COURTYARD
BY MARRIOTT HOTEL


 


RELICENSING FRANCHISE AGREEMENT


 


BETWEEN


 


MARRIOTT INTERNATIONAL, INC.


 


AND


 


ARC HOSPITALITY TRS BALTIMORE, LLC


 


Location: 1000 Aliceanna Street, Baltimore,
MD 21202


 


Dated as of: March 21, 2014


 




    	 



    	 



    

 


TABLE OF CONTENTS


 


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


 




    	i



    	 



    

 


	9.	OPERATIONS	19
	 	 	 	 
	 	9.1	Operating the Hotel	19
	 	9.2	System Promotion and Diversion to Other Businesses	20
	 	9.3	Employees	20
	 	9.4	Management and Operation of the Hotel	21
	 	 	 	 
	10.	TRAINING, COUNSELING, AND ADVISORY SERVICES	22
	 	 	 	 
	 	10.1	Training	22
	 	10.2	Counseling and Advisory Services	23
	 	 	 	 
	11.	PHYSICAL FACILITIES, SUPPLIES, AND GOODS	23
	 	 	 	 
	 	11.1	Repairs and Maintenance	23
	 	 	 	 
	12.	SYSTEM AND STANDARDS; FRANCHISEE ASSOCIATION	23
	 	 	 	 
	 	12.1	Compliance with System and Standards	23
	 	12.2	Modification of the System and Standards	24
	 	12.3	Franchisee Association	24
	 	 	 	 
	13.	PROPRIETARY MARKS AND INTELLECTUAL PROPERTY	24
	 	 	 	 
	 	13.1	Franchisor’s Representations and Responsibility Regarding the Proprietary Marks	24
	 	13.2	Franchisee’s Use of System and Intellectual Property	25
	 	13.3	Franchisee’s Use of Other Marks	27
	 	13.4	Internet Website	27
	 	 	 	 
	14.	CONFIDENTIAL INFORMATION; DATA PROTECTION LAWS	28
	 	 	 	 
	 	14.1	Confidential Information	28
	 	14.2	Data Protection Laws	28
	 	 	 	 
	15.	ACCOUNTING AND REPORTS	28
	 	 	 	 
	 	15.1	Books, Records, and Accounts	28
	 	15.2	Reports	29
	 	15.3	Franchisor Examination and Audit of Hotel Records	29
	 	 	 	 
	16.	INDEMNIFICATION AND INSURANCE	30
	 	 	 	 
	 	16.1	Indemnification	30
	 	16.2	Insurance	30
	 	 	 	 
	17.	TRANSFERABILITY OF INTERESTS	32
	 	 	 	 
	 	17.1	Transfers of Interests in the Hotel and Franchisee	32
	 	17.2	Transfers of Controlling Ownership Interests	33
	 	17.3	Transfers of Passive Investor Interests, Estate Planning, and Death or Mental Incompetency	35
	 	17.4	Proposed Transfer to Competitor and Right of First Refusal	36
	 	17.5	Interest in Real Estate and Injunctive Relief	38
	 	17.6	Survival of Right of First Refusal	38
	 	17.7	Security Interests in the Hotel or Franchisee	39
	 	17.8	Proposed Transfers to Specially Designated National or Blocked Person	39
	 	17.9	Transfers by Franchisor	39
	 	 	 	 
	18.	PUBLICLY-TRADED SECURITIES AND SECURITIES OFFERINGS	39
	 	 	 	 
	 	18.1	Franchisee’s Obligations	39


 




    	ii



    	 



    

 


	 	18.2	Limited Franchisor Consent	41
	 	 	 	 
	19.	DEFAULT AND TERMINATION	41
	 	 	 	 
	 	19.1	Immediate Termination	41
	 	19.2	Termination Upon Notice with Opportunity to Cure	42
	 	19.3	Termination by Franchisor and Liquidated Damages	43
	 	 	 	 
	20.	POST-TERMINATION	46
	 	 	 	 
	 	20.1	Franchisee Obligations	46
	 	20.2	Franchisor’s Rights Upon Termination or Expiration	48
	 	20.3	Survival	48
	 	 	 	 
	21.	CONDEMNATION AND CASUALTY	48
	 	 	 	 
	 	21.1	Condemnation	48
	 	21.2	Casualty	48
	 	 	 	 
	22.	COMPLIANCE WITH LAWS; LEGAL ACTIONS	49
	 	 		 
	 	22.1	Compliance with Laws	49
	 	22.2	Notice Regarding Legal Actions	49
	 	22.3	WAIVER OF JURY TRIAL AND PUNITIVE DAMAGES	49
	 	22.4	Specially Designated National or Blocked Person; Anti-Money Laundering	50
	 	 	 	 
	23.	RELATIONSHIP OF PARTIES	50
	 	 	 	 
	 	23.1	Reasonable Business Judgment	50
	 	23.2	Independent Contractor	50
	 	 	 	 
	24.	GOVERNING LAW; INJUNCTIVE RELIEF; COSTS OF ENFORCEMENT	50
	 	 	 	 
	 	24.1	Governing Law	50
	 	24.2	Injunctive Relief	51
	 	24.3	Costs of Enforcement	51
	 	 	 	 
	25.	NOTICES	51
	 	 	 	 
	 	25.1	Notices	51
	 	 	 	 
	26.	CONSTRUCTION AND SEVERABILITY; APPROVALS, CONSENTS AND WAIVERS; ENTIRE AGREEMENT	52
	 	 	 	 
	 	26.1	Construction and Severability	52
	 	26.2	Approvals, Consents and Waivers	53
	 	26.3	Entire Agreement	53
	 	26.4	Amendments	53
	 	 	 	 
	27.	REPRESENTATIONS, WARRANTIES AND COVENANTS	54
	 	 	 	 
	 	27.1	Existence and Power; Authorization; Contravention	54
	 	27.2	Ownership of Franchisee	54
	 	27.3	Ownership of the Hotel	54
	 	27.4	Additional Franchisee Acknowledgments and Representations	55
	 	 	 	 
	28.	MISCELLANEOUS	56
	 	 	 	 
	 	28.1	Confidential Negotiated Changes	56
	 	28.2	Multiple Counterparts	56




    	iii



    	 



    

 


	AMENDMENT TO FRANCHISE AGREEMENT  REQUIRED BY THE STATE OF MARYLAND	58
	 	 
	SCHEDULE 1  Courtyard by Marriott BRAND SPECIFIC TERMS	60
	 	 
	EXHIBIT A  APPROVED LOCATION, NUMBER OF GUESTROOMS AND OWNERSHIP INTERESTS IN FRANCHISEE	61
	 	 
	EXHIBIT B  CHANGE OF OWNERSHIP RIDER	62
	 	 
	PROPERTY IMPROVEMENT PLAN ADDENDUM	64
	 	 
	ATTACHMENT ONE  Scope of Work	66
	ATTACHMENT TWO  ADA Certification	69


 




    	iv



    	 



    

  


COURTYARD BY MARRIOTT HOTEL RELICENSING
FRANCHISE AGREEMENT


 


This Courtyard by Marriott
Hotel Relicensing Franchise Agreement is effective as of the 21st day of March, 2014 (“Effective Date”) by Marriott
International, Inc., a Delaware corporation, and ARC Hospitality TRS Baltimore, LLC, a Delaware limited liability company (“Franchisee”).


 


RECITALS:


 


A.           Franchisor
owns the System.


 


B.           HFP
Hotel Owner II, LLC (“Existing Franchisee”) and Franchisor are parties to a System Hotel franchise agreement (“Existing
Franchise Agreement”) for the operation of the Hotel (defined below).


 


C.           Pursuant
to an Agreement of Purchase and Sale dated January 30, 2014 (“Purchase Agreement”), ARC Hospitality Baltimore, LLC,
a Delaware limited liability company (“Owner”), an Affiliate of Franchisee, has purchased the Hotel from Existing Franchisee
(the “Hotel Purchase Transaction”).


 


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


 


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


 


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


 


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


 


H.           The
Hotel opened for business as a System Hotel on December 15, 2000 (the “Opening Date”), and was operated under Franchisor’s
System from the Opening Date until termination of the Existing Franchise Agreement pursuant to the Termination Agreement.


 


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


 


J.           Franchisee
has entered into a lease dated March 21, 2014 (the “Lease”) with Owner, pursuant to which Owner has leased the Hotel
to Franchisee and Franchisee has rights to operate the Hotel.


 


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


 


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


 




    	 



    	 



    

 


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


 


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


 


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


 


		1.	DEFINITIONS



 


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


 


“AAA Rules”
has the meaning stated in Section 17.4.


 


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


 


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


 


“Agreement”
means this Courtyard by Marriott Hotel Relicensing Franchise Agreement, including any exhibits, attachments, and addenda.


 


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


 


“Application
Fee” has the meaning stated in Schedule 1.


 


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


 


“Arbitrator”
has the meaning stated in Section 17.4.


 


“Association”
has the meaning stated in Section 12.3.


 


“Brand”
has the meaning stated in the definition of “Competitor.”


 


“Brand Change”
has the meaning stated in Section 21.2.


 


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


 


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


 




    	2



    	 



    

 


“Competitor”
means any Person that owns or has an interest in a hotel brand, trade name, trademark, system, or chain (a “Brand”)
or any Person that has, directly or indirectly, an Ownership Interest in, or is an Affiliate, principal, director, officer, or
other individual with management responsibility of, a Person that owns or has an interest in a Brand that is comprised of at least
(i) twenty (20) full-service hotels, or (ii) fifty (50) limited-service hotels. For the purposes of defining “Competitor,”
“full-service” hotels are hotels that typically offer three (3) meals per day and have an average of three thousand
(3,000) square feet or more of meeting space per hotel, and “limited-service” hotels are hotels that are not “full-service”
hotels. No Person will be deemed to be a Competitor if such Person has an interest in a Brand merely as a franchisee or as a mere
passive investor that has no Control or influence over the business decisions concerning the Brand at issue, such as limited partners
in a partnership or as a mere non-Controlling stockholder in a corporation.


 


“Competitor
Liquidated Damages” has the meaning stated in Section 19.3.C.


 


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


 


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


 


“Control Affiliate”
means an Affiliate of Franchisee that directly or indirectly Controls Franchisee.


 


“Data Protection
Laws” means data protection and privacy laws and regulations in the United States.


 


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


 


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


 


“Effective
Date” has the meaning stated in the preamble to this Agreement.


 


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


 


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


 




    	3



    	 



    

 


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


 


“Existing
Franchise Agreement” has the meaning stated in the Recitals.


 


“Existing
Franchisee” has the meaning stated in the Recitals.


 


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


 


“Financed
Pool” has the meaning stated in Section 5.2.


 


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


 


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


 


“Franchisee”
has the meaning stated in the preamble to this Agreement.


 


“Franchise
Fees” has the meaning stated in Schedule 1.


 


“Franchisor”
means Marriott International, Inc., a Delaware corporation, and its successors and assigns.


 


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


 


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


 




    	4



    	 



    

 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


“Hotel Purchase
Transaction” has the meaning stated in the Recitals.


 


“Initial Accounting
Period” has the meaning stated in Section 3.11.


 




    	5



    	 



    

 


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


 


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


 


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


 


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


 


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


 


“Lease”
has the meaning stated in the Recitals.


 


“Lender”
means any Person that (a) is in the business of originating and making loans (as opposed to buying loans) as its primary business,
including private lenders and any Person chartered as a state or federal bank, thrift, or savings and loan, and insured by the
FDIC or FSLIC, and (b) is not a Competitor or an Affiliate of a Competitor.


 


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


 


“Management
Company” has the meaning stated in Section 9.4.A.


 


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


 


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


 


“Marketing
Fund Charge” has the meaning stated in Schedule 1.


 




    	6



    	 



    

 


“Marketing
Funds” means monies collected and used by Franchisor and its Affiliates for Marketing Fund Activities.


 


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


 


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


 


“Opening Date”
has the meaning stated in the Recitals.


 


“Other Lodging
Product” has the meaning stated in Section 21.2.


 


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


 


“Owner”
has the meaning stated in the Recitals.


 


“Owner Agreement”
has the meaning stated in the Recitals.


 


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


 


“Passive Investor
Interests” has the meaning stated in Section 17.3.


 


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


 


“PIP”
has the meaning stated in Section 17.2.A(1)(d).


 


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


 


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


 


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


 




    	7



    	 



    

 


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


 


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


 


“Purchase
Agreement” has the meaning stated in the Recitals.


 


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


 


“Reasonable
Business Judgment” has the meaning stated in Section 23.1.


 


“Registered
Shares” means authorized securities of an entity registered with the United States Securities and Exchange Commission
pursuant to a registration statement under the federal securities laws.


 


“Renovation
Drawings” has the meaning stated in Section 6.2.A.


 


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


 


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


 


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


 


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


 


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


 


“Special Circumstances”
has the meaning stated in Section 19.3.B.


 


“Special Circumstances
Liquidated Damages” has the meaning stated in Section 19.3.B.


 




    	8



    	 



    

 


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


 


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


 


“Standards”
means Franchisor’s operating rules, manuals, standard operating procedures and other procedures, systems, guides, programs
(including the Quality Assurance Program), requirements, directives, standards, specifications, design criteria, and such other
information, initiatives and controls that are necessary for planning, designing, constructing, renovating, refurbishing, and operating
System Hotels (including the Design Criteria), as such may be modified, amended or supplemented by Franchisor or its Affiliates
in accordance with Section 12.2 (and which may, with Franchisor’s prior approval, take into account specific characteristics
and conditions of the local market). The Standards may be in paper or in electronic form.


 


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


 


“System Hotel”
has the meaning stated in Schedule 1.


 


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


 


“Term”
has the meaning stated in Section 4.1.


 


“Term Expiration
Date” has the meaning stated in Section 21.2.


 


“Termination
Agreement” has the meaning stated in the Recitals.


 


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


 


“Transfer
Fee” has the meaning stated in Section 17.2.A(1)(c).


 


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


 




    	9



    	 



    

 


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


 


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


 


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


 


		2.	LICENSE



 


		2.1	Limited Grant.



 


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


 


		2.2	Franchisor’s Reserved Rights.



 


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


 


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


 


		3.	FEES



 


		3.1	Application Fee.



 


Before the execution
of this Agreement, Franchisee has paid to Franchisor the Application Fee as set forth in Schedule 1 in consideration of Franchisor’s
investigation, review and approval process and other administrative functions and undertakings in connection with this Agreement.
The Application Fee was earned by Franchisor upon Franchisor’s conditional approval of Franchisee’s application and
is non-refundable.


 




    	10



    	 



    

 


		3.2	Franchise Fees.



 


Franchisee must pay to
Franchisor the Franchise Fees as set forth in Schedule 1 during each Accounting Period. Franchisee must not discount or sacrifice
Gross Room Sales (by methods including the offering of complimentary or reduced-price rooms) in order to further any other
business at or outside of the Hotel. Gross Room Sales must be accounted for on an accrual basis.


 


		3.3	Marketing Fund Charges; Special Marketing Program
Fees.



 


A.           Franchisee
must pay to Franchisor the Marketing Fund Charge as set forth in Schedule 1 as the Hotel’s contribution for Marketing Fund
Activities. All sums Franchisor receives under this Section 3.3.A will be used as described in Section 7.3. Franchisor may modify
the Marketing Fund Charge for hotels in the System, including the Hotel, to reflect the following, as determined by Franchisor:
(i) any increase or decrease in the cost of providing, or the scope of, Marketing Fund Activities; (ii) any change in the method
used to allocate the cost of Marketing Fund Activities; or (iii) any change in the competitive needs of the System. Franchisee
agrees to be bound by any such increase or decrease; provided the total Marketing Fund Charge in any fiscal year will not exceed
the maximum amount specified in Schedule 1. System Hotels operated by Franchisor will make contributions for Marketing Fund Activities
at the same percentage of Gross Room Sales required of franchisees within the System.


 


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


 


		3.4	Electronic Systems Fees.



 


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


 


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


 


		3.5	Other Charges.



 


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


 




    	11



    	 



    

 


		3.6	Travel Expenses and Reimbursement.



 


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


 


		3.7	Marriott Agreement Payments.



 


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


 


		3.8	Making of Payments and Performance of Services.



 


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


 


		3.9	Interest on Late Payments.



 


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


 


		3.10	Taxes.



 


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


 


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


 




    	12



    	 



    

 


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


 


		4.	TERM



 


		4.1	Term.



 


The term of this Agreement
begins on the Effective Date and expires on January 31, 2027 (the “Term”).


 


		4.2	Not Renewable.



 


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


 


		5.	SIZE, FINANCING, CONSTRUCTION, AND RENOVATION



 


		5.1	Size.



 


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


 


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


 


		5.2	Financing of the Hotel.



 


Franchisee will not,
and will cause each Interestholder in Franchisee to not, incur or replace any indebtedness that is secured by a lien on or mortgage
of the Hotel or the revenues of the Hotel or pledge of Ownership Interests in Franchisee (whether such indebtedness is incurred
(i) individually on behalf of the Hotel or (ii) on a pooled basis with other hotels or legal entities (a “Financed Pool”))
unless the following conditions are met at the time the indebtedness is incurred or replaced: (1) the indebtedness is with
a Lender; (2) the terms of such indebtedness are consistent with prevailing commercial practices of Lenders at that time in the
country in which the Hotel is located; and (3) there is no violation of Section 17.7 of this Agreement. Franchisee will give notice
to Franchisor of the component hotels and legal entities in a Financed Pool before incurring such indebtedness.


 




    	13



    	 



    

 


		5.3	Construction/Conversion/Renovation of the Hotel.



 


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


 


		6.	SOURCING AND DESIGN APPROVALS



 


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



 


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


 


B.           The
requirements of this Section 6.1 are to ensure that items used at System Hotels will be uniform and of high quality to maintain
the identity, integrity and reputation of the System. If Franchisee proposes to purchase or lease any signs, FF&E, Inventories,
Fixed Asset Supplies or other items not previously approved by Franchisor as meeting the Standards, or from a supplier or manufacturer
that Franchisor has not previously approved, Franchisee and such supplier or manufacturer will submit to Franchisor, at no cost
to Franchisor, sufficient specifications and other information and samples for Franchisor to determine whether such items meet
the Standards. Franchisor may require payment of an amount not to exceed the cost of such inspection, and Franchisor will not be
liable for damage to any sample. Franchisor may require such supplier or manufacturer to demonstrate to Franchisor’s satisfaction
that such supplier and/or manufacturer: (i) can manufacture such products to specifications that meet the Standards; (ii) can deliver
them in a timely manner and in sufficient quantities to meet the needs of the Hotel; and (iii) has insurance protecting Franchisor
and its Affiliates against any relevant claims. If the proposed arrangement involves the supplying or manufacturing of products
utilizing Franchisor’s Intellectual Property, Franchisor may also require the supplier or manufacturer to: (a) enter into
a written agreement with Franchisor concerning the use of Franchisor’s Intellectual Property on terms acceptable to Franchisor;
and (b) demonstrate to Franchisor’s satisfaction that it can comply with the terms of such agreement. Franchisor may revoke
its approval as to future purchases if the supplier or manufacturer at any time after such approval fails to meet the requirements
of this Section 6.1 or the Standards.


  




    	14



    	 



    

 


		6.2	Design Approval.



 


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


 


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


 


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


 


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


 


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


 




    	15



    	 



    

 


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



 


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



 


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


 


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


 


		7.2	Reservations, Pricing, and Rates.



 


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


 


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


 




    	16



    	 



    

 


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


 


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


 


		7.3	Marketing Fund Activities.



 


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


 


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


 


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


 


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


 




    	17



    	 



    

 


		7.4	Special Marketing Programs.



 


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


 


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



 


		8.1	Systems Installation.



 


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


 


		8.2	Reservation System.



 


Franchisor will make
the Reservation System available to the Hotel, provided if Franchisee is in breach of this Agreement and if such breach is not
cured within the time period required for cure of such breach under this Agreement, Franchisor may, in addition to any other remedies
it may have, suspend the Hotel from using the Reservation System for so long as such breach remains uncured. Franchisee waives
all claims against Franchisor and its Affiliates arising from Franchisee’s suspension from the Reservation System under this
Section 8.2, other than claims that Franchisee is not in breach of this Agreement. Franchisee will cause the Hotel to participate
in the Reservation System, will use the Reservation System only for the benefit of the Hotel, and will comply with all Standards
related to participation.


 


		8.3	Optional System(s).



 


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


 


		8.4	System Communication Costs.



 


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


 




    	18



    	 



    

 


		8.5	Electronic Systems Provided Under License.



 


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


 


		9.	OPERATIONS



 


		9.1	Operating the Hotel.



 


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


 


(1)         permit
the duly authorized representatives of Franchisor to: (i) enter Franchisee’s facilities and inspect same at all reasonable
times to confirm that Franchisee is complying with the terms of this Agreement and the Standards; and (ii) test any and all
equipment, food products, and supplies located at the Hotel. Franchisee may be required to pay any costs related to such inspections
and provide free lodging to any such inspector or inspectors on official duty for such time as may be reasonably necessary;


 


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


 


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


 


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


 


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


 




    	19



    	 



    

 


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


 


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


 


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


 


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


 


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


 


		9.2	System Promotion and Diversion to Other Businesses.



 


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


 


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


 


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


 


(2)         any
other business or concession.


 


		9.3	Employees.



 


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


 




    	20



    	 



    

 


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


 


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


 


		9.4	Management and Operation of the Hotel.



 


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


 


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


 




    	21



    	 



    

 


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


 


D.           Notwithstanding
anything to the contrary set forth in this Agreement, the Management Company Acknowledgment and/or Franchisor’s Quality Assurance
Program, if, during the Term of this Agreement, the Hotel is placed in the Yellow Zone for any two consecutive tracking periods
or in the Red Zone for any single tracking period under Franchisor’s Quality Assurance Program, then Franchisor may require,
in its sole discretion, Franchisee to replace the Management Company with another management company that has been approved by
Franchisor to operate the Hotel; provided, however, Franchisor shall not require such replacement pursuant to this Section 9.4.D.
so long as Crestline Hotels & Resorts, LLC is the Management Company. Such replacement shall occur within sixty (60) days from
the receipt by Franchisee (or first refusal of delivery) of a written notice by Franchisor advising Franchisee that it must replace
the Management Company. If Franchisee fails to replace Management Company in accordance with the terms of this Section 9.4.D, then
Franchisee shall be in material default under this Agreement. For purposes of this Section 9.4.D, the terms “Yellow Zone”
and “Red Zone” refer to the “Yellow Zone” and the “Red Zone” (or any comparable replacement
terms) as such terms are used in Franchisor’s Quality Assurance Program.


 


		10.	TRAINING, COUNSELING, AND ADVISORY SERVICES



 


		10.1	Training.



 


A.           The
Hotel must be managed by an individual or individuals who have timely and successfully completed the training program(s) required
by Franchisor. Franchisor will have the right to require that the Hotel’s or Franchisee’s management personnel attend
or complete specific training program(s), including before the opening or conversion of the Hotel or in connection with a Transfer
of Control of Franchisee or the Hotel. Such training courses will be conducted at such time and place as Franchisor will designate.
Franchisee will advise Franchisor of all newly hired management personnel within thirty (30) days after they commence employment,
and such personnel will attend and successfully complete such training program(s) within the time frame Franchisor specifies.


 


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


 


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


 


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


 




    	22



    	 



    

 


		10.2	Counseling and Advisory Services.



 


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


 


		11.	PHYSICAL FACILITIES, SUPPLIES, AND GOODS



 


		11.1	Repairs and Maintenance.



 


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


 


B.           Franchisee
must complete a significant renovation of Guestrooms, Guestroom corridors and Public Facilities, including (i) replacement of Soft
Goods at least every five (5) to six (6) years after the date such Soft Goods were installed and (ii) replacement of Case Goods
at least every ten (10) to twelve (12) years after the date such Case Goods were installed; provided, however earlier or more frequent
renovations or replacements may be necessary to maintain the quality level of the Hotel in compliance with the Standards and to
comply with the Quality Assurance Program. In connection with replacements in the immediately preceding sentence, the replacement
of all Soft Goods or all Case Goods, as the case may be, will be done at the same time rather than being done in a piecemeal fashion
or in phases. If Franchisee cannot demonstrate the date of installation of Soft Goods or Case Goods, Franchisor will determine
the date of installation for purposes of the first sentence of this Section 11.1.B after consultation with Franchisee.


 


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


 


		12.	SYSTEM AND STANDARDS; FRANCHISEE ASSOCIATION



 


		12.1	Compliance with System and Standards.



 


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


 




    	23



    	 



    

 


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


 


		12.2	Modification of the System and Standards.



 


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


 


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


 


		12.3	Franchisee Association.



 


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


 


		13.	PROPRIETARY MARKS AND INTELLECTUAL PROPERTY



 


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



 


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


 


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


 


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


 


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


 




    	24



    	 



    

 


		13.2	Franchisee’s Use of System and Intellectual
Property.



 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 




    	25



    	 



    

 


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


 


B.           Franchisee
agrees that:


 


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


 


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


 


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


 


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


 


(5)         Franchisee
has no Ownership Interest in the System. Franchisee’s use of the Intellectual Property and other aspects of the System under
this Agreement (including any modifications, derivatives or additions thereto proposed by or on behalf of Franchisee or its Affiliates)
will not give Franchisee any Ownership Interest or other interest in or to the Intellectual Property or any other aspect of the
System, except the nonexclusive license granted by this Agreement. Franchisee hereby assigns (and will cause each of its employees
or independent contractors who contributed to such modifications, derivatives or additions to assign) to Franchisor, in perpetuity
throughout the world, all rights, title and interest (including the entire copyright and all renewals, reversions and extensions
thereof) in and to all modifications, derivatives and additions to the Intellectual Property and other aspects of the System proposed
by or on behalf of Franchisee or its Affiliates. Franchisee waives (and will cause each of its employees or independent contractors
who contributed to such modifications, derivatives or additions to waive) all “moral rights of authors” or any similar
rights that Franchisee (or its employees or independent contractors) may now or hereafter have in the modifications, derivatives
and additions to the Intellectual Property and other aspects of the System proposed by or on behalf of Franchisee or its Affiliates.
Franchisee agrees to execute (or cause to be executed) and deliver to Franchisor any documents and to do any acts that may be deemed
necessary by Franchisor to perfect or protect the title in the modifications, derivatives or additions herein conveyed, or intended
to be conveyed now or in the future;


 




    	26



    	 



    

 


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


 


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


 


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


 


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


 


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


 


		13.3	Franchisee’s Use of Other Marks.



 


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


 


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


 


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


 


		13.4	Internet Website.



 


A.           With
the exception of a website that describes Franchisee’s franchise relationship with Franchisor and as stated in this Section
13.4 or the Standards, Franchisee will not display the Proprietary Marks on or associate the System with (through a link or otherwise)
any website, electronic Marketing Materials, domain name, address, designation, or listing on the Internet or other communication
system without the express consent of Franchisor. If Franchisor permits Franchisee to display or use the Proprietary Marks on Franchisee’s
Internet site, the form, content and appearance of Franchisee’s Internet site, and any modifications thereto, must comply
with the Standards and be approved by Franchisor before it is posted on the Internet so that Franchisor can maintain the common
identity of the System Hotels and the Proprietary Marks.


 


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


 




    	27



    	 



    

 


		14.	CONFIDENTIAL INFORMATION; DATA PROTECTION LAWS



 


		14.1	Confidential Information.



 


Franchisee will not,
during the Term or thereafter, without Franchisor’s prior consent, which consent may be granted or withheld in Franchisor’s
sole discretion, copy, duplicate, record, reproduce, in whole or in part, or otherwise transmit or make available to any “unauthorized”
Person any Confidential Information. Franchisee may divulge such Confidential Information only (a) to such of Franchisee’s
and/or Management Company’s employees or agents as require access to it in order to operate the Hotel, and only if such employees
or agents are apprised of the confidential nature of such information before it is divulged to them and they are bound by confidentiality
obligations substantially similar to those listed above, and (b) to the extent required by law or judicial proceeding; provided
that Franchisee will provide Franchisor with prompt prior written notice so that Franchisor may seek a protective order or other
appropriate remedy or waive compliance with the provisions of this Agreement, and provided further that, in the event that Franchisor
is unable to obtain such protective order or other appropriate remedy in connection with a third party’s request for disclosure,
Franchisee will: (i) furnish only that portion of the Confidential Information that Franchisee is advised by counsel is legally
required by Applicable Law, (ii) give Franchisor written notice of the information to be disclosed as far in advance as practicable,
and (iii) exercise reasonable efforts to obtain a protective order or other reliable assurance that confidential treatment will
be accorded the Confidential Information so disclosed. All other Persons are “unauthorized” for purposes of this Agreement.
Franchisee agrees that the Confidential Information has commercial value and that Franchisor and its Affiliates have taken reasonable
measures to maintain its confidentiality, and, as such, the Confidential Information is proprietary and a trade secret of Franchisor
and its Affiliates. Franchisee will be liable to Franchisor for any breaches of the confidentiality obligations in this Section 14.1
by its employees and agents. Franchisee will maintain the Confidential Information in a safe and secure location and will immediately
report to Franchisor the theft or loss of all or any part of the Confidential Information.


 


		14.2	Data Protection Laws.



 


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


 


		15.	ACCOUNTING AND REPORTS



 


		15.1	Books, Records, and Accounts.



 


Franchisee at its expense
must maintain and preserve for the Hotel for at least five (5) years from the dates of their preparation, complete and accurate
books, records, and accounts in accordance with the Uniform System and United States generally accepted accounting principles,
consistently applied, Applicable Law and the Standards. Franchisee’s obligation to preserve such books, records and accounts
will survive the expiration or termination of this Agreement.


 




    	28



    	 



    

 


		15.2	Reports.



 


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


 


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


 


		15.3	Franchisor Examination and Audit of Hotel Records.



 


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


 


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


 


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


 




    	29



    	 



    

 


		16.	INDEMNIFICATION AND INSURANCE



 


		16.1	Indemnification.



 


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


 


		16.2	Insurance.



 


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


 


(1)         Property
Insurance


 


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


 


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


 


(c)          If
the Hotel is located in whole or in part within an area identified by the federal government as having a special flood hazard,
flood insurance in an amount not less than the maximum coverage available under the National Flood Insurance Program and excess
flood coverage with reasonable limits, but in no event less than ten percent (10%) of the full replacement cost of the Hotel building
and contents, including business interruption coverage in an amount not less than that set forth in Section 16.2.A(1)(b).


 




    	30



    	 



    

 


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


 


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


 


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


 


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


 


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


 


(6)         Umbrella
Excess Liability on a following form in excess of the liability insurance required under subsections A(2) through (5) immediately
above in not less than the amount set forth opposite the number of stories in height that the Hotel is above ground as set forth
in Schedule 1. Such coverage will apply in total to the Hotel only by specific endorsement. Franchisor will have the right to require
Franchisee to increase the amount of coverage if, in Franchisor’s Reasonable Business Judgment, such an increase is warranted.


 


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


 


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


 


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


 


(1)         All
insurance under subsection A(1)(b) of this Section will name Franchisor as a loss payee as their interest may appear, and all insurance
under subsections A(3) through (6) of this Section will by endorsement specifically name as unrestricted additional insureds Franchisor,
any Affiliate of Franchisor designated by Franchisor, and their employees and agents. All insurance required hereunder will be
specifically endorsed to provide that the coverages will be primary and that any insurance carried by any additional insured will
be excess and non-contributory.


 




    	31



    	 



    

 


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


 


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


 


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


 


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


 


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


 


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


 


		17.	TRANSFERABILITY OF INTERESTS



 


		17.1	Transfers of Interests in the Hotel and Franchisee.



 


Franchisee agrees that
its rights and duties in this Agreement are personal to Franchisee, and that Franchisor entered into this Agreement in reliance
on the business skill, financial capacity, and character of Franchisee and its principals and Affiliates. A Transfer of any Ownership
Interest in Franchisee, the Hotel or any Ownership Interest in the Hotel, any of Franchisee’s rights or obligations under
this Agreement, or a Transfer of, or change of Control in, Franchisee or a Control Affiliate is prohibited without the prior written
consent of Franchisor except as otherwise set forth in Sections 17 or 18. Upon Franchisor’s request, Franchisee will furnish
Franchisor with a list of the names and addresses of the Interestholders in Franchisee and any Control Affiliate (other than (i)
holders of Ownership Interests that are publicly-traded and were purchased on the open market; and (ii) the holders of Registered
Shares), unless disclosure of such Interestholders is required pursuant to Section 17.2, Section 17.3 or Section 17.4.


 




    	32



    	 



    

 


		17.2	Transfers of Controlling Ownership Interests.



 


A.           Except
as set forth elsewhere in Sections 17 and 18, if Franchisee or any Interestholder of Franchisee or a Control Affiliate wishes to
Transfer the Hotel, its Ownership Interest in the Hotel, a direct or indirect Controlling Ownership Interest in Franchisee, or
effect a transaction that otherwise results in a direct or indirect change of Control in Franchisee, Franchisee will provide notice
of such proposed Transfer to Franchisor. The notice will state the full name and identity of all of the parties to the proposed
Transfer, including Interestholders of such parties and the terms of the Transfer, together with all other related information
that is reasonably requested by Franchisor. Prior Transfers of Ownership Interests by or to the same Person or an Affiliate of
such Person will be considered in determining whether a Transfer of a Controlling Ownership Interest or change of Control has occurred.
For purposes of determining whether a Transfer of a Controlling Ownership Interest or change of Control has occurred: (i) a Transfer
of securities in Franchisee or any entity that directly or indirectly Controls Franchisee as a result of a sale of Registered Shares
shall not constitute a Transfer of Control or a Transfer of a Controlling interest in such entity, so long as no individual or
entity or group (within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, and related rules and
regulations), directly or indirectly, has beneficial ownership of more than fifteen percent (15%) of the outstanding amount of
such securities after the later of (i) completion of such sale; or (ii) the date that is six (6) months after the Effective Date
(it being understood that during the first six months of the Term, the initial sales of Registered Shares may result in Persons
owning greater than a 15% interest, but such interest percentage will be diluted to below 15% within six months); and, (ii) a dilution
in the equity ownership of AR Capital, LLC (or its subsidiary) in the ownership structure of American Realty Capital Hospitality
Trust, Inc. will not be deemed a Transfer of a Controlling Ownership Interest or change of Control in Franchisee for purposes of
this Section 17.2.A. so long as (x) the Advisory Agreement (as amended from time to time), dated as of January 7, 2014, among American
Realty Hospitality Trust, Inc., as the company, American Realty Capital Hospitality Operating Partnership, L.P., as the operating
partnership, and American Realty Capital Hospitality Advisors, LLC, as advisors, remains in effect, and (y) American Realty Capital
Hospitality Advisors, LLC is indirectly controlled by AR Capital, LLC; provided that any termination of such Advisory Agreement,
or any changes thereto that decrease the material obligations of American Realty Capital Hospitality Advisors, LLC thereunder will
be deemed a Transfer of a Controlling Ownership Interest or change of Control in Franchisee for purposes of this Section 17.2.A.
Within thirty (30) days after Franchisor receives the notice and information required under this Section 17.2.A, Franchisor will
notify Franchisee of Franchisor’s election of one of the following two alternatives:


 


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


 


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


 


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


 


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


 




    	33



    	 



    

 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 




    	34



    	 



    

 


C.           Subject
to Sections 17.4 and 17.8 and compliance with the conditions set forth in Section 17.2.A(1)(a), (b), (e), (f), (g), (h) and (i),
Franchisor will consent to a Transfer of the Hotel or Franchisee’s Ownership Interests in the Hotel or the Ownership Interests
in Franchisee or a Control Affiliate to a Person (a) in which Franchisee has a Controlling Ownership Interest and in which Franchisee
owns, directly or indirectly, at least 50% of the economic interests or (b) in which the Interestholder that Controls Franchisee
has a Controlling Ownership Interest and in which the Interestholder that Controls Franchisee owns, directly or indirectly, at
least 50% of the economic interests, in either case provided that: (i) Franchisor is provided at least thirty (30) days advance
written notice of such Transfer; (ii) Franchisee provides to Franchisor documentation acceptable to Franchisor evidencing the Transfer
by which such Person expressly assumes the obligations of Franchisee hereunder and under each other Marriott Agreement; (iii) another
party acceptable to Franchisor has executed a guaranty substantially identical to the form of guaranty set forth in the then-current
Franchise Disclosure Document (which party may be Franchisee or the transferee depending on the structure of the transaction) and
each and every Guarantor acknowledges the Transfer and reaffirms and ratifies its obligations under the Guaranty; (iv) Franchisee
is not in breach or default under any of the Marriott Agreements; (v) the Hotel is in good standing under the Quality Assurance
Program; and (vi) each beneficial owner of an Ownership Interest in such Person shall have passed Franchisor’s then-current
owner screen and paid any applicable fees in connection therewith.


 


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



 


A.           Subject
to Sections 17.4 and 17.8, Transfers of direct or indirect, non-Controlling Ownership Interests (“Passive Investor Interests”)
will be consented to by Franchisor if the following conditions are met: (a) the Passive Investor Interests are not owned by a Guarantor;
(b) such Transfer(s), individually and in the aggregate, will not effect (i) a Transfer of or change in direct or indirect Control
of Franchisee or the Hotel (in which case, the provisions of Section 17.2 will apply) or (ii) a Transfer of a majority of the Passive
Investor Interests; (c) Franchisee provides Franchisor notice of such Transfer at least twenty (20) days prior to the consummation
of such Transfer, together with reasonably detailed information concerning the identity and background of any such transferee and
its Interestholders and the structure of such Transfer, and a representation and warranty that such information is true, correct
and complete and that the requirements of this Section 17.3.A are met; and (d) Franchisee pays the then-current fee for
background checks for any such transferee and its Interestholders and such background checks reveal that (x) each such Person has
not been convicted of a felony, (y) each such Person is not otherwise known to have violated the law, and (z) each such Person’s
character and reputation otherwise complies with the Standards. If requested by Franchisor, Franchisee will execute an amendment
to this Agreement that updates the information on Exhibit A regarding the ownership of Franchisee to reflect the ownership after
the Transfer. Franchisor will have the right to require that Franchisee pay Franchisor’s outside counsel costs in connection
with any such Transfer. For clarity, Franchisee shall have no obligations under this Section 17.3.A with respect to Transfers of
Passive Investor Interests that are also Transfers of Registered Shares, provided that if such Transfers are subject to Section
17.2, then the terms of that Section will govern such Transfers.


 


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


 




    	35



    	 



    

 


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


 


		17.4	Proposed Transfer to Competitor and Right of First
Refusal.



 


A.           If
there is a proposed Transfer to a Competitor of (i) the Hotel (or any interest therein), (ii) Franchisee’s Ownership Interest
in this Agreement, or (iii) an Ownership Interest or other interest in either Franchisee or a Control Affiliate (but excluding
any Transfer of Registered Shares so long as such Transfer(s), individually and in the aggregate, will not effect a Transfer of
or change in indirect or indirect Control of Franchisee or the Hotel). Franchisee will give notice thereof to Franchisor, stating
the full name and identity of the prospective purchaser or tenant, as the case may be, including the names and addresses of the
Interestholders of such prospective purchaser or tenant, the price or rental and all other terms of such proposed transaction,
together with all other related information that is reasonably requested by Franchisor. Within thirty (30) days after receipt by
Franchisor of such notice and information from Franchisee, Franchisor will notify Franchisee of Franchisor’s election, made
in its sole discretion, of one (1) of the immediately following four (4) alternatives:


 


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


 


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


 


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


 




    	36



    	 



    

 


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


 


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


 


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


 


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


 


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


 




    	37



    	 



    

 


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


 


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


 


		17.5	Interest in Real Estate and Injunctive Relief.



 


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


 


		17.6	Survival of Right of First Refusal.



 


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


 


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


 


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


 




    	38



    	 



    

 


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


 


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


 


		17.7	Security Interests in the Hotel or Franchisee.



 


In connection with any
financing benefiting the Hotel or otherwise with respect to the Hotel, Franchisee will not, and will not allow any Person to, mortgage,
grant a security interest in, or otherwise pledge as collateral the Hotel, the revenues of the Hotel, or an Ownership Interest
in Franchisee or in a Person Controlling Franchisee unless such financing meets the requirements of Section 5.2 or Franchisor otherwise
consents to such financing in writing. Franchisee may not assign, mortgage, or grant a security interest in, or pledge as collateral,
this Agreement. Franchisor has no obligation to provide a “comfort letter” in connection with, or consent to, a transaction
that would be prohibited by this Section 17.7. If a lender forecloses on, or otherwise exercises its rights against the Hotel,
the revenues of the Hotel, or such Ownership Interests, or Franchisee violates this Section 17.7, Franchisor will have the rights
under Section 19.1. Franchisor has no obligation to license a lender or any Person acting on behalf of a lender, including
a receiver or servicer of a loan, unless that obligation arises from a valid and binding written agreement between Franchisor and
a lender.


 


		17.8	Proposed Transfers to Specially Designated National
or Blocked Person.



 


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


 


		17.9	Transfers by Franchisor.



 


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


 


		18.	PUBLICLY-TRADED SECURITIES AND SECURITIES OFFERINGS



 


		18.1	Franchisee’s Obligations.



 


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


 




    	39



    	 



    

 


B.           Without
limiting Franchisor’s rights under Section 17.2, in connection with any Transfer of Ownership Interests in Franchisee or
a Control Affiliate involving any proposed public or private offering of securities that uses in any way the Proprietary Marks,
identifies the Hotel, Franchisor or its Affiliates, or discusses the relationship between Franchisor or its Affiliates and Franchisee
or its Affiliates, Franchisee must also (except as provided in Section 18.1.D):


 


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


 


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


 


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


 


(4)         submit
to Franchisor for its review at least thirty (30) days before the earliest of the date on which any Prospectus is delivered to
a potential investor or filed with the Securities and Exchange Commission or any other governmental authority responsible for the
regulation of the sale of securities, a copy of the proposed Prospectus, all supporting and related materials and releases. Franchisor,
in its sole discretion, may require Franchisee to pay for its costs and expenses in performing the limited review of the proposed
Prospectus in accordance with this Section 18, including attorneys’ fees and expenses.


 


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


 


D.           Franchisee
hereby represents, warrants, and covenants that its current Prospectus complies, and any future Prospectus will comply, with Applicable
Law. Based on such representation, warranty and covenant, Franchisor waives the requirement for representations and consent pursuant
to Section 18.1.B(1), for approval of the use of Proprietary Marks pursuant to Section 18.1.B(3), and for review of a Prospectus
pursuant to Section 18.1.B(4), in each case if such Prospectus: (i) only uses the Marks in block letters with the designation “®”
and only to identify the Hotel, (ii) provides a clear statement in connection with such use that the Hotel is operated under a
license from Franchisor, and (iii) further provides that Franchisor has not reviewed, authorized, or endorsed the offering or Prospectus
and Franchisor is not involved in any way, whether as an “issuer” or “underwriter” or otherwise, in the
offering or Prospectus.


 




    	40



    	 



    

 


		18.2	Limited Franchisor Consent.



 


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


 


		19.	DEFAULT AND TERMINATION



 


		19.1	Immediate Termination.



 


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


 


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


 


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


 


C.           a
court of competent jurisdiction enters an order, judgment, or decree, on the application of a creditor, adjudicating Franchisee
or any Guarantor as bankrupt, insolvent, or similar status or approving a petition seeking reorganization or appointing a receiver,
trustee, or liquidator of all or a substantial part of Franchisee’s or any Guarantor’s assets, and such order, judgment,
or decree remains unstayed and in effect for a period of ninety (90) days or will be consented to by Franchisee or such Guarantor;
or


 


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


 


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


 


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


 




    	41



    	 



    

 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


N.           Franchisee
or Owner is in default under the Lease or Owner Agreement beyond all applicable notice and cure periods, or if the Lease or Owner
Agreement is terminated for any reason.


 


		19.2	Termination Upon Notice with Opportunity to Cure.



 


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


 




    	42



    	 



    

 


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


 


B.           Franchisee
and its Affiliates fail to pay any indebtedness to Franchisor or any of its Affiliates when same becomes due and payable or Guarantor
is in breach of any of its obligations under the Guaranty; or


 


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


 


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


 


		19.3	Termination by Franchisor and Liquidated Damages.



 


A.           Franchisee
has agreed to operate the Hotel as a System Hotel in compliance with this Agreement for the Term. If Franchisee should fail to
do so, Franchisee acknowledges and agrees that Franchisor would be damaged in several ways, including loss of future Franchise
Fees and Marketing Fund Charges and injury to the goodwill in the Proprietary Marks. Franchisee acknowledges and agrees that it
is difficult to estimate the revenues of the Hotel over a period of years and that elements of Franchisor’s damages not directly
calculated from the Hotel’s revenues are inherently difficult to calculate and the proofs thereof would be burdensome and
costly (although such damages are real and meaningful to Franchisor and the System). Franchisor and Franchisee agree that liquidated
damages (calculated as set forth in this Section 19.3) are not a penalty and represent a reasonable estimate of just and fair compensation
of Franchisor for the damages that it would suffer if Franchisee should fail to operate the Hotel as a System Hotel in compliance
with this Agreement for the Term. Upon termination of this Agreement under this Section 19, Franchisee will promptly pay to Franchisor
liquidated damages in an amount equal to (i) the average monthly Franchise Fees and Marketing Fund Charges payable to Franchisor
during the previous two (2) years times (ii) the lesser of (x) thirty-six (36) or (y) one-half (1/2) the number of months
that would then otherwise remain in the Term. If the Hotel has not opened with the approval of Franchisor or has not been operating
as a System Hotel pursuant to a franchise agreement for at least two (2) years (whether pursuant to this Agreement or a franchise
agreement between Franchisor and a previous franchisee), the following will be used instead of clause (i) in the above calculation:
the greater of (a) the average monthly Franchise Fees and Marketing Fund Charges payable to Franchisor for the previous two (2)
years for all United States System Hotels on a per room basis times the number of rooms at the Hotel or (b) the average
monthly Franchise Fees and Marketing Fund Charges payable for the Hotel for the period during which the Hotel was opened as a System
Hotel; provided that if either party believes that such calculation would not be representative of the projected stabilized performance
of the Hotel, the party will notify the other in writing and clause (i) in the above calculation of liquidated damages will be
recalculated by multiplying the projected stabilized revenue for the Hotel submitted by Franchisee in its franchise application
by the highest percentage rates used to calculate Marketing Fund Charges and any component of Franchise Fees in this Agreement.


 




    	43



    	 



    

 


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


 


	 	 	2 
Agreements
 Terminated	 	3-4 
Agreements
 Terminated	 	 	5-8 
Agreements
 Terminated	 	 	9-15 
Agreements
 Terminated	 	 	16 –25 
Agreements
 Terminated	 	 	>26 
Agreements
 Terminated	 
	5 or More Agreements For Franchisor Lodging Facilities Are Terminated	 	N/A	 	 	N/A	 	 	 	125	%	 	 	175	%	 	 	200	%	 	 	300	%
	3 or More Agreements For Franchisor Lodging Facilities In Same State Are Terminated	 	N/A	 	 	125	%	 	 	150	%	 	 	200	%	 	 	250	%	 	 	300	%
	3 or More Agreements For Franchisor Lodging Facilities in Top 20% of Room Count, Franchise Fees or GSS Score for Relevant System Are Terminated	 	N/A	 	 	125	%	 	 	150	%	 	 	200	%	 	 	250	%	 	 	300	%



 




    	44



    	 



    

 


	 	 	2 
Agreements
 Terminated	 	 	3-4 
Agreements
 Terminated	 	 	5-8 
Agreements
 Terminated	 	 	9-15 
Agreements
 Terminated	 	 	16 –25 
Agreements
 Terminated	 	 	>26 
Agreements
 Terminated	 
	3 or More Agreements For Franchisor Lodging Facilities in Same Metropolitan Statistical Area Are Terminated	 	 	N/A	 	 	 	175	%	 	 	250	%	 	 	300	%	 	 	300	%	 	 	300	%
	2 or More Agreements For Franchisor Lodging Facilities With Over 400 Guestrooms that are the Major Group Representation in a Secondary or Tertiary Market Are Terminated	 	 	150	%	 	 	175	%	 	 	250	%	 	 	300	%	 	 	300	%	 	 	300	%
	2 or More Agreements For Franchisor Lodging Facilities Resorts or Hotels for Which at Least 50% of Guests are Leisure Travelers Are Terminated	 	 	150	%	 	 	175	%	 	 	250	%	 	 	300	%	 	 	300	%	 	 	300	%
	2 or More Agreements For JW Marriott Hotels Are Terminated	 	 	150	%	 	 	175	%	 	 	250	%	 	 	300	%	 	 	300	%	 	 	300	%



 




    	45



    	 



    

 


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


 


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


 


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


 


		20.	POST-TERMINATION



 


		20.1	Franchisee Obligations.



 


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


 


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


 


(2)         Franchisee
will immediately and permanently cease to use and remove from the Hotel and any other place of business any Intellectual Property
and any other identifying characteristics and marks of the System, including any Electronic Systems, signs, fixtures, furniture,
furnishings, equipment, advertising materials, stationery, supplies, forms, or other articles that display any Proprietary Marks
or any trade dress or other distinctive features or designs associated with Franchisor or the System. Any signs containing any
Proprietary Marks that Franchisee is unable to remove from the Hotel despite its best efforts upon termination or expiration of
this Agreement will be completely covered by Franchisee from view and physically removed within twenty-four (24) hours after termination
or expiration. Franchisee also will immediately remove all content regarding Franchisor, the System, and the Proprietary Marks
from any Internet sites under its control and will take all necessary actions required by Franchisor to disassociate itself from
Franchisor on the Internet. Franchisee will, at Franchisor’s option, cancel or assign to Franchisor or its designee, any
domain name owned by or under the control of Franchisee or its Affiliates that contains any Proprietary Mark, or any mark that
is in Franchisor’s sole opinion confusingly similar, including misspellings and acronyms;


 




    	46



    	 



    

 


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


 


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


 


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


 


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


 


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


 


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


 




    	47



    	 



    

 


		20.2	Franchisor’s Rights Upon Termination or Expiration.



 


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


 


		20.3	Survival.



 


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


 


		21.	CONDEMNATION AND CASUALTY



 


		21.1	Condemnation.



 


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


 


		21.2	Casualty.



 


If the Hotel is damaged
or destroyed by fire or other cause and such damage or destruction is substantial and material, affecting over forty percent (40%)
of the Hotel, and necessitates the closing of the Hotel for a period in excess of one hundred and fifty (150) days, Franchisee
will have the right to terminate this Agreement upon notice to Franchisor given within one hundred and fifty (150) days of such
closing of the Hotel if it elects not to repair or rebuild the Hotel. Franchisee will not be required to pay Franchisor the liquidated
damages due under Section 19.3 in connection with such termination if such casualty is the sole basis for termination of this Agreement
and Franchisee executes and delivers to Franchisor a termination agreement and release in form and substance acceptable to Franchisor;
provided, however, if subsequent to such notice and before the date on which the Term would otherwise have ended under Section
4 if such notice of termination had not been given (the “Term Expiration Date”), Franchisee or any of its Affiliates
or any Interestholder in Franchisee with an Ownership Interest of twenty percent (20%) or greater operates a hotel; vacation, timesharing,
interval or fractional ownership facility; condominium; apartment; or other lodging product at the Approved Location (the “Other
Lodging Product”), which Other Lodging Product is not operated under a license or franchise from Franchisor or one of its
Affiliates (a “Brand Change”), then in such event, Franchisee will be obligated to promptly pay to Franchisor an amount
equal to the applicable liquidated damages set forth in Section 19.3, but clause (ii) in the calculation of liquidated damages
in Section 19.3 will be the lesser of (a) thirty-six (36) or (b) one-half (1/2) the number of months then remaining between (x)
the date upon which the Other Lodging Product is first operated, and (y) the Term Expiration Date. Franchisee’s obligation
set forth in this Section 21.2 will survive termination of this Agreement. If the Hotel does not close for one hundred and fifty
(150) days or Franchisee does not elect to terminate this Agreement in accordance with the provisions of this Section 21.2, the
Hotel will be promptly renovated and reopened within a reasonable time in accordance with the System and pursuant to plans and
specifications approved by Franchisor in accordance with Section 6.2. If, after Franchisee has requested consent from Franchisor
to re-open the Hotel as a System Hotel and Franchisor does not consent to such re-opening of the Hotel as a System Hotel, a Brand
Change occurs, then Franchisee will not be obligated to pay liquidated damages pursuant to this Section 21.2.


 




    	48



    	 



    

 


		22.	COMPLIANCE WITH LAWS; LEGAL ACTIONS



 


		22.1	Compliance with Laws.



 


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


 


		22.2	Notice Regarding Legal Actions.



 


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


 


		22.3	WAIVER OF JURY TRIAL AND PUNITIVE DAMAGES.



 


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


 




    	49



    	 



    

 


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



 


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


 


		23.	RELATIONSHIP OF PARTIES



 


		23.1	Reasonable Business Judgment.



 


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


 


		23.2	Independent Contractor.



 


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


 


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


 


		24.	GOVERNING LAW; INJUNCTIVE RELIEF; COSTS OF ENFORCEMENT



 


		24.1	Governing Law.



 


A.           This
Agreement takes effect upon its acceptance and execution by Franchisor in the State of Maryland, United States of America, and
will be interpreted and construed under the laws thereof, which laws will prevail in the event of any conflict of law. Nothing
in this Section 24.1 is intended, or will be deemed, to make the Maryland Franchise Registration and Disclosure Law apply to this
Agreement, or the transactions or relationships contemplated hereby, if such law otherwise would not be applicable.


 




    	50



    	 



    

 


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


 


		24.2	Injunctive Relief.



 


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


 


		24.3	Costs of Enforcement.



 


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


 


		25.	NOTICES



 


		25.1	Notices.



 


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


 


	 	To Franchisor:	Marriott International, Inc.
	 	 	10400 Fernwood Road
	 	 	Bethesda, MD 20817
	 	 	Attn:  Law Department 52/923.27
	 	 	 
	 	with a copy to:	Marriott International, Inc.
	 	 	10400 Fernwood Road
	 	 	Bethesda, MD 20817
	 	 	Attn:  Vice President, Owner and Franchise Services
	 	 	Department 51/926.19
	 	 	 
	 	To Franchisee:	ARC Hospitality TRS Baltimore, LLC
	 	 	405 Park Avenue
	 	 	New York, NY  10022
	 	 	Attn:  Jesse C. Galloway
	 	 	Email: jgalloway@arlcap.com


 




    	51



    	 



    

 


	 	with a copy to:	Crestline Hotels & Resorts, LLC
	 	 	3950 University Drive, Suite 301
	 	 	Fairfax, VA 22030
	 	 	Attn:  President & CEO/General Counsel
	 	 	james.carroll@crestlinehotels.com
	 	 	and
	 	 	pierre.donahue@crestlinehotels.com


 


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


 


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


 


		26.	CONSTRUCTION AND SEVERABILITY; APPROVALS, CONSENTS
AND WAIVERS; ENTIRE AGREEMENT



 


		26.1	Construction and Severability.



 


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


 


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


 


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


 


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


 


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


 




    	52



    	 



    

 


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


 


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


 


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


 


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


 


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


 


		26.2	Approvals, Consents and Waivers.



 


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


 


		26.3	Entire Agreement.



 


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


 


		26.4	Amendments.



 


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


 




    	53



    	 



    

 


		27.	REPRESENTATIONS, WARRANTIES AND COVENANTS



 


		27.1	Existence and Power; Authorization; Contravention.



 


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


 


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


 


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


 


		27.2	Ownership of Franchisee.



 


Franchisee represents
and warrants to Franchisor that Franchisee is owned directly and indirectly as set forth on Exhibit A. Upon the request of Franchisor,
Franchisee will submit to Franchisor evidence, in form and substance satisfactory to Franchisor, confirming that Franchisee is
owned directly and indirectly as set forth on Exhibit A (but without the obligation to disclose information about the owners of
Registered Shares except as required by Section 17).


 


		27.3	Ownership of the Hotel.



 


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


 




    	54



    	 



    

 


		27.4	Additional Franchisee Acknowledgments and Representations.



 


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


 


B.           FRANCHISEE
AGREES THAT THE BUSINESS VENTURE CONTEMPLATED BY THIS AGREEMENT INVOLVES SUBSTANTIAL BUSINESS RISKS, IS A VENTURE WITH WHICH FRANCHISEE
IS FAMILIAR AND HAS RELEVANT EXPERIENCE AND ITS SUCCESS WILL BE LARGELY DEPENDENT UPON THE ABILITY OF FRANCHISEE AS AN INDEPENDENT
BUSINESS. FRANCHISOR EXPRESSLY DISCLAIMS THE MAKING OF, AND FRANCHISEE AGREES FRANCHISEE HAS NOT RECEIVED, ANY INFORMATION, WARRANTY
OR GUARANTEE, EXPRESS OR IMPLIED, AS TO THE POTENTIAL VOLUME, PROFITS, OR SUCCESS OF THE BUSINESS VENTURE CONTEMPLATED BY THIS
AGREEMENT. If Franchisor furnishes advice, consultation, training, OR other forms of assistance
in connection with the Hotel OR THE APPROVED LOCATION with regard to matters such as financing, design, construction, renovation,
menu planning, operation and management of the Hotel, Franchisor does not guarantee or assure the success or satisfactory result
of such matters and Franchisor will not thereby incur any liability or be responsible in any way for any error, omission or failure
of whatever nature in such financing, design, construction, renovation, menu planning, operation or management of the Hotel OR
THE APPROVED LOCATION.


 


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


 


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


 




    	55



    	 



    

 


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


 


		28.	MISCELLANEOUS



 


		28.1	Confidential Negotiated Changes.



 


Franchisee acknowledges
and agrees that the terms of this Agreement and all exhibits, attachments or addenda or other agreements ancillary to, or executed
in connection with this agreement, that have been negotiated (“negotiated terms”) from the standard form of agreements
set forth in the Franchise Disclosure Document referred to in Section 27.4.C are strictly confidential and Franchisee will not
disclose such negotiated terms to any Person without the prior consent of Franchisor except (1) as required by law, (2) as
may be necessary to enforce this Agreement in any legal proceedings, or (3) to those of Franchisee’s managers, members,
officers, directors, employees, attorneys, accountants, agents or lenders as is necessary for the operation or financing of the
Hotel. It will be a material default hereunder if Franchisee, its managers, members, officers, directors, employees, attorneys,
accountants, agents or lenders disclose the negotiated terms to any unauthorized Person without the prior consent of Franchisor.


 


		28.2	Multiple Counterparts.



 


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


 


{Signatures appear on the following page}


 




    	56



    	 



    

 


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


 


	 	 	FRANCHISOR:
	 	 	 	 
	ATTEST:	 	MARRIOTT INTERNATIONAL, INC.
	 	 	 	 
	/s/ David Manderscheid	 	By:	/s/ Kevin M. Kimball (SEAL)
	Assistant Secretary	 	Name: Kevin M. Kimball
	 	 	Title: Vice President


 


	 	FRANCHISEE:
	 	 
	WITNESS:	ARC HOSPITALITY TRS BALTIMORE, LLC
	 	a Delaware limited liability company


 


	 	 	By: 	ARC Hospitality TRS Holding, LLC, its sole
	 	 	 	member
	 	 	 	 
	 	 	 	By:	American Realty Capital Hospitality
	 	 	 	 	Operating Partnership, L.P.,
	 	 	 	 	its sole member
	 	 	 	 	 
	 	 	 	 	By:	American Realty Capital Hospitality
	 	 	 	 	 	Trust, Inc.,
	 	 	 	 	 	its general partner
	 	 	 	 	 	 
	/s/ Jaclyn Cheyne	 	 	 	 	By:	/s/ Jesse C. Galloway(SEAL)
	Witness	 	 	 	 	Name: Jesse C. Galloway
	 	 	 	 	 	Title: Authorized Signatory


 




    	57



    	 



    

 


AMENDMENT TO FRANCHISE AGREEMENT






REQUIRED BY THE STATE OF MARYLAND


 


In recognition of the
requirements of the Maryland Franchise Registration and Disclosure Law, the parties to the attached FRANCHISE AGREEMENT (the “Agreement”)
agree as follows:


 


1.          Section
17.2.A(1)(b) of the Agreement shall be deleted in its entirety, and shall have no force or effect, and the following shall be substituted
in lieu thereof:


 


(b) Franchisee
must satisfy all of its accrued monetary obligations to Franchisor and its Affiliates, including an amount equal to a reasonable
estimate of the costs and fees related to the period on and before the date of such Transfer, whether or not yet accrued and/or
invoiced, and will execute, in a form prescribed by Franchisor, a general release of any and all claims against Franchisor and
its Affiliates, and their respective officers, directors, agents and employees; excluding only such claims as Franchisee may have
that have arisen under the Maryland Franchise Registration and Disclosure Law to the extent, if any, that a release of such claims
would be prohibited under the Maryland Franchise Registration and Disclosure Law at the time the release is provided;


 


2.          Section
27.4 of the Agreement, under the heading “Additional Franchisee Acknowledgments and Representations,” shall be supplemented
by the following:


 


F.           The
foregoing acknowledgments are not intended to nor shall they act as a release, estoppel or waiver of any liability under the Maryland
Franchise Registration and Disclosure Law.


 


3.          Each
provision of this Amendment to the Agreement shall be effective only to the extent that the jurisdictional requirements of the
Maryland Franchise Registration and Disclosure Law are met independently with respect to each such provision and without reference
to this Amendment to the Agreement.


 


4.          Franchisor
reserves the right to challenge the applicability of any law that declares provisions in the Agreement void or unenforceable.


 


{Signatures appear
on following page}


 




    	58



    	 



    

 


IN WITNESS WHEREOF,
the parties hereto have duly executed and delivered this Amendment to the Agreement, under seal, as of the day and year first
above written in the Agreement.


 


	 	 	FRANCHISOR:
	 	 	 	 
	ATTEST:	 	MARRIOTT INTERNATIONAL, INC.
	 	 	 	 
	/s/ David Manderscheid	 	By:	/s/ Kevin M. Kimball (SEAL)
	Assistant Secretary	 	Name: Kevin M. Kimball
	 	 	Title: Vice President


 


	 	FRANCHISEE:
	 	 
	WITNESS:	ARC HOSPITALITY TRS BALTIMORE, LLC
	 	a Delaware limited liability company


 


	 	 	By: 	ARC Hospitality TRS Holding, LLC, its sole
	 	 	 	member
	 	 	 	 
	 	 	 	By:	American Realty Capital Hospitality
	 	 	 	 	Operating Partnership, L.P.,
	 	 	 	 	its sole member
	 	 	 	 	 
	 	 	 	 	By:	American Realty Capital Hospitality
	 	 	 	 	 	Trust, Inc.,
	 	 	 	 	 	its general partner
	 	 	 	 	 	 
	/s/ Jaclyn Cheyne	 	 	 	 	By:	/s/ Jesse C. Galloway(SEAL)
	Witness	 	 	 	 	Name: Jesse C. Galloway
	 	 	 	 	 	Title: Authorized Signatory


 




    	59



    	 



    

 


SCHEDULE 1


 


Courtyard
by Marriott BRAND SPECIFIC TERMS


 


The following additional
terms and provisions and modifications to the Agreement will apply, which are an integral part of the Agreement:


 


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


 


2.          The
“Application Fee” payable pursuant to Section 3.1 means: One Hundred Two Thousand Five Hundred Dollars ($102,500).


 


3.          The
“Franchise Fees” payable pursuant to Section 3.2 in respect of any Accounting Period means five and one-half percent
(5.5%) of Gross Room Sales for such Accounting Period.


 


4.          The
“Marketing Fund Charge” payable pursuant to Section 3.3 in respect of any Accounting Period is currently two percent
(2%) of Gross Room Sales for such Accounting Period. Franchisee agrees to be bound by any increase or decrease in the Marketing
Fund Charge as specified in Section 3.3; provided the total Marketing Fund Charge in any fiscal year will not exceed three percent
(3%) of Gross Room Sales.


 


5.          The
Umbrella Excess Liability amount required by Section 16.2.A(6) is as follows:


 


	Number of Stories

Hotel is Above

Ground	 	 	Umbrellas Excess

Liability Amount	 
	 	 	 	 	 	 	 
	 	5 or less	 	 	$	14,000,000	 
	 	6	 	 	$	19,000,000	 
	 	7	 	 	$	24,000,000	 
	 	8	 	 	$	34,000,000	 
	 	9	 	 	$	39,000,000	 
	 	10 to 14	 	 	$	49,000,000	 
	 	15	 	 	$	99,000,000	 



 




    	60



    	 



    

 


EXHIBIT A


 


APPROVED LOCATION, NUMBER OF GUESTROOMS
AND

OWNERSHIP INTERESTS IN FRANCHISEE


 


		1.	Approved Location of the Hotel:



 


			1000 Aliceanna Street, Baltimore, MD 21202



 


		2.	Approved Number of Guestrooms:



 


			205



 


		3.	Name of Entity That Will Operate the Hotel:



 


			Crestline Hotels & Resorts, LLC



 


		4.	Ownership Interest(s) in Franchisee:



 


{Remainder of page
intentionally left blank}


 




    	61



    	 



    

 


EXHIBIT B


 


CHANGE OF OWNERSHIP RIDER


 


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


 


		1.	Section 2.1 is hereby amended by inserting the following
sentence at the beginning of such Section:



 


“On
or before the Effective Date, Franchisee has (i) caused Existing Franchisee to deliver to Franchisor the Termination Agreement
duly executed by all parties thereto other than Franchisor and (ii) paid Franchisor’s outside legal counsel fees and expenses
incurred in connection with the review, preparation and negotiation of this Agreement and ancillary documents related thereto.”


 


		2.	Section 3 is hereby amended by adding a new Section 3.11
at the end of such Section, which reads as follows:



 


“3.11         Initial
Accounting Period Charges.


 


Franchisee
agrees that, except for amounts due pursuant to Sections 3.2 or 3.3.A above, if the Effective Date is not the first day of an Accounting
Period then, for the Accounting Period in which the Effective Date occurs (the “Initial Accounting Period”), Franchisee
must pay to Franchisor all amounts due to Franchisor or its Affiliates with respect to the operation of the Hotel for the entire
Initial Accounting Period as though the term of this Agreement had begun on the first day of the Initial Accounting Period, and
that any dispute between Franchisee and Existing Franchisee concerning the allocation of payments for the Initial Accounting Period
will be no defense to Franchisee’s obligations pursuant to this Section 3.11.”


 


		3.	Section 27.4 is hereby amended by adding the following
new Paragraphs F and G after Paragraph E:



 


“F.           FRANCHISEE
ACKNOWLEDGES THAT FRANCHISOR (i) DID NOT ENDORSE, RECOMMEND, OR OTHERWISE CONCUR WITH THE TERMS OF ANY TRANSACTION PURSUANT TO
WHICH FRANCHISEE MAY HAVE ACQUIRED THE RIGHT TO OPERATE THE HOTEL FROM A PRIOR FRANCHISEE OF FRANCHISOR; (ii) DID NOT PARTICIPATE
IN THE DECISION REGARDING THE PRICE OR COMPENSATION TO BE PAID BY FRANCHISEE TO ANY THIRD PARTY FOR SUCH RIGHT, WHICH DECISION
WAS MADE WITHOUT ANY INTERVENTION, SUPPORT OR PARTICIPATION BY FRANCHISOR; AND (iii) DID NOT COMMENT UPON ANY FINANCIAL PROJECTIONS
SUBMITTED TO FRANCHISEE BY OR ON BEHALF OF ANY PRIOR FRANCHISEE.


 


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


 




    	62



    	 



    

 


		4.	Franchisee agrees to upgrade and renovate the Hotel at
the Approved Location in accordance with the terms and provisions set forth in the immediately following Property Improvement
Plan Addendum in order for Franchisee to use the System and continue to operate the Hotel as a System Hotel.



 


{Remainder of page
intentionally left blank}


 




    	63



    	 



    

 


PROPERTY IMPROVEMENT PLAN ADDENDUM


 


		1.	Scope of Work; Drawings and Specifications.



 


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


 


B.           If
any material changes to the Hotel occur after September 13, 2013 but before completion of the Scope of Work, then the Hotel will
be subject to reinspection by Franchisor (“Material Change Review”) and Franchisor reserves the right to modify the
Scope of Work, including by adding additional requirements to the Scope of Work, to address the material changes to the Hotel and
Franchisee agrees that it will be required to complete the requirements in the modified Scope of Work to Franchisor’s satisfaction
in the time period required by Franchisor, in addition to the other requirements in this Property Improvement Plan Addendum. Franchisee
must cooperate fully, and must cause its contractor and subcontractors to cooperate fully, with any inspections conducted by Franchisor
pursuant to a Material Change Review. If a Material Change Review is performed, Franchisor reserves the right to charge Franchisee
its then-current fee for such reinspection.


 


C.           Intentionally
Omitted.


 


D.           Intentionally
Omitted.


 


E.           Intentionally
Omitted.


 


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


 


		2.	Renovation of the Hotel.



 


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


 




    	64



    	 



    

 


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


 


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


 


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


 


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


 


F.           Franchisee
must, upon the completion of the work, provide to Franchisor a written certificate or opinion from its architect, licensed professional
engineer, or recognized expert consultant on the Americans with Disabilities Act stating either: (i) that the Hotel conforms to
and complies with the requirements of the Americans with Disabilities Act and all other related or similar state and local laws,
regulations and other requirements governing public accommodations for persons with disabilities (collectively, “Accessibility
Laws”); or (ii) that none of the work set forth in the Scope of Work modifies any portion of the Hotel that affects the Hotel’s
compliance with any Accessibility Laws. The certificate or opinion will be in the form attached to this Change of Ownership Rider
as Attachment Two.


 


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


 


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


 


{Remainder of page
intentionally left blank}


 




    	65



    	 



    

 


ATTACHMENT
ONE


 


Scope
of Work


 


All items must
be completed within twelve (12) months of the Effective Date (the “PIP Completion Date”), unless otherwise noted with
respect to a particular item.


 


		A.	ADA Certification Requirement



 


The attached ADA Certification (see Attachment Two)
must be completed and submitted to Franchisor by the PIP Completion Date.


 


		B.	Property Internet Standards (Details available on
Marriott Global Source (MGS)). To be completed within two (2) months of the Effective Date:



 


1.          Provide
wireless internet access (Wi-Fi) in all guestrooms.


2.          Meet
or exceed minimum bandwidth requirements based on hotel type and size.


3.          Contract
with certified property internet provider.


4.          Implement
the Global Property Network Standards (GPNS) technical solution.


 


		
	C.           Site
Entrance/Porte Cochere



 


Power-wash underside of canopy at main building entrance.


 


		
	D.           Reception/Lounge



 


1.          Replace
non-standard walk-off mat.


2.          Touch
up existing decorative stained woodwork.


3.          Remove
existing trash receptacles from lobby.


4.          Replace
painted wood cap on knee wall next to welcome pedestal with stone or other hard, durable material.


 


		E.	S-Bar, Cafe Dining, Communal Table & Media
Pods



 


Remove wall outlets from previous TV location above
media pods and repair surface.


 


		F.	Back of House/Kitchen



 


Provide solid flat, finished shelving in linen storage
rooms.


 


		G.	Terrace



 


Replace strap furniture that was not replaced during
recent renovation.


 


		H.	Meeting Room/Board Room



 


Repair base of millwork cabinets around refrigerator
at service counter.


 


		I.	Public Restrooms



 


1.          Repaint
entry door trim and frames.


 




    	66



    	 



    

 


2.          Replace
damaged or corroded bathroom accessories (i.e. soap dispenser, toilet paper holder, etc.)


3.          Replace
any damaged or stained acoustical ceiling tiles and grid.


4.          Replace
light fixtures in restrooms near swimming pool.


 


		J.	Guest Laundry



 


1.          Install
artwork.


2.          Install
a 4' millwork counter and clothes hanging rod.


 


		K.	Indoor Pool



 


1.          Provide
new towel cabinet.


2.          Provide
new storage cabinet for pool supplies (i.e. first aid kit, water testing kit, etc.).






		L.	Guestrooms



 


1.          Provide
new washable decorative pillow.


2.          Touch-up
Case Goods to "like new" condition.


 


		M.	Engineering/Fire Protection/Life Safety



 


This project has been surveyed
with the understanding that the work performed in this building meets the definition for a “renovation” (defined as
refinishing, replacement, bracing, strengthening, or upgrading of existing materials, elements, equipment, or fixtures without
involving the reconfiguration of spaces). If any other work in the building is performed, such as reconfiguration, change of use,
additions, etc., Marriott Fire Protection must be contacted for a reassessment of the fire and life safety requirements.


 


The following items must be completed
to meet Franchisor’s Standards and NFPA standards in the noted timeframe. The fire protection and life safety systems must
be inspected and tested by Marriott Fire Protection once completed:


 


To be completed
within thirty (30) days of Effective Date:


 


		1.	Chain (or cable) and padlock all sprinkler system
control valves located in public spaces (stairwells or egress corridors).



 


		2.	Install placards on all sprinkler system valves that
indicate the valve type, function, and area served. This shall include the valves in the fire pump room, and if the valves are
in cabinets or behind access panels, these covers shall also have a placard installed to identify the valves location.



 


		3.	Replace the corroded sprinkler heads in the fitness
room, pool entryway and in the fitness room with corrosion resistant quick response sprinkler heads.



 


		4.	Install an exit sign perpendicular to the wall at
the door leading from the 4th floor exterior pool deck to the # 1 stair enclosure, so that an exit sign can be seen
from the exterior pool deck sitting area.



 




    	67



    	 



    

 


		5.	Provide 44” of clear egress path in the back
of house exit corridors behind the A and B meeting rooms, as well as in the corridor from the service elevator by the linen chute
terminus to the hotel laundry. It may be helpful to demarcate the 44” path with black and yellow safety tape on the floor.



 


To be completed
within one hundred eighty (180) days of Effective Date:


 


		6.	Install strobe light warning devices in the 419 and
425 meeting rooms as these are utilized as assembly space.



 


		7.	Provide documentation that the emergency generator
has been re-certified. Certification in Franchisee’s possession that is dated no earlier than one hundred and eighty (180)
days prior to the Effective Date is sufficient.



 


		8.	Provide a test and balance report certifying that
stairwell pressurization system meets the requirements of NFPA 101 - The Life Safety Code. NFPA 101 requires 15 lbs. to release
the door hatch, 30 lbs. to set the door in motion and 15 lbs. to open the door to required width. The stair pressurization system
must have a pressure difference across the barrier of not less than .05 in. water column.



 


{Remainder of page intentionally left
blank}


 




    	68



    	 



    

 


ATTACHMENT
TWO


 


ADA Certification


 


(to be completed
by Franchisee’s architect, engineer,


ADA consultant,
or other licensed professional)


 


In connection with
the [NAME AND LOCATION OF HOTEL] (the “Hotel”), I hereby represent and certify to [FRANCHISEE] and to Marriott International,
Inc. that:


 


			[For an “historic hotel” insert: The Hotel [is eligible for listing in the National
Register of Historic Places under the National Historic Preservation Act] [has been designated as historic under State or local
law] [is a qualified historic building under the Uniform Federal Accessibility Standards] (an “historic hotel”);]



 


I have used
professionally reasonable efforts to ensure that the Hotel conforms to and complies with the requirements of the Americans with
Disabilities Act (“ADA”) [For an “historic hotel” insert: as applicable to an historic hotel], and
all other related or similar state and local laws, regulations, and other requirements governing public accommodations for persons
with disabilities in effect at the time that this certification is made; and


 


			In my professional judgment, the Hotel does in fact conform to and comply with such requirements.



 


	 	By:	 	 
	 	 	 	 
	 	Print Name:	 	 
	 	 	 	 
	 	Firm:	 	 
	 	 	 	 
	 	Date:	 	 


 




    	69



    	 



    

 


GUARANTY


 


This Guaranty (“Guaranty”)
is executed as of March 21, 2014, by AR Capital, LLC and American Realty Capital Hospitality Trust, Inc. (jointly and severally,
“Guarantor”), in favor of and for the benefit of Marriott International, Inc., a Delaware corporation (“Franchisor”).
In consideration of and as an inducement to Franchisor to execute the Courtyard by Marriott Hotel Relicensing Franchise Agreement
dated as of March 21, 2014 (as such agreement may be amended, supplemented, restated or otherwise modified, the “Agreement”),
by and between Franchisor and ARC Hospitality TRS Baltimore, LLC, a Delaware limited liability company (“Franchisee”),
Guarantor hereby agrees as follows:


 


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


 


2.          Upon
default by Franchisee and notice from Franchisor to Guarantor (“Guarantor’s Notice”), which Guarantor’s
Notice will give Guarantor no less than ten (10) days to make any required payment and no less than thirty (30) days to perform
any other obligation, Guarantor will make each payment and perform each obligation required by Franchisee under the Agreement and
any other Marriott Agreement. Franchisor may extend, modify or release any indebtedness or obligation of Franchisee, or settle,
adjust or compromise any claims against Franchisee without notice to Guarantor and any such action will not affect the obligations
of Guarantor under this Guaranty. Guarantor hereby waives notice of any amendment, supplement, restatement or other modification
of the Agreement and any other Marriott Agreement and notice of demand for payment or performance by Franchisee. Guarantor’s
guarantee hereunder will extend to any extension or renewal of the Agreement and any other Marriott Agreement.


 


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


 




    	 



    	 



    

 


4.          This
Guaranty constitutes a guaranty of payment and performance and not of collection, and Guarantor specifically waives any obligation
of Franchisor to proceed against Franchisee on any money or property held by Franchisee or by any other Person as collateral security,
by way of set-off or otherwise or against any other guarantor. Guarantor further agrees that this Guaranty will continue to be
effective or be reinstated as the case may be, if at any time payment of any of the guaranteed obligations is rescinded or must
otherwise be restored or returned by Franchisor upon the insolvency, bankruptcy or reorganization of Franchisee or Guarantor, all
as though such payment has not been made.


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 




    	2



    	 



    

 


12.         At all times
during the Term of the Agreement, at least one (1) of the Guarantors must maintain a Net Worth (as hereinafter defined) equal to
or greater than the Minimum Net Worth (as hereinafter defined). If at any time no Guarantor has a Net Worth equal to or greater
than the Minimum Net Worth, then Guarantor will cause a guaranty of payment and performance substantially similar to this Guaranty
(including, without limitation, with terms substantially similar to this Section 12) guaranteeing Franchisee’s obligations
under the Marriott Agreements to be executed by an additional Person (“Successor Guarantor”) acceptable to Franchisor
with a Net Worth equal to or greater than the Minimum Net Worth. In no event will the failure of a Successor Guarantor to execute
and deliver such guaranty, or the execution of such guaranty by a Successor Guarantor, affect the validity and enforceability of
this Guaranty against Guarantor. Franchisor reserves the right to verify that the Net Worth of any actual or prospective Successor
Guarantor is equal to or greater than the Minimum Net Worth, including without limitation by requiring that such Person provide
to Franchisor a certificate of a senior officer of such Person setting out the calculation of such Person’s Net Worth in
reasonable detail, including, but not limited to, a balance sheet, income statement, statement of cash flow and other financial
information regarding such Person as reasonably requested by Franchisor. Each Guarantor will, at its sole cost and expense, provide
to Franchisor within ten (10) days of (i) any request of Franchisor or (ii) a determination by such Guarantor that Guarantor’s
Net Worth is less than the Minimum Net Worth, a certificate of a senior officer of Guarantor setting out the calculation of Guarantor’s
Net Worth in reasonable detail, including, but not limited to, a balance sheet, income statement, statement of cash flow and other
financial information regarding Guarantor as reasonably requested by Franchisor. If at any time Guarantor is in breach of any of
the provisions of this Section 12 beyond the expiration of any cure period given by Franchisor or required by Applicable Law, such
breach will be a material breach under the Agreement for which Franchisor may terminate the Agreement pursuant to Section 19.2.B
thereof. For clarity, Guarantor acknowledges that failure to provide a certificate or supporting financial statements required
by this Section 12 will be deemed a breach of this Section 12.


 


13.         For purposes
of Section 12, this Section 13, and Section 14, the following terms have the following meanings:


 


     “CPI”
means the Consumer Price Index for All Urban Consumers (CPI-U) for the U.S. City Average for All Items, 1982-84=100 published by
the United States Department of Labor, Bureau of Labor Statistics, or, if such index is not at such time so prepared and published,
any comparable index then prepared and published by an agency of the government of the United States selected by Franchisor, appropriately
adjusted for changes in the manner in which such index is prepared and/or the year upon which such index is based.


 


      “GAAP”
means United States generally accepted accounting principles, consistently applied.


 


       “Minimum
Net Worth” means a Net Worth, calculated under the definition of Net Worth, equal to (i) Ten Million Dollars ($10,000,000)
times (ii) the number of Portfolio Hotels of the applicable Guarantor as of the date of such calculation, as such product is adjusted
on January 1 of each year for any changes in the CPI.


 


       “Net Worth”
means, at any time, all assets of such Person (other than intangible assets and any indebtedness of Franchisee to such Person)
minus all liabilities of such Person calculated in accordance with GAAP (provided that, in no event will any unfunded capital commitments
be included in the calculation of Net Worth).


 




    	3



    	 



    

 


“Portfolio
Hotel” means a Franchisor Lodging Facility (other than the Hotel) that is directly or indirectly franchised or owned by,
or the franchise or license agreement of which is guaranteed by, a Guarantor or any of its direct or indirect subsidiaries; provided,
however, that a hotel shall not cease to be a Portfolio Hotel if (i) it is Transferred in violation of the applicable franchise
agreement for such hotel, or (ii) in the event that the applicable franchise agreement for such hotel is terminated, until Franchisor
determines that the applicable outgoing franchisee has satisfied: (a) all known, monetary amounts due to Franchisor that accrued
on or prior to the date of such termination; and (b) all post-termination obligations as they relate to effecting a smooth transition
of such hotel between owners and/or franchisees.


 


14.         AR
Capital, LLC, may request that Franchisor issue a written release that releases AR Capital, LLC from its obligations under this
Guaranty, and upon such request, Franchisor will execute such a release, subject to the following terms and conditions: (i) Franchisee
provides documentation in the form of a certificate of a senior officer of American Realty Capital Hospitality Trust, Inc. (the
“REIT”) setting out the calculation of the REIT’s Net Worth in reasonable detail, including, but not limited
to, a balance sheet, income statement, statement of cash flow and other financial information as reasonably requested by Franchisor,
which documentation demonstrates that the Net Worth of the REIT is equal to or greater than two (2) times the amount of the Minimum
Net Worth; (ii) Franchisee must not be in breach of any provision of the Agreement at the time such release is requested or at
the time such release is executed; (iv) AR Capital, LLC, must execute a general release of any and all claims against Franchisor
and its Affiliates, and their respective officers, directors, agents and employees; and (v) Franchisee will be responsible for
payment of Franchisor’s attorneys’ fees and expenses relating to the drafting and execution of the release of AR Capital,
LLC, by Franchisor and the release of Franchisor by Franchisee.


 


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


 


{Signatures appear
on following page}


 




    	4



    	 



    

 


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


 


	 	 	GUARANTOR:
	 	 	 
	WITNESS:	 	AR CAPITAL, LLC
	 	 	 
	 	 	By:  	 	(SEAL)
	Witness	 	Name:
	 	 	Title:
	 	 	 
	WITNESS:	 	AMERICAN REALTY CAPITAL HOSPITALITY
	 	 	 TRUST, INC.
	 	 	 
	 	 	By:	 	(SEAL)
	Witness	 	Name:
	 	 	Title:


 


ADDRESS FOR NOTICES TO GUARANTOR:


 


AR Capital, LLC


405 Park Avenue


New York, NY 10022


 


American Realty Capital Hospitality Trust, Inc.


405 Park Avenue


New York, NY 10022


 




    	5



    	 



    

 


MANAGEMENT COMPANY ACKNOWLEDGMENT


 


This Management Company
Acknowledgment (“Management Company Acknowledgment”) is executed as of March 21, 2014, by and among Crestline Hotels
& Resorts, LLC, a Delaware corporation (“Management Company”), ARC Hospitality TRS Baltimore, LLC, a Delaware limited
liability company (“Franchisee”), and Marriott International, Inc., a Delaware corporation (“Franchisor”).


 


WHEREAS, (i) American
Realty Capital Hospitality Properties, LLC (“ARCHP”), an Affiliate of Management Company, has entered into a Management
Agreement with Franchisee dated January 27, 2014 (the “Prime Management Agreement”); (ii) ARCHP has entered into a
Sub-Management Agreement with Management Company dated January 27, 2014 (the “Sub-Management Agreement”) pursuant to
which ARCHP has delegated to Management Company, and Management Company has assumed, all of the obligations of ARCHP under the
Prime Management Agreement; (iii) pursuant to such delegation and assumption, Management Company will operate that certain Courtyard
by Marriott hotel located at 1000 Aliceanna Street, Baltimore, MD 21202 (the “Hotel”), in accordance with the terms
of that certain Courtyard by Marriott Hotel Relicensing Franchise Agreement dated March 21, 2014 (as such agreement may be amended,
supplemented, restated or otherwise modified, the “Franchise Agreement”) between Franchisor and Franchisee. Unless
otherwise specified, the term “Management Agreement” as used in this Management Company Acknowledgment means the Prime
Management Agreement as modified by the Sub-Management Agreement; and


 


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


 


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


 


1.          Franchisor’s
Consent. Subject to and in accordance with the terms and conditions of this Management Company Acknowledgment and the Franchise
Agreement, Franchisor hereby consents to the operation of the Hotel by Management Company and grants to Management Company the
right to operate the Hotel in accordance with the Standards and to use the System, at, and only at, the Approved Location during
the term of the Franchise Agreement on behalf of Franchisee. Franchisor’s grant in the immediately preceding sentence will
terminate without notice to Management Company contemporaneously with the occurrence of any of the following events: (a) any
termination of the Franchise Agreement, (b) the execution of another management company acknowledgment among Franchisor, Franchisee
and another management company or (c) the execution of an amendment to the Franchise Agreement consenting to the operation of the
Hotel by Franchisee; provided that the duties and obligations of Management Company that by their nature or express language survive
such termination, including Sections 3.b. and c. below, will continue in full force and effect notwithstanding the termination
of Franchisor’s grant in the immediately preceding sentence. For clarity, Franchisor does not consent to the operation of
the Hotel by ARCHP. Franchisee and Management Company acknowledge and agree that any termination of the Sub-Management Agreement,
any modification to the terms thereof that adversely affects Management Company’s right to operate the Hotel, or the operation
of the Hotel by any Person other than Management Company will be a breach of the Franchise Agreement for which Franchisor may terminate
the Franchise Agreement pursuant to Section 19.2.D thereof. Franchisee and Management Company further acknowledge and agree that
if ARCHP becomes a Competitor or an Affiliate of a Competitor, Franchisor will have the right to require Franchisee to terminate
the Prime Management Agreement and either enter into a management agreement directly with Management Company or engage a replacement
management company that will be subject to Franchisor’s consent process under Section 9.4.B of the Franchise Agreement.


 




    	 



    	 



    

 


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


 


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


 


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


 


c.           the
Management Agreement is valid, binding and enforceable; contains no terms, conditions, or provisions that are, or through any act
or omission of Franchisee, ARCHP or Management Company, may be or may cause a breach of or default under the Franchise Agreement;
and is for a term of not less than five (5) years; and


 


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


 


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


 


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


 


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


 


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


 




    	2



    	 



    

 


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


 


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


 


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


 


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


 


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


 


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


 


5.          Authorization;
Contravention.


 


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


 




    	3



    	 



    

 


b.           Management
Company represents and warrants to Franchisor that: (i) neither Management Company (including any and all of its directors and
officers), nor any of its Affiliates or the funding sources for any of the foregoing is a Specially Designated National or Blocked
Person (as defined in the Franchise Agreement); (ii) neither Management Company nor any of its Affiliates is directly or indirectly
owned or controlled by the government of any country that is subject to an embargo by the United States government; and (iii) neither
Management Company nor any of its Affiliates is acting on behalf of a government of any country that is subject to such an embargo.
Management Company further represents and warrants that it is in compliance with any applicable anti-money laundering law, including
the USA Patriot Act. Management Company agrees that it will notify Franchisor in writing immediately upon the occurrence of any
event which would render the foregoing representations and warranties of this Section 5.b. incorrect.


 


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


 


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


 


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


 


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


 


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


 




    	4



    	 



    

 


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


 


12.         Management
Company’s Address. Management Company’s mailing address is 3950 University Drive, Suite 301, Fairfax, VA 22030.
Management Company agrees to provide notice to both Franchisee and Franchisor if there is any change in Management Company’s
mailing address.


 


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


 


{Signatures appear
on following page}


 




    	5



    	 



    

 


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


 


	 	 	FRANCHISOR:
	 	 	 	 
	ATTEST:	 	MARRIOTT INTERNATIONAL, INC.
	 	 	 	 
	 	 	By:	 	(SEAL)
	Assistant Secretary	 	Name:
	 	 	Title:
	 	 	 	 
	 	 	FRANCHISEE:
	 	 	 	 
	WITNESS:	 	ARC HOSPITALITY TRS BALTIMORE, LLC
	 	 	a Delaware limited liability company
	 	 	 	 
	 	 	By: 	ARC Hospitality TRS Holding, LLC, its sole
	 	 	 	member


 


	 	 	By:	American Realty Capital Hospitality
	 	 	 	Operating Partnership, L.P.,
	 	 	 	its sole member
	 	 	 	 
	 	 	 	By:	American Realty Capital Hospitality
	 	 	 	 	Trust, Inc.,
	 	 	 	 	its general partner
	 	 	 	 	 
	 	 	 	 	By:	 	(SEAL)
	Witness	 	 	 	Name:
	 	 	 	 	Title:


 


	 	 	MANAGEMENT COMPANY:
	 	 	 	 
	WITNESS:	 	Crestline Hotels & Resorts, LLC
		 	a Delaware corporation
	 	 	 	 
	 	 	By:	 	(SEAL)
	Witness	 	Name:	 
	 	 	Title:	 


 




    	6



    	 



    

 


ELECTRONIC SYSTEMS LICENSE AGREEMENT


 


This Electronic Systems
License Agreement (“License Agreement”) is made and entered into effective as of the 21st day of March, 2014 (“Effective
Date”), between Marriott International, Inc., a Delaware corporation (“Franchisor”), and ARC Hospitality TRS
Baltimore, LLC, a Delaware limited liability company (“Franchisee”).


 


WITNESSETH:


 


WHEREAS, Franchisor
and Franchisee have entered into a Courtyard by Marriott Hotel Relicensing Franchise Agreement dated as of the date hereof (the
“Franchise Agreement”) under which Franchisee will establish and operate the Hotel under Franchisor’s System
at the location specified in the Franchise Agreement; and


 


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


 


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


 


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


 


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


 


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


 


4.          Third
Party Vendors; Preferred Vendors. If any Electronic System is provided by a third party vendor, Franchisee will comply with
the terms provided by such vendors in connection therewith. Franchisee acknowledges and agrees that such third party vendors will
have the right to enforce such terms directly against Franchisee, and Franchisor will have no liability in connection with Franchisee’s
use of any third party Electronic System. Franchisor may also require Franchisee to execute license or similar agreements directly
with such third party vendors in order to obtain access to Electronic Systems that are required under Franchisor’s System.
Franchisee will be deemed to be in direct privity of contract with any third party provider of Electronic Systems. From time to
time Franchisor may designate a third party vendor of Electronic Systems as a “preferred vendor” based on Franchisor’s
reasonable judgment that such third party Electronic System is suitable or desirable for Franchisor’s System. Franchisee
acknowledges and agrees that Franchisor neither endorses nor makes any representations or warranties in connection with any third
party’s Electronic Systems, including any Electronic System provided by a preferred vendor.


 




    	 



    	 



    

 


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


 


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


 


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


 


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


 


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


 


10.         Software
License Rights Upon Termination. Franchisee acknowledges and agrees that most Software purchased by Franchisees through Franchisor’s
procurement process is purchased in Franchisor’s name, and is not assignable to Franchisee upon termination of this License
Agreement (“Non-Assignable Software”). As such, upon termination of this License Agreement, Franchisee’s right
to use such Non-Assignable Software will automatically cease. With respect to software purchased through Franchisor’s procurement
process that is assignable to Franchisee upon termination of this License Agreement (“Assignable Software”), upon the
request of Franchisee, Franchisor will provide reasonable assistance in helping to facilitate assignment of such software, including
obtaining consent of the vendor where necessary. Upon termination of this License Agreement, Franchisee will delete both Assignable
Software and Non-Assignable Software obtained through Franchisor’s procurement process and, with respect to Assignable Software,
Franchisee may reinstall such software on the applicable computing equipment using software copies obtained by Franchisee directly
from the applicable vendor.


 




    	2



    	 



    

 


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


 


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


 


{Signatures appear
on following page}


 




    	3



    	 



    

 


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


 


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


 





	 	FRANCHISEE:
	 	 	 
	WITNESS:	ARC HOSPITALITY TRS BALTIMORE, LLC
	 	a Delaware limited liability company
	 	 	 
	 	By:	ARC Hospitality TRS Holding, LLC, its sole
	 	 	member
	 	 	 
	 	 	By:	American Realty Capital Hospitality
	 	 	 	Operating Partnership, L.P.,
	 	 	 	its sole member
	 	 	 
	 	 	 	By:	American Realty Capital Hospitality
	 	 	 	 	Trust, Inc.,
	 	 	 	 	its general partner




 





	 	 	 	By:	 	(SEAL)
	Witness	 	 	Name:
	 	 	 	Title:


 




    	4



    	 



    

 


OWNER AGREEMENT


 


This Owner Agreement
(“Agreement”) is entered into as of the 21st day of March, 2014, by and among Marriott International, Inc., a Delaware
corporation (“Franchisor”), ARC Hospitality TRS Baltimore, LLC, a Delaware limited liability company (“Franchisee”),
and ARC Hospitality Baltimore, LLC, a Delaware limited liability company (“Owner”).


 


WITNESSETH:


 


WHEREAS, Franchisor
and Franchisee are parties to that certain Courtyard by Marriott Hotel Relicensing Franchise Agreement dated as of March 21, 2014
(as may be amended from time to time, the “Franchise Agreement”) relating to the Hotel (as defined in the Franchise
Agreement); and


 


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


 


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


 


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


 


1.          Intentionally
Omitted.


 


2.          Termination
of the Franchise Agreement.


 


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


 


3.          Termination
of the Lease.


 


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


 


4.          Transfers
Not Involving Competitors. Section 17 of the Franchise Agreement will apply hereunder to any Transfer of the Hotel, any Ownership
Interest in the Hotel, Owner, this Agreement or the Lease, or a change of Control in Owner or an Affiliate that directly or indirectly
Controls Owner, as if Owner were a party thereto; any such Transfer(s) by Owner as described above will be made only in strict
compliance with Section 17 as the context requires.


 




    	 



    	 



    

 


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


 


A.           No
Transfers to a Competitor. If there is a proposed Transfer to a Competitor of (i) the Hotel (or any interest therein), (ii)
Owner’s Ownership Interest in this Agreement or in the Lease, or (iii) an Ownership Interest or other interest in either
Owner or an Affiliate that directly or indirectly Controls Owner (but excluding any Transfer of Registered Shares so long as such
Transfer(s), individually and in the aggregate, will not effect a Transfer of or change in direct or indirect Control of Franchisee
or the Hotel), Owner will give notice thereof to Franchisor, stating the full name and identity of the prospective purchaser or
tenant, as the case may be, including the names and addresses of the Interestholders of such prospective purchaser or tenant, the
price or rental and all other terms of such proposed transaction, together with all other related information that is reasonably
requested by Franchisor and reasonably available to Owner. Within thirty (30) days after receipt by Franchisor of such notice and
information from Owner, Franchisor will notify Owner of Franchisor’s election, made in its sole discretion, of one (1) of
the immediately following four (4) alternatives:


 


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


 


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


 


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


 


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


 




    	2



    	 



    

 


(c)          The
Arbitrator will be instructed and obligated to decide, within thirty (30) days after appointment, whether the appraisal submitted
by Franchisor or the appraisal submitted by Owner more accurately reflects the fair market value of the Hotel based upon the appraisals
submitted and such information as is normally relied upon by an appraiser of hotels and real estate. Each party agrees to fully
cooperate and provide all information requested by the Arbitrator related to the Arbitrator’s determination of fair market
value of the Hotel. The Arbitrator’s choice of appraisal will be in writing, will constitute the purchase price hereunder,
and will be final, conclusive and binding on the parties as an “award” under the AAA Rules, and may be enforced by
a court of competent jurisdiction. The expenses of the arbitration will be borne equally by the parties to the arbitration. Franchisor
(or its designee) will have the right, at any time within thirty (30) days of being notified in writing of the decision of the
Arbitrator, to either (a) enter into an agreement to purchase the Hotel premises and related property at the valuation determined
by the Arbitrator, or (b) give notice of its intent to terminate this Agreement pursuant to Section 5.A(3) of this Agreement within
fourteen (14) days of such notice. If Franchisor elects to give notice of its intent to terminate this Agreement within fourteen
(14) days of such notice, upon receipt of Franchisor’s election to terminate, Owner and Franchisee will be obligated, jointly
and severally, to either: (i) cancel the Transfer to a Competitor on or before the end of such fourteen (14) days or (ii) remove
the Hotel from the System, pay liquidated damages, and otherwise comply with the post-termination obligations, in each case, as
set forth in Section 9.B of this Agreement and Sections 19.3 and 20 of the Franchise Agreement or, at Franchisor’s election,
as may be set forth in a termination agreement on terms acceptable to Franchisor.


 


(3)         Termination
of Owner Agreement and Franchise Agreement. Franchisor may place Owner and Franchisee in default and give notice of its intent
to terminate this Agreement and the Franchise Agreement pursuant to Section 19.1.K thereof within fourteen (14) days of such notice.
If Franchisor elects to give notice of its intent to terminate this Agreement and the Franchise Agreement within fourteen (14)
days of such notice, upon receipt of Franchisor’s election to terminate, Owner and Franchisee will be obligated, jointly
and severally, to either: (i) cancel the Transfer to a Competitor on or before the end of such fourteen (14) days or (ii) remove
the Hotel from the System, pay liquidated damages, and otherwise comply with the post-termination obligations, in each case, as
set forth in Section 9.B of this Agreement and Sections 19.3 and 20 of the Franchise Agreement or, at Franchisor’s election,
as may be set forth in a termination agreement on terms acceptable to Franchisor.


 


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


 


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


 


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


 


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


 




    	3



    	 



    

 


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


 


E.           Right
of First Refusal. In addition to the events specified in Section 5.A, Franchisor will have the rights set forth in Section
5.A if any event occurs granting Franchisor a right of first refusal under Section 17 of the Franchise Agreement.


 


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


 


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


 


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


 


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


 


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


 


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


 




    	4



    	 



    

 


6.          Intentionally
Omitted.


 


7.          Financing
of the Hotel.


 


A.           Owner
will not, and will cause each Interestholder in Owner to not, incur or replace any indebtedness that is secured by a lien on or
mortgage of the Hotel or the revenues of the Hotel or pledge of Ownership Interests in Owner (whether such indebtedness is incurred
(i) individually on behalf of the Hotel or (ii) on a pooled basis with other hotels or legal entities (a “Financed Pool”))
unless the following conditions are met at the time the indebtedness is incurred or replaced: (1) the indebtedness is with a Lender;
(2) the terms of such indebtedness are consistent with prevailing commercial practices of Lenders at that time in the country in
which the Hotel is located; and (3) there is no violation of Section 7.B below. Owner will give notice to Franchisor of the component
hotels and legal entities in a Financed Pool before incurring such indebtedness.


 


B.           In
connection with any financing benefiting the Hotel or otherwise with respect to the Hotel, Owner will not, and will not allow any
Person to, mortgage, grant a security interest in, or otherwise pledge as collateral the Hotel, the revenues of the Hotel, or an
Ownership Interest in Owner or in a Person Controlling Owner unless such financing meets the requirements of Section 7.A above
or Franchisor otherwise consents to such financing in writing. Owner may not assign, mortgage, or grant a security interest in,
or pledge as collateral, this Agreement. Franchisor has no obligation to provide a “comfort letter” in connection with,
or consent to, a transaction that would be prohibited by this Section 7.B. If a lender forecloses on, or otherwise exercises its
rights against, the Hotel, the revenues of the Hotel, or such Ownership Interests, or Owner violates this Section 7.B, Franchisor
will have the rights under Section 19.1 of the Franchise Agreement and Section 2 hereof. Franchisor has no obligation to license
a lender or any Person acting on behalf of a lender, including a receiver or servicer of a loan, unless that obligation arises
from a valid and binding written agreement between Franchisor and a lender.


 


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


 


9.          Owner’s
Obligations under the Franchise Agreement.


 


A.           Franchisee
Default. If Franchisor declares Franchisee to be in default beyond all applicable notice and cure periods under the Franchise
Agreement, Franchisor may enforce the Franchise Agreement directly against Owner as if Owner were the Franchisee under the Franchise
Agreement, and Owner will perform, or cause to be performed, the provisions of the Franchise Agreement including, without limitation,
Section 3 on fees, Section 9 on operations of the Hotel, and Section 16 on indemnification and insurance.


 


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


 




    	5



    	 



    

 


10.         Provisions
of the Lease. Any lease governing the lease and operation of the Hotel (including the Lease) will include the substance of
the immediately following provisions or such other provisions and requirements as set forth in the Franchise Agreement or in the
Franchise Disclosure Document.


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


14.         Casualty.
If the Hotel is damaged or destroyed by fire or other cause and such damage or destruction is substantial and material, affecting
over forty percent (40%) of the Hotel, and necessitates the closing of the Hotel for a period in excess of one hundred and fifty
(150) days, Owner will have the right to terminate this Agreement upon notice to Franchisor given within one hundred and fifty
(150) days of such closing of the Hotel if it elects not to repair or rebuild the Hotel. Owner and Franchisee will not be required
to pay Franchisor the liquidated damages due under Section 19.3 of the Franchise Agreement in connection with such termination
if such casualty is the sole basis for termination of this Agreement and Owner and Franchisee execute and deliver to Franchisor
a termination agreement and release in form and substance acceptable to Franchisor; provided, however, if subsequent to such notice
and before the date on which the Term of the Franchise Agreement would otherwise have ended under Section 4 of the Franchise Agreement
if such notice of termination had not been given (the “Term Expiration Date”), Owner, or any of its Affiliates or any
Interestholder in Owner with an Ownership Interest of twenty-percent (20%) or greater operates a hotel; vacation, timesharing,
interval or fractional ownership facility; condominium; apartment; or other lodging product at the Approved Location (the “Other
Lodging Product”), which Other Lodging Product is not operated under a license or franchise from Franchisor or one of its
Affiliates (a “Brand Change”), then in such event, Owner will be obligated to promptly pay to Franchisor an amount
equal to the applicable liquidated damages set forth in Section 19.3 of the Franchise Agreement, but clause (ii) in the calculation
of liquidated damages will be the lesser of (a) thirty-six (36) or (b) one-half
(1⁄2) the number of months then remaining between (x) the date upon which the Other Lodging Product is first operated,
and (y) the Term Expiration Date. Owner’s obligations set forth in this Section 14 will survive termination of this Agreement.
If, after Franchisee or Owner has requested consent from Franchisor to re-open the Hotel as a System Hotel and Franchisor does
not consent to such re-opening of the Hotel as a System Hotel, a Brand Change occurs, then Owner will not be obligated to pay liquidated
damages pursuant to this Section 14.


 




    	6



    	 



    

 


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


 


16.         Notices.


 


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


 


	 	To Franchisor:	Marriott International, Inc.
	 	 	10400 Fernwood Road
	 	 	Bethesda, MD  20817
	 	 	Attn: Law Department 52/923.27
	 	 	 
	 	With a copy to:	Marriott International, Inc.
	 	 	10400 Fernwood Road
	 	 	Bethesda, MD  20817
	 	 	Attn:  Vice President, Owner and Franchise Services


 




    	7



    	 



    

 


	 	To Franchisee:	ARC Hospitality TRS Baltimore, LLC
	 	 	405 Park Avenue
	 	 	New York, NY  10022
	 	 	Attn:  Jesse C. Galloway
	 	 	Email: jgalloway@arlcap.com
	 	 	 
	 	To Owner:	ARC Hospitality Baltimore, LLC
	 	 	405 Park Avenue
	 	 	New York, NY  10022
	 	 	Attn:  Jesse C. Galloway
	 	 	Email: jgalloway@arlcap.com


 


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


 


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


 


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


 


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


 


19.         Hotel
Ownership and Ownership Structure.


 


A.           Owner
represents, warrants, and covenants to Franchisor that: (i) Owner is the sole owner of the Hotel and holds good and marketable
fee title to the Approved Location of the Hotel; and (ii) Owner is owned directly and indirectly as set forth on Attachment A.
Upon the request of Franchisor, Owner will submit to Franchisor evidence, in form and substance satisfactory to Franchisor, confirming
that Owner is owned directly and indirectly as set forth on Attachment A (but without the obligation to disclose information about
the owners of Registered Shares except as required by Section 17 of the Franchise Agreement).


 




    	8



    	 



    

 


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


 


20.         Entire
Agreement; Counterparts.


 


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


 


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


 


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


 


22.         Construction
and Severability.


 


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


 


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


 




    	9



    	 



    

 


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


 


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


 


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


 


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


 


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



 


{Signatures appear
on following page}


 




    	10



    	 



    

 


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


 


 


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


 





	 	FRANCHISEE:
	 	 	 
	WITNESS:	ARC HOSPITALITY TRS BALTIMORE, LLC
	 	a Delaware limited liability company
	 	 	 
	 	By:	ARC Hospitality TRS Holding, LLC, its sole
	 	 	member
	 	 	 
	 	 	By:	American Realty Capital Hospitality
	 	 	 	Operating Partnership, L.P.,
	 	 	 	its sole member
	 	 	 
	 	 	 	By:	American Realty Capital Hospitality
	 	 	 	 	Trust, Inc.,
	 	 	 	 	its general partner




 





	 	 	 	By:	 	(SEAL)
	Witness	 	 	Name:
	 	 	 	Title:


 


	 	 	OWNER:
	 	 	 
	WITNESS:	 	ARC Hospitality Baltimore, LLC
	 	 	a Delaware limited liability company
	 	 	 
	 	 	By:  	American Realty Capital Hospitality Operating
	 	 	 	Partnership, L.P.,
	 	 	 	its sole member
	 	 	 
	 	 	 	By:	American Realty Capital Hospitality Trust,
	 	 	 	 	Inc.,
	 	 	 	 	its general partner


 


	 	 	By:	 	(SEAL)
	Witness	 	Name:
	 	 	Title:


 




    	11



    	 



    

 


ATTACHMENT B


 


FRANCHISE AGREEMENT


 




    	12