apply such money or the
proceeds of such U.S. Government Obligations to the payment of such principal,
premium, if any, and interest with respect to the Notes;



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     (B) such deposit will not result in a breach or violation of, or constitute a
default under, this Indenture or any other agreement or instrument to which FelCor
LP, FelCor or any of their respective Restricted Subsidiaries is a party or by which
FelCor LP, FelCor or any of their respective Restricted Subsidiaries is a party or
by which FelCor LP is bound;




     (C) immediately after giving effect to such deposit on a pro forma basis, no
Default or Event of Default shall have occurred and be continuing on the date of
such deposit or during the period ending on the 123rd day after such date of
deposit;




     (D) FelCor LP shall have delivered to the Trustee (1) either (x) a ruling
directed to the Trustee received from the Internal Revenue Service to the effect
that the Holders will not recognize income, gain or loss for federal income tax
purposes as a result of FelCor LP’s exercise of its option under this Section 8.02
and will be subject to federal income tax on the same amount and in the same manner
and at the same times as would have been the case if such option had not been
exercised or (y) an Opinion of Counsel to the same effect as the ruling described in
clause (x) above accompanied by a ruling to that effect published by the Internal
Revenue Service, unless there has been a change in the applicable federal income tax
law since the date of this Indenture such that a ruling from the Internal Revenue
Service is no longer required and (2) an Opinion of Counsel to the effect that (x)
the creation of the defeasance trust does not violate the Investment Company Act of
1940 and (y) after the passage of 123 days following the deposit (except, with
respect to any trust funds for the account of any Holder who may be deemed to be an
“insider” for purposes of the United States Bankruptcy Code, after one year
following the deposit), the trust funds will not be subject to the effect of Section
547 of the United States Bankruptcy Code or Section 15 of the New York Debtor and
Creditor Law in a case commenced by or against FelCor LP or a Guarantor under either
such statute, and either (I) the trust funds will no longer remain the property of
FelCor LP or a Guarantor (and therefore will not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally) or (II) if a court were to rule under any such law in
any case or proceeding that the trust funds remained property of FelCor LP or a
Guarantor, (a) assuming such trust funds remained in the possession of the Trustee
prior to such court ruling to the extent not paid to the Holders, the Trustee will
hold, for the benefit of the Holders, a valid and perfected security interest in
such trust funds that is not avoidable in bankruptcy or otherwise except for the
effect of Section 552(b) of the United States Bankruptcy Code on interest on the
trust funds accruing after the commencement of a case under such statute and (b) the
Holders will be entitled to receive adequate protection of their interests in such
trust funds if such trust funds are used in such case or proceeding;




     (E) if the Notes are then listed on a national securities exchange, FelCor LP
shall have delivered to the Trustee an Opinion of Counsel to the effect that such
deposit defeasance and discharge will not cause the Notes to be delisted; and




     (F) FelCor LP has delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, in each case stating that all conditions precedent provided for
herein relating to the defeasance contemplated by this Section 8.02 have been
complied with.



     Notwithstanding the foregoing, prior to the end of the 123-day (or one year) period referred
to in clause (D)(2)(y) of this Section 8.02, none of FelCor LP’s obligations under this Indenture
shall be discharged. Subsequent to the end of such 123-day (or one year) period with respect to
this Section 8.02, FelCor LP’s obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.08,
2.09, 2.14, 4.01, 4.02, 7.07, 7.08, 8.05 and 8.06 shall survive until the Notes are no longer
outstanding. Thereafter, only FelCor LP’s obligations in Sections 7.07, 8.05 and 8.06 shall
survive. If and when a ruling from the Internal Revenue Service or an Opinion of Counsel referred
to in clause (D)(1) of this Section 8.02 is able to be provided specifically without regard to, and
not in reliance upon, the continuance of FelCor LP’s obligations under Section 4.01, then FelCor
LP’s obligations under such Section 4.01 shall cease upon delivery to the Trustee of such ruling or
Opinion of Counsel and compliance with the other conditions precedent provided for herein relating
to the defeasance contemplated by this Section 8.02.



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     After any such irrevocable deposit, the Trustee upon request shall acknowledge in writing the
discharge of FelCor LP’s obligations under the Notes and this Indenture except for those surviving
obligations in the immediately preceding paragraph.



     SECTION 8.03. Defeasance of Certain Obligations. FelCor LP may omit to comply with any term,
provision or condition set forth in clause (iii) or (iv) under Section 5.01 and Sections 4.03
through 4.17 and Sections 4.19 and 4.20, clauses (c) and (d) under Section 6.01 with respect to
such clause (iii) or (iv) under Section 5.01 and Sections 4.03 through 4.17 and Sections 4.19 and
4.20 and Article Twelve, and clauses (e), (f) and (g) under Section 6.01 shall be deemed not to be
Events of Default, in each case with respect to the outstanding Notes if:




     (i) with reference to this Section 8.03, FelCor LP has irrevocably deposited or caused
to be irrevocably deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.10) and conveyed all right, title and interest to the Trustee for the benefit
of the Holders, under the terms of an irrevocable trust agreement in form and substance
satisfactory to the Trustee as trust funds in trust, specifically pledged to the Trustee for
the benefit of the Holders as security for payment of the principal of, premium, if any, and
interest, if any, on the Notes, and dedicated solely to, the benefit of the Holders, in and
to (A) money in an amount, (B) U.S. Government Obligations that, through the payment of
interest and principal in respect thereof in accordance with their terms, will provide, not
later than one day before the due date of any payment referred to in this clause (i), money
in an amount or (C) a combination thereof in an amount sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge, without consideration
of the reinvestment of such interest and after payment of all federal, state and local taxes
or other charges and assessments in respect thereof payable by the Trustee, the principal
of, premium, if any, and interest on the outstanding Notes on the Stated Maturity of such
principal or interest; provided that the Trustee shall have been irrevocably instructed to
apply such money or the proceeds of such U.S. Government Obligations to the payment of such
principal, premium, if any, and interest with respect to the Notes;




     (ii) such deposit will not result in a breach or violation of, or constitute a default
under, this Indenture or any other agreement or instrument to which FelCor LP, FelCor or any
of their Restricted Subsidiaries is a party or by which FelCor LP, FelCor or any of their
Restricted Subsidiaries is bound;




     (iii) no Default or Event of Default shall have occurred and be continuing on the date
of such deposit;




     (iv) FelCor LP has delivered to the Trustee an Opinion of Counsel to the effect that
(A) the creation of the defeasance trust does not violate the Investment Company Act of
1940, (B) the Holders have a valid first-priority security interest in the trust funds, (C)
the Holders will not recognize income, gain or loss for federal income tax purposes as a
result of such deposit and defeasance of certain obligations and will be subject to federal
income tax on the same amount and in the same manner and at the same times as would have
been the case if such deposit and defeasance had not occurred and (D) after the passage of
123 days following the deposit (except, with respect to any trust funds for the account of
any Holder who may be deemed to be an “insider” for purposes of the United States Bankruptcy
Code, after one year following the deposit), the trust funds will not be subject to the
effect of Section 547 of the United States Bankruptcy Code or Section 15 of the New York
Debtor and Creditor Law in a case commenced by or against FelCor LP under either such
statute, and either (1) the trust funds will no longer remain the property of FelCor LP or a
Guarantor (and therefore will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors’ rights generally) or (2) if
a court were to rule under any such law in any case or proceeding that the trust funds
remained property of FelCor LP or a Guarantor, (x) assuming such trust funds remained in the
possession of the Trustee prior to such court ruling to the extent not paid to the Holders,
the Trustee will hold, for the benefit of the Holders, a valid and perfected security
interest in such trust funds that is not avoidable in bankruptcy or otherwise (except for
the effect of Section 552(b) of the United States Bankruptcy Code on interest on the trust
funds accruing after the commencement of a case under such statute), (y) the Holders will be
entitled to receive adequate protection of their interests in such trust funds if such trust
funds are used in such case or proceeding and (z) no property, rights in property or other
interests granted to the Trustee or the Holders in exchange for, or with respect to, such



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trust funds will be subject to any prior rights of holders of other Indebtedness of
FelCor LP, FelCor or any of their Subsidiaries;




     (v) if the Notes are then listed on a national securities exchange, FelCor LP shall
have delivered to the Trustee an Opinion of Counsel to the effect that such deposit
defeasance and discharge will not cause the Notes to be delisted; and




     (vi) FelCor LP has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, in each case stating that all conditions precedent provided for herein relating to
the defeasance contemplated by this Section 8.03 have been complied with.



     SECTION 8.04. Application of Trust Money. Subject to Section 8.06, the Trustee or Paying
Agent shall hold in trust money or U.S. Government Obligations deposited with it pursuant to
Section 8.01, 8.02 or 8.03, as the case may be, and shall apply the deposited money and the money
from U.S. Government Obligations in accordance with the Notes and this Indenture to the payment of
principal of, premium, if any, and interest on the Notes; but such money need not be segregated
from other funds except to the extent required by law.



     SECTION 8.05. Repayment to Company. Subject to Sections 7.07, 8.01, 8.02 and 8.03, the
Trustee and the Paying Agent shall promptly pay to FelCor LP upon request set forth in an Officers’
Certificate any excess money held by them at any time and thereupon shall be relieved from all
liability with respect to such money. The Trustee and the Paying Agent shall pay to FelCor LP upon
request any money held by them for the payment of principal, premium, if any, or interest that
remains unclaimed for two years; provided that the Trustee or such Paying Agent before being
required to make any payment may cause to be published at the expense of FelCor LP once in a
newspaper of general circulation in the City of New York or mail to each Holder entitled to such
money at such Holder’s address (as set forth in the Note Register) notice that such money remains
unclaimed and that after a date specified therein (which shall be at least 30 days from the date of
such publication or mailing) any unclaimed balance of such money then remaining will be repaid to
FelCor LP. After payment to FelCor LP, Holders entitled to such money must look to FelCor LP for
payment as general creditors unless an applicable law designates another Person, and all liability
of the Trustee and such Paying Agent with respect to such money shall cease.



     SECTION 8.06. Reinstatement. If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with Section 8.01, 8.02 or 8.03, as the case may be, by
reason of any legal proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, FelCor LP’s obligations
under this Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 8.01, 8.02 or 8.03, as the case may be, until such time as the Trustee
or Paying Agent is permitted to apply all such money or U.S. Government Obligations in accordance
with Section 8.01, 8.02 or 8.03, as the case may be; provided that, if FelCor LP has made any
payment of principal of, premium, if any, or interest on any Notes because of the reinstatement of
its obligations, FelCor LP shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money or U.S. Government Obligations held by the Trustee or Paying
Agent.



ARTICLE IX




AMENDMENTS, SUPPLEMENTS AND WAIVERS




     SECTION 9.01. Without Consent of Holders. FelCor, FelCor LP, the Pledgor (if applicable) and
the Subsidiary Guarantors when authorized by a resolution of their Board of Directors, and the
Trustee may amend or supplement this Indenture, the Notes or the Collateral Documents without
notice to or the consent of any Holder:




     (1) to cure any ambiguity, defect or inconsistency in this Indenture; provided
that such amendments or supplements shall not adversely affect the interests of the
Holders in any material respect;




     (2) to comply with Section 4.07 or Article Five;



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     (3) to comply with any requirements of the Commission in connection with the
qualification of this Indenture under the TIA;




     (4) to evidence and provide for the acceptance of appointment hereunder by a
successor Trustee;




     (5) to secure or Guarantee the Notes;




     (6) to make any change that, in the good faith opinion of the Board of
Directors as evidenced by a Board Resolution, does not materially and adversely
affect the rights of any Holder.; or




     (7) to add any Collateral to secure the Notes and to release any Collateral
pursuant to the terms hereof or the Collateral Documents.



     SECTION 9.02. With Consent of Holders. Subject to Sections 6.04 and 6.07 and without prior
notice to the Holders, FelCor, FelCor LP,the Pledgor (if applicable) and the Subsidiary Guarantors,
when authorized by their Board of Directors (as evidenced by a Board Resolution), and the Trustee
may amend this Indenture, the Notes and the Collateral Documents with the written consent of the
Holders of a majority in aggregate principal amount at maturity of the Notes then outstanding
(except that any amendment or supplement to Article Twelve or any other provision of the Indenture
relating to the Collateral shall require consents from Holders of not less than 66-2/3% of the
aggregate principal amount at maturity of the Notes then outstanding), and the Holders of a
majority in aggregate principal amount at maturity of the Notes then outstanding by written notice
to the Trustee may waive future compliance by FelCor, FelCor LP, or the Pledgor (if applicable)
with any provision of this Indenture or the Notes (except that any waiver of compliance with
Article Twelve or any other provision of the Indenture relating to the Collateral shall require
consents from Holders of not less than 66-2/3% of the aggregate principal amount at maturity of the
Notes then outstanding).



     Notwithstanding the provisions of this Section 9.02, without the consent of each Holder
affected, an amendment or waiver, including a waiver pursuant to Section 6.04, may not:




     (i) change the Stated Maturity of the principal of, or any installment of interest on,
any Note,




     (ii) reduce the principal amount of, or premium, if any, or interest on, any Note,




     (iii) change the place of payment of principal of, or premium, if any, or interest on,
any Note, or adversely affect any right of repayment at the option of any Holder of any
Note,




     (iv) impair the right to institute suit for the enforcement of any payment on or after
the Stated Maturity (or, in the case of a redemption, on or after the Redemption Date) of
any Note,




     (v) reduce the percentage of outstanding Notes, the consent of whose Holders is
necessary to modify or amend this Indenture,




     (vi) waive a Default in the payment of principal of, premium, if any, or interest on
the Notes,




     (vii) voluntarily release a Guarantor of the Notes,




     (viii) modify any of the provisions of this Section 9.02, except to increase any such
percentage or to provide that certain other provisions of this Indenture cannot be modified
or waived without the consent of the Holder of each outstanding Note affected thereby; or




     (ix) reduce the percentage or aggregate principal amount of outstanding Notes the
consent of whose Holders is necessary for waiver of compliance with certain provisions of
this Indenture or for waiver of certain defaults.



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     It shall not be necessary for the consent of the Holders under this Section 9.02 to approve
the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if
such consent approves the substance thereof.



     After an amendment, supplement or waiver under this Section 9.02 becomes effective, FelCor LP
shall mail to the Holders affected thereby a notice briefly describing the amendment, supplement or
waiver. FelCor LP shall mail supplemental indentures to Holders upon request. Any failure of
FelCor LP to mail such notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture or waiver.



     SECTION 9.03. Revocation and Effect of Consent. Until an amendment or waiver becomes
effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Note or portion of a Note that evidences the same debt as the Note of the consenting
Holder, even if notation of the consent is not made on any Note. However, any such Holder or
subsequent Holder may revoke the consent as to its Note or portion of its Note. Such revocation
shall be effective only if the Trustee receives the notice of revocation before the date the
amendment, supplement or waiver becomes effective. An amendment, supplement or waiver shall
become effective on receipt by the Trustee of written consents from the Holders of the requisite
percentage in principal amount of the outstanding Notes.



     FelCor LP may, but shall not be obligated to, fix a record date for the purpose of determining
the Holders entitled to consent to any amendment, supplement or waiver. If a record date is fixed,
then, notwithstanding the last two sentences of the immediately preceding paragraph, those persons
who were Holders at such record date (or their duly designated proxies) and only those persons
shall be entitled to consent to such amendment, supplement or waiver or to revoke any consent
previously given, whether or not such persons continue to be Holders after such record date. No
such consent shall be valid or effective for more than 90 days after such record date.



     After an amendment, supplement or waiver becomes effective, it shall bind every Holder unless
it is of the type described in any of clauses (i) through (ix) of Section 9.02. In case of an
amendment or waiver of the type described in clauses (i) through (ix) of Section 9.02, the
amendment or waiver shall bind each Holder who has consented to it and every subsequent Holder of a
Note that evidences the same indebtedness as the Note of the consenting Holder.



     SECTION 9.04. Notation on or Exchange of Notes. If an amendment, supplement or waiver changes
the terms of a Note, the Trustee may require the Holder to deliver it to the Trustee. The Trustee
may place an appropriate notation on the Note about the changed terms and return it to the Holder
and the Trustee may place an appropriate notation on any Note thereafter authenticated.
Alternatively, if FelCor LP or the Trustee so determines, FelCor LP in exchange for the Note shall
issue and the Trustee shall authenticate a new Note that reflects the changed terms.



     SECTION 9.05. Trustee To Sign Amendments, Etc. The Trustee shall be entitled to receive, and
shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of any
amendment, supplement or waiver authorized pursuant to this Article Nine is authorized or permitted
by this Indenture. Subject to the preceding sentence, the Trustee shall sign such amendment,
supplement or waiver if the same does not adversely affect the rights of the Trustee. The Trustee
may, but shall not be obligated to, execute any such amendment, supplement or waiver that affects
the Trustee’s own rights, duties or immunities under this Indenture or otherwise.



     SECTION 9.06. Conformity with Trust Indenture Act. Every supplemental indenture executed
pursuant to this Article Nine shall conform to the requirements of the TIA as then in effect.



ARTICLE X




MISCELLANEOUS




     SECTION 10.01. Trust Indenture Act of 1939. Prior to the effectiveness of the Registration
Statement, this Indenture shall incorporate and be governed by the provisions of the TIA that are
required to be part of and to



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govern indentures qualified under the TIA. After the effectiveness of the Registration
Statement, this Indenture shall be subject to the provisions of the TIA that are required to be a
part of this Indenture and shall, to the extent applicable, be governed by such provisions.




     SECTION 10.02. Notices. Any notice or communication shall be sufficiently given if in writing
and delivered in person or mailed by first class mail addressed as follows:



     if to FelCor, FelCor LP, the Pledgor or any Subsidiary Guarantor:


c/o FelCor Lodging Trust Incorporated

545 East John Carpenter Freeway

Suite 1300

Irving, Texas 75062

Attention: General Counsel




     if to the Trustee:


U.S. Bank National Association

60 Livingston Avenue

EP-MN-WS3C

St. Paul, Minnesota 55107-2292

Attention: Corporate Trust Department




     FelCor, FelCor LP, the Pledgor or a Subsidiary Guarantor or the Trustee by notice to the other
may designate additional or different addresses for subsequent notices or communications.



     Any notice or communication mailed to a Holder shall be mailed to him at his address as it
appears on the Note Register by first class mail and shall be sufficiently given to him if so
mailed within the time prescribed. Copies of any such communication or notice to a Holder shall
also be mailed to the Trustee and each Agent at the same time.



     Failure to mail a notice or communication to a Holder or any defect in it shall not affect its
sufficiency with respect to other Holders. Except for a notice to the Trustee, which is deemed
given only when received, and except as otherwise provided in this Indenture, if a notice or
communication is mailed in the manner provided in this Section 10.02, it is duly given, whether or
not the addressee receives it.



     Where this Indenture provides for notice in any manner, such notice may be waived in writing
by the Person entitled to receive such notice, either before or after the event, and such waiver
shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.



     In case by reason of the suspension of regular mail service or by reason of any other cause it
shall be impracticable to give such notice by mail, then such notification as shall be made with
the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.



     SECTION 10.03. Certificate and Opinion as to Conditions Precedent. Upon any request or
application by FelCor LP to the Trustee to take any action under this Indenture, FelCor LP shall
furnish to the Trustee:




     (i) an Officers’ Certificate stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the proposed action
have been complied with; and




     (ii) an Opinion of Counsel stating that, in the opinion of such Counsel, all such
conditions precedent have been complied with.



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     SECTION 10.04. Statements Required in Certificate or Opinion. Each certificate or opinion
with respect to compliance with a condition or covenant provided for in this Indenture shall
include:




     (i) a statement that each person signing such certificate or opinion has read such
covenant or condition and the definitions herein relating thereto;




     (ii) a brief statement as to the nature and scope of the examination or investigation
upon which the statement or opinion contained in such certificate or opinion is based;




     (iii) a statement that, in the opinion of each such person, he has made such
examination or investigation as is necessary to enable him to express an informed opinion as
to whether or not such covenant or condition has been complied with; and




     (iv) a statement as to whether or not, in the opinion of each such person, such
condition or covenant has been complied with; provided, however, that, with respect to
matters of fact, an Opinion of Counsel may rely on an Officers’ Certificate or certificates
of public officials.



     SECTION 10.05. Rules by Trustee, Paying Agent or Registrar. The Trustee may make reasonable
rules for action by or at a meeting of Holders. The Paying Agent or Registrar may make reasonable
rules for its functions.



     SECTION 10.06. Payment Date Other Than a Business Day. If an Interest Payment Date,
Redemption Date, Payment Date, Stated Maturity or date of maturity of any Note shall not be a
Business Day, then payment of principal of, premium, if any, or interest on such Note, as the case
may be, need not be made on such date, but may be made on the next succeeding Business Day with the
same force and effect as if made on the Interest Payment Date, Payment Date, or Redemption Date, or
at the Stated Maturity or date of maturity of such Note; provided that no interest shall accrue for
the period from and after such Interest Payment Date, Payment Date, Redemption Date, Stated
Maturity or date of maturity, as the case may be.



     SECTION 10.07. Governing Law. The laws of the State of New York shall govern this Indenture
and the Notes. The Trustee, FelCor LP and the Holders agree to submit to the jurisdiction of the
courts of the State of New York in any action or proceeding arising out of or relating to this
Indenture or the Notes. Notwithstanding the foregoing, the situs of the trusts created hereunder
shall be deemed to be the Corporate Trust Office at which location the trusts shall be
administered.



     SECTION 10.08. No Adverse Interpretation of Other Agreements. This Indenture may not be used
to interpret another indenture, loan or debt agreement of FelCor LP, the Guarantors or any
Subsidiary of any such Person. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.



     SECTION 10.09. No Recourse Against Others. No recourse for the payment of the principal of,
premium, if any, or interest on any of the Notes, or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or agreement of FelCor LP,
the Guarantors or the Pledgor contained in this Indenture, or in any of the Notes, or because of
the creation of any Indebtedness represented thereby, shall be had against any incorporator or
against any past, present or future limited partner, stockholder, other equity holder (other than a
general partner), officer, director, employee or controlling person, as such, of FelCor LP, FelCor,
the Subsidiary Guarantors or the Pledgor or of any successor Person, either directly or through
FelCor LP or any successor Person, whether by virtue of any constitution, statute or rule of law,
or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that
all such liability is hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of the Notes.



     SECTION 10.10. Successors. All agreements of FelCor LP, FelCor, the Pledgor or the Subsidiary
Guarantors in this Indenture and the Notes shall bind its successors. All agreements of the
Trustee in this Indenture shall bind its successors.



     SECTION 10.11. Duplicate Originals. The parties may sign any number of copies of this
Indenture. Each signed copy shall be an original, but all of them together represent the same
agreement.



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     SECTION 10.12. Separability. In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.



     SECTION 10.13. Table of Contents, Headings, Etc. The Table of Contents, Cross-Reference Table
and headings of the Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof and shall in no way modify or restrict any
of the terms and provisions hereof.



ARTICLE XI




GUARANTEE OF THE NOTES




     SECTION 11.01. Guarantee. Subject to the provisions of this Article Eleven, each Guarantor,
jointly and severally, hereby unconditionally guarantees to each Holder and to the Trustee on
behalf of the Holders: (i) the due and punctual payment of the principal of, premium if any, on
and interest on the Notes, when and as the same shall become due and payable, whether at maturity,
by acceleration, redemption or otherwise, the due and punctual payment of interest on the overdue
principal of and interest, if any, on the Notes, to the extent lawful, and the due and punctual
performance of all other obligations of FelCor LP to the Holders or the Trustee, all in accordance
with the terms of such Note and this Indenture and (ii) in the case of any extension of time of
payment or renewal of any Notes or any of such other obligations, that the same will be promptly
paid in full when due or performed in accordance with the terms of the extension or renewal, at
stated maturity, by acceleration, redemption or otherwise. Each Guarantor hereby waives diligence,
presentment, filing of claims with a court in the event of merger or bankruptcy of FelCor LP, any
right to require a proceeding first against FelCor LP, the benefit of discussion, protest or notice
with respect to any such Note or the debt evidenced thereby and all demands whatsoever (except as
specified above), and covenants that this Article Eleven will not be discharged as to any such Note
except by payment in full of the principal thereof and interest thereon and as provided in Sections
8.01 and 8.02. The maturity of the obligations guaranteed hereby may be accelerated as provided in
Article Six for the purposes of this Article Eleven. In the event of any declaration of
acceleration of such obligations as provided in Article Eleven, such obligations (whether or not
due and payable) shall become due and payable immediately by the Guarantor for the purpose of this
Article Eleven. In addition, without limiting the foregoing provisions, upon the effectiveness of
an acceleration under Article Six, the Trustee shall promptly make a demand for payment on the
Notes under the Guarantees provided for in this Article Eleven.



     Each Guarantor hereby irrevocably waives any claim or other rights which it may now or
hereafter acquire against performance or enforcement of such Guarantor’s obligations under this
Indenture, including, without limitation, any right of subrogation, reimbursement, exoneration,
contribution, indemnification, any right to participate in any claim or remedy of the Holders
against FelCor LP, whether or not such claim, remedy or right arises in equity, or under contract,
statute or common law, including, without limitation, the right to take or receive from FelCor LP,
directly or indirectly, in cash or other property or in any other manner, payment or security on
account of such claim or other rights. If any amount shall be paid to any Guarantor in violation
of the preceding sentence and the principal of, premium if any, and accrued interest on the Notes
shall not have been paid in full, such amount shall be deemed to have been paid to such Guarantor
for the benefit of, and held in trust for the benefit of, the Holders, and shall immediately be
paid to the Trustee for the benefit of the Holders to be credited and applied upon the principal
of, premium, if any, and accrued interest on the Notes. Each Guarantor acknowledges that it will
receive direct and indirect benefits from the issuance of the Notes pursuant to this Indenture and
that the waiver set forth in this paragraph is knowingly made in contemplation of such benefits.



     The Guarantee set forth in this Section 11.01 shall not be valid or become obligatory for any
purpose with respect to a Note until the certificate of authentication on such Note shall have been
signed by or on behalf of the Trustee.



     Notwithstanding anything contained in this Article Eleven to the contrary, the parties
acknowledge that FelCor Holdings Trust has been formed under the laws of the Commonwealth of
Massachusetts pursuant to a Declaration of Trust dated as of July 31, 2002, and in accordance with
the Declaration of Trust, none of the shareholders, trustees or officers of FelCor Holdings Trust
shall be personally liable for such Guarantor’s obligations under this



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Article Eleven, and the Trustee shall look solely to the trust estate comprising FelCor
Holdings Trust for the payment of any claim under such obligations or for the performance of such
obligations.



     SECTION 11.02. Obligations of Guarantor Unconditional. Nothing contained in this Article
Eleven or elsewhere in this Indenture or in the Notes is intended to or shall impair, as among each
Guarantor and the Holders of the Notes, the obligation of each Guarantor, which is absolute and
unconditional, upon failure by FelCor LP, to pay to the Holders of the Notes and principal of,
premium, if any, and interest on the Notes as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative rights of the Holders
of the Notes and creditors of each Guarantor, nor shall anything herein or therein prevent the
Holder of any Note or the Trustee on their behalf from exercising all remedies otherwise permitted
by applicable law upon default under this Indenture.



     Without limiting the generality of the foregoing, nothing contained in this Article Eleven
will restrict the right of the Trustee or the Holders of the Notes to take any action to declare
the Guarantees to be due and payable prior to the stated maturity of the Notes pursuant to Section
6.02 or to pursue any rights or remedies hereunder.



     SECTION 11.03. Notice to Trustee. Each Guarantor shall give prompt written notice to the
Trustee of any fact known to such Guarantor which would prohibit the making of any payment to or by
the Trustee in respect of the Guarantee pursuant to the provisions of this Article Eleven.



     SECTION 11.04. This Article Not To Prevent Events of Default. The failure to make a payment
on account of principal, of premium, if any, or interest on the Notes by reason of any provision of
this Article Eleven will not be construed as preventing the occurrence of an Event of Default.



     SECTION 11.05. Trustee’s Compensation Not Prejudiced. Nothing in this Article Eleven will
apply to amounts due to the Trustee pursuant to other sections in this Indenture.



     SECTION 11.06. Payments May Be Paid Prior to Dissolution. Nothing contained in this Article
Eleven or elsewhere in this Indenture shall prevent (i) a Guarantor from making payments of
principal of, premium if any, and interest on the Notes, or from depositing with the Trustee any
monies for such payments or (ii) the application by the Trustee of any monies deposited with it for
the purpose of making such payments of principal of, premium, if any, and interest on the Notes to
the Holders entitled thereto, each Guarantor shall give prompt written notice to the Trustee of any
dissolution, winding up, liquidation or reorganization of such Guarantor.



     SECTION 11.07. Release of Guarantee. The Guarantee provided pursuant to this Article Eleven
by each Subsidiary Guarantor shall be automatically and unconditionally released and discharged
upon (i) the sale or other disposition of the Capital Stock of such Subsidiary Guarantor, if, as a
result of such sale or disposition, such Subsidiary Guarantor ceases to be a subsidiary of FelCor
LP; provided such sale or other disposition is in compliance with the terms of this Indenture, (ii)
the consolidation or merger of any such Subsidiary Guarantor with any person other than FelCor LP
or a Subsidiary of FelCor LP, if, as a result of such consolidation or merger, such Subsidiary
Guarantor ceases to be a subsidiary of FelCor LP; provided such consolidation or merger is in
compliance with this Indenture, (iii) a defeasance under Section 8.02 or 8.03 of this Indenture or
(iv) the unconditional and complete release of such Subsidiary Guarantor from its Guarantee of all
Guaranteed Indebtedness.



ARTICLE XII




SECURITY




     SECTION 12.01. Security. The due and punctual payment of FelCor’s obligations under this
Indenture and the Notes, when and as the same shall be due and payable, whether on an interest
payment date, at maturity, by acceleration, call for redemption or otherwise, and performance of
all other obligations of FelCor LP, to the Holders or the Trustee under this Indenture and in
respect of the Notes, according to the terms hereof or thereof, shall be secured as provided in the
Collateral Documents.



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     At the time the Collateral Documents are executed, the Pledgor will: (a) for so long as the
Notes are outstanding, warrant and defend the title to the Pledged Collateral against the claims of
all Persons whatsoever unless the Pledged Collateral is released as provided in the Collateral
Documents, (b) execute, acknowledge and deliver to the Collateral Agent and the Trustee such
further assignments, transfers, assurances or other instruments as the Collateral Agent or the
Trustee may require or request and (c) do or cause to be done all such acts and things as may be
necessary or proper, or as may be required by the Collateral Agent or the Trustee, to assure and
confirm to the Collateral Agent and the Trustee the security interest in the Pledged Collateral
contemplated hereby and by the Collateral Documents, or any part thereof, as from time to time
constituted, so as to render the same available for the security and benefit of this Indenture and
of the Notes secured hereby, according to the intent and purposes herein expressed. The Collateral
Documents will create a valid and perfected security interest on the property constituting the
Pledged Collateral as set forth in the Collateral Documents.



     The Pledged Collateral shall secure FelCor LP’s obligations and performance of all other
obligations of Felcor LP, up to the amount outstanding from time to time under the Notes and any
amount owed to the Trustee. The claims of the Trustee and Holders against the Pledged Collateral
will be subject to the Collateral Agency Agreement. The Holders hereby authorize and direct the
Trustee to enter into the Collateral Agency Agreement on their behalf.



     SECTION 12.02. Recording and Opinions. FelCor LP and the Pledgor will cause, at their own
expense, the Collateral Documents, this Indenture and all amendments or supplements thereto to be
registered, recorded and filed or re-recorded, re-filed and renewed in such manner and in such
place or places, if any, as may be required by law in order fully to preserve and protect the Liens
created by the Collateral Documents on all parts of the Pledged Collateral and to effectuate and
preserve the security of the Holders and all rights of the Trustee and the Collateral Agent.



     FelCor LP and the Pledgor shall furnish to the Trustee, promptly after the execution and
delivery of the Collateral Documents, an Opinion of Counsel either (i) stating that, in the opinion
of such counsel, the Collateral Documents have been properly recorded, registered and filed to the
extent necessary to make effective the security interest intended to be created by the Collateral
Documents, and reciting the details of such action or referring to prior opinions of counsel in
which such details are given, and stating that as to the Collateral Documents such recording,
registering and filing are the only recordings, registrations and filings necessary to give notice
thereof and that no re-recordings, re-registrations or re-filings are necessary to maintain such
notice, and further stating that all financing statements, continuation statements and other
instruments of further assurance have been executed and filed that are necessary fully to preserve
and protect the rights of the Collateral Agent on behalf of the Holders and the Trustee hereunder
and under the Collateral Documents, or (ii) stating that, in the opinion of such counsel, no such
action is necessary to make such security interest effective. To the extent applicable, FelCor LP
and the Pledgor shall comply with Trust Indenture Act § 314(b).



     SECTION 12.03. Release and Disposition of Collateral.



     (a) The parties hereto agree and acknowledge that the Pledged Collateral may be released by
the Collateral Agent at any time in accordance with the terms of the Collateral Documents, and the
Pledged Collateral so released shall automatically be released as security for this Indenture and
the Notes without any action on the part of the Trustee or the Holders, except as may be provided
in the Collateral Documents. In addition, the Pledged Collateral shall be released upon (i)
payment of all principal, premium, if any and interest under this Indenture and the Notes, (ii) a
redemption of all of the Notes effected by FelCor LP in accordance with Article Three, (iii) legal
defeasance effected by FelCor LP in accordance with Section 8.03, (iv) upon a satisfaction and
discharge effected by FelCor LP in accordance with Section 8.02; or (v) by consent of Holders of
not less than 66-2/3% of the aggregate principal amount of the Notes then outstanding.



     (b) The release of all or any portion of the Pledged Collateral from the Lien under the
Collateral Documents pursuant to the terms hereof and of the Collateral Documents will not be
deemed to impair the security interest under this Indenture in contravention of the provisions
hereof. To the extent applicable, FelCor LP and the Pledgor shall cause Trust Indenture Act
Section 314(d) relating to the release of property from the Lien under the Collateral Documents to
be complied with. Any certificate or opinion required by Trust Indenture Act Section



-61-









 




314(d) may be made by an Officer of FelCor, in its capacity as general partner of FelCor LP,
except in cases in which Trust Indenture Act Section 314(d) requires that such certificate or
opinion be made by an independent Person. It is expressly understood that this Section 12.03(b)
relates only to obligations under the TIA and shall not restrict or otherwise affect the Pledgor’s
or Felcor LP’s rights or abilities to obtain a release of the Pledged Collateral pursuant to the
terms of the Collateral Documents or as otherwise permitted hereunder.




     SECTION 12.04. Enforcement of Claims Against Pledged Collateral. If the Notes become due and
payable prior to their final Stated Maturity for any reason or are not paid in full at the final
Stated Maturity and no payment has been made following a demand on FelCor LP, the Collateral Agent
has the right to foreclose or otherwise realize upon the relevant Collateral in accordance with the
terms of the Collateral Documents. The proceeds received by the Collateral Agent upon a
foreclosure or realization will be applied by the Collateral Agent in accordance with the
Collateral Agency Agreement.



     SECTION 12.05. Authorization of Actions To Be Taken by the Trustee. Subject to the provisions
of the Collateral Documents, the Trustee shall have power to institute and to maintain such suits
and proceedings as it may deem expedient to prevent any impairment of the Pledged Collateral by any
acts which may be unlawful or in violation of the Collateral Documents or this Indenture, and such
suits and proceedings as the Trustee may deem expedient to preserve or protect its interests and
the interests of the Holders in the Pledged Collateral (including power to institute and maintain
suits or proceedings to restrain the enforcement of or compliance with any legislative or
governmental enactment, rule, or order that may be unconstitutional or otherwise invalid if the
enforcement of, or compliance with, such enactment, rule or order would impair the security
hereunder or be prejudicial to the interest of the Holders or the Trustee). Notwithstanding
anything herein or in any of the Collateral Documents to the contrary, subject to Article VII
hereof, the Trustee assumes no responsibility for the validity, perfection, priority or
enforceability of the security interest in any of the Pledged Collateral and shall have no
obligation to take any action to procure or maintain such validity, perfection, priority or
enforceability.



     SECTION 12.06. General Partner Interest in FelCor LP. At any time upon or following the
foreclosure by the Collateral Agent on the Pledged Collateral, the Collateral Agent shall have the
right to require FelCor to transfer its general partner interest in FelCor LP to the Collateral
Agent for an aggregate purchase price of $1.00. Such transfer right shall be the exclusive right
of the Collateral Agent. Additionally, so long as any Notes are outstanding under this Indenture,
FelCor shall not directly or indirectly create, Incur, assume or pledge, or suffer to exist any
Lien on, its general partner interest in FelCor LP.



     SECTION 12.07. Appointment of Collateral Agent. The Trustee on its own behalf and on behalf
of the Holders hereby appoints JPMorgan Chase Bank, NA (and any of its successors and assigns under
the Collateral Agency Agreement) as a collateral agent (together with such successors and assigns
the “Collateral Agent”) to act under the Collateral Documents and for creation and perfection of
the security interest in the Pledged Collateral for the equal and ratable benefit of the Trustee
and the Holders and the other Secured Parties (as defined in the Collateral Agency Agreement). The
Trustee on its own behalf and on behalf of the Holders hereby authorizes the Collateral Agent to
enter into the Pledge Agreement, the Collateral Agency Agreement and all other Collateral Documents
on behalf and for the equal and ratable benefit of the Trustee and the Holders and the other
Secured Parties.



     SECTION 12.08. Limitation on Liability. The Pledgor has been formed under the laws of the
Commonwealth of Massachusetts pursuant to a Declaration of Trust dated as of July 31, 2002. In
accordance with the Declaration of Trust, none of the shareholders, trustees or officers of the
Pledgor shall be personally liable for any of the Pledgor’s obligations arising under this
Indenture, the Notes, the Exchange Notes or the Collateral Documents, and the Trustee and the
Holders shall look solely to the trust estate comprising the Pledgor for the payment of any claim
under such obligations or for the performance of such obligations.




-62-









 








SIGNATURES




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



	 	 	 	 	 	 	 	 
	 	 	FELCOR LODGING TRUST INCORPORATED	 
	 
	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Jonathan H. Yellen	 
	 

	 	 	 	 	 
	 

	 	 	 	Name:	 	Jonathan H. Yellen	 
	 

	 	 	 	Title:	 	Executive Vice President,

General Counsel and Secretary	 
	 
	 	 	 	 	 	 	 
	 	 	FELCOR LODGING LIMITED PARTNERSHIP	 
	 
	 	 	 	 	 	 	 
	 

	 	By:
	 	FelCor Lodging Trust Incorporated, General

Partner	 
	 
	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Jonathan H. Yellen	 
	 

	 	 	 	 	 
	 

	 	 	 	Name:	 	Jonathan H. Yellen	 
	 

	 	 	 	Title:	 	Executive Vice President,

General Counsel and Secretary	 
	 
	 	 	 	 	 	 	 
	 	 	FELCOR HOLDINGS TRUST	 
	 
	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Lester C. Johnson	 
	 

	 	 	 	 	 
	 

	 	 	 	Name:	 	Lester C. Johnson	 
	 

	 	 	 	Title:	 	Trustee	 
	 
	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Larry J. Mundy	 
	 

	 	 	 	 	 
	 

	 	 	 	Name:	 	Larry J. Mundy	 
	 

	 	 	 	Title:	 	Trustee	 






 









 







	 	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee
	 
	 	 	 	 
	 

	 	By:	 	/s/ Richard Prokosch
	 

	 	 	 	 
	 

	 	 	 	Name: Richard Prokosch
	 

	 	 	 	Title: Vice President











 







	 	 	 	 	 
	 	 	FELCOR HOTEL ASSET COMPANY, L.L.C.
	 	 	FELCOR PENNSYLVANIA COMPANY, L.L.C.
	 	 	FELCOR LODGING HOLDING COMPANY, L.L.C.
	 	 	FELCOR OMAHA HOTEL COMPANY, L.L.C.
	 	 	FELCOR CANADA CO.
	 	 	FELCOR/CSS HOLDINGS, L.P.
	 

	 	 	By: FELCOR/CSS HOTELS, L.L.C., General Partner
	 	 	FHAC TEXAS HOLDINGS, L.P.
	 

	 	 	By: FELCOR HOTEL ASSET COMPANY, L.L.C., General Partner
	 	 	FELCOR TRS HOLDINGS, L.P.
	 

	 	 	 	By: FELCOR TRS I, LLC
	 	 	MYRTLE BEACH HOTELS, L.L.C.
	 	 	FELCOR TRS BORROWER 1, L.P.
	 

	 	 	 	By: FELCOR TRS BORROWER GP 1, L.L.C., General Partner
	 	 	FELCOR TRS GUARANTOR, L.P.
	 

	 	 	 	By: FELCOR TRS GUARANTOR GP, L.L.C., General Partner
	 	 	CENTER CITY HOTEL ASSOCIATES
	 

	 	 	 	By: FELCOR PHILADELPHIA CENTER, L.L.C., General Partner
	 	 	FELCOR LODGING COMPANY, L.L.C.
	 	 	FELCOR TRS BORROWER 3, L.P.
	 

	 	 	 	By: FELCOR TRS BORROWER GP 3, L.L.C., General Partner
	 	 	FELCOR TRS BORROWER 4, L.L.C.
	 
	 	 	 	 
	 

	 	By:	 	/s/ Jonathan H. Yellen
	 

	 	 	 
	 

	 	 	Name: Jonathan H. Yellen
	 

	 	 	Title: Executive Vice
President,

General Counsel and Secretary












 





EXHIBIT A




[FACE OF NOTE]




Senior Secured Floating Rate Note due 2011




[CUSIP]                     




			
	No.
	 	$                    
	 	 	 





     FELCOR LODGING LIMITED PARTNERSHIP, a Delaware limited partnership (“FelCor LP”, which term
includes any successor under the Indenture hereinafter referred to), for value received, promises
to pay to CEDE & Co., or its registered assigns, the principal sum of                      ($                    ) on
December 1, 2011.



     Interest Payment Dates: June 1 and December 1, commencing June 1, 2007.



     Regular Record Dates: May 15 and November 15.



     Reference is hereby made to the further provisions of this Note set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as if set forth at
this place.



     IN WITNESS WHEREOF, FelCor LP has caused this Note to be signed manually or by facsimile by
its duly authorized officers.



	 	 	 	 	 
	 	 	FELCOR LODGING LIMITED PARTNERSHIP
	 

	 	By:
	 	FELCOR
LODGING TRUST INCORPORATED, General Partner

	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:






A-1









 





(Trustee’s Certificate of Authentication)




     This is one of the Senior Secured Floating Rate Notes due 2011 described in the
within-mentioned Indenture.



Date:



	 	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Authorized Signatory






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[REVERSE SIDE OF NOTE]




FELCOR LODGING LIMITED PARTNERSHIP




Senior Secured Floating Rate Note due 2011



1. Principal and Interest.




     FelCor LP will pay the principal of this Note on December 1, 2011.



     Interest on the Notes will be payable semi-annually in cash on each June 1 and December 1
commencing on June 1, 2007 (each, an “Interest Payment Date”), to the Holders of record of the
Notes at the close of business on May 15 and November 15 immediately preceding the applicable
Interest Payment Date.



     If an exchange offer registered under the Securities Act is not consummated and a shelf
registration statement under the Securities Act with respect to resales of the Notes is not
declared effective by the Commission on or before April 29, 2007 in accordance with the terms of
the Registration Rights Agreement, interest due on the Notes will accrue at an annual rate of 0.5%
plus the interest rate specified on the face hereof until the exchange offer is consummated or the
shelf registration statement is declared effective. The Holder of this Note is entitled to the
benefits of such Registration Rights Agreement.



     Interest on the Notes will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from the Closing Date.



     This Note will bear interest at a rate per annum (the “Applicable Interest Rate”), reset
semi-annually, equal to LIBOR plus 1.875%, as determined by the calculation agent appointed by
FelCor LP (the “Calculation Agent”), which shall initially be the Trustee.



     Set forth below is a summary of certain of the defined terms used in this Section 1 relating
to the determination of interest on this Note.



     “Determination Date,” with respect to an Interest Period, will be the second London Banking
Day preceding the first day of the Interest Period.



     “Interest Period” means the period commencing on and including an interest payment date and
ending on and including the day immediately preceding the next succeeding interest payment date,
with the exception that the first Interest Period shall commence on and include the Closing Date
and end on and include May 31, 2007.



     “LIBOR,” with respect to an Interest Period, will be the rate (expressed as a percentage per
annum) for deposits in United States dollars for a six-month period beginning on the second London
Banking Day after the Determination Date that appears on Telerate Page 3750 as of 11:00 a.m.,
London time, on the Determination Date. If Telerate Page 3750 does not include such a rate or is
unavailable on a Determination Date, the Calculation Agent will request the principal London office
of each of four major banks in the London interbank market, as selected by the Calculation Agent,
to provide such bank’s offered quotation (expressed as a percentage per annum), as of approximately
11:00 a.m., London time, on such Determination Date, to prime banks in the London interbank market
for deposits in a Representative Amount in United States dollars for a six-month period beginning
on the second London Banking Day after the Determination Date. If at least two such offered
quotations are so provided, LIBOR for the Interest Period will be the arithmetic mean of such
quotations. If fewer than two such quotations are so provided, the Calculation Agent will request
each of three major banks in New York City, as selected by the Calculation Agent, to provide such
bank’s rate (expressed as a percentage per annum), as of approximately 11:00 a.m., New York City
time, on such Determination Date, for loans in a Representative Amount in United States dollars to
leading European banks for a six-month period beginning on the second London Banking Day after the
Determination Date. If at least two such rates are so provided, LIBOR for the Interest Period will
be the arithmetic mean of such rates. If fewer than two such rates are so provided, then LIBOR for
the Interest Period will be LIBOR in effect with respect to the immediately preceding Interest
Period.



A-3









 





     “London Banking Day” is any day in which dealings in United States dollars are transacted or,
with respect to any future date, are expected to be transacted in the London interbank market.



     “Representative Amount” means a principal amount of not less than U.S. $1,000,000 for a single
transaction in the relevant market at the relevant time.



     “Telerate Page 3750” means the display designated as “Page 3750” on the Moneyline Telerate
service (or such other page as may replace Page 3750 on that service).



     The amount of interest for each day that the Notes are outstanding (the “Daily Interest
Amount”) will be calculated by dividing the interest rate in effect for such day by 360 and
multiplying the result by the principal amount of the Notes. The amount of interest to be paid on
the Notes for each Interest Period will be calculated by adding the Daily Interest Amounts for each
day in the Interest Period.



     All percentages resulting from any of the above calculations will be rounded, if necessary, to
the nearest one hundred-thousandth of a percentage point, with the final one-millionths of a
percentage point being rounded upwards (e.g., 9.876545% (or .09876545) being rounded to 9.87655%
(or .0987655)) and all dollar amounts used in or resulting from such calculations will be rounded
to the nearest cent (with one-half cent being rounded upwards).



     The interest rate on the Notes will in no event be higher than the maximum rate permitted by
New York law as the same may be modified by United States law of general application.



     The Calculation Agent will, upon the request of the Holder of any Note, provide the interest
rate then in effect with respect to the Notes. All calculations made by the Calculation Agent in
the absence of manifest error will be conclusive for all purposes and binding on FelCor LP, the
Guarantors and the Holders of the Notes.



     FelCor LP shall pay interest on overdue principal and premium, if any, and interest on overdue
installments of interest, to the extent lawful, at a rate per annum that is 2% in excess of the
rate otherwise payable.



2. Method of Payment.




     FelCor LP will pay interest (except defaulted interest) on the principal amount of the Notes
as provided above on each June 1 and December 1 to the persons who are Holders (as reflected in the
Note Register at the close of business on such May 15 and November 15 immediately preceding the
Interest Payment Date), in each case, even if the Note is canceled on registration of transfer or
registration of exchange after such record date; provided that, with respect to the payment of
principal, FelCor LP will make payment to the Holder that surrenders this Note to a Paying Agent on
or after December 1, 2011.



     FelCor LP will pay principal, premium, if any, and as provided above, interest in money of the
United States that at the time of payment is legal tender for payment of public and private debts.
However, FelCor LP may pay principal, premium, if any, and interest by its check payable in such
money. It may mail an interest check to a Holder’s registered address (as reflected in the Note
Register). If a payment date is a date other than a Business Day at a place of payment, payment
may be made at that place on the next succeeding day that is a Business Day and no interest shall
accrue for the intervening period.



3. Paying Agent and Registrar.




     Initially, the Trustee will act as authenticating agent, Paying Agent and Registrar. FelCor
LP may change any authenticating agent, Paying Agent or Registrar without notice. FelCor LP, any
Subsidiary or any Affiliate of any of them may act as Paying Agent, Registrar or co-Registrar.



4. Indenture; Limitations.




     FelCor LP issued the Notes under an Indenture dated as of October 31, 2006 (the “Indenture”),
among FelCor LP, FelCor, the Subsidiary Guarantors, the Pledgor and U.S. Bank National Association
(the “Trustee”). Capitalized



A-4









 








terms herein are used as defined in the Indenture unless otherwise indicated. The
terms of the Notes include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act. The Notes are subject to all such terms, and Holders are
referred to the Indenture and the Trust Indenture Act for a statement of all such terms. To the
extent permitted by applicable law, in the event of any inconsistency between the terms of this
Note and the terms of the Indenture, the terms of the Indenture shall control.



     The Notes are general secured obligations of FelCor LP.



5. Redemption.




     Except as provided below, FelCor LP may not redeem any of the Notes prior to December 1, 2007.



     The Notes may be redeemed at the option of FelCor LP, in whole or in part, at any time and
from time to time, on or after December 1, 2007, upon not less than 15 days’ nor more than 60 days’
notice, at the following Redemption Prices (expressed as percentages of the principal amount
thereof) if redeemed during the 12-month period commencing December 1 of the years indicated below,
in each case together with accrued and unpaid interest thereon to the Redemption Date:



	 	 	 	 	 
	Year	 	Redemption Price
	2007
	 	 	101.000	%
	2008 and thereafter
	 	 	100.000	%






     Notwithstanding the foregoing, at any time, or from time to time, on or prior to December 1,
2009, FelCor LP may, at its option, use the net cash proceeds of one or more Equity Offerings to
redeem up to 35% of the principal amount of the Notes at a Redemption Price (expressed as a
percentage of the principal amount thereof) equal to the sum of (a) 100% plus (b) the then
Applicable Interest Rate on the Notes, together with accrued and unpaid interest thereon, if any,
to the Redemption Date; provided that




     (i) at least 65% of the principal amount of the Notes issued under this Indenture
remains outstanding immediately after such redemption; 

 and




     (ii) FelCor LP makes such redemption not more than 90 days after the consummation of
any such Equity Offering.



     Notice of any optional redemption will be mailed at least 15 but not more than 60 days before
the Redemption Date to each Holder of Notes to be redeemed at its last address as it appears in the
Note Register. Notes in original principal amount greater than $1,000 may be redeemed in part. On
and after the Redemption Date, interest ceases to accrue on Notes or portions thereof called for
redemption, unless FelCor LP defaults in the payment of the amount due upon redemption.



6. Repurchase upon Change in Control.




     Upon the occurrence of any Change of Control, each Holder shall have the right to require the
repurchase of its Notes by FelCor LP in cash pursuant to the offer described in the Indenture at a
purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if
any, to the date of purchase (the “Change of Control Payment”).



     A notice of such Change of Control will be mailed within 30 days after any Change of Control
occurs to each Holder at his last address as it appears in the Note Register. Notes in original
denominations larger than $1,000 may be sold to FelCor LP in part. On and after the Change of
Control Payment Date, interest ceases to accrue on Notes or portions of Notes surrendered for
purchase by FelCor LP, unless FelCor LP defaults in the payment of the Change of Control Payment.



A-5









 





7. Denominations; Transfer; Exchange.




     The Notes are in registered form without coupons in denominations of $1,000 of principal
amount at maturity and multiples of $1,000 in excess thereof. A Holder may register the transfer
or exchange of Notes in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture. The Registrar need not register the transfer
or exchange of any Notes selected for redemption. Also, it need not register the transfer or
exchange of any Notes for a period of 15 days before a selection of Notes to be redeemed is made.



8. Persons Deemed Owners.




     A Holder shall be treated as the owner of a Note for all purposes.



9. Unclaimed Money.




     If money for the payment of principal, premium, if any, or interest remains unclaimed for two
years, the Trustee and the Paying Agent will pay the money back to FelCor LP at its request. After
that, Holders entitled to the money must look to FelCor LP for payment, unless an abandoned
property law designates another Person, and all liability of the Trustee and such Paying Agent with
respect to such money shall cease.



10. Discharge Prior to Redemption or Maturity.




     If FelCor LP deposits with the Trustee money or U.S. Government Obligations sufficient to pay
the then outstanding principal of, premium, if any, and accrued interest on the Notes (a) to
redemption or maturity, FelCor LP will be discharged from the Indenture and the Notes, except in
certain circumstances for certain sections thereof, and (b) to the Stated Maturity, FelCor LP will
be discharged from certain covenants set forth in the Indenture.



11. Amendment; Supplement; Waiver.




     Subject to certain exceptions, the Indenture, the Notes or the Collateral Documents may be
amended or supplemented with the consent of the Holders of at least a majority in principal amount
of the Notes then outstanding, and any existing default or compliance with any provision may be
waived with the consent of the Holders of at least a majority in principal amount of the Notes then
outstanding. Without notice to or the consent of any Holder, the parties thereto may amend or
supplement the Indenture or the Notes to, among other things, cure any ambiguity, defect or
inconsistency and make any change that does not materially and adversely affect the rights of any
Holder.



12. Restrictive Covenants.




     The Indenture imposes certain limitations on the ability of FelCor, FelCor LP and their
respective Restricted Subsidiaries, among other things, to Incur additional Indebtedness, make
Restricted Payments, use the proceeds from Asset Sales, engage in transactions with Affiliates or
merge, consolidate or transfer substantially all of their assets. Within 45 days after the end of
each fiscal quarter (90 days after the end of the last fiscal quarter of each year), FelCor and
FelCor LP must report to the Trustee on compliance with such limitations.



13. Successor Persons.




     When a successor person or other entity assumes all the obligations of its predecessor under
the Notes and the Indenture, the predecessor person will be released from those obligations.



14. Defaults and Remedies.




     The following events constitute “Events of Default” under the Indenture:



A-6









 






     (a) default in the payment of principal of (or premium, if any, on) any Note when the
same becomes due and payable at maturity, upon acceleration, redemption or otherwise;




     (b) default in the payment of interest on any Note when the same becomes due and
payable, and such default continues for a period of 30 days;




     (c) default in the performance or breach of the provisions of the Indenture applicable
to mergers, consolidations and transfers of all or substantially all of the assets of FelCor
LP and FelCor or the failure by FelCor LP to make or consummate an Offer to Purchase in
accordance with Section 4.10 or Section 4.11;




     (d) FelCor LP or FelCor defaults in the performance of or breaches any other covenant
or agreement of FelCor LP or FelCor in the Indenture or under the Notes (other than a
default specified in clause (a), (b) or (c) above) and such default or breach continues for
a period of 60 consecutive days after written notice by the Trustee or the Holders of 25% or
more in aggregate principal amount of the Notes;




     (e) there occurs with respect to any issue or issues of Indebtedness of FelCor LP or
FelCor or any Significant Subsidiary having an outstanding principal amount of $10 million
or more in the aggregate for all such issues of all such Persons, whether such Indebtedness
now exists or shall hereafter be created, (i) an event of default that has caused the holder
thereof to declare such Indebtedness to be due and payable prior to its Stated Maturity and
such Indebtedness has not been discharged in full or such acceleration has not been
rescinded or annulled within 30 days of such acceleration and/or (ii) the failure to make a
principal payment at the final (but not any interim) fixed maturity and such defaulted
payment shall not have been made, waived or extended within 30 days of such payment default;




     (f) any final judgment or order (not covered by insurance) for the payment of money in
excess of $10 million in the aggregate for all such final judgments or orders against all
such Persons (treating any deductibles, self-insurance or retention as not covered by
insurance) (i) shall be rendered against FelCor LP or FelCor or any Significant Subsidiary
and shall not be paid or discharged, and (ii) there shall be any period of 60 consecutive
days following entry of the final judgment or order that causes the aggregate amount for all
such final judgments or orders outstanding and not paid or discharged against all such
Persons to exceed $10 million during which a stay of enforcement of such final judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect;




     (g) a court having jurisdiction in the premises enters a decree or order for (i) relief
in respect of FelCor LP or FelCor or any Significant Subsidiary in an involuntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, (ii)
appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of FelCor LP or FelCor or any Significant Subsidiary or for all or substantially
all of the property and assets of FelCor LP or FelCor or any Significant Subsidiary or (iii)
the winding up or liquidation of the affairs of FelCor LP or FelCor or any Significant
Subsidiary and, in each case, such decree or order shall remain unstayed and in effect for a
period of 60 consecutive days;




     (h) FelCor LP or FelCor or any Significant Subsidiary (i) commences a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect,
or consents to the entry of an order for relief in an involuntary case under such law, (ii)
consents to the appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of FelCor LP or FelCor or Significant
Subsidiary or for all or substantially all of the property and assets of FelCor LP or FelCor
or any Significant Subsidiary or (iii) effects any general assignment for the benefit of its
creditors;




     (i) any Note Guarantee ceases to be in full force and effect (other than in accordance
with the terms of such Note Guarantee and the Indenture) or any Guarantor notifies the
Trustee in writing that it denies or disaffirms its obligations under its Note Guarantee; or



A-7









 






     (j) the repudiation by FelCor LP or FelCor of any of its obligations under any
Collateral Document or the unenforceability of any Collateral Document against FelCor LP or
FelCor if such unenforceability reasonably would be expected to result in a material adverse
effect on the Liens granted pursuant to such Collateral Documents.



     If an Event of Default (other than an Event of Default described in subparagraphs (g) or (h)
above that occurs with respect to FelCor LP or FelCor) occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Notes may declare all the Notes to be due and
payable. If an Event of Default described in subparagraphs (g) or (h) above occurs with respect to
FelCor LP or FelCor, the Notes automatically become due and payable. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes. Subject to certain limitations,
Holders of at least a majority in principal amount of the Notes then outstanding may direct the
Trustee in its exercise of any trust or power.



15. Trustee Dealings with Company.




     The Trustee under the Indenture, in its individual or any other capacity, may make loans to,
accept deposits from and perform services for FelCor LP or its Affiliates and may otherwise deal
with FelCor LP or its Affiliates as if it were not the Trustee.



16. No Recourse Against Others.




     No incorporator or any past, present or future limited partner, shareholder, other equity
holder, officer, director, employee or controlling person as such, of FelCor LP or of any successor
Person shall have any liability for any obligations of FelCor LP under the Notes or the Indenture
or for any claim based on, in respect of or by reason of, such obligations or their creation. Each
Holder by accepting a Note waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Notes.



17. Authentication.




     This Note shall not be valid until the Trustee or authenticating agent signs the certificate
of authentication on the other side of this Note.



18. Abbreviations.




     Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM
(= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian) and U/G/M/A (= Uniform Gifts to
Minors Act).



     FelCor LP will furnish to any Holder upon written request and without charge a copy of the
Indenture. Requests may be made to FelCor Lodging Limited Partnership, 545 East John Carpenter
Freeway, Suite 1300, Irving, Texas 75062 or at such other address provided for in the Indenture.



19. Guarantee.




     Repayment of principal and interest on the Notes is guaranteed on a senior basis by the
Guarantors pursuant to Article Eleven of the Indenture.



A-8









 





[FORM OF TRANSFER NOTICE]




     FOR VALUE RECEIVED the undersigned registered Holder hereby sell(s), assign(s) and transfer(s)
unto


Insert Taxpayer Identification No.




                                                                  (Please print or
typewrite name and address including
zip code of assignee) the within Note and all rights thereunder, hereby irrevocably constituting
                                                             and appointing                                          attorney to
transfer said Note on the books of FelCor LP with full power of substitution in the premises.



[THE FOLLOWING PROVISION TO BE INCLUDED

ON ALL NOTES OTHER THAN EXCHANGE NOTES,

PERMANENT OFFSHORE GLOBAL NOTES AND

OFFSHORE PHYSICAL NOTES]




     In connection with any transfer of this Note occurring prior to the date which is the earlier
of (i) the date the shelf registration statement with respect to resales of the Notes is declared
effective or (ii) two years after the original issuance of the Notes, the undersigned confirms that
without utilizing any general solicitation or general advertising that:



[Check One]





	[ ]	 	(a) this Note is being transferred in compliance with
the exemption from registration under the Securities Act of
1933, as amended, provided by Rule 144A thereunder.





or





	[ ]	 	(b) this Note is being transferred other than in
accordance with (a) above and documents are being furnished
which comply with the conditions of transfer set forth in this
Note and the Indenture.




If none of the foregoing boxes is checked, the Trustee or other Registrar shall not be obligated to
register this Note in the name of any Person other than the Holder hereof unless and until the
conditions to any such transfer of registration set forth herein and in Section 2.08 of the
Indenture shall have been satisfied.




	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	NOTICE: The signature to this assignment must correspond with the
name as written upon the face of the within-mentioned instrument in
every particular, without alteration or any change whatsoever.






A-9









 




TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.




     The undersigned represents and warrants that it is purchasing this Note for its own account or
an account with respect to which it exercises sole investment discretion and that it and any such
account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities
Act of 1933, as amended, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding FelCor LP as the undersigned has
requested pursuant to Rule 144A or has determined not to request such information and that it is
aware that the transferor is relying upon the undersigned’s foregoing representations in order to
claim the exemption from registration provided by Rule 144A.



	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	NOTICE: To be executed by an executive officer






A-10









 





OPTION OF HOLDER TO ELECT PURCHASE




     If you wish to have this Note purchased by FelCor LP pursuant to Section 4.10 or Section 4.11
of the Indenture, check the Box: o



     If you wish to have a portion of this Note purchased by FelCor LP pursuant to Section
4.10 or Section 4.11 of the Indenture, state the amount (in principal amount at maturity):
$                                        



	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Your Signature:	 	 	 	 
	 	 	 	 	 
	(Sign exactly as your name appears on the other side of this Note)

	 
	 	 	 	 	 	 
	Signature Guarantee:	 	 
	 

	 	 	 	 	 	 





A-11









 





EXHIBIT B




Form of Certificate




                    ,                     




FelCor Lodging Limited Partnership

545 East John Carpenter Freeway

Suite 1300

Irving, Texas 75062




FelCor Lodging Trust Incorporated

545 East John Carpenter Freeway

Suite 1300

Irving, Texas 75062




U.S. Bank National Association

60 Livingston Avenue

EP-MN-WS3C

St. Paul, Minnesota 55107-2292

Attention: Corporate Trust Department




	 	 	 	 	 
	 

	 	Re:
	 	FelCor Lodging Limited Partnership (“FelCor LP”)
	 

	 	 	 	Senior Secured Floating Rate Notes Due 2011 (the “Notes”)






Dear Sirs:




     This letter relates to U.S. $                     principal amount at maturity of Notes represented by
a Note (the “Legended Note”) which bears a legend outlining restrictions upon transfer of such
Legended Note. Pursuant to Section 2.01 of the Indenture (the “Indenture”) dated as of October 31,
2006, relating to the Notes, we hereby certify that we are (or we will hold such securities on
behalf of) a person outside the United States to whom the Notes could be transferred in accordance
with Rule 903 or Rule 904 of Regulation S promulgated under the U.S. Securities Act of 1933, as
amended. Accordingly, you are hereby requested to exchange the legended certificate for an
unlegended certificate representing an identical principal amount at maturity of Notes, all in the
manner provided for in the Indenture.



     You are entitled to rely upon this letter and are irrevocably authorized to produce this
letter or a copy hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby. Terms used in this certificate have
the meanings set forth in Regulation S.



	 	 	 	 	 
	 	 	Very truly yours,
	 	 	[Name of Holder]
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Authorized Signature






B-1









 





EXHIBIT C




Form of Certificate to Be

Delivered in Connection with

Transfers to Non-QIB Accredited Investors




                    , __




FelCor Lodging Limited Partnership

545 East John Carpenter Freeway

Suite 1300

Irving, Texas 75062




FelCor Lodging Trust Incorporated

545 East John Carpenter Freeway

Suite 1300

Irving, Texas 75062




U.S. Bank National Association

60 Livingston Avenue

EP-MN-WS3C

St. Paul, Minnesota 55107-2292

Attention: Corporate Trust Department




	 	 	 	 	 
	 

	 	Re:
	 	FelCor Lodging Limited Partnership (“FelCor LP”)
	 

	 	 	 	Senior Secured Floating Rate Notes Due 2011 (the “Notes”)






Dear Sirs:




     In connection with our proposed purchase of $                     aggregate principal amount at
maturity of the Notes, we confirm that:




     1. We understand that any subsequent transfer of the Notes is subject to certain
restrictions and conditions set forth in the Indenture dated as of October 31, 2006,
relating to the Notes (the “Indenture”) and the undersigned agrees to be bound by, and not
to resell, pledge or otherwise transfer the Notes except in compliance with, such
restrictions and conditions and the Securities Act of 1933, as amended (the “Securities
Act”).




     2. We understand that the offer and sale of the Notes have not been registered under
the Securities Act, and that the Notes may not be offered or sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell any Notes, we will do so only (A)
to FelCor, FelCor LP or any subsidiary thereof, (B) in accordance with Rule 144A under the
Securities Act to a “qualified institutional buyer” (as defined therein), (C) to an
institutional “accredited investor” (as defined below) that, prior to such transfer,
furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you a signed letter
substantially in the form of this letter, and, if this letter relates to a proposed transfer
in respect of an aggregate principal amount of Notes less than $100,000, an opinion of
counsel acceptable to FelCor and FelCor LP that such transfer is in compliance with the
Securities Act, (D) outside the United States in accordance with Rule 904 of Regulation S
under the Securities Act, (E) pursuant to the exemption from registration provided by Rule
144 under the Securities Act (if available), or (F) pursuant to an effective registration
statement under the Securities Act, and we further agree to provide to any person purchasing
any of the Notes from us a notice advising such purchaser that resales of the Notes are
restricted as stated herein.




     3. We understand that, on any proposed resale of any Notes, we will be required to
furnish to you such certifications, legal opinions and other information as you may
reasonably require to confirm



C-1









 







that the proposed sale complies with the foregoing restrictions. We further understand
that the Notes purchased by us will bear a legend to the foregoing effect.




     4. We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2),
(3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience
in financial and business matters as to be capable of evaluating the merits and risks of our
investment in the Notes, and we and any accounts for which we are acting are each able to
bear the economic risk of our or its investment.




     5. We are acquiring the Notes purchased by us for our own account or for one or more
accounts (each of which is an institutional “accredited investor”) as to each of which we
exercise sole investment discretion.



     You are entitled to rely upon this letter and are irrevocably authorized to produce this
letter or a copy hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby.



	 	 	 	 	 
	 	 	Very truly yours,
	 	 	[Name of Transferee]
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Authorized Signature






C-2









 





EXHIBIT D




Form of Certificate To Be Delivered

in Connection with Transfers

Pursuant to Regulation S




                    , ____




FelCor Lodging Limited Partnership

545 East John Carpenter Freeway

Suite 1300

Irving, Texas 75062




FelCor Lodging Trust Incorporated

545 East John Carpenter Freeway

Suite 1300

Irving, Texas 75062




U.S. Bank National Association

60 Livingston Avenue

EP-MN-WS3C

St. Paul, Minnesota 55107-2292

Attention: Corporate Trust Department




	 	 	 	 	 
	 

	 	Re:
	 	FelCor Lodging Limited Partnership (“FelCor LP”)
	 

	 	 	 	Senior Secured Floating Rate Notes Due 2011 (the “Notes”)






Dear Sirs:



     In
connection with our proposed sale of U.S.$___ aggregate principal amount at maturity
of the Notes, we confirm that such sale has been effected pursuant to and in accordance with
Regulation S under the Securities Act of 1933, as amended (the “Securities Act”), and, accordingly,
we represent that:




     (1) the offer of the Notes was not made to a person in the United States;




     (2) at the time the buy order was originated, the transferee was outside the United
States or we and any person acting on our behalf reasonably believed that the transferee was
outside the United States;




     (3) no directed selling efforts have been made by us in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S, as
applicable; and




     (4) the transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act.



     You are entitled to rely upon this letter and are irrevocably authorized to produce this
letter or a copy hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby. Terms used in this certificate have
the meanings set forth in Regulation S.



	 	 	 	 	 
	 	 	Very truly yours,
	 	 	[Name of Transferor]
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Authorized Signature






D-1









 





EXHIBIT E




[Collateral Agency Agreement]




E-1









 





EXHIBIT F




[Pledge Agreement]





F-1