Exhibit 99.1

LOGO

FOR IMMEDIATE RELEASE



|                                                                          |  |                                                      
|------------------------------------------------------------------------- |  | -----------------------------------------------------
|Jameson Inns, Inc.                                                        |  | Contact: (866) 277-3965                              
|41 Perimeter Center East, Suite 400 Atlanta, Georgia
30346 (770) 481-0305 |  | Investor Relations: investorrelations@jamesoninns.com

Jameson Inns, Inc. Reports Fourth Quarter and FY 2005 Financial Results

March 6, 2006

ATLANTA, GAJameson Inns, Inc. (NASDAQ: JAMS),
owner and operator of Jameson Inn and Signature Inn hotels, today announced financial results for the fourth quarter and fiscal year ended December 31, 2005.

Fourth Quarter Highlights



| |  |  | Jameson Inn Brand RevPAR Up 19% Due to Record Gains in Occupancy
| | - |  | ----------------------------------------------------------------



| |  |  | RevPAR for All Hotels in Continuing Operations Increased 18%
| | - |  | ------------------------------------------------------------



| |  |  | RevPAR for 5 Newly Converted Jameson Inns Grew 21%
| | - |  | --------------------------------------------------



| |  |  | Net Loss Per Common Share Improves to ($0.03) from ($0.14)
| | - |  | ----------------------------------------------------------



| |  |  | Adjusted EBITDA for Continuing Operations Rises 51% to $6.3 million
| | - |  | -------------------------------------------------------------------



| |  |  | Fiscal Year Net Income Per Common Share Improves to $0.01 from a Loss of ($1.06)
| | - |  | --------------------------------------------------------------------------------

Fourth Quarter Results



|                                          |  |      |             |   |      |   |             |            |  |                 
|----------------------------------------- |  | ---- | ----------- | - | ---- | - | ----------- | ---------- |  | ----------------
|Three Months Ended December 31,           |  | 2005 |             |   | 2004 |   |             | Net Change
|Jameson Inn Brand RevPAR                  |  | $    | 37.55       |   |      | $ | 31.66       |            |  | +19%            
|Combined Brands RevPAR                    |  | $    | 34.16       |   |      | $ | 29.02       |            |  | +18%            
|Newly Converted Inns RevPAR               |  | $    | 33.12       |   |      | $ | 27.45       |            |  | +21%            
|Jameson Inn Brand Occupancy               |  |      | 57.3        | % |      |   | 50.7        | %          |  | 660 basis points
|Net Loss per Common Share                 |  |      | ($0.03      | ) |      |   | ($0.14      | )          |  | +79%            
|Adjusted EBITDA for Continuing Operations |  | $    | 6.3 million |   |      | $ | 4.2 million |            |  | +51%            



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For the quarter ended December 31, 2005, total revenue was $22.6 million, net loss totaled $1.7 million or
($0.03) per common share, and adjusted EBITDA was $6.3 million.

Lodging revenues grew by approximately $3.2 million or 16.8% to $22.3 million in the
fourth quarter 2005 from $19.1 million in the same period in 2004. The improvement resulted from an increase in average daily rate (ADR) of $1.89, or 3.0%, and an increase in occupancy of 6.6 percentage points, to 52.3%. This combination drove a
17.7% increase in revenue per available room (RevPAR) for combined brands.

Occupancy for the Companys core brand, Jameson Inn, increased 6.6
percentage points to 57.3% in fourth quarter 2005 from 50.7% in the same period in 2004 while ADR increased 4.9% to $65.50 in the fourth quarter 2005 as compared to $62.43 in the same period in 2004. This combination drove RevPAR 18.6% higher to
$37.55, or $5.89 better than the same period in 2004.

Gross operating profit, defined as total revenues less direct lodging expenses, improved to $10.3
million in fourth quarter 2005 from $8.2 million in the same period of 2004. As a percentage of revenues, gross operating profit improved to 45.5% in fourth quarter 2005 from 42.7% in the same period of 2004.

ADR for the Signature Inn brand was $64.40 in fourth quarter 2005 compared to $67.91 in the same period in 2004, while occupancy was 30.3% compared to 32.5%, in the same
period last year. This resulted in a RevPAR decline of 11.5%. Four Signature Inns were under renovation and conversion during the fourth quarter 2005, causing an overall decrease in performance of these Inns during the period. Through a combination
of asset sales and conversions, we have reduced the number of Signature Inns from 26 to 12 (excluding two classified as held-for-sale) at December 31, 2005. Our plan remains to convert the remaining 12 Signature Inns to Jameson Inns, completing
six by the end of 2006 and the last six in 2007.

Thomas W. Kitchin, Chairman and Chief Executive Officer of Jameson Inns, Inc., stated This was one
of the best years in the Companys recent history. We believe that we are building momentum and producing very positive results driven by our capital investment programs, including the on-going conversion of our Signature Inns to the Jameson
Inn brand.

Fiscal Year Results



|                                          |  |      |              |   |      |   |              |            |  |                 
|----------------------------------------- |  | ---- | ------------ | - | ---- | - | ------------ | ---------- |  | ----------------
|Twelve Months Ended December 31,          |  | 2005 |              |   | 2004 |   |              | Net Change
|Jameson Inn Brand RevPAR                  |  | $    | 37.82        |   |      | $ | 33.50        |            |  | +13%            
|Combined Brands RevPAR                    |  | $    | 34.72        |   |      | $ | 31.38        |            |  | +11%            
|Jameson Inn Brand Occupancy               |  |      | 59.3         | % |      |   | 55.6         | %          |  | 370 basis points
|Net Income (Loss) per Common Share        |  | $    | 0.01         |   |      |   | ($1.06       | )          |  | +101%           
|Adjusted EBITDA for Continuing Operations |  | $    | 28.6 million |   |      | $ | 26.5 million |            |  | +8%             

Net income attributable to common stockholders was approximately $0.6 million, or $0.01 per share for fiscal year
2005, compared to a net loss of approximately $34.1 million, or ($1.06) per share in 2004. The net change was primarily due to a one time lease termination expense in 2004 of approximately $9.0 million resulting from the acquisition of Kitchin
Hospitality, LLC and a loss on redemption of the preferred stock of approximately $16.0 million, which were partially offset by an income tax benefit of approximately $1.4 million to establish an initial deferred tax asset due to the change in
taxable status in 2004 and the elimination of preferred dividends of approximately $4.4 million.



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Lodging revenues rose 7.2% to $90.6 million for fiscal year 2005, compared to $84.5 million in 2004 driven by an
occupancy rate increase of 3.7 percentage points for Jameson Inns to 59.3% from 55.6%. ADR for the Jameson Inn brand increased 5.8% to $63.83 for the year ended December 31, 2005. This combination resulted in a RevPAR increase of 12.9% for the
Jameson Inn brand.

Mr. Kitchin continued, The Company is also benefiting from industry-wide improvement. The double digit RevPAR gain of 13%
for our Jameson Inn brand in 2005 far exceeds the 8% gain for the lodging industry. Our 3.7 percentage point improvement in occupancy for the year is more than double the industry-wide results. As we have previously noted, achieving higher occupancy
levels is a critical part of our long-term growth strategy as it allows the Company to focus on improving our ADR, which is key to increasing our profitability.

Gross operating profit improved to $43.6 million in 2005 from $39.7 million in 2004. As a percentage of revenue, gross operating profit improved to 47.7 % in 2005 from 46.7% in 2004. Our margins have
historically been strong since we do not pay franchise fees, said Kitchin. We are pleased to see growth in gross operating profit for both the quarter and year.

During 2005, ADR for the Signature Inn brand increased less than 1%, while occupancy decreased to 36.7% from 39.1%. This combination resulted in a RevPAR decrease of 6.0% for the Signature Inn brand.

Mr. Kitchin concluded, The migration of the Company to our core brand, Jameson Inn, continues to minimize the impact of the Signature Inn brand. By the end of
2006, our conversion and renovation program should be 65% complete. We are convinced that our transition from the two brands to our strong Jameson Inn brand alone will enhance our opportunity to increase market share and improve performance in the
coming years.

Balance Sheet

At
December 31, 2005 variable rate debt as a percentage of total outstanding debt was reduced to approximately 50% from 94% at December 31, 2004. Also, at December 31, 2005, the Company had $6.1 million debt outstanding classified as
current maturities compared to $50.0 million at December 31, 2004. The weighted average interest rate of the Companys debt was 6.3% in 2005 as compared to 5.2% in 2004.

Mr. Craig Kitchin, President and Chief Financial Officer of Jameson Inns, Inc. commented, During 2005, we made significant strides in improving our balance sheet by fixing the interest rates on a large
portion of our debt and reducing current maturities of our mortgage debt to $6.1 million from $50.0 million at December 31, 2004. We were also able to unencumber 31 of our hotels which further strengthens our balance sheet and financial
flexibility. In 2006, we will continue to focus on fixing interest rates and extending maturities.

First Quarter 2006 Update

For the first two months of 2006, occupancy for all continuing operations hotels was 47.6% versus 43.2% in the same period in 2005. The ADR for these hotels was $63.77
compared to $62.85 in the same period in 2005. Consequently, RevPAR was $30.33, up 11.8% over RevPAR of $27.12 in the same period in 2005.

For the five
Inns converted to Jameson Inns in 2005, RevPAR was up 39.8% for the first two months of 2006. Three of those Inns were in the construction stage during all or a substantial part of the first two months of 2005.



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In February 2006, as part of the Companys ongoing divestiture strategy, the Company closed the sale of the two
remaining Signature Inns that were classified as held-for-sale.

Inns Undergoing Renovation and Conversion

The Company continues to increase its focus on the stronger performing proprietary Jameson Inn brand through the conversion of Signature Inns. The conversions include a
significant renovation and upgrade to the physical property. The Company completed the conversion of five Inns in 2005 and expects to complete four additional Inns by the start of the third quarter 2006 and two more by the end of 2006. The Company
expects to complete the remaining six hotel conversions by the end of 2007.

During the fourth quarter, based on the perceived success of the
Companys conversion strategy in 2005, the Company removed the Signature Inns in Evansville, Indiana and Springfield, Illinois from the held-for-sale category, and will now convert them to the Jameson Inn brand.

The Company invested approximately $7.5 million in the fourth quarter of 2005 and approximately $18.6 million for the year ended December 31, 2005 for its capital
refurbishment program, renovation and conversion projects. The 2006 budget for capital improvement projects is $19.0 million which includes the renovation and conversion of Signature Inns and refurbishment of existing Jameson Inns.

Total Inns

At December 31, 2005, the Company owned 95 Jameson
Inns (including five which are converted Signature Inns), and franchised an additional 12 Jameson Inns in the southeastern and midwestern United States. At the same date, the Company also owned 14 Signature Inns (including four that were in the
process of being converted to Jameson Inns and two that were held-for-sale) in the midwestern United States.

The Companys 109* owned and 12
franchised Inns are located in the following states:



|            |  |              |  |                |  |        |  |       |  |                          |  |       |  |       |  
|----------- |  | ------------ |  | -------------- |  | ------ |  | ----- |  | ------------------------ |  | ----- |  | ----- | -
|            |  |              |  |                |  |        |  |       |  | Combined Brands          | 
|            |  | Jameson Inns |  | Signature Inns |  | Hotels |  | Rooms |  | Percentageof Total Rooms | 
|State       |  | Hotels       |  | Rooms          |  | Hotels |  | Rooms |  |                          | 
|Georgia     |  | 31           |  | 1,596          |  |       |  |      |  | 31                       |  | 1,596 |  | 20.4  | %
|Indiana     |  | 2            |  | 246            |  | 10     |  | 1,096 |  | 12                       |  | 1,342 |  | 17.2  | %
|Alabama     |  | 18           |  | 960            |  |       |  |      |  | 18                       |  | 960   |  | 12.3  | %
|Tennessee   |  | 12           |  | 780            |  |       |  |      |  | 12                       |  | 780   |  | 10.0  | %
|N. Carolina |  | 14           |  | 677            |  |       |  |      |  | 14                       |  | 677   |  | 8.7   | %
|S. Carolina |  | 10           |  | 577            |  |       |  |      |  | 10                       |  | 577   |  | 7.4   | %
|Florida     |  | 6            |  | 390            |  |       |  |      |  | 6                        |  | 390   |  | 5.0   | %
|Illinois    |  |             |  |               |  | 3      |  | 371   |  | 3                        |  | 371   |  | 4.7   | %
|Mississippi |  | 6            |  | 349            |  |       |  |      |  | 6                        |  | 349   |  | 4.5   | %
|Kentucky    |  | 3            |  | 305            |  |       |  |      |  | 3                        |  | 305   |  | 3.9   | %
|Louisiana   |  | 3            |  | 213            |  |       |  |      |  | 3                        |  | 213   |  | 2.7   | %
|Ohio        |  |             |  |               |  | 1      |  | 125   |  | 1                        |  | 125   |  | 1.6   | %
|Virginia    |  | 2            |  | 122            |  |       |  |      |  | 2                        |  | 122   |  | 1.6   | %
|            |  |              |  |                |  |        |  |       |  |                          |  |       |  |       |  
|Total       |  | 107          |  | 6,215          |  | 14     |  | 1,592 |  | 121                      |  | 7,807 |  | 100.0 | %
|            |  |              |  |                |  |        |  |       |  |                          |  |       |  |       |  



|* | Includes two Signature Inns (totaling 263 rooms) held-for-sale at December 31, 2005.
|- | ------------------------------------------------------------------------------------



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Earnings Conference Call

As previously announced, the Companys fourth quarter and fiscal year ended December 31, 2005, earnings conference call is scheduled for 5:00 pm EST, March 6, 2006.

A live audio of the call will be accessible to the public by calling US/Canada Dial-In #: (800) 811-8824 or International/Local Dial-In #: (913) 981-4903. Callers should
dial in approximately 5 minutes before the call begins. The call is also available via the internet at www.jamesoninns.com.

A conference call replay will
be available one hour following the call for seven days and can be accessed by calling: (888) 203-1112 (U.S. Callers) or (719) 457-0820 (International Callers) Conference ID 5048272. A replay of the conference call will also be available
for thirty days following the call at www.jamesoninns.com.

For more information about Jameson Inns, Inc., visit the Companys website at
www.jamesoninns.com.



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Operating Statistics



|                                        |  |                                 |  |                |  |      |     |  |        |   |        |      |       |      |   |       |  |      |       |        |   |       |  |       |  
|--------------------------------------- |  | ------------------------------- |  | -------------- |  | ---- | --- |  | ------ | - | ------ | ---- | ----- | ---- | - | ----- |  | ---- | ----- | ------ | - | ----- |  | ----- | -
|                                        |  | Three Months Ended December 31, | 
|                                        |  | Room Nights Available           |  | Occupancy Rate |  |      | ADR |  | RevPAR |   | RevPAR |     
|                                        |  | 2005                            |  | 2004           |  | 2005 |     |  | 2004   |   |        | 2005 |       | 2004 |   | 2005  |  | 2004 |       | Change |  
|Jameson Inns(1)                         |  | 527,774                         |  | 471,500        |  | 57.3 | %   |  | 50.7   | % |        | $    | 65.50 |      | $ | 62.43 |  | $    | 37.55 |        | $ | 31.66 |  | 18.6  | %
|Signature Inns(1)                       |  | 122,268                         |  | 178,296        |  | 30.3 | %   |  | 32.5   | % |        | $    | 64.40 |      | $ | 67.91 |  | $    | 19.50 |        | $ | 22.03 |  | -11.5 | %
|Combined Brands(1)                      |  | 650,042                         |  | 649,796        |  | 52.3 | %   |  | 45.7   | % |        | $    | 65.38 |      | $ | 63.49 |  | $    | 34.16 |        | $ | 29.02 |  | 17.7  | %
|Discontinued Operations                 |  | 24,196                          |  | 62,744         |  | 38.5 | %   |  | 29.34  | % |        | $    | 44.57 |      | $ | 55.97 |  | $    | 17.16 |        | $ | 16.42 |  | 4.5   | %
|                                        | 
|                                        |  | Year Ended December 31,         | 
|                                        |  | Room Nights Available           |  | Occupancy Rate |  |      | ADR |  | RevPAR |   | RevPAR |     
|                                        |  | 2005                            |  | 2004           |  | 2005 |     |  | 2004   |   |        | 2005 |       | 2004 |   | 2005  |  | 2004 |       | Change |  
|Jameson Inns(1)                         |  | 1,994,663                       |  | 1,900,085      |  | 59.3 | %   |  | 55.6   | % |        | $    | 63.83 |      | $ | 60.31 |  | $    | 37.82 |        | $ | 33.50 |  | 12.9  | %
|Signature Inns(1)                       |  | 585,247                         |  | 709,308        |  | 36.7 | %   |  | 39.1   | % |        | $    | 65.94 |      | $ | 65.70 |  | $    | 24.17 |        | $ | 25.70 |  | -6.0  | %
|Combined Brands(1)                      |  | 2,579,910                       |  | 2,609,393      |  | 54.1 | %   |  | 51.1   | % |        | $    | 64.15 |      | $ | 61.43 |  | $    | 34.72 |        | $ | 31.38 |  | 10.6  | %
|Discontinued Operations                 |  | 168,263                         |  | 265,872        |  | 40.5 | %   |  | 36.6   | % |        | $    | 53.07 |      | $ | 55.97 |  | $    | 21.51 |        | $ | 20.51 |  | 4.9   | %
|                                        | 
|                                        |  | Three Months Ended December 31, | 
|                                        |  | Room Nights Available           |  | Occupancy Rate |  |      | ADR |  | RevPAR |   | RevPAR |     
|                                        |  | 2005                            |  | 2004           |  | 2005 |     |  | 2004   |   |        | 2005 |       | 2004 |   | 2005  |  | 2004 |       | Change |  
|Converted Inns(2)                       |  | 55,752                          |  | 56,120         |  | 41.7 | %   |  | 36.2   | % |        | $    | 79.53 |      | $ | 75.80 |  | $    | 33.12 |        | $ | 27.45 |  | 20.7  | %
|Inns under renovation and conversion(3) |  | 37,536                          |  | 37,536         |  | 26.6 | %   |  | 29.7   | % |        | $    | 70.03 |      | $ | 70.27 |  | $    | 18.65 |        | $ | 20.87 |  | -10.6 | %



|(1) | Brand statistics reflect only owned hotels included in continuing operations.
|--- | -----------------------------------------------------------------------------



|(2) | The Signature Inn in Knoxville, Tennessee and the two in Louisville, Kentucky were converted
and began operating as Jameson Inns on April 1, 2005. The Signature Inns in South Bend and Elkhart, Indiana were converted and began operating as Jameson Inns on October 1, 2005.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(3) | The operating results of four Signature Inns in Indianapolis, Indiana were negatively
impacted by the on-going renovation activity during the fourth quarter of 2005. These Inns will be converted to Jameson Inns by the beginning of the third quarter 2006.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Consolidated Balance Sheets



|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------- | ----------- | - | ---------------- | - | ----------- | -
|                                                                                                                                                                         |  | December 31,2005 |             |   | December 31,2004 |  
|Assets                                                                                                                                                                   |  |                  |             |   |                  |   |             |  
|Current Assets:                                                                                                                                                          |  |                  |             |   |                  |   |             |  
|Cash and cash equivalents                                                                                                                                                |  | $                | 2,721,239   |   |                  | $ | 1,626,322   |  
|Restricted cash                                                                                                                                                          |  |                  | 675,554     |   |                  |   | 1,745,171   |  
|Trade accounts receivable, net of allowance of $106,240 and $124,504 at December 31, 2005 and 2004, respectively                                                         |  |                  | 1,967,905   |   |                  |   | 1,442,912   |  
|Other receivables                                                                                                                                                        |  |                  | 330,214     |   |                  |   | 206,706     |  
|Prepaid expenses                                                                                                                                                         |  |                  | 658,626     |   |                  |   | 554,105     |  
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|Total current assets                                                                                                                                                     |  |                  | 6,353,538   |   |                  |   | 5,575,216   |  
|Operating property and equipment                                                                                                                                         |  |                  | 367,726,058 |   |                  |   | 352,108,626 |  
|Less accumulated depreciation                                                                                                                                            |  |                  | (98,852,841 | ) |                  |   | (91,160,887 | )
|Property and equipment held for sale, net                                                                                                                                |  |                  | 5,528,024   |   |                  |   | 16,754,836  |  
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|                                                                                                                                                                         |  |                  | 274,401,241 |   |                  |   | 277,702,575 |  
|Deferred finance costs, net                                                                                                                                              |  |                  | 5,043,276   |   |                  |   | 1,881,995   |  
|Other assets                                                                                                                                                             |  |                  | 663,262     |   |                  |   | 976,554     |  
|Investment in trust preferred securities                                                                                                                                 |  |                  | 812,000     |   |                  |   |            |  
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|Total assets                                                                                                                                                             |  | $                | 287,273,317 |   |                  | $ | 286,136,340 |  
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|Liabilities and Stockholders Equity                                                                                                                                     |  |                  |             |   |                  |   |             |  
|Current Liabilities:                                                                                                                                                     |  |                  |             |   |                  |   |             |  
|Current maturities of mortgage notes payable                                                                                                                             |  | $                | 6,094,895   |   |                  | $ | 49,991,739  |  
|Line of credit borrowings                                                                                                                                                |  |                  | 2,502,015   |   |                  |   | 110,216     |  
|Accounts payable and accrued expenses                                                                                                                                    |  |                  | 7,119,046   |   |                  |   | 4,582,803   |  
|Accrued interest payable                                                                                                                                                 |  |                  | 751,009     |   |                  |   | 830,368     |  
|Accrued property and other taxes                                                                                                                                         |  |                  | 1,801,260   |   |                  |   | 2,165,734   |  
|Accrued payroll                                                                                                                                                          |  |                  | 1,850,898   |   |                  |   | 1,150,571   |  
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|Total current liabilities                                                                                                                                                |  |                  | 20,119,123  |   |                  |   | 58,831,431  |  
|Mortgage notes payable, less current portion                                                                                                                             |  |                  | 124,315,246 |   |                  |   | 147,737,940 |  
|Trust preferred notes                                                                                                                                                    |  |                  | 27,062,000  |   |                  |   |            |  
|Convertible notes                                                                                                                                                        |  |                  | 35,000,000  |   |                  |   |            |  
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|Total liabilities                                                                                                                                                        |  |                  | 206,496,369 |   |                  |   | 206,569,371 |  
|Stockholders Equity                                                                                                                                                     |  |                  |             |   |                  |   |             |  
|Common stock, $0.10 par value, 100,000,000 shares authorized, 57,510,490 shares and 57,052,630 shares issued and outstanding at
December 31, 2005 and 2004, respectively |  |                  | 5,751,049   |   |                  |   | 5,705,263   |  
|Contributed capital                                                                                                                                                      |  |                  | 110,705,429 |   |                  |   | 110,375,931 |  
|Unamortized deferred compensation                                                                                                                                        |  |                  | (1,589,541  | ) |                  |   | (1,819,158  | )
|Retained deficit                                                                                                                                                         |  |                  | (34,089,989 | ) |                  |   | (34,695,067 | )
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|Total stockholders equity                                                                                                                                               |  |                  | 80,776,948  |   |                  |   | 79,566,969  |  
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  
|Total liabilities and stockholders equity                                                                                                                               |  | $                | 287,273,317 |   |                  | $ | 286,136,340 |  
|                                                                                                                                                                         |  |                  |             |   |                  |   |             |  



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Consolidated Statements of Operations



|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|---------------------------------------------------------------------------- |  | ------------------------------ | ---------- | - | ----------------------- | - | ---------- | ---- |  | - | ---------- | - |  | - | ----------- | -
|                                                                             |  | Three Months EndedDecember 31, |            |   | Year Ended December 31, |  
|                                                                             |  | 2005                           |            |   | 2004                    |   |            | 2005 |  |   | 2004       |  
|                                                                             |  | (unaudited)                    |            |   | (unaudited)             |   |            |      |  |   |            |  
|Lodging revenues                                                             |  | $                              | 22,339,385 |   |                         | $ | 19,130,793 |      |  | $ | 90,577,289 |   |  | $ | 84,509,633  |  
|Other revenues                                                               |  |                                | 302,593    |   |                         |   | 141,981    |      |  |   | 793,283    |   |  |   | 475,450     |  
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Total revenues                                                               |  |                                | 22,641,978 |   |                         |   | 19,272,774 |      |  |   | 91,370,572 |   |  |   | 84,985,083  |  
|Direct lodging expenses                                                      |  |                                | 12,329,595 |   |                         |   | 11,051,517 |      |  |   | 47,804,628 |   |  |   | 45,325,170  |  
|Property and other taxes and insurance                                       |  |                                | 1,362,051  |   |                         |   | 1,649,626  |      |  |   | 5,484,289  |   |  |   | 5,692,379   |  
|Depreciation                                                                 |  |                                | 4,319,713  |   |                         |   | 3,269,198  |      |  |   | 14,824,191 |   |  |   | 13,874,188  |  
|Corporate general and administrative                                         |  |                                | 2,640,419  |   |                         |   | 2,385,955  |      |  |   | 9,481,671  |   |  |   | 7,507,013   |  
|Interest expense                                                             |  |                                | 3,586,116  |   |                         |   | 2,598,031  |      |  |   | 12,970,200 |   |  |   | 10,586,296  |  
|Early extinguishment of mortgage notes                                       |  |                                | 1,254      |   |                         |   | 34,225     |      |  |   | 384,797    |   |  |   | 66,240      |  
|Lease termination costs                                                      |  |                                |           |   |                         |   |           |      |  |   |           |   |  |   | 8,954,361   |  
|Loss on impairment of real estate                                            |  |                                |           |   |                         |   |           |      |  |   |           |   |  |   | 769,400     |  
|Gain on sale of property and equipment                                       |  |                                | (15,077    | ) |                         |   | (34,817    | )    |  |   | (19,451    | ) |  |   | (767,107    | )
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Total expenses                                                               |  |                                | 24,224,071 |   |                         |   | 20,953,735 |      |  |   | 90,930,325 |   |  |   | 92,007,940  |  
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Income (loss) before income taxes and discontinued operations                |  |                                | (1,582,093 | ) |                         |   | (1,680,961 | )    |  |   | 440,247    |   |  |   | (7,022,857  | )
|Deferred tax benefit due to change in taxable status                         |  |                                |           |   |                         |   |           |      |  |   |           |   |  |   | (1,397,672  | )
|Income tax expense (benefit)                                                 |  |                                |           |   |                         |   | 1,405,603  |      |  |   |           |   |  |   | 1,397,672   |  
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Net income (loss) from continuing operations                                 |  |                                | (1,582,093 | ) |                         |   | (3,086,564 | )    |  |   | 440,247    |   |  |   | (7,022,857  | )
|Income (loss) from discontinued operations                                   |  |                                | (36,833    | ) |                         |   | (498,055   | )    |  |   | (92,336    | ) |  |   | (912,740    | )
|Loss on impairment related to discontinued operations                        |  |                                | (80,000    | ) |                         |   | (2,253,972 | )    |  |   | (80,000    | ) |  |   | (5,878,301  | )
|Gain (loss) on sale of discontinued operations                               |  |                                |           |   |                         |   |           |      |  |   | 337,167    |   |  |   | 34,638      |  
|Income tax (benefit)                                                         |  |                                |           |   |                         |   | 1,914,631  |      |  |   |           |   |  |   |            |  
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Net income (loss) from discontinued operations                               |  |                                | (116,833   | ) |                         |   | (4,666,658 | )    |  |   | 164,831    |   |  |   | (6,756,403  | )
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Net income (loss)                                                            |  |                                | (1,698,926 | ) |                         |   | (7,753,222 | )    |  |   | 605,078    |   |  |   | (13,779,260 | )
|Preferred stock dividends                                                    |  |                                |           |   |                         |   | (10        | )    |  |   |           |   |  |   | 4,371,706   |  
|Loss on redemption of preferred stock                                        |  |                                |           |   |                         |   |           |      |  |   |           |   |  |   | 15,954,925  |  
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Net income (loss) attributable to common stockholders                        |  | $                              | (1,698,926 | ) |                         | $ | (7,753,212 | )    |  | $ | 605,078    |   |  | $ | (34,105,891 | )
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Per common share (basic and diluted):                                        |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Income (loss) from continuing operations attributable to common stockholders |  | $                              | (0.03      | ) |                         | $ | (0.06      | )    |  | $ | 0.01       |   |  | $ | (0.85       | )
|Income (loss) from discontinued operations                                   |  |                                |           |   |                         |   | (0.08      | )    |  |   |           |   |  |   | (0.21       | )
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Net income (loss) attributable to common stockholders                        |  | $                              | (0.03      | ) |                         | $ | (0.14      | )    |  | $ | 0.01       |   |  | $ | (1.06       | )
|                                                                             |  |                                |            |   |                         |   |            |      |  |   |            |   |  |   |             |  
|Weighted average shares - basic and diluted                                  |  |                                | 56,758,561 |   |                         |   | 56,494,747 |      |  |   | 56,760,147 |   |  |   | 32,260,713  |  



- 8 -



---

-CONTINUED-



Consolidated Statements of Cash Flows



|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|------------------------------------------------------------------------------------------------------------------- |  | ---------------------- | ----------- | - | --------------- | - | ----------- | --------------- |  | - | ----------- | -
|                                                                                                                    |  | Year Ended December 31 |            
|                                                                                                                    |  | 2005                   |             |   | 2004 as revised |   |             | 2003 as revised | 
|Operating activities                                                                                                |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Net income (loss)                                                                                                   |  | $                      | 605,078     |   |                 | $ | (13,779,260 | )               |  | $ | (865,274    | )
|Adjustments to reconcile net income (loss) from continuing operations to net cash provided by operating activities: |  |                        |             |   |                 |   |             |                 |  |   |             |  
|(Income) loss from discontinued operations                                                                          |  |                        | (164,831    | ) |                 |   | 6,756,403   |                 |  |   | (832,019    | )
|Depreciation                                                                                                        |  |                        | 14,824,191  |   |                 |   | 13,874,188  |                 |  |   | 16,613,878  |  
|Amortization of deferred finance costs                                                                              |  |                        | 667,698     |   |                 |   | 765,201     |                 |  |   | 945,943     |  
|Stock-based compensation expense                                                                                    |  |                        | 364,204     |   |                 |   | 399,983     |                 |  |   | 409,587     |  
|Loss on impairment of real estate                                                                                   |  |                        |            |   |                 |   | 769,400     |                 |  |   | 710,000     |  
|Early extinguishments of debt                                                                                       |  |                        | 384,797     |   |                 |   | 66,240      |                 |  |   | 211,009     |  
|Lease termination costs- non cash                                                                                   |  |                        |            |   |                 |   | 9,215,220   |                 |  |   |            |  
|Gain on disposal of property and equipment                                                                          |  |                        | (19,451     | ) |                 |   | (767,107    | )               |  |   | (56,086     | )
|Changes in assets and liabilities increasing (decreasing) cash:                                                     |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Trade accounts receivable, net                                                                                      |  |                        | (524,993    | ) |                 |   | 69,591      |                 |  |   |            |  
|Other receivables, net                                                                                              |  |                        | (123,508    | ) |                 |   | (59,791     | )               |  |   |            |  
|Prepaid expenses and other assets                                                                                   |  |                        | 99,338      |   |                 |   | 154,980     |                 |  |   | (49,330     | )
|Receivable from affiliate                                                                                           |  |                        |            |   |                 |   |            |                 |  |   | (1,762,845  | )
|Accounts payable and accrued expenses                                                                               |  |                        | 1,051,619   |   |                 |   | 638,674     |                 |  |   | 820,362     |  
|Accrued interest payable                                                                                            |  |                        | (35,659     | ) |                 |   | (138,259    | )               |  |   | (69,165     | )
|Accrued property and other taxes                                                                                    |  |                        | (364,474    | ) |                 |   | 522,903     |                 |  |   | (188,454    | )
|Accrued payroll                                                                                                     |  |                        | 700,327     |   |                 |   | 319,150     |                 |  |   |            |  
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Net cash provided by operating activities - continuing operations                                                   |  |                        | 17,464,336  |   |                 |   | 18,807,516  |                 |  |   | 15,887,606  |  
|Net cash provide by (used in) operating activities - discontinued operations                                        |  |                        | 304,629     |   |                 |   | (915,247    | )               |  |   | 2,389,673   |  
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Net cash provided by operating activities                                                                           |  |                        | 17,768,965  |   |                 |   | 17,892,269  |                 |  |   | 18,277,279  |  
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Investing activities                                                                                                |  |                        |             |   |                 |   |             |                 |  |   |             |  
|(Additions) reductions to restricted cash for FF&E reserves                                                         |  |                        | 1,069,617   |   |                 |   | (103,133    | )               |  |   | (192,213    | )
|Proceeds from disposition of land, property and equipment                                                           |  |                        | 315,951     |   |                 |   | 5,075,397   |                 |  |   | 1,200,135   |  
|Additions to property and equipment                                                                                 |  |                        | (17,396,891 | ) |                 |   | (7,422,365  | )               |  |   | (4,160,200  | )
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Net cash used in investing activities - continuing operations                                                       |  |                        | (16,011,323 | ) |                 |   | (2,450,101  | )               |  |   | (3,152,278  | )
|Net cash provided by investing activities - discontinued operations                                                 |  |                        | 7,532,124   |   |                 |   | 4,033,407   |                 |  |   | 2,495,389   |  
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Net cash (used in) provided by investing activities                                                                 |  |                        | (8,479,199  | ) |                 |   | 1,583,306   |                 |  |   | (656,889    | )
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Financing activities                                                                                                |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Common stock dividends paid                                                                                         |  |                        |            |   |                 |   |            |                 |  |   | (1,786,984  | )
|Preferred stock dividends paid                                                                                      |  |                        |            |   |                 |   | (6,039,318  | )               |  |   | (6,668,345  | )
|Proceeds from issuance of common stock, net of offering expense                                                     |  |                        | 164         |   |                 |   | 76,948,406  |                 |  |   | 110,647     |  
|Payments on redemption of preferred stock, net                                                                      |  |                        |            |   |                 |   | (75,662,976 | )               |  |   |            |  
|Advances for mortgage note refinancing                                                                              |  |                        | (200,000    | ) |                 |   |            |                 |  |   |            |  
|Proceeds from mortgage notes payable                                                                                |  |                        |            |   |                 |   | 17,050,929  |                 |  |   | 10,470,736  |  
|Proceeds from trust preferred securities offering, net of deferred finance costs of $784,500                        |  |                        | 25,465,500  |   |                 |   |            |                 |  |   |            |  
|Proceeds from convertible notes issuance                                                                            |  |                        | 35,000,000  |   |                 |   |            |                 |  |   |            |  
|Proceeds from line of credit, net                                                                                   |  |                        | 2,391,799   |   |                 |   | 100,541     |                 |  |   |            |  
|Payments of deferred finance costs                                                                                  |  |                        | (3,489,074  | ) |                 |   | (661,225    | )               |  |   | (560,781    | )
|Payoffs of mortgage notes payable                                                                                   |  |                        | (47,247,077 | ) |                 |   | (19,638,233 | )               |  |   | (7,130,040  | )
|Payments on mortgage notes payable                                                                                  |  |                        | (7,971,875  | ) |                 |   | (10,511,850 | )               |  |   | (10,005,195 | )
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Net cash provided by (used in) financing activities - continuing operations                                         |  |                        | 3,949,437   |   |                 |   | (18,413,726 | )               |  |   | (15,569,962 | )
|Net cash used in financing activities - discontinued operations                                                     |  |                        | (12,144,286 | ) |                 |   | (2,984,610  | )               |  |   | (2,333,822  | )
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Net cash used in financing activities                                                                               |  |                        | (8,194,849  | ) |                 |   | (21,398,336 | )               |  |   | (17,903,784 | )
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Net change in cash and cash equivalents                                                                             |  |                        | 1,094,917   |   |                 |   | (1,922,761  | )               |  |   | (283,394    | )
|Cash and cash equivalents at beginning of year                                                                      |  |                        | 1,626,322   |   |                 |   | 3,549,083   |                 |  |   | 3,832,477   |  
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Cash and cash equivalents at end of year                                                                            |  | $                      | 2,721,239   |   |                 | $ | 1,626,322   |                 |  | $ | 3,549,083   |  
|                                                                                                                    |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Supplemental information                                                                                            |  |                        |             |   |                 |   |             |                 |  |   |             |  
|Interest paid                                                                                                       |  | $                      | 13,595,630  |   |                 | $ | 11,749,446  |                 |  | $ | 12,962,784  |  
|Federal income taxes paid                                                                                           |  | $                      |            |   |                 | $ |            |                 |  | $ | 51,644      |  



- 9 -



---

-CONTINUED-



Reconciliation of Net Income (Loss) to EBITDA



|                                                                                                 |  |                                      |        |   |                                      |   |        |                        |  |   |             |   |  |                      |        |   |                        |   |        |   |  |   |        |  
|------------------------------------------------------------------------------------------------ |  | ------------------------------------ | ------ | - | ------------------------------------ | - | ------ | ---------------------- |  | - | ----------- | - |  | -------------------- | ------ | - | ---------------------- | - | ------ | - |  | - | ------ | -
|                                                                                                 |  | Three Months Ended December 31, 2005 |        |   | Three Months Ended December 31, 2004 |  
|                                                                                                 |  | As Reported                          |        |   | ContinuingOperations                 |   |        | DiscontinuedOperations |  |   | As Reported |   |  | ContinuingOperations |        |   | DiscontinuedOperations |  
|                                                                                                 |  | (dollars in thousands)               |        |   | (dollars in thousands)               |  
|Net income (loss) attributable to common stockholders                                            |  | $                                    | (1,699 | ) |                                      | $ | (1,582 | )                      |  | $ | (117        | ) |  | $                    | (7,753 | ) |                        | $ | (3,086 | ) |  | $ | (4,667 | )
|Depreciation                                                                                     |  |                                      | 4,320  |   |                                      |   | 4,320  |                        |  |   |            |   |  |                      | 3,269  |   |                        |   | 3,269  |   |  |   |       |  
|Interest expense                                                                                 |  |                                      | 3,606  |   |                                      |   | 3,586  |                        |  |   | 20          |   |  |                      | 2,842  |   |                        |   | 2,598  |   |  |   | 244    |  
|Income tax expense (benefit)                                                                     |  |                                      |       |   |                                      |   |       |                        |  |   |            |   |  |                      | 3,320  |   |                        |   | 1,406  |   |  |   | 1,914  |  
|                                                                                                 |  |                                      |        |   |                                      |   |        |                        |  |   |             |   |  |                      |        |   |                        |   |        |   |  |   |        |  
|EBITDA                                                                                           |  | $                                    | 6,227  |   |                                      | $ | 6,324  |                        |  | $ | (97         | ) |  | $                    | 1,678  |   |                        | $ | 4,187  |   |  | $ | (2,509 | )
|                                                                                                 |  |                                      |        |   |                                      |   |        |                        |  |   |             |   |  |                      |        |   |                        |   |        |   |  |   |        |  
|                                                                                                
|The items listed below have not been included as adjustments in the above calculation of EBITDA: | 
|                                                                                                 |  |                                      |        |   |                                      |  
|Gain on sale of property and equipment                                                           |  | $                                    | (15    | ) |                                      | $ | (15    | )                      |  | $ |            |   |  | $                    | (35    | ) |                        | $ | (35    | ) |  | $ |       |  
|Early extinguishment of mortgage notes                                                           |  |                                      | 1      |   |                                      |   | 1      |                        |  |   |            |   |  |                      | 34     |   |                        |   | 34     |   |  |   |       |  
|Impairment losses                                                                                |  |                                      | 80     |   |                                      |   |       |                        |  |   | 80          |   |  |                      | 2,254  |   |                        |   |       |   |  |   | 2,254  |  
|                                                                                                 |  |                                      |        |   |                                      |   |        |                        |  |   |             |   |  |                      |        |   |                        |   |        |   |  |   |        |  
|Adjusted EBITDA                                                                                  |  | $                                    | 6,293  |   |                                      | $ | 6,310  |                        |  | $ | (17         | ) |  | $                    | 3,931  |   |                        | $ | 4,186  |   |  | $ | (255   | )
|                                                                                                 |  |                                      |        |   |                                      |   |        |                        |  |   |             |   |  |                      |        |   |                        |   |        |   |  |   |        |  



|                                                                                                 |  |                              |        |   |                              |   |        |                        |  |   |             |   |  |                      |         |   |                        |   |         |   |  |   |        |  
|------------------------------------------------------------------------------------------------ |  | ---------------------------- | ------ | - | ---------------------------- | - | ------ | ---------------------- |  | - | ----------- | - |  | -------------------- | ------- | - | ---------------------- | - | ------- | - |  | - | ------ | -
|                                                                                                 |  | Year Ended December 31, 2005 |        |   | Year Ended December 31, 2004 |  
|                                                                                                 |  | As Reported                  |        |   | ContinuingOperations         |   |        | DiscontinuedOperations |  |   | As Reported |   |  | ContinuingOperations |         |   | DiscontinuedOperations |  
|                                                                                                 |  | (dollars in thousands)       |        |   | (dollars in thousands)       |  
|Net income (loss) attributable to common stockholders                                            |  | $                            | 605    |   |                              | $ | 440    |                        |  | $ | 165         |   |  | $                    | (34,106 | ) |                        | $ | (27,350 | ) |  | $ | (6,756 | )
|Depreciation                                                                                     |  |                              | 14,824 |   |                              |   | 14,824 |                        |  |   |            |   |  |                      | 14,505  |   |                        |   | 13,874  |   |  |   | 631    |  
|Interest expense                                                                                 |  |                              | 13,516 |   |                              |   | 12,970 |                        |  |   | 546         |   |  |                      | 11,611  |   |                        |   | 10,586  |   |  |   | 1,025  |  
|                                                                                                 |  |                              |        |   |                              |   |        |                        |  |   |             |   |  |                      |         |   |                        |   |         |   |  |   |        |  
|EBITDA                                                                                           |  | $                            | 28,945 |   |                              | $ | 28,234 |                        |  | $ | 711         |   |  | $                    | (7,990  | ) |                        | $ | (2,890  | ) |  | $ | (5,100 | )
|                                                                                                 |  |                              |        |   |                              |   |        |                        |  |   |             |   |  |                      |         |   |                        |   |         |   |  |   |        |  
|                                                                                                
|The items listed below have not been included as adjustments in the above calculation of EBITDA: | 
|                                                                                                 |  |                              |        |   |                              |  
|Gain on sale of property and equipment                                                           |  | $                            | (357   | ) |                              | $ | (19    | )                      |  | $ | (337        | ) |  | $                    | (802    | ) |                        | $ | (767    | ) |  | $ | (35    | )
|Early extinguishment of mortgage notes                                                           |  |                              | 385    |   |                              |   | 385    |                        |  |   |            |   |  |                      | 66      |   |                        |   | 66      |   |  |   |       |  
|Impairment losses                                                                                |  |                              | 80     |   |                              |   |       |                        |  |   | 80          |   |  |                      | 6,648   |   |                        |   | 769     |   |  |   | 5,879  |  
|Lease termination costs                                                                          |  |                              |       |   |                              |   |       |                        |  |   |            |   |  |                      | 8,954   |   |                        |   | 8,954   |   |  |   |       |  
|Preferred dividends                                                                              |  |                              |       |   |                              |   |       |                        |  |   |            |   |  |                      | 4,372   |   |                        |   | 4,372   |   |  |   |       |  
|Loss on redemption of preferred stock                                                            |  |                              |       |   |                              |   |       |                        |  |   |            |   |  |                      | 15,955  |   |                        |   | 15,955  |   |  |   |       |  
|                                                                                                 |  |                              |        |   |                              |   |        |                        |  |   |             |   |  |                      |         |   |                        |   |         |   |  |   |        |  
|Adjusted EBITDA                                                                                  |  | $                            | 29,053 |   |                              | $ | 28,600 |                        |  | $ | 454         |   |  | $                    | 27,203  |   |                        | $ | 26,459  |   |  | $ | 744    |  
|                                                                                                 |  |                              |        |   |                              |   |        |                        |  |   |             |   |  |                      |         |   |                        |   |         |   |  |   |        |  



- 10 -



---

-CONTINUED-



EBITDA is defined as income before interest expense, income tax expense, depreciation and amortization.

The Company uses EBITDA to measure the financial performance of its operations because it excludes interest, income taxes, and depreciation, which bear little or no
relationship to operating performance. EBITDA from continuing operations also excludes those items which relate to net income (loss) from discontinued operations. By excluding interest expense, EBITDA measures financial performance irrespective of
the Companys capital structure or how it finances its hotel properties and operations. By excluding income taxes, the Company believes EBITDA provides a basis for measuring the financial performance of its operations excluding factors that its
hotels cannot control. By excluding depreciation expense, which can vary from hotel to hotel based on historical cost and other factors unrelated to the hotels financial performance, EBITDA measures the financial performance of its operations
without regard to their historical cost. For all of these reasons, the Company believes that EBITDA and EBITDA from continuing operations provide information that is relevant and useful in evaluating its business.

However, because EBITDA excludes depreciation, it does not measure the capital required to maintain or preserve its fixed assets. In addition, because EBITDA does not
reflect interest expense, it does not take into account the total amount of interest paid on outstanding debt nor does it show trends in interest costs due to changes in borrowings or changes in interest rates. EBITDA, as defined by the Company, may
not be comparable to EBITDA as reported by other companies that do not define EBITDA exactly as the Company defines the term. Because the Company uses EBITDA to evaluate its financial performance, the Company reconciles it to net income (loss) (and
in the case of EBITDA from continuing operations, to net income (loss) from continuing operations), which is the most comparable financial measure calculated and presented in accordance with GAAP. EBITDA does not represent cash generated from
operating activities determined in accordance with GAAP, and should not be considered as an alternative to operating income or net income (loss) determined in accordance with GAAP as an indicator of performance or as an alternative to cash flows
from operating activities as an indicator of liquidity.

Adjusted EBITDA is a non-GAAP measure and should not be used as a substitute for measures such as
net income (loss), cash flows from operating activities, or other measures computed in accordance with GAAP. The company uses Adjusted EBITDA to measure its performance and to assist in the assessment of hotel property values. Adjusted EBITDA is
also a widely used industry measure which the Company believes provides pertinent information to investors and is an additional indicator of the Companys operating performance. The company defines Adjusted EBITDA as EBITDA excluding the
effects of certain charges such as gains and losses related to the sale of Inns, gains and losses related to early extinguishment of debt, losses on impairment of real estate, costs related to the acquisition of Kitchin Hospitality, preferred
dividends and the cost of redemption of preferred stock.

Forward-Looking Statements

Certain matters discussed in this press release may constitute forward-looking statements within the meaning of federal securities regulations. All forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual transactions, results, performance or achievements to be materially different from any future transactions, results, performance or achievements expressed or implied by such
forward-looking statements. General economic conditions, competition, and governmental actions will affect future transactions, results, performance, and achievements. These risks are presented in detail in the Companys filings with the
Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the Companys expectations will be attained or
that any deviations will not be material. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect any future events or circumstances.



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